Understanding Market Need

Last week, the Fire Enterprises, Inc. (FEI) tribe kicked off product strategy discussions by reviewing the importance of creating product differentiation. This week, the topic around the FEI conference table is why understanding market need for potential products is a crucial early step in the product development process. Remember, fire = print.

The FEI tribe gathered in the conference room for a product development meeting. Zoot, Numo, Marka, Org and Lucy each took a seat around the stone table.

Lucy pulled a piece of bread out of her pocket. “We need to determine the market share commanded by FEI’s current products, and identify market niches that can be filled with new offerings,” she said.

“How long has that been in your pocket?” Zoot asked.

“Let’s take a lesson from Pompei Bakery,” Lucy suggested, holding up the slice of bread. “They used to only sell white bread, until they discovered that consumers also wanted wheat, whole grain, French, Italian—you get the picture.”

“Fire is like bread,” Lucy continued. “We just need to find the ‘wheat’ and ‘whole grain’ type niches in our market.”

“How?” Org asked with curiosity.

“Identifying new market segments in which to focus our product development efforts is a three step process,” Lucy explained. She scribbled the following on a whiteboard:

1) Create a product map of current products, their position in the marketplace and relative niche sizes.

2) List new “category creation” possibilities.

3) Narrow list to the ones that are “near” fits with FEI’s core competencies.

“New product development is easy, if that’s all there is to it,” Zoot said warily.

“I didn’t say that!” Lucy objected. “There are many more steps to the product development process, including due diligence, plan, punch holes in plan, plan again, market test, modify plan, launch.”

“And, I need assurance that these market expansion efforts will produce a return on investment,” Numo added, wagging a bony finger.

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T.J. is team leader of Grow Sales, Inc., a marketing and social media services company operating at the intersection of compelling content, clear vision and quality communication practices. In this blog, fire is a metaphor for print. Hang on, this ride will be weird...Prometheus crept into Mt. Olympus, stole fire, returned to the lowlands, ran from house to house distributing it, got caught, was chained to a rock, lost his liver to a huge ugly bird and was rescued by Hercules. Leveraging his fame, Prometheus started Fire Enterprises Inc.  (FEI). Since fire was the hottest technology of the time, company success came fast and furious. Two generations later, fire isn't such an easy sale. Now led by Prometheus' grandson Org, FEI's growth is non-existent, competitors are pounding and prices are in the toilet.
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