If you’re not developing new products, your business is on (or soon will be on) a downward slope. The New Product Questionnaire and the Product Development Worksheet in this issue of The Krehbiel Report provides a framework in which to think about new products. You’ll undoubtedly need to adjust it to your situation, but it should help you establish a solid starting point.

Read and reflect on the Questionnaire first. The Worksheet takes each item in the Questionnaire and probes a little deeper, helping you to flesh out your idea and discover its strengths and weaknesses. This is all based on my experience in publishing, but it has broader applicability. Modify it as necessary to fit your model.

Think about each question carefully, even if it doesn’t seem to apply to the idea under consideration. The question might uncover another area you should consider, or another set of facts you should collect. And if you need help with the process, give me a call.

New Product Questionnaire

• What problem are you solving?
• Who has this problem? (Who is the market?)
• How is your prospective market currently dealing with the problem?
• How motivated is your market to change their current situation?
• How will you help them solve this problem?
• How will their life be better if they solve this problem with your service?
• What is the revenue model for your service?
• Are the benefits they will receive from your service at least three times the cost of the service?

Product Development Worksheet

What problem are you solving?

State the problem from the perspective of the person who has is experiencing it, e.g., “I need a job,” “I don’t understand how to comply with this regulation,” “My marketing emails are not getting opened,” “I can’t find qualified applicants,” “I don’t know when to take Social Security.”

Problem: [State the problem here.]

Who has this problem? (Who is the market?)

The more precisely you can identify the person who will choose to acquire and use your service, the better. If the person making the buying decision is different than the end user, try to answer these questions for the buyer and the user separately.

Define your ideal customer in as much detail as you can.

Job title:
SIC code:
Demographics (age, sex, geography, etc.):
Certifications / training they need:
Annual revenue:
Company size:
Etc.

How large is your market?

Find as many estimates as you can, including direct mail and email lists, association memberships, directories, Dunn & Bradstreet, social media groups, government statistics ….

List them here.

Buying authority

Does the person you are targeting have spending authority?

◻ Yes
◻ No

What is their budget?

Is there a time of the year when such requests are usually submitted?

How is your prospective market currently dealing with the problem?

They’re probably not all dying or going to jail right now, so what are they doing?

Some people in your market are avoiding the problem.

• Why are they willing to live with it? Maybe it’s not as bad as you think it is. Be as honest and practical as you can. Maybe even cynical.

Some people in your market are using other sources (your competition). By category, list the source and the price of each competitive product or service, and how your solution is better.

• Publications
  • Newsletters
  • Books
  • Online services, etc.
• Blogs
• Podcasts
• YouTube channels
• Social media groups (Facebook, Reddit, Twitter, etc.)
• Government publications / services
• Associations

How motivated is your market to change their current situation?

Presumably your market is coping with this problem in some way now. What are they doing?

In some cases, people know they have a problem, but it’s not a big enough concern to do something about it. Why does your market need to do something? When do they need to do it?

Is it a double sell?

Do people already know they have this problem, or do you have to explain that to them first, then propose your solution? If so, that’s a harder sell.

What evidence can you find that the market is concerned about this problem?

What are the practical consequences of failing to address this problem? (Jail, fines, fees, loss of revenue, loss of opportunity, your spouse will leave you ….)

What kind of problem is it?

A “nice to have” solution might cure someone’s ignorance or satisfy their curiosity. A“need to have” solution will keep them out of jail, save them money, keep them alive, etc. “Need to have” is better.

Is the proposed solution …
◻ nice to have, or
◻ need to have?

[Explain why here]

How will you help them solve this problem?

What are you bringing to the table that they don’t have access to now?

How will it solve their problem?

List the features of your solution and how they help the market avoid the problems addressed above.

How easy is your product to use?

Does your solution require the user to have access to any specific technologies, like a Kindle, or an iOS phone?

How will their life be better if they solve this problem with your service?

List the benefits of your publication. What’s in it for them? Be as practical and cold-hearted as you can be.

How will your service make them wealthier, sexier, feel younger, more carefree, more confident, get more dates, etc. [It sounds silly to put it this way, but you have to think about what truly motivates people to part with their money.]

What is the revenue model for your service?

• Ad supported
• Sponsor supported
• Subscription
• Crowdfunding
• Freemium
• Loss leader for another service
• You take a cut of each transaction

How does your revenue model distinguish your product from the competition?

Are the benefits they will receive from your service at least three times the cost of the service?

Add up all the benefits customers will receive from your service. Assign a dollar value as often as you can.

• Discounts offered
• Time saved
• Replacement for existing services that cost more (consultants, lawyers, accountants, etc.)
• Be creative!

Build a Business Plan

If, after reviewing these questions, your product idea still makes sense, you need to test it. There are any number of ways to do that (call me if you need ideas), but you should certainly speak to some people in your target market and get their reaction.

Pro tip: Don’t get too excited if lots of people say they would buy it. They’re probably just being nice. Saying you would buy something and actually buying something are two different things. The only real test is when you ask them to take out their wallet, but some people say you can get a fair estimate on price if you ask the question this way: “What do you think your peers would be willing to pay for a product like this?”

Your business plan will need a specific marketing plan and/or sales strategy, cost and revenue projections, etc. Back when I did product development for new monthly publications, we used a 5-year model to project marketing campaigns and their costs, response rates, editorial and contributor costs, revenue, return on investment and so on. It wasn’t perfect, but it provided a practical test of price and cost assumptions. Talk to your accounting department about creating a useful model that works for your company.

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If you need any help with the new product development process, or about anything in the marketing / technology / publishing space, please give me a call. 240-687-1230