Wednesday, October 27, 2010

Your New Venture: Try Selling Aspirins, not Vitamins

The Heath brothers have another terrific column in Fast Company magazine this month. In their article, they describe how entrepreneurs must not just build a better mouse trap, but make it clear why that mouse trap addresses a "felt need" of the consumer. Here is what they say:

If entrepreneurs want to succeed, as venture capitalists like to say, they'd better be selling aspirin rather than vitamins. Vitamins are nice; they're healthy. But aspirin cures your pain; it's not a nice-to-have, it's a must-have.

The must-have vs. the nice-to-have: it's a wonderful distinction that all entrepreneurs must keep in mind. Find those pain points for consumers and then design a product or service that addresses that well. The Heaths have some nice examples in the article, including NetFlix, which discovered a felt need when it eliminated late fees. As an another example not found in the article, consider Commerce Bank. It created a very different kind of bank, one much more focused on providing a pleasant customer experience. In fact, that experience was so satisfying for consumers that it could attract savers without offering higher interest rates than rivals. Commerce Bank, for instance, discovered that one pain point for many consumers was the limited hours during which banks were open. Thus, Commerce became one of the first consumer banks to have extended hours during the week, as well as hours on weekends.

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