Short of offering entirely new products, there are changes that can be made to existing products and/or existing marketing models that can improve sales and not drain your resource pool in the process.

 

I view product design in a holistic way; it is more than the aesthetic or functional aspects we normally associate with design. This holistic view of product design includes how the product is presented to the customer; how it is supplied to the customer; how the customer perceives the value of the product; and possibly most importantly, how the customer can feel connected to the product. These aspects present opportunities to enhance the value of a product in the market without expensive design revisions.

 

I’m going to use an example of “innovative design” from an entirely different industry, but the example holds for our industry as well; it is simply an example of thinking without false constraints.

 

Tractor seats are wonderfully fertile think tanks; moving at tractor speed my brain kicks into high gear. Likely because one of my boots was uncomfortable— since my feet are different sizes — I began to think about the potential business model that would allow a manufacturer to produce and supply customers with two shoes rather than a pair of shoes. I know there are companies that will sell mismatched shoes at a premium price, but that is not what I had in mind. 

 

To probe this market potential, I unveiled this concept at a dinner with friends that evening. There were eight people at the table and to my surprise there were three who immediately jumped on the idea; they share my problem.

 

Any shoe manufacture that has structured its manufacturing processes to produce pairs of shoes in lot size of one, has the potential to manufacture individual shoes rather than pairs of shoes. Yes, it would require changes in inventory management, order entry format and packaging — but these are rather minor compared to the potential market impact this innovation could hold. I suspect the biggest hurdle is in the distribution network, and that resistance is more rooted in unwillingness to change rather than in substantive hurdles to overcome. Unfortunately, unwillingness to change has sunk many potentially beneficial initiatives.

 

The point is that a market need seems to exist, although apparently not well recognized. The ability to leverage that need exists, although likely unrealized. However, everyone in that industry seems to be missing an opportunity to gain, at least in the short term, a major marketing advantage over their competition.

 

Our industry isn’t immune from similar self-imposed false constraints. Two key elements must come into play to leverage the value of market differentiation: recognize a need or desire on the part of the customer and then act on fulfilling that.

 

The key element in successfully implementing beneficial change is to understand your customers; what is important to them; what represents value to them. Do not make the mistake of hearing without learning. Customers might want something that you see as having no value; you aren’t the customer. Keep in mind, if the customers perceive value, they will also accept reasonable cost to add that value. Not all ideas that add value will come from the customer; simply because not all customers have tractors! 

 

I have one client who is providing a project management service to their customers that the customers never even imagined. This service is at no cost to the customer. My client benefits by now being able to control additional elements of the project, thus minimizing field changes and ultimately reducing his total costs. Since none of his competition has this ability, the service clearly differentiates him from the competition. The service also offers savings to the customer and builds a bridge of partnership in the often-adversarial world of contractor/sub-contractor relationships. 

 

The figure below is helpful in visualizing the concept of holistic product design. The inner rings are the aspects we most often regard as product design. This is also where the heavy lifting and high resource demand of product design reside. It is in the outer rings that differentiation can be achieved at a relatively minor level of implementation cost. Most of these “augmented” and “intangible” attributes can be changed or added to existing products without costly revisions to their design.

Do not allow the evaluation of proposed changes to be biased by a litany of self-imposed barriers. Define the true issues to be addressed; then develop the strategy to solve them. Painted doors and drawer fronts on stained clear coat cabinets is a perceived problem for some manufactures, only because they haven’t done it before and it doesn’t exist in their “standard” product offering. Don’t allow self-imposed false barriers to block your access to a broader market.  

 

Not all customer accommodations will result in higher price, but they can accomplish the goal of differentiation and thus increase sales volume. Customers are not willing to pay a significant premium for an interactive website that allows them to participate in the design of their project or to monitor status of their orders. However, they are far more likely to favor you with orders over your similar priced competitors who do not offer these services. Access to an interactive website will also invite potential customers to your table who might otherwise not have “stopped in” had it not been available.

 

Utilize technology you already have and extend that power to your customers. Custom products such as store fixtures can utilize common CAD formats with customers through easily implemented FTP (File Transfer Protocol) applications. This will encourage interactive collaboration on the part of your customers. It also holds the potential of shortening the design/approval stages of projects that seldom add to cash flow.

 

After-sales accommodations can offer attractive incentives to prospective customers, but be sure you understand the potential cost that might be incurred. Those potential costs may be less than you imagine. One major developer that I know offers a 10-year new home warranty at a slight premium. Knowing their quality isn’t higher than the competition who offers only the standard one-year warranty, I questioned how they could do that. The answer was rooted in understanding their market; their average buyer moves within four years and the warranty isn’t transferable. They experience a very low claim level on an option that most buyers elect.

 

After-sales maintenance can offer significant benefits to both you and your customers. It can provide a new revenue stream and at the same time keep you connected to your customers and future business. 

 

Direct delivery to the customer can be a valuable tool in building ongoing relationships. Make certain that the delivery people represent you well, are accommodating, well mannered and present a professional image. Don’t allow a potential sales tool to become a liability through poor management of those who become the “face” of your company.

 

All of these initiatives have one thing in common; they cast a wider net. Having a green image, for example, does not mean that all your customers will ultimately buy green; it does mean that some of those customers stopped at your door precisely because you presented a green image.

 

As you look for ways of improving your market penetration, keep in mind that you have more options than simply new product. Look at your product design arena in a holistic way and consider adding attributes to existing designs that can expand your market, or offer improved pricing in your existing market.

 

The market for most of our industry is constrained. Increasing volume, or even holding steady, will require an increase in market share or moving into new markets; that will not happen by doing business in the same old way.