path to profit

Where Are Your New Product Opportunities?

Looking to grow sales? You have some options. You can expand into new markets, find new targets for current products, develop a new product and services for your current customers – or a combination. Here’s how one business owner in Philadelphia used this strategy to build sustainable growth and profit.

Business Spotlight on Pinot Boutique

Opened in 2006 as a wine accessory and gift business, today Pinot Boutique is a wine lover’s playground with local wines, classes, tastings, accessories and more!   Client and Owner, Dan “The Wine Man” Soskin, shared some of his secrets to success with my radio listeners.

#1 – Talk to customers. They can help you identify needs that you can fill. What products or services do they WISH you had available? Conversations work best – whether they are face-to-face or via phone. And you don’t need to have hundreds of conversations to uncover opportunities. Quality discussions with a handful of high-value customers can reap a lot of rewards.

#2 – Look for niches within your target market. New products or services do not need to appeal to everyone in your target market to be successful. In fact, many are attractive to a sub-group or niche. While most of Dan’s customers enjoy and drink wines, there are sub-groups that are ideal for certain products. For example, wine lovers who also want to learn about wines and how to pair them with foods enjoy his wine classes. Tourists who visit historic Philadelphia enjoy the line of souvenir wine accessories he has available.

#3 – Know your competition. What products and services do they offer and how do they price them? Who are their customers – are they the same as yours? What do their customers say about them based on reviews, testimonials or discussions? What do they do well? What are their weaknesses? Be honest, especially as it relates to their strengths and weaknesses. Look for gaps that you can fill.

#4 – Test and track. We typically expect success from our new product or service. Why else would we do it? The reality is that some will be a hit immediately, some may need tweaking and others will fail. But you won’t know this if you don’t test different elements and track results.

#5 – Cost vs. Potential. Identify the costs for the product or service and marketing investment needed to get the word out. These are important, but only relevant when compared to earning potential – how much revenue and profit can the new product or service generate. Being optimistic, most owners tend of over-estimate potential revenue, so begin by calculating the break-even level. Based on your costs and expected selling price, how many sales dollars or customers do you need to cover the costs? This gives you a good starting point to evaluate the decision.

More Ways to Grow Your Business

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