An Entrepreneurs Guide to The Headwinds of Change


By Art Reisman

For anybody who has ever done something innovative you’ll find most technology advances require some sort of change in behavior on the part of the target customer  (consumer or business).  The larger the organization,  the less likely they are to embrace that change, many times they are downright hostile toward change.

I attended an entrepreneur group last month where a company is going to market with a smart Window that changes reflectivity with outside temperature. The demand and value for this product clearly distinguish it as cost-savings winner, and yet, because entrenched ideas about smart windows, it has been a 12 year battle of sacrifice and pain for founder Wil McCarthy to get his product to market.

Like eating an unknown berry when you have other food sources, the human resistance reflex is perhaps deep-seated and evolutionary.  On the other hand, people will react to perceived threats almost immediately, a topic I wrote about previously.

Here are some of the governing factors that limit the ability of  a new product to change or enhance a market space.

1) Cash. Most businesses have already spent their spare cash before they have accumulated it.  They don’t keep a kitty around for a new  idea. Typically they  have a long list of existing ideas politically competing for a limited amount of investment.

  • The sports bar could use new big screen TV’s
  • The factory needs new automated robots
  • The office building could save money with new thermal windows

Barring some rare financial good times, like the stock bubble of 2000, all new products must face the reality of “cash flow politics”.

The list of productivity enhancements for any business is endless, so when an entrepreneur comes along with a newfangled idea to help a business, the newcomer must compete with cash needs within the organization. The new product/idea must be either superior to the existing list, or you must politically work your way to the top of the list.   Barring some rare financial good times, like the stock bubble of 2000, all new products must face the reality of “cash flow politics”.

2) Credibility

Perhaps this line item should have come before cash, but realistically none of these are optional.

I am normally not a big supporter of using your friends and relatives as market validators, (they will never give you honest feedback if your idea has a flaw) but you’ll need some friendly reviews of some kind to vouch for your product as a reference. So get a few people to try your product or service and write a review. Don’t be bashful about aggressively pursuing your references to say something. There are no rules here other than the references must be verifiable – as long as you know your product works and are willing to stand behind it.  Don’t worry about how prestigious your reviewers are – just get someone to agree, get a quote or two, and then set up a professional looking web page with the contact information for your references.

Note: When you set up a Web Page, you’ll likely use a template. Make sure to fill out every aspect of the template, there is nothing worse than going to a business web site and finding templates that have not been filled out with thoughtful content.

3) Market Research, will they buy?

This does tie back to the Cash question.

Most young, first-time entrepreneurs assume that since they like their idea, and all their friends like the idea, then people will buy their product or service.

The best thing you can do to get real honest feedback is to sell your product early based on a description. Call it a pre-order, or a promise to purchase. Figure out some way to find out if a real customer is willing to pay any amount for your product, before you spend 1000’s of hours building your product.

The level of commitment could be something as simple as a registration form for a discount on your website. If somebody takes the time to fill out a form on your web site, they are likely to buy later… I don’t have the cycles to explain all the ways to do this type of validation, but I can tell you the narrow audience of talking to your friends and family about your product as your conclusive market research is very misleading.  Sure, they may buy it, but you need to engage a stranger and get them to commit to something. The registration for a discount is just one simple way to confirm a higher level of commitment of interest before you invest too heavily in the idea.

4) Best if your product returns something $.

People and business like things that make money for them. This scheme is exploited to the hilt with vertical marketing, (e.g. Amway  Corporation and such…).  I am no fan of vertical marketing, but my point was that you need to offer your customer a way to make money and then you’ll get their attention. A better example would be the ATM business, banks pay convenience stores to place their ATMs in their stores. Another example is pay-per-view TV in hotels. Lodgenet grew to a multi-billion dollar company by offering small hotels a share of the revenue for their pay-per-view. What do you think works better when approaching a hotel operator? 1) selling pool cleaning supplies, or 2) a pay-per-view movie system that creates revenue to their bottom line.

Although these types of revenue generating ideas may require a change in your entrepreneurial thought process, they will greatly increase your chances of financial success.

One Response to “An Entrepreneurs Guide to The Headwinds of Change”

  1. NetEqualizer News: April 2014 | NetEqualizer News Blog Says:

    […] An Entrepreneurs Guide to The Headwinds of Change […]


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