There’s plenty to think through when deciding if your new product idea is going to be worth investing your time, energy and money in. Is it something that your clients *really* want? What price should you charge? How do you go about marketing it?
But there’s one question that gets forgotten … what job is this product going to have in your business?
Let me explain with a story from one of my clients last year. She had been running her marketing consultancy for some years, and although it was going OK, she was struggling to expand it and increase her revenue. No matter what she did, her business didn’t shift.
Then she was given the idea of creating a membership product. What’s not to love about a membership product? Regular, consistent income … a perfect passive income! She threw herself into developing the idea; went on a course, learnt all there was to know about setting up and running a membership product and launched it.
When we started working together, she had been running it for around six months. It became very clear that she was spending 80% of her time with the clients that were generating 20% of her income. Her membership product, although packed full of value, was running her ragged.
She told me the reason she wanted to create this product was because she wanted something to offer the people who couldn’t afford her consultancy fees.
At first glance, this may seem to be reasonable … why leave money on the table?
But her bigger vision was to scale up her consultancy business so she could outsource much of the delivery, and free up her time to start up a new business. What this membership product had done was to make her busier than ever, working more with the clients who weren’t going to help achieve her ambitions.
She’d created a down-sell product for people who realistically were never going to be worth more than a few hundred pounds a year, and yet ended up taking up most of her time and expertise.
In a very short period of time, she had closed down her membership product, which immediately freed up her time to focus on the right projects to move her towards her bigger vision, and four months later she had launched her new business alongside her current consultancy.
Of course, this isn’t about whether a membership product is a good idea or not. There are plenty of businesses who thrive having a membership product, serving hundreds of people every year, often as an up-sell or prospect product to their existing programmes and services.
The point is whether the job of your new product idea is going to help you achieve your bigger vision.
In the case of my client, it made strategic sense to NOT create a down-sell offer for the people who couldn’t afford her – because let’s be honest … it’s going to take a very long time before any of those people are going to be in a place to afford her consultancy fees (there are plenty of more effective and less time intensive ways of staying engaged with them if that’s what you want to do) – and instead focus her time and energy on what’s going to free up her time to allow her launch her new business.
So when you are pondering on your next new product or service idea, ask these three questions before your creative surge takes you too far down the launch path.
1. What is the job of the product?
Is it to give an easy, low risk way of acquiring new clients … will it be your core offering that you focus most of your time on … or to add value to your clients and increase their average spend … or is it a way of extending your client lifetime spend?
Know exactly what you want this new product to do for you and your business and keep this clear in your head as you set about the creation and launch process to ensure you don’t go off track.
2. Will it help you achieve your financial goals?
No matter how brilliant an idea it is, will it move you towards what you really want out of life and business … will it really increase your revenue and by when … or spread you too thin across too many products?
Set clear financial goals and quantify your expectations because there’s every chance you will also see you’ll need far less leads and sales to make this a success, especially in the early stages.
3. How can this product idea scale your expertise without you?
It may be that you are still very much your business, but if your ambition is to grow and scale, it’s never too early to start asking questions such as how much of your time is needed to create and deliver this product … what resources could help speed up the process and make it easier … and who can you ask for help?
One of the biggest shifts you can make to move from being a busy freelancer to having a profitable, scalable business is to change your questions from ‘How do I?” to what and who questions … it shifts you to not just being a business owner, but to being a CEO and opening up your growth potential.
For most people I speak to about growing a business, coming up with new ideas is never a problem. And it’s very easy to get caught up in all the fun, creative stuff in those early stages of a new idea. So before you get too far down the process of creating and launching a new product or programme, stop and think about it strategically.
It will save you months, if not years, of stress, worry and frustration.
Looking for your next step to take?
Let’s talk through your current product offerings and I can help you see where you could be running your business smarter – book a Next Level Business Strategy Session with me. There’s never any charge for our first call together. Click here to check out times available.
Until next time, do less, be more, play bigger.