Know-How Exchange : Strategy

Dear Marita,

You believe there is a huge market for this thing, hmm? Well, before you do anything, stop believing and find out for sure.

Google the living daylights out of the product or the category across your proposed area, then tally your findings based on keyword significance and search rates.

Figure out your selling cost, your overheads, and project out some revenue based on a conversion rate of 2 to 5 percent of your google search results.

Next, pull together some kind of tempting offer—a free report on the product's benefits, a short video, or a DVD you can mail to people.

Secure a domain name and run some Google Adwords. Split test your ads, direct the ads to a small site: nothing fancy, just something to create a presence, and run an offer for your report or your video.

A little time with a borrowed video camera, some gentle edits on a friend's Mac, and a short run of duplicated discs with art work from www.discmakers.com, and you can have a not too shabby looking front end offer. Throw in a transcript and you increase the perceived value.

From your offer and your mini site you can test potential sales and probable sales BEFORE you invest in merchandise. While you're doing all this, check with Canadian customs on import duties, restriction, and so on. On second thoughts, do this BEFORE you do anything else, otherwise your experiment won't bear any fruit and you'll be out of pocket.

If import issues don't exist or are minimal and can be mopped up through your mark up, set up suppliers (or drop shipping agreements if that's easier:with drop shipping your site becomes a payment portal, you e-mail orders to your link in South America, they ship to your customer, your customer pays you, you pay your drop shipper and everyone's as happy as a lark).

Start small and then expand IF YOU HAVE BUYERS.

There's no point at all in setting up anything until you know you have people who are interested in giving you money in exchange for the product you're offering.

So, do your homework. Find a market of pre-sold buyers. Start small. Then move from there.

I hope this helps. Good luck to you.

Gary Bloomer
Wilmington, DE, USA

I've been involved with food on several projects.

My opinion: to begin TASTE TASTE TASTE. Get as many jars/bottles/containers into Canada and simply offer everyone who wants one - a free taste. Frankly, nothing else matters but taste. If people like it, really really really like it; return to this forum.

Marita:

Gary offers some good advice. I recommend doing some homework on your product and the category as well.

In addition to the internet search, do some grass-roots homework on the product, brand, competition and category in local markets. Determine how big the market is and who the competition are and what they offer / how your product differs -- or how you can differentiate, by looking in the channels of distribution you'd be in.

Complete a SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis for both the category and your brand. Try to analyze (and monetize) the market size overall, the market share you might obtain, the overall sales, points of differentiation, legal and regulatory issues, brand and category opportunities (by channel), etc.

Look at the product, packaging, promotions, advertising, etc. Who comes up in an online search for the category? Are they paying for ads or just showing up in natural search? What are they saying/doing to promote their brands? What do their websites offer and what other products are they selling? How big are their budgets and what is the breadth of their distribution strength? Look at complementary product categories for marcom ideas.

Also, who is your target? Where and how do they shop? How are they different from competitive and substitute product users? Net - determine the size and potential of your audience and your unique niche/opportunity.

The list of questions is long, but needs to be ascertained, and answered, before taking on an investment of your own.

It's a lot of work to complete properly, but you can start with a personal evaluation and topline assessment to determine if real research and monetary investment are warranted before sinking a lot of dollars onto the project.

This is extremely cursory - but I'd be glad to provide more insight if you have specific questions!
-Steve Udell

Are you thinking of selling it directly to consumers or getting it placed on supermarket shelves? In either case, unless there's a strong recognition of the name & need of the product, you're going to have to spend a lot of $ to educate people about it. Before you spend any money though, run the numbers. Figure out how much your costs are, import tariffs, stocking fees, shipping, advertising, etc. Then figure out your break even point. If the numbers are do-able from your pocket, then start talking to people and getting samples, exclusive distributorship agreements, etc.