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Product Creation = Revenue!

by: bossmentor on Date: Fri, 16 Jul 2010 Time: 10:56 AM

You may not think product creations is particularly important if you have a service business, but it is!

The more products you can offer your clients, the more benefits for everyone:
• More value for your clients (assuming of course that your clients want the products you've created)
• New sources of revenue for your business
• Innovation keeps you competitive
• Client retention as long as you keep giving them value
• Increased lifetime value of your clients
• Higher purchasing frequency by your clients

This is equally as important for a large corporation as it is for a small business. If you sell your client or customer one product or service once, you will always be on the hunt to develop new business opportunities and new clients.
It costs money to acquire new clients – direct sales people, marketing campaigns, telemarketers, setting up distribution channels, retail outlets and so on, depending on your business model.

Once you capture new clients, you need to grow them. In order to do that, you need a range of products to sell.
How does a service business create new products?

There are many steps involved in this process, but if you focus on these few steps, you will be on your way:

1. Review all the services you have provided all of your clients over the last few years. Take a page for each main service. Write down all the sub-services underneath it, which are all the steps you take to deliver the final outcome for your client. Could any of those steps become a product on their own? For example, if you develop marketing plans for your clients, and part of the planning process is to conduct a competitive analysis of the market, could you expand on that step and make it a new ‘product'? It could be an entry level product for new clients, before they commit to a full marketing plan, it could be an annual product for those companies who want to keep on top of what the market trends are on a regular basis, or it could be a product that some of your clients will buy when they are thinking of developing a new product, and want to research the market first. Suddenly, from a standard marketing plan service, you have at least one new product to sell to new and existing clients, possibly on an annual or biannual basis if you position it well.

2. Talk to your clients and find out what else you could be helping them with . Often new services come out of existing ones. For example, once you have created a marketing plan for your client, what they are likely to need next is a copywriting service to produce new or updated marketing materials – brochures, website, company overview etc. Could you extend your current services into a logical next step (next product) for your clients? If you don't have such products to sell, your job is done once the marketing plan has been completed. You need to continue delivering value to your clients, and building the relationship you have through ongoing contact.

3. Look at what your competitors are doing . Using the above example, you may be thinking about developing a new competitive analysis ‘product', and discover that there is an opportunity to specialise in providing competitive market analysis in a particular segment. Keep fine-tuning what you do, and what else you could be doing.

4. ‘Package' your products . Name them, describe them, create the value proposition, price them, protect your intellectual property through trademarks, and promote them!

5. Follow these steps regularly until you have successfully developed your own product creation system !

About the Author

Jenny Stilwell is the Managing Director of BOSSMENTOR®, a consultancy providing advice on strategy and business growth for professional, lifestyle-oriented owners of service-based businesses who want to grow their businesses and ultimately spend less time in them. Bossmentor® provides mentoring programs, consulting services, and a range of resources for business owners wanting to grow. Visit http://www.bossmentor.com.au

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