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THE
ONLINE INVENTOR –
(c)
2010 Market Launchers, Inc.
http://www.marketlaunchers.com
Editor:
Paul Niemann
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Dear
Inventor:
If you want to sell or license your new product, you need to have a good way to show it to companies. What better way to do that than to have YOUR OWN WEB SITE? Well, guess what? We build web sites for inventors. Call me today and I will get started on building YOUR web site TODAY. (800) 337-5758 or (217) 224-8194. If you already have your own web site, call me to day and I will show you how to get your product listed on our site.
On
to this issue. Enjoy!
Best
Regards,
Paul
Niemann
Paul Niemann
www.MarketLaunchers.com
(217) 224-8194
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CLEVER QUOTE … “The only way to get everything is to give everything” – Max Maurisani
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Article
# 1: “How
to Get
Your
Molds
Paid for –
By
Your Customers”
By
Paul Niemann of MarketLaunchers.com
On financial guru Dave Ramsey’s radio talk show the other night, a caller asked him how to raise the $8,000 that he needs for a mold for his new invention. Dave, being the financial guru that he is, offered the following advice, which you may have heard before and which is excellent …
“Since
your product will be sold to retailers at $18 per unit, offer it to them at $8
per unit if they buy 1,000 units and pay you upfront.”
Pretty smart advice, if you ask me. Plus, there’s another benefit of doing this: It shows you whether or not you can sell the item. If you cannot sell it at a 55% discount ($10 / $18 = 55%), then you cannot sell it, period.
If you can’t sell it, then this kind of market research may save you from wasting money on a mold, in addition to other expenses that would come your way.
As advertising consultant Mike Blinder says, “If you’re going to fail, then ‘Fail fast, Fail cheap!’ ”
#
# #
Paul
Niemann runs MarketLaunchers.com, building websites
for inventors and small
businesses. He can be reached at niemann7@aol.com
or at (217) 224-8194
Article
# 2: “The
Ugly Truth about Innovative New Products”
By
Perry Marshall
All
my life I've been in the business of selling some kind of new idea or new
technology to change-resistant, conservative markets. The proverbial
"better mousetrap."
If you've ever done that, you know that the world does NOT beat a path to your
door. It's hard work. And I've learned that there's a right way to do it,
and
a whole bunch of wrong ways.
Today I'm going to give you some bad news – and some good news.
First the bad news:
When I was 9 years old, I learned about Thomas Edison, and I wanted to be an
inventor. And by the time I was in college, I actually had some patentable
designs. My wife sent in for information from one of those "invention
submission" companies.
Have you ever seen those?
Well, to make a long story short, there is a myth that there are companies out
there who are hungry for great ideas and will pay you royalties if you give them
one.
That is totally untrue. As a matter of fact, some of the large toy
manufacturers hire 3rd party companies to sort through their mail and shred
product idea submissions, just to be sure that that nobody can ever say they
sent in an idea that was used.
The bad news:
Ideas are a dime a dozen. Good ideas are a dollar a dozen. Great ideas
are a dollar each. Even if you have truly great ideas, it's not possible
to make a living, or build any kind of business, on ideas alone.
The good news:
Well-executed, successfully MARKETED ideas are worth millions. Three years
ago I worked at a company where we took an existing product (a very specialized
product for computer networking), and built a market for it.
Then we re-invented that product and introduced a new kind of IC chip. We
proved that there was an even bigger market for this chip.
We sold that company to a larger NASDAQ company for $18 million in cash and
stock.
If you have new ideas, new technology, or any kind of innovative product or
service, in order to sell it you need to successfully do what I call
"Missionary Work On The Cheap."
Missionary Work on the Cheap is an entire sequence of steps that you use to
verify that there is in fact a market for a product, and that you can acquire
new customers at a reasonable price. I don't have the space here to go
into the full details, here is basic idea of how this works:
1) There is a slew of tools, both online and offline, where you will discover
exactly what kinds of needs exist, what real people are searching for, what
audiences other marketers
are serving, how many customers there, are and how much they spend.
2) In most cases you will be 70-80% certain whether or not an idea will fly, and
it will cost you as little as a few hundred dollars to no more than a couple
thousand dollars. In some cases, at the end of that process you will have
an order in your hand from a prospective customer.
3) First things must come first: I have a member who started an anti-spam
service - one that's arguably head and shoulders above all the other ones out
there, the proverbial 'better mousetrap.'
He contacted me to get help with a public relations campaign for his company.
Most people would have taken his money and written him some press
releases. But I asked him if he could prove that his sales process was
already working and he wasn't sure. So I refused to take his
money. Instead he started experimenting with pay-per-click search engine
traffic, just trying to see if he could GIVE away the service for free.
That was a very good move on his part, because he discovered all kinds of little
problems and obstacles. He solved these problems within the context of a
controlled environment, and tweaked his process to the point where he started
charging money for his service and making a profit.
NOW he's in a position to rub the media genie -- and when he turns on the
publicity machine, he'll get a flood of new customers at nearly zero cost.
He's put a lot of sweat equity into this, but not very much money, and no cold
calls, no wasted advertising dollars, no MBA's, no Andersen Consulting, none of
that.
And he's got a business that runs on autopilot and he's poised for a major
success.
There's almost N-E-V-E-R any reason to sink huge sums of money into your
projects. There's no reason for companies to spend hundreds of thousands
or millions of dollars developing products that fail. It just breaks my
heart that so many still do.
Don't make that mistake! You can save yourself lots of money and lots of
heartache -- and when the market takes off, the rewards are all yours to keep.
# # #
Perry Marshall, Perry S. Marshall & Associates, 159 N. Marion Street #295, Oak Park, IL 60301 United States (312) 458-9102 http://www.PerryMarshall.com
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Dear Inventor:
An inventor called me today and told me that when he sends
calls companies to tell them about his invention, that they never call him back.
This happens a lot, and today’s article explains why you should focus on
companies that are within driving distance. In fact, it explains why you should
get to know your market first – and then invent products for that market.
It was written by licensing expert Harvey Reese, who has
licensed over 100 of his own inventions and now helps inventors with the
licensing of their products. Best of all, this story can save you from a lot of
the headaches – and heartaches – that you go through in the
commercialization process.
This week’s issue brings you a new feature to this
newsletter: The Joke of the Week. When
subscriber Werner Schroeder sent me a joke in response to my announcement that I
am getting married soon, a light bulb went off in my head, and adding a Joke of
the Week is the result. Here’s the first one:
JOKE OF THE WEEK:
A guy shows up at the pearly gates and finds two signs. One sign
points to the left, which is for husbands who were controlled by their wives. To
the right is a sign that says: “Husbands not controlled by their
wives.” To the left there is a long line and to the right there is only one
guy standing there. So, he goes to the right and asks the only guy standing
there: What are you doing here all by yourself ? He answers: “I
don't know; my wife told me to wait here.”
-- submitted by THE ONLINE INVENTOR subscriber Werner
Schroeder
Read on, and enjoy this issue!
Best Regards,
Paul Niemann
Paul Niemann
www.MarketLaunchers.com
(217) 224-8194
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CLEVER QUOTE … “That
restaurant is so crowded that nobody goes there anymore” – Yogi Berra
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Article # 3: “Marketing Your New Invention: The
Chicken or the Egg?”
By Harvey Reese of Money4Ideas.com
I have lately been browsing the inventors'
newsgroup on the Internet, and although the level of intelligent discourse is
impressive, the subject matter is sadly revealing. Someone will post a question
about the patenting process, and like flies to honey, immediately a half-dozen
patent lawyers or semi-pro patent appliers join in. "Should I get a PPA?"
"What about an NDA?" "Can someone clarify the First to Invent
laws here in
Assuming, of course, that the point is to make money by licensing ideas.
So much attention is paid to process that no one seems to have the time or
inclination to ask about the business of inventing. No one asks, "How can I
get an appointment with the chief executive?" "How should I prepare my
presentation?" "What kind of questions should I be prepared to
answer?" "How do I handle the not-invented-here syndrome?"
"Do I need a prototype?" "Should it be in a consumer
package?" "Do I need to worry about store displays?" "How do
I line up appointments at a trade show?" "How do I get a professional
appraisal of my idea?" "What are price points?"
"Discounts?" "Markups?" Nobody asks these things; they only
ask about patents and for advice about how to prevent someone from stealing
their idea.
It's not surprising that so few patented products are ever commercialized.
Many, of course, are simply not worth a licensor's time, but more often the
inventor simply hasn't a clue about what to do next. Inventing they know;
patenting they know; everything else is a dark void.
Years ago, when Singer talked about his new sewing machine, he said he didn't
give a damn about the invention; it was the money he was after. Many inventors,
I'm afraid, have it the other way around. How can they invent for the
marketplace when they know nothing about it? Does that make sense? Does a tailor
custom make a suit and then look around for someone it fits?
I don't consider myself an inventor; I'm in the inventing business. I don't
invent for the joy of inventing; I create new products solely for companies to
profitably manufacture and distribute. Whether any product of mine winds up with
a patent is only incidental. Some do, some don't. But that only has to do with
the nature of the idea. It has nothing to do with its value. I don't know how
many products I've licensed over a long career (certainly more than a hundred)
and while I can't claim to have successfully licensed every product I've
presented, I can say that I've never been turned down based on whether my idea
was patented or not.
Someone in the inventors newsgroup recently posted that he and his wife
created a new product that couldn't be patented, and wondered if it was worth
pursuing. Someone else immediately logged on to tell this poor guy with great
authority to forget it. "No manufacturer would pay to license a product
that his competitor could knock off without penalty." This is utterly
wrongheaded advice and serves to illustrate how woefully uninformed many
inventors are about the business world. It should be obvious that manufacturers
introduce non-patented new products every day of the year. In this fast moving
economy of ours, they understand that the one who's first with a product can add
millions to his bottom line before the competition even learns of the product's
existence. You show a marketing executive a great product, patented or not, and
he'll be ready to do a deal. Those who run these companies may be venal, but
they're not stupid.
If your inventing activities haven't yet brought you the rewards you feel you
deserve, let me gently suggest a different approach. First, don't invent
anything . . . at least not yet.
Before you do anything, select an industry that interests you. Next, wander
through stores, go to trade shows, read industry magazines, talk to retailers
and wholesalers and keep at it until you feel confident that you understand how
that industry works (along the way, it wouldn't hurt if you also read a book or
two about marketing.) Next, assured that you understand the industry, select a
company that's close enough to home so that you can easily get to it, and
concentrate on inventing a product for that company.
Repeat after me: Learn the market first, then create the product. When you do
it the other way, you wind up supplying solutions to problems that don't exist
and providing answers to questions that have never been asked. When you
understand the dynamics of the marketplace, how products are bought and sold and
how profits are made, you won't waste time inventing a product that could never
attain sufficient volume to warrant a licensor's capital investment. Also,
before investing your time and money, get an expert without an ax to grind to
give your idea an honest appraisal.
Next, because you targeted a company close to home, you'll be able to make a
first-hand, first-class presentation. When I present a new product idea to a
prospective licensee, more time is spent in discussing how to market it than on
the product itself. I show a great prototype in a great consumer package. I show
him what it'll look like in a store. I tell him what it'll cost to produce, what
kind of mark-up he can get, how my product beats out the competition, and a
best-guess estimate as to how much volume he can expect to do. I give a turnkey
presentation with all the bells and whistles. All my prospect has to do is nod
"yes." I even have a contract in my briefcase and have more than once
walked out with a signed deal and a check in my pocket.
If you try to make a presentation by mail, nothing will happen. Your
presentation will probably wind up in the wastebasket. If you visit personally,
there can only be a few outcomes, all of which are beneficial.
The worst-case scenario is that the guy will think your idea stinks. So what?
Maybe it does have a fatal flaw . . . isn't it good that you found out? Move on.
Be a pro. If you can come up with one idea, you can come up with another. In the
meantime, you've developed a contact.
The next scenario is that the executive won't like your idea, but if you
listen closely, you'll learn what he would like. "Nah, I can't use this,
but I'll tell you what . . . if you could come up with . . . (fill in the blank)
. . . then we'd really have something to talk about." Now you have some
direction. With the problem recognized, the solution is just a matter of
application. Next, maybe there's nothing wrong with your idea, you're just in
the wrong place. "Nope, it's a nice idea but I'm afraid it isn't for us.
But you know what? If you show this to Universal Whiplash, I think it might be
right down their alley. Ask for Frank Snerdley, and you can tell him I sent
you." Well, not only do you now have one contact, but you're on your way to
making another.
Finally, the best thing that can happen is the guy loves your idea, and is
ready to do the deal. None of these events happens through an unsolicited
mailing.
The professional product developers I know all work in this manner. Before I
sit down at the drawing board to create a new product, I've already selected the
industry, selected the target company (plus a few back-ups), and wandered
through stores until I sensed a niche. Before I embark on a voyage of
creativity, I know exactly where I'm heading, why I want to get there, and what
to do when I arrive. There's nothing serendipitous about it.
If you're not yet successful, perhaps you're going about this inventing
business in the wrong way. Don't get hung up on the process of inventing and
protecting. Yes, of course certain products warrant patents and ordinary
precautions should be taken. However, before worrying about the patents and the
non-disclosure agreements and first-to-invent laws and the fears that someone
might steal your idea, worry about its place in the market and the needs and
requirements of the guy you hope will license and produce it. He's the one
writing the royalty checks. If you make him happy, everything else will fall
into place.
Don't worry about the egg, worry
about the chicken.
# # #
Harvey Reese
Money4ideas.com
PS: Check out his newest book: “The
12 Amazing Secrets of Millionaire Inventors.”
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