The Product

This is probably the chapter with which the writer is most confident but with what the reader is least familiar. Every effort must be made to explain the technology in simple terms and to explain the Unique Selling Proposition (USP) of the invention.

This chapter must answer the questions relating to what the product or service is and why anyone would want to buy it. In marketing terms products can be divided into two classes (see chapter 2 also):

- Market pull
- Product push

The market pull type of product is defined as having been conceived as a result of an identifiable unsatisfied need. The product push type of product is brought into existence as a result of an invention or development for which an application has to be found. Both of these types of product can be successful but experience shows that the success rate for the market pull type of product is significantly higher than for the product push. Often a product is created as a result of a combination of these two approaches.

Typically, the product push type of product arises from the work of a company’s research or development department as does process innovation. e.g. the invention of polyethylene.

This may be the extension of an existing product range or perhaps a spin-off development which is considered to have potential application in a completely new sector. The market pull product arises as a result of the company’s marketing effort which involves understanding their customers’ problems. Information on customer needs and dissatisfactions will be gained on an ongoing basis by the company’s regular sales force. This will be supplemented on a general and specific basis by market research consultants. Once the need has been clearly identified, the specification of a product is drawn up which would solve these problems and work is then undertaken to develop such a product.

The vital aspect to emphasise in this section is the need to identify just one Unique Selling Proposition for the new product. Some possible USPs are:

- lower price
- higher quality
- longer life
- faster operation
- rapid maintenance
- comprehensive back-up service
- smaller size

Then you must indicate how important this USP is to the customers in value terms. It will be necessary to compare your product with others from competitive suppliers. These should be analysed in terms of the end use segments of the markets which they serve, their USPs, their draw-backs and weaknesses, pricing, etc. This will enable the differences and advantages of the proposed product to be seen more clearly in the context of its market potential.

In the case of a process innovation by an RTD or technical department the customers are likely to be internal rather than external i.e. a manufacturing, production or finishing department. While it is still necessary for the RTD department to communicate the USPs to an audience, the benefits need to be, presented in a slightly different way e.g. improved productivity may mean that expensive machines may not need replacement. Alternatives include warranties could be granted or scrap levels and inventory stocks reduced but whatever the benefits the RTD department still needs to convince customers. There may also be additional spin-offs from technology which the marketing department may be able to exploit and which can form part of the business plan.

The question of patents on the new product needs to be examined thoroughly and the impact the patents will have on the marketability of the product.

CHECK LIST
- Describe the product, process or service in simple terms.
- Is it available for sale and if not when will it be ready? At what cost?
- Do you have legal protection and if not why not? Have you taken advice on patents?
- What is the Unique Selling Proposition (USP) of the product or process?
- Will you provide other services such as warranties, guarantees or after sales service?