Planning Startup
Product Definition

The first thought most people have when asked “What is your product” is “This is EASY. I know what my product is and I can define it no problem.” Of course people think they know what their products is, but like most things in business defining the product may be harder than you think. What REALLY is your product? How does it relate to your vision?

Please read this story about the American Girl Doll as you begin to plan your product

Most business success or failure is determined by creating a well-defined product definition that matches your mission, vision and is part of your planning startup.

Why is planning startup product definition not always easy?

Let’s think about product definition using my dad’s grocery store as an example. This is an easy product definition, right? He has a store to sell groceries to the local population. But if you look more closely it’s not that simple. Remember my father’s planning startup vision was to have 100 stores, so with such a broad vision specific product definition is ESSENCIAL.

My father’s first grocery store had food, clothing, sewing supplies and a lot of other general merchandise. Because it was in a rural setting it was more of a General Store than a grocery. Also, because there was a fabulous meat cutter next store my father’s store didn’t sell meat (Meat is a VERY expensive part of any grocery store).

My father took this product definition, a general store with no meat section and started other stores in non-rural areas and failed miserably. Why? Because he didn’t truly understand his product definition; he thought his product definition was a grocery store for the local people. But in hindsight he realized that his product definition was a rural general store that had to have a fantastic meat market right next store. Not a great product definition to expand to 100 hundred stores.

What are the parts of a good product definition? Defining your product should be the most time intensive part of your business planning. Avoiding product planning is commonly why people choose a franchise business because the product work is already done (See franchise click here)

Good product definitions are specific, marketable, profitable, achievable, easily understood/intuitive, easily communicated and objective.

Examples of Good Product Definition

Let’s continue the grocery store example. Wal-Mart has done an outstanding job of product definition for a general store that sells groceries. I’ve never shopped there but I know they have a full-service grocery store with very favorable pricing. Again, they have a relatively simple product definition that is very well executed fitting well within Sam Walton’s original vision.

What about DK Designs, which was described on the home page? What is Deanna’s product definition? Deanne wants to create one-of-kind jewelry to sell in her local geography? Is this enough of a product definition?

Is it specific, marketable, profitable, achievable, matches your vision, easily understood/intuitive, easily communicated and objective?

I think not!

Deanne’s product definition (like many artists) is defined by what SHE wants to produce. That’s fine as long as she accepts the fact that what she wants to make isn’t what the market wants to buy. Therefore I would say that her product definition IS easily understood/intuitive and easily communicated. But it IS NOT necessarily specific, marketable, profitable achievable or matching her vision.

But Deanne has already launched her business and has invested most of her funds to create her first set of jewelry; another common problem, putting the cart before the horse. The result does not look favorable.

Because Deanne has launched her business without a good product definition she isn’t likely to be successful (profitable) with her first launch. That doesn’t mean she can’t stop, re-tool and learn to be successful, but her initial launch is likely to fail.

Why am I being so negative? I’m not trying to criticize or pick on Deanne, but I’m trying to show you the importance of good product planning. Many, many businesses spend YEARS and YEARS with poor product plans causing poor profitability and much heart ache.

What Should You Do?

Spend weeks or months on your product planning. Analyze objectively and REALLY define what you’re selling, based on why people will want to BUY it. Once you have a product plan, use this list and re-analyze it BEFORE you spend any of your precious resources on it.

Make sure that your planning startup product definition is:

Specific, marketable, profitable, achievable, matching your vision, easily understood/intuitive, easily communicated and objective?

When you're comfortable with your product plan you can move to the next step: Planning Startup Sales to decide how you will sell your product