02 Jun Entrepreneurs learn to assess potential ideas
MILWAUKEE – The Wisconsin Entrepreneur’s Conference continued providing industrialists with tips on how to flourish in a competitive market, with a seminar held Wednesday to provide information on assessing the market potential of ideas. Entrepreneurs and industry representatives listened to a board of business veterans, who shared strategies for making a product “survive and thrive” among investors and consumers.
Debra Malwecki, director of the University of Wisconsin-Whitewater Business Outreach Services, began by stating the biggest challenge for an entrepreneur is not the problem of coming up with an idea, but rather, making the distinction between a regular good idea and one that is feasible as a real market opportunity.
“If you are going to convince potential investors, employees or board members to get involved in your business, you have to communicate that market opportunity to them and be persuasive,” Malwecki said.
The panel opened with a presentation by Mark Blumenfield, the chief operating officer for RoleFlow, a Madison-based company which focuses on business management software. As head of a young company, Blumenfield shared some of the strategies which helped RoleFlow carve its niche into the market. First off, he emphasized the importance of moving past the ‘Eureka!’ moment and determining whether or not the idea is a financial winner. This requires understanding and research of the market, he said, by speaking frequently to others already in the field and pouring over reports and data for the project.
“Once we understood the opportunities, we had more in our product to present to companies in the field,” Blumenfield said of the research process. “It is surprising how many people will call you at an early stage, so don’t be afraid to make the calls.”
Blumenfeld also pointed out that a product needs to be kept alive through communication – with both feedback and marketing playing equal roles. The company must always keep the chains of communication open with customers, as it is through feedback that a product develops. Marketing is key as well, because without the early adaptors who learn of the product and begin to use it, it can never move into the mainstream.
“Perception is everything … like you test the product, you test the message,” Blumenfield said. “The end result was we ended up with a scalable product which we knew could hold its own against others in the market.”
Steve Crawford, the chief marketing officer of PKWare, provided another example for attendees – that of a long-established company altering its product development to fit the market. As a Milwaukee-based company which has been in the business of data compression since the 1980s and was one of the market’s pioneers, PKWare adapted its methods to data security and storage when both regulations on companies and the rise of the Internet turned it into a viable option.
“What they found was that a lot of people were using it as a security system,” Crawford said, referring to people using the data compression technology to back up and secure files. “It was growing into a clear market need that could be filled.”
Once he outlined the situation that had presented itself to the company, Crawford detailed the required steps to move to a new product platform. The key points he illustrated for moving into a new market were to find a way to distinguish his business from competitors in the eyes of the consumer, and find out how far the company could go for new resource opportunities.
In PKWare’s case, the transition was eased greatly by their prominence in the field of data compression, as virtually all computers and consumers had, at one point, used their ZIP technology. Additionally, the technology the company had already developed was in line with the rising market, as e-mail users wanted to both secure the data and make it easier to send – goals which needed data compression to work.
“We positioned the company as the provider and solidified our position,” Crawford said. “We had a great foothold in terms of how people use data compression.”
PKWare also possessed a strong research and development asset, with 25 percent of all profits going to the R&D department even before the issue of security came up. When security and storage moved to the top of the idea list, they were able to smoothly make the transition and focus resources on this new idea.
“We’re all about providing solutions that work with feasibility on data compression … the key is to push the state-of-the-art in terms of focus.” Crawford said.
Entrepreneurs who attended the seminar praised the focus of the seminar, and how it managed to center on the key ideas for keeping an idea viable in the market.
“The [tips to handle competition] were all very compelling points, identifying market opportunity and the customer’s problem specifically,” said Tobey Andropolis of Andropolis Painting, a supplier of advanced painting tools to contractors and “do-it-yourselfers.” “That is what everything is based on, the seed of every successful idea.”