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What people want
Author: Meg DesCamp
Posted: April 21, 2014

Launching a product is more complicated than you think.

CONGRATULATIONS! You've created a product—a brilliant, new, groundbreaking product. You just know the world will welcome it with open arms, and you're ready to launch it into the marketplace. So, what do you do next?

Put down the champagne, say three Portland State professors with extensive business and research experience. Almost undoubtedly, your next step is to start over.

"Most new businesses fail because the founder makes a product or service simply because it's interesting to create or because it can be created," says Charla Mathwick, marketing and advertising faculty in the School of Business Administration. "However, that doesn't mean that it solves a current market need."

Professors Mathwick, Antonie Jetter and James McNames all teach and conduct research in the rapidly growing field of lean start-ups. Real-world business experience (Jetter and McNames worked in start-ups; Mathwick in corporate marketing) informs their approach to teaching about entrepreneurship.

They say successful product launches often spring from substantial refinements to an initial idea or product—a little-known fact that can trip up starry-eyed inventors. "The product ideas are always changed. It's never what you start with," says McNames, chair of PSU's Electrical and Computer Engineering Department and CEO of APDM, a movement monitors and wearable sensors company he co-founded.

When Nat Parker first conceived his and Michael Gray's Portland-based company GlobeSherpa, it was going to be a travel guide app for cell phones. "Today we call that Wikipedia and Google, but I thought of it first," he jokes. The 2010 graduate of PSU's Master of International Management (MIM) program cycled through numerous ideas in search of market need, and settled on a mobile ticketing app now used by TriMet, Portland Streetcar and transportation agencies across the country. Riders can buy a ticket on their smartphone and immediately flash it on their phone's screen for a bus driver or MAX inspector.

"Our product is for everyday transit riders," Parker says. "Mobile payments solve everyday problems."

ENTREPRENEURSHIP IS CHANGING, and start-ups are no longer considered "small copies of big companies," says Jetter, an Engineering and Technology Management Department faculty member. "The strategic questions that everyone thinks they have to ask—what is your five-year plan, what is your 10-year plan—are not helpful. They are much too structured for start-ups. The questions that need to be answered are much more basic, starting with 'Does anyone really need this?'"

Extensive contact with potential customers from the very beginning is a hallmark of lean start-ups. "Assume you know nothing. Get out of your building, so to speak," Jetter says. "You need to experiment and test your assumptions in the real world."

That can be difficult for some potential business founders. "For lots of engineers, it's much easier to develop prototypes than to actually talk to potential customers," McNames says. "But they really need to talk to people, see if there's a need and find out if their idea would fill that need."

McNames was conducting research at Oregon Health & Science University in 2007 when he discovered a market need in Parkinson's disease diagnostics. He was struck by the subjective nature of assessing the disease: Physicians give patients something to hold, and then visually measure how much their hands tremble. There was no way to consistently and objectively quantify the physical symptoms of the disease.

"I thought I could do better than that," McNames says. "As an engineer, I measure things all the time. I knew I could develop a way for physicians to quantify the symptoms."

His subsequent search for a movement monitor came up empty-handed. He consistently heard, "No, we don't know anyone who makes such sensors, but if you find one, would you let us know?" Working with two former PSU graduate students, he founded APDM, which produces wearable sensors the size of a wristwatch that monitor and record movement for medical, athletic and other uses.

MARKET RESEARCH doesn't have to happen in the field. As recently as 10 years ago, talking to people about product needs and desires required face-to-face conversations, often in expensive focus groups run by market research companies. Fortunately for cash-strapped entrepreneurs, most market research and investigation can now take place online, where Internet communities hold massive amounts of data for anyone willing to dig deep enough. "If there's a problem, there is an online group talking about it," Mathwick says. "See if you can find any evidence that the problem even exists before you go any further with developing your product."

Jetter and Mathwick both stress the importance of approaching online research in an impartial manner—which can be hard for the proud parent of a new product or idea. "You have to really articulate and examine your assumptions," says Mathwick, who teaches a class on innovation and identifying compelling problems in need of marketable solutions. "The solution must be market-focused, or it will fail. Too often, product creators find that their assumptions are way off the mark."

That leads to the next step in launching a new product: Establish an online presence to get your product out there and find what sparks people's interest. "Social media presents an unprecedented opportunity to inform people about your product or your product idea and get feedback," Jetter says.

Sometimes it's clear that the market is begging for a good solution to an urgent problem. Ryan Jenson is an Oregon farm boy and engineering genius who earned his bachelor's and master's in electrical and mechanical engineering from PSU. He was having a conversation with a family friend about crop spraying and realized that it is an all or nothing endeavor; there was no way to target a problem area with a crop dusting plane. "He mentioned that people were looking into spot spraying with technology," Jenson says. "I figured you could do that with robots."

With that idea, Jenson founded HoneyComb, a company that builds agriculture surveying drones that use imaging and mapping to precisely locate problem areas suitable for targeted spraying.

FINALLY, the experts say, don't try to launch by yourself. Parker worked with classmate Michael Gray, also a MIM program graduate, to turn his GlobeSherpa idea into something useful and marketable. McNames' APDM has a licensing agreement with the PSU Business Accelerator, and has increased revenue each of its six years. It now employs 16 people. Jenson combined his engineering virtuoso with two friends' skill sets—Ben Howard's software expertise and John Faus' marketing skills—to create an agriculture drone with potential for a worldwide market.

"Good ideas are worth pennies—they're the least important element of success," McNames says. "I would rather have a strong team, with trust, commitment and a terrible idea, than a great idea and no team, or a great idea and a team that works badly together. Product ideas are always changed, but a bad team will sink you."

Meg DesCamp, a Portland freelance writer, is a frequent contributor to Portland State Magazine.

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