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How to market a product idea?
Old 08-19-2012, 10:06 PM   #1
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How to market a product idea?

OK, odd topic for a retirement forum, but it is related. Retirement frees up more time for a bunch of different hobbies, and I fiddle around with various widgets and concepts for those hobbies. Well, one widget in particular seemed to have some real potential, and the more I thought about it as a product, and built some prototypes, the better my ideas became. I think I have a marketable product.

But I would need to get some parts machined/molded. At first, I thought this hobby market might be too small to even make that feasible, but now I realize this could have a far broader customer base. For a comparison, think about a product geared towards people who build race cars, but then it turns out that people who watch car races might want the product also - that kind of market expansion.

I met a guy who has the business background with the kind of machining/molding I might need, and he is also trying to break into this hobbyist market. When this idea was just geared toward the hobby market, I had figured that if he is interested in producing/selling/distributing the product, I'd be happy with just seeing the product used by other hobbyists, and I'd get some free samples to use.

But now that I see there may be a much bigger market, I'm thinking I should hold out for a piece of the action. But I don't want any direct ties to the business, I'd rather be treated as a 'consultant' or something - I don't want to worry about liability (anyone can hurt themselves with anything these days) or have to audit books to do profit sharing or something. Would it make sense to talk about a share of sales, like a licensing fee? Sales are easy to measure, profit gets all tied up in legitimate expenses and so on. I just want to keep it simple. I'm also guessing that even if this was very successful, we are not talking huge amounts of $ anyhow, so I don't want to sink money into it upfront. I suppose I should go for patents and everything before even talking to someone, but even that seems like overkill just to talk and see if this guy is interested. I plan on talking with him this week, thinking of just playing it by ear. Even on the off-chance the guy just wholesale rips my idea off and runs with it w/o me, I really would not have lost anything, as I know I just wouldn't pursue this totally on my own anyhow. Trying to keep it simple and low-key, I don't want it to turn into a 'job' - just an extension of the hobby, and if a few $ come in, that's great. But it would be 'fun' to see the product actually be produced.

Suggestions?

-ERD50
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Old 08-19-2012, 11:34 PM   #2
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Patent it and try to get a percentage of revenue plus however many working models you want. People can and will steal ideas i you do not have them nailed down. If you go for a percentage of revenues you will still have to figure out how to audit the revenues.
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Old 08-20-2012, 09:41 AM   #3
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Thanks, yes going for a % of sales, or a $ amount per part sold would require some auditing. But it seems far simpler to measure sales $ or quantities than to determine profit.

It takes several thousand $ to get a patent, and I'm not sure I'd want to go through that, at least not until I talk to some people about the feasibility of manufacturing this part cheaply enough at high quality. I suppose I could try to talk to a production shop, and get quotes, but I'm really looking for input on the best and cheapest ways to produce the part - I'm not sure some shop would want to spend much time with a small time guy like me, who doesn't even have a business set up.

True, this guy absolutely could rip off my ideas, but I'm thinking that is a chance worth taking, all things considered. Since this is a hobby based market to start, one that this guy wants to get into, if he ripped me off word would get out across the hobby - I have lots of connections in the hobby, and enough 'cred' on some of the hobby forums. I don't think this guy would want any bad publicity.

Assuming this guy would want patents, I'd be fine listing us both as co-inventors (since I expect he'll have valuable input on construction details), if he wants to invest the bucks in the patent. Maybe if I ask for $X.XX per part sold, that is after patent costs are covered - something like that. Just trying to get some ideas before I talk to him (I've emailed him with a general description, and he wants to talk). This isn't something I'd expect to turn into real big bucks anyhow, but it could get to be significant. It might be more pride than anything that makes we want to get some $ out of it if it is successful.

-ERD50
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Old 08-20-2012, 10:32 AM   #4
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ERD, check out Schmidling Productions and maybe consider dropping him a line: Schmidling Productions Beer Page

He has developed products for a few hobbyist markets (most notably brewing and cheese making) and apparently been quite successful. I own one of his maltmills and it is built like a tank. From what I have seen from published forum comments, etc. he seems to be not exactly a natural salesman (abrasive, I would say), but he has developed good products and rolled them out to good sales. He might be able to offer you suggestions on how to execute on a good product idea because he has done it several times.
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Old 08-20-2012, 10:54 AM   #5
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Kind of makes me think of the show "Shark Tank" where these inventors pitch their ideas to these folks who may or may not buy into the invention.

I haven't watch the show that much but remember an episode where a woman was pitching her product called a "CitiKitty" to help train your cat to use the toliet. During the pitch, some of the possible investors were pretty brutial (one guy said he hates cats, another made pretty sexist comments).

I think when marketing a product, one has to have pretty thick skin as you may have a product that you think is the best thing since sliced bread, but the folks doing the investing might in the opinion or (own motive?) flat out turn your idea down.

BTW... That CitiKitty actually sells on Amazon.

City Kitty Cat Toilet Training Seat on Shark Tank Small Entity

Amazon.com: CitiKitty Cat Toilet Training Kit: Pet Supplies

The pictures on Amazon of people posting of their cats using the toilet cracks me up!
But I couldn't see sharing the toilet with my cats.
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Old 08-20-2012, 10:04 PM   #6
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I have launched my fair share of products, from the business side, while working for a national company. I have a bit of a bias that you would be wise to work with a business person who can guide you through some of the pitfalls. Getting the prototype is a terrific accomplishment. Moving it to the next step will be another great accomplishment. Good luck.
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Old 08-20-2012, 10:38 PM   #7
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Quote:
Originally Posted by ERD50 View Post
But I would need to get some parts machined/molded. At first, I thought this hobby market might be too small to even make that feasible, but now I realize this could have a far broader customer base.
The methods and the costs for tooling have changed drastically in the last few years. Likewise some machining has become more affordable and available to smaller production runs and/or individuals.

A patent can take several years and a lot of money. I have several (Mega-Corp paid for them). The value of the patent by itself is not that big a deal, it just gives the lawyers something to fight over. If a big company decides to step on your idea, all the patent is going to do is give you a chance to sue them, assuming you have the money to feed your lawyer. Most patents can be worked around, but if you have a truly revolutionary and unique idea, perhaps the patent is worth it.

I would suggest that the biggest challenge is on the sales and distribution side. The bigger the game, the tougher this will be.

If tooling is your sticking point, you need a non-interested party to swag out what is really involved to tool the product, and what manufacturing costs might be. Then you multiply that by a minimum of 5, and see if you can sell anything at that price. Figure out the potential volume, potential profit, and then you know what and who to talk to.

Drop me a PM and we can chat.
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Old 08-21-2012, 08:31 AM   #8
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Originally Posted by davef View Post
I have launched my fair share of products, from the business side, while working for a national company. I have a bit of a bias that you would be wise to work with a business person who can guide you through some of the pitfalls. Getting the prototype is a terrific accomplishment. Moving it to the next step will be another great accomplishment. Good luck.
I've got several prototypes - each uses a somewhat different production process; fully molded, some metal work, mostly metal. These are just to demonstrate the concept, I've been using some more 'handcrafted' prototypes for over a year - but those don't lend themselves to production runs.

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The methods and the costs for tooling have changed drastically in the last few years. Likewise some machining has become more affordable and available to smaller production runs and/or individuals.
Yes, I've seem a lot of cool advances. That's one reason I'm interested in getting this other guy involved - he's totally up on all that.

Quote:
A patent can take several years and a lot of money. I have several (Mega-Corp paid for them). The value of the patent by itself is not that big a deal, it just gives the lawyers something to fight over. If a big company decides to step on your idea, all the patent is going to do is give you a chance to sue them, assuming you have the money to feed your lawyer. Most patents can be worked around, but if you have a truly revolutionary and unique idea, perhaps the patent is worth it.
Agreed. I know my MegaCorp (and all others) patented everything, and then traded them like baseball cards in disputes. And it is tough to get specific enough to cover the key aspects, and not have ways for others to get around it. And my idea is not revolutionary, it is just a 'much better mousetrap', but I've put a lot of thought into how to apply this to a larger audience (but not a huge - but larger than just the hobby market) - nobody else has done that (that I'm aware of).

Quote:
I would suggest that the biggest challenge is on the sales and distribution side. The bigger the game, the tougher this will be.
Another big reason I'm interested in working with this other guy - he already has a lot of that set up, as he is trying to break into this same hobby market.

Quote:
If tooling is your sticking point, you need a non-interested party to swag out what is really involved to tool the product, and what manufacturing costs might be. Then you multiply that by a minimum of 5, and see if you can sell anything at that price. Figure out the potential volume, potential profit, and then you know what and who to talk to.

Drop me a PM and we can chat.
Sounds good, but I'm just not sure if any kind of manufacturing place would be interested in talking to me. I don't have a business set up, I don't have the distribution/sales you mentioned.

Thanks all for the inputs.


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Originally Posted by easysurfer View Post
Kind of makes me think of the show "Shark Tank" where these inventors pitch their ideas to these folks who may or may not buy into the invention.
I saw that a couple times, entertaining, but I didn't really 'get it' (or maybe entertainment is all they were after?).

Some of the people (I googled after the show) already had these products on the market, and had great reviews, and seemed to have an established business (the folding guitar guys). I think they just wanted to get on the show for the publicity, they didn't need any deal from the 'sharks'.

And how do you commit to giving up 50% of your business for some vague verbal promise - ' I'll help you get into xyz stores and give you great support! Take my offer now! '. The actual deal parts must be phony - maybe they settle (or decline) on something on paper with details later? I'm kinda curious how it really works. But it is entertaining.

-ERD50
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Old 08-22-2012, 07:49 AM   #9
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You might want to talk to a patent attorney and get advice. I suspect just filing for a patent may be a good idea if this is a real money maker vs the time it takes to get it approved. That said, if you do not want to go that route quite yet, I would at least prepare a good Confidentialty/Non-Disclosure Agreement between you and the party you would share the idea with to protect youself.
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Old 08-22-2012, 09:02 AM   #10
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.... That said, if you do not want to go that route quite yet, I would at least prepare a good Confidentialty/Non-Disclosure Agreement between you and the party you would share the idea with to protect youself.
That's what I'm leaning towards. A simple dated, signed NDA-style document to list the items we discussed. This protects him so that I can't come back later and say something else he did was 'my idea', and vice-versa. Seems simple, and reasonable enough at this stage.

-ERD50
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