Business Magazine

9 Ways To Spot An Opportunity For A New Business

Posted on the 22 March 2017 by Martin Zwilling @StartupPro

smartphones-opportunitiesAs an advisor to startups and entrepreneurs, I often hear the myth that all new businesses must start with a great idea. I have to disagree. I believe the best entrepreneurs start by finding a large opportunity, and only then use good ideas to capitalize on that opportunity. The best opportunities are recognized from painful needs, plus a growing population of customers with money to spend.

For example, technologist entrepreneurs often come up with a new device or application, just because they can, and assume everyone will want one. Social entrepreneurs pitch me their latest idea for eliminating world hunger (producing algae), but may forget that really hungry people probably don’t have any money. It takes a real selling opportunity to sustain a business idea.

I just finished a new book, “The Entrepreneur’s Playbook,” by Leonard C. Green, which supports my view, and is full of practical advice for aspiring entrepreneurs, including easy ways to identify sure-bet opportunities, most not requiring any invention, before you finalize your innovative business idea. Here are some approaches that both of us recommend to get you started:

  1. Take a basic product and make it special (upgrade). Premium bottled water (Fuji), expensive coffee (Starbucks), and gourmet cookies (Mrs. Fields) are examples of what were once pedestrian products that have driven successful new businesses. Sometimes you need to take a commonplace item, like a cup of coffee, and make it an “experience.”

  2. Offer a no-frills version of a high-end product (downgrade). For example, Southwest Airlines eliminated all the frills that usually come with an airline ticket, and now they are a market leader, being copied by the majors. In supermarkets, everyone today knows that generic brands often offer more value and quantity, without giving up key ingredients.

  3. Find products that seem to fit together (bundle). Instead of requiring people to shop and pay for related items, combine them into one package. Today’s smartphones are more attractive than a separate phone, camera, computer, and software packages. Sometimes just including training and installation makes a product more attractive.

  4. Break existing bundles into separate packages (unbundle). This is obviously the inverse of the bundle approach. Home computers have long been offered in unbundled as well as bundled hardware and software, to allow for a lower entry cost and flexible configuring versus simplicity. Long-term warranties are now unbundled from appliances.

  5. If a product sells in one area, transport it to another. Importers/exporters make their living this way with products from different parts of the country or the world. The same concept resulted in the birth of franchises, which are essentially proven business models transported to new locations. The Internet is a business for transporting web services.

  6. Expand a narrow product offering to the mass-market. A popular incarnation of this approach today is to take an Internet-only product into brick-and-mortar retail for access to a much larger audience. The same concept applied to every startup which test-markets its product in a local area, then scales the business for national or global access.

  7. Take a broad-appeal product into a niche. With the widespread popularity of social media, I now see many businesses looking at niche market interest groups, such as sites for travelers, hunters, cancer support, and crafts. In television, this is called narrow-casting, to gear specific channels to a special audience, like golf, old shows, or history.

  8. Maximize the selection of products offered (think big). This approach brought us the “big box” stores, including Walmart, Lowe’s, and Home Depot. Online, the same concept has been implemented by Amazon and Alibaba. It allows customers to complete their shopping in one place, and businesses get the value of volume and common processes.

  9. Focus on in-depth expertise and support (think small). This is the inverse of the “think big” strategy, which you see at your local hardware stores, with knowledgeable and friendly support staffs. They specialize in the depth of their selections that a true connoisseur demands. Online sites now advertise customized designs and personal fits.

It shouldn’t be hard to see from these examples the wealth of business opportunities available without inventing a totally new product or technology. Thus I continue to tell entrepreneurs that business success is more about the execution, and the quality of the team, rather than the idea.

Also, by looking at the size of the opportunity, you can take a calculated risk, rather than close your eyes and step into the total unknown. Calculated risks are less likely to be fatal, and more likely to be fun and profitable. Think about it before you send me your next business plan to change the world.

Marty Zwilling


You Might Also Like :

Back to Featured Articles on Logo Paperblog

These articles might interest you :

  • Easy Breezy Summertime Looks

    Easy Breezy Summertime Looks

    Mid-Atlantic states are notoriously known for their humid weather in the summer. They rival the swamplands of Florida. The saying, "it's not the heat, it's th... Read more

    The 18 July 2018 by   Bridgetteraes
    FASHION, LIFESTYLE
  • The Xroadie Files

    Xroadie Files

    Revbjelde – Severance Mordecai Smyth – Mellotron, Andy Prince – Chapman Stick, Guest Musicians Severance slow melodic sounds that just seem to work... Read more

    The 18 July 2018 by   Ripplemusic
    ENTERTAINMENT, MUSIC
  • Trump and Putin Might Have Thought Helsinki Summit Was Private, but...

    Trump Putin Might Have Thought Helsinki Summit Private, Intelligence Agencies from Finland Sweden Likely Reported Almost Real Time

    Donald Trump and Vladimir Putin might have thought their meeting in Helsinki yesterday was virtually private, but that almost certainly was not the case, report... Read more

    The 18 July 2018 by   Rogershuler
    LEGAL, SOCIETY
  • Learn the Language of Your Brows "Browmoticons" | Happy Brows

    Learn Language Your Brows "Browmoticons" Happy

    Brows speak volumes about yourself, you can communicate with other people without even speaking with just using your eyebrows. A subtle arch can reflect your... Read more

    The 18 July 2018 by   Rayrose Camille Samson
    HAIR & BEAUTY, LIFESTYLE
  • Wildacres Report

    Wildacres Report

    That was the week that was. About a hundred writers convene on the mountain for a week of workshops, music, partying, and quite a lot of silliness. Read more

    The 18 July 2018 by   Vickilane
    CREATIVITY, PHOTOGRAPHY
  • Ultra-gorgeous Gala Montenapoleone Trunk Show and Bridal Party

    Ultra-gorgeous Gala Montenapoleone Trunk Show Bridal Party

    Love4Weddings Love4Weddings - A Stylish Wedding Blog Σήμερα, σας παρέχουμε μια μικρή γεύση από το ονειρικό trunk show του οίκου Gala Montenapoleane και του... Read more

    The 18 July 2018 by   Love4weddings
  • The Ultimate Romantic Wedding Inspiration | Love4Weddings Bridal Party

    Ultimate Romantic Wedding Inspiration Love4Weddings Bridal Party

    Love4Weddings Love4Weddings - A Stylish Wedding Blog Σε αποχρώσεις του απαλού ροζ και του αστραφτερού χρυσού, στολίστηκε ο υπέροχος εσωτερικός χώρος του... Read more

    The 18 July 2018 by   Love4weddings

Magazines