Boom StartSuper Laws of Successful

Entrepreneurs

Gary RhoadsS

tephen Mack Covey Professor of Marketing/Entrepreneurship

Lessons Learned from 10 years of

research with Entrepreneurs

Successful BYU Student Entrepreneurs

My Entrepreneurial ExperiencesMy Entrepreneurial Experiences

We want to increase the likelihood of student success!

Proprietary idea Exceptional qualifications Significant capital

What You Don’t Need

What You Do Need!

AngleHorseEvents

Entrepreneurial R&D

Rip-off... identify a good idea from your neighbor where there is significant pain or opportunity

Design... modify, add to, take away, make it harder, use it differently, or completely change the product by sharpening the angle

MethodMethod

1.1. Take something outTake something outof your productof your product

2.2. Put something inPut something inyour productyour product

3.3. Answer to consumerAnswer to consumergripesgripes

4.4. Visible differenceVisible difference

5.5. Make the taskMake the taskeasiereasier

6.6. Use products in aUse products in anew waynew way

7.7. ProductProductsubstitutabilitysubstitutability

8.8. Don’t be literal,Don’t be literal,be creativebe creative

9.9. Look overseasLook overseas

ExampleExample

Royal Crown removedRoyal Crown removedcaffeinecaffeine

Adding fruit juice toAdding fruit juice tosodasoda

““Locked my keys inLocked my keys inmy car”my car”

““Same old cereal”Same old cereal”

Time-consumingTime-consumingoven cookingoven cooking

Wine mixed withWine mixed withseltzerseltzer

Cereal substitute forCereal substitute forcereal-avoiding teenscereal-avoiding teens

A healthy PopsicleA healthy Popsicle

Healthy BreakfastHealthy Breakfast

ResultResult

First decaffeinated colaFirst decaffeinated cola

SliceSlice

Warning bellWarning bell

Adding X’s to the O’s in CheeriosAdding X’s to the O’s in Cheerios

Jet Stream OvenJet Stream Oven

Wine coolersWine coolers

Total Breakfast BarsTotal Breakfast Bars

Dole Fruit Juice BarsDole Fruit Juice Bars

Yoplait YogurtYoplait Yogurt

Nine methods for Developing New Angles/CategoriesNine methods for Developing New Angles/Categories

Super Law #1:Sharpen The Angle

Five Dimensions of an Angle

1.Need to Believe

2.Reason to Believe

3.Blows-Away Expectations

4.Quantifiable Support

5.Unique Product Claim

Big Problem = Big OpportunityQuickTime™ and a

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Nobody will pay you to

solve a non-problem!

Sharpen the Angle - NTB

1. Need to Believe - Is there enough pain or opportunity to make people pull out their credit card?

What are the problems with

keeping warm & comfortable when

skiing?

Klymit Solves the Problem

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Klymit Products

Five Dimensions of an Angle

1. Need to Believe - Is there enough pain or opportunity to make people pull out their credit card?

2. Reason to Believe - Does the product “touch the human sense of believability” with a compelling proof-point?

My mama always said, “seeing is believing!”

Which has the better RTB?

Golfers want to putt the

ball straight... so which putter

has the strongest reason to believe?

A B

Strong RTB = Strong $ale$

GOLD (EDITOR'S CHOICE)ODYSSEY WHITE HOT XG 2-BALL SRTSTREET PRICE: $200.SPECS: Eight Versions (White Steel, White Hot and regular 2-Ball).KEY TECHNOLOGY: The 2-Ball uses golf-ball-size discs on the top of the putter to help the user align square to the target. The SRT has an alloy ring that pushes weight away from the center of gravity in the aluminum head, providing support and increasing moment of inertia.PANELIST COMMENTS: "It has become the standard others are measured against. . . . This well-worn design just keeps getting better every time they redo it. . . . The insert is an improvement over the White Steel in terms of feel."JUDGES' VERDICT: It's almost impossible to remember what putting was like before the 2-Ball. It's not a gimmick, certainly not in its latest technological form. The ring improved moment of inertia last year, and the White Hot XG insert creates a favorite feel this year.

Golf Digest - Hot List Again

Five Dimensions of an Angle1. Need to Believe - Is there enough pain or

opportunity to make people pull out their credit card?

2. Reason to Believe - Does the product “touch the human sense of believability” with a compelling proof-point?

3. Blows-Away Expectations - Does the product dominate a situation and deliver superior value?

Dominate the situation to nail the need!

Dominate a Usage Situation

Quickgut fill

Too tiredto cook

SingleworkingadultsMarried

nochildrenMarried

withchildren

Person

Situation

The Challenge Facing Technology Firms

Failure to Dominate

Suppose General Motors makes an electric car, and Ford and Chrysler follow.Let’s assume the cars work like any other, except they are quieter and better

forthe environment. Now the question is: When are you going to buy one?

Technology AdoptionTechnology Adoption

• “Not until hell freezes over”

• “When I have seen electric cars prove themselves and when there are enough service stations on the road.”

• “Not until most people have made the switch and it becomes really inconvenient to drive a gasoline car.”

• “I want to be first on the block with an electric car.”Innovator/Early Adopters

Latemajority

Earlymajority

Laggard

Crossing the Chasm:Winning Over Crossing the Chasm:Winning Over Pragmatists (Early Majority)Pragmatists (Early Majority)

1. Target a very specific niche market (person-situation).

2. Assemble the invasion force (partners, allies).

3. Define the battle (USP).

4. Launch the invasion (marketing mix).

Five Dimensions of an Angle

1. Need to Believe - Is there enough pain or opportunity to make people pull out their credit card?

2. Reason to Believe - Does the product “touch the human sense of believability” with a compelling proof-point?

3. Blows-Away Expectations - Does the product dominate a situation and deliver superior value?

4. Quantifiable Support - Are there facts and figures to enhance product claims?

5. Unique Product Claim - Does the product earn its way to occupy a unique position in a customer’s mind?

How do you compete with...

Coca-Cola and Pepsi?

Create a new category and dominate a

situation--extreme sports!

Sharpen the Angle - UPC

UniqueProduct

Valued by Customers

Flop

LowPrice

Your unique claim must be valued by the customer.

School Tipline

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Believing in Yourself and Working Hard:Is the Key to Entrepreneur Success, Right?

All things come to those who hustle while they wait. Thomas Edison

–High

–Med

–Low

Ride Horses!

The key to success in life is learning to believe in and rely on others

Find the sort of horses that you can ride to the bank

A fast set of horses increases your speed to market

It’s not about “what you know” ...it’s about “who you know”

A good horse will be a champion for your “blue ocean” angle

‘Stand Alone’ Success Factor

Super Law #4: Throw an Event

Best Practices:

Get ExperientialHave a Love Fest

Make Demonstrations Compelling

–High

–Med

–Low

Marketing Events

Marketing tactics are really marketing events

Events can be activities, exhibitions, hoopla, happenings, gatherings, tournaments, competitions, matches, races, games, etc

Having a focus on throwing Marketing Events reminds us that we are selling a consumption experience and not just a product

‘Stand Alone’ Success Factor

Will It Blend

–High

–Med

–Low

Success Factor

What to Demonstrate!

Blow Away Expectations by Showing off the relative advantage and fit with the day-to-day

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Entrepreneurial Quote to Live By

•If I had asked my customers what they wanted, they’d have asked for a faster horse. Henry Ford

TextText

How Entrepreneurs Do Research?

How Entrepreneurs Do Research!

How Entrepreneurs Do Research!

100%100%gut-feelinggut-feeling

Could be very riskyCould be very risky

100% research100% research

““Analysis Paralysis”Analysis Paralysis”GutGut IntellectIntellect

Entrepreneurs often use their instincts to make quick decisions

Some basic data can be relatively easy and inexpensive to collect helping to educate the intuition

Analysis Paralysis can defeat you

Is Marketing Research Worth the Expense? Is Marketing Research Worth the Expense?

A survey of small business managers in Texas revealed that

84 percent of those who conducted formal marketing research projects in the past three years felt that the information obtained was worth the money spent.

Overall, 58 percent said that they were able to incorporate the research findings into their decision-making process.

Only six percent reported that they were not able to implement the results.

Consequently, when small businesses do engage in marketing research the benefits usually exceed the costs.

-David J. Snepenger, Montana State University College of Business (http://www.montana.edu/wwwpb/pubs/mt9013.html)

A survey of small business managers in Texas revealed that

84 percent of those who conducted formal marketing research projects in the past three years felt that the information obtained was worth the money spent.

Overall, 58 percent said that they were able to incorporate the research findings into their decision-making process.

Only six percent reported that they were not able to implement the results.

Consequently, when small businesses do engage in marketing research the benefits usually exceed the costs.

-David J. Snepenger, Montana State University College of Business (http://www.montana.edu/wwwpb/pubs/mt9013.html)

Win the Swing!

✓Need to Believe✓Reason to Believe✓Blows-Away Expectations✓Quantifiable Support✓Unique Product Claim

But, use the Love Group to Sharpen the Angle by pinpointing

the passion!

LoveLove SwingSwing HateHate

Yes, the Swing Group is the biggest opportunity...

Used “gut-feeling”

Single biggest mistake they made in the beginning was not collecting data on customers

First 7 of 9 books failed

Could have saved hundreds of thousands of dollars and years of efforts

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Always Look for a Better WayDo Things Faster, Better, Cheaper!

TESTING IDEAS THAT STICK

Test multiple concepts to hide your “big idea”Reveal the concept, step-by-step, and watch for reactions!Ask for a summary and clarifying questions, but don’t be defensive about objections - smile and explore!Measure the WOW - are they ready to pull out their credit card and buy?Use the Six Thinking Hats on your favorite concept - carve yourself out some blue ocean!

What’s the WOW Process?

The “WOW” FactorThe “WOW” Factor

Does your Angle Create Interest in the Market?

Ideas are the new currency in corporate America. Walter Wriston

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Six Thinking Hats

✤ White Hat - Facts✤ Red Hat - Emotions✤ Black Hat - Negative Judgement✤ Yellow Hat - Positive Judgement✤ Green Hat - Alternatives and

Creativity✤ Blue Hat - Thinking about Process

Edward de Bono Hats...

How do you get consumers to be creative, and stop being persistently negative or positive? How do you get consumers to be creative, and stop being persistently negative or positive? The six thinking The six thinking

hats is a questioning approach to get consumers to be creative in seeing the total picture hats is a questioning approach to get consumers to be creative in seeing the total picture (positive, negatives, (positive, negatives,

opportunities, and potential problems) when developing and discussing new products or opportunities, and potential problems) when developing and discussing new products or ideas.ideas.

Wow Factor

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Hat Participent

**7 out 10 Average Score

Wow Factor

Six Questions You Need to Know

•Who.....is going to buy the product?•What....is the benefit they are buying?•When...do they make their purchase decision?•Where...do they expect to find this product?•Why......buy this vs. other brands/substitutes?•How.....do they buy and the use the product?

Gary RhoadsS

tephen Mack Covey Professor of Marketing/Entrepreneurship

Michael SwensonFord Professor of Marketing

David WhitlarkJ.C Penny Professor of Marketing

kendallhunt.com

Best Wishes for Success!

Marriott SchoolBrigham Young University