Thursday, December 18

A Market Audit...What's that?

We hear the word “Audit” and we instantly think about the IRS. But in the inventing industry the word audit means something good – it means information and that information means better decision making.

One of the first steps in developing a retail product, or getting a product idea ready for licensing is to perform what we call a “Market Audit” we use this tool to understand the current state of the market in which our new product is going to have to live.

In the early stages this is a far more important step than running to the patent attorney or hiring people to work on development. The Audit not only tells you important information about the market, but it lets you know the competitive factors that help you decide to more forward or not.

In conducting a Market Audit you need to first reduce the “product” down to its core function. This is important because audits are done based on function not just on like products. (see blog post )

Armed with your function – look for every item currently being sold that is a functional equivalent of what you want to market. List the information in a matrix so you can quickly see the 30,000 foot view of the entire market.

Information like – the store you found it in, the size, packaging type, price, color, benefits, distributor….anything you can think of that gives you a better feel for how this product stacks up to yours.

It’s not complicated, but it is important, so don’t skip this step, in fact make it one of your first steps and you will find it saves you a lot of money and time.

1 comment:

  1. Oh how I love your simple easy to ubderstand explanations and visual examples! And welcome btw to our STE Group!