Create a Product That Sells With 3 Easy Steps

This article is an excerpt from the Shortform book guide to "The $100 Startup" by Chris Guillebeau. Shortform has the world's best summaries and analyses of books you should be reading.

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Do you want to start a business but don’t know what you could sell? How do you create a product or service that’s going to bring in a profit?

The first step of starting a business is to create a product or service. Ultimately, your product needs to have worth. In other words, it should make people’s lives better or easier. Ideally, this product or service should also be something that you’re passionate about.

Follow these three steps to create a product or service that sells.

How to Create a Product or Service That Sells

Creating a successful product or service requires a lot more than simply transforming your passion or hobby into a business. If you have an idea, don’t rush to making it a reality just yet. Before you go ahead, consider the following questions:

• Could you invest a minimum of 20 hours per week into the field you’re passionate about?
• Do you like teaching others about that field?
• Do you enjoy most aspects of that field, even the seemingly mundane details?
• If you had to put an administrative process onto your passion, would you still enjoy it?
• Is there a market surrounding your passion?
• Are there other businesses in that market? 
• Do you have an idea of how your business could be unique in that market?

If you answered “yes” to all of the above questions, you’re ready to start developing your product or service. To do so: 

• Find your target audience.
• Create an experience.
• Stay open to new ideas.

1) Find Your Target Audience

As you create your product, determine who you’re trying to sell to. To do this, break your ideal customers down into demographics. There are two kinds of demographics:

• Traditional demographics include age, sex/gender, income, race/ethnicity, and location.
• New demographics include beliefs, skills, interests, passions, and values.

When building products around your target audience, consider the following strategies:

Strategy One: Jump Onto a Popular Trend

When deciding what you want to sell, look at trends that are popular with your target audience. These often pop up in the areas of dieting, fitness, technology, social media, and entertainment. For example, you could coach people interested in fitness through a trendy diet plan such as Whole30 or Paleo by giving personalized meal plans and grocery lists.

Strategy Two: Ask Your Audience

Using surveys and interviews, ask people within your target demographic what they’re looking for in a product—for instance, the issue that they’d like the product to solve. One of the most straightforward ways to get people interested in your business is to sell them a product they already want. When creating your questionnaires, include questions such as:

• What makes ________ a struggle?
• What’s your biggest question or concern about ________? 
• How can I help you with ________?

Once you have an idea about the products you’re looking to offer, reach out and ask for feedback on your ideas. You could ask people to rate your product ideas based on what they’d find most helpful or if they could see themselves buying any of the products in the near future.

The Decision-Making Matrix

Once you’ve conducted your market research, you may have so many product ideas that you don’t know where to begin. To organize your thoughts and determine which ideas are the best, use the decision-making matrix. The decision-making matrix contains four scoring categories, scored between 1 and 5:

1. Impact: Will this idea make an impact on my audience? (1 = no impact; 5 = immense impact)
2. Effort: How much time and effort does this idea require? (1 = a significant amount of effort; 5 = a small amount of effort)
3. Profitability: How profitable is this idea? (1 = not profitable; 5 = very profitable)
4. Vision: How closely does this idea align with my vision or mission? (1 = not remotely aligned; 5 = perfect alignment)

At the end of each row, tally the total score of each idea. When you’re finished, the matrix should look something like this:

Using the above example, you could reach the following conclusions:

• Idea 1 would likely be the best idea to move forward with because it scored the highest in the matrix. Though it would require a fair amount of effort, high scores in impact, profitability, and vision make it a concept worth investing in. 
• While Idea 2 may have scored lower in impact, profitability, and vision, it’s a project that requires little effort, meaning it may be a good side project for further down the line.
• Idea 3 may need to be discarded. Scoring low across the board, the payoff doesn’t seem to be worth the effort.

As you start your business, changing trends in the market may lead to new ideas. Don’t be afraid of exploring these avenues because they often reflect changes in customer demand. For example, consumers are more aware of environmental issues than ever before. This has created a market trend towards sustainability, which may create an opportunity for you to develop new products using recycled materials to appeal to this trend. 

The following are common sources of inspiration that could help you adapt to an ever-changing marketplace:

• Ineffective models: Observe other organizations that offer a similar product to yours and look for what works and what doesn’t. When you see something that’s ineffective, you can come up with a solution to offer your clients a more streamlined process. 
• New technology: Technology is changing and improving constantly. By keeping an eye on new technological trends, you can give your customers innovative and updated experiences. 
• Unexpected space: If you have a storefront or office space, be on the lookout for innovative space solutions. For example, if you run a clothing boutique, renting a former restaurant space to house your storefront may be a unique draw to bring in curious customers.
• Side projects: When a particular product or service is selling well, think about spin-off projects that could boost income or give customers a new experience. For example, if your acting coaching business is booming, consider starting a teacher training program for other acting coaches. 

2) Create a Product That Creates an Experience

When creating your product, focus on the experience that your product will create. To do this, think about the benefits of your product, or the ways that it can help your customer, not to its features, or the details of the product. Use the following three strategies to create a product that focuses on providing an experience:

Strategy One: Fulfill Unspoken or Unrealized Needs

Often, customers don’t know what they actually want. They may have an idea, but it’s your job as the expert to lead them to a product or service that’s going to give them an excellent experience that they didn’t necessarily anticipate. 

Note: This doesn’t mean ignoring their requests. If the customer asks for something specific, give them what they’re asking for. However, you can guide them in a certain direction or provide an additional service if you believe it’s going to elevate the value of their experience.

Strategy Two: Make the Customer Look Good

People often look for products or services that will help make them look impressive or skilled. When defining the value of your product, show your customers how your business can elevate them at home or in the workplace. 

For example, if you run an online course on website creation for aspiring web designers, you’re helping your clients gain the skills they need to successfully and efficiently provide their clients with stunning websites. Explain how your product will make them look like heroes to the people that they serve.

Strategy Three: Don’t Get Bogged Down With Unnecessary Details

Customers are typically looking for a simple, clear solution to their problem. If you bombard them with too much information about the details of your product in your marketing materials, they may get overwhelmed or confused, disengaging with the item or service in the process.

For example, if you’re starting a voice studio, don’t lead by explaining the intricacies of every single vocal methodology that you’ve studied. Simply explain that you want to help people become better singers and that you’re going to give them the tools to succeed. If they want to know more, they’ll ask.

3) Stay Open to New Ideas

As you start your business, changing trends in the market may lead to new ideas. Don’t be afraid of exploring these avenues because they often reflect changes in customer demand. For example, consumers are more aware of environmental issues than ever before. This has created a market trend towards sustainability, which may create an opportunity for you to create a product using recycled materials to appeal to this trend. 

The following are common sources of inspiration that could help you adapt to an ever-changing marketplace:

• Ineffective models: Observe other organizations that offer a similar product to yours and look for what works and what doesn’t. When you see something that’s ineffective, you can come up with a solution to offer your clients a more streamlined process. 
• New technology: Technology is changing and improving constantly. By keeping an eye on new technological trends, you can give your customers innovative and updated experiences. 
• Unexpected space: If you have a storefront or office space, be on the lookout for innovative space solutions. For example, if you run a clothing boutique, renting a former restaurant space to house your storefront may be a unique draw to bring in curious customers.
• Side projects: When a particular product or service is selling well, think about spin-off projects that could boost income or give customers a new experience. For example, if your acting coaching business is booming, consider starting a teacher training program for other acting coaches.

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