Ryan Allis, CEO of the marketing and online communications firm iContact Corp., in his book “Zero to One Million: How I Built a Company to 1 Million in Sales … And How You Can Do” has a great section on what makes a product great.
According to Allis, the perfect product has the following attributes:
- It fulfills a need or want
- It has either niche market appeal or mass market appeal
- It has at least a 2:1 markup ratio; 5:1 or higher is optimal
- It has a high perceived value
- It must be replenished or repurchased by the consumer often
- It is easily up sold and cross-sold
- It has a related backend product
So how do you know if your product is great? To find out, you need to assess your product against two factors: inherent qualities of the product and the state of the marketplace.
Inherent Qualities of a Product
- Is the product of high quality?
- Is the product effective?
- How valuable are the benefits the product gives to the consumer?
- Does the product increase pleasure, increase utility, or reduce pain?
- Must the product be reordered?
- Can the product be developed easily?
The State of the Marketplace
- Can it be obtained or produced for a low cost so as to support a high margin?
- What is the current demand for the product?
- How many other competitors are selling the same or a similar product?
- How many serious competitors are there?
- What are the sales figures of these competitors?
- What are the product’s substitutes?
- Are there any factors that might increase or decrease sales of substitutes?
- How hard will it be to differentiate the product from competing products?