By Jay Hartenbach, co-founder and CEO of Medterra CBD.
I’ve read many articles about how to start a company with your “life-changing idea.” It goes like this: A scrappy entrepreneur has a life-changing idea, creates a business plan and hires the top talent. Together, they sail off into the sunset with all their riches.
This is not that article. The success of your startup doesn’t depend on some world-altering invention. In fact, the majority of startups simply optimize an offering or find a niche in the marketplace.
Is your idea original?
Pop quiz: Do you think you could spot the differences between the latest iPhone, Google Pixel and Samsung Galaxy? With their all-screen displays and high-powered cameras, you’d be hard-pressed to tell them apart. Does that mean they are unoriginal? Not necessarily. People often associate being original with creating a new product or service. Sure, that is one way of being original, but so is repurposing a standard offering for a unique, dedicated demographic.
You can also be original in how you develop that standard offering. For example, products made in the USA proudly wear that badge. Are identical products made abroad different from those made domestically? To some consumers, that answer will be an emphatic yes, and they are happy to pay that premium. On the other hand, maybe your company will be unique in how it can save customers money on that standard offering.
Eric Yuan started Zoom as a daydream in 2012. He became passionate about connecting people remotely after taking a 10-hour train ride to visit his girlfriend. At that time, Zoom was hardly a world-changing idea. Skype and Webex already provided similar services and were backed by huge corporations. So why does Zoom now have 300 million users worldwide? While Skype stagnated or even regressed, Zoom focused on continual improvement. With fewer dropped calls and more user-friendly features, Zoom went from obscurity to the top service in just eight years. Simply, it found an underserved need and executed accordingly.
Find a unique selling proposition.
So instead of asking yourself if this specific product is original enough, ask yourself if you have a unique selling proposition (USP). When we started Medterra, CBD was already available for purchase online. Because the product was not going to be 100% original, we knew our selling proposition had to be. In surveying the competitive landscape, we saw areas that were ripe for disruption.
At the time, CBD companies largely relied on dark, marijuana-themed packaging. This only encouraged consumers’ doubts about the quality and legality of CBD products. We saw this as an opportunity to introduce approachable, clinically themed packaging. Instead of dark colors, we focused on a combination of white and purple. We used supplement fact panels that clearly outlined what a consumer was taking.
Additionally, CBD was expensive, and the customer experience usually wasn’t the best. Customer service lines went to voicemail, and orders took 10 days to ship. We improved our selling proposition by working directly with the farmers and answering phone calls ourselves, which allowed us to lower costs and ensure quality.
There are many questions you can ask yourself, but here is a quick list to determine if you have something unique:
• Does it save potential customers money, time or stress? Dollar Shave Club did not invent a new razor. It simply improved the pricing and logistics of getting new razors.
• Does it cater to a unique demographic? Floyd’s of Leadville focused on selling CBD to the cycling and outdoor community. It offers standard CBD products, but that dedication to a unique demographic has created a unique spot for it in the marketplace.
• Does it solve a problem beyond its initial use? Environmentally friendly takes on existing products are incredibly popular. Boxed Water tastes the same as any other bottled water, but it reduces plastic consumption.
• Does it solve an existing problem in a unique way? Navy Seal Randy Hetrick wanted to exercise but didn’t have access to a gym. He created TRX bands, which is now a $50 million fitness company.
Determine if your idea really is unique.
With your USP identified, you are on your way to being a full-fledged entrepreneur. Now it is time to double-check. When most entrepreneurs are asked if they are working on something unique, they usually respond with an immediate yes. Be honest with yourself. Have you truly surveyed the market? Competitive research is no fun because most of us are secretly worried that we might just find someone else already running with our idea.
Even if you do find someone creating something similar, do not despair! It is better to find out now before you have committed significant time and resources. More likely than not, you will find a way to pivot and improve upon what that future competitor is offering. Start building a list of all competitors and identifying the ways in which they overlap with your idea. Where there is white space, lean in and pivot the overlap to areas that the competitor is weak in.
So congratulations — you have an idea that you truly believe in and is unique in the marketplace. Most hopeful entrepreneurs will never get that far. If you execute on that idea, maybe you will actually sail off in the sunset with your riches.