Tag Archives: business-plan

A “Felt Need” Is What Makes Us Buy

A “felt need” is what dif­fer­en­ti­ates a vit­am­in from an aspir­in: when we crave some­thing (relief from pain), a product that sat­is­fies that desire becomes a must-have rather than a nice-to-have. Real­ising this and re-fram­ing a product in terms of this crav­ing is an import­ant step in ensur­ing a pro­duct’s suc­cess, say Dan and Chip Heath, authors of the excel­lent Switch and Made to Stick.

Becom­ing aware of this idea is what led to the suc­cess of Net­flix and NetApp… as well as the demise of count­less oth­er com­pan­ies. In a brief art­icle describ­ing how re-fram­ing a nice-to-have product as a must-have is all about dis­cov­er­ing and exploit­ing a spe­cif­ic “felt need”, the Heaths look at Ray Bards failed attempt at get­ting his “vit­am­in” book pub­lished and how real­iz­ing this idea of a felt need led him to become a suc­cess­ful pub­lish­er.

If entre­pren­eurs want to suc­ceed […] they’d bet­ter be selling aspir­in rather than vit­am­ins. Vit­am­ins are nice; they’re healthy. But aspir­in cures your pain; it’s not a nice-to-have, it’s a must-have. […]

That aspir­in qual­ity is what Bard now looks for in a book. He says that suc­cess­ful books address a deep “felt need” – that is, read­ers hun­ger for the answers the book provides. Clas­sic examples would be diet books, per­son­al-fin­ance books, and books that prom­ise you mega suc­cess if you’ll just radi­ate pos­it­ive energy to the uni­verse, indic­at­ing your receptiv­ity to mega suc­cess. Bard has become a tal­en­ted diviner of felt need. Fully half of the books that he pub­lishes become best sellers. […]

You’ve heard the old say­ing “If you invent a bet­ter mousetrap, the world will beat a path to your door.” Don’t bet on it. The world’s felt need isn’t for a bet­ter mousetrap. It’s for a dead mouse. […]

When engin­eers or mar­keters or entre­pren­eurs get too close to their products, it’s easy to mis­take a vit­am­in for an aspir­in. If your team is flirt­ing with delu­sion, a little love might point you in the right dir­ec­tion.

Icon-Based Business Plans

Depend­ing on who you listen to, a busi­ness plan is either a waste of your time or an essen­tial doc­u­ment. A good com­prom­ise could be Peter Hilton’s idea to cre­ate a con­cise, icon-based busi­ness plan visu­al­isa­tion:

Inspired by the sim­pli­city and suc­cess of the Cre­at­ive Com­mons icons, which con­dense pages of inform­a­tion that no one ever reads into an eas­ily-under­stand­able sym­bol accom­pan­ied by a sen­tence of text, Peter pro­poses to apply that exact same logic to busi­ness plans. In real­ity many sub­mit­ted busi­ness plans are simply not read by investors – they are too long, too bor­ing, or too con­vo­luted. Nat­ur­ally, the entre­pren­eurs who write them want to go into as much detail as pos­sible in their plans while the investors that read them just want to see the very core points.

In his talk present­ing the idea (pdf, loc­al mir­ror), Hilton pro­poses a series of icon-descrip­tion pairs for a num­ber of busi­ness plan sec­tions:

  • About the team (e.g. We can build the product – our CTO is a geni­us).
  • The idea (e.g. We plan to execute a proven concept).
  • The product or ser­vice (e.g. We have a demo or pro­to­type).
  • Rev­en­ue mod­els (e.g. We plan to mon­et­ise our ser­vice later on).
  • Fund­ing (e.g. We need series A fund­ing).
  • Part­ner­ships (e.g. We need an investor with a busi­ness net­work).
  • Return on invest­ment (e.g. We have a cash-flow pro­gnos­is).

The idea was appar­ently not inten­ded to be taken ser­i­ously, but it seems to solve a prob­lem.

Update: Hilton’s now cre­ated the Plan Crunch­er.