It's Not the Cool, It's the Problem
Get out of the building! Get out from behind your computer! Talk to people!
That’s the mantra of the new business plan–the business model. The basic idea behind this is not to try and sell a product that’s cool; the world is full of cool products that didn’t sell. Dominoes’ cookie pizza, the Flip Video camera, Zune, Divx etc are all examples. The force behind a good business idea is to solve a problem. Let’s look at some examples.
Sylvan Learning Center. I used to be a Director of Education for Sylvan, and it was while working there in the mid-90’s that I discovered that education could be a retail business. As a teacher, I had never thought of education as a way to make money. It seemed kind of sacriligious, actually. However, Sylvan had discovered a problem–our over-extended public education system–and had found a way to solve it while making money. I think, by the way, every single student I had at Sylvan was in the public education system. I had no one from private institutions.
Walmart. When I was in elementary school, the idea of a one-stop superstore was not really on anyone’s radar. But as life got busier, the idea of doing your shopping in one place became more and more appealing. Combine that with low prices, and you solve a pretty big problem for middle class America. Walmart didn’t become successful because it was a cool idea, it became successful because it presented a solution for busy people on a budget.
McDonalds. While hamburgers are a cool idea, this wasn’t the only thing that made McDonald’s successful. The problem it solved, again, was for people with busy lives. Pulling into a McDonalds and grabbing a burger and fries was easy. The drive-thru made it even easier. Also, McDonald’s food presented another unique solution: kids would eat it without fuss. So the busy mom could, after a long day, easily and cheaply get food that their fussy kids would eat (we can discuss the health issues with such food at a later date).
You only discover problems by getting out and talking with people. What are some other problems the businesses you know about solved? Is this what made them successful?
Originally written: January 4, 2017