With the downturn in the economy, numerous people are talking about
starting a new business or company. Whether it’s a technology startup
or new restaurant idea, I’ve heard of more and more people meeting to
brainstorm and working to bring their ideas to fruition.

Whether you’re in the idea generation stage or have already started to
build your new thing, you should take a breath and reassess whether the
concept still holds your initial level of enthusiasm. Can still
envision 30 million visits during the first month? Are you still as
enthusiastic as you were when you came up with it? Do you believe your
product or service is a “must have” and not just a “nice to have”? If
not, step back – being a successful entrepreneur requires high – some
say insane – levels of dedication to your idea.

There’s a great scene in the movie “Something About Mary” where Ben
Stiller’s character, Ted, picks up a hitchhiker who is a psychotic
killer and budding entrepreneur:

Hitchhiker: You heard of this thing, the 8-Minute Abs?
Ted: Yeah, sure, 8-Minute Abs. Yeah, the exercise video.
Hitchhiker: Yeah, this is going to blow that right out of the water. Listen to this: 7... Minute... Abs.
Ted: Right. Yes. OK, all right. I see where you're going.
Hitchhiker: Think about it. You walk into a video store, you see
8-Minute Abs sittin' there, there's 7-Minute Abs right beside it. Which
one are you gonna pick, man?
Ted: I would go for the 7.
Hitchhiker: Bingo, man, bingo. 7-Minute Abs. And we guarantee just as good a workout as the 8-minute folk.

Comedy aside, how familiar does this pitch sound to all you
entrepreneurs or intrepreneurs out there? The reality is that the
hitchhiker’s idea was a “nice to have” and wouldn’t have threatened the
well-marketed 8-minute Abs video even with his insane level of
dedication. Of course, he’s not similar to your pitch about your
product, but does it remind you of your friends’ new thing? They all
hope to have the next awesome product that will change the world, or at
least get crazy traffic on Facebook. The driver of sales or user
adoption? It should be as obvious as a 7 minute workout being more
attractive than an 8 minute workout, right?

Most entrepreneurs are too close to their topic to realize where they
really are on the user adoption curve. As an entrepreneur, you’re
hoping that the jump from what Geoffrey Moore describes as “innovators”
and “early adopters” to the “early majority” is short, but
unfortunately, in reality, sales and user adoption rates are about as
easy to predict as blockbuster movies.

Must Have, Meh, or What Does It Do Again?
For entrepreneurs, one method to frame the product development process
is whether your product is a “nice to have” or a “must have.” Here,
“must have” is loosely defined and can be identified by answering
questions like:

• Is it easy for people to recognize that your product will save them a significant amount of time?
• Or a significant amount of money?
• Do people quickly see how much better it plays their music?
• How much better it allows them to access data?

For example, back in 2005, when I was working on my startup GoingOn
Networks, we identified a trend of blogging and social networking
entering the corporate world. We built a private-label social media
platform, thinking that companies would soon recognize this trend and
purchase our software-as-service platform.

In hindsight, the first two years were painful. A long education
process, working on quelling fears of “opening up” to customers, and
another long sales cycle. We were hoping our market chasm would be the
neighborhood creek, but we found out it was more like the Grand Canyon.
Plus, by 2007, about thirty competitors were also targeting this
market. I realized that our social media platform wasn’t a “must have”
and maybe not even a “nice to have” during our early years because our
target market first needed to be greatly educated on the benefits of
social media. It felt as if more often than not, sales meetings went
like this:

Me: “Open, two-way communication with your customers is more effective…”
Potential customer: “Like a walkie-talkie?”
Me: [Sigh]

For consumer plays where users don’t pay for the product, the “must
have” bar might be set a bit lower than for paid products, but it’s
still a significant hurdle for the early majority to spend their time
(even if it doesn’t cost money) on something new of which the benefits
aren’t obvious, easy, or quick to grasp.

So how do you figure out whether your insanely great idea is likely to
find customers and become a “must have”? When you’re trying to identify
“must haves” in the market, consider these techniques:

Trend Surfing. Extrapolate a current technology, trend, or “must
have.” What is the next product in the evolution of an industry?
Consider the evolution from the Walkman to MP3 players to the iPod. Or
look at what emerging technologies will create new market
opportunities. For example, Qualcomm and its CDMA technology. Or
exercise trends that created a whole new market of Pilates videos and
trainers. My personal favorite is the rise in popularity of specialty
bacon, where I can also plug my “Ode to Bacon.”

There are numerous examples, but the reality is that it’s difficult to
predict and ride such trends. I learned this from GoingOn, and my prior
startup, HeyAnita, when voice recognition technology was hot. With
competitors such as Tellme and BeVocal, our space raised over $300
million in 2000, but quickly faded a few years later when users didn’t
widely adopt a voice-controlled interface.

Twitter seems to have hit the right wave on the trend from blogging to
micro-blogging. Initially, it was just an echo chamber of Silicon
Valley people tweeting to each other, but now even major media outlets
such as CNN, ABC, and ESPN see communicating in 140 characters as a
“must have.” Like Twitter, if you do catch a trend wave, it swells, and
you execute well, then you could be golden, with a profitable tech
company or the best-selling line of Pilates videos on your hands.

Identifying a Market Gap. Where in the market is there an
underserved need? Is there a place in the market that a taste is not
being met? Chipotle filled a desire for fast casual Mexican food.
Netflix let people easily rent obscure movies and keep them as long as
they wanted without late fees. Meebo met the demand for a single,
unified IM platform. What element is missing in a market – one that you
know and are passionate about – that you believe you can fill as an
entrepreneur?

For instance, back in the old days before the majority of malware came
from websites and links to them, there was an opportunity for different
kinds of anti-malware products. Brian Kellner, now Newsgator’s VP of
Products, gave me some interesting insights into his days at
anti-spyware company Webroot in the 1990s: “Webroot was one of the
first two companies to release an enterprise anti-spyware product at a
time when Internet Explorer had a lot of vulnerabilities and anti-virus
companies didn’t catch spyware. The product was tremendously successful
because it really hit the pain avoidance and laziness needs.”

But as much as Webroot tried to make deployment and management of the
solution easy, when both anti-virus offerings and browser security got
better, the cost of owning and running a dedicated anti-spyware
solution became unattractive. “The pain level dropped significantly as
anti-virus companies added adequate anti-spyware protection and it was
much easier to just run the anti-virus software alone,” says Kellner.

So, for a while, Webroot was a “must have.” But when other, possibly
bigger, companies start tapping into the Market Gap you found and have
been filling, you need to find other ways to remain a “must have.” For
example, by trying to extrapolate to the next logical “must have” in
your market (Trend Surfing), or by making sure your product keeps
something attractively unique about it, or is just clearly the best of
its kind.

Building a Better Mousetrap. What product category is doing
well, but could be done even better? Do you have an idea for something
that will clearly be the best of its kind? IKEA did it for the
budget-conscious furniture retail market. Zappos.com turned shoe
shopping into a very convenient, easy, low-pressure experience. What
features are missing that could be implemented and allow a new player
to change the market? Friendster to MySpace and Facebook. MySpace and
Facebook provided more value that simply connecting with friends
through music and then third-party applications.

In speaking with Brian Rakowski, former lead product manager for
Google’s Gmail product and current Product Management Director for its
Chrome browser, he explained how he led the launches for these two
products and how to make them better than any of the competitive
products already out there: “Both Google Chrome and Gmail were new
entrants in existing spaces so we spent a lot of time getting to know
the market-leading products in their categories and identifying the
biggest user pain points. For webmail, it was small storage quotas and
clunky, inefficient interfaces. For browsers, it was general
instability and unresponsiveness, especially on advanced webpages.”
Google succeeded nicely with both of these, with Gmail surpassing
Youtube earlier this year as the second-most-visited Google property
and Chrome gaining just under 3% marketshare after one year. Rakowski
concludes, “In the end, the best way to test whether you have a “must
have” product is to threaten to take the prototype away from your early
users. If they don’t riot, start again.”

Brian has a great insight here. Would users of Microsoft’s Vista have
rioted if it had been taken away? No, there probably would have been
celebrations throughout office buildings all over the world. What about
Segway after all its hype? Maybe only mall cops would have grumbled.

Like the story of Webroot and anti-spyware becoming part of anti-virus
solutions, the Building A Better Mousetrap category also brings up the
importance of sustainability. How do you maintain being a “must have”
in your market? During the 1990s, my favorite search engine was Alta
Vista, but it didn’t maintain its “must have” status and gave way to
Inktomi, which eventually gave way to Google. Google has been
maintaining its “must have” status by not only staying on top of the
search algorithm game, but also by offering superior or extremely
competitive complementary products and services to its users: Adsense
and Adwords for advertising, and nicely integrated apps like Gmail,
Google Calendar, and Google Docs that make it easy to make Google your
default online place to get things done. (Yet even Google has had its
share of failures or incompletes such as Google Lively, Froogle,
Checkout, and Spreadsheets.)

Finally, with all three of these techniques for identifying a potential
“must have” opportunity – Trend Surfing, Identifying a Market Gap, and
Building a Better Mousetrap – keep regularly asking yourself “is mine a
“must have” product?” questions like the ones listed earlier. And of
course make sure you’re still insanely excited about your own idea most
days of the week – because if you’re not excited, it’ll be hard to make
others think of your product as a can’t-live-without-it “must have.”
But hopefully, these techniques and examples are giving you some extra
inspiration on how to get to the next step in your new great idea.