Identifying new business opportunities

New products and new markets . . . they’re the life blood of any business. With increasing competition, more customer prospects, and shorter product life cycles, expansion into new markets combined with a regular flow of new products into the marketing stream is essential for continued growth and business.

How do we go about identifying these new growth opportunities? One of the obvious means is to conduct market research among customers and prospects. However, there are other means that can be just as effective, and often less expensive, for starting us on the new opportunity track.

One source of new product ideas is in our customer orders. Pull out several months of recent orders and examine them. Is the product mix changing? Are you getting more special orders than for standard products? What features seem most important in these special orders? Do these special orders imply new needs in the market that you are not meeting with your standard offerings? If so, it’s time to dig deeper into the reasons why.

Are you experiencing an increase in orders from new customers or, perhaps more importantly, are the orders coming from new types of customers? Are you getting more orders from new geographic territories, which may indicate a new untapped market?

A second source of new product ideas can be found in your customer service and sales departments. What are your customers and prospects telling them? What questions are they asking about product and service features and benefits? What are they asking for that you currently don’t offer? Customer service and sales are your first line contact with the market. Talk with them. Stress the importance of information feedback about market needs. Then, most importantly, listen to the feedback and use it as part of your opportunity analysis.

Third, follow-up on lost orders. Sure, you can lose an order because of pricing, delivery, terms, quality, or a number of other reasons. But, if you are losing orders because your products and service don’t meet the needs of the customer, it’s time to reevaluate your offerings against those needs.

Finally, listen to customers and prospects and follow-up. Listen on sales calls. Listen at distributor meetings. Listen during purchasing negotiations. Listen at trade shows. If a prospect comes up to your booth and asks whether your products will work in a specific application, don’t simply send him on his way if the answer is “no.” Find out more. The prospect may just have given you the idea for a new product opportunity.

Identifying new business opportunities is an ongoing process. You still will need the market research to further evaluate the ideas, but frequently many of the best ideas can be find right in your daily business operations.

Michael T. Brandt
April 1999

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Updated:
15-Jul-2003