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Less Is More

Believe it or not, setting your sights a little lower could be the key to marketing your new product.

The Entrepreneur: Melody Ross, 31, founder of Chatterbox Inc. in Eagle, Idaho

Product Description: Chatterbox produces a variety of products for scrapbook enthusiasts. Ross has written six self-published books, including: The Scrapbooker's Best Friend, which is full of quotes and poems to include in a scrapbook; and Scrapbooker's Instant Interviews, which helps scrapbookers elicit great stories from their subjects. Her first breakthrough product was the Journaling Genie, a collection of 28 creative journaling templates that make it easier to create an attractive scrapbook. She also sells coordinating papers, embellishments (such as scrapbook windows), tags, borders and specialty fasteners and has patents pending on several products.

Start-Up: $5,000, which paid for an ad in a scrapbook magazine; printing costs for her first book, The Scrapbooker's Best Friend; a computer; and other office supplies

Sales: More than $2 million in 2002; $4 million projected for 2003

The Challenge: Creating a successful business without relying on a major chain to provide the bulk of your sales

Landing your product on the shelves of a giant, nationwide retailer isn't the only avenue to success. As many inventors have found, courting smaller, independent stores offers its own set of benefits. In fact, that strategy worked well for Ross, who's making millions selling her unique scrapbook products. Here's how she made it happen:

Steps to Success

BAD NEWS FIRST?
The news about new product launches in 2002 is good and bad, according to Productscan Online (www.productscan.com), from Marketing Intelligence Service Ltd., a leading researcher of new products. The bad news? Their count of new product introductions in 2002 hit 31,785, up sharply from 15,886 introductions in 1992. The good news is, only 8.8 percent of those products earned the company's highest innovation rating. These statistics suggest that big companies, which need to introduce new products often, may need the help of inventors to come up with truly innovative offerings.

1. Be innovative. Small stores must find a way to separate themselves from large retailers; after all, that differentiation is the reason people shop at independent specialty stores. As a result, independents like to carry unique products not sold by the competition. Says Ross, "One [word] that could always describe our product from the beginning is 'innovative.'" In fact, her Journaling Genie product line was awarded the Innovations Award in 1999 from the Hobby Industry Association (HIA).

2. Meet a key need. Ross noticed that people who buy scrapbooks and related products sometimes have trouble matching the right colors and creating a uniform look. "Matching products [borders, pages, tags and embellishments] is one of the most frustrating aspects of scrapbooking," says Ross. "Our new product line, Scrapbook Interiors, has pages marked with a paint chip so that matching our products is a breeze." The positive offshoot of meeting this need was that it ensured each store purchased a substantial number of products from Ross.

3. Find convenient ways to reach retailers. Ross started out with a small $400 ad in a scrapbook magazine, which generated enough interest to move her business forward. The ad was inexpensive because the number of scrapbook hobbyists was small at first. Today, Ross advertises in six magazines, including Creating Keepsakes, Memory Makers and Scrapbook Retailer Magazine.

Retailers also attend the HIA trade show held every January-another important place to meet contacts. "We [consider] trade shows as important as magazine ads," says Ross. "We get [many] new accounts at trade shows. This is the place we get to meet customers face-to-face-which is important, as this is a relationship business."

4. Provide customer service. "We feel it is important to offer first-rate customer service, because we are almost always dealing with the same person from each store," says Ross. "We tell our staff that they can stay on the phone as long as they need to with a customer to help them out and make their day." Ross also aims to ship orders out in less than 48 hours and offers free shipping for any back-ordered item. Customer service helps separate this small family supplier from big companies and leaves a positive impression on the independents.

5. Connect with retailers on a personal level. Independent retailers are in business because they enjoy relationships with people, and they want to do business with people they know and like. Ross knows how important relationships are. "[My husband and I] put our photos in our ads so people 'know' us." And because Ross attends trade shows regularly, she can make personal contact with her retailers.

6. Find a way to accelerate new products. Ross uses a product development company, The Better Mousetrap People (BMP, www.thetrap.com). When she came up with an idea for a new fastener, she turned to BMP. "I sent BMP drawings of what I was looking for, and within days, they returned engineered drawings and first-round prototypes," Ross says. "Later, they submitted bids to me from different factories and arranged a payment schedule I could handle. There was no way I could have pulled this off on my own." To find a reputable product development company, try these sites: the United Inventors Association and Inventors' Digest magazine.

Lessons Learned

AMAZON.COM WANTS YOU
Millions of people visit Amazon.com every week. Wouldn't it be great if they all had access to your innovative product? Now you have that chance: Amazon.com is currently looking for innovative products to feature on its site. For consideration, send an e-mail to ideas@amazon.com that includes the following: product description, price, how long it's been available (or its release date), where it's currently sold, who manufactures the product and how you currently distribute it. Following an evaluation process, some products will be selected for inclusion on the site. For details, log on to www.amazon.com/exec/obidos/tg/feature/-/413471/103-4492008-177345.

1. Make sure it's easy to contact the independent retailers in your industry. Independent stores exist in most markets, but it's not always convenient to contact them. For example, there are thousands of independent fishing and marine stores, but they don't have magazines that everyone in their industry reads or trade shows everyone in their industry attends. A market like this would be very tough for an inventor to sell to effectively.

2. Seek out new market opportunities. When Ross began, scrapbooking was a fairly new market. New markets change rapidly. Retailers prize innovation and seek products that meet customers' needs. But large companies often can't adjust their product lines fast enough to keep up with changes, so inventors have an edge.

3. Sell a product line that customers think is important. Retailers may or may not stock all the little extras and add-ons customers might like. But they always stock the broad product line, like Ross' line of papers, borders and accessories. Package your product into configurations that offer customers lots of value, and you're bound to receive big orders from the independents.

4. Love your product and your industry. Independent store owners are typically in business because they're devoted users of the products or are otherwise big supporters of the industry. Your enthusiasm for your product might not mean much to a big retailer, but it's a major advantage with independent retailers.

5. Avoid the big retailers. Independents like to sell a unique product line, and they'll often drop your product if it's available at a lower price from a mass merchandiser.


Don Debelak is the author of Entrepreneur Magazine's Bringing Your Product to Market. Send him your questions at dondebelak34@msn.com.

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This article was originally published in the August 2003 print edition of Entrepreneur with the headline: Less Is More.

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