The Entrepreneurs: Scott Androff, 44, and Bruce Hilsen, 56, co-founders of Twin Star Industries in Bloomington, Minnesota
The Product: Atmosklear Odor Eliminator, introduced in 1998, is a nontoxic, biodegradable spray that eliminates odors. The product is different from other odor fighters because it doesn't just mask an odor; rather, it chemically attacks whatever is causing the odor. Androff developed the product in 1997 after his grandmother broke her hip and couldn't let her dog out regularly.
About 30 percent of Atmosklear's customers are individuals who buy from Twin Star's toll-free number or Web site; the rest are businesses with odor problems, such as hotels and car dealerships, and retailers such as hardware stores. Atmosklear is also sold on a private-label basis to GM. Spray bottles sell for $9.99 each, while a case of Atmosklear runs $200. Atmosklear is now looking for entrepreneurs who want an exclusive territory to expand their sales.
Startup: approximately $5,000
Sales: $800,000 in 2003; $1.5 million projected for 2004
The Challenge: Introducing a new product into a crowded market and competing against giants like Procter & Gamble
New inventors tend to lose heart when they realize how challenging it can be to launch a product that competes directly with well-known goods from large corporations. Clearly, Scott Androff and Bruce Hilsen's odor-eating spray faced its share of competitors, but that obstacle didn't deter these business partners from achieving success. They were determined to get their product in front of customers to prove it worked. The strategy succeeded, and it didn't break their budget. Here's how they built a million-dollar business in a market already teeming with odor sprays.
Steps to Success
1. Demonstrate that your product works. There are at least 15--and probably dozens more--odor-fighting products on the market. People can't tell by looking at the bottle whether the product works, so the only way to sell the product is through a convincing demonstration. Androff's strategy was simple: "I knew cat urine was an obnoxious odor that most people recognize. We spray a small amount of liquid with a cat-urine-like odor in a [paper] cup. People can smell how bad it is. Then we spray some Atmosklear, and the odor is gone. People smell nothing at all."
Prior to doing demonstrations at trade shows and receiving media publicity, sales had been slow. Says Hilsen, "We tried ads a few times, but each ad generated very few sales."
2. Find where you can make a difference. Of course, a demonstration won't help if people don't want to see it. So Androff and Hilsen chose prospects for whom they knew odor was a persistent problem. Androff describes their early sales: "I started calling hotels, because Bruce knew from previous experience that they were always trying to get rid of smoke odor. I'd call to set up an appointment, and Bruce would give a demonstration. Then I would call back and get the order."
Hilsen feels it has been important for Atmosklear to target the right markets. "Our product can be used everywhere, but we are too small to sell everywhere," he says. "So we try to concentrate on markets where we know people need us and the sales are easiest to make." Other key markets targeted were car, boat and RV dealerships.
3. Use low-cost promotion tactics. Androff used the media to generate early product exposure. (In fact, articles about Atmosklear have appeared in more than 120 magazines and newspapers.) His strategy, though, was more complex than sending the same release to every magazine. "I started by deciding on a market," he says. "Then I found out what odors were particularly troublesome. In the car industry, for example, it was mildew and smoke odors. Once I knew the odor problems, I figured out a protocol, or how the product should be used. Only then would I send the release to the magazine, and I followed up every release with a phone call to the editor."
Androff used a Bacon's Directory, a media directory from Bacon's Information Inc., to find magazines for his targeted industry. Bacon's has the best information about magazine and submission policies, but the resource is typically found only at large libraries. The directories can be ordered online here, but the cost is several hundred dollars each. You can also use the Standard Periodical Directory (Oxbridge Communications) and the Gale Directory of Publications and Broadcast Media (Gale)--available at libraries--to find magazines focused on your target industry.
4. Add a personal touch. Androff and Hilsen answer most of the calls that come in to the company. According to Androff, "We depend heavily on personal referrals. To get that, we have to be sure that everyone who uses the product succeeds. We explain what the product is like, how to use it, and [we] tell people to call us if they have any problems."
That kind of customer care is also what has helped them land bigger deals, says Hilsen. "When a cruise ship or a hotel chain calls, they get to talk to Scott or me," he says. "We find out exactly what they want and give it to them. We are able to [convert] a high percentage of calls to orders because we don't rely on telemarketers. We know the product and how to explain why it is better."
5. Leverage your breaks. Androff and Hilsen haven't concentrated on retailers, because it's difficult for a one-product company to break into a retailer when the product category is crowded. However, they do use press releases to penetrate some retailers in a market. Androff details how the strategy worked after a recent release in Charlotte, North Carolina: "Once we knew [an article was coming] out, we called hardware stores in Charlotte, [told them] about the article and asked them to stock the product. Then, when we ship the product to people, we mail out postcards telling them what local retailers now carry the product. That's been our most effective tactic for establishing retail distribution on limited marketing dollars."
1. Customers with needs keep looking. After trying dozens of different air fresheners, why are potential customers still willing to try yet another new product? It's because they haven't been able to find a product that works for them and because they have a need that won't go away. Customers won't keep looking if they are happy with the products they're using or if the problem just isn't that important to them. But a smelly room in the house is a problem that won't go away--and people will keep trying products until they find one that really works.
2. Allow your business to evolve. When you're up against heavy competition, you can't just force your way into the market, especially if you are under-financed. Instead, keep plugging away, and take advantage of opportunities as they present themselves. Otherwise, you'll spend a whole lot of money before you figure out how to sell your product. Inventors who are too anxious for success are usually disappointed.
3. Sell products over the Internet. Plenty of Internet retailers have collapsed, but that doesn't mean the Internet won't work for you. The secret to Internet sales is to have customers who are looking for you. A product with strong publicity and good word-of-mouth sales will often do well online. The Internet also works when customers have to find a solution to a problem. Androff's contact with GM started when a dealer had vehicles with a mildew odor due to leaking water seals. The dealer's service person tried everything to solve the problem, including all kinds of products he found on the Internet.
4. Let customers try your product. When people aren't sure whether a product will work, they like to try it out. They aren't comfortable buying a product in a bottle if they can't be sure it works. Publicity works because you are getting an endorsement that a product works from an impartial party. Demonstrations work because they offer prospects firsthand experience with the product. But with many products, you also need to be prepared to send out free samples so people can test the product. Otherwise, they just won't be convinced it will work.