What's the Big Idea?
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Bring Your Invention to Life
Caroline Shengle, 46, and Lisa Beltezore, 34, are an inventor's version of the Cinderella story. Beltezore was sick of having her shoes chewed up and her couch pillows carried into the backyard by her beloved canine companions. She and Shengle came up with a solution: They freeze dog treats into a block of ice anchored onto a rimmed metal plate. As the ice melts, it creates a container of cool water for outdoor pets, as well as a toy to keep them occupied.
One patent search ($5,000) and a few prototypes later, the Kool Dogz Ice Treat Maker was a reality, launched out of the women's Thornton, Colorado, home. While making the rounds at their second trade show, they met representatives from Premier Pet Products, a Midlothian, Virginia, pet product distributor, who licensed the rights to the product.
Within a year of the idea's conception, Kool Dogz had a manufacturer and distributor. A few months later, it was being sold online and in small boutiques. Recently, Ã¼ber-pet supply store PetSmart has shown interest in the product, and the inventors are now working on new versions of Kool Dogz and other ideas for pet products.
Of course, it doesn't always happen so quickly or easily.
"It can be expensive to bring the product to market yourself, and it's difficult to get someone else to license it," says George T. Haley, director of the Center for International Industry Competitiveness at the University of New Haven in West Haven, Connecticut. "Buyers have limited time and space, and every year, there's something in the order of 1,200 new products going into supermarkets alone. There are so many different products, it's tremendously difficult to get [buyers'] attention."
Difficult, yes--but nowhere near impossible, especially if you do your homework. In-the-trenches inventors and industry experts recommend these seven essential steps to successfully move from idea to invention.
Doing your homework is the first step in determining if the time, effort and expense of developing your idea will be worthwhile. And that starts with paying attention to the marketplace, says Don Debelak, consultant and author of Bringing Your Product to Market: Fast-Track Approaches to Cashing In on Your Great Idea. The number-one question you have to ask, he says, is whether this is something that people really want--whether there's a need for it in the market.
When collecting this initial feedback, Debelak counsels inventors to come up with some alternative ideas to show prospective customers. Then let them select the product they like best without telling them which one is your big idea.
"The initial test is if you show the idea and a few others to your target customers, and they look at your idea and say, 'Wow, that is a great idea'--you can tell by the look in their eyes whether you're onto something," he advises.
Debelak also suggests looking at the marketplace to see if there's a lot of competition from similar products and to assess whether the product is reasonably within your grasp to produce. While most inventors get some outside help, you should have a good understanding of how your product will be produced and how it will work. For example, if you're a great cook with an idea for a new kitchen utensil, you should have a reasonably clear grasp of the mechanics behind your product.
Another good place to get ideas and contacts for prototypes, production and marketing is an inventor's club. Debelak says inventor's clubs, which exist nationwide, can be excellent places to get information about the best way to bring your invention to life. Trade associations and publications are also great resources for accessing secondary research about your industry and identifying its key players.
Before you share the idea too widely, though, it's a good idea to take steps to protect it, says Patrick H. Higgins, a Princeton, New Jersey, intellectual property attorney with law firm Buchanan Ingersoll & Rooney PC.
But Higgins also sees some budding inventors go overboard. "I've dealt with a lot of folks who were starting a new business, maybe making a new flashlight or a new teddy bear, [and] focusing more on the patent protection than on building the business," he says. "Your first consideration should be how you need to allocate your resources."
Higgins advises looking at the financial resources you have to bring your product to market and understanding how much of that money you can devote to protecting your idea. The most inexpensive way to safeguard your concept against theft is to keep an inventor's notebook, he says. If you can document that you had the idea first, you may be entitled to the patent, even if someone else has the same idea and is the first to file it with the U.S. Patent and Trademark Office within the following year."In the U.S., we have a first-to-invent practice. If you keep a notebook and sign and witness those pages, and properly keep the dates on the pages, that can be very important evidence later on that you conceived of the invention before someone else did," Higgins says. "If two entities file a patent application within a year of each other, and you can go back and look at the records, that would be the controlling evidence as to who was first to conceive the invention."
Before you spend big bucks developing your invention, hire a patent attorney to conduct a patent search and determine if any ideas are strikingly similar to yours. When you're looking for a good candidate, Higgins recommends seeking someone with experience in your area of business.
Once you've determined that no one else holds the patent to your idea, you can work with your attorney to file your patent, which can cost anywhere from a few thousand to tens of thousands of dollars, depending on how involved your attorney gets in helping you develop a strategic plan for protecting your patent. Remember, though, that if someone else had the idea within the year before you filed, even a patent that looks like a done deal can be invalid.
"A good patent lawyer will take an invention and make it into a story, which is easier to sell to the patent examiner," says Higgins. "Your lawyer should be able to take the patent and understand the industry enough to talk about the problems that it solves in an eloquent manner, so the examiner says 'That's smart.'"
If your patent search unearths an invention similar to yours, don't despair. Some savvy entrepreneurs simply acquire existing patents. David Duley, 31, had an idea for an escape ladder that could be easily stowed beneath upstairs windows. A patent search revealed a similar device had been registered. Duley negotiated to buy the patent from the patent holder for an undisclosed amount.
"Roughly 85 percent to 90 percent of patents are never developed," Duley says. "There's a huge wealth of intellectual property, and sometimes it's quicker to just buy the patent than to wait the two- or three-year window that it takes to get a patent approved." Duley suggests that entrepreneurs go to www.uspto.gov to see what patents are already out there.
When Michael Willner, 50, thought about how he could be more productive on a PDA, he realized those tiny keys weren't going to cut it. He came up with an idea for a handheld keyboard shaped like a game controller called the AlphaGrip. It was infinitely more portable than a full-size keyboard and would allow people to type up to 70 words per minute from virtually anywhere.
After a few promising leads, Willner and his partner, Scott Arnel, 49, found that initial interest in licensing the product had evaporated. It took 30 to 60 hours of practice to become proficient on the newfangled input device, and tech companies were nervous that the learning curve would scare off customers. So Willner and Arnel decided to bring the product to market themselves.
Debelak points to three paths inventors can take to bring their products to market. Licensing your product, as Shengle and Beltezore did, means you give another company the right to produce the product for you, paying you royalties on what they sell. Another option, he says, is to become an outsource entrepreneur, where you handle the R&D of the product but outsource the manufacturing and marketing to investing partners, who then have some control over the idea and receive a larger share of profits. Or you can manage the entire process, starting your own company to do so, as Willner and Arnel did when they founded AlphaGrip Inc. So far, they've invested about 10 years and $700,000 in the product.
One way or another, you're going to eventually have to show people what you're so excited about. Sometimes diagrams and sketches will do the trick, but more often, you're going to need to invest in making a prototype.
A prototype is a sample used to demonstrate the product, as well as impress investors and determine manufacturing specifications. Shengle and Beltezore put a lot of thought into the Kool Dogz prototype--even such a seemingly simple product had myriad details to be considered.
"The plate had to be deep enough to hold water and be big enough for the dogs to drink out of," Shengle says. "It had to be made of stainless [steel], because if it was plastic, dogs might chew it. Even the piece where it is anchored had to be just right." Some industrial design firms and small manufacturers can create prototypes. You may find leads from your patent attorney or from your local inventor's club. Higgins recommends having prospective prototype-makers sign nondisclosure agreements. That gives you a layer of protection against them stealing your idea or sharing it with a competitor.
If you're licensing your idea, production probably won't be much of an issue for you, since your licensee will handle the actual making of the product. However, if you're handling production yourself, you need to make sure to find good partners.
Susan Dunk, 36, went through this process when she decided to outsource the production of her invention, the ToddlerCoddler, a specially designed cushion that keeps toddlers' heads from slumping in their car seats. Initially developed for her own kids, a friend prodded her to develop the product for market. She and her husband left their first trade show in 2003 with orders for 119 units.
"My mother and I sewed," she recalls. "My father, father-in-law and husband stuffed them. My 3-year-old put the labels on. My son knew how to run a tape gun at 4 years old."
They were long days, but manageable. However, when independent retailers started showing interest, she realized she needed help and began looking for a manufacturer to take over production. Her company has now developed several different products and had close to $1 million in sales in 2006. If orders come in from retail giants such as Costco and Target, as expected, that number should jump considerably in 2007.
Duley knew he needed help from the start and sent out 35 bid proposals--15 in the U.S. and 20 overseas to facilities he found online in China, India and South America. While he initially wanted to work with a U.S. manufacturer, that proved to be more difficult than he anticipated. "Every single American company either didn't respond or backed out on the due date," Duley says. "Every international company provided quotes in a timely fashion and suggested ideas to make the manufacturing process more efficient." Duley eventually chose a Chinese manufacturer, and he works with Pier Components, a Middleburg, Pennsylvania, firm that acts as a liaison between him and the manufacturer, bridging language gaps and ensuring that production runs smoothly.
Getting the product produced is one thing. Getting it out in the market so consumers can buy it is another.
"Another difficulty inventors face is how they're going to get the product to market," says Haley. "Are you going to use a sales force? That can be hard for a small company because it's expensive to generate a sales force, especially if you're going to be more than a regional or limited national supplier."
One option is to hire a manufacturer's representative. These salespeople for hire have connections with various retail buyers and represent a number of products. The reps are paid a commission only on what they sell, so it's an affordable way for small companies to ramp up their selling power, says Haley. Still, it's not a perfect solution.
"The difficulty with a manufacturer's rep is [that] they only get compensated if they sell something, so they don't want to spend a long time introducing a new product or a complex product and then have to sell the retailer or wholesaler on that product," Haley explains.
Willner and Arnel have successfully brought the AlphaGrip to market, working with an industrial design firm to produce and refine a series of working prototypes, then contracting with a large keyboard manufacturer to create the first commercial run of 1,000 units. They've sold more than 1,000 entirely through their website (www.alphagrip.com) and have completed a second run. The devices retail for $99, plus shipping and handling.
At that rate, it's going to be a while before the device breaks even, let alone makes a profit. But Willner isn't too concerned. "Right now, we're working on refining our niche target markets," he says. "Once we establish these markets and show a track record, we can go back to retailers with a higher likelihood that they'll carry it."
Of course, once the product is finished and in the hands of distributors, the work isn't done. You still need to promote it to your customer, listen to their comments and refine it as needed. But by bringing the product from a sketchy idea birthed in a middle-of-the-night flash of genius to a tangible thing that no one else can create is a considerable achievement.
It's hard not to get overzealous about bringing your great idea to market. But making rookie mistakes can be time-consuming and cost-draining. Our veterans warn against these common blunders.
Falling in love with a shaky idea: Consultant Don Debelak warns entrepreneurs about getting too excited about an idea early on. "If you proceed when there's not a clear market or you can't produce it profitably, you're going to waste time and money," he says.
Doing too much yourself: ToddlerCoddler inventor Susan Dunk was sobbing at the sewing machine on her dining room table when it occurred to her that she needed help meeting her production schedule. "There wasn't enough Advil or sleep for me to continue making each piece, even with the help of my family," she recalls. Dunk worked with an agent to find a reputable and affordable manufacturer in China.
Ignoring marketing and distribution: The "build it and they will come" philosophy doesn't work for new inventions. You need a plan to let the end user know about the product, says George T. Haley of the University of New Haven. "If you have no idea how to communicate it and get it to the market, then it's not going to succeed."
Help is on the Way
Need help with the next steps for your invention? Here are some places to turn.
Ask the Inventors: This helpful website has free resources and advice for inventors, including a downloadable nondisclosure agreement (run this by your attorney, of course), and a list of recommended books on inventing.
Dondebelak.com: Invention consultant Don Debelak offers a wealth of free resources and a detailed guide to bringing your product to market.
Inventor's Clubs: Network with inventors, suppliers, manufacturers and others interested in developing new products. A list of these clubs can be found at www.inventorsdigest.com.
National Inventor Fraud Center: This site, owned by Fargo, North Dakota-based Neustel Law Offices LTD, has good advice on protecting your ideas.
Your Local Small Business Development Center: SBDCs offer free advice, information, counseling and resources to help you start your business.
Take Your Product to Market
Now that you've invented the very best product in the world, it's time to swim out into the sea of distributors and retailers and get your product onto shelves. A challenging process, to be sure, but experts note that with a lot of perseverance and a good helping of entrepreneurial ingenuity, it's possible to get your product into a big-box store, on a home shopping channel and even into luxury retailers. "If you've got a product, you've got three issues," says Jay Abraham, founder of The Abraham Group, a strategic marketing and management consulting firm in Rolling Hills Estates, California. "First, is it something people understand? Second, is it something that immediately projects its [benefit or appeal]? Third, is it really unique? A lot of what you'll do with it depends on what your product is."
Even though you know you've created a great product, you need to spend time researching the types of retailers that will be a good fit. The founders of Belli Cosmetics, Annette Rubin and her husband, Jason Rubin, M.D., quickly realized that typical retail stores weren't the only venue for their line of maternity skin-care products. Inspired by the birth of their first child, Annette, 36, and Jason, 37, had an idea for skin-care products that would be safe for pregnant women. They launched their company in 2000 and started peddling the products to nontraditional locales like spas and the offices of obstetricians and gynecologists. Annette, a former EstÃ©e Lauder executive, evaluated exactly how to find the right match. "How do I deliver an upscale prestige product to market, but broaden its points of distribution and keep it appropriate to those points of distribution?" she asked herself. "Where can I take this line where it'll still make sense for the brand? I can take it into independent maternity boutiques, high-end pharmacies, OB/GYN [offices], department stores, spas and even gift boutiques."
Marketing your product through a targeted niche can save you a ton of money. Instead of spending your precious resources marketing your product on too large a scale--say, to magazines or newspapers that serve everyone--it's more effective to pick out targeted groups that are more likely to need your product. "Go to websites, groups, more favorably disposed retail organizations--any selling channel that would be insanely receptive to your product," says Abraham. "Give them an advantageous deal in exchange for letting you aggressively promote it to their group."
That type of savvy targeting served Issaquah, Washington-based Belli Cosmetics well. Not only can you find their products in those doctors' offices and maternity boutiques frequented by moms-to-be, but also in certain flagship Nordstrom stores as well as at Whole Foods and Drugstore.com, shooting projected year-end sales to more than $2 million.
If your ambitions lean more toward the big-box retailers like Target or Costco, you're going to need a solid plan, an iron will and probably some connections to make your new product stand out over the tons of pitches big retailers get every day. The founders of CanopyChair.com in Columbia, Maryland, enlisted the help of a third-party group to get their product--a folding lawn chair with a canopy that doubles as the chair's storage bag--into stores like Dick's Sporting Goods, Target and Winn-Dixie. "Getting into retailers is a major challenge when you have no contacts and you're starting from the ground floor," says co-founder Sean O'Brien, 27. "We used a third-party [sales rep] who constantly worked with one of our employees to beat down their doors and get [the chair] on their shelves." Launching their company in 2004, O'Brien and co-founders Steve Tinto, 40, Paul Robinett, 40, and Dave Reeb, 41, made the connection with the sales rep at a trade show, which eventually led to Target doing a test run of the Canopy Chair in early 2006.
A small test run is likely the only way a large retailer is going to give your product a shot, says Abraham, so build that into your strategy from the beginning. For instance, outline why your product is a good fit for their stores and customer base, show that you understand their needs and suggest a trial run in five to 10 of their representative facilities--large, small, rural, urban, etc. "That's what they're going to do anyway," says Abraham, "but if you show the enlightenment and the foresight of preemptively [suggesting] that, you'll normally get their respect."
Retailers also like to see metrics and hard data before taking a bet on a new product, so you might consider pitching to smaller, local independent retailers first and securing some solid sales data. Then, armed with those statistics and store success stories, you can make your product even more attractive to larger retailers, says Abraham.
Getting sales reps to help introduce your product to retailers can be a challenge, so try to negotiate deals that are mutually beneficial. "You might approach [a sales rep] to sell your product in exchange for equity in the product or maybe even the company," says Abraham. "Their motivation and focus will have more to do with your success."
Securing strategic partnerships proved to be one of the biggest boosts for the Canopy Chair inventors. "If you don't have the contacts, be ready to partner with someone who [does]," says O'Brien. "Partner with people who have complementary skill sets and [look for] a win-win situation. If both parties can do well, then that's the best route for everyone." The strategy proved profitable--CanopyChair.com has 2007 sales projections of more than $10 million.
Spread the Word
Get adept at convincing others how great your product is because that trait will help you get your foot in the door of nearly every retailer imaginable. "It goes beyond just convincing [a buyer] that your product can sell and be profitable," says George T. Haley, director of the Center for International Industry Competitiveness and a marketing professor at the University of New Haven School of Business in West Haven, Connecticut. "You have to give them something that indicates that they have a real winner on hand--that your product might differentiate them and be truly beneficial."
Highlighting the unique aspects of her company, For Goodness Cakes, Jodi Braun, 51, pitched retailers with the hook that her gourmet cakes are a cross between cheesecakes and coffeecakes in both taste and texture. This Apple Valley, Minnesota, entrepreneur entered a contest for new vendors on QVC and presented her cakes in a room with thousands of other vendors, but she caught the judge's attention with her pitch. "The judge told me, 'Had you said it was a cheesecake, I would've never talked to you, but because you said it was a cross between a cheesecake and a coffeecake, I'm interested in your story.'" At press time, Braun's deal with QVC was still in progress.
Braun's pitch was one element of For Goodness Cakes' success; the other was capitalizing on the viral word-of-mouth buzz her cakes created. After creating 12 cake varieties, including White Chocolate CrÃ¨me and Fudge Marble Swirl, based on her mother's recipe, she launched her company in 2002. She networked with everyone she knew--even the health-conscious patrons of her local gym loved the decadent treat. Says Braun, "People would say to me, 'I'm working out to eat your cake.'"
Braun made the most of every connection and, as with many viral marketing programs, one connection led to another. A friend who she'd met at one of her cake demonstrations had a connection at Target, which led to Braun's cakes launching in the gourmet shop at Target.com. Also available in Midwest grocery chain Lunds & Byerly's, For Goodness Cakes should hit $1 million in revenue for 2007.
TV Star Power
Braun's not the only one making inroads at QVC. The TV shopping destination proved enormously successful for Peter Janssen when he launched Thumbs Up! Hanger. This Middleton, Wisconsin, area veterinarian got the inspiration for his product while hanging pictures in his office. He thought there should be an easy, reliable way to hang pictures on the wall without using tools. The result was his design for a metal hanger with a sharp edge to pierce through drywall and a hook edge to hang the picture. With a push of the thumb and a twist into place, the picture is up. Because the product was easily demonstrable, it was a great fit for the QVC format. An old friend proved to be a true six-degrees-of-separation contact for Janssen--his friend knew someone who worked with QVC and helped him introduce the product to the retail giant. "QVC is an unbelievable place," says Janssen, 48. "I had no idea how powerful it was."
Once the deal was set, Janssen flew to QVC's studio in Westchester, Pennsylvania, for an all-day "guest expert" training course to prepare him for his on-air debut in March 2006. During his first QVC appearance, he sold 2,000 of his 20-pack picture hanger units, generating $4,900 per minute in sales. "We sold out 2,000 units in six minutes," recalls Janssen. "All I'm doing is showing people how this thing works, and the phones are just going crazy. It went really fast, and it was really exciting." Since then, Janssen has appeared on the channel five times. For more vendor information on the home shopping arena, including FAQs and application criteria, check out QVC and HSN.
Janssen found that it takes time to get even a truly unique and easily demonstrable product out into the world. Never quitting his day job, he worked on his design and patent steadily for years before officially launching his company in 2005. He researched the market and overseas manufacturing business extensively during the startup process. "If you feel you have a good product, persistence is probably the most important thing you can have," says Janssen. "There were a lot of twists and turns, and [sometimes] I thought, 'I should just let this go.' But I didn't. Being persistent about taking the next step essentially got me where I am. Just keep at it." Today, he would like to maintain the relationships he has with QVC as well as local ACE Hardware and TrueValue stores. He also hopes these brick-and-mortar retailers will help him sell his product at the national level in the future. Janssen expects sales of up to $400,000 this year.
Tenacity like Janssen described worked well for husband-and-wife entrepreneurs Noah Houghton and Katrina Merrem, founders of Noka Chocolate, a high-end chocolatier in Dallas. With a vision to market the purest form of cacao to chocolate connoisseurs, Houghton, 30, and Merrem, 34, did tons of research on everything from chocolate manufacturing to high-end box-makers for their ultra-chic packaging before they launched their enterprise in 2004.
They also researched high-end retailers and believed Neiman Marcus would be a perfect match for their chocolate brand. Houghton contacted the Neiman Marcus buyers repeatedly, first to introduce the company, then to send product samples and follow up. "It was an attentive persistence," says Houghton.
One day, Merrem actually went to the Neiman Marcus offices downtown, located above the flagship retail store. She asked a security guard for directions on where to drop off her product samples, but ended up getting lost in the offices. She accidentally found herself right in the buying office--a place vendors generally aren't supposed to be. Instead of turning back, Merrem politely handed them the samples. Says Houghton, "She thought, 'Hey, I'm here, let me take the opportunity.'" Her boldness won the day--now Neiman Marcus is the high-end retailer for the Noka brand.
A foundation of solid research certainly helped launch Noka Chocolates, and now Houghton and Merrem even have a few Noka flagship stores of their own in Dallas and Tokyo. They also have plans to expand to the Middle East and further into Asia, pushing 2007 annual sales to $1 million.
The bottom line in your epic product launch is to do your homework. Seek out books on distribution channels and read retail industry trade publications to make yourself an expert. "The more honestly you can see your product, the better off you're going to be," says Haley. "But the greater your commitment, the greater your absolute faith in that product, the more successful you'll be, too."
Jodi Braun had everything set. A big-box retailer had made a significant order from her line of For Goodness Cakes. Just 48 hours before delivery, when every cake was baked, packaged and ready to go, Braun got the devastating news (via e-mail) that the order was cancelled. "I was really upset," says Braun.
What might be a small setback for more established companies could be a fatal blow to a new business. First, you need to check your contract closely to see if the action is within the retailer's rights. If it is, you've got to gear up to get that product out quickly, says George T. Haley, professor of marketing at the University of New Haven School of Business. "In negotiating the contract, insist on some degree of compensation if [a cancellation] happens," he says. "Putting it into the contract means it's less likely you'll get the sale, but it's a trade-off you have to consider."
Braun let herself be upset for one day before gearing up to weather the storm. Her backup plan included donating some of the inventory to nonprofit shelters and thankfully, she was able to store the rest in freezers. The plan proved financially viable and helped to restore Braun's spirits. Turning the negative into a positive, Braun says, "I use [the experience] as fuel. It gives me so much motivation and energy to move on."
Welcome to the Infomercial Age
Selling directly to a consumer via an infomercial can be a great way to launch your product. "[If] entrepreneurs can show their product is successful on TV and the consumer wants it, that makes it easier for them to get that product into retail," says Peter Koeppel, founder of Koeppel Direct, a direct-response and media buying company in Dallas.
Products that often do well in the direct-response/infomercial space are ones with the broadest appeal, such as household products and kitchen products. "If it's too niche or too expensive, it probably won't sell as well on TV," Koeppel says. He advises entrepreneurs with new products to seek out companies with solid experience in direct marketing, especially with products in your arena.
You'll likely spend about $10,000 to $15,000 on a media test, and a two-minute short-form infomercial can run you about $25,000 to $50,000. A full-length 30-minute one can run more than $100,000. The great thing about this format is that it generally provides specific data about which consumers are buying your products. If you decide to go this route, remember that your website is key, too--many people who see your infomercial will go straight to the website to order instead of picking up the phone, says Koeppel. "The internet is an important part and works synergistically with the TV to improve the performance of the campaign."
Just Don't Do It!
Experts Jay Abraham of The Abraham Group and George T. Haley of the University of New Haven School of Business reveal five common mistakes to avoid during your product launch.
1. DON'T spend a fortune on media that doesn't target your product's specific audience. If a publication has a circulation of 10 million and you only get 2 percent to respond, you probably figure you'll make a fortune, but "it's much harder than you think," says Abraham.
2. DON'T assume that just because you think your product is fantastic, everyone will automatically agree. You must objectively evaluate the merits and shortcomings of your product.
3. DON'T under-research your market, including who your competitors are and why retailers might want to stick with them, says Haley. You have to figure this out before you can come up with a solid plan on how to overcome their objections.
4. DON'T overlook the skepticism of most buyers, says Abraham. "The buyer is inherently suspicious," he says. "He or she has an infinite number of options in the product or service category you're offering." Understanding that can help you market yourself in a way that highlights your product's assets while making it stand out from the crowd.
5. DON'T be shortsighted about the risks involved for a retailer taking on a new product. Says Abraham, "Understand what the level of psychological, real and perceived risks are in a transaction. If you can eliminate or reduce them entirely, it's easier for someone to say yes to you."