What is an idea? An idea is the thought or intention to do something. There are many different kinds of ideas and they can pop into one’s head at any given moment. An idea needs an impulse to give it an impetus. For example, when walking your dog in the park, you see someone eating a pastry on the bench, and you have an idea to eat a hot dog there in the evening.
When does an idea become a business idea? And what is this thing called ‘business’? Business is an economic activity that generates income. But at what point do the business and the idea come together? In fact, every business is still based on an idea. A business idea should be financially profitable, i.e. there will be a paying customer for your product or service. The hallmark of a good business idea is that it will solve someone’s problem. The larger the target group affected by a problem you are solving, the better your business idea is.
Although products and services are very different, they can be classified according to their similarities. In order to better analyse your business idea, we offer you four analogues. These include painkillers, vitamins, toilet paper, and entertainment.
Painkillers are products that solve a very important problem for the customer. Explaining the value and the problem to the customer is not time-consuming, because the customer is very familiar with it and is able to understand quickly. For example, if you have a headache, you take the tablet and feel the benefits within half an hour.
Alternatively, the product may be like a vitamin, being beneficial, but not essential. On the one hand, people understand the need for the product, but, on the other hand, it is not as much of a priority for them. With such a product, more emphasis needs to be placed on marketing and persuading the customer to make a purchase decision.
The third type of business idea is toilet paper. Toilet paper is an indispensable product for everyone, and customers always expect uniform and reliable quality. It is difficult for a company to differentiate itself from its competitors, because the main deciding factor is the price – the cheaper and more efficient the production, the greater the competitive advantage. Once the customer has used the product, they are indifferent to what is being flushed down the toilet.
Lastly, your product can be entertainment. In this case, it is not appropriate to talk about solving a problem; rather, the goal is to create as many emotions and positive experiences as possible for the client. People are willing to spend a lot of money on emotions and entertainment. For you as an entrepreneur, this means that you are constantly having to offer new hit products or services so that people do not lose interest. Typically, businesses based on entertainment products are the first to notice changes in customers’ behavioural patterns during difficult periods of time.
We need all types of business ideas, and the more value you can offer to the customer, the higher and more successfully your business can fly.