Monetizing Innovation
Today’s reading pick:
Monetizing Innovation
Consultants Georg Tacke and Madhavan Ramanujam offer a zero -nonsense path for successful product design. Most companies go directly from scratch towards product design. They usually don’t know whether customers want and will pay for the product until launch is done. The authors describe “nine rules” for products and services designed to meet client demands and “willingness-to-pay.”
Key Take Aways of this Book
Don’t start designing a new product or service until after you learn what your customers want, what they are willing to pay for and how much they’ll pay.
Designing blindly often results in lost opportunities and unwanted products.
Investigate your customers’ “Willingness-to-Pay” (WTP).
Segment customers. Bundle features and tools to appeal to their varying needs and WTP.
Carefully determine your “monetization strategy,” whether “subscription, dynamic, freemium” or another option.
Let your goals determine your pricing strategy. For example, will you target early adopters, prioritize maximizing profits or focus on increasing your market share?
Packing more feature into your core product may seem easy, but resist giving things away for free that a segment of your customers will pay extra to have.
Develop a business case that feels dynamic from the customer’s perspective.
Communicate customer benefits concisely and compellingly.
Avoid lowering your price at the first sign of trouble.
Enjoy reading and improving!
