With the heightened awareness of how topical products are beneficial, many would-be entrepreneurs are contemplating / planning /wising to get a foothold in the market. But, how do you get started?
We have about 50-60 people per year visit our MONAS’ offices or communicate through our web site from all walks of life. Many have great ideas about a skincare line. Many have a potentially proprietary ingredient or fragrance. Some have an already built-in distribution venue and want to plug in skincare (or suncare or anti-aging or other specialty products). Some have made their own products.
Trying to decide what to build, where to sell it and for how much is tricky business but crucial to the potential success of a new line.
Although I have been in this business for almost 40 years and have launched dozens of products, I never had a business course in college. I have, however, learned a lot over the last four decades. The devil is in the details but the following may help you get started.
Here are my three guiding principles:
Perceived value: this is important when you are trying to determine what market your product will best serve. A unique formula with powerful raw materials (often expensive) will be worth more than a run of the mill product. And, packaging and collateral materials are important to the perceived value. The formula should go hand-in-hand with the componentry. For example, a low-cost formula will probably not have long ter4m success packaged in luxury componentry that drives the price up. In contrast, a superior formula packaged in a pedestrian bottle may have trouble commanding the price point necessary to make the project work. A combination of a highly effective formula in great packaging is usually the best bet. Working merely on price point is a tougher road since many companies stress low-cost options.
Point of difference(s) in a product: What makes your product unique and superior to others on the market? It may be a special ingredient or blend of raw materials not used or at least not emphasized in other products. It may be a unique fragrance? Maybe it is the packaging that sets your line apart. Whatever it is, should be a) true, b) able to be presented clearly and in a short presentation, c) be a powerful marketing tool
What the market will bear: Another determining factor to pricing your product and to potential distribution venues is what the market will bear. For example, a highly effective anti-aging product that retails successfully in high end or boutiques for $75.00 sets the market price. There are a lot of factors including the history and reputation and desirability of the product. But, it is a guideline. If your research shows that the market will bear a $75.00 anti-aging product, then you should not attempt to get $130.00 for your yet to be known products. If your market is mid-tier venues, then it would be difficult to get $20.00 for a shampoo with many competitors at $12.00 or less.
These are just some things to keep in mind and maybe present a guideline for your product. At MONAS, we specialize in helping our customers with the entire project, not just product formulation.