by: Geoff Ficke

Successful business owners tend to approach fanaticism in nurturing every aspect of their enterprise. They work longer hours than their employees, take the work home with them, sacrifice leisure and relaxation as they obsess over their competitors and continually seek new systems and innovation to expand their shop. They are rewarded by receiving the respect of their peers, providing a comfortable lifestyle for their families and their employee’s families and participating in the social fabric of the community in which they operate.

The erudite Spanish critic and philosopher George Santayana once wrote, "Fanaticism consists in redoubling your effort when you have forgotten your aim".

When things go cockeye in any enterprise, the only opportunity the group will have to right their ship is to look at history and recalibrate. What made them successful? What did their customers reward with support? Where did they fall off the rails?

History is resplendent in examples of organizations that lost their way. Those that "forgot their aim" either redoubled their efforts at getting back to their original success path or were consumed by their mistakes. Empires such as the Hohenzollerns, Romanov, Bourbons and Hapsburgs expired as times changed and they didn’t. The Royal houses of Great Britain, Holland, Sweden and Denmark, however, recalibrated in the face of modern democracy and adjusted to the times and still enjoy their thrones and a large measure of popularity with their subjects.

In World War II the Russian army was initially invaded, pummeled, mauled and demoralized by the German invaders. However, the Red Army adjusted, replaced their general officer corps; devised new strategies and weapons systems that were purpose built to fight the Nazi menace. After a grueling series of embarrassing defeats the Soviets finally were able to absorb the Nazi push at Moscow and slowly turned the tide. Changing strategies lead to the Russians seizing Berlin at the end of the war and complete vanquishing of Hitler’s forces.

Contrast this result with the inflexible strategy executed by the Imperial Russian army in World War I. The Russians simply sent waves of under-equipped, starving, freezing peasant soldiers in waves to be slaughtered by well dug in, well armed, well-provisioned German divisions. The disgust that these soldiers felt at being used as cannon fodder lead directly to mass mutiny and the opportunity for Communists to seize the government and control of the army. After pulling back and virtually surrendering to the Germans, the newly entrenched Bolshevik government seized the Romanov family and murdered them.

There are many examples of religious movements, charities and businesses that did not adapt to changing times user tastes or styles. Islam has lasted for centuries while Zoroastroism and Coptic Christianity have virtually become extinct in the Middle East. Animism is on the decline in Africa even as Roman Catholicism and Evangelical Christianity groups convert large numbers of people across Africa.

The Salvation Army and Catholic charities enjoy sustained growth while the United Appeal and Red Cross, while still important, have been hurt by scandal.

The most starkly obvious examples of groups losing their way can be found in the business world. Look at listed stock equities that made up the Dow Jones Industrial Average in the 1930’s. Only Standard Oil (Exxon), Procter & Gamble, Dupont and United Technologies (United Aircraft) remain from the original list of blue chip companies that defined American industrial might. How did so many formerly stellar performers fall by the commercial way side.

The most stunning fall, and most relevant to contemporary observers is General Motors. Former GM Chairman Charlie Wilson once famously said, "What is good for General Motors is good for the United States". GM was synonymous with American industrial might and was a symbol of American strength, creativity and the good life.

GM was assembled in the 1920’s and 1930’s by the management innovator Alfred Sloan. By taking Chevrolet, Pontiac, Buick, Oldsmobile and Cadillac and creating stair step marketing Mr. Sloan targeted an automotive nameplate at every demographic group. Young families started with Chevrolet and as their economic situation improved they moved up the ladder of brands to Buick and later Cadillac.

The loyalty this strategy created was reinforced by constant fresh styling cues.

GM design was personified by the brilliant craftsmanship and coach design of Harley Earl. Mr. Earl had a signature style that came to scream GM, cutting edge, beauty and created consumer desire for being seen driving GM cars.

As late as the 1970’s over half of all vehicles sold in America were produced by GM. Then a series of events occurred which caught the behemoth corporation flat footed, bloated and unable, unwilling and without the guile necessary to change direction and adapt to changing market realities. A long, slow, inevitable decline has resulted in the implosion of GM, bankruptcy and shedding important component divisions that will forever hamper the company’s ability to compete with more nimble competitors.

GM has failed. It is the butt of late night comedian’s jokes. Sales have cratered and Government Motors is out of most consumers mind when considering a new vehicle purchase. The demise of GM has occurred even as agile competitors from Europe, Japan, Korea and China see their growth accelerating. The necessary value retention, durability, warranty, performance, fuel economy and styling that GM did not address has been committed too with gusto by the competition.

Brands like Toyota, Hyundai, Fiat, Honda, BMW, and Chery have recognized what consumers want and provide these features and benefits at prices that GM could not match. GM did not redouble efforts to provide consumers with true value in exciting packages. The competitors have.

GM is now trying to reinvent the corporation. All Americans hope they can. However, the deck is as stacked against GM as it was against Studebaker, Hudson, Crosley, Nash, Stutz, Pierce Arrow, Dusenberg and Hupmobile.

GM, like so many other enterprises, lost their aim. They did not redouble their efforts to please their formerly loyal consumers until far too late in the game. This is a crippling malady that is most difficult to overcome. The fanaticism of Harley Earl, Alfred Sloan, Charley Wilson and Zora Arkus-Duntoff (creator of the Corvette) has been missing for too long. The Cadillac Cimarron is a symbol of a legacy short on passion and fanaticism and long on lethargy and mismanagement.

Every entrepreneur can take an important lesson from the horrific demise of this fallen American industrial icon. Passion can never lessen. Stay focused while being astute in keeping abreast of changing consumer tastes is essential. As tastes change, you must adjust. The fanaticism you bring to your enterprise will enable you to succeed initially, but redoubling efforts is key to maintaining growth and long term viability.

Dallas, TX John Steger, President of The Kaston Group, specialists in retail display and point of purchase engineering, today announced that his Company has been engaged to produce custom designed counter display units for the launch of MakeUpMiser®.

"Nancy and Geoff Ficke from Duquesa Marketing presented the MakeUpMiser® to us recently in Dallas", said Mr. Steger. "The products have so much utility and there is simply nothing in the marketplace that performs these simple, but essential tasks. We are thrilled to be involved in such a novel project".

"John Steger is widely recognized as a premiere point of sale specialist", said Geoff Ficke, President of Duquesa Marketing. "His experience in total store design, department store fixtures and counter display is vast and we are excited to be working with his team again to present MakeUpMiser® to cosmetic consumers".

"I reviewed a number of potential candidates for our display needs with my marketing consultant Duquesa Marketing", said Michelle Phillips, President of MakeUpMiser®. "I feel fortunate that we have been able to retain professionals like Kaston Group to display MakeUpMiser®.

MakeUpMiser® expects to present the full line of cosmetic accessories to international retailers this fall and be on store counters in spring 2010. Retail pricing will be announced shortly.

Press Release

For Immediate Release

Contact: Geoff Ficke

859-567-1609

Lancaster, PA Michelle Phillips, President of MakeUpMiser®, announced today that her cosmetic product Company has appointed Cincinnati, OH based Diana Puppin of dp Design to design new graphics art for the upcoming launch of her firms cosmetic accessory products.

"We reviewed a number of creative options for our packaging, sales collateral, branding and retail display needs", said Mrs. Phillips. "Diana Puppin was an easy choice based on her immediate grasp of the diverse features and benefits of MakeUpMiser® and her extensive body of work in the cosmetic industry".

"We work extensively in all categories of consumer products", said Diana Puppin. "We really enjoy cosmetics, the whole beauty category. The MakeUpMiser® is an amazing product line that presents interesting creative challenges and we are excited to have the confidence of Michelle Phillips and her team".

MakeUpMiser® previously engaged Duquesa Marketing of Florence, KY to handle all aspects of the product development, marketing and launch of the products. "MakeUpMiser® offers cosmetic product consumers two unique benefits that are not currently addressed in the marketplace, safety and economy", said Geoff Ficke, President of Duquesa Marketing. "We have worked with Diana Puppin in the past and her creativity will be an important piece of the MakeUpMiser® success".

The patent pending MakeUpMiser® three product line of cosmetic accessories will be introduced to retailers in the fall of 2009 and begin shipping internationally in the spring of 2010.

by: Geoff Ficke

My marketing consulting firm looks at hundreds of new product submissions each year. They come from all over the world and they cover the gamut from brilliant to silly.  Some become successful in the consumer product marketplace. Why do so many fail?  And a more pertinent question is, “why do products with excellent qualities fail even though they have so much to recommend them”?

There is no one size fits all answer to the question. However, there are several threads that consistently appear and act as stop signs when ideas cannot be made to penetrate the very competitive marketplace. The following are the most common examples of deal killing actions or strategies undertaken by entrepreneurs that will snuff out opportunity for success. 

·        The Boaster

“I have a mega-million dollar product. Do you want to partner with me”?

In 35 years of designing, developing, marketing, launching and selling all types of consumer products, I have never met a new inventor who could detail with any justification the real size of their opportunity. The Boaster simply scares off potentially interested sources of funding or assistance.

·        The Know It All

“This product will revolutionize the ___ (fill in the product category).

Marconi, Singer, Watt, Edison, Gates, Ford, Napoleon, da Vinci and St. Augustine revolutionized their fields of endeavor. Revolutionary products, we call them “divergent products, are about as rare as pink diamonds the size of baseballs. Divergent products require creating new businesses, typically in areas that consumers have no current need for. Who needed a computer in the home, before it was invented and applications were perfected? Now the home computer is ubiquitous, inexpensive, work and entertainment vehicles, and indispensible for most people. The Know It All has all the answers for a product or service that we do not yet know we need. He has no idea how difficult and expensive it is to pioneer a completely fresh product category and is almost always naïve and unrealistic.

·        The Plodder

The Plodder loves to brag that he has spent five or 10 or 15 years working on his product. That may be so, and can be acceptable. However, most investors, marketers or licensors will view The Plodder as not fully committed. If there is patent protection involved, the product becomes less valuable each day that patent life is being consumed. Successful entrepreneurs are fully committed, never stop pushing and face down and conquer each barrier that they will confront. They are passionate and aggressive. They know that time is not their friend, as competitors, real and imagined, are working just as hard and hoping to beat them to market.

·        The Dreamer

We meet more of The Dreamer than any other deal killer. This fellow is typically a plumber, teacher, accountant, or makes his living in a way that is a complete leap from his idea.  The Dreamer decides that he can invent a perpetual motion machine or has the technology to make cars run on yard clippings. Three questions unfortunately trip up The Dreamer and we have never had to ask a fourth to burst this bubble.

·        Mr. Other People’s Money

This hopeful entrepreneur does not have any money, typically does not have any due diligence, no art, no engineering, but is most keen to ask for someone else to pony up money for his pipedream. Let’s be clear: there are Angel Investors. However, they are very rare, very targeted and there is little chance that they will have interest in any project where the submitter has put no sweat in the game.

·        The Idea Merchant

The Idea Merchant has an idea. He usually has no background in the field he is exploring. He just has an idea. He wants to sell or license his idea. The Idea Merchant will sell his idea, usually for a huge amount of money, and allow the buyer to enjoy the profits that are always sure to come. The Idea merchant is always wasting his time. There are no shortcuts.

·        Mr. It’s Easy

This fellow does not understand, or respect the effort required to successfully launch a new item. There are simply no shortcuts that can be taken that will not kill opportunity. Mr. It’s Easy is looking to foist an idea or an underdeveloped concept on someone else and still capitalize financially on his under-fertilized brilliance.

·        The Time Bandit

The Time Bandit expects to be paid for going to work and putting in his time each day. However, he doesn’t want to pay for services rendered by professionals with needed specific skills required to prepare and develop a product for market launch. Graphic artists, prototype builders, copyrighters, engineers, model makers, packaging designers, consulting, legal and accounting and production experts may be needed on projects development. It is silly to think that accomplished professionals will provide expertise, time and investment in materials for nothing.

·        The Dazed and Confused

Like the old Led Zeppelin song, “The Dazed and Confused” is, well, stumbling along. He starts and stops. He is trying to game the system, and really himself, by confusing movement with progress. His Business Plan is always a work in progress because he really thinks he can suspend reality and a well-crafted plan is not important for his project to be successful. He can impress decision makers, he thinks, with words. Unfortunately for Dazed and Confused, decision makers always see much better than they hear.

·        Even If I Don’t Build It They will Come

We hear from this gentleman a lot. He has an idea for a new machine, engine, tool or piece of equipment. The device actually sometimes sounds interesting and can be envisioned as having some merit. However, Mr. Don’t Build It has not perfected, engineered, built or demonstrated the unit’s features and benefits because he will not build a demo prototype. 

These are just a few of the general personality types that we meet while analyzing new business opportunities. But they are regular visitors. They defy every quality or trait that we see in successful entrepreneurs. Real entrepreneurs will do anything necessary to perfect their product. They do not seek or take shortcuts. They perform every bit of due diligence necessary to satisfy the most demanding buyers, investors, licensees or distributors. They are thorough, prepared and fully engaged. Most of all they are passionate about their work and the opportunity without being dreamy, unrealistic or bombastic.  

Our frustration is that the non-commercial products, silly presentations, lack of professionalism and poorly thought out approaches for new product submissions we review are comingled with many submissions that have real solid potential. Unfortunately, all they have is potential.

 Press Release

For Immediate Release

Contact: Geoff Ficke

859-567-1609

by: Geoff Ficke

I am a Fellow at the Paige Center for Entrepreneurial Studies, Miami University Business School in Oxford, Ohio. Each semester I work with students in a capstone course concentrating on writing business plans. Passage of this course is a requirement for graduation.

The students are typically engaged, bright, concerned for their future, and keen to graduate with the best possible grade point average. At the beginning of each semester, I give them a lecture attempting to assist and guide the students in choosing a business concept, service or product to use as the basis for their teams business plan submission. I always ask the same rhetorical question. They always provide the same wrong answer.

My question is this: Take any product category, let’s choose consumable beverages. Do you want your product to have to compete with Coke, Pepsi, Mountain Dew, 7-Up or Dr. Pepper for shelf space, promotion, end cap display or distribution? The answer I receive, almost always in unison, is no.

The right answer is yes.

The large, seemingly invincible and impregnable, multi-national beverage companies are like all massive enterprises. They are slow, become sclerotic in creativity, management and systems, and are surprisingly susceptible to more energetic, nimble entrepreneurs. We see this same behavior in all mature industries. Automobiles, retail, communications, media, cosmetics, foods, hardware, technology, transportation and clothing are only a few examples of categories constantly churned by failure, improvisation and novelty.

Explaining the beverage industry opportunity for entrepreneurs, in this case my students, is an important example of identifying market niches. Each year new drink products fill unanswered niches as entrepreneurs identify opportunities to address consumer preferences with drinks offering new features and benefits. Arizona Iced Tea, Monster, Red Bull, Vitamin Waters, Gatorade, Snapple and dozens of styles of bottled waters and teas are only a few examples of successfully penetrating a mature, very crowded category.

The Coke’s and Pepsi’s have seen their market shares stagnate in recent years. They have become very acquisitive, purchasing many of these start-ups and adding them to their lineups. It is now widely recognized that it is cheaper to buy innovation than to nurture it internally in most cases.

Chrysler and General Motors were venerable business franchises that enjoyed worldwide success and admiration until recently. They have fallen, far and hard. Lack of vision, management flaccidity, labor union corpulence, a reputation for poor quality and lack of styling and value have doomed their enterprise value. Meanwhile, foreign auto manufacturers from China and Korea have evolved to snatch market share and fill voids vacated by the Chrysler and General Motors. The same type of industry evolution is happening in every product category.

In retail, Steve and Barry’s, Bombay Company, Linens and Things and Circuit City are only a few examples of formerly powerhouse national chains that have disappeared. H&M, Zara, Aeropostiale and Sephora, on the other hand, have crafted new merchandising options that excite consumers and propel their continued growth.

This creative destruction and turnover presents an excellent opportunity for businesses, individual inventors and entrepreneurs with truly novel concepts, services and new products. Do not let the appearance of gigantism disable the instinct to compete with big brand houses. "The bigger the harder they fall", goes the old maxim. It has never been truer.

Identify a niche in a mature industry. Engineer a product or opportunity to fill the identified niche with a better mousetrap, one that provides consumer features and/or benefits that will interest consumers. This is the surest path to commercial success and trumps sheer size in every sales channel.

by: Geoff Ficke

The great British entrepreneur Anita Roddick, founder of the internationally acclaimed Body Shop chain of shops, once said: “Running a company on market research is like driving while looking in the rear view mirror”. Ms. Roddick is symbolic of the successful entrepreneur who builds a business by dint of passion, instinct and total belief that their vision is revolutionary. Business history is replete with examples of such pioneers.

The Body Shop has succeeded for decades because of Anita Roddick’s passionate belief that natural products, crafted with locally grown, native harvested herbs, fauna and flora gave the consumer better performing toiletry products while benefitting the environment. Her Company profited. The native populations, often impoverished, benefitted. The environment has benefitted because the elements harvested are naturally replenished.

Howard Schultz was the visionary behind the growth of Starbucks. Ray Kroc saw immense opportunity in a small California hamburger emporium run by the McDonald brothers. Henry Ford understood the possibility available to an entrepreneur with the ability to harness the forces of scale and mass production. Elizabeth Arden was a pioneer in the high fashion cosmetic industry because she had the eye for color that made her products indispensible to the well groomed woman early in the 20^th century. Coco Chanel created a couture style that exists and is imitated to this day.

All of these business pioneers, and an endless list of others, possessed the one essential germ of entrepreneurial success: The ability to identify an underserved niche and fill it with goods and services that improved lives. They did so without utilizing exotic demographics, customer research or focus groups.

In our consumer product consulting business we have very rarely used focus groups to attempt to confirm assumptions about a product or new business idea.

The reason we find, as did Anita Roddick, the concept to be of limited value is because the variables are simply too great to accurately quantify results. The class chosen to participate, the questions asked, the way questions are asked, the methodology utilized to assemble results, and other elements are all capable of producing wrong or misleading information. The result is usually a commercial disappointment.

Successful entrepreneurs have a far better gauge of prospects for commercial success for a new product: their instinct. No one knows why Francois Coty understood what women wanted in perfume. The reasons that Vernon Stouffer saw opportunity after World War II in frozen meals when others already in the food industry did not are unfathomable. Orville Redenbacher just knew that gourmet popcorn would be popular with consumers. Leslie Wexner built The Limited into the world’s largest woman’s clothing chain based on his belief that designer styles at moderate price would be a simple, but winning formula.

None of these visionaries utilized fancy marketing methods before launching their companies. The creative mind saw an opportunity, looked at the marketplace and identified a niche and leapt into action. 

Every year many new products, services, retail concepts and businesses are launched. Some succeed, many do not. However, the winners almost always possess the key asset of being driven by an entrepreneur with keen instinct, vision and passion to provide beneficial new offerings for consumers. The late Anita Roddick was but one example of such a visionary. Her lasting legacy is that even in death she is a beacon of what is possible for any person to achieve if they simply follow their instincts, work diligently and pursue their goals with unswerving passion.

by: Geoff Ficke

We live in perilous financial times. As the markets have imploded, home prices cratered, jobs lost and incomes uncertain many people have become very risk averse. Very understandable! Many of us are more focused on maintaining our resources than expanding them in the face of so many unknowns.

The American dream to successfully start and grow a self-owned business is always going to be with us. However, in times like these, some entrepreneur’s have become less willing to take the plunge into the ownership class. They are willing to wait until things settle; markets calm and funding sources return to prior levels. This is sound strategy for the timid, but these people are probably never going to be truly successful as business pioneers.

Recently I was in Spain and read a story about some French film students. Like so many creative artists, these young people are passionate about their art and fully committed to their dream of creating full-length films, in this case human rights documentaries. This is a very hard type of project to fund, even in the best of times. The market is brutally competitive, distribution is scarce and profits are very elusive for all but a few of the best productions. How in the world would these students find the funding they so desperately craved?

They did it the old fashioned way: they got creative. They sold vanity to investors. 

Have you ever sat through and paid attention to the credits listed so fully at the end of any movie or television show? They seem to scroll on forever. Each caterer, assistant caterer, food taster, drinks coordinator or executive chef is listed, fully named and titled. Over the past 20 years the number of producers, executive producers, assistant producers, joint venture producers and specialty producers credited has grown exponentially. This gave the students a simple, brilliant idea: We will sell credits for investment.

They started with other students, family, then used the internet. Credits were sold for various levels of financial contribution to the production, some for as few as 10 euro’s. It is amazing what some people will do to see their name in lights. Money poured in and the students were sufficiently financed to complete their film, present it at European film festivals and arrange distribution deals in various European media.

This is but one example of how serious, passionate entrepreneur’s search for alternative paths to bring their passion to markets. The opportunity has never been greater for those willing to get in the game. Is money tight? Of course it is. Has new business startups slowed down? Of course it has. Are people still trying to launch businesses, follow their dreams and present consumers with better products? Of course they are.

When business is booming, venture capital seemingly flowing endlessly and entrepreneur’s crawling out of the woodwork, well guess what, there is relatively speaking, no more opportunity that there is in soft times. In up cycles there is more activity chasing a finite number of resources. In down times, there is significantly less entrepreneurial opportunity chasing a still existing, but somewhat diminished pool of capital. It closely equals out.

The available capital necessary for funding exciting new opportunities is readily accessible if the entrepreneur is creative. The world economy will come out of this problem time. The products and services that are being prepared now will be the big winners when the pent up demand for new consumer products, technology, cosmetics, sporting goods, wellness products and a host of other categories explodes as consumers return to markets. Just remember, if it were easy to be successful everybody would be. 

Venture capital and funding sources are always, especially now, seeking the best, most vibrant, creative opportunities. Make your product special, desirable and different and then, it really doesn’t make any difference what the economy is doing. You will be able to attract the resources needed to be successful.

by: Geoff Ficke

The world worships the game of “futbol”, which in America we call soccer. While soccer has enjoyed phenomenal growth as a popular sport for male and female children, and at the high school and college levels, the game has not succeeded on the professional level in the United States. In the rest of the world, however, soccer is the most rabidly followed of all sports.

“Futbol” has been ordained the “Beautiful Game” by the soccer mad fans addicted to the game. Because the use of hands to control the ball is not allowed, the game requires immense foot/eye co-ordination, speed, balance, aggression and a chess-like strategic vision of the complete field of play. The flow of the game, which can seem slow to casual observers, is part of the beauty of the game which heightens the passion the sport enjoys among its rabid followers.

I have lived in Europe and travelled widely, including second and third world countries. It is an amazing sight to see a country completely mesmerized, the population, men and women, old and young, glued to television screens, as key matches are contested. Games between clubs from different countries create an unbelievable outpouring of nationalism.

Soccer is a beautiful game. And if that claim is true, then I believe baseball is the perfect game. The pace of soccer and baseball are similar in that much of the play is spent in preparation for the difficult tasks of scoring, goals in soccer, runs in baseball. Both are total team games, and yet, both require individuals to perform at high levels. The shortstop in baseball is completely alone when attempting to field a hard hit ball, but he needs other players to perform their roles in order to throw out base runners.

The symmetry of baseball is amazingly perfect. The game has been idealized to have been invented by Abner Doubleday in an upstate New York field in the mid-19^th century. Maybe, maybe not! However, whoever really crafted the rules of the game designed a field of play with perfect dimensions. The dimensions actually increase the drama of virtually every pitch and play.

Imagine if bases were closer, or further, than 90 feet apart. The bang-bang play at first would almost never happen. If bases were closer the stolen base would be automatic, even for slower runners. The bases are laid out in a diamond, which provides a perfect path for runners to pursue and fielders to target. The pitcher’s mound, a small hill, is 60 feet, six inches from the point of home plate. If the rubber on the mound, which the pitcher uses to gain purchase and leverage while throwing to the batter, were closer than 60’, 6” the batter would have almost no chance of ever hitting the ball. If the rubber were further back the hitter would enjoy an unfair advantage.

The strike zone is designed to balance the opportunity for the pitcher and hitter to succeed on a competitive basis. Three strikes and the batter is called out; but an at bat can be extended indefinitely by fouling off pitches. Four balls and the hitter earns a free pass to first base, thereby forcing the pitcher to throw strikes or give up base runners which can lead to runs scored.

The most wonderful thing about the game of baseball is best described by the great Yogi Berra’s famous statement, “it ain’t over ‘til it’s over”! Unlike every other team sport there is no time limit in baseball. The game does not end until the last out of the ninth inning is secured. It is possible, and does happen regularly, that a team can be seemingly so far behind in the run count that the outcome of the game seems inevitable, but a few hits, a few walks, an error and all of a sudden there is hope that the outcome will be reversed.

Spring training, baseball on radio, hot dogs and beer at the park and the opportunity to enjoy a game played at a leisurely pace on a warm summer night while kibitzing with friends all make baseball the “perfect game”. It is every bit as beautiful as soccer, but played well, there is no sport as perfectly crafted and structured as baseball.

by: Geoff Ficke

My marketing consulting/product development firm reviews hundreds of prospective consumer products from every category imaginable, each and every year. Sporting goods, specialty foodstuffs, auto accessories, juvenile products, toys, games, shoes, jewelry, ready to wear and health and wellness products are only a short list of types of items we review for funding and market launch potential. I am often asked what is the space most easily penetrated by entrepreneur’s?

This question invariable pops up almost every time I lecture at a university or am interviewed by media. I used to be a bit arbitrary, almost opaque in answering. However, over the years the answer has come into sharp focus. The beauty product industry must be at the top of any list of entrepreneurial sweet spots for successfully launching and growing a start-up business.

Since Biblical times perfumery has been a highly desired artisan industry. Local flora and fauna have been compounded into scents and potions that add beauty to the human body, the atmosphere and religious worship. Cleopatra was famous for her fragrant baths, the Bible is full of references to sacred fragrant oils and in modern times the fragrance industry has matured into an international, multi-billion dollar business.

And yet, every year, inspired entrepreneurs bring new scents to market. Aromatherapy has boomed as the science and awareness of the mental and wellness benefits of specific aromas has been researched. The process of creating a completely new scent, packaging, branding and delivering the consumer a product that offers a different fragrance perspective has never been easier.

One of the great entrepreneurial commercial success stories in the history of the perfume industry was the story of Giorgio. The eponymous fragrance was born in a single Rodeo Drive boutique, Giorgio’s, in Beverly Hills in the 1980’s. The scent, a clear break with popular fragrances of the time, was overwhelmingly powerful. The distinctive top note made the boutique a destination for shoppers as word of mouth travelled quickly about the unique warmth of the dried down fragrance notes of Giorgio.

The Company did not have the necessary funds to launch nationally with major department stores. The owners decided to do a bit of guerilla marketing. They started to place scent strips impregnated with the Giorgio scent inside of local magazines targeting high end consumers. The power of the scent leached from the magazines and newsstands became fragrance cocoons for the Company. Mail order sales exploded, the campaign was quickly expanded to national women’s fashion magazines and a direct mail business was set up solely to fulfill consumer demand.

Soon the major department stores were falling all over themselves to stock and promote the Giorgio line. The Company was able to negotiate from a position of real strength and demanded, and received, prime space and location in every store that carried the brand. Sales exploded, the product became an international sensation, a key item in duty free shops and eventually was bought by consumer product kingpin Procter & Gamble.

Giorgio is an extreme example of commercial success. Nevertheless, if one were to examine the most popular fragrance, skin care, color cosmetic, bath and body lines and cosmetic accessories lines sold in various classes of trade (department store, mass merchant, drug store, etc.) from 1950, 1970, 1990 and 2009, the researcher would be surprised by the churning of brands that rose and fell.

Hazel Bishop was one of the most popular cosmetic brands of the 1950’s. Rose Milk was a wildly popular body care product of the 1970’s. Indian Earth was the flavor du jour of makeup products in the 1980’s. Chen Yu was the original classic nail care line after World War II. Francis Denny, Germaine Monteil, Imperial Formula and Alexandra de Markoff were popular specialty store skin treatment brands. All were founded by entrepreneurs, enjoyed widespread distribution, commercial success, fell from grace, and were replaced by a newer generation of entrepreneurial products.

The beauty industry has relatively low barriers to entry. Private label laboratories exist in every area of the country and are eager to satisfy creative demands of new entrepreneurs with fresh product concepts. The ability to bootstrap a product or line exists in the cosmetic industry as in virtually no other. Limited amounts of capital can be leveraged and made to go a long way.

Competition is, of course, very stiff. But competition is brutal in every mature industry. However, in the cosmetic business, there is an insatiable demand for  new, exciting,  and different products. The industry is huge, but the opportunity to identify and fill tiny niches is virtually limitless for entrepreneurs willing to commit to their concepts.

Take a stroll through a Sephora or Ulta store. Virtually every product stocked in these beautiful retail venues was crafted and branded by an entrepreneur in the recent or distant past. Estee Lauder is one of the world’s great brands. However, Mrs. Lauder started in the early 1950’s making a single cream in her apartment. The hugely successful professional beauty salon brands Redken and Matrix were created and nurtured by Jherri Redding and Arnie Mitchell respectively. They are mighty today, but they were like tiny mustard seeds at birth before evolving into industry icons.  

The rise of the internet, direct response, electronic retail, specialty retailers and mall kiosks has changed the landscape for selling all types of consumer products. Today’s cosmetic entrepreneur has more opportunity to penetrate the marketplace than ever before. The beauty of the beauty business is that the truly inventive can enter this marketplace and grow their opportunity at their pace, with limited capital and enjoy a real chance for a successful outcome. This cannot be said about many business opportunities.