For six years, Violight, a $9 million company based in Yonkers, New York, has made products that zap germs off of toothbrushes with ultraviolet light. This fall, the company plans to launch a device for sanitizing other bacteria-laden objects: cell phones.
Violight founders Joel and Jonathan Pinsky, who are father and son, came up with the idea a few years ago after a news station in Charleston, South Carolina, called to ask if it could borrow one of Violight's products for a story about germs on mobile phones. "The light bulb went on," says Jonathan.
But launching the product wasn't so simple. Although a cell-phone sanitizer employs the same technology as a Violight toothbrush cleaner, the markets for the two products are different. The Pinskys, who have traditionally sold their products in drugstores and in specialty retailers like Brookstone, had to work hard to get their cell-phone sanitizer into electronics stores -- making countless phone calls, attending trade shows, and flying across the country to meet with buyers.
Adapting a product for a new market is never easy. What worked in one industry may not work in another. Navigating a new industry often means learning new distribution channels and new customers. "You may have heard one potential customer [in a new market] get excited about your product," says David Hennessey, a marketing professor at Babson College, "but you need to be sure there is more than one guy out there, that a real market exists."
The first step is researching the industry. That was the jumping-off point for Kelly and Jeff Fitzsimmons, the married founders of HarQen, a Milwaukee company with 10 employees. The couple's company began as a free online service that let users record jokes over the phone and e-mail the recordings to friends. But the ad-supported website struggled to generate revenue. One night, as Kelly and Jeff brainstormed other uses for HarQen's technology, they had an idea: What if recruiters could use this software to conduct automated phone interviews?
That night, Jeff began researching the employment industry. He poked around the Department of Labor's website, on which he read that some 60 million people get hired in the U.S. each year. He then perused websites of trade publications and industry associations. Those sources helped him better understand the recruiting business and get a handle on industry jargon.
Still, the Fitzsimmonses weren't sure if there was really a market for their idea. So they began setting up meetings. As the couple worked to develop a prototype that would let recruiters record interview questions and send them to candidates, they asked everyone they knew -- friends, employees, board members -- for contacts in the staffing industry.
The company's attorney happened to be a close friend of an executive at Manpower, the giant staffing firm headquartered in Milwaukee. He got the Fitzsimmonses a meeting. Jeff recalls that the executive seemed less than impressed with the couple's business cards, which carried the company's original name -- ComicWonder. The Manpower exec said bluntly, "I'm only meeting with you because a friend asked me to." But after seeing a demo, he told the founders they were onto something.
Over the next six months, the Fitzsimmonses spoke with several recruiters. The conversations typically centered on the recruiters' problems and goals. "The key is listening," says Kelly. "We'd take that information and update the prototype weekly." The meetings proved beneficial. About 50 customers now use HarQen's product, Voice Advantage, and the company expects sales to exceed $1 million this year.
Just as it's helpful to meet with potential customers, it's important to research possible competitors. That's what Bob Purvis did after he got a phone call from SMG, the company that manages the Superdome. Purvis's company, Intech Studios, which is based in Alexandria, Louisiana, makes software for monitoring equipment problems in factories. SMG wondered if it could use Intech's software to track security issues and maintenance problems inside the New Orleans stadium.
Purvis thought Intech could probably modify its software to fit the Superdome's needs. "We knew our product already had about 80 percent of what they needed," Purvis says. But before he developed a product targeted at sports venues, he wanted to know how stiff the competition would be. Purvis pumped SMG executives for information about other applications they had considered and why the other programs had fallen short. He came away with the names of two potential competitors.
Purvis scoped out the rivals' websites to see which features the two companies offered. He also wanted to find out what they charged. He tracked down some pricing information in a trade magazine article and talked with SMG about the quotes it had been given from his competitors. Given that information, Purvis figured Intech could offer a competitive price and still make a profit. The Superdome now uses Intech's new software, EventTraxx, and Purvis expects to have another six to eight customers by next year.
If, on the other hand, you don't know anyone in the new industry, it can be tougher to break in. That's what Joel and Jonathan Pinsky discovered when pitching their cell-phone sanitizer.
The Pinskys lacked contacts in the consumer electronics industry, and Joel was against cold calling. "They don't know us, and they get bombarded every day with pitches on new products," he says.
Joel started asking around to see if anyone he knew had a contact at Best Buy. An employee at a trade magazine in which the Pinskys advertised put Joel in touch with Best Buy's media relations manager, who helped Joel reach the buyers. After one of them expressed interest, Joel flew to Minneapolis for a meeting. Best Buy agreed to sell the cell-phone sanitizer on its website when the device launches this fall. The Pinskys also hired an outside sales firm to help get the cell-phone sanitizer into electronics stores.
Now that Best Buy is on board, the Pinskys are hopeful that the product will have a grand debut. They expect to sell 50,000 units by the end of the year. "In consumer electronics, it's all about what's new and what's cool," Jonathan says. "We want to launch with a bang."