Inventors, you're doing it all wrong!
Most inventors observe a problem and then attempt to come up with a solution for it. When they've invented one, they shop that solution around for licensing consideration (or try to build a business around it).
But this strategy is problematic, particularly as it relates to licensing.
What is licensing? When you license an idea, you're renting it out, basically. In exchange for your creativity, your licensee does the heavy lifting of bringing it to market, including manufacturing, marketing, and distribution. Your licensee should already have shelf space in the stores you want to sell in. This company is your perfect partner. The big benefits of licensing as a business model are speed to market and less risk.
Inventing a solution and then making a list of companies that might be interested in bringing it to market for you is not the best way of going about this process, though. Sometimes you might get lucky. But more often than not, you may feel as if you are trying to squeeze a round peg into a square hole.
There's an easier way. If you want to improve your chances of licensing an idea, choose to create for a specific company. Design products with that company in mind specifically.
This strategy is quite a bit different than attempting to sell a concept you've come up with out of the blue.
I licensed my ideas for products for many years. And what I know for sure is that it's much easier to hit a target when one is in front of you.
Think about it. To keep up with global demand, companies come out with new products every year. Multiple times a year, actually. That's the responsibility of their in-house product development team.
Why not beat them to the punch?
If you're creative, there's a legitimate opportunity here. Most designers are overworked and under-appreciated. They're being told what to do, when to turn in their ideas, and receiving little recognition in return. They're not motivated by their love of design.
You can out-design them. Believe me, I've done it.
Why am I so sure? Because, as an independent, my guess is you're willing to work past 5 o'clock. You'll be thinking about how to improve your prototypes on Saturdays and Sundays. You won't be able to stop thinking about your ideas. Basically, I think you'll be more excited and motivated than the highly talented designers these companies employ.
First, you must act like a detective, meaning you need to do your homework. That's the only way to identify holes in the market, where the opportunity to innovate is ripe.
To succeed at licensing, you must approach the right companies with the right ideas. If they're selling apples and you've got oranges, you're wasting everyone's time.
Here's how to get started inventing for the marketplace.
1. Read the company's mission statement. Who is their target audience? Consider what isn't being said as much as what is. What is the company's point of difference in the market? What are they known for?
2. Study the company's product line closely. What do these products have in common?
3. Make note of how much their products retail for. To see the light of day, your concepts must hit similar price points.
4. Consider the materials being used. Investing in new manufacturing technology is prohibitively expensive. Remember, your goal is to make it easy for them to say yes.
5. Read product reviews on Amazon and other websites. This is the largest focus group in the world! What are consumers saying? What are they complaining about? You may uncover a nugget of gold. Seek out additional insight on industry blogs and YouTube channels.
6. Visit brick and mortars in person. When the store is slow, ask the manager for his or her insight. What do consumers like about these products? What they don't like? What's selling?
7. Closely observe people using these products in person for further insight. Observing user behavior is a key component of design thinking.
8. You could even call the company to ask pointblank what they are looking for. After all, you want to work for them. But instead of collecting a paycheck, you'll collect royalties.
This approach is more likely to lead you to success because it's targeted. It's professional. You're focusing your creativity. Inventing new products becomes almost scientific this way. And in my experience, which includes coaching product developers from 60 countries, simple improvements to existing products are what get licensed.
Big-picture wise, my hope is that companies become more transparent about what they're looking for. If you embrace open innovation, why not give product developers who want to work for you more specific cues? There's little risk in doing so, but the potential rewards are enormous.
For example, when I interviewed the head of a novelty gift company that relies almost entirely on open innovation, he told me very explicitly what they were looking for -- and more importantly what they weren't. It was truly an eye-opener. After I understood how and why the company was founded, it all made sense. But none of this information was stated anywhere on the company's website, even though they explicitly invite inventors to study their product line and submit their ideas.
Sure, they're inventor-friendly. But they're not providing any direction! Sometimes it can feel like mind reading is required. Stay the course.
At the end of the day, what you're trying to do is find a home for your idea. So please, if you get rejected, make sure to politely ask why. Opening up a dialogue is the most important thing you can do. So dig a little deeper.
It's our job to keep the doors of open innovation open. For these companies to receive and review our product submissions, time and expense are required.
If you want to become more successful at licensing your product ideas, focus on inventing for the marketplace. Stop throwing your ideas against the wall to see if they stick!