On the last post I went through some methods you can use to come up with new business ideas. The most important thing in the process is to create solutions that really enhance people’s lives. Solutions that ultimately empower the users and give lots of value. Those are the ideas that take off.
It’s sometimes not that easy to find new, fresh ideas that tick all the boxes, but some simple innovations are often enough to create social value. You can take an old product or service, something people are very used to and already embrace. Then you create a small innovation that makes it stand out, makes it different and gives users a different experience of the product or service.
Take Virgin Airlines for example. Everybody already used other airlines and it was not an innovation in terms of what the company was doing. It was flying passengers from point A to point B. But the massive difference was the how. They made the experience fun and enjoyable. And their service stood out.
Another way you can create ideas that resonate with your own particular set of interests, skills and passions, is to try and match them together, and make them user centered.
For example, I love to bake. I love to make sourdough in particular because it’s easily digested and doesn’t make you feel bloated, like some other types of bread. So maybe I think that there is room for a bakery that creates designed sourdough bread. The loafs of bread are created in interesting shapes and it’s all very designerly. I then decide to create an app where people can design a loaf and my business makes it for them. This would be a premium service, but maybe I find there is a space in the 30-50 years old creatives’ market. As I’ll need staff, I get in touch with a homeless center that can help me hire homeless people, train them and give them a fresh start. And maybe I start catering for restaurants that like to have very unusual bread in their table baskets.
This example illustrates how a business can create something new, provide a good product and create social value. It’s a full circle. This way, you create a viable business, give value to your customers and create value for your society. Make sure you always close the loop and give back to society.
A business can only do 2 of the 3 following things: Be cheap, be fast or be good. It cannot be the three at once. A business can be good and fast, but it cannot be cheap as the cost of being good and delivering quickly means they have to raise their costs. So they will have to be good, cheap, but more flexible with delivery.
So you can scan your market and look at what other people might be doing. Which combinations are they using? Then choose your unique combination, add your unique skills, and create something fresh in a market that already delivers similar products and services.
Some people might think that competition is bad and that if you want to have a business it should be a completely new idea. And this is far from the truth. Competition is excellent. Firstly it proves there is a market for your product, then it gives you ample examples of what works and what doesn’t, it gives you a map of market behaviour, and lastly it keeps people delivering the best possible product.
I am sure you have heard of the Sharing Economy. This term refers to business models where people literally share their time, their belongings, their houses, etc. Two of the companies that are most famous in this sector are AirBnB and Uber. AirBnB is a platform for users to rent a room in their house to strangers. Like a home-hotel. People put pictures of their house then travelers can pay a fee to stay for the night. Users can also rent the whole flat or house for a short term period. AirBnB has been incredibly disrupting in the hotel business as you can imagine, but if you first heard of this idea when it first started in 2007, you probably wouldn’t think it would take off… wait, renting my house to a complete stranger, with all my things in there?… But it took off massively and it’s now valued at 1.3 billion dollars and it is used in 192 cities in the world.
Uber has a similar model. They created a platform (an app) where people needing a cab input their location and destination and the nearest Uber driver picks them up. They don’t own the cars, they just provide the platform for someone with a car to become a taxi driver whenever they choose to for as long as they want to and make a bit of money.
It’s good for the passengers because they don’t have to wait long, it’s secure because drivers all get checked and the system tracks exactly where you are, and it’s flexible for the drivers because they can choose their hours and routes.
These business models are so disruptive because they are shifting how things work. They don’t own the products sold or give the services, they just provide the platform to join the providers and the people who need the service.
And there are so many other examples of this… Alibaba, Udemy, Facebook… They are all just platforms.
I’ll talk more about creating business models in the following posts, but for now that’s all, and I hope this was valuable. Find a way to contribute to the world using your unique skills and experiences and the specifics will follow naturally.
Know the direction and the path will appear.
Designers For Humanity
Diana Simpson Hernandez