Often entrepreneurs come up with their business idea because of their own personal experiences or that of someone in their circle of friends & family. This is a great strategy but sometimes doesn’t tap into a market large enough.
In episode #850 of Planet Money, The Fake Review Hunter the hosts interview Tommy Noonan, creator of SupplementReviews.com. SupplementReviews.com is a highly popular website that provides unbiased user reviews of health supplements. However, Tommy soon found that there were reviews that were suspiciously positive. Because Tommy’s entire website was based on authentic user reviews, fake reviews became an existential threat. After a lot of research, he found that some of these reviews were being written by the supplement companies themselves. He uncovered so many fake reviews that he started noticing a pattern; almost like a modus operandi. They were often single product/brand reviews, used fake pictures, lots of reviews in a short period of time, and/or only had one review. Sometimes the “reviewer” would give positive reviews for one brand and negative ones to competing brands.
This is when Tommy had his a-ha moment. If his website had fake reviews, others would also probably have them too. So he created another business that aligned with one of the juggernauts of the internet, Amazon. Tommy’s site which uncovers fake reviews is called ReviewMeta.com.
How to find a need
As mentioned at the top of the post, most rely only on their personal experiences or that within their network. Sometimes the need is obvious. For example, at a 7-Eleven in Shirley, New York one 7-Eleven sells more coffees than any other franchise in the US; all because of one store manager than knows virtually every customer’s name and greats them. No special location mojo or customer flow algorithm, just old fashioned customer service. You can read more about it in my post Competitive Advantage and Coffee.
Other times it is not that obvious. In that case, you have to hustle in a different manner. How do you do more “work” when you’re already working to the bone? Find efficiencies: know your customers, know your competitors, lower your expenses, by working to learn more doing more research in episode #700 of Planet Money, Peanuts and Cracker Jack. In Boston’s Fenway Park, Jose Magrass is the top seller. One year, on opening day he sold 500 hot dogs, $2750 worth of hot dogs in a single game. In fact, Jose has been the top seller for over 5 years. Part of his secret? He has a spreadsheet where he analyzes many factors beyond just the weather such as what his competing vendors are selling and what fans are likely to purchase depending on the price of their seats. For example, behind home plate diet coke sold better because possibly that is where the “vain people” sit. That kind of analysis is impressive.