Entrepreneurs often see a need through their own personal experiences and fill that need with their business idea. 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 host interviews 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 suspiciously positive reviews. 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 written by supplement companies. 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, had 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. 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 who 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 differently. How do you do more “work” when you’re already working to the bone? Find efficiencies: know your customers, know your competitors, and lower your expenses by working on learning 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 five 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.
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