Sunday, April 26, 2015

Bonnie Gloris: Generating “Effective Demand”



This week’s topic is Ready, Set, Go (and Grow)!: Launching and Growing a Social Venture. In the Nesta (the UK’s innovation foundation) report Making it Big: Strategies for Scaling Social Innovations, author Madeleine Gabriel states that “social innovations can be said to have scaled when their impact grows to match the level of need.”

That’s precisely the approach the iCraft Path team is taking with our venture. In our client presentation earlier this week, we proposed a multi-tiered model for iCraft Path, with each version building off the previous version, not replacing it. This technique for scaling the business will enable our client to gauge the public’s interest level on an ongoing basis, and to respond accordingly.

The first iteration we recommended for iCraft Path is to create an aggregator of existing resources, and work with existing providers to make their services more crafter-friendly. We think that our client is an excellent spokesperson for crafters, and that she could be very helpful in working with resource providers to make their programs more accessible to crafters. We recommend having the website exist separately from her original venture, I Made it! Market, to ensure that all regional crafters feel welcome, not only those currently associated with IMI!  Advertising fees from relevant companies could be utilized to offset the cost of creating and maintaining the site.

The second version of iCraft Path would build upon the first version, but also offer original content to members. Crafters are receptive to the idea of paying inclusive membership dues, as opposed to one-off fees. Our focus group discussions suggest that crafters are not willing to pay more than $100 for such a membership. Our client might consider offering individual consulting services as a resource. This version would rely on strategic partnerships with other organizations – for example, being a member of iCraft Path could entitle crafters to a discount at partnering organizations for classes or supply discounts. 

The final iteration of iCraft path, Version 3.0, incorporates shared space into the resource, including workspace, retail space, and community space. The financial investment and risk of a shared space is significant, so we feel this version of the venture should be approached with extreme caution, only once “effective demand” (as phrased by Gabriel) has been generated.

We know that creating sufficient demand for each eversion of iCraft Path will rely, to some extent, on effective marketing by our client. One thing our team has struggled with throughout this project is the idea of “need” vs. “want”. Do crafters truly need the service that iCraft Path proposes to provide? If they say they want our services, does that mean they will actually use them? 

I decided to look into how to approach this issue, through the article Need vs. Wants in Marketing. Based on Neil Kokemuller’s description of finding the “dominant buying motivation of a customer to present the most persuasive messages,” my inclination is to appeal to crafters’ emotional needs in marketing iCraft Path: the desire for financial independence, validation of talent, etc. could be taken into accounting in developing a marketing strategy.

Has anyone else run into this dilemma of need vs. want in developing their ventures? If so, how have you gone about resolving it?

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