Enhance Productivity and Efficiency with Stephen’s Innovation Insights

Innovation Insights by Stephen Shapiro

I am sunning myself with my family in Florida right now, hence the shortage of blog entries. We have been busy every day, so today has been my first day to relax and think. And no surprise, I have been thinking about innovation.

The balcony of my timeshare overlooks the water with boats (the picture left is our view). I always wanted a boat, but am often reminded of a joke. “What are the two happiest days in a boat owner’s life? The day he buys his boat…and the day he sells it!”

Boats are expensive and a pain to maintain.

In my previous blog entry, I discussed ways of making products and services more accessible and affordable. One idea was to “productize” a service. The question of the day is, how can boats be made more affordable and accessible? Maybe the answer is to “servicize” a product.  Let’s look at a few options…

Option 1 – Make Product Cheaper: If you want to make boats more affordable, you can make them less expensive and maybe easier to maintain.  As an owner this gives you the greatest flexibility and unlimited access to your boat.  Of course, you need to do all of the work.

Option 2 – Timeshare: Most people only want a boat from time to time. So another logical solution is to create a boat timeshare. A quick Google search shows that there are quite of them out there. With this model, a corporation owns the boats and sells “slices.” Yesterday I met a couple that get to go on a yacht for one week each year in a different location.  This is nice if you only want a boat infrequently.

Option 3 – Fractional Ownership: Another option is “fractional ownership.” Instead of a corporation owning the boat, the individuals that use the boat own the boat. They split all costs.  This gives you greater flexibility with potentially more work.

Option 4 – Netflix Model: The most interesting option is one that uses the Netflix model. This gives you unlimited access to a number of boats. You get two reservation slots. As soon as you use one, you get another. This gives everyone equal access to the boats they want, yet does not restrict how often they can be used. You are also not limited to one boat or one location, but rather have many to choose from.  The company that owns the boats maintains and cleans them. The only additional cost to the renter is fuel. The total cost per year is less than the cost of the boat slip dues. One company that offers this is the Freedom Boat Club.

There are pluses and minus to each model.  Different options will appeal to different people.  The key is to recognize that there are many ways to sell and price your products and services.

I love the Netflix model and believe that it can be applied to many different businesses. I am in the process of creating a Netflix consulting model that will give clients unlimited access to me for one monthly subscription fee. It will be designed in such a way that everyone gets equal access.

What other creative options are there for offering affordable and accessible products and services?

  1. This is a fascinating — and very timely — topic. Everyone should be asking how to make their offerings more accessible. I was particularly impressed with how you flipped around Everett Rogers’ Diffusion of Innovations Curve in your prior posts — putting the laggards first. The last shall be first, right?

    Britton Manasco
    Illuminating the Future

  2. Thanks Britton.

    Very observant. Yes, the curve is flipped around. Rogers was talking specifically about the introduction of new technologies. I am using the curve to match customers and capabilities.

    Here’s how I look at it.

    The customer base is a bell curve as I drew it in the previous entries. This is the level of sophistication, of sorts.

    Your capabilities (the products and services you offer) have their own bell curve of sophistication.

    The problem is, most companies only study their existing customers – the middle of the bell curve. They rarely talk to customers who left because your products/services are not sophisticated enough for their high end needs. And they even less frequently study markets in which potential customers are viewed as laggards.

    Therefore, new products and services tend to only hit the middle of the bell curve.

    But it is the two “margins” of the bell curve where the real untapped opportunities lie…in my humble opinion.

    Thanks!

    Steve

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