Business Versus Feature

Posted by Jeff Carter
on August 14th, 2012

Unemployment is brutal. Lots of folks are out of jobs. One of the positive outgrowths is they are starting to look at the world differently. They are trying to solve problems. Solving problems is how some businesses get started.

Over the past several months, I have seen a lot of business plans. Some are really scalable businesses like Smarteys or Kapow Events. There is a road map, and you can see how the business could grow.

Other businesses are just features. Andy Kessler wrote a great book, Eat People. In it, he described a business proposition he heard where the entrepreneur designed a soap that would apply high SPF sunscreen in the shower. Kessler commented that instead of building the business, he ought to sell the idea to a soap company and move on.

Too often, people get enamored with building a company around a feature. They even prove that the market is huge. However, features don’t often become scalable companies. Features are things that scalable companies can build in. They give the consumer a reason to stick there.

One of the first things we learned in a selling skills training program I did when I was at 3M was to FAB customers. Feature, Advantage, Benefit. If you were a good salesperson, you learned how to do this naturally. At the beginning, the rookies just “puked” all over the customer. Features never sold customers. They were talking points that lead to benefits.

Features rarely become scalable businesses. It’s more likely that a feature could become a scalable business in the IT/Digital Media space than anywhere else. Instagram and Twitter were two features of Facebook. Google was just search. However, those features had a huge tangible benefit to the user, and so a business could develop around them.

It’s rare in a consumer products company that a feature becomes a company, unless it’s totally out of the box and innovative. Nike was started with a waffle shoe. It was so radical, distance runners clamored for them. They were able to build a company off that one feature. However, unless you think of something really out of the box today, it would be very hard to build a new shoe company out of a feature. Might be better just to sell it to Nike.

If you think about some of Apple’s ($AAPL) great innovations, they are features they bought. Siri is a feature. You might be able to build a phone company out of Siri, but it would be awfully tough. Smarter just to sell the idea to someone that can scale it.

What features do you see that could become great companies? What companies out there that are “features” do you think should market themselves to other companies?

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