Businesses survive and prosper when they meet and satisfy consumer demands. In order to offer a winning product or service, entrepreneurs need to gauge the market, identify gaps and fill the gaps by providing what consumers want. Once the product catches on and is bought by consumers, the money starts flowing in, profits build up and the business becomes successful.
At this juncture there are two things that entrepreneurs can do. They can sit back on their laurels and see the money roll in. Or they can invest their profits in new products, new services which are an improvement on what they had produced so far, or which constitute a totally new line of product or service.
Needs and desires are changing
If they decide to exploit the initial earnings from the initial product, they will have profits coming in for a while. But it is necessary to understand that successful products can continue to rule the market only till they are not replaced by competition.
But in today’s world, the marketplace is becoming very competitive whether it is local, national or global. Consumer needs and desires are changing – they are becoming more demanding and less loyal. New technologies are being born , new products are being launched , new modes of communication are alerting consumers to these new products.
Product or service becoming obsolete
With the advent of newer better products and services, the older ones start taking a back seat. So what was successful yesterday, loses out to the new improved versions of today and stop selling. This leads to a fall in profits, earnings and finally leads to the product or service becoming obsolete. So depending on currently successful products to sustain your business in the future seems to be an option fraught with the dangers of failure.
Successful entrepreneurs realize this truth of the business world and take the initiative to beat the market. They innovate on their offerings before they become obsolete or before competition comes up with better products and services.
Visionary entrepreneurs plan for the possible obsolescence of their products and innovate constantly so that they are always ahead of their competition. Their innovation can take the form of an improved product, newer product features, better technology to produce better quality of the same product, or maybe a completely new line of product or service that could complement the existing product. They study the market and gauge what consumers could want instead of what they have and then they work to fulfill those consumer needs. If consumers want newer, improved versions of exiting products, then that’s what should be offered and if they want something totally different, entrepreneurs need to realign themselves to offer something new
The economy progresses when businesses flourish. And in order to grow and sustain the growth, businesses need to constantly evolve and change along with changing consumer needs and with the growth in competition. Given this situation, innovation and new offerings in place of older ones, thus become the touchstone of entrepreneurial success.