Turn Your Know-How into Revenue: Productizing Your Small Business Secret Sauce
As a small business owner, you likely have hard-won expertise that forms the bedrock of your success. You’ve refined processes, created intellectual property (IP), and developed a keen understanding of your customers over time. This accumulated know-how is the special sauce that sets you apart. But are you leveraging it to its full potential? Productizing your expertise for resale represents a lucrative way for small businesses to extract more value from their insights and create new revenue streams.
What Does It Mean to Productize?
Productization involves packaging knowledge, IP, or processes into standardized products that can generate repeat revenue. This allows small businesses to multiply the earning potential of their differentiators. Often, but not always, such productization will be packaged with some technology to automate, streamline, and protect the process to allow for revenue maximization. Some examples include:
A social media advisor who creates a DIY Instagram marketing video course.
An interior designer who licenses decorating templates or 3D models.
A marketing firm that develops a turnkey direct mail program for clients.
A chef who bottles up signature sauces and spices to sell.
A business consultant who codes her proprietary planning framework into software.
A salon owner who formulates a signature haircare line.
The options are endless. Productization works for any expertise that can be systematized, formatted, or codified for simplified delivery to a wider audience. The value lies in reproducing your know-how at scale.
The Benefits of Productizing for Small Business
Turning your expertise into digital or physical products offers multiple bottom-line benefits:
Tap into new profit pools – Products represent incremental income from your existing intangible assets. Your first video course, app, or template may take time to build, but from then on they can generate mostly passive revenue.
Diversify beyond services – Products provide income diversification to smooth out the ups and downs of a service business. Products sell 24/7, allowing you to monetize while you sleep!
Reach new customers – Products often appeal to niche audiences outside current customers. Someone unlikely to hire your consulting business might happily buy your $99 online course.
Extend your brand – Products also grow awareness of your brand’s expertise, driving interest in your core services. They showcase your capabilities in a tangible format.
Scale strategically – Products allow small businesses to grow their impact and profits without adding substantial overhead. By contrast, scaling services demands hiring more staff.
The Risks and Challenges
Developing sellable products from your IP has risks and challenges to navigate as well. Two common pitfalls are:
Offering undifferentiated products – Your knowledge has to be framed into something customers truly need and can’t get elsewhere. Avoid building generic products with lots of competition.
Getting distracted from core business – Keep your core services the priority. Don’t let product development absorb too much focus unless you’re strategically pivoting your model.
Other hurdles to evaluate include upfront development costs, building sales and marketing capacity, adding backend fulfillment systems, and providing ongoing customer support. Automation, outsourcing, and starting small can help minimize risks. But weight your readiness to add these new competencies.
Making It Happen
Follow these steps to successfully turn your intellectual property into profit:
Identify your “secret sauce” – Analyze what makes you special. Extract processes and approaches that yield your advantage. Prioritize areas with greatest differentiation and market appeal.
Choose the right product format – Consider the best format to deliver your expertise. Possibilities include online courses, software, tools, physical goods, licensing your IP, franchising a business model, and more.
Specify the product bundle – Map out the components and resources customers need to benefit from your know-how.
Design experiences strategically – Structure products to deliver amazing experiences, not just information. Lean on your customer knowledge.
Validate demand – Talk to real prospective buyers before investing heavily in product development. Pre-sell to prove the concept.
Build a repeatable model – Design products for effective, low-touch selling. Automate fulfillment. Plan to iterate based on customer input.
Market creatively –Blend digital promotion, partnerships, and unconventional outreach to cost-effectively launch and grow awareness.
Monitor upside vs. risks – Track sales data, customer feedback, brand impact, overhead costs and more. Tweak and refine over time.
With the right strategic approach, small businesses can mine their expertise to drive new income streams. Converting your special sauce into digital or physical products aligns beautifully with capitalizing on what makes you uniquely special.
Where your productization involves digital components, Bright Ideas Agency can help you with advisory and technical services to turn your ideas into reality, and your specialist knowledge into income. Just get in touch to discuss your needs.
