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DEVELOPING NEW BUSINESS IDEAS80

per cent of new business ideas originate from this source (see Figure 3.2).

First-hand observation of user behaviour is an excellent technique to
reveal the information and insights which you need to get right inside
your home market. User observation allows you to see at first hand
areas of the market which the product or service intends, but fails, to
reach; it can also reveal unexpected and initially unintended uses for
the product. This holds true not only for existing products but also for
new products and services, when prototypes come into their own, as
we shall see in Chapter 5.

There are two discrete user groups whose actual behaviour should be
observed in order to reduce your reliance on assumptions or third-party
information on how existing products and services are currently used
in the market. The first group comprises users at the heart of the
conventional market (core users), while the second includes those at
the edge of the conventional market (lead users).

the technique of observing core users Patterns of usage

among core users which run counter to conventional wisdom and to
intended market positioning represent a potentially rich source of new
business opportunities.

Harvard Business Review reports that when General Mills undertook a
series of field visits in order to understand the market for Cheerios, it
discovered that consumers were using its product not just as a breakfast
cereal as it had imagined but as an easy-to-dispense snack for children
throughout the day.60

The Lucozade brand was initially associated with illness and
convalescence. SmithKline Beecham’s observation that many
consumers purchased the high-glucose drink as a pick-me-up as well as
for illness prompted the company to develop a new positioning as an
in-health product. This positioning was further reinforced when
Lucozade was relaunched as a sports drink in the 1980s.

Kleenex was initially intended as a niche product, serving as a
disposable cold-cream remover. Only when consumers started to wipe
their noses with the product did the Kimberly-Clark Corporation see the
additional opportunity and reposition the product as a disposable
handkerchief.

The dangers of ignoring the core user are illustrated by Johnsonville
Sausage Company before it was turned around during the 1980s by a