Distribution & Pricing hypothesis
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Goal
Develop a distribution channel strategy (how the product will get to the customer) & pricing model
Checklist
- How will your users initially buy from you?
- From a salesman directly from the company?
- From a representative or distributor?
- Through a partner?
- In a retail store? Mail order? On the web?
- Pick a distribution channel
- Draw the distribution channel diagram
- How much will the channel cost (direct expenses or channel discounts)?
- Are there any indirect sales channel cost (presales support, channel promotional dollars)?
- What else is need for customers to use/buy the product? How do they acquire those pieces?
- What is the net revenue after channel costs?
- If there are products somewhat liek ours...
- How much do customers spend for them?
- How much do they pay to do the same thing today?
- What is the economic basis for your pricing?
- Comparable products that already exist?
- The sum of the piece parts required to assemble the equivalent functionality?
- A return on investment analysis of saved time, money & expense (in a New market)
- Do you want to exchange the existing rules of pricing? Offer new pricing models?
- How many copies / number of products can you sell at once?
- Per household or company?
- If the product was free, how many per household or per company?
- How many can you sell?
- If you charge \$1,-?
- If you charge \$1 milion?
- What is the price at which half of the customers say 'yes'?
- If users had your product:
- How much would they pay?
- Pick a preliminairy price
- Pick units for the first 2 years
- Would it be easier to sell your product if it were
- Sold in modules that individually cost less?
- Configured as a complete solution?
- Sold with other products?
Exit deliverables
- Tentative Pricing strategy
- Tentative Distribution channel model
- Tentative Deman creation activitities
Part of: Customer Development Checklist - Customer Discovery Part of book: The Four Steps to the Epiphany See also: Distribution channels
