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Portfolio > ETFs > Broad Market

Inside Products: The Importance Of Being First

By Staff Writer

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The Importance Of Being First

Are you an “early adopter?” I am. Sometimes.

I add new software to my home computer as soon as it debuts. Also new peripherals, updates, and enhancements. I do this fearlessly, since tech is a hobby. I figure, if something goes wrong, I can fix it.

But not so with buying a brand new type of auto, or being first in my group of friends to eat, say, chocolate-covered ants. I don’t know beans about cars or ants, and don’t want to. Let someone else blaze those trails.

Now, to you and your firm. Earlier, I asked, are you an early adopter?

More to the point, do you design cutting-edge products and put them on the street first? Do you sign up your agency to sell an innovative financial product or concept that no peer has ever seen? Do you stick your neck out that far?

If you havent been asking these questions, now might be a good time to start. You see, many financial product manufacturers today are stepping up efforts to produce and distribute all kinds of Firsts. The trend is far more pronounced than I can ever remember.

This is bound to affect you, whether youre in the field or home office, for it raises several issues: How do we assess the new designs? Should we add them to our portfolio? Can/should we respond in kind with innovations of our own? Where is all this going?

Promoters of today’s Firsts make no bones about their motives. Being First, they tell me, is mission critical to survival. They believe it gives them a leg up on the competition, bolsters brand awareness, helps expand sales to existing and new markets, and paves the way for market dominance.

So committed are these marketers to Firstness that they increasingly bring news of their Firsts to National Underwriter on a “first-crack” and/or exclusive basis.

Of course, the race to Firstdom is as old as the hills. But today, as I have said, in the insurance and financial industry, this race seems more keenly run than ever. If you need proof, ask any actuary worth his or her eyeshade.

Whats behind it?

The balmy scent of Firstness certainly has something to do with it. With its mixture of freshness, sparkle and newfound opportunity, a First-of-a-Kind product can draw producers and clients the way flowers do bees. The Great Aha can be intoxicating.

But the real kickers are more rational, I think. They are: 1) the economy and 2) technology.

You see, today’s economic doldrums have spurred financial product developers to intensify efforts to woo business. This has spurred them to debut all-new products–ones they think will turn heads (and sales). And, to do so efficiently and effectively, they have turned to a ready allytechnology, still the widely perceived rainmaker for unique design as well as sales and policy support.

Thus, in todays market, you see rollout after rollout of Firsts, many of them festooned with Web site-this and database-that. Its a mad dash to the finish line, computer-style.

But is that for you? Here are some ideas to help you think it through. Theyre gleaned from conversations with contenders in this very scrappy race.

1) Be sure your target market needs, and can afford, your product. Don’t bring out a First just because you can. Rather, do it because it’s what your clients want. Focus groups and market research will help you here.

2) Be sure you have deep pockets. Being First costs a lot. There is the R&D investment. The systems development. The staffing. The education. The advertising. The seminars. The training and explaining. Etc., etc., etc.

3) Make sure you have the wherewithal to address the problems that come up. Most people seek out Firsts in areas where they have knowledge, but steer clear of them in areas where theyre clueless. In short, make your expertise your safety net.

4) If you say you’re first, be prepared to prove it. Your credibility will go kaput if other players roll out something similar at the same time as you and/or in another region. As we all know, any cowboy billing himself as the Fastest Gun in the West, back in the Frontier days, had darned well better be fastest–or he risked sudden death.

5) Encourage “Me-Too” (copycat) players to join you. Its a case of the-more-the-merrier. This brings credibility to your innovation, and greater public awareness, too. If other players don’t jump in, consumers or the media might deem the singularity of your product “suspect,” thus crimping sales.

6) Keep on the lookout for trouble. You dont need to rain on your own parade, but you do need to protect your innovation from harm as it makes its market entry. Harm can result from many things–confusion about the product, lack of identity, systems problems, low consumer interest, competitive challenges, etc. “The problem is, you don’t know what you’ll find til you get there,” says one expert. His advice: Monitor the rollout closely, and be prepared to shift gears on a dime.

There is no doubt about it: Being first to market is a thrill, not unlike skiing on fresh snow. It awakens excitement in a way nothing else can.

But precious few can get there, or stay there for very long. What then?

That is the time to concentrate on Plan B: The Importance of Being Earnest. By that, I mean, dont get bent out of shape. Approach your situation with the good humor of a friendly competitor, reminiscent of that in the 19th-century comedy of the same title by Oscar Wilde.

But also be Earnest about your endeavors. Show the market you are committed, resilient, and eager to succeed. If you keep it up, who knows, you might one day be First in sales, if not in innovative product launches.

Reproduced from National Underwriter Life & Health/Financial Services Edition, August 6, 2001. Copyright 2001 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.

Copyright 2001 by The National Underwriter Company. All rights reserved. Contact Webmaster

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