Starting the Venture
Being a methodical and thorough business person, Matt began diligently researching the prospective market he was about to enter which he knew nothing about. He wanted to find out everything he could about this marketplace to ensure that the money, time and his livelihood he was willing to bet on such a venture was a reasonable gamble. “I did research to find out if this sort of product exist yet and how big the market was. People sometimes get too excited and ignore the current marketplace.” To expand his research Matt visited trade shows, read through various trade journals and magazines, went to retail stores and even went to the Supershow which is the world’s largest sporting goods trade show to gather input and ideas. The conclusions from Matt’s research demonstrated that the binocular market was a stagnant and relatively focused market that catered to individuals using binocular products for traditional and passive uses such as bird watching, hunting, and boating. This reinforced his idea of turn the industry on its ear by giving binoculars a whole new look and attitude, and to conceive new uses and market it to a whole new marketplace of consumers who may have never given too much thought about buying binoculars at all.
Initial product development and concept evolution was done by Matt himself with the assistance of his willing family and hints from existing binocular products. “I bought four or five pairs of binoculars to study and got brochures from every single binocular company I could identify.” The prototype was made with a lump of molding clay that Matt fashioned with the help of his children who were invaluable for some of the features on the binoculars that are being mass produced today. The rainbow colored focus dial was an inspiration from one of Matt’s children that proved to be a novel way for the consumers to be able to remember which focus setting was correct for them. As with many new ventures, the founder is called upon to take on responsibilities they may not be accustomed in performing such as this model development, but need to take on so their vision can unfold as the entrepreneur has formulated, “In those early days I was working hard to implement the plans from the entire vision of this business that came to me in an instant. It all came at one time, the plan, the prototype and the market.”
Concurrent with the establishment of the marketplace opportunity and the product look was the work Matt did in developing th e brand identity and the entire appearance of the product and its supporting components such as the packaging, collateral material and promotional items. “During a trade show I saw two companies with products in packaging that I knew was the exact brand presentation that I wanted for my product. I liked the packaging and felt it would speak to the audience that I wanted.” After querying the companies for who their designers were, Matt learned that both product’s packages were designed by the same firm which he ultimately sought out to establish a business relationship with. “I went to this design firm with my clay model in hand and my business concept spelled out. They were a successful design firm that had many high-profile clients which kept them plenty busy. Frankly they did not need my business and were not to keen on working with a start-up venture. But I refused to take no for an answer and I knew they were the firm that I wanted to work with. They were the largest extravagance I was going to have for this venture. Fortunately they liked my product concept and marketing plans and we started working together.”
The next step in the development was to partner with an industrial design firm to get the product concept translated into design drawings and engineering specifications to assess factors such as production costs and material requirements. “I interviewed three or four industrial designers to get the plans laid out. I then hired a model maker to make a more presentable piece to present to prospective partners. I settled on a designer that created the design plans and created a foam model based on those plans to test the feel of the prototype which they call the hand. After this step a hard model was then created which ended the industrial design phase. The next step was to turn the designs over to an engineering designer to make the product manufacturable.” By no means was this a passive process for Matt. He emerged himself in every facet of the products design, development, and ultimate manufacturing process to ensure his vision of the product was met, and the level of quality and product attributes such as cost point were equivalent to his needs. “I became a product engineer and spent days on the phone with manufacturers, film makers, and adhesives manufacturers. I learned a lot about paints and melting temperatures of plastics and how to adhere one material to another…because I had to. You get it done.”
As for his experience with these service organizations that VU Points partnered with to bring the Performance Binoculars to market, his attitude in approaching them and hiring them was one of they are being hired to help you so one should not feel animosity or extreme gratitude that they will offer you their services. They are your service providers and you are paying them for their services, therefore it falls on the entrepreneur to examine them carefully and make sure they will add value to your venture. “They’re just people. You’re pretty much going in and selling yourself. The presentations to brand firms and industrial design firms is to show them your vision and then ask them what they can add to it. They’re interviewing you, you’re interviewing them…it’s a mating dance.”
Maintaining a Virtual Organization
A core strategy of VU Points is to consider how much of its operation will be established and built by VU Points itself and how much will be contracted out in the true fashion of a virtual organization. This feeds off of a fundamental philosophy in emerging business which is “can you buy better than build?” For most of the VU Points operation the establishment of strategic partnerships has been a successful strategy in getting the entire process for product development, production and distribution done to most optimally use the limited resources of a start-up and to free up the founder to focus on those aspects he is most suited to perform. “Through my strategic partnerships I get the talent I need and all of the functional tasks of the business done which includes design, manufacturing, material sourcing, distribution, advertising, PR, and creating satisfaction for the customer. It’s all done with me coming up with a lot of little slips of paper and then communication my ideas to the right partner for execution.”
For his manufacturing, Matt employs a company in Connecticut that creates all of his tooling and molding components which are utilized by the manufacturing organization. This company also serves as the final assembly point for all of the components in the final product once all the components have been produced and shipped to this one location. “They were chosen because of they did the molding and tooling and worked through a lot of the problems, and it’s all in one place to simplify problems and troubleshooting by reducing transportation.” During the early stages of the product’s roll-out, Matt has been on the line for each manufacturing run to ensure the product is being built to is standards, and the efficiencies of production are being met so the costs for his product fall within the levels he has established.
The components for the binoculars and its packaging are sourced from locations all over the world as Matt sought to round out the vision of his ideal product with all the appropriate accessories, “The optics are sourced from overseas and I buy them ready made from one of two manufacturers that produce the identical component which gives me a backup supplier if needed. The wrist straps and carry bags are sourced through several organizations in New England, Mexico and Europe that do the sewing, create the patches, and do the embroidery.” Just as with the production and product design, Matt was intimately involved with sourcing all of the components and accessories to the VU Points product and spent a significant amount of time to find the elements that were right for his product, “When I found the clip that I liked for the carry case I hunted down the manufacturer. I then went through many library books on other manufacturers and distributors to collect ten different quotes and samples. That’s how it’s done.”
There are other benefits to maintaining a virtual organization that cross into the realm of protecting ones business venture and allowing safeguards and controls to be placed on the partner organizations so the business venture’s products and integrity can be protected. The effectiveness and efficiency of the business he has set up is certainly dependent on the amiable relationships he maintains with his partners worldwide. But the inherent dangers of doing business worldwide in places an entrepreneur can not be in all of at once requires steps to be taken to protect ones investment, “This operation has its critical and final aspects of production done domestically because I was sure that production of a product like mine if managed completely overseas would have had product going out the back door. I remember reading a Wall Street Journal article about a woman whose product was being made by an overseas partner, and that partner began to ship it to ten other distributors under a private label name. She was undercut by her own manufacturer at her points of distribution. It was a pure breach of contract but there was nothing she could do.” Matt feels he is able to control the situation by having the virtual environment and controlling all the different elements of the product.
Marketing and Promotion – Bodypiercing and Binoculars?
Getting the word out about his binoculars and spreading the message of what VU Points is has been an assault on many fronts by Matt to reach the various consumers in the various places he wants them to associate his product with. Public relations and product reviews has been the bulk of the promotion he has achieved in the printed media. Matt has devised an in-depth and comprehensive strategy to have VU Points press releases and product put into the hands of editors of the magazines his consumers read to get mentions in these periodicals that would equal thousands of dollars in advertising costs. Rolling Stone, Wired, Playboy and Buzz are just a few of the tens of magazines the VU Points binoculars have been favorably reviewed in and presented with a full product shot. Paid advertising has been on a very strict limit due to the need to carefully allocate the resources of this start-up. He was an advertiser in the first ESPN Extreme Games in 1995 where he employed a free-lance advertiser to create his ad. The only other paid advertising Matt has done is in a current publishing of Playbill magazine for the smash performance Rentplaying in New York City. “It’s all been free PR up until now. The success with the Extreme Games ad has lasted for a whole year with people talking about it and having that image of the ad in their minds.”
The most unusual effort and cornerstone of the public relations activities VU Points has undertaken was following the alternative music tour known as Lollapalooza across the country in 1995 to put the binoculars in the hands of those consumers who possess the characteristics and attitude that VU Points hopes to cater to with all its products. Lollapalooza is known as a day long rock-fest that brings in tens of thousands of young, alternative, X-generation individuals looking to share a group experience in modern and alternative rock music, and the latest fashion and social trends such as body piercing. This tour proved to be an excellent chance for Matt to get his product into the hands of his prospective consumers, and to get valuable feedback and market data with which to improve his ideas and product concepts. “It was a great starting point to position ourselves and in putting the opera glasses of the 90’s into the hand of the 90’s version of an opera which is the outdoor amphitheater concert. MTV’s generation of kids are the ones at these events and it was a good place for me to be.
Following Lollapalooza around to sixteen venues across the country was one of the most trying and draining experiences of Matt’s life. “People tend to glamorize it because of where you are at, but you’re in a 10 x 10 foot space for 12 hours each day in what was one of the hottest summers on record, answering the same questions, reciting the same set of instructions on using the product 800 times a day, and maybe getting one break in to get a cup of coffee.” This all combined with a grueling road schedule of carrying all of the booth materials and literature in a Winnebago that must be driven through the night to get to each venue on time to set up the booth and be ready for the next day’s concert attendees. Matt is confident that his 7,000 mile trek to 16 venues was all worth it because the feedback he received was invaluable to better understand who his customers are and what preferences they have on a product like this, “Every day we got 3,000 to 5,000 people to try it and give me feedback. Every time we showed people how to use it, and how to correctly focus a pair of binoculars I could look down the line and see a grin on each face because it was the first time they had seen a clear vision through a good pair of binoculars that focuses for both eyes.” Direct feedback led to improvement in the color schemes of the binoculars, opinions on the marketing tag lines that had been developed to promote the product, and ideas for where to promote the results of this tour, “People really responded to ‘Respect Individual Points of View’. The fact that we were at this tour gave all these pop magazines a reason to write about us when they would never have previously thought to write about binoculars before.”
This concert tour proved to be the ideal place for VU Points to display its product, and further engrain the attitude and brand identity of VU Points into consumers’ minds, “That’s the market I want. I want to take the tribal experience of going to concerts and adding some visual excitement to the aural experience. To help those who can’t see the stage get the visual into it. When they go to buy a pair, or when they open Rolling Stone and see them presented, they’ll remember seeing it a Lollapalooza, or the Extreme Games or the US opening of Surfing. It builds the culture of the brand.” There were also some valuable marketwide conclusions Matt was able to come to after visiting cities all over the country and speaking with the people that live in these regions, “I felt that all the demographic stuff I read was a bunch of B-S. There are few differentiations due to age such as baby boomers and X-generationers. The differences are rooted in regions of geography. There are some cultural elements that are rooted in each generation such as JFK, the Shuttle accident, the Dukes of Hazard and Bonanza. But I found that different regions strongly drive the differences. That’s why I market to a mind-set I call “Active-Stylers” (ie: fashion conscious, active evet enthusiasts) and not the demographic classes. It doesn’t matter if you’re 6 or 60, do you have the attitude? We encourage people to think outside of the traditional uses of binoculars and use VU Points as an accessory for their lifestyle whether it’s mountain biking, concert viewing or spying on neighbors.”