Marketing of your invention

Once the final prototype has been developed and the patent application filed, the real work begins. If you want to make money from your invention, you need to make it known to the public. There is only one way to achieve this, and that is through an effective marketing strategy. 

Marketing involves a set of measures and studies related to a product’s market penetration. It is not, as many believe, simply a matter of selling the product. The decisions made during a marketing campaign involve identifying the product’s target audience, defining its presentation and packaging, creating brochures, and designing advertising and a marketing strategy specifically tailored to that product. 

Before reaching this stage, the inventor must first decide what to do with their invention. They can sell it to a manufacturer for a lump-sum payment or license it in exchange for royalties, which are typically set as a percentage. The other option is to start their own company to manufacture and sell the invention to retailers. 

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Most inventors opt for the first option and license their invention to a company that will handle all the necessary steps, from production to distribution. Meanwhile, the inventor can focus on their next invention. The fact is, most inventors haven’t even finished with their first invention before they already have another idea in mind… 

At first glance, this solution seems the simplest and most profitable, on the surface. Because in reality, it’s not as easy as it seems to convince manufacturers. They generally know their customer base very well and understand what suits them. To successfully get an entrepreneur interested in your product, you must first study the market relevant to their field. But to do that, you need first-hand information that is sometimes hard to find. 

Inventarium can help you with this by creating a customized marketing plan for your invention. Conducting this study is a long and arduous process that requires specialized knowledge and access to certain research software, which, in most cases, isn’t available to everyone. In fact, it would likely be more expensive for you to subscribe to this specialized software than to have our specialist carry out the entire process. In my opinion, this plan is absolutely essential for any inventor who is even slightly serious about their endeavor. 

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The marketing plan is always preceded by a consultation with our marketing specialist. In line with our policy of doing everything possible to keep the cost of our services as low as possible, this consultation takes place over the phone to eliminate travel for both parties. The duration of this consultation is flexible, as our expert will take the time needed to answer all your questions. They will also provide you with information on the following topics: 

• The importance of clearly identifying your target customer
• How to add value to your invention
• How to define your product’s profile
• Whether or not it is necessary to build a prototype of your invention
• Pitfalls and unnecessary expenses to avoid
• Pre-production and its benefits
• The importance of your product’s packaging
• Marketing it yourself or selling the idea 
• What you need to know about the industry related to your product
• Preparing before approaching a company
• Royalties and accounting verification
• The types of companies to approach and those to avoid

He will also take this opportunity to discuss various aspects related to contract negotiation, marketing, advertising, and the sale of a new product. 

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Whether you choose to market your invention yourself or license it in exchange for royalties, gathering certain information is essential to achieving your goal. Our marketing specialist has therefore developed a marketing plan that perfectly meets your needs at this stage of your project’s development. 

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Their mandate is to provide answers to the following: 
• Defining the profile of the new product 
• Identifying the target customer 
• Identifying existing competing products 
• Identifying the leading companies in the field 
• Identifying companies to approach or avoid 
• Determining whether these companies are already working on a similar product 
• Their licensing policies (authorization to use)
• Internal and external barriers and influences affecting these companies
• How to approach these companies
• Analysis of the industry related to the invention’s field (culture, competition, etc.)
• Analysis of industry trends (figures) 
• Researching key data (product lifecycle, sales, etc.) 
• Identifying the best distribution channels related to this field 
• Whether or not to build a prototype for the presentation 
• Preparing a business solicitation letter in French and English 

  The marketing plan is divided into nine distinct sections: 
   - The Approach 
   - The Industry 
   - Trends 
   - The Product 
   - Events 
   - Distribution 
   - Solicitation Letter 
   - List of Companies

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The Approach:

There are many factors that come into play when launching a new product successfully. The goal of the marketing plan tailored to your invention is to provide you with the tools and information you need to succeed. Each section of this report is relevant to the success of your project. It is very important to fully understand the industry in which you will be competing. Every industry has its own way of doing business, calculating profits, selling to retailers, and complying with certain government regulations. 

Therefore, the first part of this report focuses on the industry related to your invention. The most relevant questions to answer are: Which companies in this sector might be interested in your new product? How should you approach them? What are the current trends in this industry? Are there any barriers I should be aware of before bringing my product to market? Are distribution channels easily accessible? 

The first sections of the report provide an overview of the industry. This overview helps you understand the customers in this sector—why they buy, how much they spend, their attitudes toward the product, and so on. Armed with this valuable information, you will be better positioned to make a suitable offer to businesses. The various sections of this marketing plan provide you with insights, suggestions, and information regarding the target customer, manufacturers, and retailers.

The Industry:

Every industry has its own rules, methods, and key players. Just like individuals, industries can be aggressive or conservative, with little room for change. That is why it is important to have at least a basic understanding of the industry’s philosophy before embarking on the process of marketing a new product. 

To help you gain a thorough understanding of your product’s market, this section provides information on products, sales, trends, and developments within the industry. You will also find comments, suggestions, and recommendations from our expert based on observations made throughout his research.

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Trends:

Trends in a given field are highly significant. They can either facilitate or hinder our efforts. A good example is the shift toward sustainability. Eco-friendly and organic products are currently in high demand. If you’re trying to market a product that goes against industry trends, you need a compelling reason to convince companies to get on board. On the other hand, if you can capitalize on a trend, your product will be easier to gain acceptance for and, ultimately, to sell to consumers. 

Example: The Quebec government’s decision to require all vehicles to be equipped with winter tires will be followed by the same requirement in Ontario. This is a trend that creates several business opportunities in this field: new services, increased tire sales, etc. Sometimes a product is neutral, meaning it does not benefit from any trend and does not reflect anything negative in the eyes of the consumer. 

In this section, our expert presents the results of his observations regarding industry trends related to your invention.
 

The Product:

A final product prototype is extremely useful. It allows you to see if the product is functional. Advertising, packaging, and costs can be calculated with precision. You can also use a prototype for advertising. Remember the story of my Gourd’O, for example. I managed to convince the buyer for the Quebec Winter Carnival to purchase a large quantity even though I only had a wooden prototype. Companies are often hesitant to move forward or buy into an idea if there is no prototype or if it isn’t functional. The main reason is that in 10% of cases, the product doesn’t work as intended and never will, so the idea must be abandoned. Entrepreneurs are familiar with this reality. With a functional prototype, credibility is no longer an issue or an obstacle. 

Before investing time and money in manufacturing the finished product, external obstacles must be examined. There may be regulations imposed by CSA, ISO, and ULC that require products to be tested to ensure their quality and consumer safety. Regardless of a product’s trends, strengths, or weaknesses, when it is introduced to the market, it is competition that determines its success or failure. First and foremost, competing products limit the potential of the new product.

Even if your product is excellent and superior to the competition’s, consumers won’t buy it if they already own a similar one. Where does yours fit in? If the competitor’s product is of good quality and has sold well, the market has been satisfied. If consumers are satisfied with that product, they won’t buy a similar one, no matter how attractive or valuable it is. On the other hand, if customers are dissatisfied, then the door is open to welcome a new product.

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Events:

Trade shows are the perfect place to gauge interest in a product. You have the opportunity to see what’s new and find out if a product similar to yours has just hit the market. Often, managers who are usually hard to reach are at trade shows to check out the latest offerings. 

You’ll also find associations or groups related to your industry, which are important sources of information. They regularly hold events, some of which may be directly related to your market.

The marketing plan therefore includes a list of trade shows, events, and associations related to your invention’s field.
 

Prospectus:

The marketing plan includes the preparation of a sample business prospectus in both French and English.

List of Manufacturers:

In this section, you will find a list and contact information for manufacturers and contacts related to your invention’s field, as well as the most significant and promising companies in that field.

Webpage for Your Invention:

To improve your chances of attracting companies or investors to your invention, our marketing specialist always recommends supporting your efforts with a customized webpage dedicated to your invention. Inventarium offers this service, including hosting your webpage on its server. 

You can choose between a webpage with photos only or one with photos and video. If you choose the webpage with photos and video, you must provide us with a short video clearly demonstrating how your invention works. A video without narration is ideal, as it can be easily understood by anyone who watches it. If you do not have a video, Inventarium offers this service at a very affordable price.
 

A Front-Line Tool:

Conducting this study requires consulting certain research software that is not available to the general public. But this work is necessary because, in my opinion, this study is an indispensable tool for gaining a thorough understanding of the field related to your invention. 

With your business plan and website in hand, you are ready to take the steps to find companies or investors who might be interested in your invention. First, you need to review the valuable information compiled in your business plan, examine each point individually, and delve deeper into them using the various search engines readily available on the Internet. 

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For example, if our specialist identifies one or more products that compete with yours, it is important to conduct a more thorough investigation of each of these products to clearly highlight the advantages of your invention over them. The same applies to the companies identified in the report; it is of the utmost importance to determine which ones deserve your attention. You can easily check their reputation, revenue, number of employees, the scope and size of their market, and so on. You can also check whether these companies are facing legal action. Here’s a quick tip on that: type their name into Google followed by the words “civil lawsuits,” “legal proceedings,” or “lawsuit,” depending on whether the company in question operates in a French-speaking or English-speaking market. 

The key to your success is having a thorough understanding of your invention’s field so that you can effectively target your actions and interventions and, above all, have the answers to any questions that might be asked during potential negotiations. 
 

If you decide to license your invention, here are a few tips for your future negotiations with large corporations. The financial aspect is rarely discussed at the outset of negotiations, which can drag on for quite some time before resulting in a favorable agreement—and this is for several reasons. In the eyes of multinational corporations, many details take precedence over money. 

The approach is a bit like a marriage. You never discuss the cost of the ceremony at the first meeting. If you do, chances are there will never be a second meeting. In business, you risk derailing a negotiation that could have yielded greater long-term benefits.
 

There are many details we want to know before setting the desired price, and the same goes for them. What you need to understand is that the development and marketing of a new product can involve several different departments. It can also affect the operations of many of their partners or divisions in the various regions of the world where these companies operate. Decisions are often made through committees. Also, in this environment, a very serious mistake can cost someone their career. Just think of the reformulated Coca-Cola, which, in just a few months, nearly caused the company to go bankrupt. The marketing director who had launched that idea had to find another job. 

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So, pay close attention, focus on listening rather than talking, and ask the right questions. You’ll gain a better understanding of their real needs, how you can help them, who they are, whether you can work with them, and—most importantly—how much they’re willing to pay, along with plenty of other information necessary for a successful partnership. Keep an open mind. When the time comes to talk about money, you’ll have enough information to make a fair offer for both sides. 

To return to the wedding analogy, the more time you take, the better you’ll know if you really want to get married, what kind of wedding you want, how much you’re willing to pay for the ceremony, and what kind of honeymoon you’d like to take together... The same applies to setting prices; this part is often the easiest if we’ve done the groundwork during the preliminary stages. But be receptive from the start. 

Avoid dogmatism, arrogance, and ultimatums. If you want a good relationship, both parties need to feel like they’ve gotten a good deal. This doesn’t mean you shouldn’t negotiate smartly, but there’s a difference between being smart and being arrogant. 
 

People who are logical and reasonable often strike good deals and rarely miss out on a good opportunity because of stubbornness. They enter into long-term agreements, and most of the time, highly profitable ones. The guideline is this: when you receive an offer, if you’re satisfied with it, regardless of what others say or think, that’s the deal for you. If you’re not happy, move on to another company because you’ll have to live with your decision for a long time. 

After sending your solicitation letters, if one or more companies are interested in your invention and you’d prefer to entrust the negotiation to a professional, our specialist can take on that role. As the author of your commercialization plan, they know your industry very well and, by that very fact, will be more effective than anyone else. 

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It goes without saying that if you can get more than one company interested in your product, your bargaining power will be greater. Keep in mind, however, that your decision shouldn’t necessarily be based on the highest bidder. The people who show the most enthusiasm for your product and those with whom you feel most comfortable are sometimes better than those who offer a lot of money. Signing a favorable contract requires patience and a careful analysis of what a potential partner is offering. So take your time to get to know the people you want to do business with. 

When the time comes to sell your invention, hire a lawyer specializing in commercial law. They will assist you in your negotiations and help you understand the implications of the contract terms being proposed. Our commercial law attorney can assist you in this regard. 
 

Despite some personal experiences that might lead me to believe otherwise, most businesspeople are honest and generally make reasonable offers. But business contracts are complex and often require clarification and fine-tuning. On top of that, legal language is so specialized that one can feel completely overwhelmed by these discussions. Don’t forget, either, that such a contract is likely to bring you substantial income for several years, which means it’s worth investing a little money to clarify the terms and secure a fair and unambiguous agreement. 

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Remember my misadventure with the businessman who was supposed to pay me royalties on the sale of Jog’O. The contract had been signed despite my lawyer’s advice, and it was only thanks to a clause I managed to wrangle out of him that I was able to extricate myself from that trap, even though the contract was still valid for two more years. Also keep in mind that a savvy and honest businessman will prefer to see you represented by a lawyer familiar with these matters. This way, things will move more quickly, and the protections granted to each party will be based on professional standards. Upon concluding such an agreement, you may be faced with a new choice. You may be offered a single, final payment for your invention. If you accept, you will transfer your invention and its production rights in exchange for a single check. If you own the patents for this product or have filed patent applications for it, these legal documents become the exclusive property of the buyer. If your invention becomes a major commercial success, you will have to be satisfied with what you received upon signing the contract. On the other hand, if this venture fails, you will not have to return the amount you received.

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Most inventors dislike this method of selling their invention, hoping it will achieve great commercial success and fearing they will be deprived of a much more substantial profit. That is why the royalty system is the preferred option. In such cases, both parties share the risk. If sales are strong, the manufacturer will make a profit and the inventor will receive a percentage of the selling price. The greater the success, the more the partners will earn. On the other hand, if the public shuns the product, the manufacturer will not make enough money to cover its costs, and the inventor will not earn enough to compensate for the time and money invested in the work. 

If you enter into such a negotiation, you should know that the royalties offered by companies generally range from 2% to 7%, unless several companies are competing with each other to obtain the production rights to your invention. If that is the case, let market forces play out and make your choice. Usually, this latter situation arises when you have taken the time to generate sufficient interest in your project among companies. It sometimes pays to be patient. It is therefore possible that one or more companies may decide to include a lump-sum payment in their royalty offer. 
 

Because there is usually a fairly long period of time between the signing of the contract and the start of production, the manufacturer may pay the inventor an advance on royalties. This advance means that you will not receive a single penny until the total amount of royalties due on the invention reaches the amount of this advance. For example, if you are granted $5,000 in royalties upon signing the contract, you will not receive any further payments until sales of your invention have generated more than $5,000 in royalties. However, if the venture fails, you will not have to repay this advance. Also note that there is no predetermined advance amount. During these negotiations, the inventor typically tries to secure the maximum amount, while the manufacturer tries to offer as little as possible...

Other contracts stipulating that the inventor receives royalties contain a clause requiring minimum performance from the manufacturer. The manufacturer, bound by contract, must pay a minimum amount of royalties each year, regardless of sales. This clause is advantageous because it compels the manufacturer to bring the product to market quickly and promote it effectively. 
 

After signing a royalty-based contract, the inventor is entitled to start dreaming of his product’s success. He may even see himself as a millionaire. In fact, it is precisely because they harbor this dream that most inventors choose to be paid through royalties rather than surrender all their rights to an invention. After all, they have put in months, sometimes years, of effort because they believed in their product. It is therefore only natural that they continue to believe in it once they have signed a contract... 

For those who have sold their entire invention and the rights attached to it, this sale can be sufficient incentive to embark on another invention. Many inventors have found fulfillment by working tirelessly on numerous projects, as was the case for me. Inevitably, over the years, many inventions become obsolete and need to be replaced by new products better suited to the demands of our fast-paced societies... 

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The best way to predict the future is to invent it... by starting your own company to produce and market your invention. But this is a highly ambitious project that will require significant amounts of money and energy, not to mention the need to quickly adapt to an environment with which the inventor is not always familiar. You will need to draw on your interpersonal skills as much as your technical, organizational, and business abilities to ensure your invention achieves the commercial success it deserves. 

If this is your decision, throughout the process, I advise you to listen carefully to what industry professionals tell you during your meetings. All the comments they make regarding how to manufacture your product, its design, packaging, or marketing are important. These people know what they’re talking about, and the insights they provide can prove invaluable for successfully bringing your product to market. They are all the more informed because they are surrounded by marketing specialists who tell them exactly what consumers are looking for. 

Every new business is typically launched with enthusiasm and optimism, but fewer than 25% of these commercial or industrial ventures survive their first year of operation. After two years, the number of businesses still in operation is even smaller. Fortunately, some succeed, and their companies eventually grow to a size that even seasoned businesspeople envy. Just think of my friend Paul Gallant, the inventor of 3D puzzles, whose products have gone global in no time at all. With motivation, perseverance, hard work, and money, this formula has a good chance of becoming a success.

I can attest to this myself, since that’s exactly what I did when I founded Hi-com Nouveautés with my partner Guy Cloutier to market several of my inventions. I don’t claim to have the magic formula for business success, although I believe I can outline the broad strokes of a business plan as I’ve come to develop it over the years. There are, in fact, excellent resources on the subject. 

Market research is a crucial step for anyone looking to launch a new product. It helps identify the target audience and pinpoint the factors that might influence their decision to choose one product over another. Market research also helps determine whether a product’s design resonates with consumers and what price they would be willing to pay for it. 

Always keep in mind that consumers have the final say. People are not willing to pay a penny more than what they consider a product to be worth. The price an inventor sets at the outset is generally the price consumers would be willing to pay. In industry jargon, this is called the “psychological price,” and you must stick to it. Personally, as you’ve seen throughout the previous chapters, once I had set my target price, reaching it became an obsession. 

It is also thanks to this type of survey that decisions can be made regarding the support needed to market a product. This is undoubtedly an essential phase, since it can determine the product’s future by gauging potential customer response in advance. Several firms specialize in such studies, but personally, I’ve always preferred to conduct these surveys myself at trade shows. 

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By analyzing your market research, you’ll be able to identify the advantages your product has over your competitors’. Once you’ve identified the factors that set you apart, promote them through flyers and make sure you have high-quality packaging, as this is a key factor in your product’s success or failure. It’s fascinating to see just how much of an impact attractive packaging can have on the public. Think about your own shopping habits. You often choose the product that’s best presented and packaged with the most care and originality.

Another method—though slightly more expensive—is to showcase your invention at one or more trade shows related to your field. Invention fairs are a fantastic showcase for a new product. You can use this platform to conduct market research and gauge public interest, as well as to get feedback from business professionals on your invention. There are also an increasing number of invention fairs, some of which enjoy an excellent reputation and attract thousands of visitors. Take advantage of this opportunity to get noticed! And if your invention wins an award at one of these exhibitions, you’ll ensure even greater visibility for it. 

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Next, you’ll need to determine where your product will be stored and how it will be delivered. Be sure to calculate the costs as well—this is very important. There are countless distribution options available. You might choose to distribute through a sales representative who will add the new product to their existing lineup. You can also partner with a distributor and handle part of the work yourself, or opt for direct sales via the Internet, direct mail, or even a catalog. It all depends on your goals and your target customer base. A careful analysis of each new product should provide you with good guidance on which distribution channel to choose. 

It is often said that in business, you must surround yourself with the most competent people if you want to succeed. This is true. My personal experience has taught me that it is pointless—and reckless—to try to handle every role yourself. Unless you are an accomplished manager, I recommend that you quickly find a partner, a right-hand person who will manage the company’s affairs and keep track of the money received and spent. You need to make the most realistic projection possible of anticipated operating expenses and set the selling price of your product so that you can maintain a reasonable profit margin. It may seem simple, but it’s much more complex than one might imagine.

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Next, develop a marketing plan with deadlines that you must strictly adhere to. At all times, you must personally oversee the smooth running of your business; above all, ensure that you maintain high morale. The success of your company depends on it.

Good luck!

- Daniel Paquette

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