According to this entry in Wikipedia – A by-product is a secondary or incidental product deriving from a manufacturing process, a chemical reaction or a biochemical pathway, and is not the primary product or service being produced. A by-product can be useful and marketable, or it can be considered waste.
While the practice of creating products from a primary product’s waste (lanolin – from the cleaning of wool) is commonplace in manufacturing environments, I think there are some great opportunities for innovation through by-products lounging around in every business.
The key is to simply start leveraging everything you’re good at doing – even if it’s seemingly unrelated to your core business.
For example, if you’ve gotten very good at online marketing and social media use, why not set-up a series of workshops and teach your clients how to do the same? There are countless examples of businesses creating successful marketing or management systems and then turning them into products for their industry.
If you’re good at hiring super stars, good at lead conversion, good at technology, good at creating buzz, you probably have an opportunity to turn that skill into a by-product.
Some may think, “sure, I could create all these by-products, but wouldn’t that just divert my focus from our core products and services?” Maybe, but you may also find something that should be your core product. Jason Fried, co-founder of 37 Signals, tells a story about how his web design firm needed a project management tool so they created one for their own use. Clients liked it so much they started offering the tool to others and before they knew what hit them, they had created Basecamp and altered the direction of their business forever.
Another great reason to start mining your business for by-products is that it’s a great way to up your expert status. Even if your by-product doesn’t ever offer long-term revenue and profit possibilities, there’s a good chance you can leverage it to get more exposure. By taking a leadership role in teaching your clients or an entire industry how to do something well, you’ll open up opportunities for media exposure, industry event speaking, access to suppliers, and in all likelihood, the ability to charge more than your competitors for your core offerings.
This notion is so powerful it should be part of your marketing plan and Marketing HourglassTM