R&D, aka Research and Development, step two in determining whether your product will be a success or a flop. R&D consists of researching the consumer need, target audience, and product while developing your idea to accommodate these categories.

Typically, a company will spend an average of 3.5% of annual revenues on R&D, while a company that is to be considered high tech may spend closer to 7%.  Anything over 15% will push a company in to high risk, due to outrageous spending ratios.

One of the most successful trends in R&D is involving the outside community.  Many companies have come to realize that as the public becomes more advanced and has the ability to share networking opportunities, it is no longer a question as to should the ideas be shared but how can we attract the most innovative minds working together...and in our favor.


While this is one of the most successful modes in R&D, it is definitely nothing new. In 1927 when Charles Lindbergh became the first person to fly across the Atlantic Ocean he walked away with not only the glory of being the first to complete this task, but a $25,000 cash prize awarded by Raymond Orteig - a hotel owner who offered up the cash prize because he wanted to develop a system in which to accommodate his overseas guests. Orteig researched his target market then, used the cash prize to out source the development of the idea.

My biggest advice for any new businesses owner who doesn't quite have the budget for R&D (or the ability to come up with a huge cash prize) would be to follow 5 simple objectives, at least while in the beginning stages and until your research objectives gradually become more refined on their own.

1.    Get out there and talk to your audience.

By becoming a popular figure in the community you target, it will open the door for people to come to you asking for the exact product they want and how they want you to give it to them.
 
2.    Set up Google PPC campaigns

Setting up Google PPC campaigns is another great way to follow trends and research competition.

3.    Research relevant topics online

Typing relevant keywords into search engines such as Google, yahoo, or msn will also help to research competition and figure out what you can provide better.

4.    Subscribe to your industry’s & competition’s relevant RSS feeds & Google Alerts

Subscribing to Google Alerts and Google Reader (or your favorite RSS reader) allows you to stay up to date and current with your competition and industry’s updates and advantages.  A lot of these keywords can be found through your Search Engine and PPC campaign research

5.      Utilize innovative marketing campaigns.

Viral video and innovative online marketing concepts will help attract and entertain your audience while you have the chance to not only learn from them, but also acquire their friends.  Anthony has written an excellent blog on how to utilize online polls effectively, which can be found here > click here.

Following these steps will always keeping you on top of your industry’s marketing curve, even if you find out that it’s time to bail.


http://en.wikipedia.org/wiki/Research_and_development

http://www.entrepreneur.com/growyourbusiness/waystoinnovate/article165988.html

http://www.charleslindbergh.com/plane/orteig.asp