What Is The Problem? What Are The Options? What Is Your Solu

What is the problem? What are the options? What is your solution?

In the scenario involving Ian McKenzie’s development of a mobility aid device, the core problem is determining the market potential and the most effective approach to assess the commercial viability of the "Handybar." McKenzie has created a device designed to assist individuals, especially those with mobility challenges or injuries, in exiting smaller cars more safely and easily. The challenge lies in deciding how to evaluate the demand and sales potential for his invention effectively and efficiently, while managing costs and risks associated with market research and financing.

There are three main options available to McKenzie: conducting a telephone survey in the Vancouver area, relying on optimistic business forecasts without primary market research, or conducting interviews with retail outlets that serve mobility-impaired consumers. Each option has distinct advantages and disadvantages concerning costs, reliability, and potential insights.

The first option, conducting a telephone survey costing $25,000, provides targeted, localized insights into potential customer interest within a definable geographic and demographic market. Such primary research could yield more accurate demand estimates, helping minimize risks associated with overestimating market size. However, the high costs and limited geographic scope could restrict the comprehensiveness of the data, and there’s no guarantee the surveyed individuals would represent the broader North American market.

The second approach—relying solely on optimistic projections based on market size estimates and sale forecasts—significantly reduces research costs but introduces substantial uncertainty. The assumption that everyone buying a new car would be interested is overly simplistic and not grounded in empirical data. Without rigorous market validation, this method risks overestimating sales potential, leading to poor investment decisions and financial losses.

Third, interviewing retail outlets that serve individuals with mobility issues involves a $10,000 investment to survey 25 outlets. This method offers a middle ground, providing industry-specific insights and demand forecasts from experienced distributors and retailers. While not as localized as a Vancouver-only survey, this approach could better reflect market acceptance and practical sales channels, reducing the risk of overestimation and providing valuable customer feedback.

Given the circumstances, a balanced solution would involve a combination of these methods, starting with targeted industry interviews to gather qualitative insights and validate assumptions. If preliminary findings suggest strong demand, McKenzie could justify investing the $25,000 in a more extensive survey in key markets or broader regions. This phased approach allows for risk mitigation, incremental investment, and data-driven decision-making, consistent with entrepreneurial best practices and strategic marketing principles (Kotler & Keller, 2016).

Furthermore, considering McKenzie’s confidence in securing financing through personal relationships, it is prudent to conduct the initial market interviews to strengthen his business case. This approach aligns with research indicating that primary research, especially market interviews, provides crucial insights and reduces investment risks (Malhotra & Birks, 2017). Although the upfront costs are significant, investing in accurate market data can save costs and prevent failure down the line.

In conclusion, the optimal solution involves conducting targeted interviews with retail outlets serving mobility-impaired consumers to gather preliminary demand data. If results are promising, McKenzie should proceed with broader, more comprehensive surveys. This strategy balances cost, risk, and information quality, enabling informed decision-making and increasing the likelihood of successful product commercialization.

References

• Kotler, P., & Keller, K. L. (2016). Marketing Management (15th ed.). Pearson.
• Malhotra, N. K., & Birks, D. F. (2017). Marketing Research: An Applied Approach (5th ed.). Pearson.
• Farris, P. W., et al. (2010). Marketing metrics: The definitive guide to measuring marketing success. Pearson Education.
• Myers, M. D. (2013). Qualitative research in business & management. SAGE Publications.
• Gartner, W. B. (1988). Who is a founder? Is the wrong question. Journal of Business Venturing, 3(3), 241–262.
• Armstrong, G., & Kotler, P. (2015). Principles of Marketing (16th ed.). Pearson.
• Roussel, P. A., & Drouin, N. (2003). Strategic Marketing Planning. Routledge.
• Weinstein, A., & Adler, D. (2014). Market segmentation: A step-by-step approach. Routledge.
• Day, G. S. (2011). Closing the marketing capabilities gap. Journal of Marketing, 75(4), 183–185.
• Hunt, S. D. (2008). Foundations of Marketing Theory. Routledge.