Features - October/November 2006

The Big Idea

Turning an inspiration into lasting success

by Emily McMackin

Do you dream of coming up with one idea (or several) that would change your life and your business forever? One ingenious idea opens up a wealth of opportunity, but it takes focus, vision and flexibility to make the most of your big break. Meet entrepreneurs who have a knack for taking one big idea and turning it into long-term success.

If you can hum the tune "Chi-chi-chi Chia" or know the ditty to "Clap on, clap off," you have Joe Pedott to thank. Without him, the Chia Pet (a clay figurine that sprouts a coat of herbs), the Clapper (a gadget activated by hand clapping that turns appliances on and off) and other wacky contraptions would have never become such a pervasive part of American pop culture.

Though Pedott didn't invent the products, as many Internet sites claim, he took the obscure items, which were struggling on the shelves, and, through catchy commercials, transformed them into must-have merchandise for consumers in the '70s and '80s. Since then, he has pulled off similar feats with other off-the-wall products, from the Chimney Sweeping Log (a log that cleans the fireplace as it burns) to the Ove Glove (a fire- and heat-resistant potholder that can withstand extremely high temperatures). And at his San Francisco-based business, Joseph Enterprises, Pedott, like a Hollywood agent, is still on the lookout for more up-and-coming inventions with star qualities and patent potential.

"It's fun to create wonders," Pedott says. "It's like painting your own Picasso or climbing your own Mount Everest."

Describing his business as a "one-stop shopping center" for inventors who have product ideas that they aspire to take nationally or internationally, Pedott not only helps develop and market the products, but he also handles the warehousing, shipping and billing and arranges for direct distribution to retailers. He even provides funding to people with promising ideas but no money to develop them.

Ironically, his most successful product--the Chia Pet--came from his failure to snag an advertising account. Pedott couldn't land the Chia Pet's former manufacturer as a client, but he firmly believed in the product and offered to buy the patent. Though the Chia Pet sold well in stores, its high expenses drained profits, Pedott recalls.

"We felt like we could develop the product with better marketing, decrease costs and increase the potential profit--and we were right."

Drawing on his experience making live television commercials--a venture that put him through college in the late '40s and early '50s--Pedott created consumer demand for the Chia Pet, lowered its price and guaranteed its sale to retailers by allowing stores to send back their leftover boxes.

As the Chia Pet grew in popularity, Pedott sought more fledgling products with mass-market appeal, while inventors brought their creations to Joseph Enterprises, hoping to catch some of its magic.

Though not every product Pedott has taken on has been a winner, he has found consistent success by seeking quirky yet quality merchandise that he can sell at a reasonable price and promote with broad advertising and distribution. If a contraption costs too much to manufacture or promote, though, he is quick to cast it off. And as advertising has become more Internet-based, he has moved his commercials to Web sites set up for his products. Most importantly, Pedott knows how to keep his fads from fading. This holiday season, he will test-market a plush Chia Pet doll that plays the "Chi-chi-chi Chia" theme song.

"If you do something repetitive, you're doing a little brainwashing," Pedott says.

Netting a new market Andrew Field, owner of Livingston, Mont.-based Printing For Less, has received a handshake and congratulations from President George W. Bush for his entrepreneurial skill. As founder of the first virtual print shop, he has been featured in several national publications. Organizations from the U.S. Small Business Administration to printing associations around the country have recognized Field as an innovator and pioneer.

But talk to Field about his business, and you would think that he had just launched it. He discusses its details with the enthusiasm of a rookie and is as passionate as ever about its potential. He spends more time talking about how to grow his company than touting its successes.

"Less than 1 percent of commercial printing is bought via e-commerce," Field says. "We have a long way to go, but hopefully the boon is about to begin."

That's an ambitious goal for an entrepreneur who already has a corner on the e-commerce printing market that he created. Though the Web now teems with hundreds of start-ups that have tried to cash in on Field's concept, Printing For Less continues to dominate the field, drawing $20 million a year in revenue and selling more business-to-business printing online than any commercial printer in the country. The business, which now has more than 150 employees, has twice made the list of fastest-growing printing companies in the nation. As printing becomes more of an Internet commodity, Field keeps his company distinctive by focusing on serving customers.

"A lot of people will try to sell you a postcard or brochure on the Internet, but nobody else provides the experience we do from beginning to end," Field says.

A customer complaint sparked his idea to sell printing online. One day, a small-business owner stopped by Field's local print shop frustrated because he couldn't find anyone to print a four-color, fly-fishing catalog from a file he'd created in Microsoft Publisher. After tinkering with his presses to find a way to make it work, Field figured others faced similar hassles and sensed an opportunity.

"At the time, there was nowhere you could take digital files created in Microsoft or other non-traditional formats and buy prints of them with your credit card--the way you could buy a CD or book from Amazon.com," he says.

So Field set up the first Web site and proprietary workflow system that allowed customers to send layout files in nearly any software format, specify quantity, size, paper and foldings with an instant interactive pricing tool and receive high-quality prints at their doorstep. Overnight, his business morphed from a local outfit with a break-even bottom line into the first printing shop in the nation with a borderless market. The idea caught fire, luring dozens of new customers each day from New York City to the rural West. At first, the company sold only brochures, but as demand for more products grew, it expanded its offerings to encompass everything from bookmarks to door hangers. Field was intentional about the growth.

"Instead of branching out into a lot of different things, we stayed focused on being the best we could be," he says.

That meant eliminating inefficiencies. As the staff expanded from 15 employees to 50, customers complained about getting shifted from person to person to get their questions answered. Field paid attention to the problems--and the company took a step back to determine how to move forward. Business doubled once Printing For Less redesigned its processes and began training employees to serve on three-person technical service representative teams equipped to handle questions about everything from credit-card processing to print production and to work hands-on with customers' projects.

Through the highs and lows, Field has never stopped putting profits back into his business--investing in training to keep employees knowledgeable and maintenance to keep equipment top-notch. The company recently moved its offices from an old creamery to a state-of-the-art facility and added mailing service--at the urging of customers. And e-commerce now accounts for 99 percent of its sales.

Field traces his company's success to experimenting with ideas, hiring great leaders, listening to the occasional complaint and staying true to its primary customer base—small-business owners who want a fast, low-cost way to publicize their businesses.

"A lot of entrepreneurs are so bright and creative that once something is up and running, they get distracted and go onto the next thing," Field says. "But before you make a big bet, you have to make small ones--and see how they turn out."

Playing to Win Roger Shiffman was living the dream of most entrepreneurs. After 20 years of making popular handheld electronic games and creating interactive toys that became smash hits like Furbies, Poo-Chis, Talkboy and Giga Pets, Shiffman and his partner sold their business, Tiger Electronics, to Hasbro for $335 million, and Shiffman settled into a life of golf games and cruises. But as he watched independent toy companies fold and longtime toy makers consolidate, leaving the market in the hands of a few corporate giants, Shiffman got restless.

It wasn't long before he started hearing from former employees who, despite their fancy corporate jobs, missed the magic of Tiger's entrepreneurial environment. "As successful as they were in their new jobs, it wasn't the same as what we had," Shiffman says.

Retailers with whom Shiffman had worked in the past were also frustrated by the lack of originality in the toy market and longed for some fresh ideas. All signs pointed to a comeback, so Shiffman kissed his retirement good-bye and started a new, small toy company, Chicago-based Zizzle, from scratch. The homecoming was welcoming.

"There is a tremendous assortment of outside inventors with whom we work closely--and they are happy to have a new home to bring things to," Shiffman says. "With all the consolidations, fewer and fewer companies were willing to look at their inventions."

Though Shiffman has many more connections and much more clout this time around than he did when he co-founded Tiger Electronics in 1978, his reasons for starting the business and his hopes for its future are much the same.

"Our vision is to come in and try to do things that we believe in," Shiffman says. "We don't feel like we have to achieve a certain dollar amount."

Zizzle has already snagged a master toy license from Disney to make exclusive action figures, playsets, role-play products, handheld video games and a pinball machine based on its recent movie, "Pirates of the Caribbean: Dead Man's Chest." The business is also stocking shelves with its own novelties. Last summer, it launched its first innovation, iZ, a metallic, alien-like DJ character that plays catchy beats and rhythms when you poke his belly or twist his ears. iZ even comes with a jack so iPod tunes can be plugged into the toy--a feature that Shiffman hopes will make the product even more attractive to young consumers.

"Things change so rapidly," Shiffman says. "The sophistication of youth is so much higher than it ever was before. It is urgent for us to be in touch with it and to recognize things that kids are doing like instant messaging and listening to iPods."

Timing is everything as Shiffman learned in the early years of his first start-up company. Kids--and their parents--weren't as crazy about electronic toys then, and the industry was hesitant to embrace them. But as Hollywood released more blockbuster movies and television series, studios started shopping for companies that could make promotional products.

Tiger's first massive hit came from Talkboy, a variable speed, recordable cassette/microphone toy featured in "Home Alone 2." The exposure from that made the Tiger brand a household name and opened the doors to success after success.

"We had the right product at the right time, and we were able to sell it for a lower price because we had less overhead," Shiffman says. "Plus, we had great ideas for more products. Everywhere we went it seemed like we could sell anything."

Other toy companies Tiger's size experienced similar windfalls, but couldn't hang onto their success. Shiffman kept his company on top by relying on his instincts more than market research or focus groups and operating on the philosophy that "just because you get one thing right doesn't mean you get everything right."

"You have to continue to be aware of the market and stay a half-step ahead of the changes, if you can," he says. "There are few products that you can sell forever as is."

Shiffman hopes to make Zizzle a big player in the toy market, but that doesn't necessarily mean expanding. He believes Zizzle's small size as a 30-employee company will keep it flexible and better able to seize good ideas that come along. Though partnering with television networks and fast-food restaurants to capitalize on iZ's release figures into his strategy, his secret to getting others to embrace his ideas is much simpler.

"You have to believe in the service or product you're providing-- and know the reason why you fit into the business, and why people should work with and buy from you," he says.

Success Everlasting
Five ways to capture lasting success from one great idea

1. Pay attention The best ideas come from listening closely to customers, clients and consumers and looking for creative ways to meet their needs, solve their problems or satisfy their wishes. Even complaints can inspire innovative concepts that can transform your business.
2. Make it worthwhile Once you come up with a great idea, make sure it will work--and that it will sell. Give customers the best value possible. Offer your product or service at a price that everyone, including you, will benefit from.
3. Promote with purpose Understand the reason for your idea and how it fits into your business or industry. Know why others should partner with you and buy from you, then communicate that with enthusiasm. Invest in advertising that will grab your target audience and show them the benefit of buying from you.
4. Stay the course Once you have come up with a brilliant idea that has taken off, your biggest job is to stay focused. Sure, you have lots more great ideas that could take the marketplace by storm, but it's easy to get distracted and spread yourself too thin, especially if your resources are limited. Concentrate on building up the venture at hand before adding more.
5. Practice humility Just because you have one hit doesn't mean that others will follow. To stay on top, you must stay in touch with consumers and your market and roll with the changes. If an idea falls flat or is no longer working, let it go. And if your product is a smash hit, use the profits rolling in to reinvest in your business instead of going on a shopping spree.

Web Extras
Next time you glance at the clock on your microwave, think about James Fergason, the inventor of liquid crystal displays. Learn how he turned his idea into a huge business success in the "Web Extras" section of www.NFIB.com/toolsandtips.