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Inder Singh, Founder and CEO of Kinsa, presented at November 2014's edition of Hardwired NYC. Kinsa is a connected smart thermometer that maps real-time human illness.
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Hardwired Meetup, Nov 11, 2014
Inder Singh, Founder & CEO, Kinsa
[email protected] @inderstweet @kinsa
The Kinsa
Smart
Thermometer A smartphone-connected
thermometer
(with optional extension
cord)
Our vision:A world with instantaneous communication &
sensing
You've got a great product, now you want to sell it and get it to the masses…
Where, how, when? Do I work with retailers or sell online? What challenges should I expect?
First, the scary part…
• 90%+ product launches fail• Typical retailers take big margins: 35-50% of the price
US Retail is HARD!
• Lots of hidden costs/ effort: retailers, distributors, brokers, “market development funds”• E.g., If you make an error shipping, retailers charge you!
• Limited data on sales (unless you pay)• Expect stone ages when it comes to their technology• They don't want to sign anything• They have full right of return (with penalties)• They pay a long time after you send them product
US Retailer Payments
time
materials for manufacturing
manufacturing, packaging
warehousing & fulfillment shipping
to retailer
Retailer pays you
Startups typically don’t get paid upon receipt, but rather when the end customer buys the product
So why sell in retail?
• Distribute LOTS of products• Build a well known consumer brand
Where should I sell my product?
Where do/will people naturally look for my product?
Important: Where you sell will impact your product requirements & company infrastructure!
Overview of retailers (simplified)
Amazon Typical Retailer(Bricks & Mortar)
Apple
Margins ~27.5% 35-50% 50%
Ease of Entry Easy Varies (generally hard)
Varies
Frequency of newproducts added
Anytime 1 – 5 times per year
Every month
Other costs minimal Brokers fee’s,shipping
penalties, data, MDF
Distributor fees, high end
packaging
Tips and Takeaways (1 of 2)
Some Hacks• Go international early to get pre-payment + marketing support! • Go to Apple first and tell everyone Apple has stocked it. • Test in the “fake stores” some retailers have. Totally worth the cost.
Ask about it up front. Otherwise go test at a mom & pop store.• Create different skus from day 1 to test pricing.
Rule of thumb: Wholesale price should be at least 4X your COGS, ideally 6X especially if you have significant customer support costs.
Tips and Takeaways (2 of 2)
Other thoughts: • Start on packaging early. This is hard to get right. Retailer want to see it
up front.• Get merchandising equation right vs. go big fast… decide on a strategy
and commit. The latter is way riskier, but also pays way bigger rewards.• Selling in is easy for very novel products. Selling through is very hard. See
point above about the merchandising equation.
Merchandising is a very imperfect science. Iteration is expensive and extremely time consuming… e.g., each change to packaging requires design, development, and manufacturing resources, and also significant relationship management effort to convince retailers to allow you to iterate it.
Appendix
Impact on society
Flu • Infects 1 in 5 globally each year
• Has killed more than all of history’s wars combined
SARS in 2002-2003 • Spread to 20+ countries within weeks
• Killed thousands with a 10% fatality
• Cost tens of billions in economic loss
Swine Flu in 2009• Global infection rate of 11-21%
• Killed 300,000 but less virulent than expected (expectation was
same level as 1918 Spanish flu, infecting ~27% globally, killing
1 in 6 )
In both cases: • Quarantines were issued, but these were far too late
• Fundamentally missing: real-time, geo-located data
Sensors provide early detection / early response
opportunities
An entry point to the
just-fallen-ill…
“What illness does
he have?”
“What’s going
around at his
school?”
“What should I do?”
…unlocking value for the individual…
Track Symptoms Find local care See what’s going
around
Get your illness
outlookMake it FUN
…enabling instantaneous communication and
data acquisition…
Symptom Treatment
seeking behavior
Relationships:
people to people,
people to locations
Illness/
diagnosis
Real-time,
geo-located
data on:
…and creating value for the community
• What is going around?
• How do I avoid getting it?
The health system also
benefits…• Where is flu spreading?
• Is there an epidemic?
• Where do I direct my $$ to save
the most lives?
