It's hard to imagine a retailer that's actually growing in this tough market after reading BusinessWeek's update on the disappointing summer sales season. But for the retailers that are growing, guess how many of their new designs succeed in retail stores? You won't believe the answer. I asked 2000 entrepreneurs at the 2009 Economic Development Conference in Leon. Half guessed that about 50% of all products would fail! I said, wait a minute! You mean the most experienced and successful companies see half of their new products experiments fail?!

But if that estimate seems outrageous, the reality is even more staggering. Successful entrepreneurs see about 9 out of ten fail. The co-founder and CEO of Cuadra Boots, Hector Cuadra, validates that surprising statistic: "We have about one thousand samples a year, and only about 10% of those work." About 900 fail. For Cuadra, it's about how much of yourself goes into what you create. "One of the keys is to have your own personality in your product. Just to follow the others, it's to survive," he says. "Okay, it's a risk to create unique products, but it's a bigger danger not to!"

This is a key principle I learned as Chief Customer Experience Officer at Charles Schwab, and it was validated in our research for Success Built to Last at Stanford and Wharton: if your products aren't unique in your own personal and dangerous ways, your differentiation in the market may become only focused on price, leaving you with no sustainable, competitive advantage. "So I don't want to hold back any creativity from my team," Cuadra insists, "I want them to dream big dreams. Then we'll figure out what we can afford to create as sample experiments in stores."

Takeaways:

1. Don't just make a cheaper copy of what's in the market.

Get out with customers and see what works for them, but then always create your own unique solution -- something that reflects your brand's personality. For Cuadra, they decided to go with "the highest quality and fashion” then they make that high-end product for the cheapest in its product category rather than competing with Chinese pricing at the low end of the market. Like the popular Coach brand which caters to the 'affordable luxury' segment, Cuadra makes fashion, quality, and price all a priority.

2. If you're a manufacturer, consider getting some of your own retail stores.

Don't rely entirely on distributors and others to know what really works in the marketplace.

3.The 90/10 Rule.

While it's true that 90% of companies fail outright, even the best organizations see only 1 in ten products, services, and even customer relationships, succeed long term. As we discovered in Built to Last, the prequel to Success Built to Last, you've got to "try a lot of stuff and see what works." If your odds are 1 in ten, then the difference between being good and being great is that you have to have a Big Hairy Audacious Goal -- one big dream -- that's built on hundreds of little dreams. Then you can begin to experiment your way to the greatness you've envisioned.

Check out the video version of my trip to Cuadra on Facebook.