Crossing The Chasm – Lesson#1 – Marketing In The Early Days

Where Do We Start??

Initial Assumptions:

  1. I’m going to assume you have a business concept, a strategy, some funding (bootstrapped or otherwise) and a product in some stage of development.  You may have some customers or you may be looking for your first but you are fairly early on in your company’s life but perhaps beyond pure start-up.

  2. I am writing from a B2B perspective but most of this is applicable to all businesses.

  3. While Crossing The Chasm ("CTC") focuses mostly on marketing and selling I will touch on product planning and development as well.

  4. Lastly, I will assume you have read the book and are familiar with the concepts without reviewing and reiterating the great teachings in the book.

Given you can see as clear as day how you are able to solve some of businesses biggest problems and help them save or generate huge amounts of dollars it is only fair to assume that someone closer to that business (the customer) will see your solution as the answer to all their prayers, right?  WRONG. 

Education is one of the single biggest portions of  a sales cycle in the early days.  In most cases you are trying to sell them something that they don’t even recognize that they need yet.  I know in my situation we spent countless hours and dollars trying to educate prospects on the basic NEED for what we do.  We also spent untold amounts trying to build awareness and lead generation marketing campaigns through the years.  In hindsight I would have ENTIRELY cut out these programs.  Money is tight and intuitively you think getting your message out to the masses will build brand awareness and will mass educate the market on your fantastic approach to solving their problems.

RECOMMENDATION #1 – DON’T SPEND WASTE MONEY ON MARKETING PROGRAMS IN THE EARLY DAYS

If I had to do it again (and by that I mean, the next time I do this) I would spend all those efforts on tracking and speaking to established bleeding edge early adopters within the target verticals/customers that have the most strategic value to me as a reference.  Finding bleeding edge early adopters should be the single focus of marketing efforts.   I want to be clear that when I say target early adopters I am talking about PEOPLE NOT COMPANIESPeople lead the early adoption of new technology.  Yes Corporate culture and willingness to take on these types of projects is important but in my experience, even in a let’s say less than progressive industry or company, you can and MUST find people who are visionaries and those are the people you need to market and sell to.  Seems pretty logical but tactically how do you execute against this?  Here’s my lesson’s learned for your consideration:

  1. Regardless of the type of solution you are offering and the functional area of the organization your solution is applicable to it is usually easier to find someone in the IT group than on the business side simply because of their background.  This person will be your sponsor, your advocate and it is important that in the early days you really view them as a Partner more than a Client.  Many of these people can be found using bleeding edge technologies as that is their disposition, so social media tools, SXSW type events is where they will be hanging out to try to get info about the newest and shiniest things happening in their world.
  2. Look for companies that have already crossed the chasm selling into the general space you are in and reach out to them.  They will have lessons learned that will be as and more valuable than what I am telling you here.  The most important thing they will have is the name of PEOPLE that they dealt with at the companies they sold into.  Early adopters typically don’t change, even when unsuccessful.  Finding a person inside a target company that sponsored/led/bought another visionary offering was critical to our success.  This is the person you need to contact, court, and convince that you can help them.  They will understand more than anyone else the problem you are solving and the evolutionary way in which you are going about solving it.
  3. As you look into your target industry for ideal strategic candidates, in my experience the ones who are most likely to be open to your message as Company’s are the ones who are in the Top 20% of the industry and the ones who are in the bottom 20% of the industry.  The top 20% are there for a reason and have a couple things that are very important to you as you look to sell/partner with someone.  First, they probably have access to cash more readily than weaker companies in the space and second they also have an interest in staying ahead of everyone in their space and are willing to invest in new technologies that will continue to push their performance and create further distance between them and the middle class in the industry.  Bleeding edge people are attracted to these types of companies and are given more flexibility to thrive in this type of an environment.  Companies in the bottom 20% come at it from the opposite end but are viable for a different reason.  Finding a bleeding edge person is harder (but not impossible) in these companies but the culture of the company is more open to leading edge change because in many cases they have fallen so far behind the industry leaders they know that they need some game changers to get back in the game and in a lot of cases they have tried all the “non-evolutionary” solutions available to them with little or no effect.  Both of these are good customers for different reasons which I will get into in another post when I talk about “Sales In The Early Days”.  The middle performing companies are much harder to get into when Crossing because the risk of them investing in something new and having it fail from a personal perspective is very high.  The company is performing OK and often the culture of (the risk of) failure in a mediocre company does not support individuals stepping out and taking risks where in successful companies this risk taking and failure potential is accepted and frankly expected!

SUMMARY-KEY LESSONS

  • DON’T SPEND PRECIOUS FUNDS ON MARKETING INITIATIVES
  • KEY IS FINDING EARLY ADOPTERS…PEOPLE NOT COMPANIES
  • FIND PEOPLE WITH A PROVEN HISTORY OF SPONSORING LEADING EDGE INITIATIVES
  • RESEARCH OTHER TECHNOLOGIES THAT HAVE BEEN ADOPTED IN YOUR TARGET BUSINESSES AND FIND OUT WHO SPONSORED
  • FISH WHERE THE FISH ARE…USE CUTTING EDGE TECH/MEDIA TO FIND CUTTING EDGE PROSPECTS
  • OFTEN EASIER TO LOCATE IN ‘IT DEPARTMENT’ THAN IN THE BUSINESS
  • TARGET COMPANIES THAT ARE TOP OF CLASS LEADERS AND BOTTOM OF CLASS LAGGARDS IN THEIR INDUSTRY

Agree, Disagree, please share your experiences.

Crossing the Chasm – The "Lessons Learned" Series

For starters, if you have not yet read “Crossing the Chasm” by Geoffrey Moore please beg, borrow, steal or buy (link attached) a copy and read through it. This book is one (of the two) most influential books that I have read in my time in small technologies companies.
Crossing the Chasm is a book about the journey, the trials and the tribulations in taking your product and company from one where every sale is a missionary sale to a place where there is a broader market acceptance of what you do and the business need to solve the problem that your product solves. The transition from one side to the other requires different approaches to almost everything you do as a business. In this series of posts I will walk through each of the functional areas in a business and the external influences on each and from my experience what worked and what did not work. For most businesses despite the brilliant guidance provided by Geoffrey Moore, this trip is one riddled with trial and error. Like anything not everything will work for everyone but in this series of posts I’d like to provide what I learned and where I failed in and effort to assist others in completing a journey that many (some may say most) companies never actually complete.
Follow along as I hope I am able to provide you with insight and the ability to avoid the 1 misstep that prevents you from Crossing. If you agree, disagree, have additional stories, thoughts please add in the comments so others who read can learn from all of us as much as possible.
Let the journey begin…if there are specific areas, topics you want me to cover please let me know. Hope you enjoy.

Seek Out The Truth…

As you engage with your community and especially your customers, prospects and trusted advisors ALWAYS seek, ask for and encourage the truth. Too often people meet with others in their industry and have drinks and chat over how great everything is going and how wonderful their respective companies are. It is nice to meet with friends and exchange pleasantries but DO NOT mistake these meetings for confirmation that you are doing the right things. If you want to get better YOU MUST seek out the truth.

Here is what I believe…

If you are not getting better every day you are getting worse. There is no such thing as standing still.

In order to improve your business you need to understand your strengths yes but you also must understand your weaknesses either real or perceived. If you are not meeting the needs of your community and fulfilling your deliverables than someone else will. Engage in REAL conversations with people who are friends and foes. Here are some of the people you should seek out:

  • customers
  • employees
  • industry experts
  • competitors
  • business partners
  • lost customers
  • customers on deals you lost

Some of the questions to ask and data to acquire about your company:

  • Did you end up purchasing a solution to assist with your business needs ?
    • if so who and why
    • if not, would you consider doing business with us in the future, why or why not
  • How would you describe your experience in dealing with us
  • What could we have done differently in the sales process
  • Were there aspects of our product/solution functionality that did not meet your needs
  • Were there aspects of our implementation/methodology that caused you concern
  • Was our pricing competitive
  • Was our sales representative professional and effective at addressing your questions
  • What is your perception of our Company
  • How would you describe us versus our competitors

It is important that you talk to many different people and get many different viewpoints. What you are looking for is a pattern that comes across from several non-related sources that become themes. It is this data that you need to assess and evaluate as you look to steer your business forward and become the better tomorrow than you are today!

Don’t let people tell you what they think you want to here DEMAND the truth. Good luck and let me know how it goes.

I’ll Take Anger over Apathy

I had the good fortune of having a call with a somewhat angry customer today.  Yes….good fortune.  As I start to reach out to customers in my new role I am hoping to get one of two reactions:

  1. I love your software and have received countless benefits and value through it’s implementation and use.
  2. Your product is killing me!

If customers are not loving your product and pushing you to make it better or screaming at you because it is not working properly that means they have given up and are apathetic about you and your product.  As long as your customers still have emotion, engage with them and get to Know Your Customer

While it is always good to get positive feedback from your customers and delivering value some of the best feedback comes from struggling customers.  These customers can provide you with key actionable inputs and feedback that can help drive further value for happy customers and turn around unhappy ones.

As you meet with more and more customers you start to pick up data points that form trends.  These trends then can then drive product strategy decisions.

Go to your customers and look for the unhappy ones as much or more than your happy ones and drill into there problem and struggles with your product.  Often a turned around customer will be a more engaged, passionate customer than one who was happy to start with

Let me know how it goes for you and make sure you take the angry phone calls before apathy sets in.

Know Thy Customer

Seems like a pretty common sense piece of advice…and it is, BUT DO YOU?

In the upcoming months I need to spend time on the road going out and meeting with customers and prospects to ensure I have an accurate perspective on how ‘they’ see our product. It is very easy to get caught up in the act of navel gazing and convincing yourself everything is alright. It is also easy to carefully and conservatively maneuver through the difficult end of this year and 2009 convincing yourself that sales are down due to the poor economy and you would be right….in part. If your value proposition is compelling and provable aren’t troubled economic times the best time to help your customers with their business problems?

A few rules for getting to know your customers:

  1. Be generous with your customers – make the conversation about them not you. Find out what their biggest pain points are and see if there are ways you can assist them. If their biggest problem is NOT one you can solve, help them anyway. Connect them to a business partner with expertise, or a peer from another company who has successfully fought and won the same battle.
  2. Research and prepare - take the time to print out articles on their company and industry and read them ahead of the meeting. Understand the macroeconomics of their industry and vertical to build their trust and confidence that you are a knowledgeable and trusted advisor.
  3. Remember your Mother – I remember my mom telling me that I was given two ears and one mouth for a reason and they should be used in that proportion. Remember, you are there to learn! Learn what business problems are occurring at your customer and in his industry. Learn what they like and more importantly DO NOT like about your product. Learn how YOU can help THEM. In order to achieve the goals of the meeting remember to listen twice as much as you talk.
  4. Follow Up – Drop your customer a note when you return to the office that follows up on the meeting and thanks them for their time and interest in discussing their problems with you. Follow up with them on the commitments you made at your meeting whether that be a proposal, a contact’s phone number you promised them, copies of materials they requested.

This process puts you in a position where once a month or quarter you can call your customer check in and see how they are doing. They may not need your services this trip but if you help them with their business problems whatever they are…your time will come. In the mean time you walk away with valuable information on how your product is used, perceived, the value it is driving and the problems customers are having with it. All in all a pretty worth while trip for both party’s.

Let me know how this works for you or if you have a different approach

Weekend Thoughts, Reads and the Last Lecture

Some of my Favorites and Musings from the week, hope you enjoy…..
1. On Friday we learned of the passing of Randy Pausch the famed computer science prof and all around great guy from Carnegie Mellon after a battle with Pancreatic Cancer at the young age of 48. His legendary “Last Lecture” is lengthy but always worth the time as the lessons are invaluable…..and very moving.
2. A quote from Michael Jordan (while the souce is questionable, the message is not)
I have missed more than 9,000 shots in my career. I have lost almost 300 games. On 26 occassions I have been entrusted to take the game winning shot….and I missed! I have failed over and over and over again in my life and that is precisely why I succeed.
Obviously, it is not important to just fail, it is important to fail and learn from those failures so that you do not make the same mistakes again. You may make new ones but not the same ones. In that vein there is a great Post Mortem on Monitor 110 that we should all read and use as a reminder to be honest with ourselves and analyze our failures so that we may learn from where we have been.
3. Almost every week you could pick numerous of Seth Godin’s posts. I am a fan of Chris Anderson and The Long Tail. Seth has a post this week about the Profit in the Tail. If for some reason you have not read The Long Tail….grab it and read it (at least the article) this weekend.
4. Lastly, in support of my Delighting the Customer theme I provide a link to the Six Laws of Customer Experience. Have a read and I hope the theme of focusing on the customer experience is one that you will remember, maybe try some of my suggestions and by doing so you create not just good customer but good advocates, spokespeople and marketers for your growing business.

Hiring Engaged Employees

My last few posts have presented my thoughts on the critical need to delight your customers at all times and have discussed some of the how’s around that from the perspective of the types of roles you will require and some recommendations around the types of action plans you can implement. There is one major requirement for the execution of the plan and the consistent delivery of a WOW customer experience and that is PEOPLE.
It is imperative that the people building your product, the people hiring, the people interacting with customers, the people in your company are passionate about what they do and are portraying the message and delivering the experience you want. In early days for a startup this isn’t so hard because all of these people = 1 person = you!
In all companies hiring right is a key success factor but as a startup and/or small company it can be the difference between success and failure. I know I am oversimplifying and there is tons of literature out there for more complex processes and systems and formulas and measures but this is what it breaks down to:
  1. Hire Engaged People
  2. Keep Them Engaged

If you Hire correctly, keeping engaged people engaged is not nearly as difficult getting unengaged people to engage. You have 500 things to do each day as an entrepreneur/founder/CEO and keeping your employees up during good times and bad is an absolutely critical aspect of your job but don’t make that harder on yourself than you have to with less than ideal hiring decisions.

For every role there are key components or competencies of the job that they need to be able to perform and perform at the head of the class but to me this is really just table stakes. Once you have some one who technically can do the job you need done here are some key things to look for:

  • Attitude – Attitude is everything. How are they emotionally in the interview, are they engaging, upbeat, smiling, eager, excited….regardless of the role you should walk away feeling energized not drained
  • Passion - Listen for knowledge and passion for what you do. They won’t know everything about everything that your company does but if they are not jazzed about the space and what you are doing from a macro perspective it will make my next point even harder for them to pass and that is……
  • StartUp experience – this is not a must for me but it something I have to feel very comfortable that the person understands especially depending on how I feel about the prior point. There are long days, all nighters, low lows and high highs and you have to be comfortable that this person has a “very healthy appetite for work” lets say
  • Spidey Sense – Call this your gut. You get a feel for someone during the interview. How will they fit with your team, would you feel comfortable if they were in front of your customer? your investor?

My last recommendation here is to have at least two interviews with someone before you make any offer. The first in a more formal, typical interview setting and don’t limit yourself to an hour (schedule them in the early evening say 5:30). If things do go well you will want more time to explore and the time will fly. If they pass the first interview the second interview should be in a more informal setting and should involve more members of your team. If you normally go for a pool night, darts, GH3, whatever…invite them.

None of these are rocket science but they are 4 simple points I have written on my white board at the office as I go through the hiring process. Write them down somewhere so you have them and just take a look at the points before and after you conduct your next interview. I actually have a ranking and weighting for each of the four but that is just the finance guy in me needing to bring EVERYTHING back to numbers so I won’t bore you with that.

Interested in your comments on your best and worst hires and what happened….hope these help!

Some other great posts on this topic:

Tech Capital Partners – discusses the value of Employee Engagement

DangleTech

Dharmesh at OnStartups – talks about his hiring thoughts for startups

Delight Your Way to Success

I have been spending much time lately reading and thinking about customer engagement and experience and the importance of it in all businesses. Having a truly passionate customer base is not just for intimate startup companies, as Apple and the recent lines we all witnessed clearly illustrate. Having your customers so delighted with their experience that they will tell their friends and Twitter about their experience and proudly show/tell everyone they know is the most powerful (and inexpensive…sorry Finance guy in me coming out) marketing program any company can achieve. For a startup company positive word of mouth, press and chat is even more important as it can be the difference between success and failure. There are two sides of this experience that I’d like to cover, the product experience and the human experience that in my opinion are equally important.
PRODUCT EXPERIENCE
Building product that is focussed on solving a specific problem that a target audience has or providing them with a new experience they will value is obviously table stakes. Truly delighted customers are looking for much more:
  • Make product consistent and reliable
  • Save time or improve the quality of time for the customer
  • Ease of use will increase adoption and stickiness
  • A slick, well thought out user interface is a game changer
  • Flexibility in design (because your customer is going to try to use you product in ways you probably hadn’t imagined…and you want them to)
  • The WOW factor…can’t really describe it but you know it when you see it
  • There can be many others depending on the application, audience, etc

You are not beside your customer when they use your product for the first time, make sure you nail form, function and WOW.

HUMAN EXPERIENCE

EVERY interaction you have with a customer is an opportunity to delight a customer and build your brand. Really folks, this is not hard. Every person in the organization, whether there are 3 or 3,000 is in marketing and sales. I posted earlier on a simple experience at Dairy Queen (sadly no freeby’s have arrived at my door) which demonstrates the difference every person in your company can make.

Everytime someone calls in for support on your product….delight them

Everytime someone calls to complain….delight them

Everytime someone asks you where you work….delight them

Attitude is everything, be excited and passionate about what you do. If you aren’t how do you expect them to be so moved they will tell their friends and wear your shirt. Always ask them for feedback and suggestions, engage them in making things better. Hiring, retaining and maintaining engaged employees is a seperate post I’ll cover later.

RECOMMENDATION

My call to action that I think goes a long way to help at a startup: When people download things (product, trials, etc) from your site make it mandatory to enter an email address AND a phone number (don’t worry if they have come to your site and are interested enough to download a trial, they will). Now, don’t just email your customers call them. Have everyone in your company call at least one person a day to interact and ask some set questions to collect data. This is your chance to delight them on the phone and make a personal connection that will solidify your relationship. At the end of every day, huddle as a group for 5-10 minutes NO more and run through what you found out.

Several major accomplishments occur with this process:

  1. Employees stay engaged with the solution and are always in sales mode every day which creates positive energy and momentum and allows they to get better and more comfortable with it.
  2. The customer experience is enhanced and over time you will build a loyal following of delighted customers.
  3. You will accumulate data, critical intelligence, on your company/product and share it every day which will allow you to spot trends, isolate problems, share wins and drive product and the company forward in lock step with your user community.

Try it and let me know how it works.

The Power of a Positive Attitude on the Customer Experience

Is Dairy Queen the best place in the world to work for a 17-19 yr old young lady…maybe/maybe not. Is it her lifelong ambition and the reason she gets up in the morning…probably not. Does a 17-19 year old typically prefer to work on a Friday night or perhaps do something slightly more social?

As I waited for my son to finish one of his many extracurricular activities I decided to swing by DQ and grab a small blizzard…ok it was a medium but the amount of ice cream I consume is not really germane to the story. As I walked in the store there were two lines, one had a person ordering the other was empty. I walked towards the registered and a young lady greeted me with a big smile and in her most bubbly voice said

Welcome to Dairy Queen tonight, my name is Miranda isn’t this a great night for ice cream!

I replied….

absolutely

Miranda then asked

What can I make for you tonight

I said

I will have a medium Peanut Butter Cup Blizzard please

Miranda replied with

Great choice, my absolute favorite

Whether it was really her favorite or not was inconsequential. I found myself smiling and feeling good about my selection. Miranda smiled, processed my debit payment, thanked me and turned to make my blizzard. As she went to the machine she smiled at her co-workers, provided some direction to a young man with an “In-Training” pin on and returned with my blizzard, smile still on her face and exclaimed

Here you go, medium Peanut Butter Cup blizzard. I hope you enjoy it, enjoy your night and please come back and see us

I stayed in store for a couple more customer interactions which went essentially the same way mine did and came to the conclusion “in my software mind” that Miranda was the best user interface that DQ could have. Whether it is service related, product related, P2P, B2B, whatever….a diligent focus on the customer experience is the single biggest thing you can do to ensure customer satisfaction, repeat business and viral spread.

BTW…I think it was the best Blizzard I have ever had!