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Posts Tagged ‘marketing’

Setting a Price for Your Product

January 17th, 2011 No comments

As I’m getting close to the launch of my product, I’ve been struggling with the question of how much to charge. There are a number of models, with differentiated version-based subscription being the overall favorite for online services. However, other models do exist as well; you can charge based on percentage of spend, have a consultancy based component (which is usually more than you would charge for the product).

However, you do not want to charge too much (which would mean ‘no-deal’) and not too little (which would imply that you are leaving money on the table and which ultimately can threaten the viability of your concern).

A happy median  does exist though. If you can figure out the value that your product provides to the customer, you can charge accordingly. Even if your product is not the most sophisticated, it is worth something (as long as it does not provide negative value).

Just start charging for what you have today, and work on improving the value you provide to to customer. There is a nice 45 degree slope that you can climb, whereas as long as you provide increasing value, you can charge a higher price.

The important of qualifying leads

July 28th, 2010 2 comments

Over the past year, I worked in excess of 60 hours a week, between my consulting, working full-time and the development of my prototype, and the education/organization aspects of establishing, maintaining and nurturing a startup.

I had the opportunity to learn some very valuable lessons as part of this process. One of these concerns qualifying your leads.

As soon as you have something of value to sell, whether it is a product, a service, a capability or information, you get into conversations with people in your network who want to benefit from what you are peddling. I have noticed that the ones who are the most enthusiastic about your startup’s offering are usually the ones that you want to avoid. They want to essentially spend your R&D budget on solutions that may be of use to them, without investing anything material into the process.

On the other hand, the people who are skeptical, and appear worried about whether they should work with you are the ones who have something at stake. They have a budget that they want to spend, and are weighing whether they should spend it with you, or with some other alternative.

The important thing here is that they have a budget, and that makes them the sort of customer that you want to spend your effort on.

Keep these customers, and the other guys who want to have endless meetings, and let you run with the development and expenses, and be there for the upside without shouldering any of the load, well, it may be time to discuss consultancy fees for advisory services :-)

The Collapse of Complex Business Models

April 2nd, 2010 No comments

Clark Shirky has an excellent post on how complex business models are collapsing in the face of modern technology. It’s a very well argued piece, with examples from media, telecom and ancient empires. Well worth reading.

This also dovetails well with the hypotheses behind the “blue ocean” strategy and “innovator’s dilemma” books, which both essentially state that disruptive technologies usually come from solutions that are resource-poor initially. It’s not always the superbowlesque ‘buy millions of users’ strategy that wins out. A viral strategy, based on an easy to understand value proposition, coupled with natural referencing can always beat out the most expensive of ads in terms of effectiveness.

Read the post here.

On ‘Finding your Brand Essence’

March 27th, 2010 No comments

Seth Godin is a very prolific blogger. There is a lot of wisdom in his writing, I’ve had quite a few ‘aha’ moments when I can snatch a bit of time from my busy schedule to dash through a few lines that catch my fancy (and his articles are usually not too long, which is nice).

Of course, as with all nuggets of wisdom, the real art is in knowing when that particular nugget applies to your situation. I just read his last article, and absolutely loved it. Read it on this blog at Finding Your Brand Essence.

If you go a bit deeper into what he is saying, you get the message that you should always have a strategy. This is important, because when you have strategy, it means not only that you have a doctrine, vision, and a set of values to guide you to success (or a glorious attempt trying at least), but that you also know where not to go, which battles not to fight, and which doors to close on your way.

Nicely done Seth.

Being Customer-Centric

January 6th, 2010 No comments

Specialists have a serious problem. They view the world through lens that have been honed through years of experience.

This can seriously hinder your effectiveness when dealing with non-specialists. In my field, jargon-terms like information-theory, program complexity, IO-bottleneck and scalability have very specific meaning, and are an excellent way to communicate with others who have specialist training. You don’t expect the other person to go off and spend a week reading about info theory, and then building up their evaluative instincts over a few months of tinkering around with labeled data-sets.

However In The Real World (TM), you need to interact with other people who come to the stage with a different set of experiences. We have to be sensitive to this reality.

Earlier in my career, I remember interviewing this brilliant scientist. He had a boatload of transferable skills, and was really sharp, however throughout the interview, he kept harping on about how he wanted to continue the very specific work he was currently doing with unstructured databases. In the end, I decided to go with someone more amenable, even though the other candidate was probably not as proficient. He did a poor job of selling me. I had no problem with his competency, rather the issue I had was that I was not willing to risk the project by bringing someone on board with a pet project they wanted to pursue. The gentlemen did not convince me that he was the man for the job.

In marketing, there is a saying that is well known. Consumers purchase the ability to make a quarter-inch hole, and do not buy a drill.

Sure, there are some people who are abstract thinkers who will actually internalize the desire to ‘purchase a drill’ as they can logically equate it to bringing them a step closer to their goals of building a treehouse for their son, or renovating the basement. However, more people don’t bother to build this superfluous cognitive structure.

Indeed, I am convinced that if consumers were capable of making a clean hole in the wall or in wood with a simple screwdriver, even if it took twice the time, they would never purchase the drill in the first place.

The real reason that drill sell, in my rather subjective opinion, is that the holes are cleanly made, and there are complementary goods (such as wall anchors) that require a drill-made hole.

Indeed, many people who I know that do hobby wood-working would use a hacksaw anyday over a power-saw. They claim it allows them to keep their fingers attached to their hands :-) If these people were working industrially, they would purchase the powersaw (as time is money), but as consumers (without tool-envy) they are happy with the lower-tech solution.

Architectural changes in marketing

July 8th, 2009 No comments

This is a guest post by Glenn Schmelzle, who is contributing his analysis on the new opportunities in marketing that follow from the paradigm shifts sweeping the information technology landscape.

OK, so marketing isn’t known for its use of cutting-edge tools. But as someone who’s been handling the tools for 15 years, I have noticed big changes in the technology that supports the buying and selling of products. These technologies have made life easier for both sellers and buyers, but I’ve deliberately skewed them because the more they’re used, the more they end up benefitting one side more than the other.

Innovations benefiting the buyer’s side:
Probably the biggest boon for those who need to do their research before buying is the corporate website. Unlike the days of calling an 800 number and getting a brochure or catalogue in the mail (and several follow-up calls!), people can obtain rich detail on a product before identifying themselves. Thanks to XML, price-shopping sites allow them to compare competing products. Sellers aren’t fond of these developments, because they have to divulge a lot of information, but market forces give them no choice.

As email became the dominant communications mode for B2B interaction, it began to be accompanied by a terrific tool: the spam filter. This innovation, more than legislative restrictions, has put people in control of their inboxes. They are preferred by any principled marketer and very feared by any spam artist. Sure, there’s room for sellers to send a one-time-only inquiry as well as opt-in based emails, but in the end, you can choose who to maintain relations with on email.

Social media is on the rise as a buyers’ tool. Its chief use here is to connect with others to share information on products without even consulting the product’s makers. There were earlier iterations of this like TripAdvisor and Epinions, but the newer crop: Twitter, Facebook, Techcrunch and the blogosphere have put the web’s usefulness as a third-party opinion tool into overdrive.

Innovations benefiting the seller’s side:

I think CRMs have had the largest impact in recent years. Whether local or in the cloud, private or open-sourced like SugarCRM, they are great for letting everybody in a company toss what they know about the customer into one bucket. The resulting profile gives a picture of prospects that is much more accurate than ever before. Here’s one example of how CRMs and direct marketing techniques have helped: You used to receive new product promotions in proportion to the product’s revenue forecast. If you weren’t part of the audience it was meant for, tough! Now, you are (usually) receiving promos for items geared for you. The fact that you receive more of these messages is a direct result of the mushrooming number of products on the market; it’s not marketing’s fault.

The beta deserves mention. No, not the VCR format that duked it out with VHS in the ’80s. Few technologies today are launched ‘cold,’ most are pre-released to power-users. Everything about a product can be crowd-sourced today…and it’s a good thing. The vehicles for leaking info (and code) on new products have also exploded in use. WebEx, AppExchange, sourceforge and Amazon’s EC2  have all dramatically reduced the cost of sharing work-in-progress with potential buyers. This ultimately lowers risk for the seller; no one wants to have another ‘New Coke’ fiasco on their hands.

Creating documents in Adobe format has been a significant development in marketing. As the P in PDF indicates, it’s made print-quality collaterals extremely ‘Portable.’ This has not only eliminated printing and mailing costs, it has produced instant gratification and reaction from buyers on the content of those documents. If buyers don’t react well to the collaterals, marketers can re-write and re-publish them in no time.2016 balklänningar Line. Denna samling erbjuder ett brett utbud av vackra stilar, så du kommer att vara säker på att hitta din perfekta klänningen. Dessa hänförande balklänningar varierar i stil. Så du kan vara sexig, klassiker, sassy, våga, och så mycket i en av dessa fantastiska klänningar! Det är en klänning för alla, ser till att ge en smickrande stil för alla

Finally, I’ll mention the umbrella category of Business Intelligence tools, that includes web analytics, email measurements and social media monitoring. These are all means for marketers to understand what works – this data was nigh unto impossible to have in pre-Internet days. Marketing Automation tools like Silverpop, Marketo and Eloqua are now giving unprecedented visibility into the sales funnel. This holds the promise of tightening sales forecasts and informing executives specifically how well their tactics are working.

To conclude, these tools have been fantastic as they’ve forced buyers and sellers to rethink how they do business. Together, these have all helped buyers and sellers reach out to each other. I think they’ve supplanted old, crude, disruptive marketing methods. They provide a great indication of how far we can go in the future, although knowing exactly where innovation will happen next is anyone’s guess.

Glenn Schmelzle is a technology marketer and worked with Shahzad at an Ottawa-based startup. He can be reached at glenn.schmelzle@utoronto.ca