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Is your product vitamin, pain killer or vaccine?

2014 has been a year of great momentum for software products in India and its going north in 2015. As the momentum picks up, thought of sharing some thoughts on a thumb rule that we can apply for products that we plan to build

Picking the medical analogy, the one way of classifying where your product fits in would be when you answer if your product is a vitamin, pain killer or vaccine – and how you innovate around them.

vitaminvaacine

Pain killers

The must haves are the pain killers, you can’t survive without drugs that cures fever or other painful diseases. In software products area, an equivalent is the automation software that will help you bill your customers, keep your accounts, communicate through emails, build professional or personal network etc. These are very basic, been there for a while and there is always market for these products. But the challenge with these products is that you are not the first one building it and you have tons of competitive products. A funny example I came across when a team mentioned they are building a product for traffic problem that exists in Bangalore, but the how part was not convincing enough to believe it can solve the problem. While the problem is clearly understood, and is a pain, the pain killer solution is key.

Often referred as commodity market, the only success factor here is “how” you solve the problems in a different way, leveraging latest technologies such as mobile, cloud or internet of things. Value of such products, in order to be successful, needs significant go-to-market investment. Nevertheless, if you have found the right product – market fit, there is still scope for this as everyone needs these products, as there is no question “why you need these products”, as long as you can differentiate and sell.

Vitamin

The nice to haves are vitamins, we all know that. You will agree that to sell vitamins, you really need to first establish “why you need that product”.  We do see the benefits, but we can live without it. Analytics and big data products are good examples of vitamins analogy. It would certainly help for your data driven decision making, but you need to convince someone a lot as he or she is already getting the insights in different forms, maybe through a good team that he or she has. But like how we get addicted to some vitamins, you can tend to get addicted to software products that can help businesses or life better. Also over a period of time, vitamins become pain killers as we can’t live without them. A good example for me is Google or Mobile phones or ipads. We have lived without google or mobile phones few years back, but they are no more an option. Ipads is still a vitamin, but still sells very well.

Vitamins need a different kind of expertise in your sales and go to market organization. You need experts to sell these solutions. They really need to uncover the invisible need that the buyer would have and offcourse your product needs to fulfill their aspirations by educating them. Vitamins can be sold at a very premium price if we can convince the customers.

 

While painkillers take care of the visible need, vitamins have to discover the invisible needs

productInvisibleneed

As you build products that fall in the vitamin category, it would be great to see the end vision of these products, and if they can eventually create a new category that can get into a pain killer or vaccine.

Vaccine

They are preventive; they address solutions to problems that exist today or likely to arise in the future. They are must haves, but they get into territory of unsolved problems, so if you have a solution that solves an unsolved problem or even prevents the problem to occur, they would fall into this category. Vaccines type products are real innovations – as they are needed and they can help businesses or improve life.

Business networks are a great example of vaccines, as they remove the hurdles of problems such as intercompany reconciliation or payments by cheques. Knowing your customer is great problem that exists and you want to sell the right product/services, at the right time and at right price based on what customers are seeking. If you understand the customer better, it’s a no brainer that your revenue is going to increase. Next generation customer engagement solutions are a good bet, which personally can fall into the vaccine bucket.  I was super impressed by the Health care cloud mobile products developed by Lifeplot, and many of their products certainly fall into the vaccine category as they can prevent diseases at an affordable cost.

While vaccines are game changers, they also need certain degree of convincing to sell, as the problem is not obvious to many.  One example for me in software products is digital commerce such as web and mobile. There is a huge opportunity to tap into selling in these channels and having products to support them. But it still needs to convince the buyers, as certain level of education is required for this.

Criteria Pain Killer Vitamin Vaccine 
Need Must have – Visible Nice to have – invisible Must have – Visible
Problem statement Well defined Need to be explained In certain cases defined but needs education
Main value prop to sell How its solved Why its needed How its solved and sometimes why its needed 
Sales approach Non Experts but with clear differentiators for product – market fit and lot of investment Experts required to explain value with lot of investment More education required, and once convinced less investment
Revenue and Pricing Standard Premium Standard 
Examples ERP, Emails Analytics, Messenger Business Network, Digital Commerce

 

So where does your product fit in – is it a pain killer, vitamin or vaccine ? 

 

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Over seven seas: Why Indian companies are increasingly going global

NEW PRODUCT-3While there are no numbers or research on how many Indian startups have global operations, I suspect it will be a sizeable number – a number that is growing every month and every year. No longer are Indian startups content in serving merely the domestic market, this new breed of startups and entrepreneurs consider the world as their market.

This, however, is not something that has happened overnight. We see a considerable number of Indian companies like Zoho, InMobi, Zomato going global and one consistent theme is that the entrepreneurs have some sort of a global stint. A recent report said that in China, 5 out of 10 billionaires are Internet billionaires and the common thread is that they have all studied or had stints in the US.

I feel a lot of us in India have the global context, having studied or worked or having both those experiences. Global context enables us to understand what market opportunities exist and the emerging trends throughout the world. To build a global company you need to have a global perspective and you need people at the top who think that way.

The second big pointer is the evolution of the Indian IT industry. When we started the revolution of IT services in 1990s with companies like HCL, Wipro and Infosys, it was all about labour arbitrage and how to get things done in a cheaper, better and more efficient way in India. Now that story has been beaten to death and people are more aware of what services companies are doing in the context of the opportunities that exist globally. Hence, instead of being a mere back end provider, people want to move up the value chain. People understand the opportunities and are now questioning why they can’t go out and address it.

Business today is borderless and in a global economy, boundaries have blurred and opportunities can be tapped across the globe. The intermingling of cultures and people on a very large scale has meant that whenever anyone thinks of any opportunity it is very easy to think about it as a global opportunity. Previously the thought process was limited to the market size of the domestic market.

For example, when we talk about selling to the travel and hospitality industry, we think about how many hotels exist globally and how many airlines operate across the world. The globalized nature of what we do today makes it much easier to implement ideas. There may still be some friction in the system, but today it is relatively easy to have the world as your playground.

It is also the question of market size. Although the 1.2 billion dollar home market may be a very big market, operating globally gives you a much bigger market size. Take for example the fact that 300 million tourist travel domestically, but the travel and hospitality market in India is fragmented. As a result the organized hospitality industry has about 120,000 rooms. New York alone has 120,000 rooms.

For us as a B2B player, we have to go where the marketplace is more mature. India today is as small as New York for us. Globally, we have 500,000 hotels and 500 airlines cater to. Even product companies that started with a notion of serving the domestic market have now gone global. It is also the case that if you are successful overseas, the domestic market tends to you accept you faster. Druva, Zoho are very good examples of that.

The ticket size for everything is much more globally. If a company sells something for a minimum ticket size of 10,000 dollars globally in India one has to sell it for 5000 $. The cost of operation for most of these companies, whether they sell domestically or globally, remains the same and any marginal increase is the cost of sale. Just by selling overseas, even for a small incremental change in cost, the company enjoys a much larger margin. It makes much more economic sense to go overseas, which means the opportunity size is much larger.

By going global Indian companies are writing a new chapter in how the world perceives us. Many of them are the future billion dollar companies and will serve to be great ambassadors of the are “Made in India” campaign that our Prime Minister has embraced.. With every globally successful company, India is creating role models for others to emulate.

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My learning from taking an idea to product to business – Sampad Swain, Instamojo

Instamojo.com was released to public on 24th April, 2012. That’s little over 2 years back. Here’s a screenshot of how it looked then with the boilerplate message:

Although, we haven’t shifted from our core vision but we definitely have learnt a lot more about who are our customers, what do they want and what should we do to make them happy which in turn will help us meet our business goals as well.

Now, here’s our homepage today in all its glory (WIP):

Along the way, we have learnt a lot about e-commerce, payments, laws & regulations, fraud detection, security, distribution & much more.

Most importantly, we learnt over a period of time how to marry design with commerce for the right final outcome for our customers (thanks to@sengupta and @kingsidharth)

Shameless promotion: Today, Instamojo.com has one of the highest payment conversion rates in the e-commerce industry.

1. Idea phase

We never spent much time on perfecting from the start. Main idea was to release the product to an initial set of customers quickly (we took around 3 week’s time); then start iterating vigorously based on that feedback. However, we never got distracted by others’ worldview of our product vision. So, we took that as an opportunity to learn and shape it accordingly.

Our initial estimate was, let’s build 80% of our core promise and iterate at a supersonic speed. Hence, lot of our core technology decisions was around this hypothesis like choosing Heroku over Amazon AWS for faster deployments & freeing engineering bandwidth (thanks to @hiway). However, we recently shifted over core infrastructure to AWS (thanks to @saiprasadch) since at scale it works best, both economically & reliability point of view.

Also from business point of view, we decided we will never chase moving targets (learning from our previous pivot). In simpler words, we narrowed down our focus & made decision making process almost binary. That, in a way set forth our straightforward, no-nonsense, more data-driven culture from day 1 which we keep following across functions (much thanks to@gehani).

2. Product building phase

This is the most exciting phase of any startup. But truth be told that this phase is also the most treacherous too.

I’ve known many smart founders fall in the trap of loving their product way too much (including me in my last startup) and slowly decay to oblivion even before reaching the business phase.

I think this is due to the fact that technical founders find this phase most apt to their persona i.e. building, hacking without much interaction with customer(s). Hence, they fall into the trap of just building and not selling or interacting with customers enough to understand what should be built & what shouldn’t.

We at Instamojo heavily relied on past data to help us cross this phase. Fortunately, we had got some customers who kept us on our toes to keep improving the product and add more. While at it, we kept on charting our product road-map into 3 buckets:

  1. Reach
  2. Revenue
  3. Retention

And depending on the impact of each bucket to the business then, we decided our product road-map.

During this phase, we released 25+ big features in 9 months depending on each bucket’s impact on the business & customer-set, thus balancing both growth in business metrics & customer development.

3. Business building phase

This phase, according to me is the most hardest phase; and one we are experiencing. In this phase, we get to hear good’ol phrases like “good problems to have than having none” which frankly is so true.

This phase is all about numbers (for both internal & external stakeholders) like

  • Figuring out all possible customer acquisition channels (both paid & non-paid).
  • Market sizing with absolute TAM (target addressable market) etc.

In simpler terms, business phase is all about growth:

  1. Growth in revenue metrics
  2. Growth in user acquisition metrics
  3. Growth in ________________ (fill in the blanks for your business)

We at Instamojo are experiencing this from all corners. We grew almost +10X in last 6 months in all possible business metrics. We finally hired our 1st full-time sales person last month. We are growing at a rate of almost 1 hire every 2 weeks across engineering, sales, operations, risk/safety, marketing etc functions (P.S. if you’re interested, here’s our careers page).

Closing words

“Growth” is any startup’s much needed oxygen. But I couldn’t stress more on the fact that with scale comes newer issues, more responsibilities, pressure to deliver always etc. However in my opinion, the fundamentals of growth has to be laid down much before the “business phase” with clear focus on long-term sustenance.

We at Instamojo tackle these with being completely clear about our “big vision” and “what we stand for” to start with.

So over-communication is a great tool to garner more steam and momentum, so that we have less time to worry and more time to build against odds.

Reblogged from Sampad Swain’s blog.

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Have you seen a large ship going down? I have, from close.

Polaroid Corp was a great company. Its instant photography technology ruled the world for 70 years. It served presidents, leaders, businessmen and even common people – it was the only way to take an instant picture (a position taken over by the mobile phone post 2007). It had some of the best talent, great chemical engineering skills, manufacturing plants, distribution and experience in selling photographic products.

When I joined Polaroid, it had a problem. Its revenues had been flat at $2.1 billion for nearly 3 years. A new technology – digital camera – was making inroads into photography and a upstart called Adobe was riding a popular wave, on the back of an editing software called Photoshop. Within a week of joining as head of the software team at the India office, I was at its HQ – it was a grand office, old-world teak panelled, lined with glorious Renaissance Art, reeking of tradition and quite intimidating for a newbie!

8:00 am sharp we were in its massive board room, 10-12 senior managers with the CTO chairing the meeting, huddled over the Question – what should Polaroid do to compete with the digital camera threat ? The options on the table were a kiosk, an instant, digital camera, a digital camera with an instant printer, the instance camera with a digital storage, AND consumer friendly software to target hobbyists. SWAT teams had been assigned the task of researching each option and present their research, insights, analysis and recommendations. Then we would have a brainstorming session and short-list two candidates that could be presented to the management team.

As each team presented its report, I was impressed with their in-depth study of the problem, the technology landscape, the challenges, risks – it was very professional and I was happy to have joined such a team. They talked all the right talk – customer engagement, service, innovation, simplicity, fun, lower costs, ecosystem, partnership, leverage the brand – every management jargon you can think of (in the context of ideation) was perhaps mentioned.

Yet – there was a big problem. After clearly establishing that digital technologies were a disruptive force, with a significant growth potential, all the teams tried to answer the question – “How can this help Polaroid sell more film?” All their ideas, at this point, moved from the exciting to the complexities of trying to marry film with digital. How can we add an instant printer to the kiosk? Can a digital instant camera process film and store digital at the same time? Can a digital film be created? Each team came up with innovative, but complex ways to address this.

Since I was a new hire, with some fancy education and smart ideas (at least the CTO thought so when he hired me), I was asked to give my comments as we got started into the brainstorming. So, I started by asking the obvious question bubbling in my mind – “Can I ask why it is important for a digital product to sell film?” – it was as if I had dropped a bomb! The silence in the room was prophetic. It was as if a naxalite had been dropped into Lehman Brothers board-room. VPs looked at each other and the CTO, as if asking – “is this the bright guy you’ve hired?”

The CTO, a 60+ senior veteran, having seen many young bulls off, told me politely – “film is our unique strength. Film is where we are leaders. Film is how we make money. Film is what Polaroid is all about”. That should have shut me up, but as some of you know, I can be argumentative when I want to. So I told the board-room why digital, in my view, was a complete new technology – easier, cheaper, more fungible than film and in fact it would disrupt the film completely. Why we should build a digital only business and make money in completely new ways – software, storage and sharing.

In the discussions that followed, many people complimented me for my insights and said they were happy to see that “we have a good leader in India”. But the discussions for nearly half a day were around, you got it – “film”. When you put 10 engineers on a problem with a hard constraint, they will find 10 new ways to solve the problem, and they will love each one of their solutions, its given! Not one person in the room, with many years of experience, challenged the notion that film was not needed for a digital economy and that force fitting film was just going to make it hard for the consumer, which would likely get rejected in the market.

Later, at dinner that day, the CTO shared another piece of insight – ‘We are Polaroid”, he said. We cant do things that small companies like Adobe are doing. We will do it the Polaroid way. I accepted his wisdom as he was more experienced, celebrated, richer and he was my boss! In 6 months, I heard that Adobe was setting up its campus in India and I jumped across to the young upstart. The CTO tried his best to retain me back and asked me what would help change my mind – “you have to become a digital company, sir. I don’t see that happening if all of the company is chasing film”.

In the next 5 years, Polaroid invested significant profits to build these instant, digital products. Not once did they think of digital-only as an option. They continued to dismiss internal voices and the traditional, high-margin film business continued to be the black hole for ideas. The revenue stayed flat at $2.1 billion. In another 2 years, the profits from the film business fell off the cliff, digital had taken over the world.

In 2008, Polaroid filed for bankruptcy.

Moral of the story – Large ships go down when they are obsessed about their past and ignore the present and the future.

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Piracy and freemium killed the Indian software buyer

Nobody in India buys software.

If the above sentence draws your attention, read on! If you are based out of India, think of the last time you bought software (yes packaged products). Now think of all your friends and guess when they bought software. Now, here’s the clincher, “When was the last time you bought software made in India?”. 99% of the people, irrespective of their socio-economic status will respond in the negative. lr-processed-0399

Product evangelists will now talk about the cloud/SaaS and the subscription economy, and how it is the great leveler when it comes to software products. As an entrepreneur selling a SaaS software in India, let me be the first to tell you that it is really hard work. Most entrepreneurs have told me that the Indian customer is price sensitive, I say, a majority of them are insensitive. Now don’t get me wrong. I don’t wish to rant. I am trying to catalog and present reasons why selling SaaS software is hard. Here’s what I think it is:

Let’s talk a little bit about the Indian software market

In the last two decades, India has seen two revolutions which helped create a large software market. Firstly, the economic deregulation in the 90s which enabled a steady growth of the economy, disposable income and import of technology. Secondly, the telecom, and subsequently the PC and mobile revolution that has created a (supposedly) large software consumption market. PCs, Laptops and tablets are now commonplace in Urban and Semi-urban India and the latest numbers indicate 15 Million broadband and about 100 Million mobile internet users. A look at these gargantuan numbers and you might begin to assume a large consumption market, but to give you a sense of reality, let me ask you the same question one of my mentors asked me – “Name 5 large Indian software product brands selling in the Indian market”

Enterprise software is probably your best bet

If you are selling software, the enterprise market is probably your best bet. Bharat Goenka, co-founder of Tally solutions, said that “In developed economies, SMBs act like enterprises and in emerging economies, SMBs act like consumers“[2]. Many of our customers are SMBs who are looking to use technology to grow some component of their business. And most of the times, we don’t deal with the company, but with empowered employees. The ones who have a budget at their disposal and are forward looking in their outlook. What we found was that the same stigma that existed in the 70s and 80s in the US software markets exists in the Indian SME customers of today. A lot of them look at software as something that will displace them in the organization and are extremely defensive in the matters of adoption. But we all know how that worked out in the US and UK markets and I am hoping India follows a similar trend.

Oh wow! I never knew you could do this

A lot of people we have met have been genuinely surprised at what our product does. It’s tough to manage these customers because we spend a lot of our acquisition time on sensitizing them about the problem before we present the solution. Even if you are doing something radically new, it is easier to bucket yourself into a genre that is popular and accepted. For example, we are a customer conversations player, but it helps if we refer to ourselves as a Social CRM or a marketing insights product. Ignorance about a genre of products has a big pitfall – customers don’t know how much to pay for the solution. This is really tricky because it usually leads to a customer deliberating on paying for the solution.

“But we can do this for free on Google”

Freemium is both a good and bad thing. Almost every customer of ours expects a free trial for a few days. In the products eco-system it’s become a norm,  but a lot of productized service companies I know have been asked for a free trial on bespoke software. Most users don’t understand the price they are paying when using services like Google or Facebook and usually expect the same when we tell them about our “use on the browser” service. Usually this means we have to get into a lengthy explanation about  why our product costs so much. The best experience I have had was when a customer, who understood the online advertising economy, asked us if he could use an ad supported model of our service for free!

Freemium might be a viable option early on but when looking at growth and scale, I don’t believe freemium is a sustainable economic model. It is a marketing tactic at best!

“muHive crack codes”

One morning, while peering through our website analytics, we were surprised to find a search keyword “muHive crack codes” in the list. This was a good and a bad thing: good because some customer actually found our service good enough to look for a cracked edition, and bad because we knew this customer wouldn’t pay. And yes, if it’s crack worthy, then it is probably good software – that’s the Indian psyche. Industry estimates put the total value of pirated software used in India to be upwards of $50 Billion[3]. Why won’t we pay for software? That’s a long post in itself, but to be brief: piracy was not controlled in the early days of the PC revolution and hence the assumption that software is free. Also, cost of software has always been calculated based on the affordability and costs in developed markets. To illustrate my point, I will end this section with a question – If Microsoft Windows were to cost Rs 1000 instead of $149 (Rs 9000) would the piracy numbers be different?

The pricing slope

Researchers put the Indian middle class at earning $10/day or roughly $300/month. To give you an estimate of why this matters, the urban poverty line stands at $14/month – yes, a month. The Indian middle class is about 100 million people and $300 per month usually supports 2 to 3 people on an average. Now when you think in these terms, you can imagine what the cost of ownership of a $149 software sounds like. Add the fact that software is a non-tangible artifact and you understand why Indian customers are extremely cautious when it comes to software purchases.

Even with enterprise customers, your pricing strategy has to be “just right”. And you have to account for discounts. A majority of the Indian customers we meet ask for some form of special pricing. Now, this might not be a trait which is unique to the Indian market, but understanding the cultural and economic context of the demographic becomes very essential when it comes to pricing. Marketers talk about using tricks like prepaid accounts (India has a large prepaid mobile subscriber base), daily subscription and data based pricing but all of them have the underlying assumption that the customer is willing to pay and understands the cost of the solution.

In conclusion

All these are what we have found to be the issues with selling software in India. Even though we have good answers to some of the questions our customers pose, in my opinion, it will still take a long time for the Indian software buyer to evolve and for good product companies to make a mark. Rather than end on a dismal note, I will now list down what actually seems to be working for us, and also some insights from other producteers.

– Customer don’t mind paying for bundled software. Hardware, especially mobiles and tablets might actually help in software sales.

– Customers will pay for immediate utility. What someone referred to as “First order business” solutions; meaning something that can make them more money instantly. Example: Email and SMS marketing solutions. Customers don’t mind paying for advertising and reach.

– Customers usually pay when they feel they are missing out on revenue or an opportunity. A loss averse technique to selling is what we have seen work best.

References:

 

 

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21st #PlaybookRT – 13 Sales Mantras for Product Selling in India – Part 1

Last weekend, we had a playbook roundtable on sales(mainly B2B) at the Ozonetel systems office in Hyderabad. Aneesh Reddy from Capillary led the RoundTable. The focus of the roundtable was on sales in product companies. This included early stage sales as well as issues faced during scaling sales. A lot of points were covered and the participants were involved in very lively discussions with almost everyone learning something new from the others experience. So without further ado, the following were the main learnings from the roundtable:

Ozonetel office
1. Sales solves everything. The panacea for all the problems of a startup is sales. Somtimes even a PPT is enough to do sales. This was explained by Aneesh how in their Capillary journey they showcased their to be built product on PPTs to prospective customers and made the sale.

2. Initial sales has to be done by founders. This was universally accepted by all the participants. So every founder has to become a sales person. There is no second way about it. Once you scale to a certain level, you can look at hiring dedicated sales head and building a sales organization.

3. Freemium model does not work too well in India. Get a customer to pay something(maybe even Rs.100). Make the customer also invested in the product. Only then will they give the time necessary for your product and evaluate it properly. Pilots work well, but try to make them paid pilots.

4. In India Push sales work, for outside markets, consultative sales works. In all cases, your sales person should be willing to listen to the customer and understand his pain points.

IMG_2574

Payment Collection

Payment collection is a big problem for SaaS products. Following up every month for the collections is a full time job. Some pointers to help in this are:

5. Quarterly, Yearly payments. See if you can push your customers to pay quarterly, yearly upfront. Give a discount two sweeten the deal. This is ok as you receive the money up front and you are reducing costs on processing collections.

6. Disconnect services. Most participants agreed that disconnection of service works as a deterrent to the customer. Give enough indications/alerts about the pending disconnection and follow up with a phone call for collecting your payment.

IMG_2573

Lead Sources

7. List rentals. Aneesh suggested that buying the list of conference participants gave a better RoI than sposoring some event. So identify some good conferences in your domain and buy the participant list from the conference organizers.

8. Attend exhibitions. Exhibitions in well known places like HiTex in Hyderabad gave a lot of leads to the NowFloats team.

9. Subscribe to local magazines. Local magazines are a good source of business listings as all good businesses advertise in local magazines. Build your list by mining this data.

10. Employ a good PR agency. Once you are at some level of scale, it makes sense to employ a PR agency. The PR agencies have good contacts in the media and they will get you good coverage. Though, they may not directly get you leads, they will help in brand recall, hiring and fund raising efforts.

IMG_2576

Inside sales:

11. Start with a 2-3 member inside sales team. Aneesh was of the strong opinion that inside sales is the way to go for B2B sales in India. Start small and monitor the team closely.

12. Invest and be patient. Sometimes, it takes around 3-4 months for an inside sales team to show some traction. be invested and be patient. Things will slowly pick up.

13. Team composition. One combination could be 1 data collector and 2 tele callers. Try different approaches and see what works best. To get started, you can out source the process, but that may turn out costly.

In the next part we will look at some metrics that will help us monitor sales.

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100 minds – 8 mins with each.

In simple maths, every one of the 100 who saw the videos, was kept engaged for at least 8 minutes. Assuming they didn’t see all of the videos – a sales guy was around to continue conversations.

Humans have recently surpassed the attention span of a goldfish. And you thought keeping a goldfish engaged was easy….

Knowcross sells a service automation and management software to Hotels. It’s called Triton. Some of the world’s reputed hotels are their customers. For good reason – the tool is just remarkable to see at work.

Recently they attended HiTec – world’s largest and most expansive hospitality technology event.

“We were one of the last to book our space and we missed the best spots on the floor. Even with that, we managed to get about 200 people to the booth in 3 days. And about half of them we kept engaged through a touchscreen that played the 8 videos.”

Neha Singh | Senior Manager Marketing at Triton

 

Here are the 8 videos in their glory.

Triton EngineeringTriton MobileTriton SupervisorTriton Attendant

 

 

 

Content is one of those things a marketer has to spend money on. The pursuit, however – is to find the highest ROI from content. 

Here are 3 things that made their conference content investment a high return exercise:

1. Spray it. Don’t just say it.

Pepper your audience with multiple small bite sized information.

When you are expecting guests – as in a trade show particularly – try to put up more than a single piece of information.

So 100 brochures is great. But a choice between 20 each of 5 types of brochures – is a better idea. Within the first audience set (5 – 10 people), you’d know which brochures to send the mascot with.

“The 37 inch touchscreen had an application running. So after they see one video, they’d be presented with another one, and then another. This allowed us to comprehensively cover the product and its propositions without them getting bored with one long video. ”

– Neha Singh. senior Manager Marketing at Triton.

2. Address different causes.

If you can solve my problem – tell me how much you’ll charge. You’ve got 8 seconds. Go.

So Engineering has its own problems. Housekeeping has its own problems. The management has its own problems. And individuals within these units – have their own problems.

For Engineering – they made a different story – connected to the engineering’s cause. See this.
For Housekeeping – they made a different story – connected to the housekeeping’s cause. See this.
And for Senior Management – they made a more overarching story – connected to the business’ cause. See this.

So if Joe the CEO wanted to check with Bob the CTO – they would both just huddle at the booth. There’s a bunch of smartie pants ready to answer questions.

Instant gratification as many cultures call it.

3. Consistent and simple visuals

We eat with our eyes – as taught in culinary schools. That’s why plating is important.

Did your eyes catch the variation in the color RED above ?

In their case, the characters were simple with little detailing. So there was no distraction. And the colors and icons are consistent.

See the image to the left – there are 3 slides one below the other.

Did your eyes catch the slight change in color?

Imagine how distracted you’d get if the characters, scenes, music, or even narrator’s voice changed on each video. 

They got this done from a single creative team. A set of minds that didn’t change during the production process. This ensured visuals and audio and the look n feel and the sounds and voices – were all synchronized. Everything looks and sounds in sync.

Its like Ballet.

So the costumes were same colors. The characters were similar. The situations and icons were similar. Think different episodes of a television series.

If you have dabbled in Video marketing, what kind of results have you got from your initiatives? I would love to hear your thoughts.

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Go to market strategy for start-ups

For small businesses to succeed in today’s fiercely competitive market is no easy job. While you might think that once you ideate and put a business plan in place, your long cherished dream is soon going to be realized, hold on to the thought!

Have you given enough thought to your go to market strategy? If not, then right now is the time and the following tips will help you do it the right way: 

Deciding on your Target Audience

One of the most critical of the factors is to decide who your customers are going to be. Today, many smaller businesses are giving tough competition to large companies by targeting a niche market. One important factor here is to effectively understand what your customer wants. The sooner small business owners understand this, the better are their chances to succeed. Ask basic questions like – Who will buy my product? Who has already bought from me? What does my network think? How are my competitors faring? Will my target audience grow? In what timeframe will I see that growth?

Product portfolio for target customers

It may be difficult to sustain a business on only one core product. New competitors, changing customer behavior, emergence of new technologies and many other factors can pose a significant threat to any business’s success. Hence, it is imperative for small businesses to have a diverse product offering which will help them keep up with the ever-changing market demands. Adopt a test-and-learn approach and feel the pulse of customers which will help you to decide upon how and where to expand your offerings.

Pricing

Considered as one of the toughest things to do, pricing a product properly can a have a long-term impact on the success of your business. While there is no one surefire formula how to get the pricing right, small businesses must have an in-depth market understanding of the target customer profile, what the competitors are charging and the quality of products vis-à-vis the pricing of their offering. The more thought businesses put behind the pricing of a product, the better their proposition becomes.

Product Promotion

There should be a well thought plan in place for product promotion as it is in this phase that the word about your offerings will reach your customers and other key stakeholders. Hence, it is imperative that there is an efficient marketing and communication plan in place. These will include focusing on various promotional campaigns like advertising, selling, digital promotion, public relations etc.

To conclude, defining go-to-market strategy for start-ups isn’t a cake-walk, but by being smart, extremely aware of the market scenario and knowing the pulse of the target audience, small businesses can gear themselves up for a stronger and long lasting growth.

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Success Factor: Idea with Business Potential

Every engineer dreams of building his/her own product. Most ideas don’t progress any further, either because it was idle thinking, or on further reflection, they become less interesting. When a concept refuses to die, and you feel driven to explore it further, then some basic analysis must follow. What problem does it solve? Who benefits from the solution? Can you quantify its impact on the beneficiaries?

Ideas emanate in a number of ways. They can be a solution to problems that you observed at work or elsewhere. Perhaps you have spotted new opportunities arising from evolution or disruptive change in technology, environment or circumstances. For example, the advent of the PC, internet, and broadband connectivity over the past three decades, led to software that provided unique new functionality (e-mail, internet chat) or simply a new and better way of doing old things (online purchases).

Many companies have succeeded by catching a new technology curve early, and overcoming existing players (Microsoft with PC operating system, Novell with networking, Hotmail with internet mail, and recently SalesForce.com with SaaS).

Responsiveness to technology shifts is not an attribute of only small companies. IBM, for instance, has adapted to several generational changes in hardware and software. After its formal naming in 1924, IBM has seen competitors appear and fade away in the punched card, mainframe, minicomputer, PC, networking and the internet eras. Through them all, it has remained the No.1 technology company by re-inventing itself.

In comparison, here is what the CEO (Ken Olson) of Digital Equipment Corporation (DEC), a mini-computer vendor and strong IBM competitor, had to say in 1977, “There is no reason for any individual to have a computer in their home”.

Not surprisingly, DEC was eventually over-run by the PC revolution. IBM, on the other hand, launched its PC in 1981, and tied up with Intel and Micro- soft, to emerge stronger.

Your generic idea should be transformed into a rough product concept. Entrepreneurs should have sufficient domain and technical expertise to conceptualize how the idea, combined with its practical implementation, can address specific user or industry challenges. You can then, scope the problem and formulate a distinct and bounded solution.

The next step is to explore who your customers will be. At the most basic level, the product should provide a good solution to a known problem for a reasonably large set of people. The product may enhance a capability (what it can do), process (how to do it), performance (speed of doing it), or usability (ease of use) relative to the current methods. It must be reasonably unique and fairly difficult for someone else to quickly emulate.

Ideas don’t have to be unique to be successful. Excel overtook Lotus 1-2-3, the leading DOS spreadsheet, only because Lotus failed to make the transition to Windows quickly.

Sometimes, leaders don’t recognize disruptive changes. In a 1998 paper, Google’s founders described an innovative concept called PageRank, which took advantage of the Web’s link structure to produce a global importance ranking of every web page. This helped users quickly make sense of the vast heterogeneity of the World Wide Web. AltaVista, the leading search engine amongst 30+ others at the time, turned down the chance to buy Google for $1 million, saying spam would make PageRank useless. Yahoo also declined to purchase Google, supposedly because they didn’t want to focus on search, which they felt only sent users away from Yahoo.com.

Size also does not guarantee success. After their search engine and Gmail made Google into a challenger to Microsoft, they attempted to target Microsoft’s cash cow (MS-Office) with an online spreadsheet in 2006. Analysts expected this to eat into Excel (and Office) market share, but the latter continues to dominate. Still, in 2009, this competition forced Microsoft into announcing a future online, free version of MS-Office.

Ideas are like movie scripts. Most of them sound familiar. They are often a combination of previously seen sub-plots, with new twists added. Still, many of them become successful, especially if they have some novelty and are executed well. Even remakes succeed if presented differently. Very rarely do you see a hit movie with a truly unique script.

Reprinted from From Entrepreneurs to Leaders by permission of Tata McGraw-Hill Education Private Limited.

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iSPIRT Sales RoundTable – Startup Sales, Lead Generation, Channel Partners

First of all, huge thanks to Vizury for sponsoring great food and the premises to hold the round table. Many thanks to Aneesh, NRK Raman and Srirang for leading the session and providing valuable inputs. And of course, to all the participants for the energetic discussions and knowledge sharing.

Here are the key takeaways from my notes.  Please note that there are several nuggets of practical advice based on the experiences of the session leaders and the participants, and not just standard text book stuff. It was a great learning experience for me and I hope I can pass on some of it to you.

While we touched upon a lot of topics, we spent considerable time on startup sales, channel partners and selling to geographies outside India, and lead generation and qualification.

Read on to know more.

Startup Sales and Hiring Salespeople 

Best guys to sell during early stages of the startup are the co-founders themselves, even if they don’t have sales background.  Initially, you will stumble, but you will learn and figure out what works for you.  If founders cannot sell the product in the first 1 or 2 years, then you must seriously evaluate the viability of the business

Once you’ve made the initial sales yourselves, then you put in a structure. External sales guys need to have conviction in the product to sell it.  That will be lacking during the early stages of the company – but founders have that conviction.  Hence founders can sell better during the early stages.  One participant mentioned that for the first 3 years, he and his co-founder were selling and only later they looked at a professional sales person.

Getting the first reference customer is always the toughest part. One you have a reference customer, momentum will build.

Hiring an external sales guy is not a good idea at the beginning.  Identify folks from engineering and customer facing teams who have the aptitude or inclination to do sales and ask them to lead Sales.

Culture fit is very important in a sales person. Also, check if the person has spent 4+ years in a single company – that shows that he has been delivering results.  Sales people should also be pushing back to you.  This shows that they are getting feedback from the field and are informing you about market situation.

It is a good idea to raise investor money to scale up business development.  Investors are willing to invest in this once the product has been validated and you have a few customers.

You need to experiment to figure out what works for you. For example, for a company that made trading software, an ex-trader worked great as a salesperson instead of a seasoned sales guy, because the ex-trader was able to relate to the customer.

The sales person should have hunger and also have a good history of past successes.  Consider the age of the sales person too – in some industries, an older person might work better as the customers expect to see maturity.

Like pair programming, “pair selling” is also a useful thing to try.  This helps in DNA match, culture fitness.  Some companies have paired an account manager or a product manager with the sales guy.

In complex sales where there are multiple stakeholders from the customer’s side, ensure that you sell individually to all the influencers.

You need to pay close attention to how the customer buys.  Branding and marketing engine is also very important in “creating a desire in the customer to buy”.

Channel Partners (local and global)

When creating partnerships (in the context of channel partners and resellers) globally, be careful what works and what does not in that culture.

In general, partnerships work well outside your headquarters and you can have multiple non-exclusive partnerships.  People like to do business with a local person.

Look at the credibility of the partner.  Is the partner knowledgeable and up to date in your domain?  For one company, partnerships worked well in Brazil, but did work very well in Europe.

When you set up an office in other countries, you need to be aware of the labour laws regarding how easy/difficult it is to fire non-performing employees, taxation, accommodation etc.  Going with a partner alleviates all of this to a great extent.  However, you need to have someone from your team who is responsible for managing partnerships.

Remember that the main motivation for the channel partner is money. So make sure there is enough for them so you have their mind share.  Even if that means that the channel partner makes more money than you.  Initially, you need to be very involved so the partner tastes success. For example, you need to generate leads to the partner, go along with him to complete the sale and let him make the money from your efforts, initially. This will get them excited.

Similarly, if you want to have sales offices or channel partners in other locations, encourage well performing sales folks from headquarters to move to that location, stay there for a few years to set up processes, signup channel partners, hire local people and train them.

You can start by signing an MOU first and have some targets.  Then after 6 months of so, you can sign a formal partnership agreement.

One company also pays 20% of the salary of an employee of the channel partner.  Then you can have a joint business plan with your partner to set goals, metrics tracking etc.

You should look at your customer acquisition cost and consider pay a huge chunk (say 80%) of that cost to the channel partner.

While making sure that you do not have exclusive agreement with a single partner, be sensitive that having multiple partners in the same geography can lead to partner conflicts which in turn could be bad for your business.

Also, look at companies that sell complementary products. Maybe you can partner with them too so they make money by cross selling your product.

Channel partners are not really a must. If you can make your product easy to setup and use, then you can focus more on marketing, google adwords etc (e.g. SAAS models).  Also, in these models, you need to ensure that partners have good incentives as typically the ticket sizes are smaller and they don’t have opportunities to make money from “implementations”, training etc.  One company took an approach to let the partner decide the pricing in a particular geography with the agreement that a percentage of the revenue goes to the partner.

However, if the product is not easy and you need people on the field to educate the customers, you should definitely consider channel partners.

Sales Engine is similar to Engineering Engine

One of the biggest challenges faced by Indian product companies is that the founders do not have a sales background.  Our ecosystem has evolved to a point where we can build great products, but lack the sales acumen.  There was consensus among the participants that sales is much harder than engineering. Engineering, while no doubt hard, is still manageable.  We know the inputs, outputs, risks and mitigations with a high degree of certainty.  Sales is a different beast with lots of uncertainties.

Srirang guided us to treat the sales engine also similar to the engineering engine.

The three pillars for the Sales Engine are (a) People, (b) Processes and (c) Technology.

People: Competencies, Incentives, Org Structure.  As in engineering, there can be a magnitude of difference between an average sales person and a good salesperson.  So hiring the right candidate is very important.  And you have to set up the correct incentive program and org structure to ensure motivation and excitement in the sales team.

Processes: Strategy, Execution, Metrics.  Again, as in engineering, you need to define the strategy, the execution plan (who does what) and what metrics you are going to use to measure execution. 

Technology:  Enablement, Communication, Monitoring.  Sales team needs to be enabled.  For example, ensure flawless demonstrations and training to the sales people so their selling experience is smooth and they focus on the customer.  Use the right tools (e.g. Excel, CRM, SalesForce) to track and monitor their activities.

At different stages of the company, you need different kinds of pillars – which means you need different kinds of sales people, different processes and different technologies.

Lead Generation and Qualification 

The classic sales process consists of five stages:

  1. Lead Generation.
  2. Lead Qualification
  3. Relationship building
  4. Solution design
  5. Negotiation and Closure

Depending on the kind of product, some of the later steps might not be relevant, but lead generation and lead qualification are of primary importance.

Focused lead generation is better than generic lead generation.

Some companies have used databases of leads to generate leads and have found it useful for mass email campaigns.

LinkedIn is a good source to connect with prospects (with premium account, you can send InMail too).  After connecting, you can then try to have a call/skype to show your value proposition, if there is interest.

Someone mentioned that LinkedIn Ads worked for them.  On Google adwords, there were mixed reactions.  Some say it is costly, but it helps to put the word about the product. Google adwords can generate a lot of leads, but people also noted that there was a lot of churn from these leads (in the context of SAAS based business).

If you have a horizontal product, make a vertical offering. Your campaigns have to industry specific and you should talk their language. Customers are looking for a reference customer they can relate to.  This produces better results than targeting all verticals with a horizontal positioning.

Metrics is very important in the sales engine.  You must be measuring and tracking customer acquisition costs. And track them at various stages of the sales funnel.  For example, let’s say you generate 1000 leads, out of which 600 are then qualified, 400 of them get to proposal stage, 200 get to negotiation, 150 closed and then 130 retained for renewal.  At each stage, you must count the man hours spent and put a cost for that.  This will help you improve your sales processes – particularly in the area of lead qualification as you can see what kind of leads are working and you can pursue folks who are likely to buy.

The first step is to establish Qualification Criteria. Then evaluate each lead and assign score to lead based on the qualification criteria.  Based on the score, put the lead in one of three action buckets – pursue, drop or nurture (i.e. keep warm).

Also, ensure you pay attention to negative attributes to qualify leads based on your experience and judgment – e.g. if a company has greater than 2000 employees, then they might not be suitable to your business.

Don’t take up a wrong customer at startup stage. It can be a drain on your resources.

There are three main aspects of lead generation.

  1. Publish
    1. Blogs
    2. Website
    3. Industry Magazines
    4. Whitepapers
  2. Promote
    1. Speaker in conferences
    2. Advertisements
    3. SEO
  3. Connect
    1. Email
    2. Cold call
    3. Road shows
    4. Referrals
    5. Social Media

Conclusion 

The discussions “raised awareness” and provided lots of data from practitioners.

The key thing to remember is that there is no silver bullet and what worked for someone else may not work for you. Kishore Mandyam went one step further and said that what worked for them six months ago might not work for them now!  While there is no magic wand, you can look at general guidelines and best practices from the experiences of 20 odd practitioners.

If you have any more tips or best practices, please do write them in the comments section.

Tweetable Takeaways

Best guys to sell during early stages  are the co-founders, even if they don’t have sales background. Tweet This.

Getting the first reference customer is the toughest part. One you have that customer, momentum will build. Tweet This.

Channel partners should make enough money off you. It is OK for them to make more money than you. Tweet This.

Invest in channel partners so they invest in your product. Tweet This.

Sales Engine is similar to the Engineering Engine. Tweet This.

If you have a horizontal product, make vertical offerings. Industry specific campaigns work better. Tweet This.

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What’s my next Product Going to be? A Product Ideation/Extension Toolkit

You have your first product and it’s a success. Success only brings more demand from prospects, clients and customers for features that are not yet in your product. Some of them are not interested in all the features you have in your product but seem to use only some odd features. Or they have found a totally new use for your product that you have not yet thought of, as yet! As an entrepreneur you are sitting there thinking “Why don’t they just use what I have provided them in the way I think they ought to use it?”. These kinds of reactions from prospects and clients are not only normal but indicates that you are on the right path!. All of these can be confusing for a small product start-up. However it need not be. Here’s a toolkit put together with examples seen with various start-ups and mature product companies. Think of it as a set of dimensions along which your own products can be extended or new products ideated. Depending upon the nature of your software product – SaaS or On-Premise, different dimensions for product variations, price points or delivery methods could be applicable. The advantage of this kind of approach is that it makes it a systematic process and makes sure that what you do has exemplars elsewhere, preferably ones that have been successful!

1. Product Variants based on Number of Users 

This model may be  familiar with SaaS product companies. There may be a Free Version, say upto 10 users, Small Business version for  11 to 25 users and an Enterprise Edition for 26 to 400 users, for example. Before you choose this model it is always good to put yourselves in your clients’ shoes and make sure that it makes economic sense. Beyond a certain number of users, clients always prefer a very flat discounted pricing. I speak from personal experience! We once evaluated a SaaS product for a 25 person start-up company.  Beyond 15 users, a per user model did not make any sense for us since the discounts for more users was not steep enough. On-premise software was much less expensive than the SaaS alternative. An on-premise software with an initial steep cost and annual maintenance of 16 to 20% worked out to be much better. Like us, many clients and prospects may have unused server capacity, technical people on the payroll that have extra capacity. So hosting our own software did not add any additional hardware/software/people costs for us. This is a cautionary tale for SaaS product companies that go after large enterprises or elephants. Make sure your flat pricing makes it is still profitable for you with huge numbers of enterprise users after paying for servers, hosting, bandwidth, specialized support, etc. What if this client grew phenomenally?

2. Product Variants based on Additional Features

Most are familiar with Microsoft’s Home, Professional and Enterprise editions of software products. Basic features that made sense for home use would be in component products like Microsoft Word, and Excel. Professional editions added additional features in individual products and they added additional products that made sense in an office setting. Enterprise editions were capable of a lot more and some included server editions where the product is hosted centrally. One caveat is not to leave money on the table when you have a single product and you start adding features. At some point in time, your product needs to split into basic and advanced editions and you need to make sure you get paid additionally for added features. This is a problem you face after you add features. In product management, one of the big conundrums product start-ups face is knowing when to add a feature. If one prospect or client asks for a feature, put it on a running wish list. If two of them ask for a feature, put it in the next release. If three of them ask for it put it in the appropriate product variant and in the next build! When you do a demo and a presentation of your current product, always have Upcoming Features and Upcoming Products slides and solicit feedback.

3. Product Variants on Adjacent and Associated Technologies

In software product companies, there are always adjacent and associated technologies where your next products need to be. If your consumer facing product works in a browser, it may need a mobile version and sometimes,  vice-versa. Document management products may need workflow products to go along with them. An enterprise financial management product needs sales management, manufacturing, people management products to go along with them. This is one of those areas where paying close attention to what other software are used by your users may give you ideas about your next product stops. Clients will readily tell you what other products they need to go along with the one your sold them, if you have not already found them out when they implement your product. Integration services always go along with products, especially in enterprise facing ones.

4. Products based on different characteristics/preferences of users

Not all of your clients or users will use the product the same way. Some may re-purpose features you meant for something for something completely different. As I write this, our client is using an open-source CRM system for internal workflow handling. The reason is not that the workflow features of this CRM system are very strong but because the attachments and document version handling is very strong and 90% of their workflow depends on users submitting documents for verification, validation and formal certification. User Interface skins are based completely on preferences of users and personalization. For inspiration, consumer product companies like Unilever and Proctor and Gamble are great. You can be sure that there are one or two Dove Soap products, White and Pink, that contribute 80% of their sales. They still have Dove Sensitive Skin, Dove soap without any perfume, etc. Software product variants may not be that simple but paying attention to what different types of users or usages can lead to variants that make sense.

5. Products meant for different types of markets

Different markets may have use for some common features but sometimes may need to be completely tailored for a new market. Tax preparation software for the US market may not be of much use in Europe or Australia. Or by architecting the software a certain way, a lot of the software could be reused by including a business rules component and writing different business rules for different markets. Oracle Financials has an Oracle Government Financials parallel, which may have very little in common with it!. Adjacent markets are always good to go after. What are those markets for your product company?

6. Free Trial/Free-Paid Versions

Free Trial versions may be necessary for scaling your user base initially and converting them later on. Free Trials may have expiry dates but free versions without any expiry dates can provide data lock-in. Once a client or a consumer’s data is in your software, inertia may prevent them from switching and you can convert them to a paid one at some point in time. In some cases like LinkedIn, free and paid versions can co-exist and you can still have a profitable company. The free version may have some limits and if the limits are too onerous for intensive users, they may convert to a paid version. However, it is always better to provide as many of the features you can in the free version and not make it too much of cripple-ware! The free version should be fully functional for most of the simple stuff all of your users. If minimum functionality is not there for accomplishing something meaningful, free versions will only put users off. I hated free versions that don’t tell me after I have put in a lot of data in and then I cannot print anything or do something meaningful with it.

7. Service -Product Spin Outs

Tax preparation software companies also provide tax preparation services for consumers that cannot use the software, for whatever reason. This is a good example of spinning out a service from a product. If you are offering a service you may catch yourselves doing the same kinds of activities for your customers. If it can be automated or provided as a self-service online option for a fee, may be there is a product idea in there. That can be a service to product spin out.

When your product starts to take off, it may be time to streamline your offerings and create a road map of product variants and new products. It is better to have a process and some systematic thought put into this activity. Analysis of existing users, careful attention to what they are saying and which features of your product they are using; what they want new in your product or what new products they want,  can all help guide you in creating a product family and a road map. Having a set of dimensions in a tool kit helps  a software product company mix and match whatever is applicable to them to creating and rolling out this roadmap!

If you don’t know where you are going, any road will take you there! – Lewis Carroll in Alice in Wonderland

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Where is Dropbox headed?

Having started in September 2008, Dropbox today is a leading cloud storage provider (CSP). It has over a 100 million signed free users and about 4 million paid users (4% conversion rate as quoted often by Houston). Assuming the lowest payment tier (100GB at $99 per year), this translates into annual revenue of about $400 million. Based on Amazon S3 costing and estimates of Dropbox employee costs, the EBITDA works out to $250 million. Its costs are always going down and its revenues are always going up. The company is valued at $ 4 billion. Dropbox is making money hand over fist. Right? But consider this –

It now has more than ten competitors several with deep pockets e.g., Amazon CloudDrive, Apple iCloud, Google GoogleDrive, Microsoft Skydrive, Box, Spideroak, Ubuntu One, MediaFire, Mega.  Its other competitors, purely in enterprise space include HP Cloud Objects, Rackspace etc.

Dropbox offers the smallest free quota – 2GB plus referral bonus. All its competitors offer 5GB or more (Skydrive -7GB, MediaFire and Mega – 50 GB).

Dropbox pricing is probably the highest ($99 for 100GB). For same capacity, competitor prices are much lower –CloudDrive ($50), GoogleDrive ($60), Skydrive ($50). Box ($480), iCloud ($160). Spideroak ($100) have a higher pricing but have more powerful features (see below).

Dropbox is merely a folder service. Its competitors have other value-adds and lock-in mechanisms. For example, iCloud allows streaming of music, apps, books, and TV shows you purchase from the iTunes store, Google and Microsoft have GoogleDocs and Office WebApps respectively. Documents created through these apps do not count towards the drive quota. Box is designed more as a business-collaboration and work-flow solution that a CSP. SpiderOak is the only service that offers data encryption before your data hits their servers. Perhaps, acquisition of AudioGalaxy should enable Dropbox with music streaming feature.

The  giants like Apple, Google, Amazon and Microsoft see storage as a way to lure customers into their respective cloud and then “upsell” them on higher-level and more profitable services that they have in the portfolio. They have been aggressive in launching or responding to price cuts from competitors. Dropbox cannot win against these Goliaths in the theatre of feature and price wars.

The Dropbox differentiator was the near seamless experience backing up and syncing files to cloud on multiple platforms. That differentiator is rapidly evaporating with the competitors catching up. Moreover, what happens if all your files are already in the cloud for example music (iCloud, Spotify), Documents (GoogleDocs, Office 365), Pictures (Instagram) and so on. There are umpteen such scenarios that make Dropbox redundant.

I am sure Dropbox product managers are having sleepless nights. Do you have a product strategy and roadmap for Dropbox’s future?

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Why just ‘knowing’ your customer is not enough

Every customer support forum and blog has at least one post talking about the importance of ‘knowing’ the target customer. This is one of those well established cliche-stereotypes that David Foster Wallace points out in Infinite Jest – we talk about them so much because they happen to be true. The only question is, how true?

Is ‘knowing’ your customer really enough?

Cadbury’s knows that its customers are young parents buying chocolates for their kids or teens buying chocolates for each other or middle aged people buying chocolates as gifts. Netflix knows that its customers are strapped-for-time movie buffs who love the convenience and ease that Netflix gives them. But do Cadbury’s and Netflix really know who their customers actually are, what they are doing when they want to buy a chocolate or a movie, when the decision is made to buy a chocolate or order a movie, and so on.

The ‘ideal customer profile’ is not going to reveal the details, and these are the details that matter.

Getting your hands dirty

A month back, Economic Times ran a fascinating story on Airline bosses and the lessons they picked up from talking to passengers while travelling. They figured out how important cheese sandwiches were, faced ground-level problems, got themselves a crash course in regional culture and basically got their hands dirty. The CEOs of India’s flying corporates, though competitors and sometimes bitter enemies, all agree on the point that they learn more from actually being in the shoes of their customers than by anything else.

This is something FMCG companies like ITC and Unilever know very well. Both these companies send their fresh recruits out into the field, into the place where the product has to be sold – the rural heart of India. Even the top management heads out to the street sometimes, in search of that small and elusive insight that could take the sales charts off into the stratosphere.

Do it like Dockers

In Malcolm Gladwell’s retelling of the story, this is exactly what ad agency FCB did with the Dockers campaign of the 1980s. The campaign called ‘Dockers World’, catapulted the khaki brand into probably the most ubiquitous male fashion statement of that period. The insight that FCB used was the male baby boomers’ urge to conform to standards, and not look like a made up Ken doll. The Dockers khakis were exactly that, they came in just three colours then, and all of them were made up of the stringently similar amount of cotton. And so the men who wore Dockers ‘fitted in’, which was exactly what they wanted to do. The iconic campaign is still remembered as one of America’s greatest, and FCB still consider it one of their crowning achievements.

Look for that insight

This story again illustrates why just knowing your customer isn’t enough. And in a product marketing setting, it only makes more sense. The customer profile you have drawn up can help, of course, but it will never come close to looking at the world from your customer’s eyes, figuring out his motivations, his reasons for doing something and what he wants from the product you want to sell to him. These questions may have the most surprising answers and from these answers, will come the insight that will endear your product to the consumer.

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6th iSPIRT Playbook RoundTable: Challenges in building a global software product company from India

In the continuing series of Round Tables product veterans Samir Palnitkar, ShopSocially and Jatin Parekh, AirTight Networks took the participants through a journey of discovery about why they want to go global and taking a critical look at the challenges they must overcome.

It takes a guy like Samir to lay the foundation for such a Round Table, having stoked the discussion with his experience and adding fuel by way of eliciting ideas and experiences of others. There’s no quick formula but the session did throw up some easy mantras to achieve those Global ambitions…

Some interesting takeaways from this session :

TEAM:

–       Hiring for overseas is always a challenge and you can’t be careful enough

–       Get a co-founder with a sufficiently high stake in the game, and one who is ready to adapt to the call of the hour.

–       If you know the person from earlier, nothing like it

–       Stay away from expensive consultants and retainers. Find someone who will take less cash (and therefore has had a prior successful exit / financially secure)

–       Write down the issues, objectives, compensation, way things are done, who does what, 5 year vision, etc. These discussions need to happen 

Experiences of those present:

–       One of the RT participant founders even camped in the US for 3 months to find the right guy, interviewing over 15 persons identified through various contacts. They evaluated trust, skill and cultural fit before deciding.

–       Most people do not want to be the lone member of startup in the US because all decision making would happen in India. One of them had a member already selling remotely so were thinking of moving that person to US.

–       If there are 3-4 co founders, there is enough mental bandwidth to get one person to US for 6 months to set things up.

–       Get partners to sell for you, they front end and sift thru the leads. May be encourage one of the partners to join you, as did one entrepreneur who had a good partner in E&Y front ending and finally robbed E&Y to get his co-founder !

–       In a nutshell, don’t compromise on this first hire. 

PREPARED TO TAKE THE FLIGHT ?

–       Start selling globally only if you can fund the sales cost for at least a year

–       It’s ok to do some services revenue to generate some cash. But this is also the biggest pitfall, if you end up doing too much customization that cripples you later. 

Key considerations:

–       You have to learn how to sell if you don’t already. Thumb rule is – if you can’t sell your product, nobody can.

–       You should have a sufficient funnel and regular flow of enquiry / conversion / sales and cash flows. Ok that’s a lot to ask but then that’s what it needs !

–       Prepare the Sales play book. A new person cannot invent the playbook to sell in US for you. 

PRODUCT MANAGEMENT

–       Do you want to keep Product Management close to the customer or close to the R&D team?

–       Typical challenges in this are the ability to be aligned. Clear internal communication is crucial in motivating the team for the higher purpose

–       Delivery teams are usually in India, however you need to deal with the challenges of motivating team from a distance and account for cultural differences

The practical Product Manager:

–       Understanding the higher purpose and communicating it again and again is very important. If engineers are in the same office as sales guys then its easy, motivation happens. But if teams are physically separated then you have to build the channel to keep that communication going.

–       Communicate back to sales what problems engineering is facing.

–       Product Manager must have a regular travel plan and must meet customers if working at a distance from the market. This is crucial to get the alignment early on.

–       The PM cannot be note taker, taking customer requirements and giving it back verbatim to engineering to build. He must understand, negotiate and make intelligent distinction between features and requirements.

–       Priorities should be clearly published in writing.

–       Engineers should have the freedom to think and push back on features, but within boundaries. That’s when they can understand the purpose vs just coding.

–       Engineers must have first hand communication with customers, go for customer meetings, handle support calls etc.

–       When hiring engineers, set the expectation upfront that you have to do everything, and even learn outside your core competence. A Startup cannot afford to have people rigid within their own area. 

MARKETING

–       The biggest conundrum is in expectation mismatch, US teams being very “look” orinted and India teams being “fact” oriented

–       Interpretation of specs is usually different for each team, and quality of collateral needs to be extremely high to appeal to a US audience

–       The simple approach is to keep everything that requires a “handshake”, in the US and to teach India teams to be perfectionists.

–       If you need to get copywriting, don’t even think of getting it done in India. The lingo, the flow has to be completely American – leave that to an American.

–       Use a professional UX design shop if you need to

–       Use professional agencies for PR, like PRWEB, etc. 

SALES

–       Necessarily should be close to the customer. If the product requires a handshake, then you definitely need a US team member.

–       At the very least you need someone to stay up at night and receive calls

–       Prospecting via Linkedin, using polls and doing cold calling from India are usually successful approaches 

Sales and Marketing in the US is a big discussion in itself. A lot was left to be discussed, perhaps deserving an entire session devoted to selling in the US market. Another day, another Round Table then. 

ProductNation is the Go-To destination for many a successful software product. There are several amongst us who have tasted success in the global market. Do share your experience right here.

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Top 10 things to look for a digital marketing roadmap.

Today the biggest challenge for any of us as entrepreneurs is not to build kickass products or services but to reach out to the relevant target audience. Many of products fail not because they were not awesome but because of poor marketing strategies. I have myself made terrible mistakes which costed me and my company a lot but it’s just part of a learning experience and entrepreneurial curve. Lot of people think digital marketing or social media marketing is free or easy but I fell it’s the make or break for any company whose customers are online. It needs the same amount of attention and effort you had put in while building your product / services. It needs a lot of thinking, prioritization, knowledge and off course a lot time investment. Today there is so much noise on digital mediums that you need to be remarkable to stand out or youwill be just one out of many. Here are my top 10 learnings from the many digital campaigns I ran.

  1. Map your efforts to the end goal: Most of the time startups do not have a clear end goal in mind and they map the entire campaign to a wrong goal. What is you end goal? Drive traffic? What is your KPI which will make you successful this quarter? Does your organization’s goal is to drive sales or build user base for this quarter. Once you decide on your KPI for this quarter do not change it. Stick to it. Do everything to achieve your goals, tweak strategy to achieve it but not the goals.
  2. Don’t be scared of spending: Most of the digital campaigns are bound to fail. Just that one of your campaigns failed doesn’t mean that platform is not good for you. It just takes a fair amount of money and time to optimize your campaigns and make them successful. I have typically spend around 2Cr. on Facebook platform in last 4 years and still may of my campaigns fail today. If you want fast results hire an expert of the platform.
  3. Don’t put all your eggs in one basket: Diversify your mediums to generate leads or traffic. Typically any medium should not drive more than 20% of your sales. It becomes really lucrative to go deeper and deeper into a medium when we taste success on it. I have learnt this hard way. There was time when Thrillophilia was driving 80% of the traffic through Search engines and then suddenly the website was hacked by Chinese hacker who did lot of artificial link building. We realized this 3 months later when we got penalized by Google and traffic dropped to 1/10. We had a nightmare on sales side and had to diversify in hurry which really isn’t the best approach.
  4. Build smart email lists: Emails are still going to exist for next 10 years so it’s a good idea to invest on them. The more you know your customers, what they want and better segregated your email lists are, the lesser you will spam your consumer and the more leads you will generate. Keep a close eye on subscription/ unsubscribing and see what drives them.
  5. UI is the key: Drive emotions. Lot of impulsive buying happens over internet. People get carried away with emotions, drive them to do what you really wanted them to do. A good visual can be 5 times more powerful than an average one. No other thing can have such an effect on your campaigns. I again say drive emotions. It can be anger, humor, inquisitiveness etc.
  6. Have a short term strategy and a long term strategy: Your short term strategy could be have a good user base to feed your platform or generate leads to feed your sales team. Paid advertising might be really helpful in doing that. Your long term strategy should be to build a sustainable long term engine based on active user base, repeat customers, reviews or organic traffic.
  7. FANS and no fans: When I talk to many startup friends they ask for tips of building fan base seeing that we at Thrillophilia have done a good job in building a 32000+ Fan base on Facebook. It’s just the most false metrics to look at. We have never ever done a single campaign to increase our Fanbase. It’s not going to take you anywhere unless you plan to sell your company to a not so tech guy. A better metrics could be active users on page, virality of posts or traffic on website from Facebook.
  8. Keep a close eye on 24 hour results: It’s very imp to know what the world is thinking about your company at this point of time. I am just addicted to 24 hour results of keyword “Thrillophilia” on Google. A simple way to do it is go to Google and type in your brand name. In Search tools select in “Past 24 hours” This will show you the results of your brand in the last 24 hours over net indexed by Google. It will help you to identify if some is talking negative about your brand or if you just had a fake review from a competitor. Also set you your key Google alerts.
  9. Lessen up the dependency on other platforms: Let’s say today your 80% of the traffic is driven by Google and Facebook. How can you bring it to 50%? Building better email lists, having more repeat traffic, people who love you and are addicted to your website, affiliates etc. You never know if Google of FB will exist after 5 years but I assume you are building a company that probably will.
  10. Build relationships: Nothing works better than this. Start helping people in your ecosystem. If you design T-shirts design it for free for a NGO, a startup or for a big company. If you run a blog, give links to other good websites. Take your vendors for a dinner. Soon your 24 hours result will start getting better. We recently did a camp for Make a Difference, and yesterday they posted a Video on Youtube with our special mention – Let people talk good about you and enjoy the ride. In the end you were here to disrupt something and build something better.
Guest Post by Abhishek, Co-Founder of Thrillophilia.com, the biggest activity travel website of India and comes with 6+ years of digital marketing experience. Before Co-Founding Thrillophilia he has helped national and international companies like Biocon, Flying machine, Discovery Channel to build their digital marketing presence