iSPIRT works to transform India into a hub for new generation software products, by addressing crucial government policy, creating market catalysts and grow the maturity of product entrepreneurs. Welcome to the Official Insights!
It’s here! The India Internet Day(a TiE event) celebration is beginning, and you’re all a part of it. You may be an outelier, an insider, a veteran, an investor, a trend spotter, an experimentor or an industry driver, but this is your go-to event this year.
Why? We’re looking at the long-term horizon and paradigm shifts in the internet industry globally and translating that in the Indian context. We will debate and discuss strategic drivers of the industry and will attract the top players.
Eight Indian startups get their “4 minutes of fame” at the event – an unprecedented happening. No wonder that when we opened the call for applications, we received more than 55 of them.
The competition was tight, and the job of the jury was not easy. The jury – Rajiv Prakash(Next in Advisory Partners , Saumya Meattle (ModuleOne), Srikant Sastri (Vivaki), Vivek Agarwal (Liqvid eLearning) and Vimalendu Verma (Magic Software) – rated the startups on the following parameters: originality, impact, practicability and applicability of the Innovation. After a lot many conversations and debates, 8 companies were shortlisted.
The big question: Will you be there to see the innovations being put forward by these companies? Next year could well be your turn.
Bluegape helps brands in setting up fan merchandising stores. Fan merchandising is ignored by most brands in India and is also a unique way of promotion for brands.
Cite Communitiesis an open online community for management professionals and serves more than 28 lakh people worldwide. The community offers a free-to-use knowledgebase with a discussion forum. This is where professionals can share career-related queries, which are answered by experts and mentors. The trump card? Anonymity.
Dineout is a table reservation website that enables customers to book a table, online and on the phone, at their favourite restaurants in town. It provides fantastic discounts – something not on offer if customers go to a restaurant directly.
Huntshire helps solve the problem of finding the right talent in a given time frame. Right now, companies must post vacancies on job websites and wait for 30 days to get maximum applications. Post this, the candidates are screened. The entire process takes 30-45 days. Huntshire does all this in 3 days, eliminating the need for a two-step process.
PerfectMyEnglish is a Web and Mobile App enabling tangible improvements in English communication skills for students and professionals. They offer personalised mentorship, detailed analytics, spoken English skill remediation through VoIP services and end-to-end solutions, helping businesses and recruiters achieve key English training and assessment objectives.
NowFloats: With 850M mobile phones (over 90 per cent feature phones) and SMS being a pervasive technology, NowFloats enables creation and updating of websites through SMS for small and medium businesses in India. Smartphone owners can use mobile Apps.
MindHelix:Sentinel is the first app designed with women’s security in mind. The app can send instant alerts in case of any problems. A forced power-off of the phone or an improper exit of the application will trigger an alert to be sent. Prolonged signal loss will also cause a ‘fail safe’ alert SMS and email to be sent from the company’s server.
Mobile Harvest is a two-way oral and intuitive literacy neutral community and networking platform, much like an oral Wikipedia for our emerging billion. It attempts to bring the benefits of social media to people who are not comfortable with reading or writing.
Ashok was perturbed. In Jan 2006, an eastern European company had taken his source code, made minor changes and started selling it under an alternate brand name at a reduced price. Ashok’s company Chartengo was a pioneer in Adobe Flash based charting software that helped users create charts for data visualization. Its charts were perceptibly superior to any available on the market. The company had five employees and revenues of $500,000 in 2006. It used to offer source code with its USD 99 developer version of the product. A growing business like Chartengo was sandwiched between free libraries on the Internet and large data visualization vendors (revenues > $100 million) on the other. In between it also had to content with few hundreds of competitors. The possibility of a vendor infringing on Chartengo IP in some distant corner of the globe was high.
Chartengo did not have a legal team so they contacted a firm that specialised in copyright infringements. The firm quoted $250,000 to file a suit but there would be additional fees for court appearances. besides the unaffordable legal fees, Ashok was apprehensive about the stance an eastern European court would take in this matter. He decided to forego the legal route. He talked to development team and few experts outside. A surprise suggestion with overwhelming majority was – make your product code open source. They said open source code will make it difficult for infringers to compete. Why should customers pay for a code that is open source from the original vendor? Ashok’s team of developers was thrilled with the idea of open sourcing their code. It would accelerate innovation and save them time developing everything themselves. They felt perhaps the customers would also be happy. They could also see an opportunity for higher revenues. The open source would probably draw more customers, especially those who were sceptic of dealing with a small company like Chartengo.
Ashok had so far found it the best strategy to protect its intellectual property. He believed innovation would only happen if it could be exploited for exclusive financial benefits of the innovator. How could he even think of handing over his crown jewels to the infringers in the marketplace? The thought of handing over his IP to these hackers and letting them enter their random untested code into it thus contaminating its pure quality was appalling to Ashok. He clearly saw his competitive advantage evaporating with opening his source code. Yet, at that time, open source was rising like a tsunami? Apart from individuals hacking into your code, well-funded companies were also doing so. There was passion about open source. Even customers were enamoured by open source culture. It was turning into a religion.
BSB is a start-up funded by Bharti & SoftBank building mobile products for the Indian market. Hike is a messaging app which allows instant messaging and group chat on your phone with friends who have Hike, as well as those who don’t have Hike. We caught up with BSB’s head of products and strategy, Kavin Bharti Mittal (KBM), to talk about Hike, right before he was getting ready to launch Hike 2.0, a major update to the messaging app.
Introduction
Hike is a pure Made-in-India product. BSB is based out of Gurgaon, and the product was built from scratch by this team. Under the guidance of KBM, who is also the resident UX guru, the team brought out a beautiful and highly functional product in Dec, 2012 when the team size was 15. They are 30+ now, and furiously working on next set of features, supporting users and handling the success!
Product Highlights
The product has been designed from grounds-up by Hike team.
The design is beautiful and minimalist.
They chose a more efficient protocol for communication (MQTT, which is less chatty than the better-known and more-often used XMPP).
In India, Hike allows its users to message to non-Hike users by converting Hike message into an SMS (each user is given 100 free SMS every month). This is a key differentiator for Hike, in addition to a cool and modern design.
Product Development
Following an agile development model, they schedule a release every 4 weeks with a stop gap release for performance and related fixes in the middle if need be. Such a schedule ensures that they are not hitting the users with too many changes too often, and still stay responsive to market feedback.
KBM controls the product UX and works with his designers to create detailed wireframes and mockups before engineering starts working.
They have a very product-focused culture and so engineering-design conflicts are minimal as everyone understands the need for a great design and works hard for it.
They work on multiple platforms in parallel, so lessons learned on one platform are quickly incorporated into other platforms in the same release cycle.
Product Strategy
Beautifully designed product – Made-in-India products are not known for good designs. Hike is a notable exception and this will help it gain ground quickly.
Messaging Hub – In the world of Facebook and Twitter, there is a huge amount of information generated and consumed by people, causing information overload. Hike aims to cut this clutter and allow you to create a closed network of friends with whom you share right amount of information. This is a good differentiation strategy.
Close partnership with carriers – With smartphone penetration going up all over the world and cheap smartphones being available, messaging applications are well-positioned to kill SMS (and jeopardize a large portion of carrier revenue). Hike can offer opportunities to carriers to offer value-added services and retain (and enhance) that revenue.
Adoption
The messaging app space is very crowded (WhatsApp, Facebook Chat, WeChat, Nimbuzz , etc.) and Hike is a late entrant to the party. Still it has created considerable buzz in the market and have some impressive numbers to show.
In 4 months since the launch (they launched on 12/12/12), they have crossed 5M users (adoption is measured by # of active users – sending at least 1 message a day) and growing fast!
Over 50% of their users use hike2SMS feature, which is a key differentiator for them
They have used rewards (Talk-time rewards, ended now) and incentives (50 free SMS for each successful invite) to good effect to create good buzz. However, as KBM says, buzz and going viral work only when you provide a good value to the users. Hike 2.0 is expected to bring in lots of features.
Using digital channels for marketing and support very well: Blog, support site, Facebook page and twitter handles (@hikeapp and @hikesupport) are all well used by users and well-responded by Hike team.
Hike 2.0 and beyond
On Apr 17, BSB announced Hike 2.0, a significant release which introduces ‘circle of friends’ notion and many other features. With Hike 2.0, you can now create a circle of friends (consisting of your close friends), post status and mood updates to them, and review their recent updates. This is similar to Facebook’s Improved Friend Lists and Google + . Read the announcement for full list of Hike 2.0 new features and enhancements.
‘Status updates’ are asynchronous models of communication (you don’t expect your friends to read and respond immediately, though this Facebook generation usually does!) while messaging is supposed to be synchronous – you engage in conversation in real-time and expect a response. With 2.0 release, Hike is positioning itself as the ‘messaging hub’ for mobile-first crowd, and taking a ‘closed group, more engagement’ approach (as opposed to ‘everyone reads everything about me’ philosophy). While this might pit it against Facebook and G+ in terms of functionality, I think this is good strategy going forward to capture mindshare of an audience who is a public enough to chat with anyone, but private enough to need the solace of ‘circle of friends’. This also attracts users like me who prefer private and deep conversations and shun messaging apps because of its openness.
As Hike grows beyond the feature-functionality debate, it needs to give more focus on back-end: messaging is critical for its audience and disruptions caused by planned maintenance or rush to get new release must be avoided at all costs.
The Road Ahead
My address book contains my US, China and India friends which add up to about 400 contacts. When I installed Hike on my phone (Nokia 710), I found hardly 5 friends who were on Hike (Hike looks for those who are on Hike and adds to your friend list). I did the same for WhatsApp, and I saw 80% of my contacts show up as using WhatsApp, including some of the people I didn’t think were in the target segment of messaging apps!
Hike has a long way to go, but I think they have started with the right product and are travelling in the right direction. May the force be with them!
When nearly two dozen product enthusiasts sit around a table passionately talking for 4-½ hours, expertly addressed by two product veterans – Amit Somani and Amit Ranjan, you can expect an information overload. And, it did seem like drinking from the firehose, trying to capture all the takeaways in the intense back and forth, where even a tea-break seemed imposed. A blast it was – this iSPIRT Playbook Roundtable Delhi edition on “Effective Product Mgmt & Delivery”, focused around learning for startups.
[This was the NCR session on Apr 13th. Initiated, as part of iSPIRT, by Avinash Raghava, and very ably facilitated & supported by Aneesh Reddy. Great facility and great Food by Eko Financials. Thanks guys, Awesome effort!!!]
iSPIRT Playbook Roundtable in Delhi (Click to see all on Flickr)
Thankfully, there was a structure, laid out initially across specific dimensions – Product Planning, Delivering, Hiring, Culture, Metrics, Customer. These themes kept repeating through the session with questions coming from participants across the breadth & depth of product management, and many times touching upon all the aspects of running a product company.
Here’s an attempt to sum up the takeaways from this long & exhaustive (not exhausting, yet!) session.
Planning & Delivering the Product
– Product Planning in many start-ups is not an elaborate exercise. It is typically handled by one of the founders, and “build and adapt as you go” is the norm.
– Delivering a great product is always an intersection of Engineering, Design and Product Management, with Product team in the driver’s seat. This intersection and collaboration is one of the critical factors in getting a great product delivered.
– Getting the Engineers and Designers to collaborate is one of the key challenges. As per Amit R, what helped them at Slideshare was the fact that they always hired Engineers with a flair for Design. A great developer as part of the product team is 70% Engineer & 30% Designer, as per him.
Product Metrics
Amit S emphasized that metrics are very important for product managers. When the team grows (when you can no longer rely on people to just talk to each other and get things done), the metrics-driven product management becomes critical. Touching upon the right hiring in this context, Amit S insists on covering the candidate’s thought process around metrics (with open questions such as – what would be your primary metric if you were designing the Delhi metro).
Metrics & the Rule of 1/1/1: This is one rule around metric that Amit S follows. What will be your metric for 1 Week, 1 Month, & 1 Year. Break it down, with crystal clarity and follow it up religiously. (A great resource for B2C space around metrics is a presentation by Dave McCleor – Startup Metrics for Pirates).
Some learning around Metrics:
– It is important to be clear of the vision, and how it connects to the primary metrics that you define. There’s a direct correspondence between identification of the key metric and the clarity of what the product is trying to achieve.
– Relevance of the metrics to the specific goals through the product journey is important. As one goes along in the product journey, the dimensions on which key metrics are identified may vary. Initially it may be customer acquisition; And then it may be engagement; then conversion; retention; life-time value; and so on.
Customers
One of the key questions around customer aspect of product management is – What is the right spec for the product? One of the biggest mistakes product managers tend to make, as per Amit S, is when they confuse the “Customer Requirements” with the “Product Requirements”! Sorting this out is the core to the responsibility of a Product Manager.
Some of the tips & tricks around Product Specs:
– When faced with a requirement, the first pass criterion (in B2B scenario) should be – if the requirement is relevant to at least 3 customers.
– There are various tools to interact with customers, and get feedback: Surveys, Net Promoter Scoring, Feedback through the product interfaces, and so on.
– Get the Information from Customers, Tone it down, Tune it further, and then arrive at the specs for “Engineering”.
– What should the spec typically look like? Default Rule of Thumb – 1 Page Spec. It should be very focused, very clear, in what the feature is trying to achieve, and at the same time not too long.
– A Good quality spec considers the “Least Granularity of time” with Clarity of thought. That’s from the Project Management perspective. From the functional perspective, Amazon has a good model that can be followed. Every Spec at Amazon is a 6-Pager Document – forcing people to establish clarity of thought and articulation.
– Another good alternative is the 1 Pager “Lean Canvas” by Al Ries.
– It’s also important to be clear on “What” requires a spec and What doesn’t. Both at Slideshare and MakeMyTrip, the team goes through multiple “Lights-on” stuff that they need to perform to keep the business running on routine basis. And these are fast-track enhancements and modifications driven by immediate business needs and marketing requirements. The Lights-on requirements are different from Core Functional Specs for the product roadmap.
– Another criteria that decides how detailed the spec should be is based on the number of users getting impacted.
– How do you handle customer requests with investment requirements that are not justifiable on the ROI? There are multiple considerations to this. The “Life-time Value” of the customer is important, and if such investments allow you to enhance it and calculate ROI in longer term benefits, it may still work well. There are alternative ways to look at this though. In the experience of Aneesh at Capillary, they had divergent requests that led to a very different direction for the Product and transformed it from “Mobile CRM” to “Intelligent CRM”. Another possibility could be to look at partner ecosystem and see if there’s a synergetic way to address these needs.
– How do you manage your customer requirements into “Not to have” features? How do you single out the noise? While it is nice to think of an ideal situation of getting the product requirements at the planning stage, when the customers use the product, they often come back with plenty of views that need to be funneled down. When you have to discard some requirements, it is important to “talk to a lot of people” to ensure weight. Also, some of the requirements die-down on their own, clearly indicating noise factor. It is a balancing exercise between reducing the hassles in customer feedback process and creating enough friction to dampen the noisy “Vocal Minority” (the term that Amit R uses to refer to the few customers that may be so noisy that their voice seems more important than is worthwhile for the product).
Hiring and Product Management Structure
As per Amit R, Product Managers should be (are!) Second-in-command in the sense that they decide the future of the company. Considering this, it is critical that one single product dimension doesn’t overweigh the hiring process. So, intake process for Product Managers needs to follow the 70% rule – The Product Managers need to be aware on all the broader and holistic dimensions of running the product business including sales, marketing, operations, design, and so on, with 30% depth on the critical Product Management areas.
Some of the specific tips on this from Amit S and Amit R, and some from participants:
– Determine if the candidate can think holistically and de-clutter the thought process in the crowded set of inputs. Ability to deal with ambiguity.
– Product management is typically a “common-sensical” thing. Look for common sense and intuitive angle.
– A great product manager would do well on what can be referred bluntly as “dhandha” (Money part of the busines). You cannot afford to have a Great product with “no” money.
– One of the participant companies built their structure around Customer Success. Majority of the Product roadmap is driven by the Customer Operations, Tickets, and resolutions – and driven by how customers used and viewed the product in B2B scenario. In such cases, they typically found it useful to move folks from Customer Success team into the Product Management areas.
– In case of another successful participant company, the CTO is playing the role of Product Manager and it is working very well for them.
On the relationship between the CEO/Founder and Product Managers. As per Amit S, Product Manager is the CEO of the Product, while the CEO is (of course) the CEO of the Business. One of the challenges for the Founders is how quickly they are able to let go he Product Management and start focusing on the business and Product metrics. Amit R also emphasized that it can work cleanly with the CEO focusing on the business aspects while Product Manager focused on the Product aspects while maintaining the alignment.
Where should the Product Manager Report? At high level one case say that it depends on where you are in the evolution of the product/company, and what the Product really means to the vision of the company. However, over time, Product Management needs to be separated from Marketing and Engineering. In essence, Product Manager shouldn’t report to the Engineering or Sales or Marketing. In corollary, there should not be a reporting into Product Manager as well. Product Manager is a “Glue” job, and is key to a healthy tension for the product direction.
Product Manager is WHAT of the Product – Defines what (functionally) should be built. Engineering is HOW and WHEN of the Product – Details out & manages “How” (technically) and “When” (schedule-wise) should the stuff be built.
One needs to also establish clarity on Product Management being different from typical Project Management. Also, there are strategic aspects of product that are owned by the executive management, however, you always need a “Champion” of the product that is independent of the other forces that drive the organization.
Importance of Data Guy! Another structural aspect that Amit R emphasized on (multiple times!) was the importance of a “Data” person in the Product Team. This role is almost as important as a Product Manager in the sense that Data & Analytics can play a key role in the product Roadmap definition. There are various flavors of the Data – Dashboards and reporting, Product Management level Metrics, Decision Science, for instance. Interesting to note is the fact that at LinkedIn, next set of products are heavily influenced by “Decision Scientists”. (Cue References: Hal R Varian, Chief Economist at Google and DJ Patil)
While there was a whole lot of structure to these discussions, we had some extremely valuable side discussions that link back to the Product Management, and very important to address. Here are some! 🙂
Positioning. For a clear direction for Product Management, the positioning of the product in the market is a key factor. How do you refer to the product? The answer to this question, in case of start-ups, seemed unanimous that the start-ups are too limited in resources/focus/energy to be able to create a new category. Aligning to an existing category with a differentiator is the key to early success. For instance, Slideshare referred to itself as “Youtube of presentations”, Vatika positioned itself as Parachute with Additional ingredients, “Busy” positioned itself as Tally with better inventory management and statutory reporting.
(Positioning is an important theme and comes with lot of related broader areas for considerations for Product Companies. We will have a round-table specifically around Positioning in near term)
What’s a Product? (A rudimentary question, I know! But worthwhile to hear the perspectives! J) How do you differentiate functional Product Management from the technical side of it? As per Amit R, “Product is the core experience or core touch-point for your end-consumers with your business.” It is worthwhile to note that the various types of customers may have different ways to access the product and there may be different ways to define the touch-points for every segment. For instance, Slideshare follows a Freemium model where 5% of the Paying customers may have a different set of touch-point experience from the rest of 95% free users. So various segments, such as Free B2C, Paying B2C, Paying B2B, and Partner B2B may all have different touch points with the same Product.
How do you get the Product Managers to champion the cause of usability and aesthetics? As per Amit R, in case of Slideshare, CEO happens to be from the usability background and that helped a great deal, since the thought process permeates across. It is important to engrain the usability in the way of the product management, since you cannot bolt it later, as per Amit S. There are various ways MakeMyTrip tries to do that. One of the eureka moments, for instance, for Engineers and developers was when they were shown a “live session” of a user through the Screen capture tool. It also helps to have the live user sessions in front of the product team. Some of these approaches can build that appreciation for the user actions in the minds of product team, over time with sustained effort.
Retention and Customer Lock-in: Slideshare has learned the harder way that ignoring Emails as a mechanism for customer engagement and retention is costly. LinkedIn relies on Email based “Customer retention” and “Returning Users”. Jeevansathi.com uses a strategy to map the customers in various life-stages and uses various Email and SMS templates to engage them even through the very short life-time of 3-4 months.
The Mobile Storm: As per Amit S, having a Mobile Strategy through this year and next year is critical for the product companies. Web is no more the only option, and for some products, it is becoming a mere secondary. Mobile First makes sense. The transactional figures for Mobile are increasing at such a rapid pace, that an afterthought based Mobile based functionality may not work so well.
If this is any indication of the things to come, the product ecosystem will benefit immensely from the initiative. Looking forward to the furutre editions, and share more!
Avinash Raghava, who is doing a wonderful job of getting product start-ups together all over India, organized a product management roundtable with the help of Aneesh Reddy(CEO, Capillary). They invited Amit Ranjan (Cofounder, Slideshare – acquired by LinkedIn) and Amit Somani (Chief Product Officer, Makemytrip, ex-Google) to share their insights with a small set of entrepreneurs.
Credit for all the good stuff goes to Amit Ranjan, Amit Somani and Aneesh Reddy. Notes are rough. If anything is unclear, feel free to comment.
Here are some quick notes/thoughts from the event:
Who would make a good product manager?
Someone who can do 70% of everything (coding, design, listening to users etc.)
Best way to find a product manager in India is to find someone who did a startup but failed – he/she is likely to know all the various aspects that go into managing a product.
Someone who can lead by influence and manage to juggle all the balls in the air. Should be someone who can say NO.
It’s a very tough position to hire for – you need to have patience – you might go wrong the first few times. Once hired, give them around 5-6 months to get the hang of the whole thing.
What does a product manager do? What is his role about?
A good product manager would understand the requirements from various constituents and write a detailed specification, plan for bugs, testing, urgent requests and then create a product roadmap/deadlines.
A product manager has to identify and write down what metrics will move once the product is launched (e.g launching the mobile app will increase our repeat orders by 9%) – in some cases it is just to ensure that people work on things that matter but overtime it also brings more accountability.
Engineers tend to underestimate the time it’ll take – product manager needs to be able to correctly estimate how long something should take. And you will get better at it with time.
Use the 1/1/1 rule – sit with the engineering team and plan what needs to be accomplished in 1 week, 1 month and 1 six-month period.
People want to see the product roadmap – it is important for the CEO / Product Manager to communicate this to their team mates since a lot of people feel uncomfortable if they don’t have a clear idea of where the product is headed. (Amit Ranjan mentioned that people may even leave if they feel that the founding team does not have a clear vision – but the nature of start-ups is such that it is bound to happen that the product roadmap keeps evolving)
You need to hire coders who have a design sense (that eliminates 70% of work later).
Role of special data or analytics person has become very important (Amit Ranjan said that he could see that products of the future will be decided and influenced by data scientists). It is very important to get such a person on board early. Someone who has crunched SQL and nosql logs etc and can find trends and look up aberrations. Read up on Hal Varian and DJ Patil to understand more about this.
Difference between customer requirements and product requirements – customer requirement only becomes product requirement when more than 3 people require it (it’s a rule of thumb) – (People shared various tricks they use to ensure that the customer requirement is serious – “just wait for a few days and see if they come back with the same request”, “ask them to email it and not take feedback over the phone” etc. – these are situations where there is too much feedback coming your way. In most cases, it is best to make it as easy as possible for people to give you feedback).
Keep product engineering teams small – Amit Somani mentioned Jeff Bezos Two Pizza rule i.e. if the team cannot be fed by two pizzas alone, it is too big. Read more here.
Try to do daily scrum – gives everyone a sense of what everyone else is doing and ensures that people are making progress
Everything is a 6 page document – another Jeff Bezos funda for getting clarity. So a specification or a product request could be a 6 page long form document which ensures that the person achieves clarity before building anything.
You need to benchmark your product against other products especially in enterprise. When starting a product from scratch this can be a really useful exercise.
Amit Somani suggested a mental trick – before building a product, write a one page press release for the product that comes out upon product launch – what will this press release have? What the key features? The target audience etc. This PR drafting exercise could help you decide what to build, what is critical, and for which audience.
Don’t ignore email as a channel for activation and returning visitors
Product activation – Use banners on your own website – do get them to take action – on landing page – on other parts of the website
Track at your mobile traffic – people at the roundtable reported some crazy growth numbers for mobile internet usage – huge sites are now getting 20% to 60% of their traffic on mobile. Mobile traffic is split 50%-50% on mobile browser (including WAP) and mobile apps. This was a big eye opener for many people.
Tools people recommended
Use Trello (a Joel Spolsky product) to manage your product
Use Zapier business tool to connect various sources of product input (e.g. taking Zendesk tickets and automatically creating Github issues)
Use Clicktale or Inspectlet to record user sessions
Use Morae for recording users’ reactions when they are using your product ((Amit Somani mentioned how they put a live usage recording on a LCD screen in the technology room so that engineers could understand how their products were being used – it lead to a lot “can’t he just click on the button! Why is he scrolling up and down!”). One way to get users for such recordings is to ask interview candidates who come to your office to use your product and see their reactions.
Use a call-outs software when introducing new product features (like Cleartrip / WordPress / Facebook do).
Concluding notes
This was one of the most gyan-heavy sessions that I’ve attended. It was useful to hear things from people who had been there done that. Aneesh (even though he is based out of Bangalore) had taken the lead to do this with Avinash and our hope is that the group meets every 6 weeks to keep the conversation going. We’ll keep you posted.
Feel free to email me at ankur AT Akosha dot com if you’d like me to give more details to you.
On a related note, there was some basic debate about what a “product” is. We didn’t get into it at length because everyone in the room intuitively understood what a “product” was. However, we had internally debated about it – if you are interested, do read –Understanding Product v. Service [ThinkLabs Notes 1].
A year back I was involved with a leading mobile apps company on an issue related to product pricing. The company developed customized mobile apps for business. At the time it had a staff of 20 programmers and reasonably successful – having on its customer list several top global corporations like cola companies, few leading banks, advertising giants and others. It had revenues close to USD 1 million. The company had identified 20+ software functions (routines) that were commonly used in most mobile apps. They had put these together into a single library that programmers could access from a central repository when working on a mobile app project. Examples of such routines included memory management, real-time authentication, camera control, text messaging within the app and so on. Use of this central repository of frequently used routines had resulted in 30% saving in programmer time, standardization and uniform quality across projects, shorter time to market and finally the monetary benefit.
The company saw a window of opportunity externally. They knew the mobile app business was growing at a fast clip with app vendors mushrooming all over. They were also aware of the trend of end customers developing mission critical apps internally. Both these customer segments would see a value proposition in the library if the company offered it. The company was at a critical point – thinking how to breach the psychological revenue barrier of USD 1 million. It faced fierce competition that had brought down margins from 80% to 25% in just two years. They thought the library was a ticket to new profit stream and improved competitive position. They were debating how to price and market the product.
However this meant a sea-change in the way the company thought and worked. So far, they delivered single project as per known customer requirements to a single known customer at fixed price. They did their best to deliver within time and budget. They priced their services at cost plus margin. Any delay ate into their margin. Selling the tool externally would involve selling a generic product to external customers whose size and number was unknown and uncertain. They had a hunch but did not know for sure the external customers would really see value in the offering. For example a tribe of software programmers take pride in and get thrill from solving tough problems. They would not care for such a product. A few team members even felt that their competitors would also acquire the library thus diluting company’s competitive advantage in the market.
The company sought answers to several questions:
1. Should they sell the library externally at all?
2. Should they price it on cost plus basis or some other method e.g., value based pricing?
3. What should be the list price of the product?
4. What should be the license structure i.e., kind of licenses they should offer?
The company made a set of decisions. I will share those in the next post. Meanwhile, I invite you to share your suggestions on the questions facing the company.
Enterprise as well as Consumer Software is moving fast towards a Software As A Service (SaaS) model. Who would not like paying a per user, per month charge as opposed to doling out huge amounts of money for licenses upfront and paying 16 to 20% Annual Maintenance Charges year after year! But the short history of SaaS companies is already full of companies that grew too quickly, or chose the wrong pricing or customer acquisition strategies, ran out of money and had to go out of business! The same revenue model for a SaaS product business can also become its Achilles Heel if it is not understood and managed properly!
Understanding SaaS Revenue Models in all their glory is key to building a sane, reliable and successful way to build a product company. There are a few venture capital companies that have had lots of practical experience building successful SaaS companies and can share with you a lot more detail. Like Matrix Partners’ David Skok who has written almost a thesis on SaaS economics – here is a sample – The Saas Business Model – Drivers and Metrics. David has partnered with HubSpot and NetSuite for all of this exploration and they must know what they are talking about! Other good references are Doubling SaaS Revenue by Changing the Pricing Model and SaaS Revenue Modeling: Details of the 7 Revenue Streams.
But for a start, here are 5 essentials of SaaS revenue and pricing models a product startup needs to remember for success:
1. Monthly Recurring Revenues Vs. Getting them to pay Annually: Get your customers to pay annually if you could (depending on the nature of your product – enterprise or consumer facing). It’s a hassle for them and you to process these invoices every month and follow up on late payments, etc. It has a clear effect on the cash flow. Plus you may not have to worry about churn that much since they are not making that decision to pay you month after month where they could pause and decide to churn! If Annual billling does not work, try at least a quarter at a time. It may not be worth all the processing time doing it month after month.
2. Churn and Negative Churn: Churn is the periodic turnover of your customers. Companies mentioned above have found that about 2.5% to 3% churn is OK. You need to be concerned if it goes beyond that. However with Up-selling and Cross-selling, you can actually make it positive churn too! This is when the marketing funnel that becomes narrow from the top becomes broader again with upselling and cross-selling. Which brings us to discussing more of the shape of the Marketing Funnel when it comes to SaaS Vs. non-SaaS product companies!
3. Marketing Funnel Economics:
The marketing funnel on the left shows a typical one for non-SaaS product companies. The one on the right shows the one for SaaS product companies. The main difference is the top of the funnel is much wider and uses organic traffic, in-bound marketing, search engine marketing and optimization and prospects from other paid sources.
The relative sizes of the tops of the funnels also show the difference between how wide the top of the funnel needs to be for SaaS product companies!
3. Balancing Customer Acquisition Cost (CAC) vs. Customer Long Term Value (LTV): There are only 8 hours in a day for selling. Traditional licensing models offer an initial large amount in a sale and annual maintenance fees of about 16 to 20% every year after that. SaaS models may offer a smaller initial set up fee and uniform cash flow month after month, year after year after that if you keep the customer. So you need to line up more clients in a SaaS model for reaching the same level of sales as when closing traditional licensing sales deals. So you need to necessarily reduce Customer Acquisition Costs (see the widened top of the marketing funnel in the figure above – that’s what that represents). Some rules of thumb regarding CAC and LTV are that the Long Term Value of the customer needs to be greater than 3 times the Customer Acquisition Cost and the months to recover the Customer Acquisition Cost should be less than 12 months! This also makes a compelling case for designing and developing related products and do some effective cross-selling and up-selling enabling you to realize that Long Term Value even if your CAC is high! Also making sure that you get the Customer Acquisition Cost in less than a year takes care of the problem of churn and if they continue after a year, you have already made your money!
4. Repeatable Sales Model: SaaS product companies rarely can afford the same direct sales model that non-SaaS models do. This is just given the smaller initial sales numbers even though the revenues are recurring rather than an initial large amount and 20% every year after that in maintenance fees in the non-SaaS traditional model. This makes it imperative that the SaaS sales model is easier, quicker and repeatable.
5. Scaling Pricing with Customer Value: Many SaaS product companies shortchange themselves by improving their product so much that they provide much more customer value than they are charging them for. Scaling pricing by clustering value adding features together and packaging them and offering them as upgrade packages is key in ensuring that your pricing keeps up with the value your are providing.
These are only some basics. I highly recommend checking out the references I have earlier in this article. There is a treasure trove of experience and knowledge about how to make it work, all online and free!
In sales, a referral is the key to the door of resistance – Bo Bennett.
In my experience working with Entrepreneurs for the past 9 odd years and possibly have seen a few thousand startups, there is one key attribute that instantly sets apart the startups that just might make it, to the ones that would struggle – the clarity on the problem they are trying to solve.
While we have made it a mandate in events like In50hrs that explaining the problem is crucial, we have realized that as a culture we havent yet learnt the art of observing the issues that around us – especially the ones that present opportunities along with it.
In an effort to help out, we have started collating interesting Problem Statements from entrepreneurs all around. Quite a few have contributed and we are starting to list them at the In50hrs site, as Problems Worth Solving (with due credits).
As a recently read article said, Focus on Talking about the Problems, and not the solutions, its evident that the key to building a thriving ecosystem is by building the capability to spot the problems, but for now, we are giving entrepreneurs a headstart and hopefully a sense of what to look for.
PS: If you want to prototype a solution to any of these problems, do sign up for an In50hrs Near you.
PPS: Want to add a Problem Statement? You can too.
CEO and Co-Founder, Sapience Analytics, Shirish Deodhar, is pleased with the market response to their first software product, Sapience, and says their objective is to become the default standard for Automated Enterprise Effort Visibility and Gain
Sapience Analytics was set up in 2008, as a software products company. It was formed by four serial entrepreneurs, who had come to realize that the future of Indian IT belonged to product ventures and that software services was a commodity business. The team faced the compelling need of stepping into the market of software products. The core product in this case is an award-winning, patent-pending, Sapience, an employee productivity analytics solution that claims to deliver over 20 per cent increase in work output from your existing team. In an interview with ProductNation,Shirish Deodhar talks about the Sapience product journey, its unrivalled position in the market and the company’s future plans.
Why and how did you start Sapience? Why this area of work efficiency? Sapience Analytics has been co-founded by four serial entrepreneurs. By 2008, we had spent 25 years in outsourced product development, including successful exits of previously founded companies. After mentoring a few product companies, one of us, Swati Deodhar, decided to build a solution to address the challenge of measuring and improving productivity.
In mid-2009, we had a prototype with an integrated dashboard displaying software engineering metrics aggregated and analyzed from different tools. This had to do with visibility into the underlying effort of employees and teams as they went about their assigned work.
Absence of work visibility makes it difficult to increase work output, and affects productivity. Contemporary practices of 24×7 work using laptops, flexible office hours, work-from-home (WFH) policies, globally distributed teams, and outsourcing intensify the problem of measurement. Many companies even stop these progressive HR practices in order to improve productivity, just like the recent controversial ban on WFH at Yahoo. We saw an opportunity to benefit the business through greater productivity while encouraging employee friendly policies. The solution also helps employees work smart and improve their work-life balance.
What are your product’s key differentiators?
Sapience helps deliver over 20 percent increase in work output from the existing team without requiring any change in process or additional management overhead. Sapience achieves this through Automated Work Visibility. This is a game-changer for any business, driving over INR 10 million in annual value per 100 employees.
Sapience captures employee work patterns in a highly automated manner with virtually no manual intervention. Agents installed on the individual machines collect user data, and forward it to the central server. Each user gets an individual dashboard, while long term analysis / reporting at business level are available to managers on the central server. Sapience integrates with the customer’s ERP and other systems to enable effort analytics and capacity optimization across all aspects of the business. Customers can opt for Sapience hosted cloud server (SaaS) or an on-premise server.
Besides the revenue/profit gain for the business, here are a few benefits for various stakeholders:
For employees – they can ensure better focus on key activities
Managers – they can guide their teams to work smarter
Senior management get the ‘macro view’ – pointing out which teams are under-utilized
What was the funding strategy to create this product? Time and effort taken to develop it
Once the product concept was validated with some initial installations, we received US $350,000 from the Indian Angel Network in May 2010. Then in November 2011, we received around US $1 million funding from Seed Enterprises.
Who are your competitors? What is the biggest challenge Sapience has faced so far? How did you address that challenge?
Sapience remains the only product available globally that delivers enterprise class automated time/effort analytics. At first glance, some prospects confuse Sapience with employee monitoring tools that have been around for a long time. User time is classified into productive and non-productive work, and aggregated for a pool of employees on weekly and monthly basis.
One of our challenges is to highlight that Sapience does not change corporate culture, but adapts to it. We are addressing this with focused messaging, listening to employee and management feedback from our installations, and building the required capabilities.
What’s been your success mantra in expanding to emerging markets / its reach?
We have been fortunate to have India as a large potential market for Sapience, since it keeps the cost of sales and support low. The product timing has also been good, since productivity at work is becoming a key concern at IT Services companies and for subsidiaries of global MNCs. Since the economic downturn in 2008, revenue growth has declined and billing rates have remained flat or even dropped. Costs have continued to escalate, and profit at IT companies is now taxed.
We were warned that India is considered a very challenging market in which to sell enterprise products, especially for a start-up, and even more so for a ‘Made in India’ product. We encountered the classic innovation curve when selling the products. While everyone liked Sapience, most managers were reluctant to change the status quo in their companies. However, a few bold and innovative leaders recognized the value and signed up as our initial customers. In late 2010, the first release was picked up by companies such as IdeaS (a SAS subsidiary), Excelize, and EnVenture. These were all 75 to 150 user license deals. The next step was to persuade larger 2,500+ employee companies. In mid-2011, senior management at Zensar and KPIT gave Sapience its initial break into the medium sized segment. By early 2012, we got a breakthrough at Tech Mahindra, a leading IT company.
What have been your BIG lessons – personal, professional and otherwise? What lessons would you like to share with someone who is struggling or planning to get into product development?
I wrote a book called ‘From Entrepeneurs to Leaders – Building Billion Dollar Product Companies from India’ that was published by McGraw-Hill in 2010. But the BIG lesson is a very fundamental advice from an ancient Indian text (the Bhagvad Gita): ‘Do your work well for its own sake, without aiming for rewards.’
What inspired you to be an entrepreneur? What lessons would you like to share with someone who is struggling or planning to get into product development?
I did my B-Tech (EE) in 1980, from IIT Bombay. Following a Master’s in the USA, I worked at Burroughs Corporation in Southern California for several years. Got a US patent for the work that I did in my first year of work. I became an entrepreneur by accident when I met someone from the US, who wanted to outsource work to India, and helped co-found my first company, Frontier Software, in 1989. Frontier was a pioneer in outsourced product development, and with product offshoring to India being uncommon then, it took us 10 years to scale to 150 employees. One of our first customers, VERITAS Software (now Symantec Corp.) acquired Frontier in 1999. By 2003, we had scaled VERITAS India to over 600 employees in 16 product teams, and over 30 percent patents filed (though the India operation was 22 percent of worldwide engineering).
In late 2003, I and two others came together at In-Reality Software and grew it rapidly, before another successful exit to Symphony Services Inc. We scaled the Symphony Pune business to US $25 million and 700+ employees by 2007.
After mentoring a few product start-ups between 2007 and 2009, we decided to try and build a successful product company from India. We are now focused exclusively on Sapience Analytics.
Time on Work matters not Time in Office
Sapience automatically determines on-PC and away-from-PC time, and differentiates between actual work and personal time.Your 9-6 pm staff (typically women) may be more efficient than those staying late
The 9-6 pm employees are most efficient at work – since they contribute high work hours in proportion to time in office. They often tend to be women employees who have commitments at home.
Programmers don’t spend even 50% of their work day in programming!
It is about whether you are focused on activities that matter and which result in most work being done, rather than less important but seemingly urgent tasks.
Sapience is discovering that a large amount of employee time is being spent on emails.
This is often a case of poor email habits: opening each email as it arrives, copying too many people, etc. Similarly managers spend a lot of time on planned and informal meetings. The two most important training programs required in companies are on email discipline and how to conduct meetings.
What are your future plans –in terms of this (work efficiency) product / and any other?
We have a multi-dimensional ‘expanding web’ growth strategy that covers product functionality, platforms, enterprise scale, and geography. The goal is to become the default standard for Automated Enterprise Effort Visibility and Gain.
For example, in the current year, we will cover all platforms including Linux, iOS, smartphones, calendaring tools and third-party presence servers. We have just released mSapience beta for Android smartphones, which help you track time spent on phone calls, travel and meetings away from office. You can distinguish between business and personal work.
What has it taken so long for Indian software market to focus on software product development? What changes have you see in people’s perception toward domestic software products?
India has dominated in the IT Services space for the past twenty years, which has benefited the country and generated self-confidence and reputation for India on the global stage. However, IT Services growth has slowed, and profitability is down. Cloud technologies and widespread adoption of mobiles and increasingly smartphones has caused a technology disruption that new companies can exploit. Indian market for IT products is reasonably large and growing. Moreover, the presence of MNC subsidiaries and large number of experienced software professionals returning back to India means that the right kind of product talent is available. Finally, some degree of angel and VC funding is now possible in this product ecosystem.
From being the protagonist of an Adoor Gopalakrishnan national award winning movie to a graphics trainer, from a book publisher to a printer, from services to products, our guest today has been there, done that. Meet Vish, the MD of Logical Steps.
ProductNation: Hi Vish. Welcome to Product Nation. Let us begin with your story.
Vish: I was born in an entrepreneurial family. My family ran a printing press in Kerala. So I grew up living entrepreneurship and also picking up skills to run a printing press. Childhood was exciting, as we were always creating something. As far as my education is concerned, I enrolled for an undergraduate Physics program at the Moscow State University. University had some of the finest minds in Physics teaching the subject. But, the 1991 coup cut short all this excitement. This brief stint while I was in Moscow, made me realize that college education does not prepare you for life. Though, I was not keen to go back to college, it was family pressure that saw me write three years physics papers in one shot. All this for a degree from the University of Kerala, Trivandrum. Isn’t degree everything?
It was around the same time that I got introduced to computers. My father had made investments into offset printing and desktop publishing. I soon found an entire computer science department to myself, right from laser printers to 486 machines. I learnt everything from scratch. It was time for my first fling with entrepreneurship. It was an MS-DOS pocket reference manual. Using a microsoft reference manual as the guide, I printed out some MS-DOS reference manual copies and handed it over to a local bookshop for sale. Surprisingly, the book shop came back for more. Simultaneously, I also ventured into Desktop publishing training, as the printing industry was moving in that direction. These experiments gave me the confidence that I could do something on my own
ProductNation: When did you get the time to do the Adoor Gopalakrishnan movie? And why do you consider it your first product experience?
Vish: Adoor Gopalakrishnan is a family friend and I had done a small role in one of his earlier films. He talked me into playing the lead role in a film called Kathapurushan. It went on to win the National Award in 1996. He knew about my background in printing. So, during the film, I got involved into many aspects of the movie production – recording audio, printing of collateral and special books. And working with Adoor Gopalakrishnan, who cared about every little detail and to experience his passion and leadership. I consider that experience extremely precious and a sort of first in making a product.
ProductNation: Which were the other movies you did?
Vish: No, I went back into computer training with a company called Tandem. Tandem, which was based in Trivandrum, sent me to CDAC Pune for a course called DACA – Diploma in Advanced Computer Arts. As a trainer, I was to learn this course and come back to Trivandrum to teach. At this course, I was the only one from a non-arts background, as the others were all from JJ and similar schools. But, I topped the class and got a break into advertising with a Kirloskar group company – Pratibha Advertising. One of the noteworthy projects that I did while at Pratibha was a digital kiosk that was showcased at the first Auto Expo in New Delhi. I quickly realised that digital advertising in India at that time was still very early. So I packed up my bags and went to Singapore for a teaching assignment with a University. But, I ended up joining a digital marketing company there. It was here that I spent close to five years till the dot com bust in 2000 consumed it. During my stint here, I got in depth experience into e-learning.
ProductNation: Is that when you started your current company, logical steps ?
Vish: Yes. I came back to India, after the dotcom bust. And that is when we started Logical Steps. We began by supplying learning content for television. We were paid 10% of the contracted amount. That is when I understood the trouble of doing business in India. So, I went back to Singapore to source business and keep the business running. It was challenging. I was using my salary to finance the business. I was not keen to close down and let go of my staff who had picked up extremely useful skills. So, we kept going. It was during this that we got a chance to service AIG for one of their projects. So that is how our services business started.
ProductNation: What happened to e-learning, then? And the platform? How did you start silver bullet?
Vish: An opportunity came up to create an e-learning engine for the US Market in the area of Medical Entrance exam called MCAT. A doctor who was considered the guru of MCAT had already created a large amount of content plus created analytics metrics to appraise students. We were given the project to create a platform that could provide all of this. This project gave us tremendous exposure to learning frameworks and gave us the idea to create a product on our own. That is how the idea of SilverBullet came up.By that time, I had also realised the limitations of a services business. So, we were all set for a product pitch in late 2010. While we built the platform quickly, content became a challenge. So we had to invest resources in training teachers to address this issue of content. This consumed our resources and it was our services business that was feeding silverbullet. It took us some time to adjust to this new reality, as we were dealing with an individual customer, unlike a corporate entity as in our services business.
ProductNation: Let us talk about silver bullet? Any learnings that you would like to share.
Vish: Silver Bullet is an online learning system for engineering and medical entrance examinations in India. There have been tremendous learnings. Unlike servicing a business, in this case, it was a B2C online product. It took us some time to figure out our Go-To-Market approach. We felt schools were the touch point, but it wasn’t so. Then we tried facebook, and it wasn’t the touch point. The most profound insight came from my 10 year old daughter, who frankly said that students are not interested in adding more studies to their daily work. She went ahead and said that no one would like to put themselves into trouble by opting for a Free Trial. How true? Students are already overworked. In all this, we figured out that it is the parent who is the touch point. And the parent was in a totally different world and a world that wasn’t online. The only way to reach them was through traditional media. It was then, that we checked out the media budgets of other online learning companies and found that they spend 19% to 20% of their revenue on ad budgets that run into crores, it is a totally different league. And that is how these companies are reaching out to parents. Parents are more than happy to add to the kid’s collection of material to consume.
ProductNation: Interesting, allow us to end this interview, with a difficult question. Looking back on your career, it is easy to see that you have been all over the place. How has it helped you in approaching your product business?
Vish: [Laughs] The product business is much like the movie business. If you see, my experience in diverse areas has given me ideas and the aptitude to create a wonderful product. Whether it is design or delivery, content or its packaging, all my earlier experience have served me well in developing Silver Bullet.
ProductNation:Wearing two hats at the same time i.e. services and products. What would you prefer? And what challenges do you face, while doing so?
Vish: Product without a doubt. It is something that you can own. But, when working on a product, especially when you are just starting off, managing the internal aspirations of the team becomes difficult.
ProductNation: Thank you, Vish for talking to ProductNation. We wish you all the very best in living up to these challenges.
Let me start with a simple question. What is common among these, as of 2006 (and, for that matter, even as of today)?
– Visa – Sony Playstation – Orbitz – NASDAQ – Microsoft Windows
All of these are known examples of facilitation based multi-sided business models. These are not just products or businesses; these are platforms, in the true sense of the word. These platforms have, some even in industrial and so called traditional businesses, created value by “facilitating interactions & transactions” among various groups involved. They depend on network effect to kick in, and then thrive big time.
The concept of the two-sided markets is not new. In fact, the newspapers might have been among the first to exploit it, through low-priced subscription subsidized by the sponsors paying for advertisements.
Networking Events and conferences have been a great example of a non-tech two-sided platform, and they are sold on the same direct benefit as well. The sponsors subsidize the participants’ fees, and hence get presumably higher visibility. Participants get to network; sometimes get direct information or sales leads; and pay for it unless in some cases, fully subsidized by the sponsors.
However, these business models, as represented by the examples above, were still very few & far in between until few years back.
The business world, since, has changed. And, drastically so!
Google and Apple have become the most valuable brands in the world. Amazon, that revolutionized the Books & Publishing market through the e-Commerce strategy, has since transformed itself into a Platform company. Facebook, Twitter, Instagram, and recently Pinterest have become the household names, beyond the tech world. Travel, Hospitality & Commute have become well-integrated platforms driven businesses – driven through online technologies and ground-level operational integration.
HOW SONY FALTERED, AND HOW APPLE & GOOGLE PROPELLED
Let’s take an example of two companies that seem to be very similar on products stack otherwise. Apple and Sony. Sony actually brought upon the concept of music that you could carry, with its revolutionary Walkman. Apple came in very late, with iPod. Sony has had a premium quality tag in computing machines (with Vaio) for a long time, while Apple’s Mac slugged it out in its own creative/designer/geek space. Sony even had the earliest starts with its Reader as long back as in 2006! They even had a great idea of Reader being the platform, and got the leading publications in Japan to take note that time. Sony, a very relevant company even today in tech world with the quality and huge brand image to boot, (interestingly, it has had at least one product in platforms category in Playstation) has fallen to 31-Year lows. They continued selling products in silos on their own standalone benefits. They are a product company, still a great one, but that doesn’t seem to be enough!
On the other hand, Apple had an iPod – as a standalone “take your music with you device”, around 2001-02. With iTunes, it took the first steps into a platform around 2003. However, it has since transformed into a true platform company, with its formidable all-integrated business strategy that brings together computing, entertainment, and business. iTunes is a comprehensive AppStore, and not just a music store. Apple is a multi-dimensional company at its best – it brings multiple beneficiaries together in this multi-facets products business. iOS developers and Applications users. Musicians, music companies and Music lovers. Local or global businesses and their customers and fans. We’ve even started seeing the serious Enterprises making Apple devices the central to their CoIT (Consumerization of IT) and collaboration strategy. iPod, iPhone, iPad, Mac, iCloud – they sell products but they’re a platform! And, in Feb 2012 Apple became the most valuable company in the world!
Google is an obvious name in the multi-sided platforms strategy. They took forward the newspaper ads model and applied it to search beautifully. And now, with the Enterprise businesses as well as their ever-growing list of vehicles – in GMail, Google Apps, Android, Chrome, Maps, Drive, and so on – have established themselves as an formidable Multi-sided platform. At this time, there doesn’t seem to be a limit on what vehicles Google can choose to drive their platform strategy. Microsoft is now fighting it out on its own turf while Google and Apple make inroads into its huge Enterprise foothold. (This also points to another trend that I’m planning to write about – the blurring of lines between Business & Personal Technologies).
SO WHAT?!
This era clearly belongs to the multi-sided Platforms based business. It’s important, however, to not confuse this with the traditional definition of platforms in technology space. The true business platform is the one that is driven by facilitation and network effect, and which actually has multi-sided business model in the sense of heterogeneous set of beneficiaries that are not directly connected to each other. It is also important to note that this disruption has been caused not only by technological evolution, but also the interlinked effect of the other disruptive patterns such as “Long Tail” and “Free”, both terms made popular by the very respectable Chris Anderson. I will touch upon these in the next couple of posts as noted in my cover post on Game-Changer trends.
If you’re in a business – whether technology or not, whether e-commerce or not, whether products or services – don’t ignore this trend. Think about how you can leverage on this model, or be part of this ever-growing multi-cog machine that benefits all its gears. But, if you really think details, it’s not just a marketing gimmick, and it’s not just a tweak in the product. It should become the foundation of how business of your product is conceived, strategized and operationalized.
PS: This post originally appeared on my blog, but I thought it’s worthwhile to post it here. Very relevant, hope you find it too!
The proverbial chicken and egg problem of building a new social product is well understood among tech startups, and it’s been commonplace to follow two contrasting mechanisms for getting traction.
Traditionally, startups have solved this problem by racing to connect users with each other, essentially providing them the pipes to interact with each other. Twitter, Facebook and LinkedIn have grown big with this connection-first model.
However, a new breed of networks is gaining ground with the content-first model. They provide users with tools to create a corpus of content, and then enable conversations around that content. Behance, Pinterest, Instagram, Dribble, Scoop.It have all gained traction by building a corpus of content before building a social network.
The two contrasting approaches are summarized below:
The rules of building a social product are changing. It’s important to understand this shift to build social products that can effectively gain traction on the internet today.The connection-first model is no longer as effective as it used to be. As the social web grows, and a larger number of social products compete for our attention, we are seeing a dramatic shift towards the content-first model. If you’re still getting users to send out Facebook invites, you’re adding to the noise, instead of standing out and getting noticed.
The Connections-first Social Product
Traditionally, the playbook for building network effects has been the following: Get users on board, connect them to each other and have them create content and conversations.
Social networks like Bebo, Facebook and Twitter used this playbook to create their respective networks leveraging address-book integrations and other hacks to rapidly build a large number of network connections.
Since a critical mass of connections is required before users experience value, the key to building a successful network is minimizing the friction in creating connections. Contact-list integration helped social networks like Facebook and LinkedIn gain initial traction through the removal of sign-up friction.
In spite of growth hacks like contact-list integration, there is always a lead time in getting users on board and reaching critical mass. This is the ‘gap’ where it becomes very difficult to demonstrate value in using the product.
Frictionless sign-up + Virality = Network Effects? Or not!
Startups often believe that removing friction in sign-up and creating some form of viral acquisition are the two key elements to reaching critical mass. In fact, with the rise of Facebook Connect and the social graph, a large number of social products have sprung up on the promise of frictionless sign-up and viral growth. However, users on the internet have limited time and attention. As more startups leverage the social graph and flood users with invitations to join their networks, users have started to develop invite fatigue.
Clearly, frictionless sign-up and virality are not the one-stop solutions we were hoping they would be.
The secret to network value
Startups often fail to appreciate the gap between technology and value proposition. For products like Evernote, technology serves the entire value proposition. However, for social products, the value proposition is a combination of technology and the content that users create on top of it. YouTube’s value lies in its hosting and streaming capability, but more importantly in its vast repository of videos.
The secret to creating a social product that demonstrates immediate value is to enable content before creating the network.
Content created on the network is the new source of competitive advantage. The videos on YouTube, the pictures on Instagram, the answers on Quora are the primary source of value for users and the key driver of competitive advantage for these platforms.
The Content-first Social Product
Today’s social startups don’t start off as networks. They start off as standalone apps. These products enable users to create a corpus of content first. They then connect the users with each other as a consequence of sharing that content.
Instagram started out as a photo-taking tool and built itself out into a social network subsequently. The initial focus was entirely on the creation of content and the connections were formed over time leveraging other social networks. It is unlikely that Facebook would have considered Instagram a direct competitor in its early days, largely owing to its model of deferring network creation.
How to create a network in stealth mode
Instagram started off as a standalone tool. In doing so, the product provides ‘single-user’ utilityto the user even when other users aren’t around on the network. There are two aspects to building single-user utility:
1. The single-user utility should allow creation of content that will ultimately form the core of the network. The core of Instagram is pictures. Discussions are centered around pictures. Hence, the single-user tool needs to allow creation of pictures. This is an extension of the OpenTable model, where a restaurant first manages its real-time seating inventory on a single-user tool, before that very inventory is exposed to consumers on a network, to allow them to reserve tables. Curation-as-creation products like ScoopIt and Storify also use this model to curate content which will serve as the core for network interactions.
2. The product should deliver greater value when users share their content with their friends. The product builds out the network at the backend as more content is shared. Hence, the social network gets created, effectively solving the chicken and egg problem. A new breed of curation-as-creation startups (Scoop.It, Paper.Li etc.) is gaining traction on a similar model.
The new playbook for creating social products is essentially the following:
Have a vision for creating the network but do not start executing on network creation
Enable a single-user tool that creates content that is core to social interactions
Share this content on external networks (social networks, email, blogosphere)
Capture interactions around the content to build network linkages at the backend
Open out the network once a critical mass of linkages have been built
The rise of the content portfolio
Instagram demonstrates how a network is created around a portfolio of user-generated content. Behance and Dribbble have followed similar strategies by providing a portfolio for hosting designs, before adding value through the creation of a peer-review community. Initially, Pinterest appealed to the designer community as a tool to ‘bookmark’ their favorite designs, before it built out the network. Early adopters found enough value in the ability to store designs and pictures, to use the product before the network became active.
The new success factors Frictionless sign-up and virality are important but they are no longer the key to building social products. The following are key to building content-first social products:
Removal of barriers to the creation of content: Startups like Instagram, which succeeded in simplifying the creation process and in enabling users to spread the word, succeeded in eventually building the connections between users.
Growing the creator base, not just the user base: Since value for the overall networks is scaled by scaling content creation, the platform needs to focus on incentivizing and increasing the percentage of users who create content.
Strong curation models: Content-first social products scale well only when there is a strong curation model in place to separate the signal from the noise. Without strong curation, greater content can actually lead to a poorer user experience leading to reverse network effects.
Incentives: The platform needs to encourage users to build out the connections. This works best when the platform encourages an innate motivation (self-expression or self-promotion) in the user to spread the word about her content. In doing so, the users build the necessary connections that set up the network.
The new growth hacks In the connections-first model, the one hack that minimized friction in building connections was the contact list integration. In the content-first model, the hack that minimizes friction in creating content is the creation widget. Creation widgets have grown in popularity in recent times, spreading across the internet in the form of browser add-ons and one-click buttons. Several curation-as-creation startups like Pinterest and Scoop.it have used widgets to enable users to create content easily.
The future
This new model of building networks allows a social product to gain traction while value is being created by users. Once enough content is created, the users are connected and the network builds out. Social products that win will focus on enabling users to create content first and generate conversations around it. The creation of the actual social network will be a final step, as a consequence.
Note: This article was first featured on Sangeet’s blog, Platform Thinking (http://platformed.info). Platform Thinking has been ranked among the top blogs for startups, globally, by the Harvard Business School Centre for Entrepreneurship.
Update: Some readers have asked for information about MOOCs. A (MOOC) massive open online course is an online educational resource that is available for open access via the web. MOOCs originated around 2008 within the open educational resources (or OER) movement. For more, refer to the Wikipedia link.
Online learning is undergoing a paradigm shift and this Forbes article is a pointer of the shape of things to come. Coursera, Khan Academy, Udacity, Udemy etc are growing into large public platforms and likely to give competition to universities and colleges in the years to come.
LurnQ is an Indian startup that is building a personalised learning management solution which can aggregate and curate content from the web. The key part of LurnQ replicates an experience that everyone is familiar with – using a user’s preferences to aggregate content from the web and display it like a Facebook newsfeed (see screenshot). This is a smart strategy and takes advantage of the the benefits of recognition (rather than recall).
The LurnQ platform consists of different applications that are bundled together into a SaaS platform. The core of the platform is a repository of web content from established MOOC sources like Coursera, Udacity, Khan Academy etc. There is a learning app that displays content in multiple formats – video, slides, multimedia. And a teaching app that gives teacher the capability to put together a course.
The site has over 5000 registered users and is growing socially over 100% every month via Facebook (without ads). They also run a student ambassador program. And here’s a list of LurnQ lessons if you want to check them out.
For monetization, LurnQ is aiming Freemium. The core consumer product will remain free at all times for learners and teachers. A premium version will be available for private or closed community deployment by individuals and organizations. Pricing details are still in the works.
For targeting growth, LurnQ plans to extend the Student Ambassador Program and drive teacher side adoption through special initiatives aimed at teachers. On the application front, they want to focus on viral features (follow lessons, users, Invite friends etc). Also possible is the route of content partnership with conferences. Mobile apps are planned at a later stage to drive on the go consumption across devices.
LurnQ looks like a refreshing idea and a spin on what others are doing in the MOOC space. The first challenge they face is getting to a threshold for their user base. The adoption of the newsfeed as a core experience is likely to help in viral growth. Though the homepage is a logged in experience and departs from the design pattern that characterises Web 2.0 user generated content platforms… this might prove an impediment to quick user acquisition.
I believe one of the best ways to learn marketing and business in general is to learn from other people’s successes. And in a bid to do that, I am going to bring to you interviews of Indian startups that have taken their products to the world. We will talk about how they got the initial buzz going, where they got their first set of customers from, how did they scale that up, what marketing metrics they measured, the mediums they used, the stories they went to press with, the biggest mistakes they made, how they handled criticism and more.
Here I am in conversation with Avlesh Singh, co-founder and CEO of Webklipper, the company behind WebEngage. WebEngage is a powerful customer engagement suite for your website that lets you collect feedback, gather customer insights and ultimately drive sales and conversions. They have gone from nothing to 7,000 customers (both free and paid) in less than 15 months and have done it all with a very lean team. Let’s get started.
What does WebEngage do? How does it help websites engage their visitors better?
Avlesh: WebEngage is an in-site marketing toolkit for online businesses. We help companies improves sales/conversions and help them collect awesome insights from their customers. All in real-time.
Using our Notifications, companies run targeted promotions by offering discounts and value adds to people “most likely” to purchase. Surveys on the other hand help customers collect insights to measure customer satisfaction and do lead generation on their site. And our Feedback product is the world’s simplest customer support tool that gets you up and running with a no-frills support channel on your website in less than a minute.
So who do you pitch your products to in a company? Marketing?
Our primary audience is Marketing and Product Management. They see the most value in this tool.
What’s your pitch to them?
Simple. In this order:
Ever walked into an offline store? How often did the salesmen try to educate you or nudge you into buying something? We let you do something similar; ah, for your online store!
Not sold yet? Okay, your marketers can run in-site campaigns without changing any code on the site; without seeking any developer or IT help. Oh yes. This is true. And these are truly rich messages with dynamic targeting capabilities. Care about user insights on your product or catalog? Care about user feedback?
Not sold yet? Okay, see who uses our products. Also see some live demos on these sites.
Not sold yet? Here’s the website and our blog. Look forward to work with you. Bye.
Let’s back up a bit here. Tell me how you got the initial buzz going for your product? What part of it were you able to convert to real paying customers? Where did you get your first customer (or first set of customers) from?
We were in private beta for 5 months. Forget paying customers, we had a tough time finding the bigger guys to use our product. We focused a lot on education through content on our website and blog, answered direct question on Quora etc. Our live demo feature went viral and a lot of developers came out of curiosity to the site to find out how that thing worked. Here’s a sample of how curious developers got
From free to paid, it was a three month journey. We went live in Oct 2011 and it took as good 2 months to get our first set of paying customers. We reached out to our beta users announcing the paid plans and features that would come along with it. Some tried out but never paid; a few took the big leap of faith and became our first set of paid customers – Art.com, Park-n-Fly, MobileDevelopmentIntelligence, Cleartrip, Justeat, Makemytrip etc to name a few.
75% of our customer base (free and paid) is outside India. That is how it was to begin with, too. With most Indian customers, early on, we had to go for F2F demos and explain the product in-depth for them to take the plunge.
Did the marketing start as you were developing the product or only after it?
It almost went hand-in-hand. So far, we have only done content marketing. And we have been done a fair job. Our plan is to do 100x better with content.
Did you have a marketing plan in place? Did you have numbers, like say, I would be able to get 100 signups if I do this and this and this? How much of that worked out?
No, we never had that. And it’s difficult for our category because customers are not “looking” for a push messaging tool on Google. We are trying to “create” a market and content is the only predictable way to go about it. This is definitely not true for customer support tools as they can direct their marketing spends on Google because too many people look for such tools everyday.
Also I see you have a Powered by WebEngage link in your surveys and feedback? Is that like a major marketing channel for you? What kind of traffic and conversions does it bring in?
It is the biggest source of inbound leads for us. Over 40% of our sign-ups happen from those logos in the three products. It is also a blessing in disguise because over a period of time we have started commanding huge premium from our enterprise customers who would otherwise want to get rid of those logos on their sites. We end up losing a lot of visibility but then get paid well for it too.
What other marketing channels have you used? What has been the most effective for you? How do you go about figuring which marketing channel will work for you?
We tried display ads. We tried paid app directory listings. We tried outsourced sales and marketing arms in the US. None of these worked very well from customer acquisition viewpoint. Content continues to rule our marketing plans. We are spending a lot of time and money now on building great quality content – videos, how-tos, galleries, use-cases etc. In the next month or two, you’ll see a lot of stuff on this front. We plan to do display advertising too, but with some corrections by incorporating learnings from our previous experiences.
As WebEngage grew, how have you scaled up your marketing?
In our case, we focused a lot on support. We used to (and still do) take calls at 2 in the night, pretty much everyday. We have managed to do this with great success. Happy customers are the best marketers. We got a lot of referrals from them. Most of our marketing efforts are around content creation. And so far, we have managed to do it in-house. We haven’t spent too many ad dollars.
How do you measure the success of your marketing? Compare them to historical data, industry benchmarks or…? And by marketing I don’t just mean paid campaigns, even a new website, new onboarding emails or anything on those lines.
We measure it based on conversions. Be it paid marketing or content, we have always believed in creating a workflow to measure and track conversions. Free tier sign-ups through paid marketing don’t work for us. That’s the reason we don’t spend ad-dollars. Content gives us a low cost channel of customer acquisition which we can further up-sell/cross-sell to. That’s one area we are trying to improve upon.
For our website, blog, video etc, we measure the success by amount of time spent on each of these. Customers on an average spend over 7 minutes on the site. It used to be less than a minute 6 months ago. In any SaaS business, customers want to read a lot and be sure that they want to pay before choosing to do so. Content helps in decision-making.
How do you keep a visitor engaged right from the first time he hits your website to him becoming a customer? How does your tool itself help with this?
We eat our own dog food. Spend a minute on our pricing page and you’ll come to know . Take a look here – http://blog.webengage.com/2012/11/24/how-we-eat-our-own-dog-food-at-webengage/
Plus our live demo feature keeps users busy and educates them very well on what we do; it generates a lot of leads for us too.
What are the top 2-3 insights you got using WebEngage that you wouldn’t have got otherwise?
Here, in this order:
The amount of time and effort needed to sell a $100/month product is the same as $1000/month product. I’d rather channelize my efforts into finding high ticket size deals than smaller ones; I used to think otherwise until an year ago.
There is no better marketing tool than a bunch of happy customers. Some of our biggest enterprise deals have been through warm intros by such customers. How did we keep them happy? Beautiful product and proactive support; I undervalued the importance of latter until an year ago.
What are some of the biggest mistakes you have made on the marketing side of things?
We “outsourced” our sales/marketing to a sales-on-demand team in the US. I won’t name them. We spent crazy money in “retainer” fees and had 0 conversions by the end of pilot. Their so called “smart team” had no clue of what we were building, even towards the end of the pilot.
What marketing numbers do you measure? How often?
Money spent. Number of conversions – free and paid. Every month.
Let’s talk pricing. How did you get to the $15-$99/month model you have? Is that the price you started off with as well?
Mostly by talking to customers on how much are they willing to pay. Yes, this is our original pricing. But, we have made a lot of tweaks to the features being offered in each of these plans.
What tools and systems do you use?
Our own for tool for in-site marketing. And Adwords. Nothing major apart from that.
Your new website is a massive improvement over the old one. How has it increased your conversions? What objectives did you have in mind going into the new website?
Oh yes. We had only one objective, have people spend more time on the site and “see” what we do. Everywhere you go to, there are links to see our products in action. That was the only way to educate people on what we do. Take a look at this page – webengage.com/how-it-works
What advice do you have for startups planning to do an overhaul of their website?
Only one – decide what you want from it. Sign-ups, Conversions, Branding, Education … You can’t design a site to do all of the above. That’s the area we generally go wrong. Designing it with one objective always helps.
What kind of community do you have around your products?
None, yet. We want to build one.
What about partnerships and integrations?
We have focused a lot on integrations. Take a look here – webengage.com/integrate-with/your-website. This has worked out very well, because all of a sudden, customers start discovering you on new platforms. They would have otherwise not even known about us. We continue to focus on this. Second, we are building robust API’s with a larger goal of involving developers in building some intriguing applications on top of WebEngage. First cut here – docs.webengage.com
We have just started exploring partnership opportunities. Too early to comment.
What about your personal brand? How have you used that to increase the visibility of your products?
Yes, I am a classified spammer in the virtual and real world who leaves no stone unturned when it comes to promoting my product. Too bad, I know.
What do you think is an ideal marketing team for a tech startup?
I keep saying this – initial selling and marketing has to be done in-house and preferably by the founders themselves. If you, as a founder, cannot sell your product, no sales guy can. It is that simple. But its tough to understand as well, because I see most founders in tech companies get uncomfortable upon hearing this.
With 6700+ customers, you have been very successful in taking your products to the world. What advice do you have for other Indian startups who are looking to take their products to the world at large?
See, how fast things are changing. That number is now 7100+, both free and paid
Here, in this order:
Build a good product. Great brands were not built by advertising or marketing.
Make sure there’s zero human touch in the product. Customers outside India don’t like getting stuck in a workflow that needs human intervention.
Selling and marketing is a D-I-Y job until you reach significant scale.
Network with right people. Don’t shy away from seeking help or intros.
Have a good website. There’s no alternative.
Educational content and live demos definitely go a long way with marketing a product that customers are not looking for. Thanks Avlesh for the great insights.
Dear readers, if you have any follow up questions for Avlesh, please leave them in the comments below. He’s a busy man but I will get him to answer them
This article was originally published on Sanket Nadhani’s blog Poke and Bite
NowFloats – Getting small businesses online in 4 SMSes and 13 minutes!
I love clear mission statements, and NowFloats couldn’t be clearer:
9.6 million small and medium businesses need a website. Only 0.6 million have one. That’s 9 million tasks on our desk (and that’s just in India!)
I recently got a chance to catch up with Ronak and Jasminder (Jas), 2 of the cofounders of this exciting company called NowFloats that aims to bring SMBs online, without making them sweat over it (other 2 co-founders are Nitin Jain and Neeraj Sabharwal) . NowFloats is a team of 20 (4 founders, 4 tech, others in sales and support), based out of Hyderabad, though their customers are spread all over India. Overall, I was very excited by what I listened and saw, I sense that NowFloat holds immense possibilities for small businesses and has all the right ingredients to be successful in its mission.
The problem for small businesses
Given increasing reliance of users on search, it is becoming important for offline small businesses to have an online presence. An online presence needs to have discoverability (users know that you exist), engagement (users interact with you and like you), and conversion (users visit your offline business). However, when creating such an online presence, a small business has to grapple with 3 problems:
Creating a website takes too much time and effort – even for tech-savvy type, which a small business owner is not.
Updates require engaging website developer again – too much effort and dependency
Online marketing is hard and expensive, and requires digital marketing expertise, not something a small business owner has
Standard option currently for a small business is to do nothing about online presence; very few businesses hire someone to create, maintain and market their site which is very expensive option without clear ROI.
NowFloats solves this problem for small business in an easy-to-use manner at an extremely affordable pricing.
NowFloats Promise
NowFloats promises to allow a business owner to create a website in 4 messages and in less than 13 minutes – send the name and address of your business, website name you desire, and your website is ready to use!If you wish to update the site (messages on message board or updating any of the original details you provided while creating the site), it is as simple as sending another message.
It may look like a simple and easy website to create, but it packs a lot of punch:
Site and every message are geo-tagged, which means local searches will show up your website and deep-link to your message.
Your website and each message is search engine optimized
Each update is a page so it can be shared by your customers on social networks, which again has endless social, search and business possibilities.
Visitors can subscribe to get all subsequent updates, or leave message for you to follow up with them
NowFloats – The Product
Design: NowFloats is a very well-designed product. Their company website as well as the customer sites are beautiful in their minimalist and pleasing design.
Technology: They have a scalable architecture, built using Microsoft technologies. They have 4 patents filed and 2-3 are on the way. They offer subdomains under nowfloats.com in addition to allowing customers to use their own domain names if they wish – like Body Granite Gym and The Courtyard & Cafe Courtyard do.
Analytics: They care deeply about analytics that customers get about their online visitors. Businesses get weekly information about how their site is doing (# of page views in a week). On their product roadmap, they have features to provide details like which messages got max view, keywords which generated maximum views, etc., goal being to show what type of content is attracting maximum traffic.
Pricing: Pricing Plans (5K to 12.5K a year) are very competitive, given that even hosting a site costs 3-5K a year. NowFloats is still reviewing pricing strategies based on market feedback so expect this to change soon.
Test-driving NowFloats
As I took the service for test-drive, here are my impressions:
As soon as the site was created, I got a call from their customer service. They wanted to confirm my identity and walk me through the next steps, including collecting payments.
I realized I picked a wrong name for my business, so I wanted to change. A call to customer support informed me that they will have to do the change for me, though an app is coming which will allow self-service. Later I found it was only partially true, the name (and many other details of the business) can be updated through SMS messages even now. I promptly used the service.
I wanted to update the site using my laptop, but changes can only be done using SMS, upcoming app, or customer support. I find this a little annoying.
I tried to get creative and sent an html fragment as an SMS message, which created a broken message on the site. Given that I can’t update it online; this requires me to call customer support. Later I was told how to do this, and also given the current target audience, this is not an often used feature.
Customer Acquisition
Clearly small businesses see value in NowFloats offering. In a short span, they have 1600+ customers live, including customers like Hazzel Ice Cream Cafe and Dr. Chandrika’s Kerala Ayurveda . I was fascinated by the variety of customers they have attracted, including my favorite restaurant in Hyderabad, a Nokia Priority franchisee, and even a personal branding site. These sites are discoverable (through geo-tagging, auto-generated tags and other SEO techniques, sites and messages come up in ahead in all search results) and drive engagement (users subscribe to the messages, businesses get notified when someone subscribes or shows an interest). Conversion (people visiting the business) is hard to track and NowFloats team is working on some solutions that will allow such tracking.
NowFloats has multiple approaches and channels to acquire customers:
Geography: Started out with targeting Hyderabad businesses. Currently they are focused on Bangalore businesses. The goal is to have pan-India sales presence soon through partnerships and other means and continue to expand city by city.
Catagory: One of the innovative ways they target a particular category is to target the franchise business owners of a particular brand. For example, they have brought many Nokia Priority franchisee owners online, same with Printo. Given the huge number of franchisees in India, this seems to be a winning sales strategy.
Partnerships: They have a shop-in-a-shop model with Printo. Since Printo serves much of the same customer segment as NowFloats but with a complimentary service, this is a great move to gain customers. They are exploring similar partnerships with complimentary service providers.
Couple of other things I would like them to focus on:
Online Presence: I can’t discover NowFloats online. Google search for getting my business online didn’t say anything about them in first 3-4 pages. I think they need to make their discoverability better as they go forward.
Social: Small businesses thrive on communities and loyal customers who like the service they get. One of the best ways to reach small businesses is to tap into this community and loyal customer base, through social or other platforms. I would love to introduce NowFloats to the small shops I visit near me, but there is no good way for me to do so.
Competition and Differentiation
When I researched around, surprisingly, there aren’t many cost effective ways for small businesses to create online presence. India Get Online program from Google aims to get Indian businesses online and are a viable option for a small business. However, I think NowFloats offers a more targeted and sustainable product, that can potentially complement the Google offering.
Google’s strategy is to get a basic site up for you so that you are visible in local searches, to stay visible. NowFloats focuses on getting a site for you and market it online for you, thus helping you stay focused on what you do best – run your business.
What Future holds for NowFloats
I see NowFloats extending itself in 3 areas:
Richer Eco-system: NowFloats plays in the local search space through their mobile app. A successful ‘NowFloats for business’ means rich data about local businesses available for their app to make use of. Controlling the supply of rich data from small, local businesses has lots of grand possibilities.
Richer Revenue Models: Currently, there revenue is subscription-based, and it may be hard to show how an investment of 12500/- per year translates into increased traffic (and revenue) in their offline business. Their goal is to evolve newer revenue models that can directly tie NowFloats revenue with SMBs revenue, thereby creating a symbiotic and sticky relationships.
Richer engagement with businesses – Businesses need many services as soon as they realize the potential of an online presence. Selling online, driving deals, building software solutions for their businesses, etc. all can be offered once the business is on-boarded.
Power of an idea lies in simplicity and pervasiveness. After I talked to NowFloats team, I have been observing small shops around me in a new light. If the great little corner shop selling briefs could be easily discoverable, If my favorite restaurant in Greater Noida could be more engaging, if the grocery shop in my apartment complex had an easier way to let me know of his deals, I am sure these businesses would benefit immensely. And it is so simple for them to do so now – by using NowFloats. Nowfloats is a very powerful idea whose time has come – may all the power be with small businesses and NowFloats!
