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Piggybacking Mechanics: Whatsapp, Instagram And Network Effect Marketing

Welcome to the age of the zero-dollar marketing startup. WhatsApp, and earlier Instagram, have officially become a permanent part of startup lore for having built multi-billion dollar businesses without (reportedly) spending a dime on marketing.

Meanwhile, Airbnb has grown from a hipster community of mattress-renters to the world’s largest provider of accommodations without spending even a fraction of what traditional hotel chains spend in marketing.

Marketing is dead! Or that’s what many would have you believe. A great product sells itself, of course! Fire the marketing team!

Well… not quite!

The fastest growing networks on the internet – Airbnb, Instagram, Facebook, YouTube, Snapchat – may not have spent much on marketing, but they all have one thing in common: Each of these networks piggybacked on top of another pre-existing network.

Facebook and Bebo grew on top of the network embedded in our email. Many networks, including Instagram, grew on top of Facebook itself. For a while, Airbnb grew on top of Craigslist, while Snapchat and WhatsApp have leveraged the mobile phone’s organic network, the phone book, to create networks native to mobile,

If you’re building a social network, marketplace or platform and you haven’t considered piggybacking on a network, you need to think again.

Much so-called ‘growth hacking’ relies on testing of cause-and-effect and optimization of funnel conversions. But in the early days of a network or a marketplace, startups are faced with a radically different problem. Why will users come on board when there’s no one else there? Why will producers set up shop in a marketplace that is not yet frequented by consumers and vice versa?

The classic chicken and egg problem cannot be solved by pulling in users and optimizing conversions. Before network effects set in, users will neither get activated nor will they get engaged.

Set a network to catch a network

To grow a network, you need to think like a network. To get enough users on board to create network effects, you need to piggyback upon another network. Piggybacking on a thriving network works wonderfully as long as your platform is complementary to that network and delivers additional value to the users there.

As far as growth strategies go, there are few strategies that are more scalable and sustainable as engines of growth.

Paypal got almost all its traction by piggybacking on eBay and offering a much superior payment method than the painful check-over-mail. It solved the pain points around payment on eBay providing instant payments without the hassle of credit cards and assuming much of the risk of online fraud.

Soon enough, Paypal was the predominant mode of payments on eBay and rode its growth to become synonymous with online payments.

But not all piggybacking stories end happily ever after. Apps that have leveraged Facebook to grow aggressively, have found their business jeopardized with a change in Facebook’s news feed algorithm. Startups that tried to emulate Airbnb and siphon users away from Craigslist were sent cease and desist letters. Even Paypal was banned on eBay for a while before the marketplace had to accede to the wishes of the users.

So what does it take to successfully piggyback a network?

The Biology of Piggybacking

Successfully piggybacking a network is more complex than simply choosing a network and executing an API integration. A startup looking to piggyback on an underlying network needs to understand the nature of its relationship with that network.

Borrowing analogies from biological systems, there are three types of relationships between your startup (the Guest) and the underlying network (the Host).

The Happy Clownfish

In certain cases, a partnership model may be initiated by the Host i.e. the underlying network.

Much like how colorful clownfish (Guest) inhabit sea anemones (Hosts) whereby each party gains protection from their respective predators, both networks benefit from each other.

For example, Facebook’s partnership with Spotify, following its launch of frictionless sharing, is designed in a way that both Facebook and Spotify benefit.

Facebook needed greater engagement among users and Spotify needed listeners, even though the implementation of frictionless sharing has much that can be improved. Earlier, Zynga, Slide and RockYou benefited from a similar relationship with Facebook, piggybacking on Facebook for growth by providing value to Facebook users, while improving user engagement and retention on Facebook.

The Hitchhiking Remora

Not all networks may initiate partnerships the way Facebook did. In fact, most don’t.

In such cases, it is the prerogative of the guest (your startup) to be backward compatible with the host, much like a remora attaching itself onto a shark and feeding off it, you need to figure out a way to embed your functionality in the host network.

YouTube gained early traction by piggybacking on MySpace. Engagement on MySpace was built around musicians who needed a way to showcase their talent. At the time, online video was broken. YouTube fixed that with its flash-based one-click video experience and MySpace users finally had an answer to their problems.

Flickr solved the pain of sharing pictures in the blogosphere. Every blogger putting up a picture on his blog helped showcase the service to others. Flickr rapidly grew to become the fifth most visited website on the internet by the time Yahoo lapped it up.

As these examples demonstrate, these relationships start without an explicit partnership. The Guest makes a conscious decision to make its functionality and content embeddable in the Host network. If such embedding solves a key user pain point, the users start embedding Guest functionality into the Host network, driving adoption. The chicken and egg problem is solved as more users on the Host get exposed to this functionality and migrate to start using the Guest’s functionality.

The Bloodsucking Parasite

Finally, some networks may actively discourage any form of guest-host relationship. In these cases, the startup needs to reverse-engineer an integration with the host. Such piggybacking is generally non-consensual.

Airbnb reverse-engineered a de facto ‘integration’ with Craigslist and offered users on Craigslist, an alternate, more convenient and safer destination for their interactions. Airbnb stole the network interactions away from Craigslist and was promptly blocked by the Host as soon as it realized what was afoot.

Skype, Viber and WhatsApp have similar relationships with carriers where they piggyback the connections created by the carriers (via the user’s phone book) to provide an alternate communication channel.

Viber rode this success to a $900M acquisition recently,and WhatsApp was acquired by Facebook for $19 billion in cash and stock.

Sidenote: It is interesting to note Skype, Viber, and WhatsApp are able to arbitrage users because of a lack of effective carrier data discrimination. That is to say, carriers are well aware of WhatsApp allowing users an end-around onerous SMS fees, but feel powerless – at this point in time – to raise network data rates to make it unprofitable for WhatsApp, forcing users back to SMS.

How To Succeed With Piggybacking

While piggybacking may seem attractive, startups need to be aware of the relationship they have with the host network and pursue strategies accordingly.

More importantly, not all piggybacking is successful. The stories above suffer from survivorship bias and are useful only when understood in the context of the factors that dictated their success and spelt failure for other startups that tried similar strategies.

In general, everyone wins in The Happy Clownfish scenario.

But in most Hitchhiking Remora relationships, the Host controls the relationship with the piggybacking Guest. This is specifically the case whenever the Host launches an open-access API upon which startups build off that to access the Host’s network. While remora may add value by plucking parasites, fickle sharks have been known to bait-and-switch and devour orbiting remoras.

The Bloodsucking Parasite relationship is a lot easier to anticipate and is always antagonistic. In most cases, it triggers an instant immune system response, which, translating to business, amounts to legal action.

The only long-term sustainable network-piggybacking, then, is the Happy Clownfish. Both the clownfish and the sea anemone need each other. Their respective physiologies are a clue. A clownfish will never grow poisonous tentacles to sting potential predators and a sea anemone will never grow fins to swim.

To be a clownfish in a sea anemone, your network needs to provide high-contrast, high-value-add differentiation with significant barriers to entry, otherwise you risk coming across like one of thousands of commoditized remoras. Facebook doesn’t want to build its own music library and Spotify isn’t interested in connecting the world outside of music.

There are three factors that determine success with piggybacking:

1. If the host explicitly calls for piggybackers, be the first to the party

When Facebook opened its platform to external developers, Zynga jumped on board and gained rapid adoption. Many startups that followed failed to get such adoption because users had become more sophisticated to the viral invites by that time and Facebook, as well, started dampening the spread of these invites subsequently.

Being the first to the party helps to get users deeply engaged before they get sophisticated and start ignoring messages from other services that follow.

Be the first clownfish to get to your sea anemone.

2. If you can build for backward compatibility, ensure you add value to the underlying platform

YouTube solved a problem for MySpace bands. Flickr solved a problem for bloggers. Paypal solved multiple pain points for buyers and sellers on eBay. Be the useful remora that eats the little parasites on the shark.

3. Be the first to reverse-engineer before the host wises up

When stealing traction parasitically, it pays to be the first to discover the chink in the armor of host network. Airbnb gained traction before Craigslist wisened up. But every startup that has tried that strategy subsequently has failed to replicate the same success and has instead been caught in a legal quagmire.

Being first to piggyback a host network is the most important determiner of success. There is typically a time window while these strategies work. And almost always, first-to-the-party wins. When the host wants you to piggyback, there’s a window while it will be effective. When the host doesn’t want it, there’s a window before which the host wises up. In either case, being first helps.

The story of many of today’s large social networks and marketplaces follows similar trajectories. Bringing in users through linear funnel hacking tactics often prove counter-productive. Finding a new network and piggybacking it helps gain traction among enough users simultaneously and build network effects.

So the next time you hear about a startup boasting a zero dollar marketing budget and putting it all on building a great product, think again! Piggybacking is the new marketing for the age of the network effect.

Note: This article  first appeared on TheNextWeb. This article was co-authored with Patrick Vlaskovits, the NY Times BestSelling Author of The Lean Entrepreneur.

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Is on boarding a game changer for customer centric businesses???

To stand out in today’s increasingly digital world, enterprises need to adapt to change by tapping into market, understanding the trends and anticipating what’s next. This digital world is not just technology, strategy and business, but cultures that are changing rapidly.

This is the age of the customer and onboarding is the first impression of your service. Make your first impression the best one since you do not get a second chance at it. Enterprises are transforming their processes to match customer requirements; customer is the king as your competitors are just a click away. Give your customers a convenient automated method to onboard faster thereby improving your customer experience and loyalty.

According to a recent survey published in The Wall Street Transcript, 98% of global banks have lost deals and revenue due to poor onboarding process. Around 20% of respondents indicated a loss of 25 – 50% loss of new business opportunity. This devastating lifetime customer value impact is due to long and non comprehensive view of the client onboarding process. The onboarding process has manual workarounds and lacked basic workflow automation. Primary reason for slow onboarding is snail background checks that lead to impatient customers dropping out in the middle of the process.

Before Digitalization

Onboarding was a background process where marketing executives would sell products and onboarding team would come into picture when the customer is ready to come aboard. Therefore 80% of client acquiring activity was done by marketing and 20% was done by onboarding team. Onboarding was never developed and enterprises did not see onboarding as part of customer experience.

Demand for Digitalization

Customers want to spend less time in onboarding and more time using your service. Wants to be treated like a king and have your services at the tip for instant satisfaction and interaction. Various channels of communication with transparent transactions and unified silioed approach.  At the end customer centric onboarding is what is expected by every customer. 

Advantage of Digitalization

Effective onboarding will mainly automate data entry to reduce operational costs, faster turnaround time, promote go green initiative and100% compliance. Other benefits are reduction of client attrition, improves cross-sell up-sell and increase brand loyalty. A happy onboarded customer would share the experience that is nothing but an indirect marketing of your brand.

Digital onboarding

With the increase in client onboarding processes, digitalization is part of transforming an enterprise into customer centric business to catch up with your customers. This world of diminishing margins, increasing regulatory pressure, increased capital requirements and stress on speeding time to revenue can get a digitally transformed high quality first impression.

 

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Reach, Revenue, Retention – Sampad Swain, Co-Founder and CEO at Instamojo. #PNHangout

Logo-FullSampad Swain is co-founder and CEO at Instamojo – a platform that lets you sell & collect payments instantly by just sharing a link. Today, individuals & businesses are using Instamojo to sell & collect payments for digital downloads, physical goods, event tickets, services, subscriptions & much more. He was also the co-founder of WanaMo.com and DealsAndYou. In this #PNHangout he spoke to us about his journey at Instamojo and the Instamojo Mantra.

The marriage of commerce with payments

The basic premise around which we started Instamojo was – how can we help the common man accept online payments from his customers. Payments typically have always catered to people who understood technology or who could afford to have a team who understands technology.  So our aim was to cater to the rest of the world who are not tech savvy.  He or she wouldn’t necessarily use technology but he or she would accept payments from her customer and it is around this hypothesis that we have been building our product ever since.

Now what we were doing at Instamojo is bring the convenience of online payments to the common man which essentially meant marrying commerce with payments. Moreover, as we had started the company in the US and not in India, we realised that we had to funnel our core hypothesis to one of bringing payments to a non-tech savvy person.  So we knew we had to build a structure around this.  India is the first market we are trying to get a strong foot hold in and we are working on expanding to other geographies using the same model where you can share a link and you can collect payments with it. We are skimming the surface of what we are trying to achieve at Instamojo but the last two years have been a brilliant journey of us not only building the product but also learning how the payment system works as there are a lot of stakeholders (such as the banks, regulators like the RBI, etc.) involved and more importantly, our customer base has expanded to over 10,000 customers worldwide and it continues to grow.

The evolution of Instamojo

Our journey from when we began to where we are now has had three distinct phases:

The idea phase:

When we started, we wanted to release a product to the market which caters to non-tech audiences collecting payments and we realised that the easiest way to do this was to give the Instamojo user a unique URL (a.k.a. imojo.in payment link) which he can share with his customers over sms, email, social media, etc. which they can click on to pay for his product.  This was the core product that we started building.

Sampad Swain BWWe were not concerned with releasing a perfect product when we began as our main focus was to test if our hypothesis was correct. So we knew that we had to release the product as soon as possible and then iterate rapidly based on the feedback we received from our customers. In fact from the idea to the release it took about 3 weeks to roll-out the product to the market. We would talk to our customers’ everyday through social media channels like twitter and blog posts where they would give us their feedback which we would then allocate to one of three different buckets – reach, revenue and retention. Reach was our primary focus early on, so we built features at Instamojo which accentuated that portion of the business model. We had to ship products which catered to the statement of reaching more people as early as possible. Take feedback, iterate and make it better every day, so that when somebody comes back to use the product again they would see that it is a better product compared to what they had used previously.

The product building phase:

The product building phase started when I went to Silicon Valley for six months where we were part of the 500 start-ups accelerator program in Mountain View – California. At this point we had crossed the reach phase of our three buckets and we were looking at enhancing our revenue channels. So we focussed on features that helped us increase our revenue month over month and we released around 24+ features which aimed at increasing our revenue base. After Silicon Valley, we went onto to raise almost $500K from our investors and now with some money in the bank, we decided to focus on retaining our customers.

The business building phase:

We now had gained traction in reach and revenue. So we began building features to retain our customers. For example if a user had previously faced issues while using Instamojo, he would consider using a different product. So the idea was to keep the platform as simple as possible without demotivating the user. The user would share a link and collect payments; nothing else thereby providing a simplified user experience. This is how the product has evolved from idea to conception in the last 18-20 months.

The Instamojo Mantra:

At Instamojo, our philosophy is very practical i.e. release those products which are more data driven to the market because the chances of getting a product right in the market increase significantly as data never lies. Consequently, we do everything based on the three buckets i.e. revenue, reach and retention. It is critical to understand what matters to the business because when you are a small company, your resources are limited and your bandwidth is limited. Since you have to do more with less, it is very critical that you are aware of what the business needs right now. Also, I have seen very few companies who have succeeded at focusing on these three aspects together early on.

So when implementing features, we keep a tab on the customer feedback that we receive as we already have thousands of feedback requests from our current customers. We then try to tag the feature request to the three buckets and we analyse which bucket’s problem this feature will help us solve. If our focus is revenue and the feature falls into reach, then it would not be worked on at that instant. Implementing a feature because I love how to engineer it is something that we have never done.

There are three specific traits that we look for when adding someone to our team

  1. The person should be more engineering driven in their mind-set. When I say engineering driven I mean that his software should do more work than human effort should.
  2. He or she should be an independent “tinkerer” i.e. he or she can work independently while working as a team and he or she can basically tinker with a problem statement.
  3. The most important one for the company is a get shit done attitude – getting up and saying that I can get this done and doing it quickly.

These three aspects are what we really care about and this is what our Instamojo culture is.

#PNHANGOUT is an ongoing series where we talk to Product Managers from various companies to understand what drives them, the products they work on and the role they play in defining the products success.

If you have any feedback or questions that you would like answered in this series feel free to email me at appy(dot)sg@gmail(dot)com. 

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14 Ways to Emotionally Engage users with your Product

Most conversations with entrepreneurs and product managers who want drive engagement and bring viral features to their products are answered as ‘We will gamify our product through features’. This post is about clearing some nuisance around the topic of gamification in products.

Gamification has nothing to do with building features. In fact, even Product Management has nothing to do with building features. It is not a rocket science, product managers usually figure out the ‘building features’ part of it with time and experience.

“People don’t buy products. They buy better versions of Themselves.”

So how do you ‘connect’ users with your product? Not through features, not through gamification, but by triggering certain emotions with your users.

Gamification = Getting People Emotionally Engaged with Product.

Below are some of the most powerful emotions people have along with few examples that will help you figure out how get users to emotionally engaged with your product / startup.
PS: The number of emotions could be more, I have referred to only 14 here.

1. Expression

Expression – People love to express themselves. Enable it.

Products that allow users to express themselves:

  1. Tumblr
  2. Twitter
  3. Facebook
  4. Medium

Products that allow users to express themselves anonymously:

  1. Secret
  2. Whisper
  3. FML

Tip: ‘Expression’ is used as a core use-case in product.

2. Acknowledgment

Acknowledgment: People love getting acknowledged. With interactions & endorsements.

Help people getting acknowledged. They love it!

  1. LinkedIn – Recommendations & Endorsements are social acknowledgments which users love.
  2. Twitter – Retweets and Replies on tweets are great way to be acknowledged.
  3. Facebook – Likes & Comments are acknowledgments to status messages users shares
  4. Quora – Upvotes & Comments is acknowledgment to your answers.
  5. Tumblr – Love & Reposts are acknowledgments to you posts.

Tip: ‘Acknowledgments’ lead to ‘User Notifications’ which further lead to Engagement. Always build features that enable acknowledgments in products that use ‘expression’ as use-case in product.

3. Exclusivity

Exclusivity or Privilege: People love being privileged. Make it exclusive.

Make it exclusive. No one likes the feeling of being left out.

  1. Gmail – Gmail invites were exclusive to few users. People were ready to buy invites off Ebay.
  2. Quora – Only existing users can invite new users.
  3. Pinterest – Users need to apply for access. After few days they were granted it.
  4. Mailbox – Users were in queue to get access to the app.

Tip: ‘Exclusivity’ works best for initial referral program for driving sign-ups.

4. Being Cool

Being Cool: People want to be Cool. People want others to know they are Cool.

Make your users look cool when they share your product.

  1. Frontback – Share a snap along with a selfie. Lets users be cool.
  2. Vine – Short cool creative videos.

Tip: ‘Being Cool’ will help you drive sharing on Social Networks.

5. Nostalgia

Nostalgia: People have memories. Sweet Memories. Remind them about it.

Remind users about some of the best times they have experienced.

  1. Timehop – Complete product is built around Nostalgia. Reminds users of special moments from the past.
  2. Facebook – 2014: Year in Review videos
  3. Twitter – 8th Anniversary: Which was your first tweet.

Tip: ‘Nostalgia’ helps get back old users and revives their interest. Can be only used once in a year on special occasions.

6. Curiosity

Curiosity: People want to know. They fear on losing out. Keep them curious.

Keep users curious. Keep them looking for more.

  1. LinkedIn – The feature ‘who viewed my profile’ tries to keep its users curious, and engaged.
  2. Twitter – Catching up with Timeline, mostly is the fear of losing out.
  3. BuzzFeed / UpWorthy / ViralNova – All try to trigger curiosity of readers through their post titles.

Tip: ‘Curiosity’ in products helps you increase repeat usage.

7. Competitiveness

Competitiveness: People love to compete with others. Creates a sense of achievement. Make it happen.

Drive users to compete with friends / others.

  1. Foursquare – The leaderboards between Friends was a great way 4SQ ensured people kept checking in.
  2. Quora – The feeling of ‘I have a better answer’ or ‘I can answer this question in a better way’ keeps driving engagement.
  3. Fitbit – Leaderboard that tracks your fitness with friends.
  4. Hackrank – Programming challenges.

Tip: ‘Competitiveness’ leads to greater engagement. Though its novelty in private group is lost after some time.

8. Stay Organized

Stay Organized: People love to organize things. Organize everything. Make it happen

Give users stuff that they want to sort / organize. Keep them busy.

  1. Pinterest – Lets you organize pins / interests/ stuff you love.
  2. Evernote – Organize all your notes.
  3. Wanelo – Organize fashion stuff. Ask girls how much they love doing this.
  4. Calendar / Contacts – They are always in a mess. Its a never-ending struggle to organize this. Google Contacts & Google Calendar help you keep them in place.

Tip: ‘Staying Organized’ helps your users spend more time in your product. It soon becomes a habit.

9. Importance

Importance: People love to feel important. Its about them. Their identity. They want to show off.

Make your users feel important about themselves.

  1. LinkedIn – My professional achievements., that is how a user sees it.
  2. Twitter – My views. My opinions., that is how a user tweets.
  3. FourSquare – Checkin is telling the world – I am here.
  4. About.me – This is me. This is my identity.

Tip: ‘Importance’, everyone wants to be important. The product usually ends up being shared, talked about – and results in others wanting to do the same.

10. Authority

Authority: People love to display their authority on a topic. Give them opportunity to do that.

Help create authority for users. Users want to be acknowledged as influencers by others.

  1. Quora – Authority by Topics. Asked to Answer is being authoritative.
  2. StackExchange – For programmers.
  3. HackerOne – For hackers.
  4. Hacker News – For Geeks.

Tip: ‘Authority’ is the importance others in a community or forum assigns to select users. Users want to be acknowledged as being authoritative, it helps increasing engagement and spending time on the product.

11. Visual

Visual: People love stunning visuals. Its a powerful emotion.

Visuals create impact in product. Don’t miss on it.

  1. Instagram – Personal Emotions.
  2. Flickr – Professional Emotions (yes unfortunately for Flickr).
  3. 500px – Photography community.

Tip: ‘Visual’ is a substitute to all unsaid emotions. Use well when your product is build around pictures and photographs.

12. Freebies

Freebies: People love Freebies. Badges. Credits. It all works.

Freebies work. Make use of them correctly.

  1. Quora – Credits users get when other upvote their answers.
  2. FourSquare – Badges for Check-in.
  3. Uber – Credits to Refer Friends.
  4. Facebook / Twitter / Google – Regularly use Advertising Credits to on-board new advertisers.

Tip: ‘Freebies’ – use it only for one purpose. Can be used for activations, sharing or driving engagement. Use it for one use-case that can measured.

13. Money

Money: People want to make Money. People want to receive Money.

Money is one of the strongest emotions. Portray it positively.

  1. Google Adsense – Opportunity for bloggers, individuals, publishers to earn money online.
  2. PayPal – Receive money from anyone.
  3. Elance – Get paid for free-time work.
  4. Kickstarter – Raise money for your projects.
  5. Gumroad – Make money by selling digital goods.

Tip: ‘Money’ – Receiving Money / Making Money is a positive emotion. Giving away is negative.

14. Sex

Sex: People want Companions. People want Dates. People want Sex.

Keep it simple, keep it safe.

  1. Tinder – Helps you find date.
  2. Match.com – Helps you find date.
  3. OkCupid – Helps you find date.

Tip: ‘Sex’ – It is more about selling the Hope. Keep the product simple. Don’t over engineer.

Concluding Notes:

When you build any feature, try to trigger a emotional engagement with user. If you are in early stage of your product development or in process of making your product roadmap, spent some time with this methodology – 15 Steps Towards Building a Great Product.

When it comes to including emotions in your product, ensure the following:

  1. Use max 2-3 emotions per product.
  2. Gamification is not about building features. It is about emotionally engaging a user.
  3. Don’t exploit users. Be subtle. Be good.
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A perspective from the other side – Seema Joshi, Lead Product Manager – BMC Software, #PNHangout.

In this #PNHangout, Seema Joshi, Lead Product Manager – BMC Software, shared with us her insights about Product management and the challenges and scope on the road ahead for Women Product Managers.

Why did you choose to be a Product Manager?

There are two aspects to why I chose to be a Product Manager. The first is related to the evolution of the Indian IT industry and the second my personal journey.

The Indian IT industry, after its beginnings in the 1980s, saw good growth in the 90s with the economy opening up primarily due to high cost arbitrage. During this time the industry was dominated by the services sector. In the 2000s, the industry was maturing rapidly due to economic downturn pressures and consequently margins were eroding and cost arbitrage decreasing. The services industry still dominated the IT sector as the cost arbitrage play was becoming increasingly competitive. We also began to see larger R&D centers, mostly captive, setting-up base in India. Now, in this current decade, the focus is shifting to total product ownership. With increased expertise as well as domestic markets, startups and VC eco-system expanding, product management is becoming a critical part of success. It is more critical than it has ever been. While we do have a growing leadership presence across companies in India from a R&D product and project delivery stand-point, product management and product leadership focus needs to be stronger to deliver great products to local and global markets through entrepreneurship or intrapreneurship. Product management clearly has a large role to play in shaping the course of the Indian IT Industry.

I am a Bachelor of Civil Engineering and I began my career as a structural engineer after graduation. While I loved my work building peoples’ dream houses, factories, bridges, etc. I knew that I was more productive and happier working with people. So, I took up an opportunity with eGain Communications- a product company in Pune in a customer facing role where, after sometime in this role, I moved to the sales team as I thoroughly enjoyed working with in a customer oriented role. We were a small team targeting new territories which meant wearing various hats from lead-gen, pre-sales, solution consulting, account management all the way to acquiring business. It wasn’t always easy, but it was challenging and educating work. After a few years in this role, I was offered a position in the product management team and the decision to move wasn’t difficult. I think I always was and still am a sales person at heart. So the proximity of working with customers to find solutions for their problems was important to me. At the same time, I had seen typical enterprise sales cycles span anywhere from 6-12 months. I now had an opportunity to bring to the table my experience of working with customers, their needs and expectations from solutions, etc. and, with the outside-in perspective to help build the product, I could indirectly contribute to getting business from a greater number of customers beyond my sales territories! The product management role was like a win-win.

It was both the opportunity and the challenge to be a Product Manager that got me into the role nearly a decade ago and it still continues to be my passion!

Great, you’re a Product Manager. So what do you really do?

I’m often asked this question and I have begun enjoying answering it, so much so that I have two versions of answers. For the people interested in a short answer I tell them – “As a PM I do lots of conversations using a ton of post-its, a set of lenses and glue.”

For the ones still with me, I tell them: a PM is responsible for the success of the product to maximize business value through the product’s lifecycle depending on the business goals—be it driving market share, revenues, customer retention or whatever the focus for that product might be in its life-cycle at that point. This requires a PM to have good understanding of the unsolved problems in the market to identify market opportunity. To do this effectively they need to bring out the post-its and engage with customers to understand problems in their context and what their pain points are.

They then need to use their short-term and long-term lenses to review this vis-à-vis corporate strategy, internal strengths, risks, funding, competitive landscape, etc. to come up with a business strategy to address the market opportunity and product strategy to build a kickass product.

With the strategy in place, they need to communicate with the entire value chain to help deliver this—right from exec approvals, working with engineering to build the product and with marketing to convey the planned product value, sales tools and processes to ensure sales is able to effectively sell to the right buyer and with support to ensure customers understand how to use the product in the desired way, etc. They need to be the glue between cross-functional stake-holders to ensure right execution.

Though a PM might not be responsible for each of these areas, it is very important for every Product Manager to still have what I call the imbibed-CEO attitude. You may not call the final shots in each case, but if you do not align and orchestrate various aspects while driving your areas of responsibilities, you might reduce the odds of your product’s success. A Product Manager really must be passionate and enthusiastic about everything related to the product to make it truly successful!

Managing a product demands multiple sources of information and skill. How can a Product Manager prepare herself for this role?

A Product Manager needs lots of post-its, glue and conversations as they do their daily jobs. Conversations are typically of two kinds—one in the listening mode to gather insights and the other communicating what to do and not to do and conveying value and ways to get there. The PM does not need to be the encyclopedia, but needs to know different ways to get this information that can go into the encyclopedia. It is really a mix of art and science!

There are recommended practices for the entire productizing process that can be used to source and communicate information effectively. Individually a PM can focus on some of the following to do this well:

  • Be a good listener: It is never about what the product can do. It is always about what the product can do for the customer. Engaging with customers and the market to understand problems in their context is critical. This involves being able to ask the right questions, understanding customers and their business and what their key pain points are as means is to identify pervasive problems.
  • Good domain understanding: It isn’t a pre-requisite for a PM to be a domain expert right from the beginning. However, to engage effectively with customers requires being able to do it in the context of their domain. So a PM needs to quickly get a good handle on how things work. Regular interaction with customers and prospects is definitely a great way to do this as well as following analysts and thought-leaders in the industry, tracking competition, attending industry events, etc.
  • Build an analytical approach to problem solving with a business-centric mindset: It is not about picking the first or the easiest solution or solving the problem of the noisiest customer. To derive the next set of outcomes, having understood the unsolved problems in proper context, requires being able to quickly analyze scenarios, potential opportunities, dependencies, financial implications, impact and mitigation plans. PMs need not be experts in each aspect but he needs to be able to evaluate options and work with the value-chain towards achieving business goals for which time and cost is critical!
  • Communicate effectively: Effective communication is the hallmark of a good PM. A PM is required to constantly communicate with various stakeholders to achieve a common objective i.e. to build a product that delivers value. For instance, a PM needs to communicate
    • Business opportunity and solution recommendations to execs for strategy and funding approvals
    • Product requirements to engineering to build the right product
    • With marketing to articulate solutions and convey the right value messaging
    • With analysts or customers to convey the solution and its value

If you fail to sufficiently communicate any of these, it could affect success!

  • Leadership and self-leadership: It is important for a PM to bring in the right vision, energize teams, influence, and be good at decision making for many a time it is about right prioritization and timely decisions. This cannot be done without passion for your product and its success. While good processes help reduce risk, even at an individual level, a PM needs to take charge and align and inspire teams towards their goals.
  • Belief, patience and perseverance: There are no two ways about it. In product management you’re in for the long haul. It is about a product’s journey towards success. If you want things to happen overnight, or view it just as a set of tasks from one release to another, you might end up taking the wrong paths. Keep the focus!

Women Product Managers – there are a few of them. Is it a disadvantage to be a woman?

Overall the gender diversity ratio in the Indian IT industry is approximately 25 % women, which is better than others. However, most women are still in traditional roles like HR and Marketing and to some extent engineering, technical-writing and delivery-centric leadership roles. The presence in product management and product leadership is still really small. In fact, in my 8 years of being a PM, both at my current and previous company, I have been the only woman PM in India. Of course it is a little different when it comes to global teams.

In India I have been on many forums and meetings where I am the only woman. Being a woman PM tends to have a two-fold challenge. For companies, organizationally, product management as a function is still not mainstream; it is getting better but it still isn’t there. This is further compounded by the lower women ratios overall and within the function.

One of the common challenges most Product Managers need to overcome is related to change—recommend change in strategy, change in practices to address opportunities, culture of organization, etc. If you’re the only woman in the room driving this, be ready with all kinds of data-driven reasons, proof-points and if-else conversations to make the change management smooth and effective to avoid “but, this is not how we’ve done it in the past” objections.

Beyond that, at a larger level, the challenge is a common one irrespective of roles—to have better diversity across hierarchies in an organization. If companies want to make a notable difference in diversity, it is crucial for them to cultivate a culture where women not only end-up taking more traditional roles like HR, Marketing, etc. but also actively encourage women to take up roles along technology leadership (as architects) or product leadership (product management and innovation) as we take the Indian IT industry to the next level AND if we don’t want women to be left behind once more time to only catch-up later!

I would also like to give a shout out to women in the industry to gear up for this and be prepared to play your part. Remember that what got you here won’t get you there and these days “lean is in”, so sharpen your skills to make a difference. For a better outcome tomorrow, it is a choice we have to make today—as individuals and corporates!

Is there a bright side for Women as Product Managers?

One of the key things for a Product Manager is to empathize with users and to care for the overall experience. Women tend to be naturally more attuned to this. They also come across as effective communicators and influencers. A PM needs to do a lot of communication as there are various stakeholders to be managed across ranks and a Product Manager has to be able to influence by bringing out the reason and value of why things need to be done the way they need to.

Being great at multitasking is a benefit as well. Recent studies are converging with the hypothesis that women are found to be better at multitasking than men. A Product Manager is always juggling between different things and different people and yet needs to keep all tracks aligned. It helps to be able to prioritize tasks, organize time and most importantly keep calm under pressure as they rapidly switch between activities.

Lastly, their leadership styles help too. PMs not only need to nurture a product from conception through its life-cycle but also drive larger teams towards a common objective without having any authority over them! This is corroborated by the increasing number of women taking up significant roles in corporations. Women Product Managers are definitely making a mark. Marissa Mayer’s growth from a great Product Manager to being the CEO of Yahoo is a testimonial to it. So there definitely is a bright side for women as Product Managers.

#PNHANGOUT is an ongoing series where we talk to Product Managers from various companies to understand what drives them, the products they work on and the role they play in defining the products success.

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Thinkflow Software – Keeping up with changing markets

I recently met with Thinkflow founder Praveen Hari and heard first hand their growth story of building a platform capable of powering business applications and services on the cloud. I specifically focused on learning how they accelerated their growth and scale phase, wanting to hear a few stories that could inspire other budding ventures on this path.

Handful of stories below highlight some points as key to the growth strategy they adopted and experienced.

Threat from Big Companies

Early on they realized that several bigger companies in the value chain of BPM applications began to change the game and build a larger product offering by acquiring small product companies in the chain. They researched this trend and began to use their insights of this industry and the trends that big companies were focusing on to pivot into a PaaS company.

Price point

First, they evolved the product offering from BPM to PaaS with better price point and working with smaller vendors / partners to build solutions and package professional services in much shorter timelines than bigger companies could offer.

Customer understanding

Next, having great customer insights was key to working this model. Solving customer’s business problems were paramount. As an example they realized the importance of Single Sign-on as a value point for customers and identified a way to implement this on top of the Microsoft Azure platform, which already supported multiple authentication modes. Using existing technology and simply working the core customer pain point was valued highly and resulted in building customer loyalty.

Multi-tiered approach & Partner with experts

Additionally they realized a need to build solutions that encompassed several domains. As they did not have all the domain knowledge and the best way to address was to partner with experts who had domain knowledge and have them build solutions on top of their platform. They focused on building a platform that could serve direct customers as well as application developers and enterprise developers. One such story began with a partner who realized the power of the platform and inquired whether they could build a workflow in the GRC space (Governance, Risk & Compliance). The partner ended up using 40% of the Thinkflow system to build this application.

Partnering with core platform

Being a Microsoft Preferred Partner definitely helps in continuing to evolve the platform and systems. One day Microsoft partner contact mentioned that there was a need to have a Document Scan & Capture capability that could help several enterprises. They rapidly implemented this functionality on their existing solution. It’s a win-win situation as Microsoft partnership provides them with insight that allows Thinkflow to add capabilities into their platformised workflow and potentially draw new clients.

Follow competition and trends very closely

The triad has continually encouraged teams to explore and record competitive and industry trends. They also attend the open webinars to learn about other products and solutions to discover trend patterns.

In addition to this Thinkflow constantly promotes its solutions and workflows through regular webinars they setup and also other forums. They find great value in events like the PNCamp, CIO meets, Tech50… Their belief is that such forums will help growth and visibility for startup ventures.

Summary of key takeaways

  • Use data insights for staying on top of market trends. Business environments change faster than you think.
  • Partner with vendors who can provide solutions at better price points.
  • Match customer pain points with existing technologies to build lasting solutions. Customer development is critical to building world-class products.
  • Scale multiple domains with expert partners to offer a plethora of solutions. Open your platforms to other solution vendors.
  • Form preferred partnership with large base technology vendors. The partnerships can provide great insights and leads to convert.
  • Promote your technologies & solutions in open forums.  Attend other open webinars to research competition, trends and potential partnerships.
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Hiring Is Growth Hacking

Hiring is Growth Hacking applied to organizations.

What does that mean?
It is expensive to pay a staffing consulting $10k – $20k per hire, so creative, guerrilla tactics have to be adopted. Using your network to reach out to your audience, relying on word of mouth, the referral program that extends beyond employees, Quora/Twitter/LinkedIn for lead generation, fancy videos and blog posts with great content, etc.

It can be harder for large companies to do real growth hacking, whether to acquire users or employees, for many reasons, some legitimate: agility, red tape, risk averseness, etc. But there are always inspired employees in these companies making an exception.

So how should one go about hiring like a growth hacker?

1. Double down on metrics
Draw out funnels for every channel you are sourcing candidates from. Measure success rates (define success explicitly: an interview accept? the actual hire?) and work on drop off points. Be ruthless about cutting out the underperforming channels, regardless of how cool they are right now. It is an optimization problem.

2. Growth is a culture
You have to build acquisition and retention into your product DNA. Same for your organization. Every employee should be an evangelist. Every employee should be helping with the hiring process.

3. Initial user experience
If the first interaction requires a prospective candidate to commit to a job search or going through an interview process, it’s an anti-hack. It’s why you choose to ignore those InMails. Elicit a “wow” the first time, then take it from there.

4. Spread success stories
Get new employees to update LinkedIn profiles, Facebook/Twitter statuses immediately. Ask them to blog about their first day. Show off internal successes.

5. Multi multi channel
That’s two “multi”s. Everyone is already multi-channel: they’re on LinkedIn, Quora, Twitter, StackOverflow, etc. Find more channels. Treat everything as a channel. Exactly why this is like growth hacking: the answers are not already available.

6. Create content
Content is one of the best ways to engage your audience. The Kixeye hiring video. The Facebook Engineering blog. Meet The Team sections on so many company websites.

7. Bootstrap
When you’re starting from zero, you have to bootstrap. An online education startup bootstrapped by creating courses themselves from publicly available course material. A local services marketplace bootstrapped by letting you type in any service you wanted, and then going out to find and sign up a provider for that service. An e-commerce selling diapers online started by fulfilling orders by buying diapers from the local Target store.

Got any more growth hacks that can be applied to hiring? Leave a comment, and I’ll add it to this list.

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Platform Metrics: the core metric for platforms, networks and marketplaces

You become what you measure. From my experience working with clients across enterprises and startups, the most common reason for failure and inefficiency is the focus on convenient, but inappropriate, metrics. Your technology doesn’t determine the business you build. Neither does your organizational capability. The metric you optimize for is the single biggest factor that determines which business you end up building.

Metric Design

The importance of choosing the right metric is more far-reaching than we often believe. A metric is a bit like a commander’s intent in an army. At battle, there are a lot of variabilities and unexpected contingencies which cannot be pre-planned for. The Commander’s Intent is a simple rule of thumb that helps soldiers take local, individual decisions towards a cohesive, larger goal.

Metrics work in much the same manner. Once you set a metric, the entire team organizes its efforts around it, and works relentlessly to optimize the business for that metric. It’s often fancy to have a large dashboard with multiple graphs tracking hundreds of things. But to be truly effective, an organization/team/individual should be solely focused on optimizing for one metric.

As a result, identifying and designing the right metric is critical for business success. More often than not, I’ve seen the following general observation to hold true:

If you’re asking someone to optimize for more than one metric, you’re setting them up for failure. 

Often, ratios help capture multiple movements in one metric. Whether you think of the financial ratios that traditional business managers track or the DAU/MAU that app developers relentlessly track today, ratios tend to be important as they explain concentration rather than quantity.

Pipe Metrics

This discussion of metrics is especially important in the world of platforms and networked businesses. Platform businesses are a lot more complicated than traditional pipe businesses. Pipes optimize unidirectional flow of value. Hence, metaphorically, releasing bottlenecks at any point should help with the flow. The Core Metrics for pipes, naturally, then, measure smoothness of flow and/or removal of bottlenecks. Inventory turnover is one such metric to check how often the flow of goods/services moves through the pipe. All forms of Output/Input ratios for intermediary teams on the Pipe are, again, checks to understand rate of flow and identify creation of bottlenecks.

Platform Metrics

But this tends to be much more complex in the case of platforms where flows are multi-directional. Moreover, they are interdependent because of network effects. E.g. optimizing activity on the producer side may have unexpected implications on the consumer side. On a dating network, allowing over-access to men may be unattractive for women. Hence, even if you have two different teams optimizing for two different metrics on the producer and consumer side, the activities of one team may adversely impact the pursuits of the other team.

How then does one go about deciding on platform metrics?

The Business Of Enabling Interactions

This takes us back to a theme I repeatedly talk about. If I had to condense the essence of Platform Thinking in one line, here’s what it would be:

We are in the business of enabling interactions.

This is much like the Commander’s Intent I mentioned earlier and has important implications. Irrespective of how big your firm is, how complex the operations are, the goal should always be to optimize the core interaction.

1. Identify the Core Interaction that your platform enables

2. Remove all bottlenecks in the Core Interaction to ensure that it gets completed across Creation, Curation and Consumption

3. Ensure that the Core Interaction is repeatable and repeats often

From a metrics perspective, this essentially means that the Core Metric that rules everything should measure interactions.

If you’re running a platform business, you need to start measuring and optimizing your core interaction. 

Metrics Design Around The Core Interaction

So we get the fact that we need to measure interactions. However, we still need a measure, a number that shows the Core Interaction is working well. As with all metric design, it is still possible to choose the wrong metric despite understanding the importance of measuring the Core Interaction.

To design the right metric, let’s revisit what the Core Interaction on a platform actually entails.

From earlier essays in this series, we note the following:

1. A platform enables exchange of information, goods/services, money, attention etc. between the producer and consumer. For a visual guide to how this works, check the article here.

2. The exchange of information always occurs on the platform. The other exchanges may or may not occur on it.The exchange of information enables every other exchange to take place. To understand the mechanics of this, refer this article.

3. The exchange of information is the key source of value creation across all platforms and can be visualized as the Core Interaction of the platform. To understand the structure of the Core Interaction in detail, check the article here.

4. The Core Interaction has three parts: Creation, Curation and Consumption of the Core Value Unit

Let’s now look at the different types of platforms and tease out relevant key metrics.

Transaction Capture

Some platforms capture the transaction between producers and consumers. These platforms typically track actual transactions. Platforms like the Amazon marketplace may measure gross value of transactions. Those like Fiverr (which have fixed value per transaction) may simply measure number of transactions. Airbnb tracks number of nights booked. This is a better indicator of value creation than simply tracking number of transactions. At the same time, it doesn’t care about value of transactions (spare mattress being booked vs. castle) as the goal is simply more value created irrespective of type of customer.

Transaction Tracking

Some platforms can track the exchange of goods and services in addition to capturing the exchange of money. ODesk, for example, can track number of hours of work delivered by the freelancer (producer), a key measure of value creation. Clarity.fm can track duration of the consulting call between an expert and the information seeker.

Market Access

Some platforms are unable to capture the transaction, the exchange of money. They create value by allowing producers access to consumers. In these cases, one of the common metrics tracked is the platform’s ability to generate leads. OpenTable specifically tracks reservations. These are not the actual transactions at the dinner table, but serve as a proxy for the value created. Some platforms may track overall/relevant market access. Dating and matrimonial sites often talk about number of women registered as that determines the value that a user can expect to get.

Co-Creation

One of the key properties of platforms is the fact that external producers can add value. Whether it is new apps on an app store, new videos on YouTube or new pictures on Flickr. In these cases, one is tempted to solely track these co-created Value Units. However, Creation forms only one-third of the Core Interaction. The proof of the pudding, in such cases, lies in repeat Consumption. Some platforms may track the total consumption, some may track the percentage of Value Units that cross a minimum threshold of Consumption. I tend to favor the latter as measuring and increasing the percentage of units that get minimum consumption ensures that the platform focuses on getting more producers who create relevant units that will be consumed. It also ensures that, over time, the feedback loops (in the forms of notifications to producers) will encourage creation of the kinds of units that get greater consumption.

Quality as Value

Some platforms may create value largely by signaling quality. Reddit is one such example where Curation is more important than Creation or Consumption. Such platforms may track reputation of users and create feedback loops that encourage users to participate often, gain karma and use that to participate further in the curation process.

Market Attention

Platforms where the Core Value Units are content e.g. YouTube, Medium, Quora etc., the engagement of Consumer Attention serves as a key metric. Measuring number of videos or articles uploaded or number of videos viewed or articles read is often not enough. These give indications of Creation and Consumption but not of Curation. We need some indicator of quality as well. This is why many such platforms track the percentage of content which gets a minimum engagement. Medium tracks views and reads separately indicating that it requires a minimum commitment from the Consumer to determine quality of the content.

The Easy Metric Fallacy

While working with companies on this, I’ve often noted the following:

1. Creation is the most common metric tracked. Number of apps, number of videos, number of sellers etc. This is misleading.

2. In the case of Market Attention category platforms, Consumption is the most common metric tracked. This is an improvement but still not a measure of quality.

3. Curation is rarely tracked and is often the most important metric that determines the health of the platform.

4. The measure of transactions that should be tracked varies with type of platform. In some cases, number of transactions may suffice, in other cases, volume of transactions may matter.

5. The metric that best explains interactions will change over the life cycle of the platform and it’s critical to identify points at which these transitions occur. Companies often make the mistake of sticking on with an older metric when their business has scaled. Identifying and vetting the Core Metric at every point is very important.

Counter Metrics

While measuring the platform’s ability to create interactions is important, it is equally important to measure its failure to close interactions. I will explore this further in a subsequent post.

The Way Forward

The discussion on metrics is deep and cannot be done justice in one post. I’ll cover this more as we move further in the series. The key point, though, remains:

On a platform, the Core Metric that rules them all must measure and optimize the Core Interaction.

Tweetable Takeaways

For platforms, the Core Metric to be tracked must measure and optimize the Core Interaction.Tweet

The goal of a platform is to repeat and optimize the Core Interaction that creates value. Tweet

This article was originally published on Sangeet Paul Choudary’s personal blog Platform Thinking – A blog about building early stage ventures from an idea to a business, and mitigating execution risk.

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Product Management Principles across industries are the same” – Pandith Jantakahalli, Sr. Product Manager – iPublishCentral. #PNHangout

#PNHangout is an ongoing series where we talk to Product Managers from various companies to understand what drives them, the products they work on and the role they play in defining the products success.

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We recently had a chance to talk to Pandith Jantakahalli –Senior Product Manager at Impelsys, about his experiences as a Product Manager and his take on the role of a Product Manager. Pandith is an MBA from The Indian Institute of Management Bangalore and is also a “Bangalore boy” having grown up in this city. Here is what he had to share with us:

The path to Product Management

My career has had three distinct phases. The first phase was in Engineering where I started as a software engineer at Sasken as part of a seed team which developed ADSL modems and then moved to increasing levels of responsibilities as an engineering manager. The second phase can be broadly classified as a business strategy role where I worked for Mergers and Acquisitions. Here I was an integration manager for a company that we had acquired while I was at Sasken and I also worked in business roles where I helped the executive team make decisions by analysing different situations and suggesting how they need to be done. The third phase is that of a Product Manager.

imagesWhat interested me in Product Management, after having done multiple roles both on the business and the engineering side, was a desire to understand the big picture and play a pivotal role in deciding the success of a product and it has been my passion and interest ever since.

Within this third phase I have had three stints. The first was for a product that I had initially developed which dealt with licensing ADSL technology. In 2002, when I took over as the Product manager, the licensing business model had died out. So the challenge here was to find a new business model for this product. In my second stint I worked at Mindtree where we developed a suite of video surveillance products. This product had been in development for over a year so the challenge here was to get initial customers. Currently I am the Product Manager for a product called iPublishCentral which is a platform for delivering e-books. This product already had a large customer-base so the challenge here was to scale revenues and increase profitability.  So I have been fortunate to see different products at different stages of evolution.

Gauging the pulse of iPublishCentral’s customers.

Fortunately for us, at iPublishCentral, we are strong in three segments: the society publishers, the stem publishers and the children’s publishers and what has worked well for us is our focus and referrals from our existing customers. It is a small world and we are increasingly realising that the sales hinge on referrals. Consequently most of our customers go back to existing customers for references to understand how we fare on various parameters. So even though we have a sales force in different geographies, the key for us has always been good references from existing customers which converts a prospective customer.

We have 4 to 5 different inputs for developing our roadmap for iPublishCentral. First is the feedback we receive from existing customers and prospective customers that we work with or we intend to work with. The second is through customer support that we provide for our publishers. This way we are able to interact with a publisher’s end customers and understand some of the pain points of our customer’s customers.

A third source is the various stakeholders within the company itself i.e. the sales team which talks to existing and prospective customers, the executive team, the product managers including me all regularly have weekly and fortnightly calls with our keys customers. You also have market and competition and you have an understanding of where the market is heading and what the competition is doing and we also have our own sense of what we feel is going to happen in the market and what changes and disruptions are taking place.

Based on these inputs we have our business goals, revenue goals, customer acquisition goals, customer satisfaction goals and we prioritize each of them. We then identify maybe five or ten things that need to be done to achieve each of these goals and these are then broken down into themes. Once these themes are prioritized we start working on individual features based on impact and that is how we broadly layout the roadmap saying these are the goals, this is where the market is going and this is the time horizon in which we want to get things done.

Product Management Mantras:

From a product management perspective, one of the core principles is to help a company achieve its goals by understanding why the customers are using or hiring your product. You have to be able to understand what job the customer is trying to do and you should have a solution that will solve that problem or help the customer accomplish that job in return for money, attention, etc. anything that the company can monetise. Most product managers do not have the luxury of infinite amounts of money to devise a way to monetize the product later. Very few companies are in that position. So the core job of a product manager is to understand how the company can make money by providing a solution that the customer is seeking and not only should you be delivering that solution, you should be delighting that customer because only when you delight the customer are they going to talk about you and you will have more customers coming in through word of mouth, etc.

Having worked in different industries, from the domain’s nature and the competitive nature of the environment – the business environment itself they are all going to be very different for different industries but from a core product management perspective these principles are nearly the same.

Constant Communication

One of the core challenges that I have seen across all my three roles in Product Management is having everyone in the team on the same page i.e. constant communication across different functions within a company in terms of what the priorities are and what needs to be done now in order to keep everyone aligned and have clarity on the goals. This is a challenge all Product Managers have to confront. This, however, also depends on the culture of each company and how they tackle this communication conundrum. Some companies prefer a written document which becomes the basis for all discussions which then gets continuously updated. The other way is to have regular stand-up meetings where all the outstanding items are discussed and only the key decisions are stored in a central place which all team members have access to. So there are various techniques and tools to keep everyone on the same page and depending on how things have evolved within the product you create specific ways of overcoming these challenges that work for everyone.

A + B + C combined makes a Product Manager

The key skills required for Product Management I would say are being able to communicate the vision of the product and ensure everyone on the team has clarity and vision of what the goals are, written and verbal communication skills, analytic skills, design appreciation, capability to get into the mind of a user and think on her behalf to deduce what would make the user happy and delight them. I am also becoming increasingly convinced that a background in psychology really helps because you have to be able to understand the motivations and biases of people and understand people, customers and your stakeholders really well. Saying no to things is another crucial skill to have because you will always have limited resources and a lot of things to do. In addition, being able to ship the product; you can keep trying to work on something, trying to get it perfect and not release it. As a Product Manager, you have to have the guts to take whatever you have developed to the market, get feedback, iterate and improve it. So it’s a lot of skills that are required but the core ones are more on the softer side.

Now Product Managers by nature are very curious people so they would try out multiple products. If you look at their tablets, it would have a lot of apps installed on it so they can understand what the product is about and they will be able to sniff out details which you think are really not important. If you ask them what their favourite product or service is, they will be able to exactly tell you why they like the product, 20 things they would do to improve it, constantly have ideas and above all they have a good attitude in terms of getting things done and getting along with people as they are very good at understanding people. People who do well understand the user, so people with a psychology background or a design background have an edge over those who think a little more analytically or logically. I believe a person with a lot of diversity or a person who has done a lot of roles would definitely do well in a PM role.

Any tips for aspiring Product Managers?

I am a believer in theory and reading books does help but actually doing the role of a PM is the best way to go about understanding this role. A Product Manager will always have a ton of work on their hands so the easiest thing to do is to talk to your own Product Manager to ask him how you can potentially help. Actually doing bits and pieces of a Product Manager’s role would give u a good feel of what a Product Manger does and you are, in turn, contributing to improving the product. Of course you will have to convince the Product Manager that you are capable of handling the role but a good PM would be able to arm out some piece of work which is both interesting to you and useful to him.

If you have any feedback or questions that you would like answered in this series feel free to email me at appy(dot)sg@gmail(dot)com. 

 

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

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

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

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

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

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

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

1. Idea phase

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

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

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

2. Product building phase

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

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

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

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

  1. Reach
  2. Revenue
  3. Retention

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

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

3. Business building phase

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

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

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

In simpler terms, business phase is all about growth:

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

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

Closing words

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

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

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

Reblogged from Sampad Swain’s blog.

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The Art and Science of Product Pricing

Product pricing is a touchy feely subject, hence the following disclaimers for I get into it…

  1. There is NO one-size-fit-all solution to your pricing problem.
  2. Don’t look for a one time silver bullet for product pricing.
  3. Pricing varies drastically between verticals, products, company stage, etc.
  4. This article is meant to give thought frame work around pricing and not a meant to be a perfect solution to your product-pricing problem
  5. Hence read this article and make it your own for addressing your product-pricing needs…

Getting the product price right is one of those ever elusive goals that almost all product companies are after. Companies undertake product-pricing activity for many different reasons, for example:

  1. New product introduction
  2. Updates to existing product
  3. Changes to sales / revenue targets
  4. Changes to product costing
  5. Changes to competitive landscape

Just like other product related activities such as product management, product development, support, etc., product-pricing activity should also be given its due time, resources and priority. Without thorough data driven process companies will find themselves not convinced about product pricing and end up going to square one again.

Hence before beginning on the product-pricing endeavor, here are some of the steps that companies should think about.

Again, a word of caution before I delve into various aspects of the framework given below… this is a simple framework, and companies should pick up the pieces that are applicable to them, as opposed to strictly following the process. I’m not a believer in blindly following any framework and neither do I promote it. I encourage companies to study various frameworks and then pick the one that they believe will benefit the most for their specific situation and then look into the application of it. I recommend that companies should not look for silver bullet or ‘one size fits all’ approach cause there is none!

Having said that, the first step in product-pricing exercise is to really nail down the reason for undertaking the exercise. Instead of CEO, Business head, Sales head initiating the conversation, it’s recommended that once a quarter there should be a pricing check point. There are a couple of benefits of doing that:

  1. Sales head can provide you with the market pulse on the manner in which competitors are positioning pricing and customer input on pricing
  2. Product Marketing Manager can share insights on changes in competitive pricing.
  3. As a team, companies can determine the circumstances under which pricing needs to be looked into on emergency basis. For example recently airlines suddenly started cutting their ticket prices, telecom operators slashed priced of Internet usage, etc.
  4. Identify any data collection tools that need to put in place or updated so that right data is collected on ongoing basis so that it can be used for objective decision making.

The discipline of having these conversations periodically helps companies keep an eye out for any ecosystem changes that might force them to think about changes to product pricing. In case the company has multiple products or product lines that are related to each other, then it becomes even more imperative to have these periodic checks. Through these meetings companies should be able to nail down if product-pricing changes are required and if, yes, what are the reasons for those.

Pricing Process
Pricing Process

 

It always helps to keep track of various industry best practices around pricing. This is an ongoing exercise. It helps you in understanding the following:

  • Industry rules and regulations specific to the industry vertical that company operates in. For example recently SpiceJet was pulled aside by government for selling tickets for Rs. 1
  • Accepted pricing norms in the industry.
    • Who pays for what?
    • Acceptable price range
    • Things that can be included or excluded from pricing perspective
    • Pricing transparency norms, etc.
  • Pricing models that customer / consumers are familiar with and can relate to.

The idea here is to get pulse of the eco system and understand what’s working and what’s not.

Know thy Customers! Understanding your customers purchase psyche is extremely crucial. You should know atleast the following things about your customers:

  • Customer’s perception about value of the product category
    • Is it a must have or a nice to have?
  • Buying process: The end-to-end process that Customers go through as part of product purchase.
    • How are budgets approved?
    • Who is the buyer?
    • Who is the approver or approvers?
    • How do customers compare products?
    • How do they use the product?
    • Which features matter to them the most?
    • How long is the buying process?
    • How far in advance do customers plan the purchase?
    • Payment recovery once the product is sold
    • Objections raised by Customers in the buying process
  • Customer segmentation: All Customers are not born equal. Broadly customers can be grouped into various categories. This categorization or segmentation can help in creating pricing models based on Customer’s ability to pay for and use the product. For example:
    • Volume (High / Medium / Low)
    • Global (Users from multiple geos using product)
    • Number of users (High / Medium / Low)
    • Bargain hunters
    • Smart cookies

Each of these segments should be studied in-depth so that product offering and pricing can be tailored to them.

  • Data capture: Customer segmentation can be done successfully only if data is related to customers is captured by Sales, Support, Marketing and product teams. Without this data, Companies may be flying blind and not know what’s working for them and what’s not. Typically, the longer time window data companies have to work with the better it is. In case, the of new product release, this may not be possible, but then put the systems in place from day one so that the data is captured from the get go. Companies can use CRM systems, home grown systems, etc., but they must use some system. Otherwise the data is lost in emails and permanently lost when folks move on from organization.

Then comes the Competition, the ever changing and ever present force that impacts various aspects of your business, including pricing. In order to consider competitive impact, Companies’ should first know the following:

  1. Who is the core competition?
  2. Competitions’ geo presence
  3. Who is the secondary competition and beyond that?
  4. What pricing models do they have?
  5. How big is their product adoption?
  6. Feature comparison
  7. How long have they been around?
  8. Pricing model presentation
  9. How often does the competition shows up sales scenarios?

The key here is to really use the competitive information to figure out the real threat that the competition poses in Company’s grown strategy.

Companies should really have handle on the product costing. Many companies in the B2C space create product and put it out there based on the way their competition is pricing the product. They assume that the pricing is such that they will be profitable anyways after a while. But this approach is suicidal! Because companies then one day suddenly realize that despite of high product sales volume, they don’t have a lot of margin and to be really profitable, they would drastically need to change the pricing or increase sales or cut costs.  A number of books have been written on product costing and it’s recommended that Companies should work with certified cost accountant for getting a handle on their product costing.

Product pricing is also a function on Sales and revenue targets. This is part of the top down approach of product pricing. A company can decide that they have to reach a certain revenue goal and work backwards from there to come up with an approximate price of the product. At this point they may realize that they have to price the product much higher that what the market is ready for or the other way round. In either case, the Sales team needs to be always involved in the pricing conversation, so that they can bring their market knowledge to the table. At the same time it’s necessary to note that they don’t use pricing as the reason for not being able to reach their sales target.

Pricing Models and Analysis is the most fun part of the product pricing exercise. This is where all the data that has been gathered internally as well as from external market is used for determine product pricing. Here are some steps that should be taking as companies try to come up with pricing model:

  • Identifying the key-pricing drivers:
    • By users (Customer Types)
    • By organization
    • By product units
    • By transactions
    • By functionality

There can be many more. Ensure that pricing is in line with the value the Customer is getting out of it.

  • Impact analysis: Every time changes to pricing / pricing model are suggested, impact on the following should be taken into consideration before rolling out pricing:
    • Existing customers (to grandfather or not)
    • Sales and support process
    • Revenue and Sales target
    • Profitability
    • Product buying experience
    • Acquisition of new customers
    • Product Management
    • Product Marketing
    • Product Engineering
    • Billing related changes
  • Pricing models: When coming up with product-pricing models, ensure the following:
    • Easy to understand
    • Easy to explain
    • Easy to pay (annual payment option)
    • Relates price to value (value driven)
    • Room for Sales to provide discounts (introductory offer, seasonal discount, regular client discount, one time annual payment discount, etc.)
    • Enables differentiation (charging for unique value as opposed to commodity)
    • Has low barrier to entry of first time users (freemium)
    • Has options for attracting large prospects (future customers)

Note: Void the word ‘unlimited’ in the pricing model wherever possible. Incase ‘unlimited’ word is being used, then should be explained in the terms and conditions.

  • Scenarios modeling are very critical to really understand the impact of pricing and pricing models. To do this, take existing customers and future customers and find out before and after impact. For example with current pricing Customer was paying X with new pricing customer will pay Y. Create real looking pricing page, rate sheets to understand the visual impact. Perform this activity for every customer segment and analyze the impact. Be especially sensitive about the impact on the customer segment from which the company is making large revenues. If this segment is adversely getting impacted then, the new pricing might have over all negative impact on the revenue.

Pricing roll out is equally, if not more as, crucial as the pricing model itself. A lot of internal and external training needs to happen before new pricing can be rolled out. Consider the following as part of new pricing roll out preparedness:

  1. Overall roll out plan with departmental ownership.  Timing of rolling out of pricing changes is critical. Make sure that it’s not in or just before the time when you get the most orders (busy season, if there’s one for Company’s business). There is enough time to explain changes as necessary to the high value customers.
  2. Marketing:
    • Website
    • FAQ
    • Pricing collateral
    • Checkout process (if there is one used for online purchase)
    • Video (why is the change being made and how it impacts you – the customer)
    • A-B testing readiness
  3. Product:
    • Incase there are features that need to be added to ensure correct pricing
  4. Sales and Support:
    • Updating sales and support process
    • Training sales and support team
    • FAQ (internal and external)
    • Special process for High Value customers
    • Process for breaking the news
  • Email
  • Phone
  • In-person

5. Setting benchmarks: It is essential to capture benchmarks before rolling out new pricing, so that impact of pricing can be checked objectively. Here are some of the benchmarks to that can be captured:

  • Lead Generation benchmark
    • Number of leads / week / geo
    • Average deal size by vertical
    • Type of leads (lead mix)
    • Lead sources

6. Sales and Support Cycle benchmark

  • Time to close deals
  • Competitive references during price negotiations
  • Number of price discussions when closing deals
  • Feature usage by customers
  • Number and type of support queries

7. Revenue and process benchmarks

  • Revenue by Geo and by Vertical
  • Revenue by Customer segment
  • Changes to customer segment mix

Once the pricing is rolled out, either to pilot group, or to everyone, the impact of pricing must be tracked. There are a number of ways to track impact:

  1. Collect the KPIs and compare them against the benchmark
  2. Get on call / emails with customers to get their reaction
  3. Use the data from A-B testing to track change in customer behavior
  4. Take corrective measure as necessary
  5. Keep track of macro-economic changes as well, which may coincide with pricing rollout.

So before you take on the pricing exercise, ensure you the have time and resources to do justice to it…

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Tools to make your life easier as a Product Manager

If you are a product manager like me, working at a startup, you are already wearing lot of hats and always finding scrappy ways to get things done. On a typical day you help define the roadmap, spec features, triage bugs, analyze experiments and shephered launches. Now, How in the world do you maintain your sanity while being on top of all these things? For me the answer has partially been found in the set of tools which I use on a daily basis.

Workflowy

Use for: Note-taking 

As a product manager I’m always taking notes whether it be over a quick feature discussion, the customer feedback session or quickly jotting down a piece of information. Over the years I have used Microsoft OneNote, Evernote, Trello and many other softwares along side some clever ways like writing emails to myself, but in the end none has stuck

But I turned a corner. Nearly an year ago, when I discovered WorkFlowy —so far— it seems to be the best note-taking and organizational program I’ve ever tried. This app is the easiest, best-designed, and most-flexible note-taker I’ve ever come across, and it solves many of the problems I’ve had with other software. In the year I’ve been using it, it has become one of two tabs that I keep open in my browser, along with Gmail.

Get it: https://workflowy.com/

Easel.io

Use for: Rapid Prototyping 

As a product manager, who cares deeply about user-centric design, I like to create clickable prototypes of the features I work on, to get a sense of how the feature is going to be used by the end-user. With Easel I can import elements from existing sites, make a clickable prototype and get feedback from all the stakeholders pretty early in the product development life cycle.

Get it: https://www.easel.io/

Awesome Screenshot — Chrome Plugin

Use for: Capturing screenshots, annotating pages

As a product manager I end up taking lot of screenshots, be it for reporting defects, researching other products for ideas or simply specifying a feature request. After trying a number of options, I’ve opted for a handy little plugin for my Chrome browser, which stays at my fingertips at the top of the browser, and lets me snap a whole page (beyond the fold and everything) or snips of the screen.

The result is loaded in a new tab, complete with tools to annotate, black/blur out sensitive information, and draw all the red arrows and squares I desire.

From there, the screenshot can be copied to your clipboard, saved to your computer, printed out, or shared with a variety of other services like google drive.

It’s fast and useful, and has never given me reason to complain. Plus it’s free.

Get it: Awesome Screentshot — Chrome Web Store

UsabilityHub

Use for: Quick, anonymous feedback

UsabilityHub gives you 3 tools each enabling you to post images (or a series of images, in the case of Nav Flow) and gather feedback from random users over the web.

It works on a virtual currency called ‘Karma’ — you can earn Karma by doing tests posted by others, or you can pay to buy Karma in bulk. Ideally, you can run through a handful during lunch break to earn just enough to spend them on tests in the afternoon.

Get it: https://usabilityhub.com/

ProdPad

Use for: Defining Roadmap, Spec features, Creating Personas 

As a product manager alongside taking notes, rapid prototyping, taking awesome screenshots and gathering quick, anonymous feedback you need to come up with rock solid product roadmaps, be able to define personas and spec out feature details and share it with people across the board.

ProdPad is the only proper Product Management Software that allows you to gather ideas from your team, flesh them out into specs, outline your products and your product lines, and put it all on to a Product Roadmaps.

Best of all, it also has packages that will fit your company, whether you’re a startup or whether you’re part of a huge team with a big product portfolio.

Get it: https://www.prodpad.com/

Of course, this list is by no means exhaustive, and there’s plenty of room for debate on which other tools offer a better experience, richer feature set, or more attractive pricing. I look forward to finding out in the comments.

Guest Post by Chetan Kapoor, Product Manager working with SuperProfs.com design and engineering team. Serving as a linchpin between product management, engineering and customers to ensure that product is developed in a way to maximise all stakeholders success and contribute to SuperProfs.com overall strategy. Twitter – @kapoorcs

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Indygo – Customer Acquisition Tips

I met Srinivas Yermal from Indygo. In the conversation he chronicled his journey as an entrepreneur in India.

Opportunity knocks from up-close

He happened to chance on an opportunity that started from his close network. His chartered accountant once asked if he could help build a practice management solution that would help maintain his growing business. Out came Papilio.

indygoBreaking the product

As the first product grew legs with many features being added per customer needs Srini realized that the product could be split up into multiple products because several clients were asking for parts of the solution. So they ended up splitting the product into 3 parts to cover task management, invoicing and compliance management.

Understand customer acquisition – referrals are golden

The professional CA community is a tough market to penetrate. Through interactions Srini found that this community in the past has been burnt through bad software solutions implemented and hence the professionals are hesitant to invest in new systems. Cold calling almost never works here. In this situation customer acquisition is more solid through a process of referrals. Most of these referrals are not direct but subtle and happen in the course of direct interaction and networking within the professionals – such as peer auditing activities that connect 2 firms provide deeper exposure to product features than a sales call would have. Srini thought of building an active referral function into the product but realized that the implicit referrals are more effective than direct referrals that provide no material incentive to existing clients.

Customer partners can expand customer demographics

Srini mentioned that through his direct clients he was introduced to another demographic of potential clients, “Clients of their Clients”. Through his direct clients he was introduced to manufacturing units that become clients. Even the professional secretarial firms that service the core CA client community of Indygo became clients. Each of these client demographics had some different core needs but Indygo is able to service these varied needs.

Partnerships

Engaging partnerships are a good way to share and expand opportunities and product offering. However a word of caution when selecting partners that are either too small or too big as the difference in size could affect the goals. A large partner may not see significant value in an integration.

Summary of key takeaways

  • Breaking up a product offering into smaller chunks could help in building up a larger manageable portfolio. It may also help in servicing different client demographics.
  • Deep insight into customer perspectives can help build products & features that solve the need and avoid feature bloat.
  • Customer referrals esp. implicit referrals that can expose product capabilities more deeply than a cold sales call would go a long way to acquisition.
  • Clients of customers can also be potential customers and enable a path to expanding the market.
  • Partnerships are best when there is common need for additional value at both ends.
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Future of Mobile Apps

The future of mobile apps is linked to how humans have evolved and communicated with tools.

Consider an inverted pyramid as shown in the image above, with two dimensions growing simultaneously. The first being awareness and the second inter-connectivity. Awareness can also be perceived as manual vs automatic interactions with little input from user. Inter-connectivity is communication between apps or devices. When considered with the number of apps available in the market today, it is a straight pyramid with the bottom of the pyramid containing a lot more ID aware apps than the top with very few self-aware apps. When considered with the dimensions awareness and inter-connectivity, it is an inverted pyramid.

The bottom of the pyramid contains apps that are all about empowering the individual in ways to communicate, shop, purchase, consume etc. This is driven by understanding each user (business or consumer) and is largely driven by attributes of the user. For e.g. location attribute. These are the apps that we are exposed to currently. Let’s call these “Identity Awareness” apps as they are all about empowering one’s identity with the use of apps on mobile devices. The communication is similar to a hub and spoke model where the user is the hub and the apps are spokes.

How can the apps evolve from here? One possibility is where the apps shall enable “Situational Awareness”. As a small example, why should the owner of the device set their mobile on vibrate mode or silent mode? Why can’t the app figure it out by looking up my online calendars and determine the right mode? Initially, the apps may take advantage of naturally or publicly available data such as time of day, precise location of the user, etc. Aviate (getaviate.com), the company that was recently acquired by Yahoo is a good example of situation awareness. It automatically reorganizes your apps based on time of day and user behaviour with apps. Imagine the possibilities with more situation awareness eventually recognizing user cognition.

The top of the pyramid in the evolution of apps shall enable “Self-awareness”. Analogous with spirituality, self-aware apps shall realize greater interconnectedness when working with Internet of Things. In this case, not only are the apps situation-aware, but also can communicate with other peer apps and orchestrate to optimize your world in real time.

Couple this development with the trends in miniaturization and convergence of hardware devices and the future of mobile apps looks more integrated into human lives, providing naturally expressive extensions of user’s perceptions.

 

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The Services Industry moved India back 20 years in terms of building Products” – Arvind Jha, #PNHangout

In 1986, when I graduated from IIT Kharagpur as a Computer Science major, I had picked up an obsession with building products. Soon after college, I had joined DCM Data Products. DCM like other players in the Indian market, were very focussed on product development, as the product culture for designing computers, or writing compilers, etc was prevalent in that era. We as any other product company at that time were focussed on the fundamentals, such as, what a product should do, who would use such products, how we would market the products and how are we going to support such products.

As the outsourcing business kicked off in India, in 1991, the focus had suddenly shifted to a services mind-set where the question had suddenly changed to how efficiently and effectively can we utilize the 40 man hours in a week. The focus in the industry had pivoted from building a product to becoming a programmer, from market access to talent factories. Although India had built a 100 billion dollar services industry in this time period, we had also effectively moved back 20 years in the product industry.

Market Understanding is the key to building products

I had joined Polaroid – the leader in instant and chemical photography in the late 90’s. I had first-hand seen a how a dominant market leader was blindsided by major disruptions. Polaroid had a tough time adapting to the shifting consumer trends towards digital. The company had spent lot of time and resources in converting film’s to digital and digital to film, however, what the executives did not see that the Polaroid, was that film had no chance to survive in the digital medium.

MusselsEventually the company filed for bankruptcy and was sold. I had moved on earlier to Adobe, a company that was a leader in the software product space and was just setting up shop in India. Adobe was a solid product oriented company, with a lot of innovative products and a lot of leverage in the market. We had almost 5-10 million users for each products, and just sitting in on such big products gave us a huge amount of education. The challenge we had against was, could we build a product culture at the India office. The opportunity came after a couple of years after working as extension teams to the major products. We got the opportunity to “own” a full release of PageMaker. Since the core team was busy with building InDesign 1.0, PageMaker had been neglected and revenues were declining as the ecosystem of operating system, creator applications, graphics, printing etc had moved on. The task was to update the product on an “old” and complex code-base with minimal resources such that the revenue decline could be slowed down, enough to give InDesign a good chance in the market. We identified a lot of opportunities in the usage workflow, which our competitors did not take advantage of. These along with in numerous byte sized elements that had incrementally improved the product allowed us to present a case to the executives. The management had fortunately agreed to take on this mammoth task of transforming page maker. It turned out that the PageMaker 7.0 release increased the revenue 1.5x times and extended the long-tail significantly far in excess of the expectations.

The Innovation Bug

When you get hooked onto new and innovative stuff it gets harder do the maintenance sort of stuff. I started Adobe Connect, and also Adobe Enterprise Effort. Adobe in India had however at that time moved its focus in maintaining some of its older products, and I had then decided to move away to join a video start-up and learn how to build a product and a business from grounds-up, with a view to move to my own start-up in 3-5 years. The start-up was in video play-shifting, a similar solution to SlingMedia, where a user can take a video signal and encode it, and using a wire transmit the signal remotely to where the he is. We implemented a local area, wi-fi based video streaming and a peer-2-peer protocol for tunnelling video to a remote user. We got a NASSCOM innovation award for this product. However, one of the founders of the company had a tainted record with an IPO/investors and though we had great technology and user traction, it was impossible to raise funding unless the founder was removed from the company (which he did not want to let go). Since I was directly involved in meetings VCs and investors at that stage, I felt that the possibility of collateral damage to my professional reputation was very high given the founders manipulations and therefore I decided to exit from the company to launch my own start-up.

We launched Movico where we tried to establish ourselves in the video transactions space. The idea was to build a tool that would allow content owners to build scene based metadata and indexes for their video collections and we would offer tools for the users to extract, join, create new content online. In hindsight, we were way ahead of our time and especially after the 2008 economic turmoil, the funding needed to build the product and business had dried up. We had to can the product and look for alternate ways to keep going. So we turned our strategy around a bit, went into OPD services, built a reasonable revenue base and started looking at mobile apps.

Filmy Filmy!!

A couple of years ago, my friends started a mobile distribution company, Lava, focussed on brining tech/manufacturing from China and building a distribution brand in India. They did rather well and scaled the business to top 5 local Indian brand level within 18 months. In 2011, they asked me to help setup a smartphone team/capability for them since it was clear that android was going to be  huge disruption for the phone business. I got the chance to understand the phone ecosystem – from chips to software. I could see that for Lava to be successful in the smartphone space, we would have to move into a premium zone. So I helped build an Android R&D / competency centre. This attracted the high-end players to speak to Lava. One such player was Intel, who were looking to get into the phone business but not finding any takers. I realized that Lava could gain significantly with Intel as a partner. The profile could change. We negotiated to bring the Intel technology to the market under a new brand, Xolo, pitched as a premium brand with “Intel Inside” (Xolo today is a well known brand by itself).

The association with Lava had given me some useful insights into what the Indian consumer was looking for, and based on this I decided to move away from the device side to focus on building a portfolio of apps that were primarily in the content space – News, Film, Movies, Songs, Indian books and Indian Magazines. My gut-feel is that once the smartphone pricing falls under Rs. 2500 level (I expect this to happen Q4 2014) the demand for consumption of this Indian/local/regional content will be large and we can build a large digital media business powered by apps/server side technology. Although we had many competitors in these areas like Gaana.com, we knew that our expertise with video, content algorithms, focus on integrating new technology to deliver consumer benefit would win in the long run.

An example of this is our app “Filmi Filmy”. The market has over 7-10 major hindi film music apps. However, none of them have a great video experience.  At the same time consumption from YouTube has been growing rapidly. Content owners have published over 10,000 free movies and over 30000 free songs to YouTube. Using some smart algorithms and our video technology expertise, we have launched the first ever chitrahhar-on-the-go app, Filmy Filmy. It brings your favourite film songs with the original film tracks for you to enjoy in video. And we plan to build an ecosystem around this – sharing playlists, screen shots, quizzes, memes – ideas to engage the users and let them create new content. Make the video transactional (going back to our Movico idea).  I’m happy to say that within 3 weeks of launch, we were the top new music app in India. We were featured at #8 in the indian app store in the music category in India and #1 in Pakistan. We are currently grossing over 1000+ downloads/week. Soon we will have Android and Windows version of this app ready.

Innovative Business Models and Market Understanding is Key

With Filmy Filmy, we have implemented unique business models built around in-app purchasing. We knew right from the outset that this was not an App we can charge a premium for. Even if we went down the advertising route, we would need close to 4-5 million downloads for the product to be sustainable. Hence, keeping this in mind, we went down the in-app purchases route, that allows users to purchase and create his own own playlist and share this with his friends. For example, on Valentine’s Day, we had allowed our users to create a playlist to express his emotions and share this with his beau. We were quite interested to see that this model had gained quite a lot in terms of traction and revenue.

We currently target the Indian Diaspora, such as the Middle East, SEA, etc. We provide limited content access for free, but we monetize through some innovative means. Product Managers usually play an important role in understanding the market and identifying the right channels to monetize this content. My passion is to be ahead of the market so I am always trying things. Sometimes it works, sometimes it does not. But the team has a fun time all the time.

India as a Product Nation

A lot of young companies come to me saying, that we are doing an Indian version of a US business model. What sorely seems to be lacking in the pitch is the consumer profiling on how their unique solution will tackle a real world problem. I believe that one is to one direct modelling of US business models may not work. I would much rather here a pitch from an Indian company which states that they have the market insight to say that there is a large enough need in our Indian Audience, and our solution can meet that need in an innovative way. The focus should change from “we can do it” to “we know this about the Indian Consumer”. However, I’m very excited that the product industry has now matured and is no longer learning to walk, we’ve reached a point where we can run.