About Me

Michael Kapp has 20 years of high tech product marketing and product management experience and is currently VP of Marketing and Product Mgmt. for Control Solutions, a leading supplier of Enterprise Mobility  Solutions and Automatic Identification and POS equipment.  

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Wednesday
Dec302009

Webinars as a Demand Generation Tool

Webinars can be an important element of your marketing mix.  Unlike advertisements or email blasts offering a white paper or inviting people to learn more from visiting your web site, a webinar requires a meaningful commitment of time from a prospect and provides an opportunity to make a personal connection. The webinar viewer will listen to your company's subject matter experts for 30 to 60 minutes, and will hopefully develop a favorable impression of the presenters and your company.   The webinar offers a non-threatening environment to learn and ask questions without having to commit to a dialogue with sales reps.  

Ingredients for a successful Business to Business demand generation webinar are as follows:

1.  Compelling Topic

The webinar must provide an opportunity for the audience to learn something that will be beneficial to them and their business.   Typically, a successful webinar will provide information that will help a company to raise revenues, increase efficiencies, or reduce costs.   Thus, the webinar topic, title and description should be customer oriented (benefits focused) versus vendor oriented (product sales focused).

2.  Subject Matter Expert and Credible Source

The presenter or presenters should be subject matter experts in the topic addressed by the webinar.  The presenters must be capable of providing useful information to the audience that they do not already know. They should be capable of fielding a variety of questions from the audience regarding the topic.  

If the Subject Matter Expert and/or your company is not well known within the industry, it may be beneficial to enlist the help of a third party to participate in the webinar.  While this could involve additional cost, it may also be critical to generate the registration volume objectives for the webinar.  The third party could be a respected trade journal, that can provide a moderator for the webinar and also help in promoting the webinar to its electronic newsletter subscribers.  Another common technique is to have an industry consultant participate in the webinar to provide the latest research results that may be complementary to the topic.  Either way, having a credible source add their name and prestige to the webinar can dramatically boost registrations.

3.  Educational Focus

This initial (demand generation) webinar must be education focused.  A more detailed product presentation or demonstration can come later in the sales cycle.  Typical objectives are to convey beneficial information to the webinar viewer/prospect, create a desire for the prospect to advance their investigation of a product or service, and position your company as a credible source to provide the same.

The webinar topic should be narrow enough so the material can be covered in the allotted time - typically 30 to 45 minutes which will also allow time for questions.  The material must be specific and detailed enough so that the audience learns something that will be truly beneficial (not just 50,000 foot level material that may be obvious, already well known, or easily obtainable through web searches).  Adding real world customer case studies and ROI's will provide valuable material which is unlikely to be found elsewhere - while also highlighting successes that you have had with other companies.   

4.  Administrative Excellence

It is typical that only 40% of the people that sign up for webinars will actually attend the webinar.  To maximize the number of attendees from the registration list, several best practices should be followed:

a.  Send an email providing detailed instructions immediately after registration

b.  Send reminder emails a few days before and again one hour before the webinar

c.  Send a thank you email to all who attended and a link to the recorded webinar for those who were not able to attend.  

5.  Lead Follow-up 

Last but certainly not least - get all the contact information from the webinar registrations (both the attendees and non-attendees) to your sales force.  Include any information from qualifying survey questions that may have been part of the registration form.  Your sales force can now contact these prospects to move them further into the sales funnel. 

Wednesday
Dec032008

Adapting the New Product Development Process to a Small Company

Most leading companies follow a structured and highly disciplined approach to new product development. These programs are normally modeled along the lines of Robert Cooper's  Stage-Gate TM or PRTM co-founder Michael McGrath's  PACE TM(Product And Cycle-time Excellence) processes.  These processes are particularly effective at filtering a broad range of new ideas or initial product concepts into a portfolio of thoroughly vetted and properly resourced product programs.

The common features of such NPD processes are 1) a review board consisting of the heads of the departments that provide resources to development programs, 2) a core team responsible for managing the development implementation consisting of individuals of various functional departments, 3) management reviews that take place at significant milestones during development, and 4) clearly defined objectives and deliverables required at each milestone/management review.

Normally, the development process is divided into named stages, with the management reviews being the gates between stages.  Decisions at the reviews would typically be to move forward into the next stage of development, kill the program, or re-direct back to the current or previous stage with specific defined objectives for stage completion. 

New Product Development ProcessLarge companies have much to gain from following such processes.  But what about smaller organizations?  In reality, it is even more important for smaller companies to be vigilant in allocating their limited development resources.   Practical accommodations, however, will need to be made when adapting the NPD process to a small company.  Some of the more substantial considerations are as follows:

1.  No Product Manager/Limited Resources for Market Analysis 

In most small companies, there will be no dedicated product manager or product management resources will be severely limited.   This can affect the process in a number of ways.  The product manager is normally responsible for writing the business case/plan, market research/analysis, competitive analysis, pricing, and researching/documenting product requirements.   In a study published in the Journal of Small Business Management, market analysis and market testing of new products were determined to be key to successful new product development, and these were the areas where small businesses were found to be most deficient.   It is therefore critically important that these activities are not glossed over.

In a small company, there will normally be a product champion on the management team.  This person will most likely find it necessary to assign some of the product management/market analysis tasks to other individuals to accomplish.  For example, the detailed documentation of requirements may be divided between multiple individuals who know the requirements best - these individuals could be in engineering, technical support, sales, marketing, etc.  

2.  Smaller R&D projects

R&D dollars are more scarce in a small company.   Relative to larger companies, these R&D programs are more likely to be smaller in size, duration, and/or complexity.   Many of these programs will not warrant the overhead characteristic of classic NPD implementations.   In such cases, development stages can be combined so that there will be fewer management/gate reviews.   Stage-Gate TM has recognized this need and advocates the use of their truncated Xpress and Lite processes which are designed for simpler programs. 

Small companies can be quite resourceful at adapting a process that fits their business model and specific needs while maintaining the most positive aspects of the traditional NPD processes.  I have had success with a software development process were we routinely covered two releases in one management review meeting - for example, first covering a schedule review and launch preparations for the upcoming release, and then reviewing the feature priorities for the next release.   

3.  Less Defined Company Strategy

With many small companies, a company strategy either does not exist or is very informal.  It is important that the CEO and management staff develop a strategy and clearly communicate it to all individuals involved in the product development process.  The strategy provides a basis for consistent and rational decision making, and a focus for the company's limited development resources.    

4.  Small Development Groups 

Smaller development groups will have implications for the core teams brought together to manage a product through the development process.   Normally the core team consists of one member from each functional area. However, these teams may necessarily be smaller if various functional areas are combined (for example, engineering and testing).   In addition, a small company's limited development staff may require that the same team manage multiple products.

One advantage of being small is better lines of communications.  There are typically less barriers to communications between departments in a small company and more opportunities for management to stay connected with all developers.   In a recent software development that involved a total of three programmers, I invited all three programmers to attend the management/gate reviews.  This was beneficial in many respects, including having a fuller range of technical assessments and opinions during the reviews and communicating the decision making process further into the organization.  The bottom line was greater buy in and confidence in the product direction and development priorities.  

 

Sunday
Nov022008

What is the Chasm and How Do You Cross It?

For over fifty years, researchers have used the Technology Adoption Life Cycle model to explain the adoption of new products and technologies.  The process of adoption is illustrated by a classic bell curve, divided into four consecutive stages.  Each stage is defined by the customers that adopt the technology in the respective stage: early adopter, early majority, late majority and laggard.

Geoffrey Moore, in his book Crossing the Chasm, was the first to identify the chasm between the early adopters and the early majority customers when dealing with discontinuous or disruptive innovations.  

The early market is characterized by visionary customers who have a passion for introducing new technologies to seek competitive advantage.  These visionaries are willing to accept the risks involved with new technologies and are often willing to devote considerable resources to working with the early product.  These early adopters have a clear understanding of the problem that they intend to solve with the new technology and they need little help from vendors in developing the ROI.

In contrast, the early majority customers, or pragmatists, are more risk adverse.  They want to be early into the market, but only after the technology has been proven by others.  They need to see a clear ROI, and will look to their industry peers, who have experience with the technology for validation.  They are more demanding that all components be completed and fully integrated, so as to minimize their own resource investment in implementing the new technology.

So, why is there a chasm?  In short, the vendor has not yet created the conditions necessary for adoption by the early majority customers - who remain unconvinced.   On the other hand, many of the visionaries have purchased, and there are not enough remaining visionaries to sustain market growth.

It is not uncommon for a new technology to take several years to cross the chasm, and in many cases, the chasm is never breached.   Retail bar code scanning is a case in point.   From the initial supermarket pilot, it took almost a decade to achieve broad market acceptance.   Many factors needed to come together to form the compelling ROI required by retailers, including a UPC (Universal Product Code) standard and governing body to assign UPC codes, product marking by a majority of consumer goods suppliers, point of sale system integration, improvements in scanner throughput, reliability and scanner cost reductions.   The improvement in system pricing accuracy was also a contributor, as this allowed for cost savings from individual item price removal.  

Another example is the pen computer industry.  Momenta, and a host of other first generation pen computer companies failed to cross the chasm in the early 1990's and ultimately went out of business.  These early products were expensive, bulky, and suffered from limited battery life and poor handwriting recognition software. Many years later, more focused products with a pen user interface, such as the Palm Pilot, Palm Treo, and a variety of Microsoft Pocket PC/Windows Mobile powered devices succeeded in crossing the chasm.  In addition, full size Tablet PCs are now crossing the chasm, with success in vertical markets such as healthcare, insurance and real estate.

These examples give clues to the strategies needed to cross the chasm.  Pragmatists require a complete solution, with minimum reliance on their own limited resources for implementation and little risk that the ROI will be achieved.  Therefore, the key requirement to achieve the chasm crossing, is what Moore refers to as the "whole product solution."   Building a whole product solution requires that all components are in place and fully integrated for the customer's environment, including hardware and applicable software with all critical features available, system integrations, pre and post sale support and related services.  The product/system must be demonstrable with plenty of favorable references for validation.  

Strategies that are essential for building the whole product solution and crossing the chasm are: 

1.  Reduction in Scope (Niche Marketing)

It is better to focus resources on one target market and achieve a whole product solution, rather than work on a number of target markets and have 80% of what is needed in each market to cross the chasm.  Focusing on a single niche gives the resource team a realistic opportunity to identify and develop the feature requirements, services and other components required to succeed in the targeted market.  The narrow focus also allows initial installations to more easily serve as reference accounts for others in the targeted market and facilitates word of mouth marketing. 

2.  Quickly Capture the Lead Market Share

Pragmatists want to improve their odds by working with the market leader and choosing the technologies/products that are most likely to become industry standards.  In fact, their risk aversion often cause pragmatists to develop a "herd mentality" in support of the market leader or emerging industry standard.  It is therefore important to capture the market leadership position during the early market, as this will help to ensure the leading position as the market achieves mainstream volumes.  

3.  Alliances

The building of a "whole product solution" could require alliances with providers of content, technology, software, or services such as contract manufacturing, installation or repair services.   Often outsourcing part of the solution to a partner will be a faster and more cost effective way to get to market, while maintaining ownership over the core or higher value activities.   Partnerships may also be used to build or strengthen sales channels.

4.  Marketing Support

Marketing materials that will be beneficial in moving the pragmatists/early majority customers forward will be case studies (written and video), solution briefs, ROI examples/business cases, and a list of positive reference accounts.  The company should focus on building awareness in the targeted market through trade show exhibiting and frequent marketing communication (newsletters, eBlasts, webinars, etc.)   Areas of market leadership and major wins should be highlighted as this should have the desired impact with the early majority customers.    

 

Thursday
Jul312008

Success in the Suicide Cell

Many product managers are familiar with the Ansoff Matrix, although they may not know it by name.  The matrix provides a simple framework for analyzing growth opportunities, using the dimensions of markets and products.   As one moves from existing products and markets to an adjacent quadrant, risk increases.

The most risky quadrant, labeled diversification in the matrix, is where a business introduces a new product into a new market.  Also called the suicide cell, this quadrant represents the highest risk of failure.  Some analysts estimate that the probability of success in this quadrant is as low as 5%.

The obvious message for business is to stay out of the suicide cell.  This is echoed by Geoferry Moore in his Crossing the Chasm bowling alley analogy.  Moore advocates growth by aiming for adjacent pins - introducing another product into your existing market or finding a new market that also needs your existing product with minimal modifications.

However, despite the odds, there will always be companies operating in the suicide cell.  Startups often introduce new products in a market that they are just entering.  Likewise, established companies can not resist the temptation of developing a new market, which they will hope to dominate, based on the promise of a new technology.   The tremendous rewards that come to those who succeed will ensure an endless rush of companies into this high risk zone.

So how can we improve our odds when introducing a new product/technology into a new market.  I suggest that there are four critical factors necessary for success:

1.  Long Term Commitment/Staying Power

When introducing a new product into a new market, it is important to have realistic expectations for the time and resources required to be successful.  This is even more critical if new technologies are involved.   In this environment, there are a lot of unknowns.  There is a good chance that the business plan will underestimate the risks, the competition, the investments required, and the time required to achieve profitability.  It is therefore important that the management team has a long term commitment to the endevour and access to funding sufficient for the long haul. 

2.  Implement Tactics to Quickly Learn Market Requirements

Key to success in a new market is understanding the requirements of a new set of potential customers.  Being new to the market yourself, this is especially difficult.  You will need to understand the industry and major players, gain access to them and master the industry jargon.   The quickest way to do this is to hire one or more employees with experience in the targeted industry.  Targeted market research,  trade show attendance, industry associations and partnering with other companies already in the industry will also be helpful in getting your company up the learning curve as quickly as possible.

3.  Create a Whole Product Solution

Borrowing from Geoffery Moore again, it is always important when introducing a new product to create the whole product solution.  That includes the supporting integration services, after sale support and services, application software, etc. that will be needed for customers to achieve the desired return on investment.  While early adopters and visionaries may be willing to devote substantial internal resources to fill in the gaps of an incomplete solution, the mass market will require a more straight forward and easy implementation.   A classic case of this is Apple's I-Tune store, which was a necessary ingredient for the meteoric success of the Apple I-pod.  It may be necessary to enlist partners to create all of the components of the whole product solution.

4.  Build Credibility in the New Market

You may have a great product and still not be gaining traction due to lack of credibility in the new market.  Customers are more trusting of the established players, and either are not aware of your company or are afraid to take a risk.  In addition to a targeted marketing strategy that includes consistent trade show exhibiting, and other marketing elements such as email blasts and direct mail, there are two excellent strategies to gain credibility.  The first is to establish and publicize success with important reference accounts.  The second is to partner with other companies that have already earned credibility in the market.  I have had success with this strategy in my current company.  We recently entered a new market and alligned with the leading accounting software companies in the industry to resell or refer our software.  The strategy accounted for more than half of our revenue in the new market.

Hopefully, you will find this posting to be helpful.  If you have achieved success in the suicide cell, please share your story. 

 

Tuesday
Feb262008

Building a Foundation for Successful Marketing

Just as a house needs a solid foundation, successful marketing programs leverage core (foundation) elements that have been previously developed.  In any assessment of your marketing capabilities, I recommend that you first start with the following three foundation elements:

1. Brand and brand promise

In today's environment of advertising and marketing message proliferation, brand is even more important than ever.  Gaining awareness requires repetition of a consistent message.   The goal is to not only build awareness of your brand in your industry, but also to create a positive impression, or brand promise, associated with the brand.   This can not be an idle promise.  The brand promise must be reinforced by the experience of your customers in interacting with your product and with your employees at all customer touch points.

It is therefore important to evaluate the brand and related promise.   What is the promise, or desired impression that the brand is to convey?   Does it provide sufficient differentiation from competition?  Are there multiple brands in the company, and are they all necessary?   Does the brand (name and logo design) itself convey a professional image?  Would a tag line be useful to supplement the brand name/logo?   Are there guidelines for brand usage to enforce consistency and maximize awareness?

Once you are satisfied with your brand, logo design, tag line and related brand promise, then you should be consistently using the brand in all marketing collateral, advertising, web site pages, direct mail, e-blasts, etc.   The message/promise of your brand should even be carried through in telemarketing, sales proposals and with all support people that deal directly with customers.  It is important that all employees are aware of the brand and brand promise, and understand how they can reinforce the message when dealing with customers.  Successful maintenance of the brand promise with existing customers will directly lead to stronger customer loyalty.

2.  Company web site

In today's world, people increasingly look to the internet for information.  Your company web site displays your brand, brand promise and important information about the company.  It is your company's face to the world, telling the company's story and promoting its products.  The web site is available 24x7 for prospects to visit in their own time - many of whom are not ready to engage with a sales rep.  

The web site serves as an entry point for leads coming into the company.  When properly search optimized, a web site can be a powerful magnet for attracting visitors who are searching for products or services such as yours.  Visitor information can be captured as leads through a registration form (required for access to additional information) or the "contact us" page.

Finally, the company web site fulfills a support role for many other marketing initiatives.  All marketing collaterals, direct mail, electronic newsletters, even stationary and business cards reference the company web site for more information.  The web site is the natural place to post information about upcoming events and seminars, with convenient online registration.  It is a repository for past newsletter editions and press releases. 

It is critical that objectives are defined for the web site during the design phase.  The brand promise should be prominent and clearly understood.  The quality and professional image of the web site should be consistent with the brand promise.   Depending on your objectives, there may also be a focus on online ordering, customer service, customer education, etc. 

3.  Customer/Prospect Database

It may come as a surprise that the company's customer and prospect database could be considered a marketing foundation element.  It is a fact that existing customers and prospects that have had previous contacts with your company will be the most receptive to your marketing messages.  There is already a relationship established, which could include being set up already as a vendor in the customer's purchasing system.  It makes sense to direct your marketing messages, direct mail, electronic newsletters, telemarketing, seminar invitations, etc. to this group.

The database should include both phone and email contact information, in addition to an industry designation to allow for more targeted messages.  The contact names may come from your company's enterprise system, or from a CRM (Customer Relationship Management) system in use by your sales force.  It must be cautioned, however, to avoid e-blasts to prospects that have not provided opt-in permission for emailing. 

Your customer and prospect database is one of your company's most important assets.  By marketing consistently to this base, including providing useful information and offers, you can develop better brand recognition/product awareness, increase customer loyalty, and generate additional sales and cross selling opportunities.   The net result will be an increase in revenue per customer and increased sales productivity for the sales force.

In closing, most marketing initiatives will leverage at least two, if not all three, of these foundation elements.  With these core underpinnings in position, you are ready to maximize the effectiveness of your marketing programs. 

 

Sunday
Jan132008

When to look for an Alliance?

Two of the most prevalent reasons to form an alliance or strategic partnership are for a) access to technology and b) access to markets.   NCR's alliance with Spectra-Physics in the mid 70s to create the in-counter checkout scanner was an example of both - Spectra-Physics brought technology to the partnership while NCR brought access to the retail markets.  The result was a product that dramatically increased productivity at the checkout and cemented the leadership positions of both NCR and Spectra-Physics (now Datalogic) in the checkout scanner market to the present day.

It is often said that there is nothing more risky than a company entering a new market with a new product.  In such a case, it significantly reduces risk by partnering with a company that already plays in that market.  By aligning with such a partner, it not only provides access to the partner's current customers, but the endorsement by the partner also provides additional credibility to the product within the market. 

Another related reason to strike a partnership is to build a "whole product solution" needed to break open the market.  There were many MP3 players in the market prior to Apple's entry, but it wasn't until Steve Jobs put together the deals with the major music companies to offer legal downloads for 99 cents, and the resultant iTunes site, that the whole solution came together.   The result was a dramatic "crossing of the chasm" and rapid growth in the mass market driven by the Apple Ipod. 

The building of a "whole product solution" could require alliances with providers of content, technology, software, or services such as contract manufacturing, installation or repair services.  Often outsourcing part of the solution to a partner will be a faster and more cost effective way to get to market, while maintaining ownership over the core or higher value activities.  There are few decisions more strategic than determining what part of the value chain should be maintained as core and what should be outsourced.  This is an important exercise which will require an assessment of long range scenarios and an understanding of the future source of value/profit.

 

 

Sunday
Nov252007

Four Criteria for a Successful Patent

Having recently posted the Signature Capture case on this web site, I thought that it would be a good time to share four criteria for a successful patent.   It was my responsibility at NCR to determine which patent applications to pursue in order to protect the signature capture concept and the market that was expected to emerge.  While we built a portfolio of about 15 patents, there were obviously some patents that were much more critical than others, and several that ultimately proved to be worthless.  Nevertheless, the result was an effective patent portfolio, with NCR owning the intellectual property for this space.

Many companies can not afford to build a portfolio of patents.  The initial cost of obtaining a utility patent is typically $10,000 or more.  Even filing for a single patent can be a financial burden for a small company.  With most studies showing that 90% or more of all U.S. patents have no commercial value, the decision to pursue a patent should be made carefully. 

I offer these four criteria in evaluating the decision to pursue a patent.

1.  Economic Value

The product or feature concept must have the potential of generating profit margins several times over the cost of the patent application and lifetime maintenance.  If you are not sure whether a market will develop for the product or if enough of the product can be sold to generate sufficient returns, then you may want to apply for a provisional patent.  This application can be done for a small cost, and effectively "holds your place" for a year, giving you additional time to study the market before filing the full non-provisional patent.

2.  It is Core (Can't Compete in the Future without it)

The goal is to cover an entirely new concept, so that no one can participate in the new market/product category without infringing the patent.  If the patent is for a new feature or modification to an existing product concept, then the feature must have a strong possibility of becoming a requirement in the market.  In other words, future versions of the product are expected to be non-saleable without the new feature.

3.  No Viable Alternatives 

Will your patent represent the only viable alternative to implement the concept or feature?  It is no use pursuing a patent if there are several other ways to achieve the same thing - unless, of course, you are planning to patent all of them. Make sure that you have a competent patent attorney help you with your claims - covering both apparatus and methods.  You want to leave no viable alternative which will allow a competitor to participate in the market/product category without infringing the patent.

4.  Infringement should be Easily Detectable

Even it you meet the first three criteria, you may still decide not to pursue the patent if you will not be able to tell if a competitor is infringing the patent.  This is especially the case with software or firmware.  Will you be able to determine  infringement from simply observing the product in operation?  If not, will you have a workable plan to obtain competitive products and determine infringement?  Will you need to examine a competitor's source code to determine infringement?  If so, how will this be done and at what cost? 

I typically want to see all four criteria being met to justify a patent application, especially in a small company setting where a patent application represents a major financial investment.  Using these four criteria, you can increase the probability that your company will achieve a financial return on the patent.  

Saturday
Nov242007

Where Do Good Product Ideas Come From?

Good ideas can come from customers, product managers, engineers, salespeople, technical support staff, or really anybody in your company.  Generally, a good idea will solve a problem or fulfill a need, whether current or anticipated, and its implementation will provide a benefit which preferably can be quantified.   A good product idea therefore is often a result of good problem understanding. 

So how do you identify and understand problems or unfilled customer needs?

First, you need to get out to see the target customers - in their environment.  This could be an informal visit or tour, or it could be part of a more structured market research project.  While on site, it is advantageous to talk to as many people as possible, in a variety of roles.  It is possible that the higher level people may not be aware of all the problems in their organization. 

It is important that you are open to listening and observing.  Now is not the time to be selling.  You are asking about problems and looking for opportunities.  Some problems may exist but are never identified as a problem because "it has always been done that way."  If the customer is not aware of a better solution, they may not consider their current method to be a problem.  They may also have a need that is being filled, but not to the extent that a newer, enabling technology will allow.

This brings us to the next point - perspective.  You bring a different perspective to the scene, which will also be different from other people within your own company. So it is beneficial to have a variety of people from your company visit customers to observe and listen.  And by all means, solicit thoughts and ideas from those individuals (salespeople, technical support, customer service) that interact with customers on a regular basis.

Many companies today focus on a vertical niche.  This gives them the advantage of focusing their time and attention so that they can more completely understand the customer's environment.  This will yield solutions that fit better into the environment and have features that may solve multiple problems or fulfill critical needs.

If your company is trying to play in too many markets, you may find that you are getting beat by competitors with more focus on the vertical, and a as a result, are implementing better ideas at a faster rate.