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Crossing the Chasm vs. Spinning Up the Web

Berkeley >Play October 29, 2011


Venture Agenda: High-Tech Market Development Models  B-2-B Markets – Crossing the Chasm

 B-2-C Markets – Spinning up the Web

 Comparing Critical Success Factors – Chasm vs. Web

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Crossing the Chasm B-2-B High-Tech Market Development

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Technology Adoption Life Cycle Pragmatists: Use it when it’s ready!

Conservatives: Make sure it’s ready!

Visionaries: Be the first mover!

Skeptics: Never happen!

Techies: Try it!

Innovators

Early Early Majority Adopters

Late Majority

Laggards

Pragmatists’ view of whole product maturity drives the adoption of new technology.


The Whole Product

Outsourcing Hardware

Complementary Services

Application Engineering Installation and support

Software

Core Offering

Design

Complementary Products Peripherals

Databases

M inimum set of products and services to fulfill target customer's reason to buy.


Market Development Model Offers Evolve with Whole Product Maturity Standard products for pragmatists with budgets

Main Street

Proven systems for cost-conscious conservatives

Tornado

Early Market Chasm Custom projects for Visionaries

Bowling Alley

Segment-specific solutions for pragmatists in pain


Crossing the Chasm Framework A Playbook for B-2-B Market Development Pragmatist in Pain

1. Target Customer 2. Compelling Reason to Buy

Complete solution

3. Whole Product 4. Partners and Allies

Can manage complexity

Rewards for all parties

7. Competition 8. Positioning

Next growth segment

Ready to fill in the gaps

5. Sales Channel 6. Pricing

Current alternatives

Broken m/c process

Differentiating focus

9. Next Target

And that’s how you grow a B-2-B market! 7


Spinning up the Web B-2-C Digital Market Development

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Identity Modification Life Cycle Engagers: Check it out!

Reluctants: Wait!

Evangelists: Believe in it!

Rejecters: Beware!

Enthusiasts: Be 1st to try it!

Innovators

Early Early Majority Adopters

Late Majority

Laggards

Engagers create the dynamics of digital market development


Brand/Identity Interactions* Levels of Engagement & Commitment Level of Engagement

Level of Commitment I will camp out all night to be first in line when you open. I will go the extra mile to play a part in your world. I not only purchase your offers but display them proudly. I select your offers over others whenever they are available.

D

I never imagined this was possible. You are reshaping my identity.

C

You express my dreams, and I want to do more to help your cause.

B

You are part of what I am. By choosing you, I express myself.

A

I respect what you do, and believe what you say.

* Model developed in collaboration with Schireson Associates

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Spinning Up Volume Operations on the Web Running Experiments in Tandem

ACQUISITION

VIRALITY

Starter Motor

MONETIZATION

ENGAGEMENT

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Spinning Up the Web Metrics that Will Drive Your Programs  Grow Acquisition – Rate of gaining new users (velocity & acceleration)

 Grow Engagement – Average length, depth, and frequency of user engagement

 Grow Virality – # of new customers coming from existing customers over time

 Grow Monetization – Percentage & amount of participation, plus rate of change

 Increase Promotional Productivity – Yield relative to acquisition, engagement, virality, monetization

 Reduce Churn – Rate of losing existing users (velocity & acceleration)

 Increase Lifetime Customer Value – DCF value to date, plus rate of change

And that’s how you grow a B-2-C market! 12


Critical Success Factors Crossing the Chasm vs. Spinning up the Web

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Critical Success Factors What Venture Investors Look For Crossing the Chasm

Spinning Up the Web

 Disruptive technology

 Distinctive cool factor

 Compelling reason to buy

 Leveraged access to market

 Customer domain expertise

 Web-tech expertise

 Whole product focus

 User experience focus

 Agile services-led offer development

 Agile data-driven product development

Different horses, different riders—same trail! 14


Thank You gmoore@mdv.com #crossingthechasm

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Berkeley Digital Media Conference