| Marketing new products and services is vital for most | | | | categories low and focus on going deep in each |
| companies. Many marketers, however, are unaware | | | | category. You can always substitute different |
| that fast, low cost guerrilla techniques for market | | | | categories in subsequent calls with different people. |
| concept testing can easily replace cumbersome | | | | Again, after three or four calls you'll have a much |
| market research, saving lots of money and time in the | | | | better idea of which categories of information are the |
| process. | | | | best for your purposes. |
| A Simple Model For Strategic Thinking | | | | Step 3: Create A List of Potential Customers |
| In order to test a new market concept you need to | | | | The next is interacting directly with your market. This is |
| have one, right? Use this simple, intuitive strategy model | | | | a hugely valuable exercise for product managers, |
| for understanding the dynamics in the marketplace | | | | marketing managers and marketing leaders. You'll learn |
| you're considering. At first you simply work through the | | | | more about your market concept in a day of doing this |
| model applying what you already know or strongly | | | | than just about anything else you might choose to do, |
| suspect is true about the market. Then you go back | | | | including conjoint analysis and focus groups. |
| and support each and every assumption you're holding | | | | The objectives for this stage are: |
| with market data. | | | | understand who holds the knowledge you need |
| - What are the trends in my industry? | | | | understand the role each influencer will play in a |
| - What's driving these trends? | | | | complex sale |
| - What are we currently doing about the trends? | | | | understand where, when, how and from whom |
| - What are our competitors doing about the trends? | | | | they get their decision influencing information |
| - What could we be doing about the trends to | | | | The people you need to talk with can hold one or |
| increase our profits? | | | | more of the following roles: |
| During this process you're squarely in the analytical | | | | Decision maker |
| phase of marketing. You're creating ties between your | | | | Influencer |
| idea and a market that will welcome or reject it. Do | | | | Approver |
| your work carefully at this stage or you'll wind up with | | | | User |
| every marketer's nightmare...a product or service that's | | | | Deal killer |
| an answer to a question nobody's asked! | | | | With some products and services, mostly consumer |
| Collecting Unbiased Customer Data | | | | products and B2B products costing less than $1,000, |
| There are a couple of ways to approach this task. It's | | | | you'll be talking straight to the decision maker. With |
| recommended that you use both methods so that | | | | most other products and services you'll be talking to |
| your information will be balanced between primary | | | | the decision maker plus one or more of the other |
| (straight from the customer) and secondary | | | | types of buyer. If you're not familiar with the |
| (conclusions from experts). The objective here is to | | | | mechanics of a complex sale you'll need to pause the |
| clearly understand your WOW! and how you'll prove it. | | | | project until you're caught up. Just do a search on |
| The first thing to understand (and many marketers | | | | 'complex sale' and you'll find what you need to know. |
| don't) is that business is a social process. Which | | | | This is critical for B2B and higher-end or more complex |
| means, to do this successfully, you'll be spending the | | | | consumer products and services. |
| bulk of your time dialoguing with people...not noodling | | | | Your objective is to talk to at least 100 people who |
| around on the internet. If the thought of this provokes | | | | have direct influence on the purchase of this market |
| anxiety you're in good company. Most people don't | | | | concept you're testing. If you're testing a consumer |
| relish talking to strangers but successful people in just | | | | concept (for example tax preparation software) start |
| about every profession just bite the bullet and do it any | | | | talking with people in your circle of influence including |
| way. | | | | friends, family members, colleagues and professional |
| Step 1: The Internet Part | | | | contacts. You will qualify your research participants |
| To establish a beachhead, and not duplicate effort, | | | | based on who prepares his/her own taxes and |
| spend about 10% of the time you've allocated for this | | | | whether a software product is used. Once you have |
| project internet research. The objective is to gain a | | | | the list and their telephone numbers you're ready to |
| baseline understanding of available information about | | | | move on to Step 3. |
| current offerings and substitutes in this market space. | | | | If you are testing a B2B market concept you must go |
| You also want to understand the various marketing | | | | straight to the companies to whom you'll be selling your |
| and sales channels. It's especially good to know about | | | | products or services. You may have a few contacts |
| substitute choices your prospects could make instead | | | | in these companies but you'll spend the bulk of your |
| of buying your product. It's good to look at the whole | | | | time talking to people you don't know. Be up front |
| chessboard, not just the squares immediately | | | | about your mission and never disguise yourself as a |
| surrounding your next-move. | | | | student doing research for a term paper or project. |
| At this stage we're looking for available industry | | | | Just be yourself and be honest in describing what |
| reports and similar expert analysis of: | | | | you're doing. |
| What are the trends in my industry? | | | | If you're cold calling a company start where you can |
| What's driving these trends? | | | | get a foothold. If your market concept is a new and |
| What are our competitors doing about the trends? | | | | better alternative to traditional inventory control |
| You'll find out what's available by doing these | | | | systems in mid-tier manufacturing companies, likely you |
| searches: | | | | will be talking to people in logistics, purchasing, |
| 1. [industry name] or [product/service] or [major | | | | operations and accounting. Go to the company's |
| competitor], financial analysts | | | | website and list the names of key people in those |
| 2. [industry name] or [product/service] or [major | | | | functions if they're identified. Then call the main number |
| competitor], market research | | | | or department number, if listed, and ask to speak to |
| 3. [industry name] or [product/service] or [major | | | | that person. You may get through or you may not. |
| competitor], Hoover's | | | | Regardless of whom you talk with, even if it's the main |
| 4. [industry name] or [product/service] or [major | | | | switchboard operator, just give him/her your 25 word |
| competitor], [name of local newspaper] | | | | elevator pitch on what you're doing and ask who |
| 5. [industry name] or [product/service] or [major | | | | they'd recommend speaking with. |
| competitor], business news | | | | You will find that after calling three or four companies |
| 6. [industry name] or [product/service] or [major | | | | your comfort level will rise dramatically and you'll start |
| competitor], industry news | | | | getting through more often to people who have the |
| 7. [industry name] or [product/service] or [major | | | | information you need. |
| competitor], industry experts | | | | Summary |
| 8. Run similar searches on your favorite social media in | | | | This sounds like odd work for marketing people |
| case those entries were not picked up by the search | | | | doesn't it? However the advantages of this approach |
| engines. | | | | are many. |
| If something about your subject has been written, pod | | | | First, it gets marketing people immersed in the |
| casted, YouTube'd, tweeted, blogged or discussed at | | | | marketplace. This is far better than the superficial |
| a conference you will find it with these searches. Sift | | | | practice of having marketing people shadow a sales |
| through what you find and plug each piece of key | | | | person for a day or two once a year. |
| information into the 5-point strategy planning model | | | | Second, it gives marketing people an affinity for the |
| we're using. Now you'll see a shape starting to form | | | | role of the sales team. It helps them understand selling |
| around your strategy model. | | | | so they, in turn, can work with salespeople on devising |
| Step 2: Create A Discussion Guideline | | | | strategies to overcome resistance and objections. |
| This is what you will use as a guideline in talking with | | | | Third it gives marketing people solid confidence and |
| potential purchasers of your market concept. In | | | | much more enthusiasm for introducing new concepts if |
| essence this is the heart and soul of your project. The | | | | they have discovered the marketplace dynamics and |
| care and accuracy you put into this step will determine | | | | purchaser habits and practices. This confidence will |
| whether your market concept test results are | | | | spread to other areas of the company, giving the |
| accurate. | | | | marketing and product teams more support than they |
| These are the objectives: | | | | would have otherwise. |
| 1. Understand whether your WOW! is really a WOW! | | | | So yes, it's a truly different approach but it's highly |
| 2. Understand industry and purchasing trends related to | | | | effective and takes a lot less time and money than |
| your market concept...and what's driving those trends. | | | | traditional market research. |
| 3. Establish a view on growth opportunities for your | | | | Case Study |
| company or division. | | | | A startup company in California has a new market |
| We recommend that you structure your guide so that | | | | concept for virus protection solutions for iApp (applets |
| it results in a discussion. People are more likely to | | | | for Apple's iPhones) vendors. This startup is reluctant |
| loosen up and talk freely about your market concept, | | | | to spend $50-100K on formal market research so |
| and the alternatives, if you're not reading questions | | | | they've decided to do the project in-house. |
| verbatim as in a market research survey. Sketch out | | | | They plan to assess the current competitive |
| five key areas of information that you want. These | | | | landscape for iApp virus protection by: |
| might include: | | | | Conducting a search for iApp virus protection |
| What do you think about the concept I've | | | | vendors, if any |
| presented? | | | | Interviewing a small number of current iApp |
| Steer them toward their thoughts on advantages | | | | creatorso Do the trends they're seeing suggest a |
| and disadvantages. | | | | market opportunity for our concept?o What do they |
| Ask them what would make it even better. | | | | know about current solutions on the market?o How |
| What are the substitutes or alternatives including | | | | would our offering solve a current problem or pain |
| do-it-yourself and in-house solutions? | | | | point better than other offerings?o What would they |
| How, when and where do you like to receive | | | | pay to solve that problem or pain point?o What level |
| information on new products and services such as | | | | of disruption or complexity can the organization handle |
| this? | | | | for installation and testing? |
| Digital | | | | Next, the startup will assess current substitutes for |
| Traditional (print ads, trade shows, telesales, etc.) | | | | their concept. They'll do this by conducting a search |
| Colleagues, friends & family | | | | and gathering product specifications, distribution models |
| Where and how would you most like to purchase | | | | and other key information for each of their potential |
| something like this market concept? | | | | competitors. Some of this information they will already |
| Steer them toward what's the ideal venue for | | | | have from collecting customer data from the internet |
| them, not just where alternatives are available today. | | | | and other resources they used. The rest of it they will |
| You're seeking every competitive advantage you | | | | need to go after using the same information gathering |
| can get. | | | | techniques. These are some possible insights gained |
| Would terms such as financing influence their | | | | from their efforts: |
| purchase decision? | | | | Their new market concept would need feature |
| Who is the final decision maker and who else is | | | | adjustments |
| involved in making a purchase decision? Refer to your | | | | Their new market concept would be targeted at |
| notes on complex sales and remember that large | | | | iAPP creators only |
| consumer purchases can often involve multiple | | | | They can lean heavily on digital marketing rather |
| decision makers and influencers. | | | | than traditional marketing |
| It is critical that you not approach this exercise with | | | | A utility pricing model (pay based on consumption) |
| pre-conceived notions of what your company can or | | | | would give them a strategic advantage |
| can't do. You simply want to visualize the best possible | | | | A unique guarantee would give them a strategic |
| purchasing scenario for your new market concept. | | | | advantage |
| You can parse internal strengths and weaknesses | | | | Acquisitions would not be a source of competitive |
| later. Do not base a go/no-go decision on your | | | | advantage near term |
| weaknesses! | | | | The team now has enough information to make a go |
| You may think of many other categories of questions. | | | | or no-go decision. If it's a "go" the next step is to make |
| Just remember that most people will limit your time | | | | sure there's plenty of money in the bank, or coming in, |
| with them to 15-30 minutes so keep the number of | | | | to fund development and commercialization. |