Most of us in the start-up world have read ‘Crossing the Chasm’. In the absence of a Go To Market strategy developed by an expert - it can be used as a guide for an early stage company.
I summarised here how to do so – to save you reading the book (!) I’ve turned it into a Strategy Roadmap.
“If you leave your customer’s success to chance – you are giving up control over your own destiny.”
First revenue will be with “early adopters” – technology enthusiasts (Visionaries) – who need a lot of consulting and extra design on the product. They will require pilot projects – extra development work etc., - however they prove the value proposition of the product.
Even for visionaries, the company needs to spell out clearly the order of magnitude jump in benefits – (I.E., prove beyond doubt it is a break-through product) - >10X improvement. Make the value proposition real and attractive.
Following visionary sales - the “early majority” – “the Pragmatists” – need to see a “Whole Product” (the core product plus any additional services/ support/ add-ons) from a provider they perceive as the market leader in the specific niche. This is why a company focuses ALL its resources on one niche – to be seen as the leader and attract the early majority.
Whole Product Concept – not just the core generic product but all the services/ support/ add-ons/ credibility needed for a pragmatist buyer to believe it is a market leading product. Pragmatists don’t want a test product or a new product – they want to have confidence in a Whole Product that they believe has longevity. Solve your target customer’s problem end to end.
Things such as:
Crossing the Chasm Approach:
Pragmatists need to be able to reference each other (calls/ trade magazines etc) – (I.E., a self-referencing market set)
Hence pragmatists like to buy from a salesperson from a previous relationship. Develop an alliance with an already accepted vendor. Pragmatists like to see price competition. They will pay a modest premium for top quality or service. Need patience to market to them…..Need to make yourself into the obvious supplier of choice. One of the keys is strong word of mouth reputation amongst buyers. Need 4-5 customers in one segment. Need to become the market leader in the niche.
How to pick the niche? Don’t focus on Target Customers – focus on Use Cases or characterise a market by what problems/benefits you are solving/giving.
1: Use case - characterisation:
2: Examine different use cases BEFORE the application of the new product:
3: Then with the new product:
Factors to measure each potential niche market (Scoring to make a decision):
Create the competition – for a pragmatist buyer to buy – they need to be able to compare the product to other products they know about – hard buy in a vacuum without comparison ability. Hence in the niche you choose there must be as:
Product positioning – how to make the product easy to buy (as opposed to trying to sell):
Typically you sell to one of these 5 groups:
So there you have it – follow the above and you are in business and will have VCs all over you …..simple right?! :)
By John Rowland, Managing Partner