Day 2 Morning - Internet Platform (Weiss and Carbone)

Lead to Win

Lead to WinInternet as go-to-market platform

May 2009

Michael Weiss and Peter Carbone

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Lead to Win

Objective

• Upon completion of this module, you will know:– how to enter networked markets– about ways to scale using the Internet

• And you will be able to:– determine when to use the Internet as part of your

product or your operations

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Lead to Win

Agenda

• Push vs pull marketing• Entering a networked market• Mapping your ecosystem• Internet-centric tools to scale

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Networked markets

• Locus of competition is shifting from the firm to the network: network position matters

• Entry strategies that focus on push marketing are less effective than those that focus on identifying market players and aligning them

• Need to envision the new market status quo and align the players across the market

• Mapping an ecosystem allows us to understand how firms access complementary resources

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Traditional push marketing

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Traditionally, companieshave pushed their products to players they know

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Traditional push with network

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Markets are hostile to innovations the more inter-connected players are

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From push to pull marketing

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Market players will only adopt a product when they believe others will do so

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From push to pull marketing

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Networked markets allow for quick diffusion of ideas, but also present barriers

Lead to Win

From push to pull marketing

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Breaking into a networked market requires care

Lead to Win

Entering a networked market

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Adobe PDF reader and creator

Reason back from endgame

Hard to change PDF documents: meets needs of creators to protect their content; offer reader for free, and creator as complement to (not substitute for) content creation products

Complement power players

Ally with Microsoft, AOL, and Google

Orchestrate incentives

Three types of players: developers, distributors, adopters (content creators, users)

Maintain flexibility

Separate reader from creatorOffer reader for free

Chakravorti (2004)

Lead to Win

Mapping your ecosystem

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Core

Node size: number of interactionsEdge width: number of interactions peredge (measure of strength) Weiss & Gangadharan (2009)

Lead to Win

Lessons from mashup ecosystem

• Positions of API providers are mutually reinforcing• Users will select APIs based on how many other

mashups use a given API, as well as the collective experience in combining the API with other APIs

• New API providers should seek out opportunities to complement existing APIs that are strongly positioned in the ecosystem (enter a niche around keystone)

• Complexity of mashup drives the development of mashup platforms that help search for APIs, enforce design rules in compositions, and certify APIs

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Go-to-market design options

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Option DetailsMarket Leverage network to reach market (eg sell

online, use download-and-try model)Distributor Eg Apple App store to reach customers (then

focus on getting into top 50 for visibility)Free Drive volume through a free service, monetize

some other business model (eg support) Long tail Offer large number of low volume items (Lulu

enables niche authors to sell their books)Embedded Reach market via a partner (eg Intuit software

ships with Windows)

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Sample tools

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Option DetailsAdmin oDesk is a service to find, hire, and pay

workforce: can scale with demandInfrastructure EC2 is Amazon’s cloud computing service:

can rent infrastructure as neededDevelopment Google Code provides canned hosting for

software development projectsDesign Eclipse as platform for product: can reuse

shared pool of building blocksCommunication enablement

Coral CEA provides integrated set of communications technology components

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Google Code

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Key messages

• Know your position in the ecosystem• Enter a networked market by reasoning back

from the endgame (new status quo) • Design GTM as you would a product – even more

important in a knowledge economy• There are many Internet-centric tools to

facilitate collaboration in GTM• Name of the game is to “herd the cats”• Room to innovate in GTM tools

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Lead to Win

Breakout activity (1 hour)

• Break into 3 teams and discuss – 30 min • Present back to class – 10 min each• Nominate a moderator, scribe and presenter• Pick one person's opportunity • Identify specific ways the opportunity does or

could take advantage of open source, mashups, open API’s and/or business ecosystems to reduce costs, reduce time to revenue, ...

• Discuss and prioritize your recommendations

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References

• Chakravorti, B. (2004), The new rules for bringing innovations to market, Harvard Business Review, 82(3), 58-67

• Weiss, M., & Gangadharan, G.R. (2009), Growth of the mashup ecosystem, submitted to R&D Management (posted on wiki)

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