Lecture Notes: Marketing and Sales of Technology and ...adelaide.s3.amazonaws.com/TC7060/MTILectureNotes...Lecture Notes: Marketing and Sales of Technology and Innovation – Week

Lecture Notes: Marketing and Sales of Technology and Innovation – Week 6

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INITIAL CUSTOMER CREATION Armed with our learnings from customer Validation you can now get ready to approach your initial customers. These initial customers are most likely to be ‘technology/innovation enthusiasts’, or ‘visionaries’, aka ‘early adopters’. You will recall they are the types of customers shown to the left of the chasm in the

technology maturity bell curve that we discussed earlier. While you have had very interesting conversations with these early adopters as part of customer discovery and validation, they have only been conversations. In order to convert these ‘potential’ customers into ‘paying’ customers you will need to show them the value and benefit they will derive from your product offering. It must be enough value to cause them to want to pay you!

Confirming Value One of the key things about the initial customer creation phase is confirmation that you really do bring value in the eyes of the customer. This involves understanding how they measure value and showing that you indeed bring such value them. Between the customer and yourself you will need to agree a way of converting value to the customer into dollars that they will pay you.

By this time you should have your own ideas on pricing for your product offering. However it will pay you to reconfirm the underlying assumptions on which you based your pricing ideas, as it is possible you may discover additional value aspects that you bring to the customer. You will also want to discover one or two aspects that the customer regards as having value to themselves. Look for those that if you provide them, do not involve you in any extra costs or minimal costs. This enables you to be creative about your initial deals with these early adopter customers.

TECHCOMM5001 Marketing Technology & Innovation

Copyright 2011 University of Adelaide. Unauthorized redistribution prohibited.

ONLINE LECTURE

Week 6

Initial customer creation


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Support, above all! While early adopter customers are more adventurous, they do want value for money. You must provide your initial customers with all the support they need to turn them into testimonials and case studies for you. This means that giving them ‘extra support’ promises is quite likely not going to cost you any more than what you would have to provide in any case. If things go

well and they don't use the extra support offered, you have not had to give anything away. So a creative deal may be to use the pricing that you have set, but providing extra warranty support as part of the deal. This can provide the customer with extra comfort, which equates to extra value to the customer. At the same time you have avoided any monetary concessions (aka as 'discounts'). In addition, you can reference a customer that paid you according to the value they saw in your offering. This builds a perception of value in your offering. There may be a number of other possible ways to create ‘extras’ that are of value to your customer while not involving you in much if any additional costs.

Measure Results You must find ways to measure value and results that are acceptable to your initial set of customers as well as, potentially, future customers. You can incorporate the measures and value and benefit results into tables, which are known as 'ready reckoners'. There is an example of a 'ready reckoner' in the course materials document, 'Examples of discovery, validation, and customer creation'.

It’s essential that you understand the value you bring to the customer, and can talk about it confidently with the customer. This enables you to use such a 'ready reckoner' to quickly identify the size of the benefit that your solution may offer to the customer. You could start with a ‘draft’ ready reckoner on paper. Once you have fully confirmed the measures and value parameters, build it into a spreadsheet or smart phone app. format. That enables you to enter the variables that apply to the customer to get a benefit result calculation that matches the customer’s individual situation. The elements of value (measurable savings, benefits, etc.) of your product offering can be grouped under headings that make sense to the customer. Note it’s important that other people in the customer's organisation involved in the decision about your product would also need to readily understand them. These elements can be incorporated into a pro-forma summary document showing the sum total of all the benefits as compared with the cost of implementation. This should lead to a justification where the financial benefits to the customer vs. the customer’s ‘investment’ are


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expressed in terms of ‘return on investment’ (ROI) or a 'payback' period usually expressed in months. This leads to you being able to show the customer how to justify your offering and to calculate the ‘cost of delay’. An example of such a justification is included in the document 'Examples of discovery, validation, and customer creation'.

Testimonials and Case Studies What a customer says about your product offering, the value delivered, and the support provided by you is much more credible than whatever you can say. Hence it is very important to obtain customer testimonials as well as case studies. Testimonials are developed by asking a customer for feedback on

some key questions: 1. What specifically is the problem that your solution solves? 2. What specific benefits your solution provides? 3. Why the customer chose your solution? 4. Who else the customer would recommend your solution to? The feedback you obtain to these questions can be consolidated into a short statement in the nature of a testimonial. This is then presented to the customer for sign off. It is used to add credibility to the messages on your website and other company collateral. A customer Case Study involves a more extensive exercise with a focus on the customer's situation and unmet needs before adopting your solution and the impact of that on their business. The impact may be strategic like not winning new customers or losing existing customers, or it may be operational such as incurring excess costs or expense. The results, in the form of tangible benefits are summarised in the 'after' situation. Preparing a case study involves a journalistic interview approach, developing and writing the case study, and obtaining customer permission to publish. Wherever possible case study materials should include photos of customer premises, customer products (e.g. bottle of Coke), trucks decorated in the customer's livery, contract signings, and opening of new facilities using your solution. You need to carry a smartphone / camera with you at all times! Case studies are ideal content for publications that are circulated in your customer's industry. Editors of such publications look out for customer needs and benefits stories. You need to take a proactive approach to the editors and meet with them to introduce your 'business value and solution' customer stories. You back up that conversation with a very modest advertising commitment. Think of ‘publications’ as including industry web portals, and any other media that reaches your target customers on a regular basis.


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This kind of activity builds market awareness, buzz, and positive perception about your company and its offering. You avoid the expense of costly and often less than persuasive advertising. It becomes part of your 'pull' marketing approach.

Message Trials Back in the 'customer discovery phase' we talked about ‘keywords’ as being the special words that your target customers use about their business issues, and the solutions they require for their needs. Right through customer discovery and validation, as well as this initial customer creation phase, it remains critical to identify and reconfirm those keywords.

These keywords are part of the ‘language’ of the customer's business. Your marketing and sales messages must use these keywords. Make sure that your use and understanding of these keywords is as complete and realistic as possible by incorporating them into you marketing and sales messages and stories. And keep testing their efficacy by using these keywords words in all conversations with customers. Look for any feedback that these are, or are not the right words to use. As you learn more about the words and their application and context, so you keep refining the list of keywords and their use. This applies to all the messages you put out. Your website, your brochures, your 'ready reckoners', your proposals, and your testimonials and case studies. Over time, you come to be seen as knowledgeable specialists in the industry that is identified with your customers business. If you can do this right, in time you will be seen as the preferred specialists. That is the position to strive for! Being fully identified with a solution approach, value delivered, credibility and trust!

Spreading the word Word of mouth by others about your product can help to create market buzz. It is a very persuasive way to build new leads and increase your conversion rates. If such a word of mouth and buzz can go viral, your business may benefit substantially. In addition, you can apply 'permission marketing' techniques as written up about by Seth Godin. In essence,


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permission marketing is based on providing target customers with information that they place value on, and which they permit you to keep providing them with. This is embodied in the concept of people subscribing to mailing lists that bring them information they put value on. Note there needs to be a facility to unsubscribe should their perception of the value to them of your information change. The permission marketing approach enables you to bring pictures and stories to your target audience, and over time can make you a 'household' type name within their business and industry circles. This can further bolster the customer and market's perception of you as a preferred specialist. In many industries there are people who are influencers or who work as industry analysts. Industry influencers may include people who run their industry's professional or trade association and who may be seen as 'thought leaders' by others in their industry. Some industry analysts specialise focusing on new developments and applications of technology in their chosen industry. Others focus on selling their industry research and knowledge to the volume and mature sections of the markets (right side of the bell curve). You want to target 'thought leaders' amongst the analysts. If you can target and reach such industry analysts, you may be able to persuade them (for a modest sum of money) to formally review your product in the light of providing new and important business value and results. Such a review can complement your testimonials and case studies, and provide yet another credible source of positive information about your offering and its benefits and results.

Looking bigger than you are It is to your advantage to look bigger than you are. People attribute credibility to the right kind of appearance. Your website is your overall story to the world at large and must appear credible. Business is as much about people as it is about products and services. Your website must tell the story about your key people as well as

your products and their application, the needs they address, and their business value. You need to lead with value and benefit stories. These must be your central themes. Everything needs to relate to the customer and how you meet their needs and provide business value. This makes it easier and more likely for website visitors to choose to make the next steps to learn more about your solution offering. Every story and article must be of potential interest to customers, and the other parties they talk to and rely upon. Every story and article must include a 'call to action', i.e. a point such as ‘call me’ or ‘show me more…’, where the customer has to identify themselves to make a follow up request to you. This becomes the basis of ongoing 'permission' type marketing.


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Listen, record, analyse! As ever, the key is to keep listening to customers, and to record what they say so that you can review and analyse this feedback on a regular basis. Of course there is no point in this unless you also modify your approach and messages to incorporate these learnings on a timely basis.

Wrap up: Key aspects of initial customer creation

The key learnings for this week may be summarised as follows: 1. Initial customer creation is where the start-up comes to the situation where the rubber

meets the road. Now is the time to start applying the learnings out of the customer discovery and validation phases.

2. First off is the confirmation of business value. The measurement of such value, its

conversion into dollars, and payback, and testing the customer's ability and willingness to pay. Also exploring pricing and, where required, doing special deals.

3. Recognising the importance of support, and that extended support can be an aspect of

doing a deal with a customer that represents a benefit or value to the customer, and may involve little or no extra cost to you.

4. Need to measure results and find ways to illustrate such results in an easy to ‘get it’ way,

e.g. a ready reckoner. Developing a pro forma financial justification approach that emphasises the cost of delay on the part of the customer.

5. Developing testimonials and case studies. Being forever ready to take pictures and gather

evidence. Obtaining customer sign off. Using testimonials and case studies widely and often.

6. Confirming and refining keywords used by the customer and in the customers industry.

Continuing to use and refine the list of keywords.


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7. Using customer word-of-mouth wherever possible to create credibility and buzz. Reaching customer industry influencers and industry analysts. Using these parties to help spread the word.

8. Looking bigger then you are. Working on the credibility of your website. Addressing both

your company and product in conveying a complete picture. Leading with benefits and value expressed in the customer's language. Ensuring everything that creates customer interest has a 'call to action' to encourage follow through.

9. Forever listening, recording, analyzing, and applying the learnings on a timely basis.

Documents

Lecture Notes: Marketing and Sales of Technology and ...adelaide.s3.amazonaws.com/TC7060/MTILectureNotes...Lecture Notes: Marketing and Sales of Technology and Innovation – Week