Some Common Mistakes in Planning for Your Startup

In working with startups and early-stage companies — both as a consultant and as an employee — I've been fortunate to have been around some extremely bright, ambitious folks. But no amount of ambition — or even school smarts — can offset insufficient (or just plain bad) planning. In my experience, the top three obstacles to planning for a successful company or product launch are:

1. Not formalizing your planning process. This entails documenting both your planning and your conclusions, and — more importantly — being prepared to revisit your findings frequently, as new information becomes available. Lots of folks start with great intentions and flawed research. The ones who succeed are the ones who can accept the fact that their research (or conclusions) were flawed, and can take corrective steps.
2. Not doing a sufficiently deep dive into the competitive landscape. It amazes me how folks can invest so much ego into their company or product as to be blinded to the realities of the marketplace. Sure, you may think your product is the greatest thing since sliced bread, but if your target market doesn't agree, you've got a big problem. Know your competitors, and not just their weaknesses. You have to understand their strengths, because that is what has made them viable contenders. And who knows, maybe the market doesn't even care about their weaknesses! Be thorough and objective about your company or offering, as it relates the the needs of the market and your competitors!
3. Not having a sufficient understanding of your runway and your cashflows. You need to have sufficient working capital to build traction and to foster organic growth. You need to have realistic, conservative expectations on both your revenue and your ROI, and you need a solid backup plan (or several) to put into play when your initial strategy fails to deliver the anticipated results.
   

Don't put tons of effort into writing a business plan, only to throw it into a drawer and forget about it. Your business plan should be a flexible, iterative document, one that will enable your to address all foreseen (and unforeseen) contingencies. And it should be revisited on at least a monthly basis.

Create Demand and Value with the Soft Sell

Let's face it… most folks don't want to talk to a sales person. Unless they're looking to buy immediately, most people would rather walk around the showroom, kick the tires, and browse without fear of being pressured into buying something they don't need or want. And in the B2B marketplace, it's really not that different. In today's "do more with less" world, there's just not a lot of time to spare, and most of us really don't want to spend what little time we have being sold to. So that hard-sell approach that may have worked in boom times? It's probably not gonna work now… so as a marketer you need to come up with different approach.

The Hard Sell and the Soft Sell

Typical lead generation campaigns are all about the Hard Sell… "Respond Now for a Free Consultation" or "Act Now and Get Your First Month Free" are examples of a hard sell. A Soft Sell, on the other hand, is designed to provide high perceived value to your prospect, without too many strings attached. An example might be a complimentary White Paper that discusses typical pain points for your prospect base, along with an overview of how they can address them. Or, complimentary access to industry research, vendor reviews, or tips on how to increase productivity. And while you still need to capture contact information from those leads who elect to receive these items, the "threat" of a hard sell is greatly reduced in the minds of your targets.

The next time you are planning a lead generation campaign, put yourself in your prospects' shoes… think about how you would want to be approached, and craft your campaign and offer accordingly. And watch your response (and conversion) rates go up!

Email and Search Marketing Top List of Effective Marketing Channels

According to Datran Media’s "4th Annual Marketing & Media Survey," which surveyed more than 5,000 marketers online, 39.4% chose e-mail as their strongest marketing channel for 2009, followed by 23.6% who chose search marketing.

Those selections far outpaced all other channels, including display advertising (7.1%), direct mail (6.3%), and social media (4.7%).

When asked if social media marketing will generate quantifiable results for them this year, 50.4% said yes, while 49.6% either were unsure or said no. So, it seems that the jury is still out on social media...

That said, savvy marketers will continue to pay attention to social media, if only for raising brand awareness. With the highly-granular targeting capabilities provided by, for example, Facebook Ads, it is extremely easy to conduct tests of specific offers and determine their effectiveness in near real time. I'll be talking more about this in the coming weeks, so stay tuned!

Building Credibility With Analysts

It's not just "what" you say, but "how" you say it

Make no mistake: launching a new business or product — especially in this economy — can be brutal. One of the major challenges facing us as tech marketers is how to communicate the value of our product or service offering, not just to prospective clients, but also to individuals who can exert influence over a prospective buyer's decision as to which vendor will prove to be their "best bet." And while traditional Public Relations activities go a long way toward managing public perception, there is a limit to how effective you can be, especially when trying to communicate in a cluttered field of competitors, and hindered by limited resources. Which is where developing a relationship with select Industry Analysts can be particularly useful.

An industry analyst performs primary and secondary market research within a particular segment of an industry — for example, financial services or telecommunications — to determine market trends and business models and to evaluate technology providers and their respective technologies. Not only do analyst firms evaluate individual vendors and technologies, they also provide a reasonably objective perspective of the overall marketplace, key drivers, competing technologies and vendors, short- and long-term trends, and other equally valuable intelligence. Analyst firms such as Tower Group, Gartner, Forrester, IDC, and Yankee Group are retained by companies looking to make technology investments, and these analysts provide guidance with regard to which products to buy and which services to retain. These firms provide a combination of market research, competitive intelligence, and management consulting to their clients. From the perspective of the technology vendor, inclusion in an analyst firm's report or vendor ranking can provide a huge competitive advantage for even an established technology provider, and for a startup, it can mean the difference between success and failure.

As you can see, it's important to engage with analyst firms in order to get your message to them; they can't evaluate and report on a product about which they know nothing. But it's equally valuable to utilize their research services, in order to obtain a more comprehensive and more objective view of both the marketplace and competitive landscape. This can be extremely useful for your product development efforts, in understanding market requirements and pain points, as well as in honing your market messaging. Analyst firms can even advise on potential partners or customers, as well as providing insight into sales channel strategy. Many firms also produce national and regional events focusing on specific areas of interest, say, CRM or Business Intelligence. General research reports are typically purchased via subscription, or, in some cases, a la carte. For more intensive, one-on-one consulting and advisory services, most firms offer tiered consulting agreements, depending on the level of your need and length of engagement.

In this article, I want to focus primarily on how to go about developing relationships with analyst firms for the purpose of communicating your product message to them. But first, I want to state that it's vitally important that your CEO be fully on-board with your analyst relations initiative. An effective CEO is one who is completely aware of the needs of his customers, as well as knowing exactly what's going on in the marketplace. But more importantly, an effective CEO is both aware of and honest about their company's strengths and weaknesses. Analysts are always appreciative of a CEO who comes to the table with this kind of candor, and conversely, are keenly aware when a CEO is trying to bullshit them. Hopefully, your CEO is not one of that type!

How to Initiate the Relationship

If you're considering the establishment of an analyst relations function within your organization, here are a couple of things to consider: There are currently more than 700 (!) analyst firms across the globe, and their research and advisory staffs range from one person to several hundred.

Another important point is that these firms make their money from selling their research, either as reports or through custom consulting. In spite of a supposed "wall" between their research arm and their sales arm, it stands to reason that a "paying" client will get their attention more readily than a non-paying one. That said, I've had great success in obtaining good, positive coverage from the major firms without having been a paying client. It can be done, but it requires a methodical approach and some well-mannered persistance... and a little roll-up-your-sleeves "guerrilla marketing."

The first thing you need to do is to research which firms are covering verticals or technologies that relate to your product offering. That may seem obvious, but in situations where your product doesn't fit easily into an existing category, you may need to do some legwork to identify technologies that are similar, and see which firms are covering those technologies... if that's not working out, then you need to focus on analysts that are covering your target vertical(s). As you can imagine, Google will get a real workout! From this initial research, identify and rank in importance the firms that appear to be providing the most in-depth coverage of your technology or your target vertical. Start with the top 5 or 10, so you don't become overwhelmed.

Next, you'll need to identify which specific analysts within these firms are actually writing about both your target vertical and your technology type (or at least similar technologies). Again, Google will be your go-to source, and you should find plenty of information by typing-in a) the name of an analyst firm (i.e. Forrester) and b) the specific technology or topic, or a vertical (i.e. brokerage compliance). What you should find is a fair number of Press Releases containing "quotes" from specific analysts, excerpted from a research report or vendor ranking. Most analyst firms have an Analyst Directory on their website, including the analyst's name, research area of interest, and recently published work by that analyst. But you probably will not be able to access any of the actual research reports, without a subscription. To get around this, narrow-down your Google search, using the names of the specific analyst and the topic, you should be able to find some actual research reports, typically on the website of a firm that has been mentioned within the report. Many of these reports will be "restricted access," meaning that, in order to access them, you will most likely need to fill-out some information on that company's website (name, company, email address, phone, etc.) If it's a competitor, you may want to use a personal email account when completing this form. In any case, once you've been granted access to the report, you can begin to get a feel for the analyst's areas of coverage, etc. Most analysts also have public Blogs, where you can get a better sense of their interests and their perspectives, and possibly weigh-in on topics of interest to you or your company.

You will need to repeat this process for as many firms and as many analysts as you deem necessary. Your final product from this exercise should be a database of firms and analysts, with some basic information about both the firm and the respective analyst (including topics of reports and vendor rankings in which they've participated). Note that most analyst firms are very protective of their analysts, and do not list their contact info (phone, email) anywhere, insisting that you access them through a "Request Briefing" form on the firm's website. When you are ready to do so, you should, by all means, request a formal briefing through this mechanism, but you will also want to find a way to access the analyst through a "back channel." You may be able to decipher an analyst's email address by using one of the common email address protocols, such as firstinitiallastname@companyname.com, or firstname.lastname@companyname.com.

Time to Request a Briefing

When you're ready to actually request a briefing, do so through the "Request Briefing" form on the analyst firm's website. If you've done your homework, you already have a good idea as to which specific analysts cover your technology or vertical, and can request them by name. If you've read anything that the analyst has already written (and you should have, by now), you will have some sense of their perspective on the marketplace and its players, as well as their personal "hot buttons," and can hopefully find a way to address them in both your presentation "pitch" and in your actual presentation. Determine who from your organization will be on the call, and, as I suggested earlier, if you can get your CEO on the call, it signals to the analyst that your company takes the briefing process very seriously. Add analysts like that... a lot! You will typically need to provide a range of dates from which to choose, and the more flexible you can be, the greater the likelihood you'll get your briefing in a timely manner.

Prepare Your Presentation

You'll need to put together a Powerpoint presentation that provides an overview of both your company and your product. You typically have no more than 30 minutes to conduct a preliminary briefing, so it's important that your presentation is crisp and concise, with no more than 15-20 slides. Remember, this is NOT a sales pitch, so you really need to tailor your briefing around exactly what industry problem your product or solution solves, and exactly what differentiates you from other available products or solutions. Lastly, while this initial briefing is not typically focused on deep-level technology or architecture, most analysts are very comfortable discussing the inner workings of software applications, so it's a good idea to have a couple of "extra" slides that take a deep dive into the underlying architecture of your product, just in case the analyst is interested in reviewing it with you.

Write Your Script and Practice Your Delivery

You should prepare a written script for your entire presentation, and detail what you want to say for each slide. You (and whomever else will be presenting with you) should rehearse your presentation at least twice, and make sure that your entire presentation comes in well below the 30-minute mark. Be sure to leave at least 5-10 minutes for comments and questions from the analyst during your presentation, as well as for Q&A at the end of your presentation.

Preparing to Deliver Your Briefing

Most analyst briefings these days are conducted over the web, so if you do not already have web conferencing capabilities, you should arrange to get set-up with one of the various providers of this service. Webex, GoToMeeting, Microsoft Live Meeting, InterCall, and ConferencePlus are just a couple of the main contendors, and these services enable you to share Powerpoint presentations and other applications over the internet with individuals or groups. Some have integrated voice capabilities; for others, for others, it's an add-on. Once you've been set-up with web conferencing capabilities, be sure to do a "dry run" (or two) before you have to do your "live" briefing with an analyst. I've always found it useful to record my presentations (most of the web conferencing providers have a feature that enables you to record both what's on the screen as well as the voice), because it enables me to a) critique my performance and fine-tune it for the next briefing, and b) share the webcast with others in my organization, such as sales, client services, or new employees.

Deliver Your Briefing

When it's time to deliver your briefing, be ready and on the phone at least 5 minutes before your scheduled start time. Make sure that your web conferencing works, and your presentation can be seen. I will typically have a colleague in another office participate silently to ensure that the presentation software is working correctly, and who can alert me if there is a problem. I also take copious notes during a presentation, jotting down anything the analyst might have to say about either my product or about the market in general. Lastly, don't keep your analyst waiting.

Follow-Up

Immediately following your presentation, send a thank-you note out to the analyst, as well as to any of his (or her) colleagues who might have participated on the call. Be sure to reference any comments they might have made on the call (it lets them know you were paying attention), and if there were questions, either answer them within your thank-you note, or let them know when they can expect a formal response from you. Provide them with your contact info (including your mobile number) and encourage them to contact you if any subsequent questions arise.

Repeat

You need to remain on the analyst's "radar," and should plan on re-briefing each analyst at least once per year. If you are fortunate enough to be making significant enhancements to your technology, you may be able to brief them more frequently, perhaps twice per year. I typically shoot to do at least one or two briefings per month, throughout the year, and begin re-briefing them once I've gone through the entire cycle. Also, most analysts will want to keep apprised of your company's progress, and sending them periodic newsletters, notices of client wins, or other interesting news is usually welcomed. Just don't overdo it... communicating with them once per month is plenty. And, if they have a Blog, be sure to visit it periodically, and comment wherever it might appropriate.

At the end of the day, establishing credibility with the analyst community can have a huge payoff, especially for startups and emerging technology companies. When prospective buyers see your name come up in independent research, it raises their comfort level considerably, and gets you into doors that might not otherwise have ever opened for you!

LIST OF ANALYST FIRMS

Some of the better-known analyst firms utilizing traditional business models include:

• AMR Research

• Basex

• Burton Group

• Canalys

• Current Analysis

• Dittberner Associates

• EGI

• Evaluator Group

• Forrester Research

• Frost & Sullivan

• Gartner

• IBIS World

• IDC

• Informa Telecoms & Media

• Mercator Advisory Group

• Ovum Ltd

• SNL Kagan

• Springboard Research

• Strategy Analytics

• Verdict Research

• Yankee Group

Several firms are developing new analyst business models based on contemporary technologies, social media, open source licensing concepts, loosely-federated analysts, and/or a more radical and visible emphasis on offshoring. Notable examples of these types of firms include:

• ConneKted Minds

• Experton

• Experture

• RedMonk

• Macehiter Ward-Dutton

• Quocirca

• ResearchFarm

• Freeform Dynamics

• Wikibon

Got a tip you'd like to share, or maybe a question about any of the ideas presented here? Feel free to drop me a line at david.orban@oydesign.com.

"Why are there all those words on your website?

A prospective client of mine who is looking at a possible website overhaul posed this question to me today: "I noticed that most of the web sites you build are very busy... lots of columns and a lot of words/sentences..."

His current site is, shall we say, "minimalist," with very limited information about either his company or the service they provide. He told me that he had deliberately made a choice to present it in that way.

I thought about his question, and what follows is my reply:

If you’re selling a product or a service to the business community, you know that you’re in competition with many, many other businesses. One of the many challenges you have as a businessman is how to communicate the business value of your offering to a prospective customer, as well as how “credible” are you as a provider of this product or service.

At its most basic level, a website should help you to overcome these challenges, by providing an easy-to-understand summary of exactly what it is that you are offering. With regard to building “credibility,” you can do so on the web by a) providing the credentials and experience of your key players; b) showing awareness of the business challenges of your prospective buyers; and c) demonstrating knowledge of your industry and any coming changes, regulatory issues, or general evolution.

In retail e-commerce, where you’re selling commodity items like shoes or power tools, prospective buyers presume that a name-brand product available through outlet “A” will be the same as the same product through outlet “B.” In these situations, price is usually the determining factor, followed by availability and level of service – i.e., how quickly you can get it. Consumers buying shoes from an “established” player like a Zappos or Shoes.com know that either retailer is “trustworthy,” and will typically base their purchase decision on availability of a style or size, or maybe shipping costs.

However, in the world of B2B, it’s a little different. First the prospective purchaser needs to have a clear picture of your product or service offering, and, presuming that it’s NOT a commodity-type of offering, they’ll need to understand the business value that you bring to the table. Next, they’ll want to understand what about your firm differentiates you from other firms offering similar services, as well as determining how “credible” you are. What about your experience enables you to ensure success for them? They will want to know how likely it is that you are able to actually deliver on your product or service, as well as looking to see examples of documented success in providing your services to other companies.

That's where your web site comes in. Prospective customers will peruse your site, and based on what they see there, will determine whether or not they feel comfortable doing business with you. The aesthetic quality and sophistication of your website are certainly important, as they say a lot about your company. And, more importantly, by providing a compelling “story” about your company and your product or service, your prospects will be far more likely to seriously consider doing business with you.

I presume that prospective clients spend time on my website, making their own determination about my background, experience, and qualifications. Rest assured that others will spend time on your site, for the same reasons. They may do it before they talk with you, and they will most certainly do so after they have spoken with you. But in either case, it will influence their decision to move forward (or to NOT move forward) with you.

Hope this clarifies things for any other folks out there with the same type of question.

Writing for Your Website

Content is STILL King

For better or for worse, the words that we use set a tone, and form, in others, a distinct impression of our personality. Of course, when we communicate "in person," we augment our words with a continuous, real-time feedback loop in the form of facial expressions, body language, and gestures, all of which go a long way toward influencing how the listener responds to the messages we're trying to convey. These factors all contribute to whether or not our words are credible, and whether or not the listener "trusts" us as a messenger.

In the online world, we lose access to the non-verbal cues that are so important in our one-to-one communication. As a result, our audience evaluates our online messages very differently, and — without the ongoing reinforcement of our body language and expressiveness — it is MUCH more difficult to evoke trust and, in the case of say, a sales message, to move toward a "close."

Content is More Important Than Ever

Writing for the web requires a slightly different approach than, say, scripting what you'd say in person, or even in a telephone conversation, where some limited real-time feedback is still taking place. To compound things, according to web usability guru Jakob Nielsen, during an average site visit, users read only 28% of the words on the typical web page. So you really need to get to the point quickly... and convincingly. Nielsen says, for example, that the introductory paragraph(s) found at the top of many Web pages — what he refers to as "blah-blah text" — is typically skipped-over by readers, who tend to go directly to more action-oriented content, such as product features, bulleted lists, or hypertext links. So, Nielsen recommends that writers "cut to the chase" with their web content. Don't waste word count on generic, feel-good material. Hey... it's not going to make your prospects or customers "feel good" anyway, so why bother? Your site visitors only want to learn whether or not your product or service will help to solve their problems — and as quickly as possible — so they can leave your site and move on to other business.

When prospects — or clients — visit your website, they don't have the same opportunity to analyze what you're saying against a continual flow of non-verbal cues. Accordingly, it's really up to your choice of words to help them decide whether or not to trust what you're saying, and ultimately, your business and brand. The words you choose, and the way in which you present them, create an impression in the mind of the reader, so be respectful of your audience, and when writing web copy, try to put yourself in their place. Limit hyperbole— words like amazing or unbelievable — and stick to a more basic style of writing. Also, you should write in terms that reflect your audience's language, as well. If your audience typically calls something a "widget," but you refer to it as a "doodad," you're gonna have a communication problem.

Making Your Website Headlines Work for You

Writing good headlines for your website has nothing to do with writing great literature, or even articles in newspapers or magazines. Great website headlines are worth their weight in gold, but knowing how to create them is not particularly intuitive, nor is it something that you can learn by emulating what you read in newspapers and magazines. In traditional print media, the reader has clearly decided to engage and browse through the publication, while on the web, there are an unlimited number of distractions, all just a mouse click away. Folks who are browsing a website typically don't wander through the site looking for articles of interest, in the same way that they might with a magazine or newspaper. They rely on search engines to search and discover content, so once someone manages to find your site, you have an extremely limited window of opportunity in which to engage them and maintain their attention. For maximum effectiveness, you'll want to:

• Ensure that your content is easily found via search engines
• Increase your visibility and exposure on the topics about which you write
• Attract better-targeted visitors who have real interest in what you have to say

While this article is not focused on Search Engine Optimization (SEO), there are many aspects of your writing style that can help to bolster your ranking in search engines. Headlines can be particularly important. To write effective headlines for your website, you'll want to:

1. Keep your title short — Three to six words is the ideal length, with ten words probably the limit. Search engines such as Google give "high relevance" to only the first set of words you use in the title, and they will typically display only around 8 to 10 words in their results pages (Google and MSN; Yahoo displays up to 16 words). Also, Google looks at the opening keywords of your title and checks to see whether or not they are reinforced in your own content before deciding where to place your page inside search engine result pages.
2. Don't try to to be "clever," by using irony, puns, plays on words, or any other journalistic approach. Your title should really be more of a "label" for your article, making it easy to find for folks who are using search engines to find articles (such as yours) that are actually of interest to them. Remember, too, that on the web, headlines are often displayed out of context. Make it easy for visitors to find yourcontent!
3. Your headlines should be able to stand on their own — If somebody was to read your title without the associated article, would they have a clue about the content? Your headline needs to be self-sufficient, and make sense when the rest of the content is not readily available.
4. Use the same terminology that your visitors would use — Put yourself in the shoes of your prospects, and think about what search terms they would use to search for your product or service... or, better still, your competitor's product. Use this knowledge to craft headlines that will be most meaningful to your audience.

Website Body Copy: Short and Sweet

First, make your "word count" for online viewing about half the word count you might use when writing for print collaterals. Many users find it tiring to read too much text on screens, and they also tend to read more slowly on computer screens than they do on paper. Use simple sentence structures. On the web, convoluted writing and complex words are even harder to understand than they are in print. Remember that web users are impatient and critical. They haven't gone to your site because you are a wonderful person, but because they have something that they need to accomplish. Write in a simple, non-hyperbolic style that allows them to quickly find the information they need.

Also, recognize that visitors — especially those arriving through a search engine — can enter your site at virtually any page, and they can easily move back-and-forth between pages, so make sure that each page is independent of the others, and covers its respective topic without assumptions about the previous page (or the home page, for that matter) having actually been seen by the visitor. It's also a good idea to provide links to background info or explanations to explain names or concepts that might not be clear to the casual reader.

Limit the amount of scrolling that your visitors need to do, and put your most important information at the top, so that it can be seen without any scrolling at all. If you do feel the need to have lengthy pages, make sure that you provide a "Back to Top" anchor link at both the bottom of the page. Also, the Web is a fluid medium, so update your content frequently. Statistics, numbers, and examples all need to be recent, or your company's credibility will suffer. For example, before a conference, your page about the event might have a link to a general info page or even a registration form; afterward, you might have a recap of the event, or provide links to slides or transcripts of a presentation that was given at the conference.

Lastly, most web visitors scan pages; they do not read word-by-word, so if you've got a lot of uninterrupted text, think of ways to make your document easy on the eyes. For example, to make important words or ideas stand out, use highlighting, as it will aid in their visual scanning of the page.

Fresh Eyes Can Improve Your Web Content

Keep your writing crisp and simple. Each paragraph should contain just one main idea; use a second paragraph for a second idea, since readers will often skip over any ancillary points as they scan over the paragraph. When you finally think you have a good finished product, be sure to have others proof it... not just for typos and grammatical errors, but also to see if it "makes sense" to a casual reader. Readers who don't really know much about your business can often make for great editors... their lack of industry or product knowledge enables them to spot problems that might not be obvious to you, so enlist your spouses, friends or relatives. The end result will be better for the effort!

Carving Out a Reputation

The Crucial Role of Branding and Positioning for Tech Companies

Starting a B2B technology company is a tough business. Many companies try, but few succeed over the long haul. But not all of the companies that fail do so because of bad technology. Some that fail even have superior technology... but they didn't have a good handle on the marketing process. The B2B technology market is a demanding one, with buyers who are knowledgable, pressed for time, and, ultimately fickle. They have no interest in wading through products that are poorly positioned, with lousy collaterals, or confusing pricing models. Which is why a good working knowledge of Product Marketing is so vitally important!

There are typically two things that stand between a technology product and its intended market: The product itself; and a successful marketing plan. Products that don't adequately address market needs, or that perform poorly, already have two strikes against them. But even a killer product, without a sound, viable marketing plan, can quickly go down in flames. Now, if you've got a product that just isn't up to snuff, that's really a Product Management issue, beyond the scope of this article (we'll cover it in the next issue). But, having successfully marketed tech products that were, shall we say, not quite ready for prime time, I'd like to talk about positioning strategies that have proven effective.

First, I'd like to talk about the distinction between Product Management and Product Marketing... In an ideal world, these disciplines work closely together but are distinctively separate, because their roles are somewhat different. At the most basic level, Product Managers "listen to" the market — learning what the market needs and building a product that meets those needs; while Product Marketers "talk to" the market — telling them what your product is and how it can help them. Not a huge distinction, but an important one. Unfortunately, in this day and age, more and more companies are combining these roles into one, especially in startups and early-stage companies. Of course, in these types of situations, you'd better have a pretty good handle on the fundamentals of both disciplines; However, for this series, I'm focusing primarily on the high-level fundamentals of Product Marketing.

Product Marketing Basics

There are four basic components that are essential to product marketing:

• Positioning — Providing a clear description to the marketplace of your product's purpose and functionality, as a stand-alone entity, as well as in relation to competing products
• Launch — Announcing and releasing the product to the marketplace
• Distribution — Delivering the product to buyers
• Sustaining — Maintaining sales and market share through marketing and promotional activities Positioning, Naming, and Pricing

This month, we'll focus primarily on Positioning. Positioning is something that happens in the minds of the target market. It's the perception the market has of a particular company, product or service in relation to their perceptions of competitors in the same category. For example, you know the difference between, say, Microsoft and Apple, because of the considerabl work that each company has done on its positioning. Other examples in the automotive industry might be Volvo (safety); Porsche (engineering); and Subaru (inexpensive dependability). In the emerging technology space, though, it's scary how many tech products have gone to market without a clear understanding of the product's position in the marketplace. Until you've properly defined your product, your target market, and the all-important "why" someone would want to buy it, you can't even begin to market it. Positioning is the foundation for virtually all of your marketing activities. And it has to be clear and logical, to both your marketplace, and, equally importantly, to your company. More on that later.

There are many ways to position your product, but here's a good example of a product positioning statement "format," of the type that was used by Geoffrey Moore, author of Crossing the Chasm, from his days at the legendary Silicon Valley tech marketing consultancy Regis McKenna. Moore wrote that "Positioning is the single largest influence on the buying decision." An example of the type of format he used looks like this:

Product Position Statement

For (list the targeted end-user)

Who wants or needs (list a compelling reason for them to purchase),

The (your product or service) is a (list the product category)

That provides (list your key benefits),

Unlike the (name of competing product) offered by (list your main competitor),

Which does not (list the key points of differentiation)

So, the logical extension might look something like this:

For Retailers who need real-time point-of-sale transaction security monitoring, eVanta'sTransView is an enterprise Point of Sale transaction monitoring solution that provides live monitoring and real-time flagging of suspicious transactions, unlike currently available solution that only do so in batch processes.

Here's a slightly different approach — Imagine that you're promoting a service such as tax preparation that targets the self-employed. You might work through a thought process something like this

This service would be valuable because:
The provider specializes in tax preparation for the self-employed.

Customers would benefit because:

• Expertise in this area would provide the maximum potential for tax savings.
• Lower fee structure enabled because of a narrower band of expertise.
• Quicker response (and quicker refunds) because expertise enables returns to be completed in a more timely manner.

This service would be useful for:

• Business consultants
• Freelance writers
• Photographers
• Artists
• Musicians

The resulting short and long positioning statements might read:

Short

Bob Eckert, CPA, is a tax preparation service that helps self-employed individuals such as business consultants, freelance writers, musicians and artists file their tax forms quickly and correctly, enabling them to reduce their tax liability.

Long

Bob Eckert, CPA, meets the needs of self-employed people such as business consultants, freelance writers, musicians and artists. Customers will benefit from using Bob Eckert, CPA, because Mr. Eckert is an expert in this area and is knowledgable about self-employment tax law, enabling the maximum about of tax savings. Clients also benefit from a lower fee structure and quicker response, because Mr. Eckert's expertise enables him to complete these types of returns more quickly than a "generalist" Tax Firm.

The Essentials

As you see, there are a number of different approaches that you can take. But generally, the product positioning process involves:

• Defining the market in which the product or brand will compete (who are the relevant buyers)
• Identifying the attributes that define the product space
• Collecting information from a sample of customers about their perceptions of each currently-available competitive product and their relevant attributes

Specifically, you need to answer a couple of questions:

• Who is your target market?
• What challenges do they face that your product can help them solve?
• What are the major features and benefits of your product, and how to they align with the expectations of your target audience?
• What other products are available, against which your product must compete?
• How does your product stand up against these competing products?
• What class of product are you selling (low-end, mid-level, high-end)?

Answer these questions truthfully and objectively, and you're well on your way to successfully bringing your product to market. You'll be able to:

• Clearly define your target audience
• Clearly define your product and product category
• Build a product that meets the needs of your target audience (althought this encroaches into Product Management territory)
• Determine what kind of distribution system (internal or external) you will require
• Price your product competitively (and realistically)

The Competitive Matrix

Another tool that is often used in developing positioning is a matrix (example at right), on which you would plot-out the currently-available competing products within the marketplace, along with relevant attributes, from low-to high (i.e. price, features, innovation, etc.)

A competitive matrix helps you determine your company's competitive advantage (or disadvantage, for that matter). It provides an easy-to-read portrait of your competitive landscape and your position in the marketplace. This can aid in visualizing where you are versus your competitors, and can help you to better understand your strengths and weaknesses. As you can imagine, it is critical that you are coldlyobjective about where you actually fit in the marketplace. Attempting to fudge on this area will only mean that the decisions you make based on this delusion will be flawed... as will your results. An objective view of your "real" position within the marketplace can help you determine which steps you need to take in order to a) be competitive, and b) understand what you would need to do to, in order to be where you'd want to be on the matrix.

The Value of Your Brand

Branding and positioning are key to the success of your product, so it's crucial that your efforts convey a clear and credible promise of value for your intended audience. It's important to understand what a brand is. It's NOT a product, yet that seems to be a difficult concept for some marketers to understand. Sure, you can buy a company. And you can buy its brands. But you can NOT sell these brands to the customer. All you can ever sell are products and services. That's because the brand is just a symbol, an intangible entity that is the result of your company's hard work: PR, media and analyst relations; advertising; collaterals; testimonials; and — of course — a good product. The real goal of investing in your brand is to be able to charge a premium for your product, or to increase your market share. Or preferably both.

Communicating Your Value

In order to gain acceptance for your product or service, you'll need to create compelling value propositions that address not only the user benefits of your product, but also the benefits to decision-makers and key influencers, who may not be the same as the end-user. In B2B plays, your decision-makers and influencers are — more often than not — completely different from one another, and may even be in conflict with each other. For example, say you've developed an application that helps monitor financial transactions at a brokerage, identifying and flagging unusual transactions that might be inappropriate or even fraudulent. Your end-user might be a mid-level operations employee, but they aren't the actual decision maker. While they might recommend products or services, the final decision ultimately rests with a business manager or P&L owner. Similarly, technology products will usually need to be vetted by a technology gatekeeper, say, the CTO or the CIO. Of course, their interest might be in maintaining tight control over technology spending (hoarding it all for internal projects), and they might also be wary of technology (or technology purchases) that did not originate with them. And if there are consultants involved, that can add yet another layer of gatekeeper who must also be "managed."

In this type of scenario, you'll need to look at each participant in the decision-making process, identify their respective hot-buttons, and develop specific value propositions for each of them. Each participant in the decision process must be made to feel that your product or service provides them with real, distinct value, value that they can't get elsewhere. If you already have customers, you need to ask them "What value do users get from this product or service?" You need to determine how they are better-off, as a result of using your product or service. And, what characteristics differentiate your product or service from others that are already available in the marketplace? If you don't yet have customers, you need to be talking to your prospects, and determining what they feel are the most important aspects of your offering (hopefully, you will have already done this before you began your product development efforts). Starting with the answers to these questions, you can begin to create the first draft of your positioning statement. After you've done so, test it out on people who don't really know what it is that you do or sell, and listen for their responses. Once you've piqued their interest sufficiently so that they want to know "more," you'll know you're on the right track!

Employee Alignment

One last point that is too often neglected: It is critical that your employees — at all levels — are brought into the branding and positioning process at the earliest stage. They already have a perception — for better or for worse — of your company and its products. They also may be on the "front lines," interfacing directly with your prospects and clients, and may have valuable insight on how you are already perceived within the marketplace. In order for your brand positioning to be effective, it has to reach every area of your company, and be a part of every customer interaction. In order to have a strong brand, even your receptionist must know the central values, and these values should guide their day-to-day behavior. With proper employee alignment, each and every person in your company will deliver a consistent brand experience to each and every prospect or customer with whom they come in contact. And as a result, your prospects and customers — and the marketplace — will begin to regularly associate your products and your company with the values you've established!

Well Worth the Effort

Virtually every strategic marketing activity — from naming, to collateral development, to packaging, to PR, Media, and Analyst Relations — depends on having a clear and concise brand position. A well-conceived — andconsistent — brand and positioning strategy creates a strong brand equity, which is the added value brought to your company's products or services that enables you to charge more than what can be charged by similar, unbranded (or poorly-branded) products. An obvious example of this would be Coke versus a generic or store-brand cola. Because Coca-Cola has built such a powerful brand equity, it can charge more for its product — which is why customers willingly search-out Coke, and will pay a premium price. Position your company and its products correctly, and you will quickly build awareness and enhance profitability!

Hopefully, this article has provided you with some useful information that can help you in properly positioning your product or service.

Comments or questions? Drop me a line at david.orban@oydesign.com.