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Great articles roundup: Lean methodologies, story-centred design, real-time marketing, value proposition, pitching editors

By Daylin Mantyka

As a regular feature, we provide our readers with a roundup of some of the best articles we have read in the past week. On the podium this week are Ash Maurya: Practice Trumps Theory, GigaOm, Fast Company, Marketing Sherpa Blog and Social Media Explorer.

Your business model is a system and why you should care

Ash Maurya talks about the roots of lean development and why understanding where the concept came from is important for successfully finding that sweet spot in product-market fit.

Why good storytelling helps you design great products

One of the biggest mistakes when designing a product is focusing on great looks before thinking about great functionality. Braden Kowitz, who leads the Google Ventures Design School, talks about why using a story-centred design is crucial to getting the product right.

Oreo’s ‘Dunk in the Dark’ strategy and the future of real-time marketing

By now anyone who’s anyone has heard and analyzed Oreo’s brilliant Superbowl Tweet. This witty play not only sparked a dialogue on the power of real-time marketing, but also a paradigm shift in terms of how teams create content. Gian LaVecchia says that we’ve evolved from the concept of “brand as publisher” to “brand as newsroom,” which supports content development that is incredibly agile and helps marketers to reach and connect with audiences at scale.

Value Proposition: 3 techniques for standing out in a highly competitive market

John Tackett proposes three techniques in refining your value proposition that can be used to differentiate products or services in highly competitive environments. Thinking about why customers choose you over the competition is one method of standing out.

6 questions for blog editors

Entrepreneurs are constantly thinking about how to get their startup in the public eye. One method is to pitch journalists and editors who write for popular online publications. Editors can sometimes be the gatekeepers to a startup’s breakthrough, so why not learn what makes them tick? Andy Crestodina asks six questions to six prominent online editors and tells all.

Technorati Tags: Andy Crestodina, Ash Maurya, Practice Trumps Theory, Braden Kowitz, content marketing, design, Fast Company, Gian LaVecchia, GigaOm, John Tackett, Lean methodologies, Marketing Sherpa Blog, pitch, pitching, pitching editors, product development, product differentiation, Product-Market Fit, real-time marketing, Social Media Explorer, Startups, story-centred design, value proposition

What an entrepreneur can learn from a literary conference: Part II

By Leo Valiquette

I’ve blogged before about my ambitions to become a fabulously successful novelist and my annual April trek to Toronto to attend the Ad Astra literary conference. Having just returned from the 2013 edition, here are my latest observations that apply as much to entrepreneurs as they do to authors.

First let me reiterate that both are in the business of:

Developing a commercially viable product for the marketplace.
Refining that product through a beta phase (beta customers versus beta readers) to ensure it will pass muster with potential business partners, investors and retail distributors (agents, publishers, booksellers).
Building an identifiable brand among consumers through various channels that include social media, trade shows and industry events (among writers, it’s called “building your author platform”).
Engaging with the marketplace to build customer loyalty, grow sales and ensure that your follow-on products (subsequent books) continue to meet the expectations the market has for your brand.

And there are of course three crucial disciplines that will make or break either: marketing, marketing and marketing.

So here are the lessons I learned this time around in the various conference panels and hallway chats I attended over the course of the weekend:

Lesson 1: Don’t do business with anyone who won’t lift their skirts as high as you

Publishing is an industry rife with charlatans, fakes and con artists. For the first-time author, this first manifests when trying to find an agent. An agent is a business partner. It is intended to be a mutually beneficial relationship built on trust. They will know someone, you will know someone and together you will make things happen. They will look out for your interests to ensure contracts are above board and the royalties are flowing as they should.

The reputable agent does not soak you for “reading fees” or any other upfront expenses. They get paid when you get paid, with an industry-standard percentage. They should also have more contacts than you do. And any agent who is courting you should have absolutely no reluctance to refer you to other authors they represent so that you can talk to them, privately, about what it is like to work with this agent.

It’s all about due diligence and a fair and equitable sharing of risk: the foundation for any great business relationship. The tech entrepreneur should demand the same level of transparency and accountability from any potential partner.

Lesson 2: The fine print matters

This one should be self-evident. When it comes to the legal stuff, make sure you have qualified expertise in your corner. For an author, this may mean engaging with someone in addition to the agent. For the entrepreneur, it means don’t set yourself up for a disaster down the road by trying to cut corners to save money.

Lesson 3: Nobody wants to work with an ass

In a past post we spoke with Andrew Fisher, executive VP at Wesley Clover, about what he looks for in the entrepreneurs with whom he works. He considers their technical expertise and their ability to communicate, but the big one is personality. He always looks for people who are well-rounded and possess those characteristics that have been collectively referred to by others, such as Daniel Goleman, as emotional intelligence. This is a measure of one’s self confidence, self-awareness and ability to navigate periods of stress and emotional turmoil, all of which has a direct bearing on one’s likelihood of achieving business success.

Fisher was wary of working with insecure or high maintenance individuals. By the same token, agents and publishers don’t want to work with someone who is obnoxious, demanding and can’t work with constructive feedback to improve the quality of their work. I have heard many authors and other industry professionals state that the calibre of your work is not likely to overcome your behavioural issues. On the flipside, you as the author don’t want to work with an agent who is likely to burn bridges and alienate people with their personality – another reason to have those frank discussions with other authors.

Lesson 4: Don’t slit your wrists over short-term swings in the market

In one panel, Hayden Trenholm, an award-winning Canadian science fiction author and owner of Bundoran Press, challenged the hype about the impending death of print at the hands of electronic publishing and self-published ebooks. Citing reports from Forbes and other industry watchers, he noted how the growth in ebooks has noticeably slowed since the big gains of a few years ago. Even when ebook sales were skyrocketing in the U.S., sales of traditional print books continued to rise, leading to an overall increase in the number of Americans who read.

And while we are all in awe of those few self-published authors who have achieved stardom, the fact is, the typical self-published book by a first-time author never has more than $500 in sales. The biggest successes in e-books, in terms of volumes of sales and average selling prices, is still enjoyed by the world’s six (soon to be five) largest publishers.

In other words, when volatility has impacted the market for your product, don’t react in a knee-jerk fashion to the short-term impact. Stick with the fundamentals, follow the long-term trends, and invest in what will maintain your visibility in the marketplace and ensure the customer is still there waiting for you on the other side – sales and marketing.

Lesson 5: Persistence and work ethic is everything

Some people love being a writer, while others love living the life of a writer. But thinking about it, talking about it, even blogging and Tweeting about in a way that begins to build your “author platform,” is no substitute for just bloody doing it. You need to make time and make the most of the time you have.

The difference between “doers” and “talkers” came up in a past post, when we spoke with Jon Bradford, the man behind The Difference Engine and Springboard, two U.K.-based startup accelerators. When screening applicants, a track record that demonstrates an individual entrepreneur is someone “who just gets on and does stuff, as opposed to somebody who just sits on the fence and talks about it,” is crucial for him.

It doesn’t matter who you are or what you do. It’s the ability to produce results that matter.

So there you have it. The same business fundamentals apply regardless of the industry or the product or service in question. There is always an opportunity to get a fresh perspective and learn something new for your business by looking at what’s happening in other industries.

If you have a good story to tell about how you learned something that helped your business from an industry other than your own, let me know.

Image: Innis College Student Life

Technorati Tags: Ad Astra 2013, writing, publishing, bookseller, distribution channel, author, entrepreneur, startup, product development, market development, sales, marketing, beta tester, beta reader, product launch, brand, author platform, customers, Andrew Fisher, Wesley Clover, Jon Bradford, The Difference Engine, emotional intelligence, Daniel Goleman, electronic publishing, ebook, Hayden Trenholm, Bundoran Press

‘You can’t cross a canyon in two leaps’

By Francis Moran

Canada lost one of its most populist and colourful political characters last week when former Alberta premier and Calgary mayor Ralph Klein died. There are a number of marketing lessons, both salutary and otherwise, to be drawn from the exploits of this seemingly simple man whose shoot-from-the-lip approach and unrivalled common touch made him an object of both admiration and scorn.

However, today I’m going to riff on just one of his more quotable quotes because it applies so very well to the doomed approach too many technology companies take with their belief that market traction and sustainable revenue growth can be achieved through a series of low-cost incremental steps.

“You can’t cross a canyon in two leaps,” Klein said as premier in defence of the sweeping cuts to public services he introduced in the mid-1990s to slash Alberta’s massive budget deficit. And technology companies can’t cross the chasm between product development and customer acquisition in anything less than a single bound.

I’ve written about this before, using the metaphor of achieving escape velocity to explain the huge effort it takes to get a product into market, attract the attention of your target customer, and actually start to gain revenue traction. Products are developed down here on earth, I argued, while customers are up there in orbit. Your marketing efforts must escape the gravitational pull of product development and get your product up there where the customers are. While firing the rocket thrusters is no guarantee of success, failing to do so is certain guarantee of failure. The best part is, once you have attracted the attention of your customers and started to gain revenue traction, sustaining it is as efficient as sustaining an earth orbit, costing a fraction of the effort it takes to get there in the first place.

And so it is with Klein’s pithy aphorism about canyons. It takes a leap of faith, a no-holds-barred launch off the canyon rim if you are to stand any chance of actually making it across to the other side where your customers are waiting. The only question you need to answer is: Are you going to be motorbike stuntman Robbie Knievel successfully jumping the Grand Canyon (Okay, he took a nasty tumble once he left the landing ramp, but that’s a metaphor for another day.) or are you going to be Homer Simpson, falling ignominiously into Springfield Gorge. Please tell me you didn’t just say, “D’oh!”

Image: OxfordWords blog

Technorati Tags: marketing, marketing strategy, escape velocity, product launch, product development, marketplace, customers, target customer, customer acquisition, Ralph Klein, Robbie Knievel, Homer Simpson, cross a canyon in two leaps, market traction, revenue growth

Do you know what your customer actually wants?

By Maurice Smith

I once spent a fortnight in Silicon Valley being trained in strategic planning. It was a fantastic experience. We spent the first week in groups trying to invent new products and industries, a motley crew of scientists, financiers and creatives.

In the midst of the workshops, a very opinionated participant from Miami told us – not once, but twice – that there were many modern technical inventions that no one had ever asked for – the minivan and the fax machine for starters.

Within minutes one irritated Canadian delegate had found the same unsupported assertion repeated on the Internet (AltaVista was really fast in the ’90s). The second time Mr. Miami made the claim a Swedish delegate rolled her eyes in despair and suggested he shut up.

I never did find out if anyone had actually asked for a minivan or a fax machine, but I suspect they did. Looking back it seems like one of those glib consultant anecdotes that die by repetition: Think about who moved your cheese or the one about boiling frogs.

This incident came to mind as I considered one of the key questions faced by any startup: Does the customer actually want the product?

It seems an obvious question, but most of us who have been involved with tech startups can share anecdotes that demonstrate the weakness of some people’s product development or market understanding.

A decade ago I advised a design company that had burned through $16 million of investors’ capital before discovering its real market was 5,000 miles away and in a completely different sector. At one stage, when confronted with budget cuts, its senior managers – all engineers – had cut back the marketing resources, as they carried on developing a product targeted at a market that didn’t want it.

Kevin Dorren, a great Scottish entrepreneur and founder of the successful U.K. food-to-home service Dietchef, confessed recently that Orbital Software – a knowledge management software company he led to an IPO back in autumn 2000 – didn’t really know what its customers wanted.

“We tried to sell it to too many different people, and every time we did so, someone would come up with a different requirement and we’d have to customize the product to suit their needs,” Dorren told a publication produced by a Dietchef investor, Piper Private Equity. “In the end we didn’t have a product but a toolkit that could do lots of different things, but didn’t do one thing really well.”

Dorren applied the lessons from that experience to Dietchef, pre-launch. His team targeted specific types of customers, and invited them to focus groups. Pre-launch planning lasted more than a year.

The point of all this is that – more than ever – startups need to demonstrate far more market appetite than ever before. Investors are more impressed by market research, endorsements, the makeup of the team, and so on, rather than the near-obligatory financial plan that predicts entering profit – miraculously! – by month 36.

Tech entrepreneurs are finding it’s not enough to buy the latest edition of Crossing the Chasm to carry into fundraising pitches: they might be expected to have read it, too.

Investors want to see some numbers, preferably actual sales rather than hopeful forecasts.

This applies to every sector. For the last decade or two, most of us have been taken up with tech only: Software, Web and now mobile apps. But of course many startups are businesses that take advantage of the digital age, rather than being necessarily “digital” themselves.

An example might be Dietchef. An idea that originated in California, this is an online diet service that designs menus for its clients – and then has them delivered. The company has expanded from the U.K .into continental Europe.

So is Dietchef a tech company? No. Is it a food company, a diet or health consultancy? No. It’s all of these things. And it’s succeeding because its founder learned from the mistakes of his previous life, selling a software product with features that kept changing according to the latest client fad.

Next month in Scotland, the final of something called the Scottish Edge takes place in Glasgow. Twenty startup companies are pitching for their share of prize packages worth up to £50,000.

As I scan the list of finalists, fewer than half appear to be “tech” businesses. But I’m willing to bet that every one of them will be using tech to reach their clients. Another chasm crossed, no doubt.

Image: Team Altman

Maurice Smith is a journalist, consultant and entrepreneur based in Glasgow, Scotland.

Technorati Tags: marketing, marketing strategy, moved your cheese, boiling frogs, Crossing the Chasm, Scottish Edge, Dietchef, Kevin Dorren, investors, capital, investment capital, commercialization, product development, market development, target market, customer

Why I like customer advisory boards

By Jesse Rodgers

Seeking out customer feedback and using it to build a great product is not a new concept. Great designers have been doing it for a long time as have great companies. The Lean Startup manual (or startup bible to many) talks about involving the customer while developing that minimum viable product (MVP): “The minimum viable product is that version of a new product which allows a team to collect the maximum amount of validated learning about customers with the least effort.”

Where that generally leads people is straight to building a simple application that might not be sexy in its design but it is functional or a landing page about a new product that might not exist yet. Using Google Analytics and collecting email addresses along with some “conversion” points becomes what you focus on. However, if you forget to actually talk to customers as well you could be wasting a lot of time. Especially when you are moving past your MVP or have a product that people are paying for.

Live and die by automated metrics

Sales numbers and application metrics don’t give you the whole story. Your sales numbers tell you that your marketing is working and your sales people are doing their jobs — especially if sales are going up and to the right. What those numbers don’t tell you is if people are finding the product they actually want or if it is simply close enough that they want to give it a try. Application usage metrics might help you understand if people love your product or what part they love, but this might put you in a situation where you have to react instead of being proactive on your product. By the time you figure out that you might just have good marketing and sales people and the product is off the mark (it gets obvious when your churn rate climbs) you lose momentum.

Momentum is so very important for a startup, or any business for that matter. Talking to customers regularly helps you understand the metrics better, but taking customer feedback and translating it into product effectively eludes many because it is an art, not a science.

I like the “old fashioned” process of drawing out a prototype, spending time with who you think your customer is, listening to them and answering their questions. Automation can come later. If I want to collect the most information with the least effort I want paper prototypes and discussions with customers. I can’t emphasize enough how important that first highly talkative but very loosely connected (socially) customer is (the alpha customer).

Once you have built something you can track all the metrics you want but I would argue you will not get good insight on your customer with automated measurements alone. Having sat in on enough usability studies over the years, I don’t think that how people use something represents their interest in using that something, most of the time. By sitting down and talking to customers you build a much better persona in your mind of who your customer is and what those automated numbers actually mean.

Go back to the customer regularly

If you want customer feedback to be enshrined in your organizational culture you need to put a formal process around it. The established way to do this is by setting up a “customer advisory board” made up of your most feedback-giving customers. You can call it something else if you like but don’t leave out the basics:

Treat the customers in this group with the same respect you treat your board of directors. They are volunteering their time and providing invaluable feedback.
Be as open and transparent with this group as possible. Create an environment where they aren’t afraid to offend you about your product and be totally open with them about future product direction. If you feel they must sign a non-disclosure agreement to be comfortable with being open, ask them to do so.

How it works is really simple. You have a scheduled meeting at a regular interval, use your favorite screen-sharing conference application (Google hangouts work really well btw), and start listening to your customers. Take lots of notes, write a summary of the meeting and share it with the board members. You can use that to keep the conversation going via email between meetings. From there you can decide what level of participation and engagement works for you. It is a process to start using a customer advisory board well so ease into it and enjoy it.

The advantage of setting up something a bit more formal is that you are making a commitment to use it. The timing on doing this for a startup could be on day one as you build out your MVP. If you are a company with a product that is selling now but don’t have a customer feedback process in place, you should certainly think about taking this step.

This post was originally published on Jesse’s blog, Who you calling a Jesse?

Technorati Tags: Customer advisory board, customer feedback, product development, minimum viable product, Lean Startup Manual, sales numbers, application metrics, sales, marketing, churn rate, startup, prototype, entrepreneurship, Alpha customer, board of directors

Managing perceptions and product at RIM like Apple did

By Jesse Rodgers

A tweet by Peter Mansbridge brought a lot of people’s attention to an article entitled Steve Jobs’ Lesson for RIM: Power of Perceptions, Turnaround 101, which focuses on how Steve Jobs changed the perception of Apple. That perception shift was driven a lot by product, and it wasn’t the iPod that did it. It was the other product — the Mac computer — and Apple’s ability to extend the life of a dead OS. Apple focused on revenue building and its “cult of mac” first.

The problem Steve Jobs faced with Apple’s OS going from the OS 8/9 to X and where RIM is now feels very similar. Apple extended the life of a dead OS while it built the OS for its future (OS X), the one that gave it the flexibility to build the iPod, the iPhone, and beyond. Did Jobs manage perceptions through how he spoke about Apple? Sure, but he also needed his product to deliver on the promise that Apple is innovative and cool.

Managing the OS shift over the years: Think different

It is worth looking at Apple OS 8/9 as this is where the perception change began. Compared to Windows 98, Apple OS seemed limited. There were few games, limited software available (mainly multimedia-focused software), and these ugly beige boxes. Building a new OS is hard, though, and Apple was out of money. The company needed to sell product in the interim. Since it couldn’t yet bring a new OS to market, it changed the easier part and went rather experimental on the hardware. Bondi Blue iMacs, Power Mac (blue G3, graphite G4), Cubes (at the end of OS days), Clam Shell ibooks and Titanium bodied laptops. These experimental designs appealed to the multimedia creative crowd that used Apple for work. At first I think the designs were largely cosmetic but it didn’t matter. It was different.

This perception shift was product driven and brilliant. The faithful kept faith because there were constant updates and new ideas being offered to them. It was different, it was cool, it was worth that Apple premium on “top end” hardware. I remember when I first opened the side of a Graphite G4 in 1998 when my uni room mate got one. It was way cooler than anything I had seen before.

Then enter OS X.

The 1998-2001 section in this Wikipedia article goes through the period before OS X, which was basically the perception shift “heavy lifting” period.

Lesson for RIM is 1998-2001 Apple

RIM is a mobile computing company with a BB OS 7 reaching the end of its life. It has devices that don’t capture the imagination (but who does at the moment?), and a hardcore group of users similar to the Apple fans of that transition period at Apple. In order to “pull an Apple,” RIM needs to capture people’s imagination with BB OS 7 now and slow down the talk on OS 10 outside of the dev community. Outside of devs I don’t think people care what OS it is anyway, they just want email and messaging.

With BB OS 10 coming soon, the company could do some things to win over fans:

The latest Bold is a nice device, and the Porche designed one is kinda cool. RIM should do more of this but make its products inexpensive.
Offer those who get the latest Bold now the new BB OS 10 device in exchange for $100 and offer app store credit of $100.
Do something awesome with the NFC tech — help a loyalty program deploy it and offer some crazy promotion on Bolds, give a Bold to every person at the NFL season opener and have their tickets managed via NFC on the device, etc.

I am certain that if you get the right people in a room with a whiteboard for a week (they should be at the FELT lab every day!) they would come out with a few things that are possible to do relatively quickly to excite the loyal fan base. It seems like Alec Saunders is building his team still so maybe that is where the magic is going to happen. I hope so.

This post was originally published on Jesse’s blog, Who you calling a Jesse?

Technorati Tags: RIM, Apple, managing perceptions, product development, product marketing, technology marketing, mobile, marketing strategy, cult of Mac, Steve Jobs, think different

Balancing investment, Minimum Viable Product, and time to market

By Peter Hanschke

I was a panelist at the latest Agile Ottawa meeting where we discussed our experiences with the process and concepts of Eric Ries‘ lean startup methodology. Today, I will share some of the points I made during the discussions.

By the time I got to reading Eric’s book, I was well on my way to using and advising clients and my employers on many of his teachings. Even though he focuses on startups, the principles in general are applicable to larger companies that need to bring new products to market with little investment. Note that larger companies have other challenges to successfully introduce new products quickly with little investment – Clayton Christensen‘s book The Innovator’s Dilemma does a good job of outlining these challenges.

The area I want to focus on is the balance between investment, Minimum Viable Product (MVP), and time to market.

Investment

Money is not plentiful these days. Startups need to prove themselves (or in some cases over-prove themselves) before external money flows their way. Through family, friends, and angels, startups juggle their investments to develop their MVPs, marketing, and selling. Having an office for a startup is a luxury that is in some cases delayed until much later. Larger, established companies are conservative when investing in new products, especially as more companies look to embrace mobile platforms for their products where revenue may not flow for a while. A modicum of creativity is required to be able to bring a new product to market. Everyone has to live within their means.

MVP

My blog post on creating your minimum viable product talks about the mechanics of defining the MVP. In this context, however, the MVP needs to match the needs of your early potential customers and/or users. In The Lean Startup, Eric talks about the need to “pivot and zoom out or in.” What this means is that if your MVP is not gaining traction with the potential customers you talk to, it needs to address more or less of the whole product or the value chain you plan to sell your product into.

Time to market

In other than a few instances, time to market can be very subjective. Quite often, through healthy paranoia, time to market is defined as ASAP. In other words, entrepreneurs need to have in the back of their minds that someone is doing exactly the same thing and will win the race to be first to market. Maybe it’s competitiveness, but time is always of the essence. The market and customers’ desires turn on a dime (save maybe the government and other large groups).

There needs to be a balance of all three of these factors. There is no scientific formula — if there were, it would be patented and there would be a lot more successes than failures! I am not espousing that each element must be equally weighted. In fact, the weighting changes over time as the business environment changes. The concern, however, is the impact that each item has on the other as weightings change.

With close to an infinite amount of available investment, the MVP can be built within the timeframes desired. But as I point out in my blog on the million-dollar cheque, there is a risk of bloating your MVP to the point where it satisfies more than what is needed in the market and that’s a waste. But an infinite amount available to invest is unrealistic. The reality is that everybody inherently wants to add more features to the MVP so the level of available investment provides a natural limit on what can be done. Tough decisions need to be made so that only what is absolutely required is built.

With a small level of investment, the MVP becomes restricted to address a small set of use cases and/or roles to meet the time to market requirements. The risk is that the MVP may not address enough of the required solution for customers to be interested and ideally willing to use it in any substantial way. And therefore the time to market is pushed out to accommodate the additional needs of the market. The complications with this situation are that (a) a competitor enters the market first, scooping the attention and early customers, and (b) the market and target platforms shift underneath as a result of changes in technology and/or customer desires. In both cases, a change to the MVP may be required, which requires more investment and/or pushing out the time to market.

So what’s the answer? There is no magic bullet, but here are some helpful tips:

1. Get feedback

You need to have a system in place to easily get feedback from users/customers. Launching a product without the mechanism to get feedback is useless. You may have hundreds of users and no way to know whether they like the product, hate it or if it meets their needs or not. In the B2B/B2G world this is relatively straightforward — you know who your users are. It’s far more of a relationship or one-on-one sale — you know them and you know how to get a hold of them. In the B2C world this is more challenging. Especially with mobile apps, which are primarily anonymously (to you) downloaded from an eStore like iTunes or Google Play. Early on, make sure you have a communication “pipeline” to the user in your product or on your website to engage them.

2. React

You need to have a development process in place that allows you to react quickly. It is essential to be able to gather feedback, analyze it, prioritize it, make product changes and re-deploy it as quickly as possible. Your users will be impressed with the service and it keeps you and your product at the top of your customers’ minds.

3. Stay informed

The worst assumption that anyone can make is that they won’t be scooped. Introducing a new product requires a healthy dose of paranoia. In other words, you have to adopt the attitude that you are not the only one with the same idea and that you are going to beat them to market. This attitude requires constant attention to changes in the market. Any new product announcement that hints of being a potential competitor needs investigation. Any changes to platform technologies and/or customer attitudes toward the market need to be analyzed. Become great at gathering information and triangulating.

Remember to achieve a balance between the investment you have, the MVP needed to get users engaged with your product, and the time you need to enter the market. Every situation will be different.

Technorati Tags: Minimum viable product, MVP, investment, time to market, marketing, product marketing, product development, financing, Agile Ottawa, Eric Ries, The Lean Startup, startup, entrepreneurship, Clayton Christensen, The innovator’s dilemma, patent, innovation

How to make better inventions: Part 2

By David French

This is the conclusion of a two-part series. Part one introduced patent searching and how inventors can use the “prior art wall” to their advantage.

Whether or not a prefiling patent novelty search establishes that the road is clear for you to attempt to obtain patent rights, there is tremendous value to be obtained by just carrying out the search. In my last post, I explored this premise and started down the path to demonstrate how you can conduct a search of documents that are online at the U.S. Patent Office.

To recap, I shared tips for searching with key words using this page on the U.S. PTO website. As an example, the search was focused on an improved garden rake. Documents relating to rakes were located by initially entering the words “rake” and “handle.” I also suggested that searching can be conducted using the classification system available in the U.S. PTO website, which is what I will explain here today.

Classification searching

There is an index page on the U.S. PTO website that gives access to classification manuals. The documentation surrounding classification is extensive. There are around 1,000 principal classes and within each principal class there are many hundreds of subclasses and sub-sub classes. It is difficult to learn about classification through entering the classification system directly.

Conveniently, every issued patent has a reference to its principal class included on the cover of the printed patent, or on the HTML page for the patent at the U.S. PTO website. In part one, we used keyword searching to locate a relevant patent — U.S. patent 7,987,658, called “Multi-purpose garden tool with pivotable gardening head.” Clicking on this reference takes us to an abstract that describes a garden rake. There is also a link to images at the top of the screen. (Viewing these images requires a TIF reader, which can be downloaded by clicking the red “Help” link in the yellow bar above the black space where the pictures should be on the “Images” page).

This patent can be used as a root to switch to “classification searching” by clicking back to the patent’s abstract. All U.S. patents are classified according to the focal point or novel feature of the invention. Searching down the screen of our gardening rake patent, we find that it has been classified primarily in U.S. Class 56/400.19. (And it has been cross-classified in U.S. Classes 15/144.1; 16/900; 294/53.5; 56/400.04; all of these other classes would be relevant for an expanded search.)

After a deeper search on the U.S. PTO website, we learn that U.S. Class 56 relates to “HARVESTERS.” Additionally, subclass 400.01 under Class 56 relates to “hand rakes” and subclass 400.19 is a sub-subclass under subclass 400.01 for inventions wherein the novel feature is “adjustable, folding or take-down.”

In this exercise, we need only note the principal class, 56. Using the browser’s “back” button to return to the “Refine Search” box on the search page, we can amend the search string to read as follows:

rake and handle and (claw or hook) and ccl/56/$

(Open and use the “Advanced” red link at the top of the screen if “Refine Search” is not available through a back button from the screen for US patent 7,987,658.)

The search result is as follows:

Results of Search in U.S. Patent Collection db for:
(((rake and handle) and (claw or hook)) and CCL/56/$): 56 patents.

This is a result that is a manageable size.

By the way, the search term “ccl/56/$” stands for “current class/56/any subclass,” where the symbol “$” serves as a wildcard for any of the subclasses under Class 56 — harvesters. When using class as a search term both a class and subclass must be specified. A search using the term “CCL/56/400$” returns 39 hits, with all of the hits qualifying as relating to “hand rakes” under subclasses 400.01 through 400.21.

It’s now time to decide what the invention is that we are searching for. For the purposes of this exercise it could be anything that involves a rake with a handle and a claw or a hook. Perhaps the invention is a rake with a handle that includes both a claw and a hook pointing out at e.g., 45° from the backside of the rake. But that doesn’t matter.

The purpose of this exercise is to show the rich opportunities to learn that can arise by looking at the now truncated list of 56 or 39 patent references related to the search terms that have been employed. This is a very quick way to understand the business of gardening tools. Every one of these patent references has a generous number of drawings and an elaborate description as to which features are important. What a way to get smart fast in the field of your invention!

And here is a bonus. Return to the Refine Search box, which reads, “rake and handle and (claw or hook) and ccl/56/$,” and copy this string. Then go to the top of the search screen and click “Home.” This is not Home for the U.S. PTO website, but Home for the searching tools. On the right side of the Home screen, divided into three parts, is a column referring to “Applications.” This refers to pending applications rather than issued patents. So far, only issued patents have been searched. Under Applications, click “Advanced Search” and paste the above string in the box that is presented under the word “Query” and click “Search.”

The result is a list of applications filed at the U.S. PTO since 2001 that contain the terms of the search string, vis:

Results of Search in AppFT Database for:
rake and handle and (claw or hook) and ccl/56/$: 25 applications.

Every one of these applications is well worth looking at if you are curious to see what other people are doing.

The purpose of this exercise is to demonstrate that patent searching is not just about patenting. It is also about making better inventions! If you want to be a great inventor, don’t leave reviewing the prior art to some professional. Do it yourself and become wiser for it. Any questions?

Technorati Tags: David French, intellectual property, IP, patent law, patenting, patent searching, patent, patent novelty, US Patent Office, patent classification searching, product management, product development, invention, inventing, startup

The root of all evil

By Leo Valiquette

Back in November, Peter Hanschke blogged about the need for the lean and mean startup to beware the million-dollar cheque. In that spirit, I have an anecdote to share which illustrates that the mere prospect of such a windfall can also do significant damage.

At a time when early-stage ventures, particularly those in Canada, are thirsting for capital, be it traditional VC or an angel round, it may seem counterintuitive to suggest that a startup should be wary of a nice fat cheque.

But as Peter explained, for a startup that has taken a lean and frugal approach to market that relies on iterative product development and using a Minimum Viable Product approach, a sudden windfall of cash can have all sorts of negative consequences. The most obvious of these is that the product, which has until now been developed with only those features and functions that have the strongest market pull, gets bloated with all sorts of additional bells and whistles that dilute its focus and send the sales and marketing teams running in too many directions.

My story isn’t a clear-cut example of this, but the same lessons apply. This venture, let’s call it BigContent, was developing a unique library of content which it would make available through a subscription model. It was incubated with a nest egg the founders had put together from a previous venture. In fact, it was their experience with that previous venture which provided them with the idea for BigContent, as well as the initial proof of concept. From a marketing standpoint, BigContent’s founders were doing exactly what they should to identify, define and validate a strong market opportunity which BigContent could exploit.

Executing BigContent’s business plan didn’t require external financing. The founders were wholly committed to bootstrapping the venture through to positive cash flow. BigContent proceeded to develop its library of content, a distribution model through which to deliver that content and a strong roster of subscribers. Everything was proceeding well toward a soft launch of its service.

And then a Big Name VC comes calling without an invitation.

Well, what startup on the eve of its launch is going to slam the door in a VC’s face? At the VC’s behest, launch plans were put on hold. BigContent’s founders revamped their business plan to reflect the addition of external financing. A VC round may not have been necessary to BigContent’s get-to-market strategy, but it would certainly have accelerated the process and made for a bigger, bolder launch.

Big Name VC made lofty promises, even said it would bring one of its compadres to the table. Meetings were scheduled, then cancelled. After several months of song and dance, the VCs said a polite “No thank you” and moved on.

The damage was done. BigContent’s lean and mean go-to-market strategy was in shambles. One of the principals had also resigned from the company. Months later, the team is still trying to get everything back on track for a launch, as per the original business plan.

I don’t intend this post as a knock against VCs, but this story does demonstrate that both parties to a deal must always beware. The onus is on the entrepreneur to have a clear understanding of where their business is going and what it will take to get it there. There is always more than one route to a destination and the choices which lie along the way seldom fit easily into the “right” and “wrong” columns. If there’s a moral to this story, perhaps it’s the importance of staying the course when in the midst of executing a plan in which you have confidence.

What do you think?

Technorati Tags: financing, investor, startup, entrepreneur, VC, venture capital, business launch, business plan, bootstrap, get to market, market validation, minimum viable product, MVP, product development, iterative

Yikes … we forgot the demo!

Associate Peter Hanschke is an Ottawa-based product management specialist. His post is part of our continuing series about the ecosystem necessary to bring technology to market. We welcome your comments.

By Peter Hanschke

The ability to demo your product to a prospect is a key activity in the sales process. Prospects struggle to make the connection between what is shown in a slide deck and the issues that they need to address or the problems they need to solve. Furthermore, they also need to be assured that the product you are describing is simply not slide ware. A properly constructed demo that shows how the prospect can address their issues takes time and effort to create. But many companies leave the design and creation of the demo to the last possible moment. The result is the standby method– open the product, show individual features and hope that one or more of the features resonates with the prospect.

The problem is that the prospect is looking for a solution to a problem that they currently have – not a set of features.

Prospects are interested in buying your product or service only if it addresses a need or problem that they have. In today’s tight economy, products that address issues will be considered more favorably than those that are simply a collection of features. The intent of a demo is to show the capabilities of your product in such a way that resonates with the prospect. The prospect needs to truly understand how your product addresses their core issues. Upon completion of the demo, the prospect should have a clear vision of exactly how your product helps them.

Start with the problem, not the feature

Let’s first dissect the demo. The design of a demo must start with a clear understanding of the user (or market) problems that your product solves. In other words, what are the challenges your prospects have in performing the tasks they need to perform that your product addresses? The design must never start from the features. If you get a “nice feature …how does it help me?” look or comment from the prospect, then the design of the demo did not start from the problem space, it started from the solution space.

It is key to clearly articulate all of the common and unique problems that your product solves. Create a list of the problems along with a description of how your product solves them. Highlight those problems that you uniquely solve or solve in a manner that far exceeds the alternatives. “Me too” solutions are table-stakes – users regard those as must haves and if that is all your product solves it may be time to re-think your product strategy.

Make sure to describe the problem and your solution in a manner that resonates with the user. This is critical, but in most cases is overlooked. Think of your prospect. Using language that they understand is vital for them to instantly identify with what you are describing. If they do not resonate with any of the problems you solve, then they’re not a match for your product and odds are you will not make the sale.

Take it one step at a time

For complex products or solutions, split the demo into three parts.

Part one should be brief (one minute). The idea is to whet their appetite to want to see more. The key value proposition must ring through loud and clear. Within 10 seconds the prospect should have an idea what your product is and why it matters to them. This could take place in the typical elevator or at your booth. Follow that with a brief demo – no more than 40 seconds. At this point the prospect either realizes that your product can help them or not. You are successful with part one if the prospect wants to see more.

Part two is longer – typically five minutes. This part should highlight the core problems that your product addresses. As mentioned earlier, using the “open the product and start showing the menu commands and what they do” approach will typically not produce positive results. There is a flow to the demo showing the prospect how specific problems are solved with the product. Start with showing the key benefits, then follow up with secondary benefits.

For example, if you sell your product to business to create internal or external facing products, then start with showing the benefits that your prospect’s customers receive. If canned data (e.g. contact data, manufacturing data) is needed, this needs to be thought through so that (a) it works in conjunction with the demo, and (b) it can be easily reset to its original state. Success at this point is the prospect wanting others in their organization to see the demo – they believe that your product will provide value to their organization.

Part three is a demo that does a deep dive to prove to the audience that your product is right for them. This is usually a custom demo that requires multiple conversations with the prospect to show exactly what they are looking for. A word of caution – anything beyond creating a custom demo for a specific meeting could venture into the realm of creating a proof of concept, which is beyond the scope of a demo.

Too many companies jump right into part three; the audience becomes confused and the engagement does not progress well after that. Avoid this at all costs. Start with either part one or two … depending on the time you have. If your product is not very complex, then parts one and two are sufficient.

Keep it part of the big picture

The design and creation of the demo needs to be part of the overall product development project. It needs to be scheduled and staffed just like any other activity. If not, then the risk of not having a top-notch demo is in jeopardy. The product manager is responsible for ensuring that the demo is part of the schedule. They are also responsible for gathering requirements for the demo. In some cases the development team will be needed to implement some of, or the entire, demo. In other cases it might be the product manager who implements the demo. The bottom line is to treat the demo as a mini-product and apply the same rigour to defining and creating it as you would the main product.

So to recap:

Make sure the demo is designed from the prospect’s perspective (i.e. their need for your product to solve/address their problems/issues).
Implement the demo in small digestible parts such that you educate the prospect through the demo process (never start by showing the deep details).
Ensure that the design and creation of the demo is a part of the overall project plan (i.e. it needs to be scheduled and staffed).

Technorati Tags: demo, product demo, sales, sales prospect, product development, product manager, customer, sales cycle, sales process, features, benefits, solution

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