Clever videos drive viral growth @honda : 5m views @okgo : 23m views

Honda have produced a fantastic video riffing off the line “the impossible made possible”. Great thought and effort went into this one, but also very clever. and it is getting results. 5.5 million views to date.

Equally clever, from a different perspective (sic) here is the group OK Go who are famous for their videos, rather than their music. But their videos drive music sales.  The video below has had 12m views. Their first video on treadmills now has had 23 million views.

 

Tattoo decisions – and science tattoos

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READ TIME: 2 mins

Tattoo decisions. We don’t make many of them in life of business. But when we do make them we need to make sure that they are right. Because any reversing the changes are very painful. Here is a very funny spoof advert for Turlingtons Tattoo Removal Cream.

In business there are relatively few tattoo decisions. These involve a key decision, and then telling lots of people about it (like that Tramp Stamp tattoo):

Pretty much everything else you can reverse or change; choice of CEO, product pricing, product functionality, distribution partnerships, website design, company branding.

Interestingly in life there are even fewer tattoo decisions – except of course – actually getting a tattoo. Even getting married is probably not a tattoo decision any more. Probably the biggest tattoo decision is having children, or robbing a bank (and getting caught).  Just thought of another one – getting a turtle as a pet. They live to 60 years old. Max, my son, has 2 of them and if they survive time at college with him they will outlive me.

Every other decision (that is legal) is not a tattoo decision; where to live, which school to send your kids to, which course to take, what job to accept, what hobby to take up, what car to buy.

So why do people procrastinate about make all these decisions?  They are putting their life on hold whilst they try and decide. So, make a decision and then work to make the best of that decision.

Interesting side note. There is a genre of tattoos I heard about today: science tattoos.  Here is an Pinterest feed of science tattoos.  Quite remarkable.

Pivot before the cash runs out *updated*

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READ TIME:  2 mins

HINT: Pivoting is not a business strategy, but a tactic.
HINT: Constantly pivoting is called a “death spiral”

Pivot is not a business strategy

Nowadays the trendy way to mask a failure is to successfully pivot – before the cash runs out – and then become successful. But for every one of these successful pivots there are hundreds, if not thousands, of technology companies that have crashed and burned. Sadly, they ran out of funding before they discovered their perfect market. Or they are limping along barely breaking even each month.

Words like “pivot” and the related “iterate” have been used in and around Silicon Valley for several years, generally to describe “failing gracefully”.

But their use has picked up significantly in recently amid the broader public’s fascination with the entrepreneurs behind high-profile start-ups, some of whom were able to get funding from investors despite significant changes in their original business plans.

Ben Horowitz of venture-capital firm Andreessen Horowitz used the word “pivot” three times in a nearly 800-word blog post to discuss the firm’s investments in businesses such as Burbn.

Never heard of Burbn? I am not surprised. Burbn attempted to put a new spin on the idea of virtually checking in at various locations via smartphones, then broadcasting that visit to one’s social network. It enabled people to leave messages via their phones that could be retrieved by others visiting the same location. The idea evolved, and turned into a mobile app that would allow people to take photos, alter them visually and share them. That app was called Instagram which was sold to Facebook for $1 billion.

“Pivot to me is not a four-letter word,” says Tony Conrad, a partner in the early-stage venture capital firm True Ventures. “It represents some of the best methodology that the Valley has invented. Starting something, determining it’s not working, and then leveraging aspects of [that] technology is extremely powerful.”

Investors say the founders who are not afraid to pivot are generally more experienced—and less fearful of failure—than past generations of tech entrepreneurs. The founders who change solutions and markets between one and three times raise more money than those who don’t, according to Startup Genome Compass, which tracks more than 13,000 Internet start-ups. In fact, they raised roughly 2½ times more capital than founders who changed solutions and markets either four or more times or not at all.

However revolutionary this seems, there is a fundamental point.

No matter how many pivots you make and how understanding your investors – eventually you need to find a market that works. That is why we wrote IMPACT (download free abridged copy). But to give you all hope, inspiration and amusement I have listed a few of the most successful pivots.

Successful pivots

Groupon

Then: It started as ThePoint.com, a site launched in November 2007 that lets you start a campaign asking people to give money or do something as a group – but only once a “tipping-point” of people agree to participate.

Now: Groupon is the group-buying site that helps people save money all over the country through targeted offers.

Instagram

Then: The founders had built a location-based service called Burbn, most comparable to Foursquare. You could check into locations, earn points for hanging out with their friends, and share pictures inside of the app.

Now: Instagram is a hugely popular app for adding artsy filters to your photos and sharing them over Facebook and Twitter.

Exit: Sold to Facebook for $1billion

Flickr

Then: It was Game Neverending, a massively multiplayer online roleplaying game that ran from 2002-2004.

Now: Flickr is one of the go-to sites for sharing photos online, popular among amateur and professional photographers.

Exit: Sold to Yahoo in 2007 for $40 million.

Facebook

Then: It was Facemash, a site comparable to HotOrNot.com, putting two pictures of people next to each other and asking the user to identify which one was “hotter.”

Now: It’s Facebook. If you don’t have an account and use it actively, you’ve at least heard of it. 

Twitter

Then: It was Odeo, a service that revolved around personal podcasting and sharing audio content.

Now: It’s Twitter. People use it to share thoughts and updates in 140-character bursts.

PayPal

Then: It started as Confinity, a cryptography company designed for exchanging money over Palm Pilots. It didn’t work well, but they did identify the lucrative market space of enabling people to take credit card payments.

Now: PayPal is the brand-name way to pay for items online.

Exit: Acquired by eBay in 2002 for $1.5 billion.

Rapt

Then: Started as supply-chain management optimization for high-tech manufacturers.

Now: Shifted to dynamic ad price optimization for online media companies.

Exit: They were bought by Microsoft for undisclosed price.

YouTube

Then: It was a video online dating site

Now: YouTube is the go-to location for internet video.

Exit: It was acquired by Google for $1.65 billion in stock.

Slack

Then: Their first product was Glitch, a Flash-based massively multiplayer online game.

Now: Tiny Speck launched Slack in August 2013 and they have just raised an additional $120m taking the total to $180m.

IMAGE: Pivot Digital Strategies

 

The vital signs for B2B tech company failure

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Image: TechCocktail

What is failure: the vital signs

What are the vital signs that an innovative B2B tech company may be in trouble? A deeper problem may be covered up by glimpses of success. Narrowly missing your quarterly sales target, but with big deals forecast for the end of the year does not seem to be a red flag. However, come the end of the year and none of the big deals have closed and suddenly it is panic stations. For most early stage growth companies that are constantly running on tight funding it could be terminal. It will certainly be the end of the CEOs career.

These signs should alert executives and investors to take a closer look at their strategy, go to market (GTM) and business model. For starters we have:

  • Every business buyer you approach loves the solution, didn’t realize you even existed and is unable to find any serious budget.
  • It is proving impossible to forecast sales closure on deals.
  • You are making sales, but they are only pilots, and the larger follow-on deals are stalling and delayed. Often you have multiple pilots in a single client.
  • The cost of sales is too high to be sustainable long term: the business model does not work.
  • You have hired a big-hitter sales guy with a proven track record from an established big tech company, but they are not delivering.
  • The analysts firms such as Gartner or Forrester don’t seem get it and there is no Magic Quadrant or Wave that you naturally fit into.
  • You are struggling to recruit partners who are able to resell the solution without huge levels of support from you.
  • You have high levels of professional services vs. license sales.
  • The customer’s IT and procurement teams are getting involved and are now proving to be a major roadblock.

Avoiding failure

Our 25 years of research has shown that every buyer follows a universal buying process, irrespective of industry, country or market and we have distilled this process into 6 steps; IMPACT. Idea, Mentor, Position, Assess, Case, Transaction.

The buyer of your disruptive and innovative solution is the Early Adopter (Geoffrey Moore; “Crossing the Chasm”). Early Adopters talk to vendors at the Mentor stage and work with them through to Transaction. Sadly most early stage companies try to engage their buyers as though they were Early Majority, which is not until the Case stage. With disastrous results.

Download the free book summary

Hiring a booth babe is SO, SO wrong, or not.

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Companies still do it. They hire “booth babes” to work the stand, attract punters and scan badges. They are paid per scan. Yes it is still that shallow.  Here are 3 reasons why this is a bad idea, and 1 reason probably it isn’t.

NO: Qualified leads, not any lead

Every time you scan someone it is another lead in a database to be qualified. The best time to qualify the lead is when they are standing in front of you. Not 1 weeks after the event by email or constant chasing them by phone. Use staff who understand your products and your customers on the stand.

NO: Attracting the wrong people clogs up the stand

If you have hordes of people wanting to talk to / oogle / be seen next to the booth babe then it is stopping genuine potential customers get to your stand to register their interest or get more information.

NO: Wrong image of your company

Is this really supporting the brand values of the company? If it is, like GoDaddy or Wheels and Heals magazine then fine. But for 99% of you it probably isn’t. It doesn’t help you recruit customers, partners or employees.

YES: Brand awareness through selfies

If you want to shamelessly get your brand out there. Cash in on men’s weakness to be seen with attractive women plus the trend for selfies. Set up the booth babe taking selfies with punters where the company branding is very visible in the selfie, either on the model’s skimpy clothing or the background. BUT only if it supports your brand values.

The image is from the “Wheels and Heels magazine” stand – so probably on-brand.

 

Why and how VCs will kill your early stage B2B company

gun to head

VCs kill their porfolio companies

It is not out of choice or malicious intent, but through ignorance.  This is something we are trying to address by writing IMPACT and getting VCs to read it. VCs are a powerful voice on the boards of your start-up. Partly because of their shareholding, but also because they “have seen it and done it”. Except they haven’t. In many cases they have “seen it, not done it”. They don’t have the time to really understand the nitty gritty of what is happening inside a company. They have to take a fairly hands off, 50k feet view and be driven by the management reports.  But that doesn’t stop them having a view, which can be forceful when the company is struggling.

Why VCs step in and force management’s hand

When you don’t hit the numbers on your business plan, it starts to get ugly. Narrowly missing your quarterly sales target, but with big deals forecast for the end of the year does not seem to be a red flag. However, come the end of the year and none of the big deals have closed and suddenly it is panic stations. But the biggest issue is “It is proving impossible to forecast sales closure on deals.” That spooks VCs.

But there are other vital signs for an innovative tech company that there are underlying problems:

  • The solution should be selling in far greater volumes. Sales really isn’t scaling as expected.
  • Every business buyer you approach loves the solution but is unable to find any serious budget.
  • You are making sales, but they are only pilots, and the larger follow-on deals are stalling and delayed. And often you have multiple pilots in a single client.
  • The cost of sales is too high to be sustainable long term: the business model does not work.
  • You have hired a big-hitter sales guy with a proven track record from an established big tech company, but they are not delivering.
  • The analysts firms such as Gartner or Forrester don’t seem get it and there is no Magic Quadrant or Wave that you naturally fit into.
  • You are struggling to recruit partners who are able to resell the solution without huge levels of support from you.
  • You have high levels of professional services vs. license sales.
  • The customer’s IT and procurement teams are getting involved and are now proving to be a major roadblock.

The VC answer (which is wrong)

“Go and get a hard hitting Oracle sales guy”. The reason this is totally wrong is hidden in the IMPACT buying process.  You need to read the book summary to understand the IMPACT cycle that the buyer goes through.  But in summary:

The six key phases of the process are easy to remember as they have an enormous IMPACT on your company’s performance:

Idea – Mentor – Position – Assessment – Case – Transaction

Every purchase goes through all six phases, with or without the vendor (your) assistance. The reason that you probably don’t recognize this process is because the customer goes through the process on their own, and only invites you in at a certain point. What is critically important is the point at which you are invited in, as it affects how you engage with the buyer. And that in turn determines the operational culture of your company – i.e. how you organize, run and measure.

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There are the Early Adopters (EA) who are happy buying innovative solutions. There are the Early Majority (EM) who want to buy the market leader. And there are the Late Majority (LM) who want to buy a commodity at the cheapest price. Here is where the buyer starts to engage in terms of the IMPACT process.

The Early Adopters are inspired when you or a consultant meets them and suggests an idea that reveals things to them that they did not already know. So the opportunity is generated by you when you connect with an evangelist in the customer at Mentor. That means you are working with the customer from Mentor through to Transaction. This is unlikely to be competitive, but highly consultative.

The Early Majority reach out to potential vendors when they have a set of requirements and a budget, so they have built their own business case – at Case. So you would work with the customer – procurement and IT – through Case and Transaction in a competitive procurement process.

The Late Majority only makes contact when they are ready to place an order – at Transaction. This will be from the procurement team at the customer and will be a “sharpen your pencil and give me your best price” gig.

The customer goes through the full cycle, with or without you. Once you are invited in, you are with them on the journey through to Transaction, no matter how long it takes and how much effort is required from you and the customer. The only alternative is that at some stage the idea is shelved or dropped.

The Oracle sales guy (or equivalent) is used to selling to the Early Majority who have a budget, set of requirements, RFP and a procurement cycle. They are confused, frustrated and cannot understand the buyer behaviour of the Early Adopter. They see buyers and commissions. They are oblivious to the IMPACT process as they pitch and close customers. They fail but drag the company down with them.

VCs are equally confused as they don’t know about the IMPACT buying cycle and want you to be selling to the Early majority, because that is where the big money is made. But because you are innovative and early stage. So your market is not mature enough for the Early Majority to purchase.

Coaching your VC

VCs need to understand the implications of the IMPACT cycle and your place within it.  You cannot change it.  You cannot magically sell to the Early Majority – nor do you want to – yet.  You need to take your VC through the IMPACT cycle and explain where you are engaging customers. Give them the book summary. And get them to read it  Or get me to talk to them.  I am the “stranger with a briefcase” so will possibly have more credibility.

What should VCs do?

The concepts in IMPACT are equally important for investors as they are for CEOs. Before they invest in a company, does it have the correct business model and operational culture? A pretty fundamental question. But simply asking the management of the company you are about to invest in is probably not enough. They are hardly going to say that they didn’t have the correct business model. Clearly this is not the only due diligence. You still need to evaluate the management team, the solution, the market, and the competition. But now you have another lens or perspective that will make you ask some different questions throughout the due diligence:

  • How attuned is the management team to the different buying cultures?
  • Is the solution, or the target markets for the solution, likely to be Value Added or Value Created?
  • Are the management and sales team hard-core Value Added or consultative Value Created?
  • Is the competition aligned with their buying cultures, or is there an opportunity to sneak an advantage?
  • If there is misalignment between the company’s operational culture and the market buying culture, can you influence it to dramatically scale the company?

A fairly simple, quick, and relatively unobtrusive approach would be to do the analysis of solution/proposition vs. buying culture. This will give you a clear view on their alignment and massively de-risk your investment.

They also have a portfolio of companies they have invested in. How many of the companies with great solutions are failing to meet expectations when you invested? Have they simply written them off as part of ‘portfolio investing’ – you get some stars and some dogs. Sometimes you cannot legislate which are going to be stars or dogs. So a good investor makes so much on the stars that the dogs don’t matter to the portfolio.

What if that were not 100 percent true? They don’t invest in dogs. They perform weeks of expensive due diligence to avoid the dogs. They hope to pick only stars – so what goes wrong? What if they could help the dogs become stars, just by applying the buying culture and IMPACT principles?

A radical new way to publish a book

publishing

Rethinking book publishing

Download the book summary:
IMPACT - the technology executive’s guide for selling B2B disruptive and innovative solutions

Having recently read the Lean Startup by Eric Ries a thought struck me as we started to rewrite Why Killer Products. We originally published it in 2008 which was appalling timing as the whole world was in melt down and survival was the only thing an executive wanted to think about. But now, we have a digital goldrush as everyone wants to be an entrepreneur. So we are re-writing it and making it more focused on executives in tech startups selling B2B.  So, why follow the same worn old path?

Traditional approach
  1. research
  2. write full book
  3. get reviewer feedback
  4. rewrite book
  5. publish
  6. write book summary
  7. promote
  8. wait for feedback.
A radical approach

However, we are taking a different approach to the book. We have written a 25 page book summary.  It is a free download and is really an abridged version rather than the normal “teaser”. It gives you the whole story, but doesn’t go into a massive level of detail or have any examples or case studies. If there is enough interest from the book summary we will go ahead and edit and publish the full book. So instead our process looks like this;

  1. research
  2. write 25 page book summary
  3. get reviewer feedback
  4. rewrite summary
  5. make available to readers
  6. get feedback and level of interest
  7. write full book
  8. publish.

We got the idea from a combination of the Lean Startup who advocate developing the minimum viable product (MVP) to gauge and test the market and also Teespring a t-shirt printing company who call it “crowdfunded customer apparel” who only print the t-shirts once the number of orders have reach an economic batch size.

What it means is that we don’t waste time if there is limited interest or if the book summary gives enough information and the full book is not necessary.

Is this the future of publishing? We think so, but let’s let the market decide.

The power of social media: good & evil

A simple mistake by a Sainsbury’s employee who put a poster aimed at employees, to encourage every shopper to spend an extra 50p, up in a store window would have been a local issue 5 years ago. Realising their mistake it would have been taken down and forgotten, with perhaps a little ribbing from colleagues and a dressing down from their supervisor. Not now. Social media amplifies everything. The good and the bad. The blunder was spread around the social universe with the hashtag on Twitter until it was picked up by a national newspaper, in this article,  which supercharged the social media force.

Here is the offending or offensive poster.

Sainsburys 50p

Literally genius or is it literacy genius?

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Students at a local school were assigned to read 2 books, ‘Titanic’ and ‘My Life’ by Bill Clinton. One student turned in the following book report, with the proposition that they were nearly identical stories! His professor gave him an A+ for this report.

Titanic: Cost – $29.99
Clinton : Cost – $29.99

Titanic: Over 3 hours to read
Clinton : Over 3 hours to read

Titanic: The story of Jack and Rose, their forbidden love, and subsequent catastrophe.
Clinton : The story of Bill and Monica, their forbidden love, and subsequent catastrophe.

Titanic: Jack is a starving artist.
Clinton : Bill is a bullshit artist.

Titanic: In one scene, Jack enjoys a good cigar.
Clinton : Ditto for Bill

Titanic: During the ordeal, Rose’s dress gets ruined.
Clinton : Ditto for Monica.

Titanic: Jack teaches Rose to spit.
Clinton : Let’s not go there.

Titanic: Rose gets to keep her jewellery.
Clinton : Monica is forced to return her gifts.

Titanic: Rose remembers Jack for the rest of her life.
Clinton : Clinton doesn’t remember anything.

Titanic: Rose goes down on a vessel full of seamen.
Clinton : Monica.. Ooh, let’s not go there, either.

Titanic: Jack surrenders to an icy death.
Clinton : Bill goes home to Hillary – basically the same thing

Unlocking the secrets of selling innovative solutions B2B

IMPACT: the technology executive’s guide for selling B2B disruptive and innovative solutions

Download the 20 page Book Summary

EXECUTIVE SUMMARY

It is getting easier to develop technology, and cheaper to deploy through the cloud, but it is not getting any easier to build and scale an innovative B2B technology company. At the outset innovative or disruptive technology is only purchased by an Early Adopter, to use Geoffrey Moore’s “Crossing the Chasm” terminology. The Early Adopter buying approach is the polar opposites to the Early Majority buyer. The Early Adopter is prepared to take a personal risk with innovative technology as they can see the huge potential. In contrast the Early Majority is the risk-averse buyer of technology in established markets to solve known, documented and measured needs; for example CRM, ERP, BI, secure mobility or collaboration. In fact, staggeringly 63% of all software revenue is split between Microsoft, SAP and Oracle – the market leaders – selling to the Early Majority.

Our 25 years of research has shown that every buyer follows a universal buying process, irrespective of industry, country or market. We have distilled this process into 6 steps; IMPACT. Idea, Mentor, Position, Assess, Case, Transaction.

What is interesting is when the customer invites the vendor into the process. The Early Adopter engages the vendor at Mentor when the solution is innovative, disruptive and shows potential that needs to be proven. The Early Majority does not invite the vendor until Case, when they already have a budget, business case, RFP and are ready to run a formal procurement process.

So, the different buying traits and the length and style of customer engagement means that selling to an Early Adopter requires a radically different approach to the shorter engagement with the Early Majority. However, unaware of IMPACT of the buyer types, most early stage companies replicate the sales techniques of the market leaders with disastrous results. They are selling to the Early Adopters, but using an approach honed to sell to the Early Majority.

But it is not just the sales teams that have to work differently. The entire company must be structured in a way to optimize sales to the particular buyer type. We are calling that the operational culture; the strategy, the structure, the behavior and expectations of the organization. This means different processes, incentives and KPIs. The Early Adopter needs a Value Created operational culture which has more thought leadership and is more consultative. The Early Majority needs a Value Added operational culture – the way that we see the market leaders operate – managing a sales funnel and winning RFPs.

Sadly most early stage companies, by default, are organized with a Value Added operational culture and are staffed with Value Added sales guys fresh out of SAP or Oracle. They are confused about why they are not closing deals and their tried and trusted sales funnel metrics are not working. And worse, they are frustrated that it is proving impossible to forecast close dates.

The purpose of this book is to enable you understand what is happening for your Early Adopter customer through the IMPACT cycle and how to engage with them so that it all makes sense and becomes repeatable.

To be able to survive and then thrive to the left of the chasm, selling to Early Adopters, early stage companies need to make a strategic shift and move to a Value Created operational culture.

Download the 20 page Book Summary

Q9 Group launches. The start of a new era or is that error?

Q9 logo and tag line

The summer is over. The flip flops and shorts have been swapped for business attire. I took the summer off to spend time with the family and that has proved to be one of my better decisions. But I also set myself the goal of by 1 Sept that I would decide what I would focus my energy on. I had 4 options:

  1. Another tech start-up
  2. An interim CEO role (adult supervision) for a tech start up
  3. A portfolio career of writing, speaking and non exec roles
  4. Launching a global consulting firm.

I chose door 4. Why?  I think it offers the right level of risk vs reward for me.  Plus, sitting here in San Francisco, close to Salesforce.com I can see  huge opportunity to help them with their largest clients where they are engaged in large change projects with complex implementations where the process driven approach we perfected at Nimbus will make a huge difference.  Finally, back in March I was program manager for a large TIBCO Nimbus project with a small team of 5  of us for 3 months at a client in Toronto. It was Q9′s first project and it took me back to my Accenture days. And I had forgotten how much fun and rewarding it was.

So the last 2 weeks I have been developing the brand, getting clear on the proposition, setting up the email, social sites and website.  The deadline was today.  And it is all done. So please go and check it out  www.q9group.com    All comments, both good and bad, are welcome.

Q9 logo and tag line

MISSION:  We help our clients change to be more successful

FOCUS: Customer Experience = Process + CRM (Salesforce.com)

 

 

Obviously if there are projects that you hear about, then please think of Q9.  If you are interested in working for Q9 then email me  igotts@q9group.com  In the early days it is a balancing act between winning projects and taking on staff. But the aim is to build a significant consulting business, headquartered out of San Francisco but delivering complex change projects for global clients.

I will continue to blog here as IanGotts on a range of subjects, but also Q9 will be blogging on process, sales and Customer Experience.  So please go and subscribe.

I am both excited and scared.  But that is how it should be – right?