Marketing High Tech in Challenging Times - 9 Key Success Factors

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Marke;ng High Tech in Challenging Times – 9 Key Success Factors 

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Chasm Institute’s

Marketing High Tech in Challenging Times:
9 Key Success Factors
... an advanced webinar for high-tech marketing professionals in key software,
product, and web-based businesses, seeking to drive profitable sales in 2010.

3 priority questions to be addressed:

 how do customer needs change in different stages of the TALC (Technology Adoption Life Cycle) ?

 what are some key Best & Worst Practices for high-tech market success in tough times ?

 which 9 factors predict success or failure in new product launches ?
© 2010 Chasm Institute Contact: Michael Eckhardt meckhardt@chasminstitute.com
Update: 02/13/10
5
All rights reserved. Contents may not be reproduced in any form without prior written permission.

Chasm Institute’s Senior Workshop Leaders

Michael Eckhardt Mark Cavender
•  Managing Director, •  Managing Director,
Chasm Institute LLC Chasm Institute LLC
•  Senior Affiliate, •  Managing Director,
The Chasm Group, The Chasm Group,
1994 – 2003 1994 – 2003
•  e-mail: •  e-mail:
meckhardt@chasminstitute.com mcavender@chasminstitute.com

 Previous product management  Previous sales and marketing
and consulting experience experience in enterprise software
•  Hewlett-Packard •  Oracle Applications
•  PepsiCo Inc. •  JD Edwards
•  Harbridge Consulting •  McCormack & Dodge
•  Price Waterhouse & Co. •  The Service Bureau Company
 Education, workshops and  Education, workshops and
consulting engagements consulting engagements
•  Agilent Technologies •  Cognos
•  Cisco Systems •  FileNet, an IBM Company
•  Hewlett-Packard •  Lawson Software
•  Intel Corporation •  Nokia
•  Mentor Graphics •  Symbol Technologies
 MBA, Harvard Business School  MBA, University of North Texas

Update: 02/13/10
6

Chasm Institute’s


Priority Question #1:

 how do customer needs change in different stages of the TALC (Technology Adoption Life Cycle) ?

... and how does this impact marketing automation, lead nurturing, and database segmentation priorities ?
... plus: “why bad things happen to good marketing campaigns” – and how to avoid this.
Update: 02/13/10
7

High-Tech Markets develop in a relatively predictable pattern ...
... based on the changing behavior of customers

Pragmatists:
Stick with the herd !
Conservatives:
Status quo is OK -- move
Visionaries:
only when necessary!
Move ahead of the herd!
Skeptics:
No way!
Techies:
Try it!

Innovators
Early
Early Majority
Late Majority
Laggards
Adopters

Update: 02/13/10
8

How Do Customer Needs
Change Across the TALC ?

Innovators
Early  Early Majority
Late Majority
Laggards
Adopters

The Technology Adoption Life Cycle models market acceptance 
of both discontinuous and continuous innovations.

Update: 02/13/10
9

Innovators - Technology Enthusiasts

 Primary Motivation:
•  Learn about new technologies for their own sake
 Key Characteristics:
•  Strong aptitude for technical information
•  Like to alpha test new products
•  Can ignore the missing elements
•  Do whatever they can to help
 Challenges:
•  Want unrestricted access to top technical people
•  Want no-proﬁt pricing (preferably free)

Key Role: Gatekeeper to the Early Adopter

Update: 02/13/10
10

Early Adopters - The Visionaries

•  Gain dramatic competitive advantage via revolutionary
breakthrough
•  Great imaginations for strategic applications
•  Attracted by high-risk, high-reward propositions
•  Will commit to supply the missing elements
•  Perceive order-of-magnitude gains — not so price-sensitive
 Challenges:
•  Want rapid time-to-market
•  Demand high degree of customization and support

Key Role: Fund the development of the early market

Update: 02/13/10
11

Early Majority - Pragmatists
•  Gain sustainable productivity improvements via evolutionary
change
•  Astute managers of mission-critical applications
•  Understand real-world issues and trade-offs
•  Focus on proven applications
•  Like to go with the market leader
 Challenges:
•  Insist on good references from trusted colleagues
•  Want to see the solution fully deployed at the reference site

Key Role: Selective defender of the status quo

Update: 02/13/10
12

Late Majority - Conservatives

•  Avoid competitive disadvantage
•  Better with people than technology
•  Risk averse, disruptions unacceptable
•  Price-sensitive
•  Often highly reliant on a single, trusted advisor
 Challenges:
•  Need completely pre-assembled solutions
•  Would beneﬁt from value-added services  
but may often not want to pay for them

Key Role: Extend product life cycles

Update: 02/13/10
13

Laggards - Skeptics
•  Maintain status quo
•  Disbelieve marketing hype
•  Disbelieve productivity-improvement arguments
•  Believe in the law of unintended consequences
•  Enjoy taking a contrarian position
•  Seek to block purchases of new technology
 Challenges:
•  Not a customer
•  Can be formidable opposition to early adoption

Key Role: Retard the development of high-tech markets

Update: 02/13/10
14

High-Tech Markets develop in a relatively predictable pattern ...
... based on the changing behavior of customers

Pragmatists:
Stick with the herd !
Conservatives:
Status quo is OK -- move
Visionaries:
only when necessary!
Move ahead of the herd!
Skeptics:
No way!
Techies:
Try it!

Innovators
Early
Early Majority
Late Majority
Laggards
Adopters

Pragmatists are crucial to the adoption of new technologies -- they cast the deciding vote.

Update: 02/13/10
15

Chasm Institute’s



 what are some key “Best & Worst” Practices for high-tech market success in tough times ?

... and how can “pattern recognition” drive marketing success ?
... plus: winning practices from Tech 100 Leaders.
Update: 02/13/10
16

What are some “Best & Worst” Practices for
high-tech market success in tough times ?
... and how can the TALC 2.0 Model be a predictive marketing framework
for your 2010-2011 customer initiatives and go-to-market priorities ?

4. Tornado
5. Main Street
Thriving
Market
Maturing
1. Early  Market
Declining
Market
5-A
Market
5-B
5-C
2. 
Chasm
3. Bowling 
Alley

Update: 02/13/10
17

The Technology Adoption Life Cycle (TALC 2.0)

TALC 2.0 Model ... a tool for predicting how
high-tech market priorities (including target marketing,
feature decisions, messaging, channel, pricing, and # of SKU’s)
must change ---- from Early Market through Main Street.

4. Tornado
5. Main Street
Thriving
Market
Maturing
1. Early  Market
Declining
Market
5-A
Market
5-B
5-C
2. 
Chasm
3. Bowling 
Alley
Update: 02/13/10
18

Technology Adoption Life Cycle
(TALC 2.0) EXECUTIVE OVERVIEW

1. Early 
Market

2. 
Chasm

1. Early Market: Customers are visionaries under the inﬂuence of  
technology enthusiasts. Each new deal is greeted with enthusiasm. Product  
is still immature. Whole product has to be built from scratch for each customer,
including a signiﬁcant amount of “special work” unique to that customerʼs
requirements. Looks more like a project than a product.
[ Key: watch out for tops-down forecasts that are unattainable ]

2. The Chasm: Early market commitments now absorb all discretionary
resources such that you cannot offer any more “specials” to visionaries.
Pragmatists, however, do not see the relevant references nor the evidence  
of a whole product that would make the new category a safe buy. Sales cycles  
are extended, and most that do close are for pilot projects.
[ Key: “100% Whole Product” is crucial to a successful Chasm Crossing ]

Update: 02/13/10
19

Crossing the Chasm
The “Beachhead” segment

  The Problem:
•  80% of many solutions — 100% of none
•  Pragmatists won't buy 80% solutions
  Most frequent vendor mistake:
•  Working on the most common overall enhancement requests
•  Never finishing any one segment's requirements
  The Correct Solution (leading to success):
•  Focus on a single beachhead segment
•  Accelerate formation of that segment's 100% whole product
•  Pick a list of requirements for a specific segment – and finish it !

Dominating a market begins with dominating a segment. 
Examples: Google, Cisco, HP LaserJets, Apple iPods, Facebook

Update: 02/13/10
20

4. Tornado

3. Bowling 
Alley

3. Bowling Alley: Product is endorsed by pragmatist customers  
within the confines of one or more segments. Sales cycles within these
segments are predictable with good margins. Outside of these segments,
there are only opportunistic sales, often at significant discount.
[ Key: broad sales motions will fail ] 

4. Tornado: The majority marketplace has taken off. Virtually any  
vendor who can supply this category of product can sell it. A fierce  
market share war has developed, and price discounting is vicious.  
A market leader has emerged, establishing the de facto standards,  
and this company gets much better margins than the competition.
[ Key: duration of Tornado is typically only 2-4 years ]

Update: 02/13/10
21

5. Main Street
Thriving
Market
Maturing Declining
5-A
Market
Market
5-B
5-C

5. Main Street: The hyper-growth era is over. Market growth slows down
as the market saturates, but opportunity remains robust in both Thriving (5-A) or
Maturing (5-B). To expand further some competitors  
are now modifying their “standard offerings” to appeal to special segments  
via +1 Offers. Other competitors compete on price alone. The market leader still
gets a margin premium but is under pressure to reduce price.
[ Key: offer both safe Standard Solutions and smart, margin-rich +1’s ... while rationalizing SKU’s ]

Note re: 5-C  as Main Street moves beyond the stages of “5-A” and “5-B” and into “5-C”  
(Declining Market), this category of product is now fully saturated in the  
marketplace. This category may still ﬁnd loyal conservative customers  
within speciﬁc segments on Main Street, but the category will eventually  
pass out of the market from the perspective of the broad set of customers.  
It may be displaced by a newer category in the future.
[ Key: at this stage (5-C) pricing decision is crucial ] 

Update: 02/13/10
22

Chasm Institute’s



 which 9 key factors predict success or failure in new product launches ?
1. Target Customer
2. Compelling Reason to Buy
3. Whole Product
4. Partners & Allies
5. Distribution
6. Pricing
7. Competition
8. Positioning
9. Next Target

Update: 02/13/10
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... and why are the 4 P’s “necessary but not sufficient” when marketing high-tech products or services ?

... plus: whom to target -- in automated lead nurturing + database segmentation -- is just as key as what to say.

The 9-Point Market Strategy Checklist

Focal point for everything
1.
Target Customer

2.
Compelling Reason to Buy
Key market driver
To fulﬁll the compelling 
3.
Whole Product
reason to buy
4.
Solution Partners
Needed for whole
product
Willing and able to deliver
5.
Distribution / Channel
the whole product
Whole product price consistent
with customerʼs reason to buy,
6.
Pricing
margins consistent with partnerʼs
contribution
For the customer's money
7.
Competition
Relative to
8.
Positioning / Messaging
competition
Next move
9.
Next Target

This template holds for all stages in the Life Cycle.

Update: 02/13/10
24

9-Point Market Strategy: Attack Plan

1.
Target Customer

2.
Compelling Reason to Switch
Key market driver
3.
Whole Product
reason to buy
Needed for whole
4.
Solution Partners
product
the whole product
5.
6.
Pricing
contribution
7.
Competition
Relative to
8.
Positioning: “Why Switch?”
competition
Next move
9.
Next Target

The Attack 9-Point Strategy seeks to dominate new segments

Update: 02/13/10
25

9-Point Market Strategy: Defend / Expand

1.
Target Customer

2.
Compelling Reason to Stay
Key market driver
3.
Whole Product
reason to buy
4.
Solution Partners
Needed for whole
product
5.
the whole product
6.
Pricing
contribution
7.
Competition
Relative to
8.
Positioning: “Why Stay/Add ?”
competition
Next move
9.
Next Target

The Defend / Expand 9-Point Strategy seeks to gain loyalty & repurchase from our current segments

Update: 02/13/10
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Goal of 9-Point
Market Strategy Summary:

 A well-written 10 page summary document ...  
1 executive overview page + 9 detailed pages that tells:
•  your product group
•  your management team
•  key external (and internal!) partners
•  key Sales and Support
… your market development strategy for a  
speciﬁc product, service or initiative.

Update: 02/13/10
27

OUR 9-POINT PLAN Customer Initiative or Solution: MarketPro web service solution for
FOR MARKET SUCCESS installed-base OMB customers in U.S.
Executive Overview TALC Stage: ____Bowling Alley____ [ ] Early [ X ] Mid [ ] Late
Time Period for this Plan: from Q1FY10 to Q4FY10

Business Objective for this Plan: Drive high-value pages for OMB brochures & flyers in FY10
MarketPro targets businesses of X to Y employees in the U.S. “Iʼm a shop owner, not a marketer” sums up challenges these businesses
have finding the time + in-house expertise to create compelling marketing materials. Solutions like MarketPro are needed to help them
1 Target Customer
differentiate their business, while saving time + money. MarketPro would improve on the relatively weak set of choices these customers have
today.

Compelling Reason to Small business customers are tight on time, have very limited budgets, but a strong desire to look more professional. MarketPro helps them to
2 Buy affordably create + print marketing materials (brochures, business cards, flyers) via easy-to-use on-line choices that give their company a
great, professional look.

An MVP (minimum viable product) that provides this customer experience  an easy + affordable way to create professional brochures,
3 Whole Product
business cards, flyers + other marketing matʼls -- and print them how and when they want.

MarketPro is well aligned with internal + external partners -- HP Audio, Dunder-Mifflin, Tykor, and Stanton have the right skills and
Solution Partners
 

4
capabilities, share an understanding of our target customer, and have a track record of meeting commitments.

(1) HP internal partners (SPG, LSG, Web, regions) are motivated to distribute MarketPro, but they need to be educated & equipped to
integrate MarketPro into their HP programs. HP internal partners are still confused as to how the MarketPro brand has evolved over the past
5 Distribution year and the difference between WK/MP. Additional challenge: each internal HP partner has different OMB strategies, rules of engagement,
requirements, & timing relative to Interlock objectives.
(2) MarketPro.com

Higher-margin pricing for Print-to-Desktop and Print-to-Store (due to Bowling Alley lower price elasticity)
6 Pricing
Moderate-margin pricing (vs. InstaPrint) for Print-to-Mail (due to Tornado higher price elasticity)

7 Competition 2 Dangerous Competitors = “Status Quo” + InstaPrint (also: HP BizPro is a potential distraction for customers)

“For small businesses in the US (X to Y employees) who are tight on time + money, but want to look more professional, MarketPro is a web
Positioning / service that provides an easy + affordable way to create professional brochures, business cards, flyers and other marketing materials -- and
8
Messaging print them how and when they want. Unlike other alternatives which are too expensive, offer limited choice, or do not produce unique/
professional results, MarketPro will enable these businesses to proudly stand out and compete.”

9 Next Target FYXX – expansion into Northern Europe, GRAPHITE release, new hardcopy customers, differentiation at PDS

Update: 02/13/10
28

Suggested “Homework”
 Where are your priority products or
initiatives competing on the TALC
-- in key geographies in mid 2010 ?

?
?
?

5. Main Street
? Thriving
Market Maturing
Market Declining
5-A Market
? 5-B
? ? 5-C
?

Once we’ve gained accurate answers to the above question,  
we can then move ahead with confidence and clarity:
(1) about what we should and should not do in the market
(2) based on the specific TALC Stages we are competing in.

Update: 02/13/10
29

Pulling It All Together
What related Chasm Institute Workshops are available ?

Note: Many marketing professionals ask us how
to gain the real insights + tools needed to win
in Chasm-Crossing, Bowling Alley, Tornado
Thriving
or Main Street life cycle stages. Market
Maturing
Declining
Market
Market
The following 2-day on-site workshops
are tailored to your specific business:

Market Strategy Workshops (on-site) Focus:

 Crossing the Chasm (commercializing innovative new technologies and products)
 Bowling Alley Success (dominating key markets and market segments)
 Inside the Tornado (maximizing profitable revenue in high-growth / hyper-growth markets)
 Winning on Main Street (thriving in slower growth / margin pressure / mature markets)

... as well as the next level in marketing workshops – including:
our “Advanced Marcom” Workshop and “Advanced Go-to-Market” Workshop.

For more information:
on the above-mentioned tailored skill-building workshops for your team or specific business,
contact Angela Martinez at 650-537-6742 or martinez@everestag.com.

Update: 02/13/10
30

Why Chasm Institute ?
“No matter how great the strategy is, it means nothing
unless it is implemented.” - Geoffrey Moore

•  Chasm Institute programs are based on the industry standard in high-
tech strategy, coupled with real world experience
•  Geoffrey Mooreʼs best-selling business books
•  Strategy concepts that have been proven and reﬁned through hundreds of
real world consulting engagements by The Chasm Group over 12 years 

•  Ability to accommodate all of a companyʼs offerings
•  Multiple categories
•  Multiple places in the Technology Adoption Life Cycle 

•  Executives can choose between a blend of both workshops and online
education 
•  Chasm Institute programs help companies:
•  Achieve alignment across the organization
•  Gain alignment with business partners
•  Improve employee and partner motivation 

•  The result: Better deﬁnition and execution of your company strategy

Update: 02/13/10
31

Thank You
 Chasm Institute provides Chasm Institute LLC
education and professional 900 Cherry Avenue
development programs in Suite 221
market development strategy
for technology companies. San Bruno, CA 94066

 Work is based on best-selling
business books by Geoffrey Michael Eckhardt
Moore including Crossing the meckhardt@chasminstitute.com
Chasm and Inside the Tornado
plus The Chasm Companion by
Paul Wiefels. Mark Cavender
mcavender@chasminstitute.com

Update: 02/13/10
32

Copyright Notice

•  Copyright ©2010, Chasm Institute LLC. All rights reserved.
•  This presentation is provided to you solely for informational
purposes and does not constitute conveyance of any intellectual
property rights.
•  Chasm Institute LLC has created materials, methodologies and
practices that are proprietary. All intellectual property associated
with these works and any derivative works that come as a result
of any Client engagement shall remain the property of Chasm
Institute LLC.
•  This presentation may not be reproduced or redistributed, in
whole or in part, without the prior consent of Chasm Institute LLC.

Update: 02/13/10
33

Update: 02/13/10
34

IT IS A REALLY COMPLICATED PROBLEM

ng   Trade Shows 
Marke;
ROI 

PR  Partn
SEO  ers 
Demo 

sing  Order
Adver;  
Social Media  Blogs 

Proposal  Contract 

Webinars  White Papers 
Direct Mail 
Telema
rke;ng 
Sales 
Presenta;ons 
Pricing 

Customer 

B2B Selling relies on providing an informa;on 
conversa;on

B2B BUYING LIFECYCLE

Awareness Qualification Validation Conversion

MARKETING AUTOMATION IN A NUTSHELL

ORCHESTRATE RIGHT TIME RIGHT MESSAGE

Today’s Agenda 
•  About Jigsaw  Mitch Knight
•  Database Segmenta;on  Director of Business
•  Why ‘Clean’ Data Macers  Development
Jigsaw

 Founded in 2003.  

 World’s largest and most complete source of B2B 
company and contact informa;on.   

 Over 95% of Fortune 500 Companies use Jigsaw 

 9th fastest growing private company in the Bay Area* 
     *‐San Francisco Business Times

Marke6ng Budgets – How Are We Spending Those Marke6ng 
Dollars Today?   

Changes in Budget – 2009 
•  Catalog – Down 14.8% 
•  Direct Mail – Down 28.6% 
•  Email – Up 43.2% 
•  Internet Marke;ng – Up 62.9% 

DMA Research - 2009 Response Rate
Report

The Sales Side – How are Best‐In‐Class Companies Enabling Sales? 

•  Customized Messaging: The beneﬁts of 
knowing exactly who a salesperson’s 
target individual is. 

•  Incorporated Sales Intelligence Sources: 
Top‐performing sales teams are realizing 
the poten;al of directly feeding sales 
intelligence into the daily selling tool 
systems (CRM/SFA). 

•  Marke6ng Automa6on: Allows sales 
teams to be more eﬃcient. 

Aberdeen Research - 2009 Sales
Enablement Report

What’s The Impact? 
No Title:  
–  Inability to determine the what role is occupied by the prospect and deliver a truly 
customized message via phone, email, or direct mail campaign = Lower lead conversion 
rates. 

No Email Address or Phone Number: 
–  More ;me spent trying to reach key decision makers = Longer sales cycle, Slower Win/
Loss Rate 

No Revenue or Company Size Informa6on: 
–  Inability to accurately segment prospects results in more ;me spent with less promising 
prospects = Longer sales cycle, Slower Win/Loss rate, Lower average deal size. 

Bad Data: 
–  Bad data……

Key Takeaways 

•  With consistent adop;on 
capabili;es and enablers Best‐
In‐Class users are able to 
achieve measurable results. 

•  Whether the metrics are; 
–  Financial (Revenue; Deal Size) 
Or 
–  Ac6vity Oriented (Conversion & 
Win/Loss; Sales Cycle) 

•  This group is realizing considerable 
value.

Marketing High Tech in Challenging Times - 9 Key Success Factors

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