Routes to market

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  • 1. Routes to market David Jenkins Cambridge University Entrepreneurs; February 2011February 2011 Routes to market
  • 2. What’s the question?• How can we best extract value from our idea and/or invention?• What do we need to do to earn our first revenue?• How should we interface with our customers? – This is the question you get when you google ‘routes to market’• I’ll do my best to answer all three and use the value chain model to link themFebruary 2011 Routes to market
  • 3. How can we best extract value?• How far out do we go? – ie which commercialisation route should we chose• How far down do we go? – ie how much of the value chain do we want to capture?February 2011 Routes to market
  • 4. How far out do we go? (after Qi3; www.qi3.co.uk) Spinout/start-up • Establish a new company • Transfer to a licensee, with initial payments and Licence ongoing royalty • Work together on a joint project. Usually involves Collaborative R&D supply chain partnership Consultancy • Provide skills to enable knowledge transfer Secondment • Work within the company for a period of time Facilities Access • Use of facilities available in university by 3rd partyFebruary 2011 Routes to market
  • 5. How far down do we go? An introduction to the value chain discover develop deliver• This is the product end – Discover: your bit. What’s the big idea? Does it have value? Can I protect it? – Develop: can I turn my big idea into a product (or service) (more IP) for which people might pay? – Deliver: how can I produce/manufacture this product and/or resource the delivery of this service?February 2011 Routes to market
  • 6. How far down do we go? An introduction to the value chain sell supply service• This is the customer end – How can I persuade people to choose my product and/or service and buy it? – How do I get my product and/or service to the customers and collect his or her money? – What should I do to look after my customers after I’ve made the sale ?February 2011 Routes to market
  • 7. How far down do we go? An introduction to the value chain discover develop deliver market sell supply service• Marketing is the glue to hold it together: – Traditional marketing is product, price, promotion and position and there’s little wrong with that. • Product (and/or service): what exactly will my customers buy? • Price: what’s my product and/or service worth? • Promotion: how do I communicate? • Position: which sales channels will I be using?February 2011 Routes to market
  • 8. Marketing actually spans the length of the supply chain discover develop deliver market sell supply service inbound strategic tactical operational relationship marketing marketing marketing marketing marketing• It doesn’t matter how far down the supply chain you go you’ve still got to do some marketing• And doing it well, continuously and consistently, will build a brand … but only if your customers are supportive.February 2011 Routes to market
  • 9. This gives us a useful check list for what you’ve got to do discover • What’s by big idea? How do I protect it develop • How can I turn my idea into something which customers will buy? deliver • How can I produce/manufacture/build my product and/or resource my service? market • How can I build my brand? How can I attract customers etc sell • How can I persuade potential customers to buy? supply • How can I get my product and/or service to my customers service • How can I look after my customers once they’ve boughtFebruary 2011 Routes to market
  • 10. If you have decided to ‘spin out’ and go all the way to market• Then you need to decide how you will interface with your customers: – Remotely (typical web business); – Directly (own sales force); or – By proxy (use of 3rd party intermediaries)• And this decision needs to be taken for each of the final 3 value chain elements – Sell, supply and service• Whatever you decide: you’ve still got to manageFebruary 2011 Routes to market
  • 11. Your choices will be influenced by the nature of your business Web: route of • Obvious for software, low value items, BtoC choice for many • Challenges you to ‘drive’ customers to you today • High fixed cost, low variable cost Direct sales: • Best for high value and/or technical items challenge of • Lots of control but issues of fixed cost and roll managing people out Distribution: best • Low fixed costs and rapid roll out possible of both worlds? • But mega management challengeFebruary 2011 Routes to market
  • 12. Choosing your route to market is really a 2 hour workshop itself• If you really want to know more come along to the St John’s Innovation Centre, 8 Mar 11 at 11.00 (there’s a rather good free lunch)• For more info http://bit.ly/edvc6SFebruary 2011 Routes to market
  • 13. Thank you! David Jenkins; i2i-management.com helping smaller businesses to do wellFebruary 2011 Routes to market