Introduction to technology marketing

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Speaker: Jon Worren, MaRS Discovery District

In this session we look at the basic concepts and principles of marketing that are relevant for early stage start-ups. Jon uses real-life examples to illustrate some of the following:

* What is particular about marketing technology products?
* Understanding the language of marketing for start-ups
* Designing the marketing function in early stage companies
* Creating marketing plans for companies with scarce resources

Part of the MaRS CIBC Presents Entrepreneurship 101 lecture series.
http://www.marsdd.com/ent101

Published in: Business, Technology
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Introduction to technology marketing

  1. 1. Follow or Tweet: #ent101
  2. 2. Contents •  Goal: To Define Key Marketing Concepts •  Introduction –  Defining the field and scope •  Part I: Analytical Foundation •  Part II: Critical Value Factors •  Part III: Strategic Approach
  3. 3. Introduction DEFINING THE FIELD
  4. 4. Marketing - the definition •  Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders. Source: AMA
  5. 5. The Marketing Mix Product Price •  Variety, Quality, Design, •  List price, Discounts, Payment Warranty, Packaging, Brand Terms, Credit Name, Features 4Ps Promotion Place (Distribution) •  Advertising, Sales Promotion, •  Channels, Coverage, Locations, Sales Force, Direct Marketing, Assortments, Transportation, Public Relations Inventory
  6. 6. A Specialized Field Our Focus Marketing Technology Start-ups
  7. 7. Part I ANALYTICAL FOUNDATION
  8. 8. H1: Your Business Idea •  The name of your business/product idea? •  What kind of problem do you solve? Is this an important problem? Is there a big potential market? •  How is your competition solving this problem for their customers today? •  Why are you qualified to solve this problem better than your competitors? Is your uniqueness sustainable over time?
  9. 9. “The Chasm”
  10. 10. Are you Disruptive? Gain Twilight Zone Pain
  11. 11. The Analytical Foundation •  SWOT Analysis –  Internal: Strength, Weakness •  Attributes •  Capabilities •  Assets –  External: Opportunity, Threat •  PEST Analysis (Macro) •  Industry Analysis (Intermediate) •  Market Analysis (Micro)
  12. 12. Part II CRITICAL VALUE FACTORS
  13. 13. Target Customer Ideal 80% of Ideal 60% of Ideal
  14. 14. Customer Pain •  What problem are you solving for your customer? •  Is the customer aware of the problem or is it a latent problem? •  Market Analysis: Customer Needs •  C.Christensen: Job-to-be-done •  Avoid: Your reason to sell…..
  15. 15. Whole Product Potential Align with stage of Adoption Curve Expected Extended Core Product
  16. 16. Value Proposition
  17. 17. Part III STRATEGIC MARKET APPROACH
  18. 18. Competition •  There is always competition! •  Presence of choice is competition: –  Economic: Spend the money on other things •  Compete for product leadership –  Reference: Spend the money with competitor •  Compete through differentiation –  Inertia: Choose not to spend (biggest) •  Compete through FUD (or simply wait….)
  19. 19. BOS: The Art of Differentiation Source: Kim, W. C. & Mauborgne, R. (2005). Blue Ocean Strategy: How to Create Uncontested Market Space and Make the Competition Irrelevant.
  20. 20. Partnering & Distribution Partner Distributor •  Offers a part that •  Offers an avenue to complements Core customers Product •  Is determined by •  Implicit part of value complexity of solution proposition •  Cost and availability of •  Role of partners change channel important factors over time •  In some cases: distributor and partner is the same.
  21. 21. Partnering for Whole Product Solution Partner Potential Expected Extended Core Product
  22. 22. Distribution Model: Software
  23. 23. Pricing Principles •  Basis: Understand the value for your customer. –  Nature of Value: One-off or ongoing –  Will pay perceived value – not objective value •  Importance of Customer Relationship •  Critical for Positioning •  Avoid pricing complexity •  Be fair
  24. 24. Positioning •  Is in your customer’s mind •  What is the most attractive position to ‘own’? •  Reflects the sum of your Marketing Mix, but your marketing communication, price and physical attributes carry the most weight.
  25. 25. Positioning Statement •  For… (your target customer or market) •  Who… (the compelling reason to buy) •  Our product is a… (your placement within a new or existing category) •  That provides… (the key benefit that directly addresses your customer’s compelling reason to buy) •  Unlike… (the primary alternatives or competitors) •  We have assembled… (key difference or point of differentiation in relation to your specific target customer)
  26. 26. Example: TiVo
  27. 27. The TiVo Story •  Established 1997 •  Created the world's first digital video recorder (DVR) •  Potential to “kill” commercial TV •  Launch strategy: “Celebrity Evangelists” •  Revenue in Q3-07: $ 133M (peak) •  Revenue in Q2-09: $ 106M (down 20%) •  Stock price: $ 10.66 (All time high: $ 70)
  28. 28. TiVo: Customer Pain •  Time-shifting (need currently filled by VCR) •  Challenge: People don’t like VCRs because they don’t understand how to use them. •  Solution: Avoid positioning TiVo as alternative to VCR.
  29. 29. TiVo Positioning •  Original position: –  “TiVo is like having your own TV network where you get to decide what's on and when" •  Problem 1: “Personal TV Network” – customers have no familiarity with term •  Problem 2: Didn’t solve the customer pain •  Problem 3: Wrong type of evangelists •  Problem 4: The life cycle too short
  30. 30. Questions?

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