OSS Marketing: How to make your product attractive

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OSS Marketing: How to make your product attractive

  1. 1. OSS MarketingHow to make your product attractive 1 U N I V E R S I T À D E G L I S T U D I D E L L’ I N S U B R I A D AV I D E T A I B I 19/06/12 OPEN SOURCE SUMMER SCHOOL 2012
  2. 2. Outline 2—  Introduction to Marketing ¡  Definitions ¡  MarketingStrategies ¡  New Product development ¡  New Product Adoption—  Open Source Software MarketingOpen Source Sumer School Davide Taibi 19/06/12
  3. 3. Introduction to Marketing 3Open Source Sumer School Davide Taibi 19/06/12
  4. 4. What Is Marketing? Simple definition: Marketing is the management process responsible for identifying, anticipating, and satisfying customer requirements profitably.” (CIM,2001) Goals: 1.  Attract new customers by promising superior value. 2.  Keep and grow current customers by delivering satisfaction.Open Source Sumer School Davide Taibi 4 19/06/12
  5. 5. Marketing Defined —  Marketing is the activity, set of instructions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. OLD view of NEW view of marketing: marketing: Making a sale Satisfying “telling and selling” customer needsOpen Source Sumer School Davide Taibi 5 19/06/12
  6. 6. The Marketing Process A simple model of the marketing process: —  Understand the marketplace and customer needs and wants. —  Design a customer-driven marketing strategy. —  Construct an integrated marketing program that delivers superior value. —  Build profitable relationships and create customer delight. —  Capture value from customers to create profits and customer quality.Open Source Sumer School Davide Taibi 6 19/06/12
  7. 7. Needs, Wants, and Demands Need: State of felt deprivation including physical, social, and individual needs. —  Physical needs: Food, clothing, shelter, safety —  Social needs: Belonging, affection —  Individual needs: Learning, knowledge, self-expression Want: Form that a human need takes, as shaped by culture and individual personality. —  Wants + Buying Power = DemandOpen Source Sumer School Davide Taibi 7 19/06/12
  8. 8. Need/ Want Fulfillment Needs & wants are fulfilled through a Marketing Offering: —  Products: ¡  Persons, places, organizations, information, ideas. —  Services: ¡  Activity or benefit offered for sale that is essentially intangible and does not result in ownership. —  Experiences: ¡  Consumers live the offering.Open Source Sumer School Davide Taibi 8 19/06/12
  9. 9. Customer Value and Satisfaction Dependent on the product’s perceived performance relative to a buyer’s expectations. Care must be taken when setting expectations: —  If performance is lower than expectations, satisfaction is low. —  If performance is higher than expectations, satisfaction is high. Customer satisfaction often leads to consumer loyalty. Some firms seek to DELIGHT customers by exceeding expectations.Open Source Sumer School Davide Taibi 9 19/06/12
  10. 10. Marketing Management The art and science of choosing target markets and building profitable relationships with them. —  Requires that consumers and the marketplace be fully understood. —  Aim is to find, attract, keep, and grow customers by creating, delivering, and communicating superior value.Open Source Sumer School Davide Taibi10 19/06/12
  11. 11. Marketing Management Marketing managers must consider the following, to ensure a successful marketing strategy: 1.  What customers will we serve? — What is our target market? 2.  How can we best serve these customers? — What is our value proposition?Open Source Sumer School Davide Taibi11 19/06/12
  12. 12. Choosing a Value Proposition The set of benefits or values a company promises to deliver to consumers to satisfy their needs. —  Value propositions dictate how firms will differentiate and position their brands in the marketplace.Open Source Sumer School Davide Taibi12 19/06/12
  13. 13. The Marketing Concept The marketing concept: —  A marketing management philosophy that holds that achieving organizational goals depends on knowing the needs and wants of target markets and delivering the desired satisfaction better than competitors.Open Source Sumer School Davide Taibi13 19/06/12
  14. 14. Customer Perceived Value Customer perceived value: ¡  “Customer’s evaluation of the difference between all of the benefits and all of the costs of a marketing offer relative to those of competing offers.” (Armstrong & Kotler) –  Perceptions may be subjective –  Consumers often do not objectively judge values and costs. Customer value = perceived benefits – perceived sacrifice.Open Source Sumer School Davide Taibi14 19/06/12
  15. 15. The Marketing Mix 15The set of controllable, tactical marketing tools that the firm blends to produce the response it wants in the target market.—  Product: Variety, features, brand name, quality, design, packaging, and services.—  Price: List price, discounts, allowances, payment period, and credit terms.—  Place: Distribution channels, coverage, logistics, locations, transportation, assortments, and inventory.—  Promotion: Advertising, sales promotion, public relations, and personal selling.Open Source Sumer School Davide Taibi 19/06/12
  16. 16. Introduction to Marketing 16 MARKETING STRATEGYOpen Source Sumer School Davide Taibi 19/06/12
  17. 17. Customer-Driven Marketing Strategy 17Requires careful customer analysis.To be successful, firms must engage in:—  Market segmentation—  Market targeting—  Differentiation—  PositioningOpen Source Sumer School Davide Taibi 19/06/12
  18. 18. Market Segmentation and Targeting 18Segmentation:—  The process of dividing a market into distinct groups of buyers with different needs, characteristics, or behavior who might require separate products of marketing programs.Targeting:—  Involves evaluating each market segment’s attractiveness and selecting one or more segments to enter.Open Source Sumer School Davide Taibi 19/06/12
  19. 19. Differentiation and Positioning 19Differentiation:—  Creating superior customer value by actually differentiating the market offering.Positioning:—  Arranging for a product to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target consumers.Open Source Sumer School Davide Taibi 19/06/12
  20. 20. Market Segmentation 20Key segmenting variables:—  Geographic—  Demographic—  Psychographic—  BehavioralDifferent segments desire different benefits from products.Best to use multivariable segmentation bases in order to identify smaller, better-defined target groups.Open Source Sumer School Davide Taibi 19/06/12
  21. 21. Market Segmentation 21Why Segment?:—  Meet consumer needs more precisely—  Increase profits—  Segment leadership—  Retain customers—  Focus marketing communicationsOpen Source Sumer School Davide Taibi 19/06/12
  22. 22. Evaluating Market Segments 22 Segment size and growth: —  Analyze current segment sales, growth rates, and expected profitability. Segment structural attractiveness: —  Consider competition, existence of substitute products, and the power of buyers and suppliers. Company objectives and resources: —  Examine company skills and resources needed to succeed in that segment. —  Offer superior value and gain advantages over competitors.Open Source Sumer School Davide Taibi 19/06/12
  23. 23. Market Targeting 23Market targeting involves:—  Evaluating marketing segments. ¡  Segment size, segment structural attractiveness, and company objectives and resources are considered.—  Selecting target market segments. ¡  Alternatives range from undifferentiated marketing to micromarketing.—  Being socially responsible.Open Source Sumer School Davide Taibi 19/06/12
  24. 24. Differentiation and Positioning 24A product’s position is:—  The way the product is defined by consumers on important attributes—the place the product occupies in consumers’ minds relative to competing products.—  Perceptual positioning maps can help define a brand’s position relative to competitors.Open Source Sumer School Davide Taibi 19/06/12
  25. 25. Differentiation and Positioning 25Identifying possible value differences and competitive advantages:—  Key to winning target customers is to understand their needs better than competitors do and to deliver more value.Competitive advantage:—  Extent to which a company can position itself as providing superior value. ¡  Achieved via differentiation.Open Source Sumer School Davide Taibi 19/06/12
  26. 26. Introduction to Marketing 26 NEW PRODUCT DEVELOPMENTOpen Source Sumer School Davide Taibi 19/06/12
  27. 27. Outline 27 —  New Product Design is a process which is designed to develop, test and considrer the viability of products which are new to the marketOpen Source Sumer School Davide Taibi 19/06/12
  28. 28. Charting new product development 28Open Source Sumer School Davide Taibi 19/06/12
  29. 29. What is a new Product 29—  A product that opens up an entirely new market—  A product that adapts or replace an existing product—  A product that significantly broadens the market for existing products—  An old product introduced to a new market—  An old product packaged in a different way—  An old product marketed in a different wayOpen Source Sumer School Davide Taibi 19/06/12
  30. 30. Stages in New Product Development 30—  Idea generation—  Idea screening—  Concept developement and testing—  Marketing Strategy—  Business analysis—  Test marketing—  CommercializationOpen Source Sumer School Davide Taibi 19/06/12
  31. 31. Stages in New Product DevelopmentIdea generation 31—  R&D department—  Production Department—  Sales Team—  Employees—  Customers—  Competitors—  External Sources—  Market ResearchOpen Source Sumer School Davide Taibi 19/06/12
  32. 32. Stages in New Product DevelopmentSreening ideas 32—  Drop poor ones as soon as possible—  Check ¡  Technical feasibility ¡  Financial feasibility ¡  Financial viability ¡  Marketability ¡  DemandOpen Source Sumer School Davide Taibi 19/06/12
  33. 33. Stages in New Product DevelopmentSreening ideas - Criteria 33—  Is there sufficient demand?—  Will be profitable?—  What is the lickely payback period?—  Does it fit the firm’s product portfolio?—  What is the likely life cycle of the product?—  What is the state of the market and competition?—  Does the firm possess the capabilities to successfully product and market the product?Open Source Sumer School Davide Taibi 19/06/12
  34. 34. Risks in NPD 34Open Source Sumer School Davide Taibi 19/06/12
  35. 35. Open Source Producers and NPD 35—  Corporate Distributions ¡  Industries ¡  SMEs—  Open Communities—  SponsoredOpen Source Sumer School Davide Taibi 19/06/12
  36. 36. Open Source Producers and NPD 36—  Corporate distributions ¡  Corporate driven development. ¡  New products developed on demand—  Open Communities ¡  Community driven development ¡  New product - ideas introduced by developers—  Sponsored ¡  New product – ideas driven by the sponsorOpen Source Sumer School Davide Taibi 19/06/12
  37. 37. Attention for Marketing and communication aspect 37—  Corporate distributions ¡  High attention, marketing and communication carried out as CSS—  Open Communities ¡  Low attention—  Sponsored ¡  Depend on the sponsorOpen Source Sumer School Davide Taibi 19/06/12
  38. 38. Introduction to Marketing 38 NEW PRODUCT ADOPTIONOpen Source Sumer School Davide Taibi 19/06/12
  39. 39. The model of adoption process 39—  Developed by Everett Rogers in 1962—  Concerns the spread of new innovative products trough the market—  The adoption of new product proceeds after certain thought processes—  The new product is adopted by different groups of people in sequenceOpen Source Sumer School Davide Taibi 19/06/12
  40. 40. New Innovative products 40—  Television – introduced in 1930—  Colour television in 1970s—  Video recorders in 1970s—  Multi-channel television in 1980s/90s—  DVDs in the 1990s—  Flat Screen television in the late 1990s—  High definition TV in the 2000sOpen Source Sumer School Davide Taibi 19/06/12
  41. 41. The adoption process 41 The mental process throuth which an individual passes from first hearing about an innovation to final adoption—  Knowledge/awareness—  Interest—  Evaluation—  Trial—  AdoptionOpen Source Sumer School Davide Taibi 19/06/12
  42. 42. The five step adoption process 42Awareness Aware of the product but lack detailed knowledgeInterest Curious – seek more informationEvaluation Deciding whether to test the productTrial Using the product on a test basisAdoption Deciding to become a regular userOpen Source Sumer School Davide Taibi 19/06/12
  43. 43. Adopters categories 43—  Innovators ¡  The first people to adopt a new product (2.5% of the market)—  Early Adopters ¡  People who choose new products carefully and are consulted by people in the subsequent categories (13.5%)—  Early majority ¡  People who adopt just prior the average person (34%)—  Laggards ¡  The last people to adopt a new product (16%)Open Source Sumer School Davide Taibi 19/06/12
  44. 44. 44Open Source Sumer School Davide Taibi 19/06/12
  45. 45. Innovators and early adopters importance 45—  The first two groups are crucial to the launch of a new product—  They are able to influence the next larger segments of the population—  The majority of the population will not adopt an innovative product until it has been take up by the first two groupsOpen Source Sumer School Davide Taibi 19/06/12
  46. 46. Open Source Adoption and Selection 46 NEW PRODUCT EVALUATIONOpen Source Sumer School Davide Taibi 19/06/12
  47. 47. Open Source Evaluation Models 47—  Product Evaluation ¡  OpenBQR ¡  OSMM ¡  OpenBRR ¡  QSOS—  Website Evaluation ¡  OP2AOpen Source Sumer School Davide Taibi 19/06/12
  48. 48. OP2A - Why a new assessment model 48—  The product evaluation models do not meet the quality requirements of users.—  Concentrate the attention on the portal—  People interested in evaluating OSS product are negatively impressed by web portals—  Other models do not take into account marketing aspectsOpen Source Sumer School Davide Taibi 19/06/12
  49. 49. Product  Evalua-on Portals vs Shopping Windows 49 Portal Failure Open Source Sumer School Davide Taibi 19/06/12
  50. 50. OP2A Model 50 Approach: 1.  Investigate user requirements for OSS selection ¢  Survey •  Goals and needs of different users 2.  Definition of model ¢  Model definition in terms of required informationOpen Source Sumer School Davide Taibi 19/06/12
  51. 51. The Survey 51 • Survey’s sections: • The roles of the involved individuals • The problem domains • The information analyzed during OSS selection 151 interviews collectedOpen Source Sumer School Davide Taibi 19/06/12
  52. 52. The Survey 52Open Source Sumer School Davide Taibi 19/06/12
  53. 53. Required information vs OSS role 53—  Different types of information are required by different types of users (or the roles played by users) ¡  Producer/developer ¡  Manager ¡  End User ¡  Customizer or value adder ¡  etc.—  OP2A assessment depends on roles Open Source Sumer School Davide Taibi 19/06/12
  54. 54. The Model 54—  OP2A = Open Source Product and Portal Assessment.—  The model is based on a checklist.—  The checklist is divided in 5 parts: ¡  Company information ¡  Portal information ¡  Reasons of certification ¡  Project Information Availability ¡  Usability Evaluation GuidelinesOpen Source Sumer School Davide Taibi 19/06/12
  55. 55. Required Information 55—  Information on ¡  Overview ¡  Requirements ¡  License ¡  Documentation ¡  Downloads ¡  Quality reports ¡  Community &SupportOpen Source Sumer School Davide Taibi 19/06/12
  56. 56. The Checklist 56Open Source Sumer School Davide Taibi 19/06/12
  57. 57. The Checklist 57Open Source Sumer School Davide Taibi 19/06/12
  58. 58. Assessment Levels 58Open Source Sumer School Davide Taibi 19/06/12
  59. 59. www.op2a.org 59Open Source Sumer School Davide Taibi 19/06/12
  60. 60. www.op2a.org 60Open Source Sumer School Davide Taibi 19/06/12
  61. 61. An Evaluation 61Open Source Sumer School Davide Taibi 19/06/12
  62. 62. OP2A 62—  OP2A model helps both end users and OSS producers—  More than 60 OSS projects analyzed—  OP2A open communityOpen Source Sumer School Davide Taibi 19/06/12
  63. 63. Open Source Marketing 63 MARKETING STRATEGYOpen Source Sumer School Davide Taibi 19/06/12
  64. 64. - Software unbundled from hardwareOpen Source Sumer School - Software packages - Trial Shareware - GNU projectDavide Taibi - Linux 64 - Software repositories Traditional Marketing - OpenOffice CSS Distribution and Marketing - LibreOffice Social Media Marketing19/06/12
  65. 65. How to make your product attractive 651.  Product Quality2.  Easy to use interface3.  Communication StrategiesOpen Source Sumer School Davide Taibi 19/06/12
  66. 66. Product quality 66—  A low quality product: ¡  can not survive on the market ¡  Can be introduced only if opens up an entirely new market ¡  Can not introduced to replace existing productOpen Source Sumer School Davide Taibi 19/06/12
  67. 67. Easy to use interface 67—  Usability, is a major issue—  Easy to use product are easily adopted by the users—  Easy to use product are adopted by a larger number of peopleOpen Source Sumer School Davide Taibi 19/06/12
  68. 68. Communication 68—  OSS projects often face with a low communication budget—  Communication strategies has to take into account different factors: ¡  Company/Community policies ¡  Budget ¡  Segmentation ¡  TargetingOpen Source Sumer School Davide Taibi 19/06/12
  69. 69. Word of mouth marketing 69—  People regard peers as the purest form of accurate informationOpen Source Sumer School Davide Taibi 19/06/12
  70. 70. Word of mouth marketing 70Open Source Sumer School Davide Taibi 19/06/12
  71. 71. Marketing to social networks 71 Stakeholders Individuals Organizations Communities Developers Companies OSS projects Designers Partners Scientists Bloggers Newbies Not-for-profits JournalistsOpen Source Sumer School Davide Taibi 19/06/12
  72. 72. Marketing to social networks 72Open Source Sumer School Davide Taibi 19/06/12
  73. 73. Open Source Marketing 73 Open Source marketing is about peer-to-peer, horizontal communication among multiple persons and groups with various rolesOpen Source Sumer School Davide Taibi 19/06/12
  74. 74. Marketing Strategy 74Open Source Sumer School Davide Taibi 19/06/12
  75. 75. The 4 Cs 75Open Source Sumer School Davide Taibi 19/06/12
  76. 76. 76Open Source Sumer School Davide Taibi 19/06/12
  77. 77. Positioning 77Open Source Sumer School Davide Taibi 19/06/12
  78. 78. Vendor Driven Ecosystem 78Open Source Sumer School Davide Taibi 19/06/12
  79. 79. Community Driven Ecosystem 79Open Source Sumer School Davide Taibi 19/06/12
  80. 80. Product Licensing 80Open Source Sumer School Davide Taibi 19/06/12
  81. 81. Strategy Elements 81Open Source Sumer School Davide Taibi 19/06/12
  82. 82. Marketing Plan 82Open Source Sumer School Davide Taibi 19/06/12
  83. 83. Plan Elements 83Open Source Sumer School Davide Taibi 19/06/12
  84. 84. Pieces of wisdom 84Be BOLDOpen Source Sumer School Davide Taibi 19/06/12
  85. 85. Piece of wisdom 85$ave MONEYOpen Source Sumer School Davide Taibi 19/06/12
  86. 86. Pieces of wisdom 86Do ITOpen Source Sumer School Davide Taibi 19/06/12
  87. 87. Pieces of wisdom 87be OPENOpen Source Sumer School Davide Taibi 19/06/12
  88. 88. A study on adopted communication models 88Open Source Sumer School Davide Taibi 19/06/12
  89. 89. The Case Study 89 Company Employees FLOSS role Engineering 6500 (CSS division) Engineering 50 Producer (OSS division) Integrator Studio QWERTY 12 Integrator Ubuntu (community) 400 Canonical Producer 542 CommunityOpen Source Sumer School Davide Taibi 19/06/12
  90. 90. The Case Study 90—  Semi-structured interview—  Different roles interviewed ¡  CEOs ¡  Marketing director ¡  Sales ManagerOpen Source Sumer School Davide Taibi 19/06/12
  91. 91. The interview 91—  Q1. Company information (#employees, revenue…)—  Q2. How do you come up with ideas for new product/ features?—  Q3. On what ground do you decide if develop product or not?—  Q4. How do you decide if a new product should be released with an OSS license?—  Q5. Which strategy do you take into account during the lifecycle of a new product or service?—  Q6. Which communication channels do you adopt?Open Source Sumer School Davide Taibi 19/06/12
  92. 92. Engineering (CSS division) 92How do you come up with ideas for new product/features?—  ENG is a customer integrator.—  Works only on job orderOn what ground do you decide if develop product ornot?—  ENG do not applies marketing research—  Only relies on customer’s feedbacksOpen Source Sumer School Davide Taibi 19/06/12
  93. 93. Engineering (CSS division) 93How do you decide if a new product should bereleased with an OSS license?—  ENG suggest its Business Units to adopt OSS in project already approved by the customers.—  BU are free to decide if adopt OSS or not.Which strategy do you take into account during thelifecycle of a new product or service?—  Development phase: silence.—  Once the product is ready: survey among customers to evaluate the appreciationOpen Source Sumer School Davide Taibi 19/06/12
  94. 94. Engineering (CSS division) 94Which communication channels do you adopt?—  Company website ¡  SEO—  Magazines only for Public Administration—  Conference and FairsOpen Source Sumer School Davide Taibi 19/06/12
  95. 95. Engineering (OSS division) 95How do you come up with ideas for new product/features?—  IT marketing monitoring—  Team Ideas—  Job orderOn what ground do you decide if develop product ornot?—  Only relies on customer’s feedbacksOpen Source Sumer School Davide Taibi 19/06/12
  96. 96. Engineering (CSS division) 96How do you decide if a new product should bereleased with an OSS license?—  OSS BU releases only 100% free/open source projectsWhich strategy do you take into account during thelifecycle of a new product or service?—  Development phase: pre announcements.—  Once the product is ready: survey among customers to evaluate the appreciationOpen Source Sumer School Davide Taibi 19/06/12
  97. 97. Engineering (CSS division) 97Which communication channels do you adopt?—  Company website ¡  SEO—  Every product has its own website—  Social Network ¡  LinkedIn ¡  Twitter ¡  Facebook no longer used—  Magazines only for Public Administration—  Conference and FairsOpen Source Sumer School Davide Taibi 19/06/12
  98. 98. Studio QWERTY 98How do you come up with ideas for new product/features?—  Team IdeasOn what ground do you decide if develop product ornot?—  Ideas are submitted to marketing agency to analyze market share.Open Source Sumer School Davide Taibi 19/06/12
  99. 99. Studio QWERTY 99How do you decide if a new product should bereleased with an OSS license?—  We always adopt FLOSS license (when applicable)Which strategy do you take into account during thelifecycle of a new product or service?—  Development phase: slience—  Once the product is ready: public eventOpen Source Sumer School Davide Taibi 19/06/12
  100. 100. Studio QWERTY 100Which communication channels do you adopt?—  We mostly delegate communication to comm. Agency ¡  Newsletters ¡  Conferences—  We avoid web banners—  Social Network ¡  LinkedIn ¡  No incomes from social network anymore—  Website ¡  SEOOpen Source Sumer School Davide Taibi 19/06/12
  101. 101. Ubuntu Community 101How do you come up with ideas for new product/features?—  The enphasis is on introducing features to improve market share—  Some features are developed by the users (eg. MyUnity)—  New features defined independently from team responsible for each component—  New features have to be approved by technical boardOn what ground do you decide if develop product or not?—  Ideas and features added to the roadmap based on Ubuntu project vision—  Within ubuntu ideas are assessed by Mark ShuttleworthOpen Source Sumer School Davide Taibi 19/06/12
  102. 102. Ubuntu Community 102How do you decide if a new product should bereleased with an OSS license?—  Ubuntu is released as 100%OSS.—  Canonical applies different licenses for some server side components.Which strategy do you take into account during thelifecycle of a new product or service?—  No specific strategies during lifecycle—  Events to present new features.Open Source Sumer School Davide Taibi 19/06/12
  103. 103. Ubuntu Community 103Which communication channels do you adopt?—  Website—  Social Media ¡  Twitter ¡  Facebook ¡  LinkedIn—  Online Magazines—  Press release—  EventsOpen Source Sumer School Davide Taibi 19/06/12
  104. 104. Comparison 104New Features ENG_CSS ENG_OSS QWERTY Ubuntu On request (job order) " " " " " Based on users needs " " " " " Based on teams ideas " " " " Team decision " Tested components developed by communityOpen Source Sumer School Davide Taibi 19/06/12
  105. 105. Q&A 105 davide.taibi@uninsubria.it This work is licensed under a Creative Commons Attribution-NonCommercial- ShareAlike 3.0 Unported LicenseOpen Source Sumer School Davide Taibi 19/06/12

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