crossing the chasm - book review

Crossing the chasm�

Marketing and selling disruptive products to mainstream customers�

19.08.2013  

Carlos  Morales   Zurich  Lean  Startup  

Summary�

Technology Adoption life cycle Problem: The chasm Solution: Crossing the chasm!

Mission�

Customers attitude toward technology becomes significant in a marketing strategy. It gives clear guidance on how to address them.

Technology Adoption life cycle�

Different behaviors�

Innovators = Technology Enthusiasts

Early Adopters = Visionaries

Early Majority = Pragmatists

Late Majority = Conservatives

Laggards = Skeptics

Innovators – Technology Enthusiasts �●  Primary Motivation:

–  Learn about new technologies

●  Key Characteristics: –  Strong technical aptitude

–  Like to test new products

–  Can ignore any missing elements

–  Do like to help

–  Want no-profit pricing (preferably free)

Early Adopters – The Visionaries �●  Primary Motivation:

–  High motivated driven by a revolutionary breakthrough

●  Key Characteristics: –  Strategic thinkers, not from technology itself

–  Attracted by high-risk, high-reward propositions

–  Want rapid time-to-market

–  Demand high degree of customization and support

Early Majority – Pragmatists �●  Primary Motivation:

–  Gain incremental and predictable progress

●  Key Characteristics: –  Risk free, via evolutionary changes

–  Focus on proven applications

–  Insist on good references from trusted colleagues

–  Want to see the solution in production at the reference site

Late Majority – Conservatives �●  Primary Motivation:

–  Against discontinuous innovations

●  Key Characteristics: –  If it works, they stay

–  Risk averse

–  Highly reliant on a single, trusted advisor

–  Need assembled solutions

Laggards – Skeptics �●  Primary Motivation:

–  Maintain status-quo

●  Key Characteristics: –  Disbelieve productivity-improvement arguments

–  Seek to block purchases of new technology

–  Not a customer

Problem : The chasm �

Pragmatists don’t trust visionaries as references �

New & revolutionary

Unique functionality

Horizontal references

Willing to take risk

Want rich tech-support

Revolutionary processes

Tolerate bugs

Standard

Third party supporters

Vertical references

Little risk

Great quality of support

Enhance established processes

Bug free

Solution: Crossing the chasm! �

Analogy to an invasion �

To enter the mainstream market is an act of aggression. The companies who have already established relationships with your target customer will resent your intrusion and do everything they can to shut you out. The customers themselves will be suspicious of you as a new and untried player in their mar- ketplace. No one wants your presence. You are an invader.

Target the point of attack Assemble the invasion force Define the battle Launch the invasion

Target the point of attack�

Target a specific market niche as your point of attack and focus all your resources on achieving the dominant leadership position in that segment.

Segmentation!

Assemble the invasion force �

Create the whole product. This includes the core plus everything else you need to achieve your reason to buy.

Differentiation!

Define the battle �

The market-centric value system that must be the basis for the value of customers. What is your competition and how you differentiate.

Positioning!

Launch the invasion�

Distribution: select your distribution channel with which pragmatist is comfortable (direct sales is preferred)

Pricing: Set pricing at the market leader price point, reinforcing your claims to market leadership and build a high reward for the channel into the price margin.

Conclusions �

Market-driven instead of sales-driven�

The consequences of being sales-driven during the chasm period are, to put it simply, fatal.

The sole goal of the company during this stage must be to capture a reference base in a mainstream market.