Crossing The Chasm

Book by Geoffrey Moore on Marketing of high-tech products (or you could just consider it to be Business Strategy) - basically dealing with the Technology Adoption Life Cycle. Specifically, how to make your product, which is already accepted by Innovator and Early Adopter buyers, acceptable/attractive to the Pragmatist Consumer. ISBN:0060517123

Eric Sink's summary for SmallCo Software Industry players.

Some notes from Crossing The Chasm...

What Is A Market Segment?

• set of actual or potential customers
• for a given set of products or services
• who have a common set of needs or wants, and
• who reference each other when making buying decisions (there are at least 4 levels of this, in increasing value:)
  • sellable commonality: when you tell Prospect about currentClient, they don't immediately see them as comparable, but after discussion (and maybe actually talking to currentClient), they agree
  • already-evident commonality: Prospects recognizes the name of currentClient, immediately agrees that they are comparable
  • personally referencable: Prospect already has conversations with currentClient (at conferences, personal lunches, online conferences, etc.)

Why Segment Markets (Market Segmentation)? (and pick just 1 to target at a time - Focus)

• maximize benefit of resources... references, collateral, internal procedures and documentation (this is our biggest issue)
• higher Critical Mass of Word Of Mouth (because if your early successes are all in different markets then those different stories don't add together - see previous note about market consisting of buyers who reference each other)
• big fish in a small pond: halo effect of "being a winner" (this is more important in true Crossing The Chasm situations, where there is a real need for a Whole Product solution to be assembled from multiple vendors, and therefore the prospect wants to feel certain that you will have partners creating the supplemental pieces of the Whole Product)

Good section about writing User Scenarios (called "target customer characterization"; Alan Cooper has similar User Persona-s concept; also see Victor Lombardi's references ): p95.

• header/thumbnail description of buyer
• "before": day-in-the-life
  • scene/situation
  • desired outcome
  • attempted approach
  • interfering factors
  • economic consequences
• "after": day-in-the-life
  • new approach
  • enabling factors
  • economic rewards

Market Development Strategy Checklist: evaluate all the markets/User Scenarios you're considering targeting against this list of criteria. Outcome is to pick one as a beach-head.

• showstopper issues: low score on any of these eliminates a market from consideration
  • Target customer: single, identifiable economic buyer for the offer. Accessible to Sales Channel, and sufficiently funded to pay.
  • Compelling reason to buy: Are the economic consequences sufficient to mandate any reasonable economic buyer to fix the problems called out in the scenario? If pragmatists can live with the problem for another year, they will.
  • Whole Product: Can we field a complete solution to the target customer's compelling reason to buy?
  • Competition: Has this problem already been addressed by another company such that they have crossed the chasm ahead of us and occupied the space we would be targetting?
    • the market alternative is the company the target customer has been buying from for years - the old way of doing things
    • the product alternative is another discontinuous innovation trying to solve the same problem you are (to the interfering factors), but not as well-targeted to your Market Segment
• nice-to-have issues further filter the list of those who pass the 1st round
  • Partner and allies: Do we already have the relationships necessary to fulfill the whole product?
  • Distribution: Do we have a Sales Channel in place that can call on the target customer?
  • Pricing: Is the price of the Whole Product? consistent with the target customer's budget and the value gained by fixing the broken process? Do all the partners get compensated adequately to keep their attention and loyalty?
  • Our Positioning: Is the company credible as a provider of products and services to the target niche?
  • Next target customer: If we dominate this niche, does it have good "bowling pin" potential? That is, will these customers and partners faciliate our entry into adjacent niches? (Adjacent Possible)

The Positioning process (p152)

• the claim (Positioning Statement) (of indisputable market leadership within a given target Market Segment). Define for a product (this doesn't become your ad Tag-Line, but should control your ad message):
  • For ____ (target customers)
  • Who are dissatisfied with ___ (current market alternative),
  • Our product is a ___ (new product category)
  • That provides ___ (key problem-solving capability).
  • Unlike ___ (the product alternative),
  • We have assembled ___ (key Whole Product features to maximize fit for specific target Market Segment) (Product Market Fit)
• the evidence
• communications
• feedback and adjustment (iterations)