By APNWLNS payday loans
December 7, 2010
 Cheap marketing research is like a cheap date:Â Sure, you have a transient and temporal moment of involvement, but nothing longer term ever comes from it and it can lead to nasty infections.
This comparison recently came to mind when a client asked if there was any way we could scale back a proposal for performing market research. As with most everything else, market research presents a tradeoff between cost and quality. The results from seeking inexpensive alternatives are the same. A discount paramour might deliver a life threatening disease and discount market research could deliver a fiscal death sentence.
Either way you get … well, let’s not go there.
Many miss three essentials about market research, namely qualitative breadth, quantitative depth, and statistical strength. If any of these three elements are missing, your market research will lead you astray. Hence, anyone attempting to understand their market needs to commit to researching the human factors of purchasing motivations, the degree to which each element concerns the entire market, and be sure that enough hands were counted to correctly model the market’s needs.
It is doable, but rarely is it cheap.
Qualitative research attempts to capture the wide variety of issues buyers and influencers have. Despite nearly seven million quarter inch drill bits being sold last year, nobody wanted a quarter inch drill bit: they wanted a quarter inch hole. They also wanted quarter inch holes in wood and ceramic and steel, a minimum of fracturing/splintering, a minimum number of sustainable RPMs, and a choice of colors (the pink drill bits were not big movers). Drill operators also wanted twist, tapers, extenders and left handed rotations. All these reflected the qualities (qualitative) nature of the users, their work and the varied essences of quarter inch holes.
Qualitative research typically involves talking to people until they are sick of talking to you. Deep interviews with a large handful of target buyer genotypes is a common approach. Even the smallest start-up performs accidental or ad hoc qualitative research — otherwise they would never have a single buyer (which seems to be the case with many start-ups).
Quantitative research mainly deals in how many people want one or another qualitative aspect, or how seriously they want it compared to other features. Since you cannot possibly deliver every possible feature to every possible buyer, you need to know which whole product features are in most demand and why. Members of the United Brotherhood of Carpenters showed a distinct lack of interest in pink drill bits, even in metric sizes.
Quantitative research almost always swings toward surveys, which creates two problems. First, there is a science to surveying — from survey instrument design, to question cross testing, to covariant analysis — it is a non-trivial activity. The other problem is that online survey tools became so popular so fast that email inboxes everywhere were instantly flooded with requests to participate in surveys. Thus, you have to bribe people to take serious surveys (American Idol text polling doesn’t count) and the longer the survey, the larger the bribe.
Which leads us directly to statistical validity. Attempting to perform research on the cheap typically causes an insufficient number of responses to be gathered to obtain a statistically strong measurement of a market. Granted, if there are huge divergences in smallish samples, the research may be valid (like when 99.998% of the members of the United Brotherhood of Carpenters said they would never buy a pink drill bit, and the one fellow who did was nail-gunned to a beam). Restricted response produce dicey decisions. Yet many businesses make million dollar mistakes based on substandard surveys.
With one exception, you need to bite the financial bullet and outsource market research. Your ultimate business decisions rest on the results. Using cheaply produced research to launch or grow your business is like using masonry bit to anchor crown molding — the results ain’t pretty.
The exception is for companies designing products in the ‘innovator’ phase of the technology adoption lifecycle. This earliest of moments in a product’s life cycle is like when Michelangelo first stuck a raw hunk of marble with a chisel. The process is about knocking of huge imperfections in order to see the basic shape of the art/product. Most of the direction comes from you and some very participative patrons. You conceptualized the core product idea because you had talked to enough potential users to see an opportunity. In the innovator phase you are building the core product, and expensive formalized research can wait … for a while.
November 30, 2010
 It hurts to be disliked. When a whole market thinks you stink on an ice floe, you have polar bear sized problems.
A client recently engaged Silicon Strategies because the market didn’t think much of the client. Though their software was considered ‘competent’, it was also thought of as based on the previous century’s technology and was not rapidly updated. Our client had a well deserved and growing reputation of holding onto former glory and not keeping up with new millennia mentalities. In short, the market had assigned them a negative brand.
For them, exhibiting at events was like walking into a singles bar and watching every woman in the joint walk out.
Our client faced this difficulty while preparing a new product which, at very least, brought them to par with competitors in important market segments. From experience we knew that merely introducing the product was not enough — the market was jaded and  new/improved products were not going to reverse their negative brand. The market’s attitude needed changing before it would even consider receiving messages about a bigger, better, modern version of the smaller, lesser, ancient product.
They needed more than a squirt of cologne to avoid going home alone.
Silicon Strategies Marketing has faced this problem before. One of our earliest clients was SuSE Linux, before the Novell acquisition, before the Attachmate acquisition, before the WordPerfect acquisition (that last one was a joke, so nobody in Nuremberg should go nuts). At that time Linux was rising rapidly, Red Hat owned all the North American mindshare, and the market considered SuSE a “quirky little German software company that makes a good Linux distro.” As part of a broad strategy to gain a equal footing with Red Hat, we advised SuSE to communicate to different audiences (CxOs) about their strategic thinking since Red Hat could not stop talking to techies about how cheap Linux was. This strategy snippet avoided communicating to one part of the market (techies) who held the negative brand opinion about SuSE and begin a dialogue with buyers who did not (at that time) have an opinion or brand preference. All in all it worked rather well.
But Silicon Strategies Marketing’s new client did not have the luxury of a nascent market, one with major buyer genotypes ready for first impressions. The entire market — from strategic decision makers to end users — needed to have their attitudes changed and thus accept that the new offering was worth consideration. Our client needed cologne, a new suit, shave, hair cut and a few months in the gym.
One important tactic is to first promote any company’s primary non-product strengths (other parts of the whole product mix), then their current product strengths. Doing so establishes in the markets mind that the company is alive and providing real value to real customers. Herein customer case studies and specific value propositions are convincing. All value propositions put forth should foremost be inarguable (Google is smart, politicians lie, Ozzy Osborn is insane, etc) and preferably ones that the market and buzz agents will echo easily and with conviction. For example, in the SuSE case study, we always spoke of the rock-solid structure SuSE’s software and how that drove large scale purchases in Europe.
Associated with this tactic is the need to make several small statements over time. If a company went to a skeptical market with one large, complicated story, and nothing was heard from them again for a long time, the concept of viability would never stick. Corrective PR looks less like a flood and more like water boarding. Reversing negative branding requires lining-up many points of positive gospel and preaching it over time.
When introducing a new or revised product, the same applies with a modification. The market can only accept the idea of radical change when the change is so vast that the old way/product/method/party is clearly and hopelessly outmoded (remember when WebCrawler owned the Internet search market — pre-Google). With anything less than that, you have to pick narrow target market segments, hit them hard with all the new features and value propositions first, then address the larger market with the introduction and a steady drip of relevant information (which could be PR, direct mail, social … anything). The prioritized segments will carry and amplify brand believability while the rest of the market warms-up to the idea that your company and products actually mean something.
The key marketing lesson is that negative branding is earned and reversing it requires steady effort, not a single massive assault. It is like the fellow who walks into a singles bar and proposes marriage to the first attractive woman he sees — an unexpected, hasty promotion will not work. Expect a long courtship and one where you have to be a better man at each step.
November 16, 2010
 Segmenting your market is like assembling a 1,000 piece jigsaw puzzle … where some of the pieces are missing, none fit together very well, and a few might even be from a different puzzle.
I was reminded of this madness thanks to two separate clients. One is in the energy trading risk management (ETRM) software space and the other is in language services. Very different industries, very different customer verticals, hugely different buyer genotypes, and many of the exact same segmentation difficulties. Their mutual difficulty was not in selecting relevant vectors on which to segment their markets, or divining the needs of any segment. The problem was the conflict between the theory of a segment and the reality. For example, one of these two clients had a subsegment that was largely untapped and, on paper, looked highly profitable. The reality was that most of this untapped segment contained companies that didn’t need my client’s product because of a fundamental difference in the way they did business from all the other segments.
Another client had the problem of too many subsegments. Even looking at the comparatively simple matrix created by industry verticals and regions, my client had 27 different primary segments. Deeper evaluations into each showed a myriad of variations, enough to keep their marketing intern busy until retirement.
Marketing people can squander copious quantities of money and time attending to too many segments, and for two reasons. First, many segments simply don’t matter. Take for example the client who had a segment populated by companies with odd business models. Once those odd ducks were eliminated, the remaining dollar value of that segment was near the bottom of the list and not worth direct promotions (casual or indirect promotions perhaps). Elimination of needless work segments should be high on any marketing managers to-do list, though it takes some guts to look at your CMO and say “We should not sell to this group.”
More importantly though is that marketing people tend to be a little too controlling. The Internet and cheap web hosting provides great ways to allow people to self-segment. Simple web forms that gently allow visitors to pigeonhole themselves are affordable to anyone, and used by very few. After all, you are going to ask these people to give you money, asking nicely for a little data isn’t going to detour them … much.
Occasionally you see ham-handed attempts to get people to file themselves into one or another classification. Often these implementation create such end-user friction that the prospect vanishes instead of helping you sell to them. Take for example any landing page that has a form, and in that form are either too many questions or some questions with too many options. People, being members of an over-worked and under-attentive species, will default values or abandon the page entirely.
Several keys exist to customer self-segmentation. First, keep your forms simple and short. Second, give visitors reason to interact again and ask for a little more information each time. Third, use a variety of landing pages and honey pot text to attract people from all your target segments. Forth, do a little cluster analysis to see if your theorized segmentation model is working or not (if you see visitors clustering in too few segments, than either your model is wrong, your keywords are incomplete, or some of those segments are losers).
The marketing lesson is to make computers and customers do more of your work. This allows for three martini lunches that making afternoon productivity optional.
November 9, 2010
The concepts of “free” and “sex” sell more products than all other promotional elements, and if you are offering free sex people will line-up at your door.
SaaS companies, among others, like “free” lead generation. Most SaaS providers give away a limited version of their offering to collect people’s contact info and build long-term connections to the product. Their grand scheme is always to up-sale freeloading bottom feeders into paid accounts. Yet most SaaS companies have no plan of action for up-selling.
 It’s a SaaS underpants gnome problem.
One of the problems is that online up-selling is a target moving faster than the one on Osama bin Laden’s back (we will get ya, boy). Rules that made sense when Marc Benioff first started pimping Salesforce.com do not apply today. There is no template, just a growing list of things to stop doing.
The most prevalent mistake made in up-selling is poor targeting. When you open your SaaS solution to everybody and their cat, many to most of your freemium customers will not fit any description of “qualified lead.” Most are individuals or small players with no elaborate needs and who are too cheap to buy some desktop software to do the same job. Spending time trying to up-sell them is a lost cause, and might irritate them to the point of becoming a vocal brand detractor. Thus, segmenting your freemium lead list, into the qualified and not, is an essential first step followed quickly by figuring out when an unqualified users changes status to qualified (and that subject will take too long to discuss in any tome shorter than War and Peace).
The next processes is nurturing both qualified and unqualified leads — and it should be blindingly obvious to a blind man that the processes must be different for these very different groups. The similarity in promoting to each group is demonstration of additional value possible through paid version of your SaaS system. The key difference is that the unqualified leads need to see practical how-to demonstrations for the free product, and to start getting material value from it before even considering an upgrade. Instead of hyping the benefits of the paid product, you need to spend your effort assuring they are getting the most from the free version until they are using it as a regular and indispensible part of their day.
Qualified leads likely use your product with rigor, and their usage can be profiled. For each feature, function and outcome, you have insight into what they can achieve by using more of the same, tangent features, or expanding to a larger pool of their employees. Lead nurturing qualified clients involves lighting a path from their current state of happiness to an advanced (and paid for) state of euphoria. But before you can light a path you have to locate the body — know what the qualified lead is doing and not doing.
One interesting and underused element of profiling SaaS users is comparing demographically similar companies who are paying and not. Let’s say you had ten grocery store chains who used a paid version of a SaaS application and another ten skulking about with the free edition. Let’s also assume that they are not radically different in size geography or customer base (for example, contrasting the software uses of Texas Tom’s Big Beef Outlet with Veronica Vegan’s Veggie Basket would be a horrendous mistake, especially after Tom catches and BBQ’s poor Veronica). Examining what features and functions paying customers use most often gives you the information necessary to know how non-paying customers could benefit from upgrading. Make promotions match the needs of freemium users (as demonstrated by non-freemium users) and you can not only make immediate and valuable sense to the prospect, but you can even supply statistical proof of how upgrading makes a prospect more competitive.
In all cases relevancy is primary. Sending an endless dribble of emails is an electronic Chinese water torture that produces the same degree of loyalty. Sending any stream of irrelevant materials is spam. Neither is welcome and when combined you get the typical SaaS up-sell campaign as practiced in the world today.
Phase 3, profit.
The marketing lesson herein is targeting with ample opportunity. The price paid by users for free SaaS is information. Not just contact info, but demographic info — data on which you can later profile your customers. SaaS is uniquely capable of acquiring this data because of the long-term rewards offered with free software. Be a little hungry, ask for meaningful data up front, and if necessary make adding to their demographic profile a requirement of continued free use. Then break out the BI tools and start segmenting, profiling and targeting.
And if anyone from Al Qaeda is using your SaaS software, send their contact info to the Marines.
November 2, 2010
“May I speak with Silicon?”
 Rarely am I stunned into silence. Just ask my ex-wife or my congress critter. Yet when I answered my phone in the middle of a rushed work day, and heard a clearly foreign voice on the other end asking for a person named Silicon, I was muted, torn between throwing a vitriolic fit of indignation or laughing aloud.
I eventually opted for the former.
After some ungentle queries on my part, it came to light that the cold caller was peddling web development services and was wondering if perhaps we might be in need of some. Further interrogation (which at this point had become a source of amusement … for me, not the caller) showed that she knew nothing of my company, or business, our web site, or even the color of the sky given the distinct possibility that her call center was a dungeon in the sixth ring of Hell.
Which is a good place for it.
In marketing there are three distinct forms of lead generation: push, pull and path. We learned the first two in management school and the last one is relatively new. In push campaigns, you assault the buyer by reaching out to them. Of all forms of push promotions, cold calling is both the least welcome and the least effective, for the very same reason. People need to learn about options when and where it makes sense for them. If a busy executive (me) is intently focused on reviewing a multi-phase go-to-market strategy plan, the best way to lose that executive’s business for life is to call him on the phone with some inane, untargeted, tangent irrelevancy.
This is why insurance salesmen got such a bad rap, because push selling is all they knew.
Even advertising, the most non-disruptive form of push promotion has sought less and less disruptive means of communication as the public become more immune to direct messaging. Product placement is big because decades of television viewership has mutated the human species and given them the ability to ignore most ads. One reason banner advertising is cheap is that it too has largely become ineffective.
Pull promotions are a bit different. The goal is to create desire and thus demand, and have products pulled by the customer. A great deal of buzz and viral marketing is executed to create pull, which has the advantage of affecting people who have a predisposition to acquiring a particular product. It also has the advantage of not tempting lousy marketing managers to set up phone banks with staff who ask to speak with Mr. Strategy.
However, the new kid on the block — facilitated by the Internet — is path marketing (a term I am happily hijacking from Seth Godin). The fact is that people need stuff all the time and will seek it out once they have some idea of their own needs. Just ask any middle aged man what he did when experiencing his first hemorrhoid (excluding his boss) and odds are they went on an Internet search of medical information and a remedy. The same applies to most any product, from cars to airplanes to printer paper. As Godin said, the goal is to light a path of discovery back to your product. This requires anticipating what words your prospects may use to describe their needs and expected outcomes, and generating enough of the right content that when they seek a solution, they find you.
For example, about half of our customers come from Internet searches, a sum that rivals referrals.
Herein is an interesting intersection that needs exploring. In many markets, but particularly in high tech, the prospect may not know their need or have the language to describe it. The glorious opportunity is to establish the language while lighting the optimized search path back to you. In other words, invent the core language that describes your solution, populate your web properties with those words, then use buzz and media to seed the market with the keywords you selected (and preferably copyrighted). Once Internet conversations start and use your keywords as the lingua franca, anyone who connects the concepts to their needs will automatically discover you and nobody else.
The marketing lessons are many. First, push marketing is still necessary, but is becoming less so (and there is a difference between push and pushy promotions). Second, search is the new lead tool for everybody. Last, you don’t need to compete in search — you just have to pollute the market with your proprietary language in a well ordered way.
And you can close your cold call centers — Mr. Silicon is no longer taking your calls.
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