Darwin lives!

In the list of overused marketing hype words, “ecosystem” is surpassed by few and only the classics like “robust”, “TCO”, and the ever popular “industry leading.”

The shame is that technology ecosystems do exist, are important, and can be key differentiators between competing products. The problem is that few technology marketers would recognize an ecosystem if it grew legs, walked out of the swamp, and beat them over the head. The folks at SalesForce.com do, and they are approaching the problem in the way it should — by letting evolution complete their ecosystem. “Ecosystem” and “whole product” are closely related subjects. A “whole product” is the combination of all elements involved in a buy decision — products, features, services, pricing, etc. Few companies take the time to map the ecosystem around the core product, and thus fail to dominate their markets by completely fulfilling customer wants and needs (Intel once did a great job in mapping their ecosystem, as evidenced in William Davidow’s “Marketing High Technology” ). An “ecosystem” is the conglomeration of products and service from different vendors that together make a “whole product”. Since no one company (not even Microsoft) can create all things for all people, each vendor needs to itemize the parts of their whole product, and find those symbiotic vendors to provide non-core components (and to their credit, Microsoft has always focused on the developer community which has been responsible for creating most of the unique solutions available for windows). The problem lies in mapping the entire range of features, functions, and benefits that any customer in your market may want or need. An entire ecosystem mapping is impossible because of the incredible minutia of individual needs, but also because any healthy market is changing too rapidly to map and adapt. Wise vendors will take a multi-phased approach to building out their ecosystem:

  1. Build the core product using the core capabilities of the organization.
  2. Build those associated products essential to the adoption of the core product (such as when Intel started making chips that allowed OEMs to more easily use Intel processors).
  3. Fund and anoint selected partners that provide important, but not critical features that compliment the core product.
  4. Fund the creation of a Darwinistic market that surrounds the primary product.

This last step is one often missed by even the largest and most sophisticated of vendors, and one that Saleforce.com is surprisingly early in delivering. Darwinistic marketplaces have all the advantages of a real ecosystem — near random experimentation with features and solutions (i.e., random genetic variations) that will thrive or die based on their value to the customer (i.e., their ability to compete for food and mates). Primary vendors who create these Darwinistic marketplaces — who cook-up a pot of primordial market soup — score big:

  1. Their whole product will be as complete as can possibly be, as small fish (with legs) try to fill every ecological niche.
  2. The primary vendor spends a comparatively small amount of money for this ecosystem.
  3. The primary vendor can buy any of these smaller companies that develop something truly useful.
  4. Customers will be attracted to the vendor with the most promising ecosystem.
  5. Competitors will find it harder to break new accounts.

Just remember — Darwin was right, and betting against him is always a mistake.


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