Startup: are you well positioned?
Here are a couple of questions you might want to ask yourself along the way. It is not a full Business Model Canvas (http://en.wikipedia.org/wiki/Business_Model_Canvas) but may be useful too.
You want to hit as many greens as possible.
Increase revenue or save cost?
It is considerable easier to operate on the top part of the customer P&L-sheet than on the bottom. If your product promises to increase your customers revenues you have much more pricing flexibility and it’s easier to get discussions going with your prospects. When you sell savings the value proposition loses appeal and it’s more difficult to get budget for trying out your new product.
If you propose time savings time in the customer organization, it's good to remember that in practice people do not calculate value/price for their own work... Just a learning from real life. Maybe because it is difficult to imagine what else one could do with the additional time.
Customer: marketing/sales organization or administration?
This relates partially to the point above. It’s generally easier to sell to customer organizations that deal with marketing, sales, products or development than to pure support functions like sourcing, HR, finance & accounting and administration.
The organizations that do not have own revenue have very small cost budgets in addition to salaries. It's very easy to find 1 € for earning another 2€. But it's very difficult to find 1€ for saving 10€.
Use of product: compulsory or optional?
ERP systems, manufacturing systems or even accounting sw are different from many B-to-B solutions available in the internet. They will be the only systems of the kind in the customer organization and will go into automatic use. If your product is such that individuals can select to use it or leave it unused your penetration or take up rate is going to be slower.
Example: the company allows only one teleconferencing system to be used. Good for Cisco, Microsoft and the likes, bad for any other possible vendor.
Fits old ways of working vs learning required?
Gimme something new but not too new. A fantastic article on the matter is here. The Atlantic: http://theatln.tc/1w43Eec
You don’t really want to put yourself into the position that you should teach your customers something new. People will want to stick to their old habits. Great things happen if you manage to create emotional pull towards you product… not many examples come to mind in the B-to-B arena. But you can think about many Apple products, Whatsapp for kids, Nokia at it’s prime and so on. When you can create that kind of emotional tie people are willing to do anything to get your product and learn how to use it. Wouldn’t that be a great help in your product roll-out?
Think of a car salesman starting to use a CRM system 15 years ago... He probably has called you back yet.
Used often vs occasionally
If your product comes into use in the daily work it’s relatively easy to verify the benefits (e.g. CRM tool for a sales organization). If the tool is used seldom the stickiness factor is much smaller no matter how big benefits the occasional use might bring (e.g. travel management system for people that rarely travel).
So pay attention to this… how to get your product into everyday use. My favorite example is our finance system which is in shared use by our accountant and me: she is very handy with all the details (every day use) that I find next to impossible to use (occasional use). Or take WordPress… I’m an occasional user and probably not the only person that finds this a bit cumbersome.
Users' comfort zone vs outside comfort zone
Related to the learning new stuff. As we are dealing in a video application where the customers are expected to open the game by recording a first video themselves, we have learned a couple of things: many people do not feel comfortable (at first) in front of the webcam. And people are hesitant to go outside their comfort zone even if the benefits are obvious.
80% vs 20% efficiency increase
Any new way of working should have a big business impact. Marginal improvements will not catch attention in the crowded playing field of B-to-B internet services.
By Ari Beilinson
CEO at Recruitby.net, global internet sw, B-to-B, agile development proponent, business growth on all continents
Originally published on LinkedIn