Crossing the Chasmvs.

Spinning Up the Web

Berkeley >PlayOctober 29, 2011

Venture Agenda: High-Tech Market Development Models

B-2-B Markets– Crossing the Chasm

B-2-C Markets– Spinning up the Web

Comparing Critical Success Factors– Chasm vs. Web

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Crossing the ChasmB-2-B High-Tech Market Development

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Pragmatists’ view of whole product maturity drives the adoption of new technology.

Innovators EarlyAdopters

Early Majority Late Majority Laggards

Techies:Try it!

Pragmatists:Use it when it’s ready!

Conservatives:Make sure it’s ready!

Skeptics:Never happen!

Visionaries:Be the first mover!

Technology Adoption Life Cycle

Minimum set of products and servicesto fulfill target customer's reason to buy.

CoreOffering

Hardware

SoftwareApplicationEngineering

Peripherals

Design

Installationand support

Databases

Outsourcing

ComplementaryProducts

ComplementaryServices

The Whole Product

Chasm

Tornado

BowlingAlley

Main Street

EarlyMarket

Market Development ModelOffers Evolve with Whole Product Maturity

Custom projects forVisionaries

Segment-specific solutions for

pragmatists in pain

Standard products forpragmatists with budgets

Proven systems for cost-conscious conservatives

1. Target Customer

2. Compelling Reason to Buy

3. Whole Product

4. Partners and Allies

5. Sales Channel

6. Pricing

7. Competition

8. Positioning

9. Next Target

Pragmatist in Pain

Complete solution

Can manage complexity

Current alternatives

Next growth segment

Broken m/c process

Ready to fill in the gaps

Rewards for all parties

Differentiating focus

Crossing the Chasm FrameworkA Playbook for B-2-B Market Development

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And that’s how you grow a B-2-B market!

Spinning up the WebB-2-C Digital Market Development

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Engagers create the dynamics of digital market development

Innovators EarlyAdopters

Early Majority Late Majority Laggards

Enthusiasts:Be 1st to try it!

Engagers:Check it out!

Reluctants:Wait!

Rejecters:Beware!

Evangelists:Believe in it!

Identity Modification Life Cycle

Brand/Identity Interactions*Levels of Engagement & Commitment

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A

B

C

D

I respect what you do, and believe what you say.

You are part of what I am. By choosing you, I express myself.

You express my dreams, and I want to do more to help your cause.

I never imagined this was possible. You are reshaping my identity.

* Model developed in collaboration with Schireson Associates

I select your offers over others whenever they are available.

I not only purchase your offers but display them proudly.

I will go the extra mile to play a part in your world.

I will camp out all night to be first in line when you open.

Level of EngagementLevel of Commitment

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VIRALITY ACQUISITION

ENGAGEMENTMONETIZATION

StarterMotor

Spinning Up Volume Operations on the WebRunning Experiments in Tandem

Spinning Up the WebMetrics that Will Drive Your Programs

Grow Acquisition– Rate of gaining new users (velocity & acceleration)

Grow Engagement– Average length, depth, and frequency of user engagement

Grow Virality– # of new customers coming from existing customers over time

Grow Monetization– Percentage & amount of participation, plus rate of change

Increase Promotional Productivity– Yield relative to acquisition, engagement, virality, monetization

Reduce Churn– Rate of losing existing users (velocity & acceleration)

Increase Lifetime Customer Value– DCF value to date, plus rate of change

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And that’s how you grow a B-2-C market!

Critical Success FactorsCrossing the Chasm vs. Spinning up the Web

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Critical Success FactorsWhat Venture Investors Look For

Disruptive technology

Compelling reason to buy

Customer domain expertise

Whole product focus

Agile services-led offer development

Distinctive cool factor

Leveraged access to market

Web-tech expertise

User experience focus

Agile data-driven product development

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Crossing the Chasm Spinning Up the Web

Different horses, different riders—same trail!

gmoore@mdv.com

#crossingthechasm

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Thank You