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word of mouth to develop in any particular marketplace, there must be a critical mass of informed individuals who meet from time to time and, in exchanging views, reinforce the product’s or the company’s positioning. That’s how word of mouth spreads.
Pragmatist customers want to buy from market leaders.
and we do, since we know pragmatists tend to buy from market leaders, and our number-one marketing goal is to achieve a pragmatist installed base that can be referenced—the only right strategy is to take a “big fish, small pond” approach.
The second key is to have lined up other market segments into which you can leverage your initial niche solution. This allows you to reframe the financial gain in crossing the chasm. It is not just about the money you make from the first niche: It is the sum of that money plus the gains from all subsequent niches.
A key lesson to learn here is that you want to target a beachhead segment that is: • Big enough to matter • Small enough to win, and a • Good fit with your crown jewels.
First you divide up the universe of possible customers into market segments. Then you evaluate each segment for its attractiveness. After the targets get narrowed down to a very small number, the “finalists,” then you develop estimates of such factors as the market niches’ size, their accessibility to distribution, and the degree to which they are well defended by competitors. Then you pick one and go after it.
To become a going concern, a persistent entity in the market, you need a market segment that will commit to you as its de facto standard for enabling a critical business process. To become that de facto standard, you need to win at least half, and preferably a lot more, of the new orders in the segment over the next year. That is the sort of vendor performance that causes pragmatist customers to sit up and take notice.
In the simplified model there are only two categories: 1) what we ship and 2) whatever else the customers need in order to achieve their compelling reason to buy. The latter is the marketing promise made to win the sale. The contract does not require the company to deliver on this promise, but the customer relationship does.
All this is music to the ears of pragmatist buyers who do not like to buy until there is both established competition and an established leader, for that is a signal that the market has matured sufficiently to support a reasonable whole product infrastructure around an identified centerpiece.
That category should be populated with other reasonable buying choices, ideally ones with which the pragmatists are already familiar. Within this universe, your goal is to position your product as the indisputably correct buying choice.
Chasm crossing requires a single target beachhead segment, and in that segment, there needs to exist already the budget dollars to buy your offer. To be sure, the budget will be “misnamed,” because it will be allocated to some brain-dead, ineffective Band-Aid approach to solving what has become a broken, mission-critical process.
Here there is one fundamental key to success: When most people think of positioning in this way, they are thinking about how to make their products easier to sell. But the correct goal is to make them easier to buy.
The goal of positioning, therefore, is to create a space inside the target customer’s head called “best buy for this type of situation” and to attain sole, undisputed occupancy of that space.
Remember, the goal of positioning is to create and occupy a space inside the target customers’ head.
In sum, to the pragmatist buyer, the most powerful evidence of leadership and likelihood of competitive victory is market share. In the absence of definitive numbers here, pragmatists will look to the quality and number of partners and allies you have assembled in your camp, and their degree of demonstrable commitment to your cause.
The concept of a whole product launch is a derivative of the widely known practice of a product launch. That is, whenever a new high-tech product is introduced, it is customary to launch it by first briefing the industry analysts and long-lead press editors well in advance of the launch date (so they can serve as references), and then taking the top company executives on a tour to the weekly trade press the week prior to announcement, with the announcement itself capped by an event.
Whole product stories, particularly ones sparked by partnerships and alliances coming together to bring off some wonderful result for a particular company, are the bread and butter of business fare. Companies organizing to bring off this feat consistently, and thereby dominate a particular market segment, are particularly of interest.
The goal of a whole product launch campaign, overall, is to develop relationships in support of a positive word-of-mouth campaign for your company and products.
The other thing to remember is that, once these relationships are in place, they represent a major barrier to entry for any competitor. Pragmatists and conservatives—the core of any mainstream market—like to do business with people they know.
The number-one corporate objective, when crossing the chasm, is to secure a distribution channel into the mainstream market, one with which the pragmatist customer will be comfortable.
during the chasm period, the number-one concern of pricing is not to satisfy the customer or to satisfy the investors, but to motivate the channel.
To sum up, when crossing the chasm, we are looking to attract customer-oriented distribution with one of our primary lures being distribution-oriented pricing.
Enterprise buyers making major systems purchases expect to pay hundreds of thousands or millions of dollars. In that context they are looking for a consultative sales experience that identifies their key needs and custom-fits the vendor’s offering to meet them. The direct sales approach meets this expectation via a top-down approach to marketing, sales, and delivery.
The marketing involved is called relationship marketing.
In building an early market, the fundamental return on investment is investor risk reduction, accomplished through converting an amalgam of technology, services, and ideas into a replicable deployable offering and proving that there are customer use cases that create a demand for this offer.
The key is to initiate the transition by introducing two new roles during the crossing-the-chasm effort. The first of these might be called the target market segment manager, and the second the whole product manager.
Whole product R&D is an emergent discipline. It represents a kind of convergence between high-tech marketing and consumer marketing, where, for the first time, the tools of the latter can be of significant use in solving the problems of the former.
