The first rule of fight club is…. 29 September, 2011
Posted by varoom in Uncategorized.add a comment
I often advise early stage entrepreneurs to check with real customers that their perception of the value of the product is correct. This means speaking to people. BUT how do you do market research, on your new product idea, without giving away the farm? It’s very easy to give a clue to a prospective customer that you are thinking about developing a product to solve a problem the customer has. This may not be serious at first glance but it is very easy for these customers to ask similar questions of their current suppliers. “What are you doing to solve this big problem?” or even “someone else has proposed a solution to this problem so you’d better hurry up…” are easy questions that can let your new idea leak out into the marketplace. When this happens you risk allowing another competitor with greater resources, funding or technology to catch up with your thinking.
So the first rule of Fight Club is…NEVER talk about Fight Club! What I mean is you must do everything you can never to talk about your new product idea until it’s fully baked. You have to do market research in a way that hides the true nature of your investigations, research a wider subject area with potential prospects, create situations where the answers to your questions come from the customer without prompting. I make it sound easy…I know…but that’s what real marketing guys do best.
So my first rule for Entrepreneurs is …. don’t talk about your new product idea.
Grev
Hiring a sales guy is like buying a gun 7 March, 2011
Posted by varoom in Management, Selling.add a comment
Don’t worry it’s just an analogy…If you were to buy a gun, for arguments sake, and tried to do some target shooting but failed to hit anything you aimed at. What do you think the gun shop would say if you took the gun back claiming it didn’t work, because it kept missing the target?
In my analogy, when a new company hires their first salesperson I often hear complaints about the performance of said salesperson very early on in the relationship. I believe that hiring a salesperson is just like buying a gun. You need to select the right weapon that is suited to the target you plan to aim at and you must aim (direct) the weapon at the target accurately enough to stand a good chance of hitting it first time. You also must think about selecting the best ammunition in order to create the desired impact on the target.
A failing relationship with a salesperson is as much to do with the company engaging that salesperson, where they are directed and what ammunition they are armed with.
In this context aiming your salesperson is all about choosing the right customers/market sectors where your product has the best fit, arming them with the right tools & training in order to have the best chance of success in hitting the target the company wants to aim at.
The lesson to be aware of is this: If your salesperson is failing in their job, look at what you are doing first, improve your aim, supply more useful ammunition and stand back…. This is pretty much what the advice from the gun shop would be too.
Grev
It’s in your customers’ interest to pay royalty fees 22 December, 2010
Posted by varoom in Selling, Strategy.add a comment
I spent quite a few years selling technology in my career both in products and as licensable technology. In the latter part I spent 6 years acquiring technology for a large semiconductor manufacturer.
This experience gave me a good perspective, from both sides, on the subject of paying royalty fees for licensed technology.
I remember once telling a senior executive of a large US company that it was “in his interest to pay my company royalty fees…” much to his surprise. He demanded that I convince him. This is the explanation I gave.
There are three reasons (the 3 R’s as I call them, Reward, Retention and Rejuvenation) that customers should pay royalty fees.
Firstly REWARD: Part of the royalty fee is a reward to the inventor/creator for the initial innovation and the effort required to turn it into a product that the licensee can use. This reward motivates the inventor/creator to do it again.
Secondly: RETENTION: Providing an ongoing revenue stream that keeps resources & skills inside the company attached to the technology and available for the Licensee if required. If these resources are moved off to other more lucrative projects when the revenue is gone this could be an issue for the Licensee.
Thirdly: REJUVENATION: To motivate the inventor/creator to continue developing enhancements/improvements in the technology that the Licensee can benefit from in the future.
The key factor here is ongoing revenue stream that the Licensor can attach to the resources. If the fee is all paid up front (in a Buyout license) then a couple of years down the road these valuable skills will be working on another project and will have lost some valuable know-how regarding the licensed technology.
The customer (Licensee) can be convinced that it’s really in their interest to pay royalty fees, try it; you may be surprised at their response!
