Take It to Market
At the Connected World Conference this past June in Santa Clara, one company on display had a toaster that tweeted whenever it had finished toasting a slice of bread. It had hundreds, if not thousands of followers; more than even some people have on Twitter these days!
A tweeting toaster has no obvious utility and little potential for a lucrative business. However, machines that let you know when they have accomplished a certain task do provide a useful service.
Consider a washing machine and dryer that tweet you when your laundry is done. Rather than sit waiting for your laundry to be done in a dingy, noisy, smelly laundromat with unsavory characters hanging around, a person can leave and do other things with the confidence they can get back to the laundromat in time to finish their laundry without any unnecessary delay.
MIT’s Media Lab developed such a device with “some electronic junk in a spare bin.”
With that in mind, let’s take a tweeting washer and dryer as our case study in how to take your M2M product to the next level.
Keep in mind, our tweeting device has no fundamental technical breakthrough; it is just a new way to use existing technology.
Therefore, technology risk is minimal and intellectual property protection is not really an option. Corporate structure issues are easy to resolve. Space limitations prohibit addressing these risks in depth. Execution risk remains—the greatest risk is the same facing most new connected products.
Four Noble Issues
Four areas are critical for success with your connected product: Market, product, team, and go-to-market strategy and tactics.
These areas should not be addressed independently of each other. The targeted market will impact what product to develop, the team and talent required, how the product is positioned in the target market, and what go-to-market tactics to use. Feedback loops in these discussions are critical.
Sample questions might include: If we target the owners of the laundromats, what kind of connected product will make them money and help attract new customers? Does this require that each machine be retrofitted with our tweeting device?
How can we make this retrofit easy and quick? How does this affect our product design? Who can we hire that can crack this laundromat market? What trade shows must we attend? And so on.
If we target the laundromat user, how can we make a connected product that is easy to attach to the washer/dryer and that can accurately determine when the cycle is completed? And can we make it difficult to steal? How do we sell directly to the consumer? Are colleges and universities good first markets? And so on.
Now it is time to determine the best first market for the connected product. Whiteboard work is necessary, but insufficient. Perhaps the most important decision is to determine which market to target.
As Steven Blank in his book “Four Steps to the Epiphany” says, “the answers lie outside your offices.” Blank describes customer development as a parallel process whereby the entrepreneur validates his assumptions with the potential customer.
I would also add that only concrete commitments from potential customers validate any real interest. Commitments can range from a simple non-disclosure agreement; to a meeting with a group of key technologists or product marketing people; to a destructive testing agreement. Or, it can mean a product purchase agreement. Talk is cheap, concrete commitments are not. Without a concrete commitment from potential customers, you have nothing.
For the tweeting washer/dryer, we’ll assume that laundromats emerge as the best first market. Laundromat owners do not want to wait for the companies that make washers and dryers to integrate a tweeting mechanism into their machines. That could take years.
So, the majority want a product their repair staff can easily integrate into the existing cash acceptance devices on the machines. They additionally want to charge for the tweeting service.
Product Follows Market
Only from these in-depth customer conversations can the final product be developed. In our case, the product needs easy integration into the coin machine on each washer/dryer. Ideally, the typical repairperson must have the skills to add the tweeting device to each machine.
Team holes must be filled with new team members. Achieving orbit with a new product or company takes energy. People provide that. Most new technology products have very strong technology teams, but lack marketing, sales, strategy, and operations skills. Rather than trying to magically convert an engineer to a salesman by changing their title, better to attract the right talent to the team.
For our tweeting washer/dryer case study with laundromat users as the target market, in addition to direct sales, we may explore marketing or licensing agreements with channel partners, and we may want to have a booth at an event like The Clean Show, which is, the largest trade show for the laundry market.
Taking a new M2M product to the next level is a complex subject that requires some important decisions about market, product, and talent that are best addressed early and with ample feedback.
Gerry Barañano is principal of the revlaunch co., www.revlaunch.com, and entrepreneur in residence for the tech futures group, www.techfuturesgroup.org, and can be reached at email@example.com