As far as I know, a few (up to 5) owners received their Tesla in the same week as I did. I might be the first because I opted for the earliest possible date. It’s a great car – beautiful, very powerful (4.2 seconds to 100 km/h) and still practical (5 seats, 2 trunks).
After accepting our incoming teams to the StartupYard 2014 accelerator, we sent all of them the same assignment. We asked them to fill in a “positioning statement.” It looks a lot like this.
Product Positioning Statement:
Our Product is
For (target customers):
Who (have the following problem):
Our product is a (describe the product or solution):
That provides (cite the breakthrough capability):
Unlike (reference competition):
Our product/solution (describe the key point of competitive differentiation):
Why A Positioning Statement Is Important
The positioning statement contains the core elements not only of a product, but also of its marketing and sales strategy. And while most of our teams have worked primarily on ways of describing their ideas, a positioning statement does more than this: it also justifies the notion of that idea becoming a business. As I’ve written here in the past, it’s important for a startup to have the concepts of saleability and market differentiation baked into the essence of the product. Writing a positioning statement, like writing a SWOT analysis, can reveal basic strengths and weaknesses in a product while it is still in the “idea” phase.
Even more importantly, a positioning statement is the basis for a lot of the work that will eventually go into making and marketing a product. By identifying the target market *before* developing the product, if possible, startups can save energy and time by focusing more on fulfilling the needs of the market being targeted, and not applying their energies to areas that are of little interest to that market.
And a positioning statement, well-executed, can be transformed virtually complete into the core marketing message for a product, once it is developed. Take this copy from Nest’s webpage. Nest was acquired by Google recently for $3.2 Billion.“Our mission is to keep people comfortable in their homes while helping them save energy, and with the next-generation Nest Learning Thermostat, we’re able to spread that comfort and savings to even more homes – and to help higher-efficiency systems perform the way they were meant to.”
Here are all the elements of a positioning statement. If the Nest founders filled in our form, it would look something like this:
Our Product is
For: Upper-middle class and wealthy people
Who: Own homes and spend a lot of money on energy costs and heating/cooling systems
Our product is a: Smart Thermostat and related products
That provides: Savings and increased comfort by improving efficiency of existing systems. Unlike: manufacturer provided systems
Our product/solution: Learns and intelligently adapts to the inhabitants to increase comfort at all times, while saving money
A Positioning Statement Tells the Truth
The above “translation” of the Nest positioning statement doesn’t say exactly what their marketing copy says of course. They don’t mention wealthy clientele for one thing. But at $130 for a smoke detector, and $250 for a thermostat, that is surely the market they are targeting. Their products are priced high enough to be clearly exclusive, but low enough not to seem extravagant or make a money-wise customer feel foolish for purchasing. And anyway, that messaging is not only found in the price, but in mention of homeowners, and of “higher-efficiency systems.” These subtle cues indicate to customers that the product is made for people who value performance, and are willing to pay to get it.
These are all elements of Nest’s marketing that are informed by the market segment they have chosen to address, from the quality of the products, to the design, to the sales language and the pricing. And so the marketing message that says: “this product is for you,” when speaking to its target client, is backed up by a product that is built with that person in mind. The mission is clear: this is not a product for anyone, but for someone very specific, so that when the customer comes across the product and thinks about buying it, he or she can immediately see that it is made for them.
Also, while the statement doesn’t appear to mention the competition at all, it does backhandedly reference the existing market by calling itself “next-generation,” and referring to “helping higher efficiency systems,” indicating that the current competition, while hardly worth mentioning, is manufacturer installed equipment- equipment that is, again, not good enough for the demands of the target market; the market served by Nest.
The main difference between a positioning statement and a full blown pitch is that the positioning statement says in plain words, what is really true about who your product is for, and what you believe its market fit to be. This will help you to stay away from visions of (and talk about) your product changing the world, even if it doesn’t really have the capacity or the capability to be a real world changing idea. Not all products have to be for everyone, and many of the best products aren’t. It will also keep you honest and focused; force you to focus on the needs of the clientele you have identified and are targeting. In short, a positioning statement is more likely to change the nature of a product, than changes to the product are likely to change the positioning statement.
Position Statement as Framework
Positioning of a product has often been described as “the organized system for finding a window in the mind.” That’s what Al Ries and Jack Trout described it in their book Positioning, a Battle for Your Mind, a groundbreaking work from 1981. The positioning statement supports these efforts: it targets the product toward a window, an opening, that the founders believe exists in the minds of consumers, and it attempts to fit the product through that window.
What our teams will discover about their windows: where they are, how big or small they may be, will be subject to change for the StartupYard 2014 teams, and so their positioning statements must also change with these new realizations. But keeping and referring back to the statements will provide an excellent guidepost for applying these changes rationally, and purposefully.
Last week, our Director Cedric Maloux wrote about the trials and travails of hiring a CTO or a developer, for startups that have neither. Can a technology business thrive, even if it doesn’t revolve around a bona-fide technologist? Cedric is not exactly enthusiastic about the idea: “It depends,” he says.
Companies that started as purely technical projects, supported by little more than the geeky-obsessive interests of people who would only later be labeled “founders,” are legion of course.
Why Business Oriented Might be Bad
Larry Page and Sergey Brin saw the genesis of Google as fodder for a research project, which they co-authored, replete with fascinatingly unprescient commentaries as “We have designed Google to be scalable in the near term to a goal of 100 million web pages,” and “we expect that advertising funded search engines will be inherently biased towards the advertisers and away from the needs of the consumers.” and absurdly understated ones like “We are optimistic … that there is a bright future for search.”
Their technical-single mindedness, and academic backgrounds, even led them to conclude, as a result of their research into the structure of their proposed search engine (Google was then more a mathematical design concept than a business), would be best served by remaining an academic project- implying that it was too fraught with ethical complications to become a real business.
Ethical complications or no, however, Google did become a business. A rather enormous and complicated, and profit motivated business. But would it have risen above the fold of a market then defined by get-rich-quick, morally flexible business approaches that were driven almost exclusively by profit incentive, rather than product and concept integrity?
It’s not an unfamiliar trajectory for a number of highly successful web projects that grew up, and became truly influential, following the tech bubble of the late 1990s.
Mark Zuckerberg, had he been anything but what he was, which can safely be described as not business oriented, would have viewed the potential market for social networking in 2003 with a jaundiced eye. The market was dominated by Myspace, an offshoot of a firm with an ignominious reputation for developing malware and spam delivery mechanisms centered around internet pornography sites, and had been built in a matter of weeks to explicitly ape the most popular features of Friendster, a less cynical, but perhaps less aggressive competitor. Myspace was then by some measures the most popular website in the United States (this was at a time in which the US still dominated international web traffic volume). It’s hardly a surprise that few were even considering taking on Myspace in its own market. Of course, Zuckerburg’s potential business partners had their own questionable judgement to consider.
Just as Brin and Page viewed search as fundamentally broken by the prevailing advertiser model, Zuckerberg clearly saw the social networking world as fundamentally broken for most of the same reasons. And yet his competitive nature drove him to enter the fray as an alternative that was based upon delivering desired results, with no eye to short-term profitability. This in a time in which an investor would have seen MySpace’s market dominance as a strong disincentive to enter the fray. Indeed, even when Peter Thiel did sign on as a Facebook investor, he had to wait 5 years for the company to reach profitability. It had been dominant in its market for several years before it ever became cash flow positive. That’s not a bet most investors would make, and with good reason.
Why Business Oriented Might be Good
The startup landscape of 2014 takes lessons from these successes, but should also pay equal attention to the drawbacks inherent in the approach that, while it worked in the long run for Brin, Page, and Zuckerberg, has sunk or failed to fuel the growth of thousands of would-be titans. For every Amazon, a company that manages, even if barely, to keep its revenues just above its costs as it continues to expand, there is a Pets.com, a company that loses more money, the faster it grows.
I caught up with Damian Brhel this week, from Brand Embassy, a startup that entered StartupYard in 2011. When asked if a business-oriented approach is an asset, even to a fledgling startup, his answer was an enthusiastic yes (lightly edited):Can a non-technical background be an asset for a founder of a tech company?
Damien: Sure, absolutely! Most startups fail because of sales, because they simply does not understand it. Maybe you can have awesome product, but if you don’t know how to market it, you’re gonna fail. However both have to be balanced – I can not imagine a tech company without a co-founder who has tech insight. I’ve seen a few and they have no idea how to develop, or how much it will cost, and that cause huge inefficiency. Plus, it’s not just product + sales, it’s also many other ordinary things such HR, formal bureaucracy, operations, finance management, intellectual property, law, etc – these are areas where many startups are not aware (and many tech guys don’t know them at all).
While it’s a popular trope to imagine that a technical wizard will accomplish the Zuckerbergian feat of creating a product that will somehow justify its own existence through sheer quality, mass appeal, or perfect timing, allowing the technical genius never to have to dirty his hands with business concerns, the realities of launching most products preclude that from ever being a reality.
In fact, the landscape of the technology business over the last 30 years suggests just the opposite: that the true titans had most of their greatest accomplishments thanks to brave and insightful business strategies, and thanks less to their technical accomplishments. It’s was the great triumph of Microsoft to license DOS to IBM, but they didn’t write DOS themselves. And it was the great accomplishment of Apple to push a consumer facing operating system in the 1980s, but the genesis of that idea came from the Xerox PARC, a technology that had been around for nearly a decade, with Xerox failing to grasp its potential.
A survey of the Forbes top 100, selecting only for purely tech companies, bears out the notion that the biggest tech companies are built on strong business credentials. Samsung, though it’s been around in some form since the 1930s, didn’t become a true technology company until it was consolidated by its Chairman Lee Kun-hee in 1987, an MBA from George Washington University. The story is much the same for Apple, Siemens, IBM, and others.
Exceptions in most areas are very common: Dell, Cisco Systems, Google, and Oracle were all started by prototypical computer geeks, but a common thread emerges: most of these tech-founder companies experienced their initial growth in specialized markets, and expanded into new verticals later on, while the largest companies entered the market in several verticles, more or less at once.
And the biggest growth occurs when a team is being led by someone who can make business decisions that reach beyond the level of product, and deal with the company’s place in the market- whether that CEO is a founder or not.
No One Road to Success
Perhaps the singular key to success among these purely technical teams was excellence, combined with adaptability. As Jobs found out in the 1980s, and Zuckerberg may yet discover, the key to survival is to adapt, and making wise business decisions, inasmuch as they may compromise the vision that a singular founder has for his products and his company, is vital for continued growth.
I was asked recently if we would accept a team without a technical co-founder in the accelerator program and as of now, I am still struggling in giving a straight razor-cut answer Yes or No.
– “It depends”
There are multiple parameters coming into friction when starting and running a startup and the personality of the founders is one of the most important one. Before looking at the idea, we have to decide if the person in front of us is capable of turning this idea into a sustainable business. In the case of a technical co-founder we also want to be sure that they have the right skills to deliver a good product. Not all technical co-founders are born equal.
Pure business founders, as a team, can apply to StartupYard. If they are selected, one of their first goals will be to find how to deliver the goods. This is a disadvantage compared to a team with a technical co-founder but not an impossible one to overcome. There are two ways to approach the problem: go on a hunt to hire a technical co-founder or a full-time developer (for cash and/or equities) or sub-contract the development of your first version. There are a lot of talented coders out there; who under the right management and direction will deliver your first version for a fraction of the price it would cost you to hire a full-time developer. Also the time it will take you to find that full-time developer might be longer than initially expected so you might want to get something out first while looking for your technical white knight. The difficulty, in either case, is to select them, understand how they work and make sure they are able to build what you have in mind.
How do you Hire a Developer or Technical co-Founder?
The first thing you want to find out when interviewing a developer, whether it is for a full-time position or for sub-contracting is if they have already built the same kind of product. The main reason why you want to know that is for the time-to-market of your startup. A developer who has already been faced with a similar system will know the caveats of one approach compared to another. Ask them for a sample of their work or a link to the service and see how it relates to what you want to develop. An online service is usually based on data you enter, store, manipulate, modify, search, display and interact with so ask them how this other product relates to yours in term of data manipulation and storage. You will save a lot of time and a lot of money if your candidate has done it before.
Tell them you would like to speak to 5 of their clients (in the case of a sub-contractor). A developer who has a good track record will have no problem providing you with the information. When contacting the former clients, ask them if they would hire him again and if so what would they pay attention to this time. If not, try to understand if the reason can be addressed by you.
Depending on the type of product your startup is about, it’s possible the developer will have to deal with some technologies he is not that familiar with. Ask them how many programming languages they are going to use and for each of them, ask them if they like this language and if they would consider themselves an expert at it or not (you can ask them to rate from 1 to 5 their knowledge of each programming language they are going to use). Programmers usually have one or two favorite languages so be wary of developers telling you they are an expert at everything but they do exist so make sure they can prove it to you.
Ask them how much they enjoy programming. Is it just a job or a passion? Do they participate in open-source projects? Like for any other position, the more passionate they are the better.
Developers are not worldwide renowned for being the most extroverted individuals (“Do I really have to talk to a person?” once joked a coder friend of mine) and you want to be sure that you will be able to get on well with them. Since you won’t understand what they are doing, you want to make sure you understand when they will explain to you what is happening in the software they write.
Ask them what makes a good developer and then ask them how this relates to them point by point. There are no good or bad answers; you just want to see how the person reacts when put in a defensive position and also how they consider themselves. Ask them how they handle delays in delivery of their software.
Show Them the Final Product
By now you need to have every single screen of your product designed in the form of wireframes or mockups and ideally documented. This is what they will use as a reference to build your product.
First, you want to see if they like your product or not and if they are going to be able to build it and in what amount of time. If they look at it and seem as excited as you are when you look at a pen on your desk, you might want to reconsider the person.
Looking at the screens, if you did your job well, your candidate should not have to invent what happens when a user clicks on a button or what happens when the user enters bad information of any sort. They concentrate on how to represent the data of your product and what needs to be done to them to go the next state. For each screen ask them if they see something that they do not understand and see how confident they feel about making it happen. Ask them once again if they have done it before. If you hear that a lot of screens ‘will not be that easy because…’ ask them how they would approach the problem. See how confident you feel about their confidence.
Be nice! You will meet some fantastic people with a passion for writing computer code. Try to understand them and create a connection because when you find the right person with the right skills and the right attitude, great things can happen.
Advertising to Sell Vs. Advertising to Learn
It’s quite common for a small company in ramen profitability to start treating every conversation with customers as a sales opportunity. That’s the right attitude, anyway. As I’ve mentioned here in the past, every interaction is a a kind of sale. Either you are selling yourself to an investor, the media, or a partner, or you are selling your product to a customer. But just as you should always refine your pitch based on how well it has actually worked, you should do the same with your advertising. In fact, you can use advertising as a very cheap and effective form of research.
Shopping your Brand, and Testing Assumptions
Shopping your brand is sort of like focus-grouping, only you do it in the wild, and you use real customers as the focus group. The idea is to get a good sense of whether your target market is who you think it is, and if so, what that group responds to best.
You may run into some surprises doing this. The people you are most willing to buy your products may not always be the ones you’d expect. A classic industry example is women’s underwear: Victoria’s Secret has long known that male customers will spend more money, faster, than women buying the same products, and will be less interested in discounts and sales. And the reasoning is simple: men feel uncomfortable shopping for intimate items, and also don’t want to be caught looking cheap while doing it.
By the same token, though women may take longer than men to make purchases online, they also buy more electronics than men do, and consume more online media, and spend more time on social networks, taking the majority share in Facebook, Twitter, and Pinterest.
Catering to a demographic doesn’t have to mean talking down to that demographic either. You don’t see Apple making stereotypical “lady Iphones,” but their products are possibly more popular with women than with men. I can guarantee: Apple tests their taglines and slogans on women as much as they do on men. If you were selling a sleekly designed, high end electronics toy to the top of the market, would you care what women thought of your marketing?
Assumption testing can prove that your products are appealing to people you never considered potential customers, and for reasons you haven’t even thought of.
Case in Point:
Cedric Maloux, our CEO, created an app for IOS last year, and as soon as he had a working app, he “shopped” it using a number of targeted ads on Facebook. And since Facebook allows you to segment your market and target your ads to people based on sex, he decided that he wanted to know which taglines would work more with women, and which with men.
Because the nature of the app was targeted at a hobby that is overwhelmingly popular with men, he was surprised to find that women responded to the ads too. Not as much as men did, but there were key taglines that women responded to. There were ways of representing the app that appealed to women even more than they did to men. And by using the “advertise for research” approach, he was able to zero in on marketing that worked across these different segments.
And it isn’t just gender, either. There are loads of assumptions you probably make about your customers, and which you can test very effectively for little cost.
Agile Marketing: How it works
Agile methodologies don’t work every step of the way. There’s no set of iterations you can take in coming up with your products that will take you from no idea what to do, to a completed project. You need to be inspired first- and without that, there is no testing to do; no basis of comparison between a non-process and a good process. The same is true of agile marketing. It relies best on a seed of inspired thinking about your customers and your product, followed by rigorous and ego-free examination of what really works. I’ve done tons of marketing material that I loved, and only a small minority of it ever worked well. That makes marketing and coding not so different at all.
Start with Simple QuestionsLike, what’s the first thing my customers see? Does it work? Does it work for the market I’m targeting? Could something else work better? Where am I losing customers?
If your company already has a logo, then you probably have a slogan and associated taglines too. There’s plenty of advice available about how to write them, and it isn’t actually that hard. I mentioned recently that a tagline or a slogan is more like a static element for a website. It’s fertile ground for A/B testing, and that’s what you should be doing- all the time, and not just for the homepage, but also landing pages for any campaign you run.
You can start with broad assumptions about your customers. Segment them into “likely,” and “unlikely” customer groups, and run a couple of different versions of ads and associated landing pages for each group. Create ads targeting both groups, and show them to both groups too. If your likely customers respond to the ads that target them, then you know you’re right about your market and your strategy. But if your unlikely customers respond more than you anticipated, you can continue to segment them, dialing in the specific messaging and the specific part of that market cohort that *is* responding to your marketing. You may find you’re sitting on a potential client base you never considered. And if your likely customers respond to your ads for your unlikely customers just as much as the ones targeted at them, then this may tell you that your messaging to these customers is not as effective as you thought it might be. You may have more opportunities to sell to this group with a different approach.
Set Clear Goals
Using a system like OKRs, set objectives that involve clear answers to your simple initial questions. For instance, a question like “Is my purchase page losing sales because of the design?” can be associated with an objective like: “improve purchase page performance by 25%,” with key results being simple items like: “define the most effective call to action,” and “reduce distracting elements that cause users to bounce or navigate away.” Now follow the formula: testing incoming hits on the purchase page while cycling through these changes. You may find that something as simple as a stronger call to action can raise your conversion rate from 0.20% to 0.25%, and in terms of an online store, that’s can be an enormous increase in revenue.
You may well be shocked to realize the difference a single element makes in your overall revenue when it iterates itself over thousands of hits on a landing page or a homepage every day. There, a tagline that works just 1 time in 1000 more than another can mean the difference between life and death.
But you want to be doing this testing now- not when thousands of page views are already in play. That’s why small ad-buys on facebook or other platforms can give you the intelligence you need to get ahead of these questions- before you realize you don’t have it right.
When I took my first marketing job, I assumed that writing was writing, no matter what you were writing about. So I sat down, strapped in, and learned as much as I could about what it takes to write email copy, landing pages, and sales campaigns. Easy, I thought. Turns out, it’s nothing like normal writing at all. Here’s what I learned.
The Call To Action“Don’t talk about what you want. Talk about what your customer is going to do.”
Last week we talked here about selling without selling. I’m going to reiterated the 7 principles that are mentioned in that post. These are the 7 elements that should be represented in some way, in every communication with a customer.
|Trust: In you and the product. Let the customer do what they would normally do. Understanding: Be as simple and clear as possible. The customer is not smarter than you. Emotions: Use humor, use evocative words, show love and caring. Show passion. What to do: Buy, sign up, click, share, read on When to do it: Now? Later? Soon? What I get out of it: Speak about effects of the product, not the features. When it will happen: Examples, case studies, quotes, and testimonials|
Last week we talked about the first 3. Now we’re going to talk about the middle two: what to do, and when to do it.
All of your marketing copy, the copy that is designed to lead a customer from contact with your website or marketing materials all the way to a purchase, has to inspire an action on the part of your customer- to draw the customer inexorably toward a purchase, a sign up, a click, a share, or any action that you want a customer to take.
What it Does
Your calls to action should always be just enough to inspire the viewer to take the next step he/she is comfortable with, and no more, engaging each user to the maximum of their comfort, without scaring them away by pushing them to a sale or action they aren’t ready for. This feeds back to trust: you should never be in the position of asking a customer to do anything he or she doesn’t understand.
If you think of your website or marketing approach as a pinball machine, your customer is the ball. Your marketing emails, landing pages, and homepage are all those little widgets and bumpers that keep the ball moving, and your copy is gravity. When the ball finally ends up falling into the hole, that’s a sale. Here’s the trick: pinball isn’t fun if the slope is too steep, and gravity is too strong. A satisfying sales experience, or any intended customer outcome, is one that feels natural, and rich for the customer. As the customer “bounces,” from one element of your online presence to the other, they should constantly be only in danger of heading towards a sale, never getting there unless they’re ready.
If you think of the customer as the ball, then you shouldn’t worry too much if they don’t go directly to a sale every time. The longer they bounce around and absorb what you do, and who you are, the more likely they are to eventually decide to buy. And the longer they take making the decision, the clearer it will be when they do buy that the product is right for them.
There’s rarely a reason to push: a customer will only ever buy when they are ready to buy, and not before. If you have a lot of hits on your purchase page, but few conversions, then you have probably already realized this: when confronted with a decision to buy, nobody is going to do it earlier than they expected, without a very good reason (that’s where discounts and promotions come in, but that’s another story).
What It Looks Like
Last month, I edited the StartupYard Homepage and a few other landing pages for copy. Our CEO Cedric Maloux had done the layout and the basic copy. Here’s what we started with:
What Are You Working On…?
We’re looking for the craziest, most ambitious projects out there, having to do with the manipulation of large clusters of Data.
Have you invented a new search algorithm to complete, or compete with, the big boys? We want to hear about it.
Do you have a new, unique way of making sense out of Data? We have x TB of data for you to play with.
This copy is good, but ask yourself: what are you being asked to do? The first line has an open question. That’s a good challenge to go further. Now we get an explanation, under the Data header, of what we’re looking for: “the craziest, most ambitious projects.” Well that’s nice, but what does it mean? Why are you being told all this?
And in the next header under Search, we explain what we want. Nobody wants to know what we want, unless it involves giving them money. And since we actually do want to give you money, why not come out and make that part clear? The site visitor is not sure who this information is for: does it apply to them? Will they find something they are looking for? They are not being given a direction to go in, only information to absorb. That’s only half of what they need. Here’s the copy with calls to action.
Now we have some strong direction. The visitor is being shown what we want, and being pushed to engage to their level of comfort. We have a call to connect in the second column, a challenge in the first, and an invitation in the third column. That’s three ways we’re inviting the user to go further right now. We don’t care how they do that: they can email us, they can read the rest of the homepage, or they can go right to the application. We make it clear here that they’re free to choose. They can seek their own level of comfort with the process.
While it seems superficial, these calls to action have powerful subconscious effects. In Blink, bestselling economics and sociology writer Malcolm Gladwell discusses widely known psycho-social experiments in which individuals are “primed,” with certain words before being placed in a social situation. For example, a person who is told to read a list of words including “patience,” “serenity,” and “calm,” is overwhelmingly more likely to wait patiently for her turn than a person who is told to read words like “aggressive,” “confront” and “fight.”
The words that an individual hears or reads has an enormous impact on how that person behaves in the short period afterwards. Words that prime for activity and exhort action will engender better results virtually all of the time.
Open for Business
Have you ever stood outside a shop or a restaurant, and not been completely sure that they were open, so you didn’t go in? Ever passed a restaurant because it looked closed, only to see someone come out and only then realize it’s open? We all have.
Now, think about those lit-up signs on shop windows; “Come in, We’re Open.” You might think you’re not affected by this kind of thing, but you are. Your confidence, inspired by this tiny little call to action, will empower you to stride directly to the front door and open it. No questions asked.
A homepage is no different. These kinds of calls to action are just a little tiny nudge saying: “We are here for you. This is about you. It’s not a blog, it’s not PR, and it’s not about us, it’s about you.”
A Good Call to Action is not Manipulative.
Sometimes marketers go a little nuts when they figure out that a call to action can be such a powerful thing. What would you do, for example, if I could promise you that I could increase your open rate on emails by 100% in one day? Would you want that?*
*This is a classic call to action, by the way: of course you want to increase your open rate by 100%. You are supposed to say yes.
What they can forget is that no matter how powerful a call to action, you can never sell someone who doesn’t want to be sold. Calls to action are nudges, not shoves.****And this is a classic trust-building rejoinder: I am telling you I understand your problem and I understand that the solution is not as easy as some say. I’m showing you that what I’m offering is better than the competition, and that I care about what’s best for you.
If I nudge you, you’ll scoot forward in the direction you want to go. If I shove you, you’ll go in the direction I wanted for a moment, and then start resisting me.
This is no different from the store analogy from earlier.
What kind of salesman do you trust? The one who waits for you to look around, then approaches you quietly and asks if you want help? Or the one who approaches you as you walk through the door and asks you what you’re looking for? The first salesman wants to help you. The second salesman wants to control you.
The first one gives you a choice: tell him what you are looking for, or say no, you don’t need help. Either way, you do what you want. The second makes a demand: tell me what you’re looking for, or break all trust, and lie, saying you are “just looking.” Either way, you are forced to choose between two options you may not like.
You may buy from the second salesman if you know exactly what you want, but you wouldn’t buy from him if you weren’t sure. You haven’t been given the space to establish comfort with his offerings, before he is pushing on you to tell him what you want to buy. And if he is very good, and manages to get you to make a purchase before you’re ready, you would never, ever return to that store. Your embarrassment would be too great. You’d associate him, and that product you bought, with an experience you’d rather forget. This is not a win for anyone.
Online marketing is no different. People know when they are being invited, and when they are being pursued. And they don’t like being pursued in that context.
Do you get those emails from click-bait websites, with some video and a headline that says: “Drop Everything Right Now and Watch This or You Will Be Sorry,” or something to that effect? We’ve all been there. Or maybe you see those chain letters on Facebook, that manipulate you into sharing some overly sweet piece of human misery, that turns out wasn’t true in the first place?
Yes, they work. Once. And while you can get a lot of traffic from a sensational headline, and a big email open rate from a grabby subject line, that’s all you’ll get: traffic. Because people know when they are being manipulated, and they don’t like it.
This kind of marketing is for ad-driven spam sites, not for an honest product site that is actually offering people something they need. So don’t be a manipulative bastard. It doesn’t work anyway.
Last week we announced that Seznam.cz was opening part of its search technology by providing a cluster of data. Today, we are happy to give you more details.
Seznam.cz full text search technology is based on Hadoop and Hbase. The teams will have access to a test cluster of up to 100 million documents from the Internet. All of them pre-crawled and sorted into entities such as domains, webservers and URLs. Each of these entities contains its own attributes for fast analysis and sorting of each web page in the cluster.
More specifically, the 3 entities are :
- Domains – these are equivalent to DNS name structure, domains are organized as a tree. Root entity is special domain “.”,
- Webservers – a “webserver” is the specialization of a “domain” (webserver = domain + port). They gather URL statistics and other attributes related to a webserver as a whole (for example content of robots.txt is Webserver relevant).
- URLs – a URL represents a document on a webserver. “URL” is always related to some “webserver”. It contains all attributes relevant to a single web page.
Each entity has a key. The key looks like a modified URL – the hostname parts are in reverse order, the rest of the url is lowercased and cleaned up. It is possible to recognize an entity type from its key value. For example:
- URL: http://www.montkovo.cz/Cenik/?utm_source=azet.sk&utm_medium=kampan11
- URL-key: cz.montkovo.!80/cenik
- webserver-key: cz.montkovo.!80
- domain-key: cz.montkovo.
The whole database is sorted via the key (ascending), so that all URLs on the same webserver are co-located and could be processed one after another.
Here is a list of common attributes for each entity:
- IP address of the domain (if exists)
- Number of direct sub-domains
- Number of all sub-domains
- Number of all webservers in all sub-domains
- Number of all known URLs (URLS related to all sub-domains). We call this state of URL as “key-only”.
- Number of all downloaded URLs. State “content”.
- Number of all processed URLs (i.e. parsed and extracted basic features). State “derivative”.
- Number of redirects
- Number of errors (i.e. URLs with downloading or processing error)
- Average document download latency
- Webserver homepage (key to that URL)
- Content of Robots.txt (robot exclusion protocol) relevant to our crawler
- Number of all known URLs (state key-only) related to this webserver.
- Number of all downloaded URLS (state content) related to this webserver.
- Number of all processed URLs (state derivative) related to this webserver.
- Number of redirects
- Number of errors
- Average document download latency
- URL as seen on the web
- Last download date
- Last HTTP status
- Type of the URL – could be few (not downloaded, web page, redirect, error, …). Mind: type of the URL is not the same as HTTP status. For example: HTTP status is 200 OK, but URL type is redirect, because we have detected software redirect within the page content.
- Attributes specific for different URL types:
- Not downloaded page
- We have no explicit information about this page. Only factors that could be predicted (for example document language) and off-page signals (like pagerank) are available.
- Prediction of document language
- Prediction of explicit content (porn)
- Pagerank – classic PR value calculated from link graph
- Link distance from webserver homepage
- List of backward links, each contain:
- Key of the source page
- Anchor texts relevant to this link
- HTML title of the source page
- Pagerank of the source page
- Web page (i.e. downloaded page with regular content)
- Alternative URLs for the page – each page could be presented under multiple different URLs. This is scored list of those possibilities.
- Detected document’s Content-Type
- Downloaded content
- Content version – date/time of content download. Could be different from last download date (note: 304 Not modified)
- Major language – language identified as “most relevant” for this page – could be different from most frequent language on page (different lang for body text vs. menus)
- Homepage – flag if this page is webserver’s homepage
- Pagerank – classic pagerank value
- Link distance of this page from webserver’s homepage
- Derivative (attributes obtained by further processing):
- Document charset
- Detected languages on page with their frequencies
- Explicit content flag – detected porn
- Document title
- Document <meta description …>
- Document content parsed down to a DOM tree
- Forward links found on the page
- List of backward links. Each one have:
- Key of the source document
- Anchor texts (extracted from source document) relevant to this link
- HTML title of the source page
- Pagerank of the source page
- Target URL key
- Homepage – flag that this redirect is part of redirect chain to a webserver’s homepage
- The same info as for “not downloaded page”
- We could provide some more, for example date of last download when the page was OK, if it would be necessary for something.
- Not downloaded page
With all this data at your disposal, what could you build? The cluster will be updated and new entries can be added as per team requests. We are looking for the best ideas in the area of Data, Search and Analytics.
Wherever you are in Europe, we will pay for your flight ticket and your accommodations for 3 months in Prague so that you can participate in our accelerator program. Why don’t you start your application now?
If you have any questions about the database, enter it as a comment below
As Internet professionals we get asked the same question over and over. “I have an idea for an internet company. How do I start?”
It’s simpler than it seems
My answer invariably is as follow:
“Start building… Make a mockup and show it to people around you. Listen to the feedback, throw away your first version and do it again with all the knowledge you have gained from future users. Do that over and over. Stop until they convince you or you convince yourself it’s a bad idea. In that case, kill it and wait for the next idea.”
You read it right: make a mockup and show it to people. This is the only possible first step you can take if you want to turn your internet idea into a business. Don’t think your first step is to write a business plan. That’s the last thing you should do. Right now you have no business even less a product. What you need to know now is if your idea is a product/service people will want. Have you already figured out what they will pay you for? The best way to start is to put your idea there in front of them and listen to what they say as they discover your mocked up service.
In case you feel that you are not a UX designer, that’s OK. You don’t have to be. You just need to be able to put your idea into some kind of wireframe without design. It’s actually not that hard to create a mockup, either it is for a website or for a mobile app. There are a few great tools if you just Google “Wireframing Tools”. I personally use Keynotopia.com – It’s a set of templates for PowerPoint and Keynote. Their homepage says:
“… testing app ideas in 30 minutes or less.”
And… it’s true. If you know how to use PowerPoint, you can create a mockup. I’m not related to them and have no interest if you buy their product. I’m just a happy customer and I use them all the time. They are always my first point of call when I have an idea (well, after the mind map but for that I just use a good old pen and paper).
Once you have your mockup ready, this is when you either have to build your site or app yourself, pay people in cash or equities to build it, or find someone who can finance the idea in exchange for some equities in the company that would be incorporated around the idea.
It gets better
If you are going to need investors, good news; your mockups are your best friends again. Show them your idea! Either they will want the app/service or they will not. The rest are financial details for them. These details are important of course, but now you have the interest of an investor. What’s important is that you can go from having an idea, all the way to raising seed funding with just mockups and a clear monetisation strategy. All it took was to iterate on mockups following users interviews.
That’s how you start an internet business. By creating a mockup of the idea.
It’s mockup time Baby!
Once again, the first thing they will want to see is what your idea is. Well… How convenient! You happen to have mockups available so they can instantly understand your idea and transform it into reality.
Once the product is developed you will need to become an online marketing wizard, and hope people will talk about it and refer new users every day. But that’s not how you start. That’s how you grow, and the topic of another blog post.
You can also apply to an accelerator like StartupYard. Not only will you receive funding to start developing your first version but you will also be exposed to hundreds of professionals and specialists who will become your mentors during the 3 months program and who will help you develop your idea and be exposed to even more people. And guess what? One of the first things you will do at StartupYard is create a mockup and show it to people to refine and refine again your idea until it’s perfect.
What a Pitch Really Is
Raising money is a deeply complex issue for a startup. We won’t reinvent the wheel here and now and tell you whether you’re even ready to try doing it. But we will talk about your “pitch.”
Founders often enter the pitch under the false assumption that investors are looking for someone like them. Someone who feels like a peer, whose job it is to convince them. Paul Graham of Y Combinator wrote about this recently“When people hurt themselves lifting heavy things, it’s usually because they try to lift with their back. The right way to lift heavy things is to let your legs do the work. Inexperienced founders make the same mistake when trying to convince investors. They try to convince with their pitch. Most would be better off if they let their startup do the work—if they started by understanding why their startup is worth investing in, then simply explained this well to investors.” – Paul Graham (Full Article here)
But your pitch is more than just a magical set of keywords that unlocks a golden elevator, filled with swimsuit models holding champagne flutes and suitcases full of money. The secret handshake theory of business is only attractive to those who aren’t sure who their customers are: investors or actual potential clients.
No, your pitch might be closer to your “identity,” as an early stage startup. Your pitch is not just your idea. That bears repeating. Your pitch is not just your idea: it is a demonstration of why you are a good bet. It’s also the first and consequently most important way that people will know you. VCs, angels, accelerators and even potential employees know you by your pitch. And avoiding the biggest mistakes, can be as key as making the best sounding pitch.
A Pitch is Creating a New Reality
One in which your product is real, and one in which it is something that customers need, and will pay for. This is why your pitch is not your idea. Your idea is plastic, and can change, but the reality you are pitching has to be real. Your product solves real problems.
And your pitch starts from day one. You should come up with a pitch that makes sense before going any further, because if you can’t sell your product, there may be little point in building it. This ice-cream shotgun is still genius, by the way, but the pitch didn’t work out, so I’m waiting for the market to present a need before investing.
What’s in the Pitch
This is a “positioning template” first suggested by Geoffrey Moore in Crossing the Chasm, a modern day “bible” for technology marketing. See if the pitch you have at the top of your head addresses each of these points in a meaningful way:
For (target customers)
Who (have the following problem)
Our product is a (describe the product or solution)
That provides (cite the breakthrough capability)
Unlike (reference competition),
Our product/solution (describe the key point of competitive differentiation)
In this post we’re primarily concerned with the first half of this template.
Create the Problem
All products and innovations address problems, and this is the For, and Who, and Unlike, of your pitch. A person/company/institution with an issue/need/lack/goal.
When entering your pitch, you should have in mind a typical customer who has a common enough problem. This works for anything- you just need to be creative. You are not inventing the need, but you are formulating its basis.
Nobody needed an electric typewriter in 1924 when IBM obtained patents that would later be used in its first commercial models. But there were key deficiencies in the design of manual typewriters, that caused common, known problems. Problems that could be solved. IBM identified those deficiencies, and attempted to eliminate them.
There was no work not being done because of these deficiencies; nobody was sitting around waiting for the automatic typewriter, but companies and individuals still invested in the new technology, not because they were aware of how automatic typewriters would revolutionize business, but because it solved problems they knew they already had.
Here’s a pitch for the electric typwriter, in this frame (freely invented by me):There are over 50 million typists, secretaries, students and amateur writers in America all grappling with the same issues. Current typewriters on the market have frequent jams, rust easily, cause pain in the fingers due to the difficulty of depressing keys, and create type which is often uneven, and illegible. Our new automatic typewriter solves all of those problems, using revolutionary new technology that prevents jamming, ensures even spacing, and is easy on the fingers. It produces clear, legible, even type, at a speed before totally unprecedented, allowing typists to work more productively, more quickly, and more happily. Better yet, it is cheaper to manufacture than a manual typewriter, accepting universally interchangeable parts.
You’ll find every element of the above template present. Who the product is for (and size of the market), what their problems are, what the competition offers, what our product is, and how it solves all of those problems, along with a litany of killer features, and even a case for profitability. It presents the investor with a world that is broken (typing sucks and it’s expensive), and then presents the solution (typing made easier and cheaper).
That is the sort of pitch that grew IBM’s revenue by a factor of 20 in 20 years, and its profits by a factor of 7 in the same time period. All based on solving basic deficiencies in its marketplace.
Not all products are as glamorous to you and I as the automatic typewriter. But think about the executives who funded its development in 1925. They didn’t touch typewriters. They had secretaries who did that, and they dictated letters or scratched notes on paper. Typewriters were manual labor, and beneath their pay grades.
Give the Solution
These people had to be convinced that a problem existed, and that others, office managers, schools, and institutions of government, would buy the solution, before they invested in buying the patents and funding its development as a commercial product. The pitch provides the investor with a reason why the product is needed, the evidence that there is a market for it, the evidence that the market will accept it, and the evidence that this will be a profitable venture.
And this kind of pitch can be given in 30 seconds, or in 30 minutes. If it makes the problem and the solution real, it can win an investment.
So however tedious the problems that you’re solving are, if you believe there’s a market for the solutions you offer, you have to make those problems real to investors. Presenting a killer solution, even when the status quo still works, is the key to making the problem real for an investor. Make that investor see the current state of affairs as a net loss, instead of a zero sum.
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