Could Your Product Be Too Early? How To Position It the Right Way (I Published an Article for Forbes)
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“Data is the new oil!”
If you are in big data like myself, I am sure you have heard of this one before. As the Chief Sales Officer of Cinema Intelligence, a big data company for movie exhibitors, I have had the good fortune of bringing in an innovative new software.
Now, here’s the dilemma: In the last few years, while there have been endless publications on how movie studios are extracting data from platforms such as Twitter, Facebook and Google, there have been very few publications on how movie theaters can make data-driven decisions to boost box office numbers.
While many small businesses and startups may see this as a red flag and blame poor “product market fit” if they had a lack of success in sales, we’ve found ways to succeed in the industry by positioning our product the right way. Below are a couple pointers I can share with you that may help you dramatically with your company’s growth:
Understand The Big Trends
You now have a groundbreaking product. However, before you jump on that first phone call or email your nicely tuned sales pitch, the first thing you must study is the general industry trend.
For example, in the U.S., the relationship with studios and theaters deeply impact a theater’s capacity to bring in new technology. This starts with the unusual power balance between studios and theaters. Unlike theaters in other countries, theaters in the U.S. do not offer as much diversity when it comes to content because of the limited number of studios they work with.
Furthermore, relative to foreign markets, the U.S. theater market is much more competitive, having dozens of mid-sized theater chains across the country. The six or seven major studios produce the bulk of the films, and there are tons of theaters to present the films, giving studios the edge when negotiating product. This contrasts starkly with a market such as India, where there is three to five times more content in any given year.
In such markets, the leverage in negotiation power theaters have allows them to have far more flexibility when trying new business ideas to push their products, which in turn allows them to try new software. Understanding this big picture helped us create a blueprint for success. When Cinema Intelligence first launched in 2011, our focus was to expand in markets that were much more receptive to new ideas and flexible to change. We were country-agnostic and expanded to markets in Africa, Asia and Europe. Additionally, it didn’t hurt that many film industries outside the U.S. have a relatively short history and theaters are founded by young entrepreneurs who are interested in leveraging the latest technology. Launching in 2011 was important for us, since we needed to find early adopters and clients who championed our product. It wasn’t until this year we finally decided to tackle the U.S. markets. For your product to achieve success, it is important to understand the big picture and find the markets that are willing to become the early adopters.
Understand Your Customer’s Needs
Oftentimes when presenting a new technology, customers may not know the value of your product. Furthermore, today’s products and services are far more complex than yesterday’s, and selling a product such as big data will require a commitment on your end to educate the customer. If a customer fails to understand your value proposition, this is on you and your sales team.
As you engage with your customer, you should be able to answer the following questions:
- What is the decision-making process like?
- Is the decision-making power centralized or decentralized?
- How great is their aversion to change?
- Who are the stakeholders that will be using the product?
- What does each department need?
One exercise that helped us during the sales process was setting up a discovery call. The purpose of the discovery call is to uncover the exact business processes of what decisions a theater makes throughout the entire lifetime of a movie. Once we understand their business processes from A to Z, we explain why the changes to their business add value. By pitching a solutions-driven presentation that explains the “why” instead of a product-driven presentation that explains the “what,” we are able to educate our customer. Additionally, oftentimes we do separate demos and presentations for each department. This is important because what could excite the marketing team can drastically different from the finance team. It’s all about dividing and conquering.
They say that you need to know your client’s business better than they know it themselves. While this is much easier said than done and can be quite challenging, you should always strive to do so. Lastly, if you’re a new business entering an industry with a new idea and haven’t quite proven your idea yet, feedback is essential and customization of your product will probably be expected. While you may see this as a cost, it is important to understand this as an opportunity. Customers will see it as a commitment to meet the expectations of your product performance. Therefore, invest in the relationship. If you’re able to establish yourself as a market leader in the industry after you capitalize on the first-mover advantage, your payoff can be immense.
Kevin Hong is the author of The Outlier Approach, Chief Sales Officer of Cinema Intelligence and co-founder of Dealflicks.