Rocky Mountain SBIR Conference Marketing Technology

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Rocky Mountain SBIR ConferenceMarketing
Technology

• Commercializing Innovation

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Double Exponential Growth in Innovation
DNA Sequencing
Doubling Every 12 Months
Source The Law of Accelerating Returns, Raymond
Kurtzweil
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Growth by Balance Tensions to Create Value
Value Created
Exploration
Disruptive 50
Exploitation
Growth d Exploration / d Exploitation
Value Created P X L
Next Gen 20-50
Incremental lt 20
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Growth Is Derived From Balance of Tensions
Growth is the only evidence of life. - John
Henry Newman
Exploitation Performance Driven
Exploration Learning Driven
Tension Growth
Conventional Wisdom
Nothing ventured nothing gained
Paradox
Without balancing tensions, something ventured
nothing gained
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ProblemQ How to Eliminate Waste Pain
Innovatively?
We are continually faced with a series of great
opportunities brilliantly disguised as insoluble
problems. - John W. Gardner
Market Aggregate of Individual Pain Waste
Individual Pain Exceeds Market Opportunity
Growth Tension
Conventional Wisdom
No pain, no gain
Paradox
Only gain by eliminating individual pain (yours
and markets)
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ProblemPain Is the Strongest Motivator for Change
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Point of ViewQ How do you see what is not yet
there?
It is always wise to look ahead, but difficult
to look further than you can see. Sir Winston
Churchill
Market Focused on What it Sees Today
Individual Focused on Seeing Tomorrow
Growth Tension
Conventional Wisdom
Seeing is Believing
Paradox
Seeing the Invisible is Believing in the Possible
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Point of ViewNew Value Creation Matrix
Remove
Reduce
Replace
Remain
Reform
Human error
Added AI
Human reports
Quality
Basic testing methodology
Standardized Color reports EMR
Audiologist constraint
Quantity
Otogram 24/7/365 Any language
Sound booth
Location
Any location
30 min Aud time
Time
Patient time
Aud double Treatment time
100K/yr Aud 1000 sq ft
Price
Same for equipment
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Point of ViewQuantify the Significance of
Innovation
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PropositionQ Is your Innovation Brilliantly
Simple?
Everything should be made as simple as possible,
but not simpler. Albert Einstein
Market only Wants and Understands Simplicity
Individual Deals with Great Complexity
Growth Tension
Conventional Wisdom
Keep It Simple Student (KISS)
Paradox
Simplicity Requires Brilliance from and for the
Student
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PropositionFour Cs of Value Proposition
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PositionQ What will you Become within your
Industry?
If your position is everywhere, your momentum is
zero. -Williams S Lipscomb
Incumbents Want to Retain Position
Must Knock Current Leaders Off Pedestal
Growth Tension
Conventional Wisdom
Bigger is Better
Paradox
Small and Focused Outperforms Big and
Bureaucratic
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PositionPorter Five Factor Analysis
SupplierPower
Industry Rivalry
Threat of Substitutes
Barriers to Entry
Buyer Power
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Position Blocking or Building AdoptionExample
Tympany (Hearing Diagnostics)
AAA
Aud
ASHA
HIS
AAO
4 ENT
1,2 ENT
PCP
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ProfitsQ When will you No Longer Need OPM?
Small profits and often, are better than large
profits and seldom. - German Proverb
Investors Provide Just Enough Capital for
Milestones
Entrepreneur Wants as Much Capital as Possible
Growth Tension
Conventional Wisdom
Money Solves All Troubles
Paradox
Capital Abundance Promotes Waste, Scarcity Forces
Innovation
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ProfitsTriangulate Your PL
Most Likely Outcome
How many sales do you need every day of all your
products and services?
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PurchaseQ When will you Sell, to Whom, in What
Form?
There are more fools among buyers than among
sellers. French Proverb
Always Creating Options for a Future Sale
Operating to Make it on Your Own
Growth Tension
Conventional Wisdom
Keep your cards close to the vest
Paradox
Valuable information never shared is worthless
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PurchaseNot All Purchasers Equal
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Fail-safe Growth Methodology4 Domains and 12 Ps
Qs of Entrepreneurship
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PromotionQ How will you Get Value into
Customers Hands?
Without promotion something terrible happens...
Nothing! PT Barnum
Need Seven Contacts to Care
Need to Ring the Register, Move On
Growth Tension
Conventional Wisdom
Build a better mousetrap, the world will beat a
path to your door
Paradox
The world doesnt know it needs a better
mousetrap, until you beat a path to its door
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PromotionDirect Sales Force to Launch, then
Distribution
General acceptance, distributors among large
companies Aggressively manage and develop
distributors, likely acquirers 5-25 M
Early adopters 5-15 sales reps 1-5 M revenues
Launch with thought leaders 1-5 sales reps 0-1 M
revenues
Small and focused can beat big and bureaucratic.
Large medical device companies must see sales
success to develop commercial interest. As sales
success increases, acquisition interest grows.
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PromotionHow are decisions made?
Buyers and Decision Makers
Beneficiaries
Users
B2C Simple Message Complex Distribution
B2B Complex Message Complex Distribution
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PromotionPricing

• B2B requires 1/3 COGS, 1/5 GA, 1/3 SM
• B2C requires 1/6 COGS, 1/5 GA, 1/2 SM
• Start high go low? Start low go high?
• Everything is priced against alternative (real or
  perceived) for benefits and features
• Product
• Service and Warranty
• If customers wont pay for value, move to
  performance offering if 50 increase in value

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PromotionSales Force Options

• Direct complete control
• You hire, you fire, you pay
• 6 months of financial burn until they sell
• You train, you monitor and get good data
• Indirect limited control
• You hire, you fire, you ONLY pay if they sell
• 6-12 months but NO financial burn until they sell
• You train, you CANT monitor, little data
• Distributors no control
• They hire, they fire, you ONLY pay if they sell
• 6-12 months but NO financial burn until they sell
• You train, you CANT monitor, little data

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PromotionDirect Sales Force

• Next generation and disruptive often require
  direct
• What level of talent do you need? 10-20 of ASP
• Mediocre - 60K - 300-600K sales
• Solid - 100K - 600-1,000K sales
• Superstar - 200 - 1000-2000K sales
• Keep them hungry
• 100 to 25 commission
• Give them discretion over marketing
• Keep them focused on present
• Hiring and firing
• Monster rapid hire
• Rapid fire, 33 annual turnover

Can you afford a direct sales force? Sales/reps
X 20 Needs to equal 100K
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PromotionIn-direct Sales Force

• Have existing customers that buy products like
  yours
• Not great sellers of innovation, wait for the
  phone to ring
• Must pay 25-33 of top line as commission
• Require extensive training and follow up
• Will not provide you meaningful feedback on sales
  process
• Treat all customer contact and information as
  confidential
• Becomes lost in large catalog
• Like rolling the dice

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PromotionDistributor Sales Force

• Have existing customers that buy products like
  yours
• Not great sellers of innovation, wait for the
  phone to ring
• Must pay 33-50 of top line as commission
• Will hold inventory
• Require extensive training and follow up
• Will not provide you meaningful feedback on sales
  process
• Treat all customer contact and information as
  confidential
• Becomes lost in large catalog
• Like rolling the dice

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PromotionMarketing plans

• There is NO silver bullet
• Advertising
• Conferences
• Tradeshows
• Direct mail
• Telemarketing
• Webvertising
• Referrals

• What is the cost to get a
• Lead - 50-150
• Meeting - 150-250
• Contract - 250-500
• Sale - 500
• What is your average
• customer acquisition cost

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PromotionAdvertising

• How do you know its effective?
• If you are not going to advertise at least 7
  times in a year then dont start
• Minimum budget for most ad campaigns should be
  25-50K
• Webvertising can be effective in some markets,
  very targeted, meaningful detail
• TV infommercials based upon high reorder rates
  and/or very high (greater than 90) gross margins
• How much more could you get with direct marketing?

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PromotionTradeshows and conferences

• Highest yield on dollars spent based upon
• Direct customer feedback
• Access to customer
• Communication of message
• Create action and urgency
• Creating highly qualified leads
• Will cost 10-20K per show or conference

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PromotionDirect mail and telemarketing

• Very targeted
• Very cost effective
• Very low success rate, 1-5
• Need frequency 5-10 times per year
• Need variety cards, letters, dimensional
• Need quick follow up

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PromotionReferrals and testimonials

• Most effective marketing
• Most efficient marketing
• Happy customer tells 1-3 people
• Unhappy customer tells 7-10 people
• Do what it takes to keep them happy

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PromotionTracking effectiveness
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PromotionTracking effectiveness
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PeopleQ How malleable must your people be?
Life is a process of becoming, a combination of
states we have to go through. Where people fail
is that they wish to elect a state and remain in
it. This is a kind of death. Anais Nin
Management needs employee to change
Employees want stability
Growth Tension
Conventional Wisdom
Human Resources our greatest resource
Paradox
Adaptable people our greatest resource, all
others are Human Resources
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PartnersQ How do you Create a Mutual Benefit
Network?
Geography has made us neighbors. History has
made us friends. Economics has made us partners,
and necessity has made us allies. - John
Fitzgerald Kennedy
Partners View you as a Nice to Have
You have to have Partners
Growth Tension
Conventional Wisdom
If you want something done right, do it yourself
Paradox
Cooperate as if partners do it all, work as if
you do it all
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PerformanceQ What Risks Must you Assume for
Adoption?
The fact is that one side thinks that the
profits to be won outweigh the risks to be
incurred, and the other side would rather avoid
danger than accept an immediate loss. -
Thucydides
Individual Takes Enough Risk for Adoption
Market Does Not Want to Take Risk
Growth Tension
Conventional Wisdom
A bird in the hand is worth two in the bush
Paradox
Growth requires reaching out and grabbing the bush
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PerformanceBusiness and Revenue Model Complexity
Total Performance
Operating Services
New Products
Business Complexity
Disposable Rental
Warranty
Product
Relationship Complexity
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ProcessQ How do you Ensure Constant Improvement?
If you want things to stay as they are, things
will have to change. - Giuseppe Tomasi di
Lampedusa
Markets and People Desires Predictability
Growth Requires Frequent Change
Growth Tension
Conventional Wisdom
Haste makes waste
Paradox
Waste is the lubricant of rapid innovation
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ProcessCRM Customer Resource Management

• Netsuite ERP and CRM - 5K
• Gather and track all customer information from
• Lead to customer
• Contact, contract
• Service and follow up
• Primary benefits
• Better communication within and without firm
• Collect vital data and details and sales history
• Create detailed profiles of preferences
• Instant company-wide access to information
• Identify new sales opportunities

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ProductionQ Why, How will Production be your
Achilles Heel?
The object of all work is production or
accomplishment and to either of these ends there
must be forethought, system, planning,
intelligence, and honest purpose, as well as
perspiration. Thomas Alva Edison
Constantly Innovate and Improve
Stabilize the Product and Make a Million
Growth Tension
Conventional Wisdom
If its not broke, dont fix it
Paradox
Innovation requires constantly breaking and
fixing it
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