Class 4 Berkeley/Columbia demand creation
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Transcript of Class 4 Berkeley/Columbia demand creation
The Lean LaunchPad
Session 4: Customer Relationships (Demand Creation)Session 4: Customer Relationships (Demand Creation)
Professors Steve Blank,Jon Feiber, Jim Hornthal, Oren Jacob
https://sites.google.com/site/xmba296t/
XMBA296T
Agenda
• Logistics• Customer Discovery/Validation – in the real world• Demand Creation Definition• Demand Creation Physical• Demand Creation Web/Mobile/Cloud• Metrics and Experimentation
How Are You Doing?
• Teamwork– Roles– Conflicts– Blogging
• Pivots– If you haven’t done any it’s the wrong class for you
• Speed– If you’re working in your comfort zone it’s 10x too slow
The Customer Development Process
Customer DiscoveryCustomer Discovery
Customer ValidationCustomer Validation
Customer Creation
Customer Creation
Company Building
Company Building
Pivot
The Customer Development ProcessCustomer Discovery
Customer DiscoveryCustomer Discovery
Customer ValidationCustomer Validation
Customer Creation
Customer Creation
Company Building
Company Building
Bus Model Canvas
Bus Model Canvas
Extract Hypotheses
Extract Hypotheses
Test Problem
Test Problem
Test Solution
Test Solution
Pivot or ProceedPivot or Proceed
Customer Discovery: Physical/Web
Bus Model Canvas
Bus Model Canvas
Extract Hypotheses
Extract Hypotheses
Test Problem
Test Problem
Test Solution
Test Solution
Pivot or ProceedPivot or Proceed
Customer Discovery
Bus Model Canvas
Bus Model Canvas
Extract Hypotheses
Extract Hypotheses
Test Problem
Test Problem
Test Solution
Test Solution
Pivot or ProceedPivot or Proceed
Customer Discovery - Physical
Bus Model Canvas
Bus Model Canvas
Extract Hypotheses
Extract Hypotheses
Test Problem
Test Problem
Test Solution
Test Solution
Pivot or ProceedPivot or Proceed
• TAM/SAM• Product MVP• Customers• Channel • Market Type• Customer Relationships: Get/Keep/Grow• Key Resources• Partners• Pricing
Customer Discovery - Web
Bus Model Canvas
Bus Model Canvas
Extract Hypotheses
Extract Hypotheses
Test Problem
Test Problem
Test Solution
Test Solution
Pivot or ProceedPivot or Proceed
• TAM/SAM• Low Fidelity MVP• Customers/Source• Channel • Market Type• Customer Relationships: Acquire/Activate• Traffic Partners• Pricing
Customer Discovery - Physical
Bus Model Canvas
Bus Model Canvas
Extract Hypotheses
Extract Hypotheses
Test Problem
Test Problem
Test Solution
Test Solution
Pivot or ProceedPivot or Proceed
• TAM/SAM• Low Fidelity MVP• Customers• Channel • Market Type• Cust Relationships• Traffic Partners• Pricing
• Customer Contacts• Problem Understanding• Customer Understanding• Market Knowledge
Customer Discovery - Web
Bus Model Canvas
Bus Model Canvas
Extract Hypotheses
Extract Hypotheses
Test Problem
Test Problem
Test Solution
Test Solution
Pivot or ProceedPivot or Proceed
• TAM/SAM• Low Fidelity MVP• Customers• Channel • Market Type• Cust Relationships• Traffic Partners• Pricing
• Customer Engagement• Test Low Fidelity MVP• Customer Understanding• Traffic & Competitive Analysis
Customer Discovery - Physical
Bus Model Canvas
Bus Model Canvas
Extract Hypotheses
Extract Hypotheses
Test Problem
Test Problem
Test Solution
Test Solution
Pivot or ProceedPivot or Proceed
• TAM/SAM• Low Fidelity MVP• Customers• Channel • Market Type• Cust Relationships• Traffic Partners• Pricing
• Update Bus Model• Create Prototype/Prod Presentation• Test Solution with Customer• Update Business Model• 1st Advisory Board Members
Customer Discovery - Web
Bus Model Canvas
Bus Model Canvas
Extract Hypotheses
Extract Hypotheses
Test Problem
Test Problem
Test Solution
Test Solution
Pivot or ProceedPivot or Proceed
• TAM/SAM• Low Fidelity MVP• Customers• Channel • Market Type• Cust Relationships• Traffic Partners• Pricing
• Customer Engagement• Test Low Fidelity MVP• Customer Understanding• Traffic & Competitive Analysis
• Update Bus Model• Test High Fidelity MVP• Measure Customer Behavior• Update Business Model• 1st Advisory Board Members
Customer Discovery – Web/Physical
Bus Model Canvas
Bus Model Canvas
Extract Hypotheses
Extract Hypotheses
Test Problem
Test Problem
Test Solution
Test Solution
Pivot or ProceedPivot or Proceed
Verify the:• Value Prop• Cust Segment• Cust Relationships• Channel• Revenue Model• Pivot or Proceed
• TAM/SAM• Low Fidelity MVP• Customers• Channel • Market Type• Cust Relationships• Traffic Partners• Pricing
• Customer Engagement• Test Low Fidelity MVP• Customer Understanding• Traffic & Competitive Analysis
The Customer Development ProcessCustomer Validation
Customer DiscoveryCustomer Discovery
Customer ValidationCustomer Validation
Customer Creation
Customer Creation
Company Building
Company Building
Get Ready to Sell
Get Ready to Sell
Sell, Sell, Sell
Sell, Sell, Sell PositioningPositioning Pivot or
ProceedPivot or Proceed
Customer Validation - Web
Get Ready to Sell
Get Ready to Sell
Sell, Sell, Sell
Sell, Sell, Sell PositioningPositioning Pivot or
ProceedPivot or Proceed
Pivot
Customer Validation - Physical
Get Ready to Sell
Get Ready to Sell
Sell, Sell, Sell
Sell, Sell, Sell PositioningPositioning Pivot or
ProceedPivot or Proceed
• Craft Positioning• Develop Sales Materials• Hire “Sales Closer”• Sales Channel Action Plan• Refine the Sales Roadmap• Formalize advisory board
Customer Validation - Web
Get Ready to Sell
Get Ready to Sell
Sell, Sell, Sell
Sell, Sell, Sell PositioningPositioning Pivot or
ProceedPivot or Proceed
• Craft Positioning• Acquire/Activate Plans and Tools• Build High Fidelity MVP• Build Metrics Toolset• Hire data analytics chief • Formalize advisory board
Customer Validation - Physical
Get Ready to Sell
Get Ready to Sell
Sell, Sell, Sell
Sell, Sell, Sell PositioningPositioning Pivot or
ProceedPivot or Proceed
• Craft Positioning
• Acquire/Activate Plans• Build High Fidelity MVP• Build Metrics Toolset• Hire data analytics chief • Formalize advisory board
• Find Earlyvangelists• Test Sell – Out of the Building• Refine Sales Roadmap• Test Sell Channel Partners
Customer Validation - Web
Get Ready to Sell
Get Ready to Sell
Sell, Sell, Sell
Sell, Sell, Sell PositioningPositioning Pivot or
ProceedPivot or Proceed
• Craft Positioning
• Acquire/Activate Plans• Build High Fidelity MVP• Build Metrics Toolset• Hire data analytics chief • Formalize advisory board
• Prepare Optimization Plans & Tools• Out of the building Activation Test• Measure and Optimize Results• Test Sell Traffic Partners
Customer Validation - Physical/Web
Get Ready to Sell
Get Ready to Sell
Sell, Sell, Sell
Sell, Sell, Sell PositioningPositioning Pivot or
ProceedPivot or Proceed
• Craft Positioning• Acquire/Activate Plans• Build High Fidelity MVP• Build Metrics Toolset• Hire data analytics chief • Formalize advisory board
• Prepare Optimization Plans• Out of the building Activation Test• Measure and Optimize Results• Test Sell Traffic Partners
• Company Positioning• Product Positioning• Validate Positioning
Customer Validation - Physical/Web
Get Ready to Sell
Get Ready to Sell
Sell, Sell, Sell
Sell, Sell, Sell PositioningPositioning Pivot or
ProceedPivot or Proceed
• Craft Positioning• Acquire/Activate Plans• Build High Fidelity MVP• Build Metrics Toolset• Hire data analytics chief • Formalize advisory board
• Prepare Optimization Plans• Out of the building Activation Test• Measure and Optimize Results• Test Sell Traffic Partners
• Assemble Data• Validate Business Model• Validate Financial Model• Pivot or Proceed
23images by JAM
customer segments
key partners
cost structure
revenue streams
channels
customer relationships
key activities
key resources
value proposition
Test Hypotheses:• Problem• Customer• User• Payer
Test Hypotheses:• Demand Creation
Test Hypotheses:• Channel
Test Hypotheses:• Product• Market Type• Competitive
Test Hypotheses:• Pricing Model / Pricing
Test Hypotheses:• Size of Opportunity/Market• Validate Business Model
Test Hypotheses:• Channel• (Customer)• (Problem) Customer
Development Team
Agile Development
CUSTOMER RELATIONSHIPS
what relationships are you establishing with each segment? personal? automated? acquisitive? retentive?
Demand Creation
• How will customers segments hear about your product?
• How does market type impact my strategy?• How much will it cost to acquire a customer
using these strategies?
Market TypeExisting Resegmented New
Customers Known Possibly Known Unknown
Customer Needs Performance Better fit Transformational improvement
Competitors Many Many if wrong, few if right
None
Risk Lack of branding, sales and distribution ecosystem
Market and product re-definition
Evangelism and education cycle
Examples Google Southwest Groupon
Market Type determines:Rate of customer adoption
Sales and Marketing strategiesCash requirements
How does market type influence demand creation?
Demand Creation by Market Type
Create, drive demand into your sales channelExisting
Resegmented
New
Educate the market about what’s changed
Drive demand into channel
Educate the market Identify/drive early adopters into your
sales channels
Clone Copy a business
Who needs to hear about you?
Suppliers
Channels
Government
Partners
End User
Influencer / Recommender
Economic Buyer
Decision Maker
Demand Creation Feeds the Sales Funnel
PayingCustomers
$
Demand
Creation Acquisition
Demand Creation Feeds the Sales Funnel
PayingCustomers
$
Demand
Creation Acquisition
Getting Free Users
• SEO (without consultants)• Blogging / Sharable content• Social Media / Gaming
Mechanics• Communities• Proven viral coefficient > 1
NOTE: “Viral” isn’t a strategy, it’s a product feature you either have or you don’t
Demand Creation
Paid Channels
• PR• Demand Capture
– SEM– “Free” products (e.g. widgets)– Biz Dev– Affiliate Marketing
• Market Education– Webinars– Email marketing– Trade Shows– Analyst Reports– Direct Sales– TV / Radio
Demand
Creation
“Get Customers” Funnel
Get Customers Funnel - Physical
Get Customers Funnel - PhysicalEnterprise Software
Leads
PayingCustomers
$
Qu
alif
ied
Le
ad
Fir
st S
ale
s C
all
De
mo
ns
tra
tio
n
Fe
asib
ility
Pro
po
sa
l Purchase Order
Earned and Paid
Media Get Customers
Keep Customers
Customer check-in calls
Customer satisfaction survey
product updates
Loyalty Programs
Keep Customers Funnel - Physical
Earned and Paid Media
Get Customers
Keep Customers
Customer check-in calls
customer satisfaction survey
product updates Loyalty Programs
Grow Customers
Grow Customers Funnel - Physical
“Get Customers” Funnel
Viral Loop
Earned and Paid Media
“Get Customers” FunnelPR
SEO
Advertising
Blogs/Website
Tradeshows
Viral Mktg
SEM/PPC
Affiliate Mktg
Viral Loop
Contests,eventsBlogs,
RSS, emails
product updates Affiliate Programs
“Get Customers”
Viral Loop
Earned and Paid
Media
Loyalty Programs
Keep Customers
Keep Customers
Contests,events
Blogs, RSS,
emails
product updates Affiliate Programs
Grow Customers
Loyalty Programs
Viral Loop
Earned and Paid
Media
• How many come through the first step?
• How much does that cost?
• What is the conversion between each level?
• How much in revenues can you get out of each acquired customer?