AT&T waves the white flag at the mobile Internet buffet

Hope you’re all enjoying the excesses of the holiday season.  AT&T appears to be suffering.  Imagine deciding to stop selling your hottest product in your second largest target market. The location with the presumably second highest concentration of bloggers and influencers after San Francisco. Apple must have been livid.

Courtest U.S. Naval Historical Center

The recent decision by AT&T to stop selling iPhones online to people with a NYC zip code was not officially promoted or explained.  An online customer service rep reportedly explained “New York City is not ready for the iPhone.” If AT&T is lucky, the quick reversal of this heinous error may prevent its complete nullification of the millions spent on national advertising campaigns for their allegedly superior 3G network.

You can pummel people over the head with old school marketing, but if you stop selling the phone, no matter what the excuse, especially after your CTO admits how challenging its been and your CEO starts talking about charging based on data use, you’ve basically proven your network can’t keep up with demand.

If its really the case that they can’t keep up with surging demand, then all carriers and users are in for hell as the mainstream discovers the joy of a mobile all-you-can-eat Internet buffet.  Enjoy the streaming video while you can 🙂

10 Years, 10 Lessons: Year 8: Enterprise Software is Dead

photo courtesy of Tony the Misfit

photo courtesy of Tony the Misfit

User experience is a necessary organizational capability

Obviously, companies will keep buying software.  But the opportunities for a new SAP or Seibel are few and far between.  I ran a session on this at P-camp 08 last year, and the group was pretty vocal – the traditional software model has to change.  The consumer software market has lifted the bar for expectations for enterprise software: it should be easy to use, offer fast screen response times, constantly improve, and be much, much cheaper.

Customers don’t want:

  • To be sold software by the equivalent of a car salesman that can’t even remember their name after the ink has dried on the contract.
  • Implementation services that focus on the plumbing rather than adoption
  • Training that doesn’t teach them how to fish
  • Non-intuitive user experience
  • To hear that they’ll have to wait a year for the next release to get that desired feature
  • To hear that their infrastructure that is causing poor performance.
  • To hear that they have to upgrade their windows platform, or upgrade to an enterprise version of Oracle to use the software
  • Support that requires them to run a server log to diagnose the problem.
  • Support staff that don’t understand their business.
  • Upgrades that are “free” as part of maintenance but end up costing cost nearly as much as purchase “because” of their customizations and deliver no tangible business value.

Mission critical applications can probably still get away with a poor user experience. Everywhere else the consumer revolution is chipping away at the enterprise software kingdom.  Edge Dynamics won when we had a mission critical application.  As soon as the market changed to a nice-to-have reporting tool, everything we had built became a liability – bad user experience, slow performance, costly upgrades, huge upfront investment, costly upgrades

Key Takeaways: Enterprise software vendors need to stand in their customers shoes and design a “whole product” experience, and total cost of ownership that is significantly better than the alternatives.

Sign Posts: What improvements would customers like to see to your sales process, implementation, training, and support services and to your product? What are the alternatives to your solution?

10 Years, 10 Lessons: Year 5: You Don’t Know What Your Customers Want

photo courtesy of clairity

photo courtesy of clairity

Keep talking to customers: you know you should

It’s one of the toughest problems in enterprise software.  It is really hard to find time to meet with customers and get quality feedback.  You have no choice.

When you’re launching a new type of product, its quite likely customers don’t even know what your talking about. At this point you have the vision and are hoping to deliver something useful enough that they’ll get it too.  In these initial stages, companies I’ve worked with talk to prospects initially to understand their needs and define the market.   Once you have something to address these needs, companies typically spend a lot of time with the first few customers getting putting the solution in place and training the users, and testing and refining Release 1.  This is good.   Its after this point, in the initial growth phases, when time and resources are strained that this discipline seems to just slide away.  Just because you knew their business better than they did at that point in time, doesn’t mean you’ll know it better from that point forward.

Every customer is different, and their business and their needs will keep changing. So you have to keep making the time to get the feedback.  It’s also the only way you will hear about new problems that may provide opportunities for differentiation.  While new web tools offer ways to facilitate interactive discussions without costly face time to improve and refine existing offerings, you will need to be on site, watching them work to spot the bigger opportunities.

At Edge Dynamics, we assumed we knew our customers after we had spent time on site with them through the first three implementations.  Around that time the market changed structurally.  We didn’t create a dialogue with our customers (once a year user group meetings are not a dialogue).  As we stayed in the ivory tower designing and pumping out ever more complex features, customers became overwhelmed with the feature set and started looking for something simpler.

Key Takeaways: Make time for customer interaction.  Keep your eyes open for structural changes, and opportunities for new products and differentiation.

Sign Posts: How do determine what customers need?  How do you involve the customer in the product design process?

10 Years, 10 Lessons: Year 4: Focus!

photo courtesy of ihtatho

photo courtesy of ihtatho

Geoffrey Moore was right about beachheads

After Year 3’s grisly topic we’re back to comfortable, less controversial ground.  Probably why so many forget this vital lesson.

It’s been said that to appeal to everyone is to appeal to no one.  Keen to win early deals, startups will jump at everyone who shows interest.  Engineers will want to build every possible feature. Opportunism dilutes your message and your solution.

Example 1. Perksatwork.com dominated its HR market.  As soon as we entered the general portal market we were done.

Example 2. At Edge Dynamics we religiously followed a Crossing the Chasm beachhead strategy with a single application in a single vertical.  We killed it until the market changed (more on this in Year 7).

Example 3. I watch a mobile social networking startup flounder because of a lack of focus.  Was it for college kids or everyone, a dating site or a provider of blinded phone numbers for classified ad postings?  Users were confused too, and growth never materialized.

I’ve also heard it said that VC’s believe: once means you got lucky, twice is a coincidence, and three times is a lock.  I’ll call these three examples my proof.

The benefits of focus are huge.  Every subsequent sale in a vertical market is easier (you have references, you speak their language, you know their business, why they bought, the value, the price, you have a contract template, services template, etc).  Your messaging and marketing materials can be tailored to their specific situation.  And your product will work.  You know the likely systems landscape, data and integration points.  Change the target audience and this all goes out the window.

Key Takeaway: Dominate your niche market before being distracted with other places you could sell.

Sign Posts: Which markets do you serve? What is your expansion strategy?

What Does A Meatball Sundae Have to Do With the Emmy’s?

You really don't want to eat one of these

You really don't want to eat one of these

If  you think you know the answer, you can skip to the final paragraph 🙂

After finishing the alt-mba (26 great business books in 26 weeks, more on that inspired idea another day), Paul Pettengill graciously sent the graduating class a signed copy of Seth Godin’s Meatball Sundae. Fantastic, I thought, another book to read! Turns out, I loved it.

As you know, Seth is a great marketer and prolific writer.  Dan and Chip Heath of Made to Stick fame, could have used Seth’s book titles to prove the value of “Unexpectedness”.

Having been and seen inside traditional enterprise software and pharmaceutical companies, I have strong anecdotal evidence to support the central thesis: you can’t just slap New Marketing (the sundae) on top of Old Marketing (the meatball) and expect results.  You have to either build a new organization from the ground up to support the new realities or just keep the traditional approach and accept the increasingly lackluster results in the face of the new reality.

Seth details 14 trends in the book, many of which you can guess at now (hey, it was written in 2007): increasing connection between consumers and producers, increased power of the consumer, need for authenticity, lack of attention, the long tail (must get Chris Anderson‘s book), outsourcing, infinite niches supported by search and addressed by more targeted communication (note death of mass advertising), increasing communication between consumers, shifts in scarcity and abundance, power of disruptive service or product ideas, inversion of the price/volume bell curve (be cheap or exclusive – just don’t get stuck in middle), and the rise of the new gatekeepers (bloggers).   It’s a thought provoking book – just consider alone the list of what was scarce (storage, bandwidth, international telephony, overnight shipping, airtime, information about other people) and what was abundant (spare time, attention, trust, natural resources).

This where the connection with the Emmy’s comes in.  The idea that traditional marketing is dying a long, slow death was captured by David Bianculli on Fresh Air yesterday when he observed the death of broadcast and the rise of fervent niche audiences for cable shows like AMC’s awesome Mad Men.  David brilliantly noted the accompanying death of the US car companies: in 2009 no one cares about either the new fall line up of cars, or broadcast shows. No amount of whipped cream and cherries will solve their problems.