Situation: A CEO is reviewing options for introducing a new offering. The target customers are small companies or projects within larger companies. The offering includes both an initial product and follow-on services. Education or training will be a component of the offering. What is the best way to roll out a business opportunity?
Advice from the CEOs:
- It is best to position the offering as a straightforward proposition at launch and develop proof of concept. This will provide experience and an income stream to fund more complex offerings based on the initial model.
- It will also provide insight on how to sell the product and service in different markets – manufacturing, service, and software.
- Leverage this experience to pursue more complex models.
- Build a portfolio of case studies before pitching to paying companies.
- Use companies with whom relationships already exist as the proving base. These will become references for new clients.
- Develop data to show actual cost savings from the use of the product and services.
- Establish a relationship with an existing company for which the offering is complimentary and cross-offer products and services on an ad hoc basis.
- Trial the product and service with one of their clients in return for a royalty or share of the profit.
- Ask that company to make the introduction.
- Target start-ups – offer an initial package for a low price. Offer the product to start-ups for free and get them hooked as long-term customers.
- What would be needed to roll the offering through growth equity firms or venture capitalists?
- This will require some proof that the offering increases the ROI to growth equity and VC portfolio companies and funds.
- Note that the portfolio companies of growth equity firms are larger and farther up the growth curve
- In current economy the key message to prospects may be that the offering will help them to “right size” their company.
- Take a closer look at the offering and determine whether it is configured appropriately for the current environment.