The Thrill of the (O)X Ride: 1st to Market - Wendy Dickinson

Wendy Dickinson - "Catalytic Conversation$"

Introduction:
More companies are started in economic downturns than at any other time.  We will know that COVID19 has created greater volatility, uncertainty, complexity and ambiguity than at any other time in our lives.

As I mentioned last week, tens of thousands of businesses have closed their doors.  It’s sad, frustrating, and shocking to many of those business owners.  As Bruce Feiler wrote in his article for HBR, “Managing Someone Whose Life Has Been Upended” (November 27, 2020), COVID19 has been a “lifequake”.

While this is that time of great upheaval, it can also be a time of innovation, disruption (of a positive kind), and for new beginnings.  Several of my clients have discovered that they didn;t know their customer or their numbers as well as they thought pre-COVID.

Others have used this time of recovery to explore new applications and upgrades for their products.  Another found that COVID stimulated interest in their new SAAS.  Today’s show is another opportunity for you to consider what’s possible, what’s feasible, as well as what’s desirable to your customers or clients.

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Show Objectives - Why This Matters

• There are advantages and disadvantages to being 1st to market.
• As Melissa Butler, Founder of The Lip Bar, said “I’m more comfortable with the idea of failure than with regret.”  
• How can your decision maximize your company’s returns and minimize your regrets?
• The definition of a first mover according to Investopedia is “a service or product that gains a competitive advantage by being the first to market with a product or service.”
• There is 1st to market in products, services, or as a woman, etc.  There are many kinds of firsts.  Each carry advantages, costs, and disadvantages.
• Determine the investment of time, energy, attention, and money.

The Problems You Face - Pivots & Pitfalls

• You risk your product being copied and sometimes, made better by, a competitor.
• Your competitor can capture your market share once you’ve established the consumer need.
• A competitor may be in a better position to take advantage of the 1st’s hurry to develop additional benefits or features that better align with consumer needs.
• It costs more to create than to copy.  Your costs must reflect what your consumers are willing to pay.  As Olivier Pomel of Datadog warns, being customer centric gives you a greater advantage - give your consumers control over their spend, allow them to share their challenges, respond to their sense of value.
• Does your culture support design, innovation, and falling forward without penalty?  Your company’s ability to reflect values, purpose and mission in its culture will have an impact on the success of your launch of your 1st.

What You Need To Know - Checking Alignment

• Advantages: 1st’s can establish market dominance which leads to customer loyalty, a set standard of quality, economy of scale, early exclusivity with vendors & suppliers, as well as control over patenting, branding & timing.  Sales force eager to sell new products and services to better serve their customers.
• Disadvantages: others can copy, gains can be made by exploiting the weaknesses of your product or service, it costs anywhere from 60-75% less to copy something than to create it.  Many salespeople are not willing to risk selling new products.
• Risk Aversion, Loss Aversion are both biases that can hinder a new initiative.  Company ecosystem needs to meet basic alignment with values, mission & purpose to gain buy-in for new products & services.  If company culture rewards innovation and design thinking is a part of the ecosystem, the rewards of 1st to market can be exponentially greater.
• The O/F cannot be the chief of sales and run the company at this stage of the growth & development, IF the company has reached size/sales of a Stage 4-6 company.

What You Need To Do - The Actions

• Know your numbers - roll out your dashboard.  Do that internal audit.  Establish a budget for marketing, customer research, development of the new product and service.  Forecast the costs, revenue, and overall investment of time, energy and attention within the company.
• Determine if that ROI is such that there is a return for shareholders and key stakeholders.
• Determine if you, the O/F, can lead the company and the launch.  Take off your Sales Manager hat and turn that responsibility over to another.  Train your sales people to participate in the customer research.  Train them to listen for new needs, problems and challenges in the lives and work of their customers.
• Create a team of people from across the organization to engage in the evaluation of the new product.  Set the standard for the market.  Set the standard for customer service and delivery of customer service.  Cross train others within the organization to use the service/product to gain buy-in.
• Teach developers, researchers, sales people, manufacturers to explain the product and how it aligns with the company’s mission, purpose and values.
• Teach your customers to be your ambassadors and advocates for your new product or service.

Resources:

1. “The Half Truth Of First-Mover Advantage”, by Fernando F. Suarez and Gianvito Lanzolla, HBR, April, 2005.
2. “First Mover Definition”, by Evan Tarver, reviewed by Amy Drury, Investopedia, September 28, 2020.
3. The Challenger Sale: Taking Control of the Customer Conversation, by Matthew Dixon and Brent Adamson, Portfolio/Penguin, 2011.
4. The New Leadership Literacies: Thriving in a Future of Extreme Disruption and Distributed Everything, by Bob Johnsen, Berrett-Koehler Publishers, Inc., 2017.
5. The SPIN Selling Fieldbook: Practical Tools, Methods, Exercises, and Resources, by Neil Rackman, McGraw-Hill, 1996.
6. “Managing Someone Whose Life Has Been Upended” by Bruce Feiler, HBR, November 27, 2020.

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