Although I spend a fair amount of time in this blog talking about things that fall squarely in the marketing domain, the Tech-Go-to-Market team (and me in particular) also covers product strategy and that’s where I want to focus this post. While technology and service providers have an extremely large number of challenges (some of them existential), one of the ones that I regularly observed in my fifteen years as a product marketer and more recently as a Gartner analyst is one related to future growth. Figuring out the path forward, the “next act,” particularly in light of constantly evolving markets, buying cycles, and technology disruptions (like the Nexus of Forces) is something that keeps senior executives up at night.
Here at Gartner, we spend a lot of time thinking about, writing about, and advising on future trends. When those trends get amplified in the press, in the social media world, and the speaking circuit, they often take the form of “bright, shiny objects” that draw the attention of providers. In an environment where we deal with sensory overload, we are drawn to these objects like moths to a light. While the light and luster will fade from many of these trends, nearly every tech executive has been burned at some point in their career, by the “Great White Buffalo” or the one that got away. Not only did the Great White Buffaloes cost their company, but they probably had a negative impact on the individual, financially and/or professionally.
Some of these bright shiny objects do ultimately “have legs” and the providers that capitalize on them will be better positioned for success than the ones that don’t. So how do you know which ones have legs and which ones don’t? That is the $64,000 question. But it’s also one that is impossible to know with enough certainty that you eliminate all risk, at least if you want to know early enough to capitalize on it. But you can certainly look at our research, talk to our analysts and do your homework to see if you think if it’s worth considering for investment.
But providers often err by only considering whether the bright, shiny object is worth chasing. They don’t look at the potential cost to their current business (and customers) and the implications on the competitive dynamics within the current market. There are plenty of ways to address total available market and total addressable markets when looking at new opportunities, so I won’t go into those here. But whether you are looking at completely new offerings, re-architectures, or delivery model changes (among others) there are some less obvious things that have to be part of that equation including:
- Unless you are planning to seek new funding (and this is not only development, but also marketing and every other function that will be involved in any significant way), to go after the bright, shiny object, what is the opportunity cost for your current business? Moving development resources to the new effort will mean that you will have less resources available for your current solution, which can impact growth rates. Fewer dedicated marketing resources can also impact revenue either through lower demand or less than optimal sales enablement.
- What is the specific downside risk to your current customer base if they see less focus and innovation for the current solution? What percent of those customers are currently at risk and will that increase churn? Are your other customers that are currently happy, but might become unhappy over time given the lack of innovation? Will you lose references and advocates and how will that hinder growth?
- What are the competitive implications? Will your competitors be able to spread fear, uncertainty and doubt (FUD) about your commitment to the current solution? Is there a chance that the narrative will make its way to influencers and amplify that effect?
Newton’s third law of motion is “for every action, there is an actual and opposite reaction” and the principle can apply equally to business. Every action you take has the potential to cause some kind of reaction and too often, providers simply ignore this principle when chasing after the bright, shiny object. This happens frequently when a provider chooses the “build” route in pursuit of that object, but even more frequently when they opt for the “buy” route. Acquisitions, particularly significant ones, have a tendency to give customers heartburn, which can only make the unintended reactions that much more severe. Customers are extra-sensitive to the signals and the optics of their providers after an acquisition and the business case needs to account for this concern. If it doesn’t, competitors will take full advantage.
I don’t mean to argue that you shouldn’t ever evolve your product strategy to take advantage of the promise of the bright, shiny object. This tends to be a requirement for achieving long term, sustained success. But when you are building the business case, you have to account for all of the potential downsides and make that part of the strategy discussions. If you choose to go forward, you also need to have a plan in place to mitigate that impact and that plan needs to be much more than just reassuring words. Your customers aren’t likely to be fooled and if they are , it won’t last for very long.
Executives (or board members) can get fixated on the bright, shiny object. As a product marketer, you sometimes need to act as the voice of reason and makes sure everyone is aware of the downside risk (using modeling and data to demonstrate the implications) before signing off. This can feel like swimming against the current, but product marketing can be a lonely job sometimes. (That should always be in the job description!)
While you definitely don’t want to look back and say that you had the Great White Buffalo within reach and you let it get away, the moral of the story is that the Great White Buffalo isn’t always the bright, shiny object, but maybe the dull, boring object that you already have. If you let that one get away, it will feel much, much worse.
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