Innovation: Driven by Startups and enablers of Digital Transformation

There are 4 core enablers of the digital transformation that are key for today’s innovations and technologies. These 4 core enablers are:

  • Automation
  • Connectivity
  • Digital data
  • Digital customer access

In addition to these core enablers, there are interdependent / correlated enablers of course, i.e. cloud computing, adaptive manufacturing, autonomous vehicles, artificial intelligence, the internet of things, etc.

Leveraging these enablers lead to so-called Smart Products and Smart Services which heavily base on collected data (from Big Data to Smart Data), hence create an ideal Product-Market-Fit and at the same time accelerate innovation cycles and the competitive pressure.

A Smart Product can stand for very different tangible assets and therefore includes complex industrial machines and plants as well as privately used devices e.g. in a smart home and even your smartphone. Within the industrial sector, smart products (technical systems) are usually cyber-physical systems (CPS) that allow the coupling and coordination of computing power and mechanical elements. These products or systems typically “talk” to each other (machine-to-machine; M2M) and exchange relevant operational data, which they typically collect using different sets of sensors, and they can event (re)act on that data using actuators.

Smart Services are individually configured packages of (smart) products and services over the Internet. The focus is on private and commercial users. With the help of digital data from all areas, smart services are tailored to their preferences and situation-specific “as a service” to generate value-add. Digital platforms and marketplaces play a central role: Here, products and services are displayed virtually, combined, refined with additional digital services and offered as smart services.

A smart product typically ends up in a smart service, and both nowadays are mainly created / invented by startups. Not only since founding a startup has never been so easy – just take a look at all the crowdfunding possibilities – but also due to the importance of diversity and culture within a company: corporates typically do struggle with employee engagement and with their amount of hierarchy levels, which makes them very slow in becoming digital leaders:

DMM

Hence today, corporates do rely on startups, driving external innovation or by hiring from or M&Aing them, but also using accelerators, incubators and innovation hubs and labs to not doom in the digital transformation age.

Cheers,
Sebastian

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eSports – Boom!

Since eSports is one of the trendy business opportunities this year, let’s take a look at its potential today and in the coming years. The industry is still in its infancy with great commercial chances across several areas, such as:

  • Infrastructure / Hosting
  • Accessories / Merchandising
  • Betting
  • Training / Teaming-Up
  • Events / Tournaments
  • Streaming
  • and much more…

eSports report - statistics excerpt

In Newzoo’s 2017 report on the eSports market they predict growth rates of almost 36% CAGR till 2020 to roughly €1,3 billion globally. Well that’s not huge but don’t forget that the amount of market-players is rather small compared to other more mature, saturated markets. Following to the report, today the majority (51%) of eSports enthusiasts – that’s the frequent watchers – is in APAC, with a forecasted global audience growth of roughly 20% CAGR till 2020 to 589 million fans; thereof 303 million occasional viewers. An important metric in this space, like across the entire Media & Entertainment vertical, is the total revenue per fan. The US National Foodball League (NFL) – which is the most commercial league globally – generates €37,80 per fan. The average revenue per eSports-fan in 2017 is expected to be €3,15 and €4,50 by 2020. But there are big regional differences between Europe, NA, etc. So take a look at the entire report for more details:

To summarize some key takeaways, I would also like to bring in a few facts from Business Insider:

  • eSports is still a nascent industry
  • It is undervalued at the moment
  • Potential revenue streams are widely spread across the entire space
  • Traditional sport clubs have great opportunities to enter the market, although the markets/target groups differ
  • VR and AR companies are predicted to benefit greatly from eSports

If you are interested in business opportunities within eSports and/or eGaming, feel free to reach out to me. Same if you’re planning to launch an eSports/eGaming business or would like to discuss go-to-market approaches.

Cheers,
Sebastian

Reviewing IFA 2016 – Internationale Funkausstellung Berlin

Hi All,

I was joining this year’s IFA in Berlin as one the 240.000 visitors. It was a great show, and was pleased to see so many (young) start-ups there.

In fact, IFA had 13% more exhibitors than 2015, and was the biggest IFA ever – at least from an “amount of exhibitors” point of view. 1823 companies generated a (potential) order volume of € 4,5 billion (for the digital natives: that’s the number when you have to flip your smartphone over to make the calculator except such a huge amount of digits ;)) – anyways, on average that’s € 2,5 million in revenues per exhibitor…theoretically…

What where the hottest topics:

  1. Virtual Reality – honestly…all over the place
  2. TVs …TVs…and more TVs…yes very smart ones of course
  3. Drones..in several flavors…and they performed great artistic air shows…
  4. Smart homes…and connected devices….
  5. …the rest where all niche products… -> but check out my next blogs on more of those niche vendors…

…and of course I will also do a review of latest VR and smart technologies, besides looking at some smaller start-ups’ technologies…

Stay tuned…

Cheers,
Sebastian Grodzietzki

Lead Qualification 1×1

Today, we would like to focus a bit on the customer acquisition process – specifically we want to discuss you can improve close rates by high quality leads.

Lead management is the one piece, but without a great product showcase, presentation/sales assets, and the emotional connection to the customer, we will not close sufficient opportunities from the pipeline. (leads-to-sales ratio vs. leads-to-close ratio). So, the overall sales cycle phases, the used assets, the demo experience, and the people (presales, sales) which perform the sales pitch are of utmost importance, of course. But let’s focus on higher quality leads as input and not the outcome for now.

Since the lead qualification in many companies is still done by sales teams instead of demand gen or marketing teams, we might need to look at the skills of current marketing and demand gen colleagues internally to brief them thoroughly on a marketing lead qualification strategy. We might need to introduce a more stringent target customer profile specification inside the marketing funnel, so a filtering/segmentation happens in a secure way, and only the hot leads are handed over to sales teams, into the sales funnel.

This could also introduce a risk though because the amount of total leads which are with sales teams will decrease, and without closing better over mid term, the company might lose chances and revenue. Another risk might be that such a change from a scattergun approach to a tighter focussed lead approach might lead to a reduced pipeline size in some regions, and so sales reps could be starting to take much more of their time for lead generation (i.e. of net new names) themselves, and so they would be able to spend less time on customer intimacy which makes future up-/cross-sells more difficult, besides some other challenges. Hence, if the sales strategy leverages up-/cross-selling heavily we need to be specifically careful during the transition period, and also look into the opportunity management strategy.

This being said, to allow higher quality leads which are handed over to the sales teams, we need to:

  • Analyse and rethink the stages in the marketing and sales funnels:
    • what stages do we see,
    • which flow leads to fastest closing,
    • what stages need to be passed before handing over to sales teams,
    • execute lessons learned to uncover best practices,
    • etc.
  • Try to automate certain stages, actions and steps inside the funnels, like showcase/demo access, test system access, etc.
  • Decide on thresholds and indicators of stages, revenues/opportunity sizes, industries, etc. which proved to identify a typical (fast) closing deal
  • Pick events and actions more selective, be more focussed
  • Execute professional opportunity management by sales teams (incl. global key account)
  • Address buying centers more specific with potentially different value props than in current marketing and sales assets
  • Check and adjust partner go-to-market approaches
  • Create/execute onsite and online user group events
  • Spent more time on alignment and lessons learned across all stakeholders and regions
  • Etc.

Please reach out with any questions or comments.

Cheers,
Sebastian Grodzietzki

TOP GROWTH MEASURES – A FOLLOW-UP

Hi,

I hope you enjoyed our past weeks of growth insights.

I wanted to quickly add: What else should be in focus to achieve growth:

  • Set the right targets / make them a challenge
  • Recognize the top performers / make them feel like winners; they need to stay
  • Have a clear, easy to understand market positioning with strong USPs
  • Have a bold vision and mission
  • Ship non-disruptive product innovations / aim for “zero” maintenance downtime / make upgrades easy and fast to adopt by all users
  • The product roadmap should be strategic – mix of market/business and existing customers needs (what can be sold vs. what reduces support tickets?!)
  • Bundling and packaging with own and 3rd party solutions in a creative way
  • Pricing: are we compelling? Could we be more expensive? Which models and options would increase total revenues per customer lifetime (up-/cross-sell)? Bundle prices? Reseller models? …
  • Service portfolio: what do we offer in consulting, training, coaching, support? Enterprise customers, standard vs. premium offers?
  • Internal enablement: do we know and are we doing what/how we should? Best practices? Employee onboarding, updates, briefings (new releases, new sales assets, etc.), shadowing, lessons learned, …

Happy to get your thoughts.

Cheers,
Sebastian Grodzietzki

TOP GROWTH MEASURES (5/5)

Hi All,

Welcome to our final blog on growth measures.

This time we want to discuss:
5. Build a world class inbound marketing team that is viewed as a value-added partner by colleagues in the Sales and Product organizations.

A leading edge inbound marketing team requires experts specifically in SEM/SEO/SEA, affiliate marketing, PR, social media marketing, content marketing, and media design.

The team should have a good understanding of technology and needs to be able to transform/explain/promote features in a way that exposes the business value, customer advantage and benefits instead of just listing the pure product features itself. Creativity and humor are other key attributes of each team player to tease the outside world and make the entire globe eager to get in touch with us and use our products. We would need at least one modern, and a little bit crazy, media designer for the visuals within all marketing/sales assets.

Also Thought Leadership topics need to be actively driven to provide more than only insights into products – a visionary mindset, and a will to share is another very important asset of that team.

Needless to say that the team should have a great social media footprint with a network of multiplicators in press, at analysts, in the blogger scene, etc.

Last but not least, they should all be great team players, open-minded, and have the right sense of business acum to understand their individual impact to the company’s business.

Please reach out with any thoughts!

Cheers,
Sebastian

TOP GROWTH MEASURES (4/5)

Hi,

Here we go with week 4 of our growth discussion.

Today we want to discuss:
4. Develop a dashboard populated with a set of KPIs that are used to monitor, improve and report on business, growth and marketing performance.

Well, to do so, we should not only look at the marketing funnel but have the sales funnel and related KPIs on our monitoring as well. By the way, I would also recommend to have regular field meetings to update sales/country managers and sales reps on latest marketing campaigns, assets, upcoming events, etc., so everyone is aware and can make use of that to reach out to customers, partners and prospects.

To the point on KPIs for the business growth performance, we should look at the following figures, which are not a complete list though – please also refer to question no. 1 above:

  • From a strategic/tactical point of view:
    • Current revenues and projected revenues for month/quarter/year end
    • Correlation of marketing budget to revenues and margin
    • Correlation of increase/decrease of marketing budget to revenues
    • Customer, partner and employee retention rates
    • Net Promoter Score
  • From an operational point of view:
    • Social media reach, subscribers, lurkers, contributors, etc.
    • Upcoming events, actions with planned targets on leads, and conversion
    • Current amount of opportunities/leads (per stage) in pipeline per region and sales channel
    • Current amount of customers/partners, with revenue averages – also per industry; what are our top customers/partners (opportunity management)?
    • Amount of success stories, and reference customers
    • Sales cycles and stages lengths
    • Win/loss ratios, how many deals closed from leads (with and without competition)
    • Competitive statistics – competitive and market intelligence
    • Average opportunity/lead sizes per region and sales channel
    • Pipeline vs. target-revenue-delta ratio per region, and expected end of quarter/year revenues
    • Top documents/assets downloaded or accessed (internally and externally)
    • Website access statistics, inbound links, page rank, etc.Those performance facts and indicators should be regularly discussed within a group of stakeholders – at least quarterly -, and a RAG (red, amber ,green) analysis against defined thresholds/targets should be made -> all red and amber accountable owners need to provide clear planned measures to solve the issue within the next 6-8 weeks.

Cheers,
Sebastian Grodzietzki

TOP GROWTH MEASURES (3/5)

Hi,

This is week 3 of my growth blogging series.

Today:
3. Stimulate growth within new and existing customer segments through higher brand awareness, reduced churn of existing customers, and dramatically higher levels of customer satisfaction, delight and advocacy.

Winning net new names requires different approaches and is between 4-9 times more difficult (depending on the research you look at) than up- or cross-selling into existing accounts. Penetrating the market and winning market share from the competition as well as growing in the installed base, have some things in common though. And this is ultimately the product quality – incl. innovative and useful/beneficial feature sets which really solve business issues, ease-of-use for faster user adoption of our products, and maximized return on investments, plus lower total costs of ownership and implementation, and some other solution delivery specific parameters.

Brand awareness could for instance be driven by corporate social responsibility (CSR) initiatives, (funny) viral and social marketing campaigns, and the introduction of topics/products within schools and universities, like free-of-charge product access or elder product versions. Such and other broad measures would assure to be known outside the box and our brand would be understood to be valuable for the entire world, and not only for selective jobs. Companies – people! – would be instantly reminded of us when they might have an appropriate need.

A reduced churn of customers, and higher customer happiness can best be driven by product quality and a highly professional service and support infrastructure/organization. What the sales teams promise and sell, and the product finally does needs to go hand in hand. The product usability and feature set, as well as the response time and provided help when needed (by service/consulting and support teams), must be market leading to keep customers with us, specifically in a cloud/SaaS business, and get prospects convinced when executing proof of concepts.

It’s very useful to make surveys to understand from customers and partners what influences their buying decision, and what product improvements they would like to see…take that, make some nice market messaging around that, collect product/feature requirements from the market/customers/partners and ship them to create the market leading solutions…this will also drive attention among analysts and helps to be recognized for awards. Such awards are specifically helpful to create brand awareness in North America, the United Kingdom, and the Asia, Pacific, Japan regions.

Also methods like MOOCs and social online learning rooms offer great toolsets to stay connected to the market and to existing customers – moderators, admins or bloggers, such as business development and demand gen teams can influence target groups easily and get feedback at the same time. Of course there is even potential for service and support groups to leverage such online communities to help/enable customers. Also partners have great ways for self-enablement (incl. how to sell). Education, such as product trainings, could become more and more a low-cost, maybe free-of-charge topic which customers and partners can access online. This also leads to a great value prop and drives excellent brand awareness in the market, to scale the business.

Looking forward to next week and to get your thoughts.

Cheers,
Sebastian

TOP GROWTH MEASURES (2/5)

Hi All,

Welcome to week 2 of my growth blog series.

  1. Dramatically enhance the customer acquisition process, with a concentration on improving close rates through higher quality leads.

Lead management is the one piece, but without a great product showcase, presentation/sales assets, and the emotional connection to the customer, we will not close sufficient opportunities from the pipeline. (leads-to-sales ratio vs. leads-to-close ratio). So, the overall sales cycle phases, the used assets, the demo experience, and the people (presales, sales) which perform the sales pitch are of utmost importance, of course. But let’s focus on higher quality leads as input and not the outcome for now.

Since the lead qualification in many companies is still done by sales teams instead of demand gen or marketing teams, we might need to look at the skills of current marketing and demand gen colleagues internally to brief them thoroughly on a marketing lead qualification strategy. We might need to introduce a more stringent target customer profile specification inside the marketing funnel, so a filtering/segmentation happens in a secure way, and only the hot leads are handed over to sales teams, into the sales funnel.

This could also introduce a risk though because the amount of total leads which are with sales teams will decrease, and without closing better over mid term, the company might lose chances and revenue. Another risk might be that such a change from a scattergun approach to a tighter focussed lead approach might lead to a reduced pipeline size in some regions, and so sales reps could be starting to take much more of their time for lead generation (i.e. of net new names) themselves, and so they would be able to spend less time on customer intimacy which makes future up-/cross-sells more difficult, besides some other challenges. Hence, if the sales strategy leverages up-/cross-selling heavily we need to be specifically careful during the transition period, and also look into the opportunity management strategy.

This being said, to allow higher quality leads which are handed over to the sales teams, we need to:

  • Analyse and rethink the stages in the marketing and sales funnels:
    • what stages do we see,
    • which flow leads to fastest closing,
    • what stages need to be passed before handing over to sales teams,
    • execute lessons learned to uncover best practices,
    • etc.
  • Try to automate certain stages, actions and steps inside the funnels, like showcase/demo access, test system access, etc.
  • Decide on thresholds and indicators of stages, revenues/opportunity sizes, industries, etc. which proved to identify a typical (fast) closing deal
  • Pick events and actions more selective, be more focussed
  • Execute professional opportunity management by sales teams (incl. global key account)
  • Address buying centers more specific with potentially different value props than in current marketing and sales assets
  • Check and adjust partner go-to-market approaches
  • Create/execute onsite and online user group events
  • Spent more time on alignment and lessons learned across all stakeholders and regions
  • Etc.

Cheers,
Sebastian Grodzietzki

TOP GROWTH MEASURES (1/5)

Hi,

Welcome to week 1 of my top growth measures blog series:

  1. Build an innovative, scalable and low-cost demand generation model – one that is eventually recognized in the industry for delivering 2x performance of its nearest competitor.

In general: to put an integrated growth strategy into place, and to aim for overachieving on given objectives, we need to uncover the status quo first – the weak and the best-run company products/markets – on global and regional level, and across all sales channels (direct, partner, inside, eChannel). We need to look into current KPIs throughout the marketing and sales funnels, and define new key KPIs where needed.

So, a route to success could be:
1. Get insights into the status quo: what is done today and how, what works and what doesn’t?
a. What is the typical customer profile, and how is the pipeline being created?
b. Use very detailed pipeline reports (please find more details below) to identify the high and the low performing products/markets.
c. What events/actions are used to generate demand and business today?
d. Look into current collaterals, like whitepapers and the customer presentation, and check the website (SEM/SEO/SEA) incl. traffic statistics.
e. Where are target/customer communities? (Social and affiliate marketing)
f. Are latest assets and messaging used or old materials?
g. What value prop and design is used?
h. What about returns from self-service/inbound-marketing?
i. Etc.

Replicate, align, and further improve the successful demand generation measures across other regions. Make sure everyone uses the latest, official   messaging and assets, messaging needs to be value driven and compelling instead of feature-heavy lists.
2. Define KPIs and other measures in an open demand generation/go-to-market plan initially once a year, and monitor the execution and success biweekly or monthly, to update the plan when and where required, i.e.:
a. Number of total opportunities per region, incl. detailed insights across direct sales, OEMs, VARs, SIs, eChannel, etc. / what’s the share across different sales channels and where should it be?
b. Ticket sizes segmentation per unit from above for better pipeline guidance:
i. Small, medium, large deals
ii. Industries/segments
iii. Personas/customer target profiles
iv. Partner segmentation

In which segments will we aim for volume, and what are strategic/key segments with special attention and measures?
c. Amount of events/actions per region / later: align on topics globally to avoid all regions create from scratch, which customers to speak?, how many leads to expect?, …
d. Etc.

  1. Understand deal closing rates vs. pipeline to allow quarterly/annual projection of expected revenues and required business development and demand generation needs – ratio of closing from pipeline should be better than 2,5x (= need €250m in pipeline to make €100m revenues)
  2. Identify (new) target regions/market units and nominate local business development/demand generation owners – single points of contact. Assign/cascade KPIs to them to drive success.
  3. Set up a schedule of market communication and define a social media strategy (# of newsletter per quarter, # of twitter messages, # of cold calling-action days, # of onsite and online events, # affiliate activities, etc. incl. required conversion rates).
  4. Check, update and align regularly on global and regional level with biweekly or monthly calls across different stakeholders.
  5. Get input for demand generation activities from several stakeholders, i.e.:
    a. Product owners should define key value statements for the product (like new release, new success story, etc.) per month, which could be used for website, blogging, twittering, events, webinars, press releases, etc.
    b. Global and regional demand gen/business dev teams align on corporate messaging input.
    c. Do regular meetings with analysts and strategic partners to get input and make use of their network for pipeline acceleration.
    d. 1:1 Email templates could be provided on regular basis to all sales teams which they can easily send out to prospects and customers/partners to stay in touch.
    e. Etc.
  6. Involve sales teams and other stakeholders to get new reference customers, testimonial videos, get customers to speak on events, etc.
  7. Drive viral marketing campaigns with engaging content, incl. special offers and promotion; ideal for cloud-based products and the eChannel

10.Reach out to schools/universities and drive (early) awareness initiatives across students for the company’s famous products (provide free-of-charge software and/or knowledge transfer)

11.In general, we need detailed data to allow demand gen and closing rates to be steadily growing (also refer to no. 2 above): we need a detailed regional pipeline report across all regions and all sales channels, with
a. amount of opportunities,
b. average opportunity sizes,
c. amount of opportunities per stage across marketing/sales funnels (5-7 stages from “new” to “booked”)
d. stage and sales cycle duration,
e. win/loss ratios,
f. current revenues,
g. executed events and success (leads, conversion, etc.),
h. top running industries
i. best performing sales reps (drive lessons learned)
j. best performing presales reps (drive lessons learned)
k. etc.

Let us know what you think.

Cheers,
Sebastian