Easier said than done!! I attended a panel event that discussed exactly this challenging topic – the panel included Aaron Finn (Adready.com & classmates.com), Len Jordan (VC), Todd Sawicki (lookery.com), Yannis Dosios (smilebox.com) and Shirish Nadkarni (livemocha.com). This post has my perspectives on some of the key takeaways from this discussion.

It reinforced my belief that product marketing should be a part of product planning and not an afterthought when approaching the release date. This post covers aspects of product development, customer acquisition and retention

1. Value exchange: If the product involves a registration process (linkedin, facebook, etc) make sure that the process is as simple as possible or ensure a “value exchange” to give the user an incentive to go through the registration process. Example: www.classmates.com would usually ask the user for personal data first and then follow this up with a question about “the school you went to”. As an experiment, the process was reversed – first ask the user about his/her school
à present value using the data just filled: “there is XX no. of your classmates you can connect to” and then offer to exchange this by asking the personal data. This “value exchange” created a quantum jump in the conversion rate of the people who landed on the registration form. The key is to keep an eye out for what works and what doesn’t. Keep experimenting .Also make sure that you have instrumented the analytics to measure the effect of your actions/experiments

2. Niche and branch out: Sometimes it makes sense to focus your first release on niche segments instead of a big bang mass market approach .An example of this approach – RealNetworks in its first online audio venture(late 90′s)focused just on getting out voice quality (not music quality) grade production. This worked for the niche audience for whom “online radio news” was a need and could access the news station of their choice anyplace. Amazon’s initial focus was just on “books”. Both RealNetworks and Amazon have branched out to multiple segments after their initial success in the niche segments. An example of a product still in the niche stage is www.retrevo.com which is a search engine focused on the niche audience – “buyers of consumer electronics”.

3. Let them evangelize: If your product has a premium paid service – make sure there is enough to wow the customers in the free version. Build your product in such a way that the customers can evangelize it. Examples, now taken for granted,” email this story to your friend”, “share this video”, “Digg” this, “Did you like this card – do you want to share this with someone else”, etc.

4. Distributables: Build useful “distributables” that can link back to your site. Make sure that these are simple to distribute online. One example of this can be seen in the way Yahoo distributes its airfare meta search so that bloggers and other travel related websites could add it to their site. A click on the search button would take the users to the Yahoo air-fare results page.

5. Downloadables: It’s debatable on how effective downloadable desktop clients are. Some products are web only; some can be download-and-use or can be a hybrid of both. You need to have the right balance for your product. Smilebox’s Yannis said that about 50% of the users dropped out when they encounter a downloadable executable in the process. On the brighter side, there are some advantages of having a desktop client as a part of your product. The customer does not have to recall & type your website. You have a share of his/her desktop. This in itself is like building a minor switching cost and shields against the competition from stealing him/her from you. Below is an example of widget from Yahoo Travel that sits on the users desktop.

6. First 100 users: Once you have built, hopefully, what is a compelling product; evangelize it with your friends and family. This includes relatives, common friends, posts in your alumni networks etc. This should help the user base reach the 100s. Make sure your product has a good “viral co-efficient” (defined as “the number of additional members a new member brings”). Here is a link that talks about increasing viral co-efficient

7. The next 1000:The next level of growth can be from bloggers, SEO and SEM – follow some of the prominent bloggers in your area (including techcrunch) and build relationships with them by having genuine interest in what’s covered in the blog, contributing to it (comments,etc). A positive mention in the blogs could lead to a considerable increase in traffic. No one discounts the value of SEO and SEM. Some free resources on SEO can be found at (www.seomoz.com). But as a general rule make it easy for users to create incoming links to your site. There is a temptation to create a great “look and feel” by having a lot of flash but remember that this prevents the discovery by search engines, so use them judiciously. Smilebox’s Yannis believed that a combination of SEM+SEO (i.e. the link appearing on the sponsored and general search) has been very effective for Smilebox.

8. Personalization and game behavior: Personalization can be a great asset in retaining users.”My Yahoo” was a great success in spite of a huge proliferation of news sources/aggregators because the user spent more than 3 minutes in configuring the settings that suits him/her. Having done this the user has a great affinity to coming back to what was his/her setup/creation.
Also incorporating competition or game behavior in mundane activities can be a great source of engagement. Livemocha (www.livemocha.com), which is an online place for learning/teaching languages, incorporates game behavior for the interaction between teachers and learners.

9. Market place networks: These are networks/communities that have two user groups with different goals -buyers/sellers, contributors/readers, teachers/students, job-hunters/recruiters, etc- it’s important to move two customer acquisition needles and treat both of them differently, with equal priority as both are equally important to the success of your online network.

10. Acquisition cost: If you are a pure free service (i.e. intent to make zero money from the user/consumer) the cost of acquiring the consumers should be as less as possible (close to zero) Todd of www.lookery.com argues that for such products the focus should be to build a very high viral co-efficient in their product.

Product Management, surprisingly, is not a course offered in any of the schools, Business or engineering, and its one of the most important roles in the building great products. Over the past two days I was lucky to attend a two day course on product management by Marty Cagan of the Silicon Valley Product Group (www.svpg.com). I would highly recommend this course to anyone interested in the “art” of Product Management.

 I am capturing some thoughts from the course. Disclaimer: These are fleeting “takeaways” and its only fair not to talk about the details of the course here – you still need to attend the workshop to get the full value of the course. 

“Very rarely are companies late” – there is always a debate on if a market/service is well served – is there a space for yet another product here? E.g.: Google entered a market where there were quite a few search products through altavisa, lycos, etc. Ofcourse, the exceptions to this rule is product spaces that involve huge network effects like social networking and other community products – classified, etc where a better product entering late may find itself difficult to break in.

“Don’t delegate to customers to tell you what they need”

“Customers don’t know what’s possible”

– In essence don’t base your product requirements purely on customer’s *called out* needs.

“Users give you credit for what they can use” – you may develop a product with lots of different features – but if they cannot be discovered by the user easily they are hardly of any use. Discoverability and desirability are the key.

“Improve a product enough and you may eventually ruin it” – guess sometimes PM’s end up adding newer features almost to justify their presence – you may end up increasing the complexity of the product.

“Ugliness is OK but usability is key” – this was made in particular reference to the success of craigslist.com which is not a visually appealing site (but actually a very easy to use site)

“Make sure the ecosystem is ready for your idea” – youtube would have failed if it had launched, say, 2 years before. It was the broadband penetration ecosystem that propelled its success.

“User experience Vs Ease of building” Always user experience wins. Essentially stick to a great interaction concept even if you have an alternate interaction that helps you launch quickly.

“Your customers leave you more often when *you* do something badly than what someone else does great”

“Failing fast is better “- never underestimate the importance of concept testing your features with you target consumers through dummy products/mocks before the development process

“Don’t do a feature death march on engineering” – give them enough bandwidth to stabilize and improve the performance/stability of the current product.

“You don’t get a second chance to make a first impression” you can read my post on landing pages.

Obviously there was a lot of discussion around product requirements, release planning, concept testing techniques and more – I will leave you to attend the course to learn about that.

Some book recommendations.

 “Inmates are running the asylum “by Alan Cooper 

“Don’t make me think“by Steve Krug

The subject may sound a little bizarre – but it certainly is something to think about. Can the introduction of the iPhone – a phone ( + music player) have any effect on the market share of Vista – an OS running on desktops and laptops – my guess is Yes and a negative effect IF apple gets its act right. The announcement that iPhone will allow 3^rd party applications is small step in that direction:

http://www.pcmag.com/article2/0,1895,2150858,00.asp

Firstly, let me emphasize this posting has got nothing to do with the iPhone (there are millions of articles already) – it’s more about Windows and the Mac Platform.

A quick analysis of the commercial OS/platform current market share – Mac 5-9 % , Windows 88 % – 95% – shows windows as a clear winner. Windows is a big winner among the consumer segment although Mac, in my view , is a more intuitive  OS.

One of the Big reasons why the Mac has been a failure (rather not as successful) are the ecosystem concerns and rightly so: “ Will those apps work on My Mac”,” I have to wait for ages before they build a Mac version of that game”.

Let’s think from the application developer’s perspective: the sweet spot is the windows platform – you have already targeted 80% of the market if your app works for the windows platform – why bother about the Mac.

All that can change – and possible is set to change – if iPhone allows 3^rd party applications. If things go as expected the iPhone will end up being a huge success. No developer/company developing apps for the mobile world can ignore the iPhone . This would mean they would need to develop apps for OS X, and now that they know the SDK for OS X and you are essentially increasing the army of developers for OS X.Which is why the initial announcement in Jan that iPhone will Not be open for 3^rd party apps was shocking. http://blog.wired.com/gadgets/2007/05/steve_jobs_ipho.html

There was a small breather when it was announced that web based un-installable apps will be allowed http://www.tuaw.com/2007/01/10/apple-vps-confirm-no-3rd-party-iphone-apps/ . This is a step in the right direction but still not enough.

Apple quotes that its developer community is about 1 million – a great way to triple that will be to open the iPhone and develop a certification program just the way Symbian (the platform used by Nokia) did in 2004 http://www.phonescoop.com/news/item.php?n=864 This is sure to have a ripple effect on the number of apps built for the Mac and the rate at which windows only apps will be tested/tweaked to work on the Mac OS X.

So will the iPhone kill Windows – obviously No – Microsoft is too smart a company to allow that to happen – but it is sure to cause some dents in the market share 3- 4 quarters from now.

Most of these internet cafés charge as less as 20 cents per hour (Rs 10) – to survive these low price point they use old PCs (typically with Win 98) and a default screen resolution of 800*600.

This screen resolution significantly affects the way you plan your feature/layout of your website. Consider the following website as seen on the 1024* resolution

This is the same as seen in an 800*600

Notice the perceptible loss in information on the right side and the bottom of the page.

The second key element is the mouse pointer area in hyperlinks. In most emerging markets the optical mouse is still not popular – the good old roller ball mouse is still prevalent.

 Given the accuracy and easy of use of the optical mouse as a pointing device, designers tend to have smaller hyperlink areas – this sure to cause some paint points in the website usability.