In this week’s episode of Growth Interviews, we invite you to join our podcast conversation with Andrew Salzman, global market development and growth strategist with over 20 years of experience and a proven international track record of leading change and developing markets for top companies, worldwide.
Welcome to Growth Interviews!
Welcome to Growth Interviews, the fun, stimulating and engaging series of conversations driven by digital business growth. Our mission is to provide valuable insights from the eCommerce arena, and each episode is a fascinating quest into the best-kept business secrets and money-making strategies of an insightful world-class expert.
Andrew Salzman is one of the most insightful experts who provides companies seeking transitional or transformational growth with the market and customer-based insights to ensure product-market fit and aligned cross-functional execution. He specializes in market development strategy, strategic planning frameworks, marketing and sales planning, messaging and brand architectures, product portfolio and direction, channel strategies, go-to-market planning, sales enablement, product marketing, and lead generation.
An expert with lots of experiences to share, Andrew Salzman worked with innovative technologies including AI, Cloud, IoT, Big Data, Mobile, & Social Media across industries like enterprise hardware – software – infrastructure, cybersecurity, healthcare, financial services, cleantech, storage and networking, social media, talent management, and consumer tech software/hardware. Now it’s time to sit for one of the greatest marketing lessons.
Here are the biggest takeaways from the interview:
- Points of view on the digital landscape – 01.25
- Challenges technology changed – 02.52
- Product market fit vs. channel market fit – 04.53
- Principles of starting a digital business – 18.35
- Lessons of success – 21.35
- States of company development – 25.28
- AI and Machine learning – 34.55
Product-market fit vs channel-market fit
“Is there is a real product-market fit?”, as he told us, is the first question that Andrew Salzman is asking companies. The answer is the starting point of working together.
The markets are always in a state of change due to technological development, with totally new frontiers opening up. Entrepreneurs really need to be aligned with solving a significant need or problem potential customers have or might encounter and they need to understand if the potential customers – the potential market – is really recognizing the problem.
The second most important problem in the process of setting clear expectations regarding the first step in the process of product-market fit is if the potential customers are motivated to solve that problem and also willing to invest in a product or a service that helps them solve that particular problem.
Going further, the third question in line coming from Andrew Salzman is “If you were to create a solution for that problem, would they buy it from you?” Establishing credibility as a provider in the market is one of the most important steps, if not crucial, and it is an aspect that should be measured before everything else. The capacity of being a trusted partner a company shows and proves is one of the most important assets an entrepreneur might have.
“Can you build it?” is the fourth question and it refers to the capacity, resources and knowledge an entrepreneur has in order to create and launch a new product, service and even a new business.
The process seems simple but is more than often very complicated to answer all the questions without raising serious issues. The first three questions are asked before actually building something. And in many, many cases, the process is the inverse. An entrepreneur, for example, has an idea about an interesting new application or new technology and he goes directly to building it and in many cases launching it because he considers it to be a great product that for sure will be loved and therefore successful in the market. Unfortunately, emotional decisions based on personal preference towards a solution are the ones that failed the most.
As an expert, Andrew points out that need is what any entrepreneur should have in mind when building products, tools or services. “The best products that I’ve seen introduced into the market started with an entrepreneur who had a problem in their own life and developed a solution to that problem and that problem for that entrepreneur was a common problem shared by a number of different people. And the first step for product-market fit was identifying what I call visionary early adopter buyers who tended to be more upscale and affluent and who had the confidence to work with newer technologies.”
Channel-fit comes much later when product-market fit questions have already been answered and Andrew mentioned that there is a nine case criteria to complete a channel-fit process. “Those nine criteria are points of success. They can also be viewed as points of failure. And if we look at those nine key prior priorities of criteria, only one is the product.”
The first and most important criteria is the target market and it comes with a great question “Is there a customer in pain who recognizes that pain and wants to solve it?” The second criterion also comes with an important question, “Is there a compelling reason to buy or a compelling reason to switch or to argue about how one approaches a problem.?” The third criterion of channel-fit is the product and identifying all the elements in addition to the core product that are needed to solve that problem.
During the channel-fit process, the first three criteria are the most important to solve and the only one an entrepreneur has full control on. After that stage, there are six other variables that a company can’t control fully, including partners and allies, sale strategy, pricing strategy, competitive environment, positioning and the last, which is the next target, meaning the adjacent segment to go after the first stage. This set of six criteria helps entrepreneurs sharpen product-market fit amongst a range of potential options that may exist for a product and ultimately paves the way for starting to get significant and meaningful market traction.
Principles of starting a digital business
Business is based on economical laws that will never change no matter the environment of the business, online or offline. In the interview, Andrew considers that “certain principles don’t change. People are people, there are needs, there are problems to be solved.” What changed and is in a process of permanent development, like a living organism always evolving, are the techniques and methodologies that specialists use to solve those problems. The digital environment has lately become the most important and sought for the place of birth where most of the techniques and tools are coming from, and that does open a range of opportunities for technologists.
Using marketing as the best example Andrew points out: “I do think what’s changed a lot are the techniques and the tactics that one uses. Let’s say in marketing. It is a radically different world today than it was five, ten, fifteen years ago in terms of how one uses digital technologies, the fragmentation of media globalization, and so on. There is a whole new range of connecting with buyers and establishing customer experiences and deep customer relationships and loyalty. The tools have changed. The principles still remain the same. Customer experience has always been important. Customer loyalty has always been important.”
Opportunities created by digital tools are increasing at an exponential rate and they have the tremendous capacity to offer incredible information about and for the benefit of a business at a very small price compared with the previous generations of entrepreneurs. However, for ensuring the success of a digital business, it’s also important to keep and respect the unchangeable economical principles and adapt our tactics and tools for connecting with clients, based on the way people currently interact with particularly digital media.
Lessons of success
During our interview, Andrew Salzman discussed two of the greatest projects he worked on, projects that he considers important and relevant for digital marketers who like to learn from peer practitioners.
The first case was Nest and the strategy he took that significantly propelled the company in being able to penetrate to mainstream buyers. Like any other producer of quality products, Nest management was sure that quality is enough to make customers want to buy the products through every channel. Andrew identified that the customers, although they loved the products, were reticent on buying because of the nuisance of installing them and testing them and so on. For many of them it felt like an unnecessary effort, an effort bigger than the need for a security camera, for example. “People liked the comfort of having a white van with security personnel installing and hooking things up and then setting up a monitoring system that would connect a camera to the police station or to the fire station, in order to know that they had safely solved for an issue not only detected a potential problem but solved a problem.”
Having this insight, Andrew, together with the Nest team focused on “the need to build what might be called a whole product solution. And in this case, it wasn’t simply providing home devices.”
What Andrew Salzman came up with, was getting a broader view of the elements required to provide mainstream buyers with the security, the comfort and the elimination of risk associated with trusting home security devices, to a company that provided just one element in a total solution. The next step only came natural and the company grew substantially.
The second case is with Blue scape, the offspring of a parent company that made physical workspaces like offices and cubicles. Then, they realized the world was moving fast to virtual workspaces where professionals in different locations are being able to work together and to collaborate with the help of technology with the same proficiency and easiness as if they were in the same room.
The company identified twenty-five industries where their technical solution would be a good fit. In this context, Andrew advised the company to the entertainment industry would be one of the first to go after as “Hollywood production environment would be perfect for their solution because it took full advantage of all the capabilities that they could offer and the nature of the work done in production studios aligned really well with their virtual office space.” The idea was, of course, a complete success that helped the company gain a lot of capital, both financially as in terms of image and client trust. At this point, Andrew advised a second direction, which is “to be going after oil and gas which they’re looking at now because if you have these virtual collaboration people in the field looking where to drill for oil and people crunching a lot of data in different environments, being able to aggregate these people and understand with greater precision where to drill can have millions if not billions of dollars in potential value in getting it right or getting it wrong.”
For the 2020 generation of entrepreneurs there is a whole range of new opportunities and applications out there, so in spite of the fierce competition, putting an extra effort should find an easy motivation. The history offers an unprecedented context: there’s easier access to capital than ever before, there is a whole range of already existing technologies like cloud computing, storage capacity, computing power and bandwidth and there is a whole range of tools that anyone can build upon opening streams of growth. As Andrew Salzman sees it, “It’s a wonderful time to be an entrepreneur simply because access to capital and access to our core infrastructure or technologies in order to build things has never been cheaper easier than it is right now.”
We hope you enjoyed our podcast interview with Andrew Salzman!
For more valuable insights, make sure you come back to check out our next Growth Interviews as well.
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