Friday, October 10, 2008

Simplified Traditional Technical Marketing

Apple's iPod used dancing silhouettes which is a big campaign. This is a product that needs marketing as much as anything...

Learning a bit of traditional marketing is useful for technologists. From the side it's not always clear what marketing is all about. The traditional definition is: "definition and management of the Price, Place, and Promotion of a product". In the technical world this also means defining the product (essentially telling engineering what the "package" will contain). It also means defining the three P's by understanding the market and the competition. This is true with more traditional consumer products but in the technology world it turns out a little different and crucial to understand.

This sounds simple enough but as a famous advertising executive once said: "learning marketing takes a year, practicing marketing takes a lifetime". This is because our work is highly competitive and the market conditions shift daily. The most important function of practicing technology marketing is bridging between the internal world of the technologist and the external world of the consumer (or market). This is more of a role and an attitude than just skills and experience. Marketers need to play the "devil's advocate" in front of the technologist when making a case for a more user friendly design. In front of a customer the marketer plays the "technologist". This puts the technical marketer in the middle ground and he/she needs to know both worlds well enough to influence them both. A big part of the work is translating from the "use model" to the "technical model".

Technical marketing can be views as the "story" about the product. To tell a story about how a product works means building a model of some sort. It also means knowing who will hear the story (customers) and what other stories the audience hears (competition). I use the "story" analogy just to illustrate the more abstract ideas quickly. The story is actually called a few different names as the marketing "process" moves from before a product is designed all the way to end-of-life.

The first part of a product's marketing "story" is planning and definition. Here a marketer defines the product in enough detail for engineering to design and manufacture a product. Basic product definition starts out with the description from a user perspective than engineering adds their core technology functions. These are algorithms, data structures, physical components (such are hardware, circuits, etc.) At this point of a product definition there is still no customer or competing product information. Once the basic product definition is done and engineering buys into the product the marketing team starts a customer and competitive work. The definition bridges the core technical specification with the main uses of the product. One of the best ways to define a product is by using "mock ups" or "demos" in front of perspective customers. Software products start out as screen shots and demo screens. It is very hard to demonstrate a software product's functionality, but sometimes it may be useful to do some engineering and get a "dummy mock up" which actually shows some function. Hardware products like ICs (integrated circuits) are tested in front of customers mostly through preliminary specifications. A customer that sees a specification of the "next big thing" usually will give the marketer good information about how he/she would use the product in his own design. This also includes the drawbacks and missing functions which will make the product usable as it comes out the first time.

Blackberry personal communicator is marketed mostly through "channels", these are the carriers which provide the phone service.


Once the product is well designed and tested in front of customers the engineers can get to work. At this point the marketer needs to start preparing the "channels" and the "market" for the product's introduction. Channels are a sales term for the distributors, representatives, and direct sales force. I will talk more about the sales process in another article, but need to talk about marketing's role here. This is a combination of the "promotion" and "price" aspect of the work. Most technology products are not promoted with advertising and public display the way consumer products are marketed. They use channels of distribution to promote products. New products usually need extensive support and training to get users started. This is the role of the channel. Sometimes technology marketers will have technical people who are called "application engineers". These technical marketers develop demos and training material to help early adopters start out with the new product.

The final part of this article is an introduction to a product launch. This is about one third (1/3) of the way in the marketing process (of a technology product). In the "marketing mix: price, place, and promotion" an introduction of the product to the market all the pieces have to be ready. The price is usually set by a competing product's price, the ability of the market to sustain a price over time, and the need to recoup the engineering cost of development.
The place is the "channels" and means of getting the product out to the end customer. In traditional consumer marketing a place sometimes is the most crucial part of the marketing mix. In technology companies that usually means who the first and than the end target is. For example, Intuit the producer of Quicken (a personal accounting package) marketed their product heavily to stock brokers in the early stage of their promotion. The idea was to hook them and use them as a "reference" to get to the end consumer. Stock brokers were a relatively small market, but highly influential with their customers. Once the stock brokers started keeping their client's accounting on Quicken they could influence their customers to use the application as well.
Finally the promotion is how a new product will be introduced to the consumer. When you buy a new computer from HP or Dell you will get a bunch of "free trial" programs like virus protection, Quicken (personal accounting), and maybe a trial to Microsoft Office or a graphic processing program for your photos (Photoshop by Adobe). This is one form of promotion which is relatively low cost. The only cost to the marketer is the management of a relationship with Dell and HP. Microsoft does this with their higher end Office suites. When you buy a low end package they let you try more applications (like Access database and Visio charting).

This article used the traditional "marketing mix" model. For the most part, technology companies use this model initially to get started. Once I explore the other functions of the marketing "process" (I will also refer to this at the "marketing flow" ), we will go into more into specific areas of technical marketing which are unique to the field. But it's always good to know the very basic traditional techniques.

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