Thursday, November 20, 2014

Reading :: Crossing the Chasm

Crossing the Chasm: Marketing and Selling High-Tech Products to Mainstream Customers
By Geoffrey A. Moore

"Prior to entering the world of high tech," Moore writes in the Acknowledgements of this book, "I was an English professor" (p.xix). I emailed this quote to one of my PhD students, who is thinking about taking a nonacademic career path, noting that there is indeed hope of success and fulfillment outside the halls of academia.

Certainly Moore has achieved a lot: the book, originally published in 1991, was a Businessweek bestseller and has at least three editions. The one I read was the 2002 revised edition, and it's still full of examples from the late 1980s, but it's still useful for all that. Essentially, Moore argues that in the technology adoption lifecycle, there's a big gap between early adopters and mainstream adopters. The gap—the "chasm" of the title—is tricky to negotiate because it's very difficult to transition to mainstream customers while still holding onto the early adopters, who are key evangelists.

Moore's basic approach is to carefully segment the market so that your product is the only one serving that segment—to be the big (or only) fish in the small pond, to be a de facto monopoly (p.108). To do this, he provides a few different conceptual tools.

The first is the Whole Product Model (p.109), a set of concentric circles that represent perceptions of the product. These are labeled (from interior to exterior): generic product, expected product, augmented product, potential product (p.109). The circles represent a progression from the early adopters to the later ones.

The second is the Simplified Whole Product Model (p.113), in which the generic product is surrounded by segments labeled: standards and procedures, additional software, additional hardware, system integration, installation and debugging, cables, training and support.

As a side note, I was uncomfortable with Moore's metaphors in this chapter, entitled "Assemble the Invasion Force." He describes the task of entering a competitive market as "trying to invade Normandy from England, and the installed market leader is playing the role of the Nazi forces" (p.117). Entering a market without competition is "as if one had landed on a new continent and decided to set up shop selling wares to the natives" (p.117).

Let's get to the third model, the Competitive-Positioning Compass (p.135). It's basically a matrix in which the x-axis is generalist v. specialist and the y-axis is supporters v skeptics. The resulting quadrants are: technology enthusiasts (specialist/skeptics), visionaries (specialist/supporters), pragmatist (generalist/skeptics), and conservative (generalist/supporters). You traverse the matrix in that order, and when you cross from specialist to generalist, you are crossing the chasm, "a transition from product-based to market-based values" (p.135). Moore provides a table contrasting the two sets of values (p.137).

Perhaps because of his background as an English professor, Moore describes the positioning of the product in terms of claims and evidence (p.152). He argues that your claim must pass the elevator test—that is, if you can't articulate it in an elevator pitch, it's not ready (pp.152-153). So he provides a good template for formulating this kind of claim:
For (target customers—beachhead segment only) 
Who are dissatisfied with (the current market alternative
Our product is a (new product category) 
That provides (key problem-solving capability). 
Unlike (the product alternative
We have assembled (key whole-product features for your specific application) (p.154)
And the claim must be backed by evidence, so he provides a beautiful little matrix on how to assemble it (p.157). This evidence is laid over the Competitive-Positioning Compass, with quadrants now labeled by types of evidence: technology (specialist/skeptics), product (specialist/supporters), market (generalist/skeptics), and company (generalist/supporters).

And here's where I think the real value of the book comes in. At its heart, Crossing the Chasm is a rhetoric handbook for articulating a value proposition. At this point in the book, Moore is helping people to articulate their claim in a specific format and provide different types of evidence for it. If you're interested in entrepreneurial communication, writing, and argumentation, it's at this point that the book is clearly worth the price of admission.

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