Last week I outlined a series of developments in the wireless space that I believe pointed to "the formation of a viable and sustainable mobile platform that is able to deliver content and services
that will elicit a positive consumer experience." I wanted to re-visit this, if only to elaborate on some of the finer points of developing successful go-to-market strategies.
First, much
has been written with respect to the struggle that cell phone start-ups are facing, despite the estimated $1 billion raised in venture capital. There is an important distinction that must be outlined:
carrier is different than services provider. If you recall the example of QuickPlay Media that I talked about a few weeks back, the draw to the product is that it taps into consumer-appropriate
behavior, not that it replaces hardware or changes user behavior. The service is not trying to sell unrelated content from the device itself, nor is it trying to change the "primary purpose" of the
device. What does this mean? It means be careful about who is approaching you and what their true reach into the consumer market really is.
Which brings me to my second point: at what
point did we forget how to estimate a market? If I hear one more person tell me there are 200 million plus cell phone users in the United States, I will scream. Your target market--regardless of
whether you are a services provider, marketer or brand advertiser--is only as big as the total number of actual cell phone users who have the right handset, usage plan, carrier, etc. It doesn't help
you if 90 percent of the installed based can only SMS if you have video services. It doesn't help you if you are trying to sell services that need to be delivered in "real time" if the user is
engaging with the device off-line or during down time. It doesn't help you if you are marketing non-essential services on an essential platform. Remember, no matter how cheap or tasty, it is
impossible to sell water to a drowning man.
Third, it doesn't matter how much money you spend on marketing on mobile--if the market isn't ready to adopt or if the service isn't well
targeted, you are wasting your dollars. And please, never fall into the trap of: If it happened in (insert foreign market here) it will happen in the U.S.; in some cases yes, in most cases no. A
commercially branded MVNO has no better chance at success than the incumbent wireless carrier if the service is 6 months ahead of its time. In Lydia's Rules of Consumer Product Deployment, there has
to exist one or more of the following indicators to signal that a consumer market is ready for moving from niche to mass: significant product changes that fundamentally ease the products' use with
limited behavioral change required by the consumer (think DVR inside the set-top box versus stand-alone), disintermediation of current first-generation product (think eBay and antiques market),
critical mass (at least 15-20 percent penetration of required platform if you are a services based company - think Blockbuster and the VCR), and finally, the switching cost is lower than the
acquisition cost (think moving from Yahoo! Web Mail to Outlook).
Now, I am not saying that you shouldn't experiment or that you shouldn't engage on some level with a maturing consumer
product market. What I am saying is just be smart about it--be strategic about your relationships, manage your expectations, don't be afraid to say yes if only for the insight you will gain and no if
you can't do anything with it.