Posts Tagged ‘ISV’

Thoughts on Geoffrey Moore’s Crossing the Chasm

April 17, 2009 Leave a comment

Josh Frankel: Review of Crossing the Chasm

April 17th 2009 | Josh Frankel

Thoughts on Geoffrey Moore’s Crossing the Chasm

In the world of software the success of one product and the failure of another can sometimes seem arbitrary and random. Crossing the Chasm is an attempt to explain how a sound marketing strategy can make the difference between success and failure.

Transitioning from a few visionary users to numerous, pragmatic mainstream users—crossing the chasm—is the central concern of a carefully-planned long term marketing strategy. Using anecdotal examples in the loosely-defined “high tech” market, Geoffrey Moore presents a compelling model for how everything from electric cars to killer apps is embraced by mainstream and niche consumers.

Moore explains how software goes from being used by a handful of users to the mainstream market. He identifies five specific segments in this “adoption life cycle” and places them on a bell curve model:

•    Innovators and early adopters are the first to pick up new technology, and represent a small yet vocal portion of the market.
•    Early and later majority-users represent the main portion of the marketplace and are driven by the perceived practicality of a product.
•    Lastly, there are the laggards who resist new technology until it becomes overwhelmingly pervasive.

As an example of innovators and laggards, consider when the movie Wall Street came out (1987), and Gordon Gecko wowed audiences by talking on a cellphone. Fast forward to the present with my cellphone-less grandparents, and you have a pretty good idea of the spectrum.

Establish a Beachhead, then Divide and Conquer

To bridge the chasm between early and mainstream markets, Moore proposes a strategy he likens to establishing a beachhead: claim a place from which to expand your market share by first positioning your product in a niche market.

Continuing with the military metaphor, he endorses a divide and conquer mentality as the primary way to segment and dominate the market. Support, documentation, and other user resources are recommended to reassure customers of a strong and permanent presence. Moore uses real-life examples to demonstrate that the viability of a niche is directly related to the pain caused by its core problem. One can imagine how the attempts to resolve a point-of-pain can result in the creation of a new product.

Once the problem has been identified one can consider different scenarios, akin to the concept of goal-oriented design within agile processes. A difference here is the underlying basis of Moore’s model which focuses on building whole products—products that pose a complete solution to the problem identified in the niche market. Without all the pieces in place, the customer has not been presented with a compelling reason to buy and may consider other products instead. The trick at this stage is to make the product the only “reasonable” one to purchase. A fundamental consideration for software development is the need for marketing to consider the scenarios that necessitate software, while building software necessitates considering the personas of those involved in those scenarios. Unless marketing and development are integrated in this respect the concept of a whole product is likely to drift into the realm of a Dilbert parody.

Lastly, Moore identifies product-centric concerns prior to gaining hold of the mainstream market. Speed, ease-of-use, elegant construction, price, and functionality shift to market-centric concerns when competing in the mainstream. At this point values such as largest base, third party support, de facto standard, and quality of support become primary reasons to buy. During this shift into market considerations Moore recommends clear understanding of the competition in the form of software alternative and product alternative.

Some Takeaways and Thoughts on Our Business

In reference to software created in Thycotic’s environment, product alternatives are the obvious competitors—our Secret Server password software finds some product alternatives in Cyberark and PMP. In terms of market alternatives to Secret Server, the closest parallel in terms of major engrained tools are antiquated methods of passing sensitive data through non-secure means, like spreadsheets. This is not a true market alternative but it is as close as we can apply Moore’s product/market alternative concepts.

At very least, the value of Crossing the Chasm comes from instituting a formalized structure and vocabulary for a constellation of common sense. The use of anecdotal companies helps bring these pieces together, with the caveat being that many of these companies are not recognizable names or have since ceased to exist. Moore’s implementation method for crossing the chasm seems to reflect its age, with only two paragraphs devoted to the use of the Internet as a medium for sales and marketing. Contemporary marketing and sales demands participation with Google. This does not change the overall structure for crossing the chasm but it does change the speed at which competition and niche markets arise.

Josh Frankel is the junior graphic designer and marketing team member at Thycotic Software Ltd, an agile software consulting and product development company based in Washington DC.  Secret Server is our flagship enterprise password management product.
On Twitter? Follow Josh