Archive for November, 2010
I spent the morning today visiting with the team at Quantcast, which is up to some pretty exciting stuff, and ended up discussing with co-founder Paul Sutter what Paul calls the “5-50-500″ rule. I found it pretty instructive not just as a lens for evaluating Quantcast’s progress, but more generally as a useful way to think about the phases of a startup.
The idea is that startups go through distinct phases that are marked by the number of customers it serves. [Note, this is oriented towards B2B businesses]. The “5″ phase is marked by very high touch relations with the first 5 customers, typically beta customers who are helping inform you of product requirements and product-market fit generally. The “50″ phase is where you more or less have product market fit and you shift focus toward go to market strategy and tactics. And the “500″ phase is where you focus on building a scalable model for selling and delivering your product/service.
While, of course, there are other metrics by which to chunk out the phases of a business (no. of employees, revenue and profit levels, amount of risk reduced/remaining, to name a few), it is a very worthwhile exercise to ask yourself what will be required to sell and service 5, 5o and 500 customers. You may be surprised by the answers…
I have totally drunk the Kool-Aid on Social CRM — it’s my latest favorite answer to the question “what’s the next big thing?”
The social sea-change spreading across the web is not just influencing consumer sites and services, but will have a major impact on categories from Ad Tech to enterprise software. And nowhere is this more evident than in CRM. Which makes also the sense in the world, since the “C” whose relationship is being managed is an inherently social creature who is becoming increasingly comfortable with (even dependent on) social products and services.
Paul Greenberg explains that Social CRM makes sense in large part because
customers … want to engage more than ever with the companies that they are purchasing from and they are conversing about those companies in the channels that the companies don’t control.
According to Greenberg, companies are looking to SCRM for 5 different uses:
How to find out what their customers are saying about their brand – good and bad. How to provide customers with inputs to the company so that the customers can either have the opportunity to participate in dialogue with the company, or provide feedback to the company in multiple ways or minimally, have avenues for greater transparency from the company. How to provide self-service avenues that are sufficient to allow the singular customer to sculpt his or her own individual experience with the company whether as simple as deciding on the channel that the individual customer wants to use to find out information or as complex as creating and using tools to produce a product that is tailored to the customer’s individual desires. How to make sure all of the customer’s interactions and social data become part of the individual’s customer record – adding to the more traditional transaction records and basic field level data (name, address, etc) that already resides there. How to use all that to gain insight into the social customer and to figure out the value of that social customer to the company?
The Lean Startup movement has brought the concept of a “minimum viable product” into the mainstream of startup culture and strategy. Last weekend an entrepreneur I met introduced me to the concept of “minimum viable network.” In a nutshell, the idea is more or less just that you need a critical mass before a social network becomes useful. And where, as with sites like Yelp, the network requires some degree of physical proximity, this critical mass must be obtained in each region the network operates.
