When rumours of Spotify acquiring Gimlet started, Twitter was abuzz with the phrase: Spotify wants to be the Netflix of Audio. Which I inherently did not like, but with Spotify also acquiring Anchor, I am certain that Spotify wants to be the Youtube of Audio, not Netflix, infact there will never be a Netflix of Audio. Let us dig in on the Why.Continue reading “Spotify is not the Netflix of Audio, it's the YouTube of audio.”
A few weeks ago I read a blog post by Tom Tunguz, which basically split product features into 3: MMRs (minimum market requirements), Differentiators, Neutraliser, which is a brilliant segmentation of product feature. Do read the post.
Segmentation is a very powerful concept in every field. While the concept is popular in the marketing field, it is either knowingly or unknowing used in every vertical of an organization. The advantage of breaking down problems, products, metrics, leads, clients or anything else for that matter is the simplification of whatever task you are working on.
On the sales side, prospects are always segmented into high tickets/whales or low ticket/long tail. Sales & Business Development teams are at times segmented by the role, there are the hunters who job it is to get new clients on board and farmers, who specialize in growing current account. Breaking the Sales problem into distinct segments, the way to approach the problem becomes clear.
Marketing usually pushes the limits of segmentation. From drive-by users to abandoned carts, users can be segmented into micro-segments which have distinct messages and offers for each segment.
Breaking Problems down for founders.
From a founder perspective, taking all your goals for the year and breaking them down is the sanest mechanism when working to build a rocket-ship. You can break it down in whatever way that suits your organization, break it down into smaller problem statements which can be take up by different people or break it down into problems that can take one at a time. Build a rocket today to take a picture of the Mars today, and build a reusable rocket tomorrow. The more you slice and dice the problem, the more manageable, doable and simpler it will seem. Growing traffic for a website might seem like a hard challenge, but once you break your current traffic sources down, under each of them, you can get a sense of which source you can leverage and grow the fastest or in the easiest fashion.
Internal, External, Controllable and Uncontrollable factors.
An advantage of breaking any problem is the fact you can break it down into things you can control and those that you can’t. Ideally, you should attach the internal controllable problems first, then move the external controllable problems next, and then try to attack the rest so that they become more controllable or you internalize the problem in some fashion.
Taking a website traffic example, the type of content you write is always in your control, but how the content will do organically on Facebook is not under your control, it is an external, uncontrollable aspect of your traffic. Spending ad dollars on Facebook is controllable but is still an external factor.
This is a phrase I have used a lot in recent meetings in the office. The basic premise is that organizations can’t be good at two skills which oppose each other, which basically require a whole different mindset. Here are a few examples
- You can either be the largest video platform on the planet or be the largest paid video subscriber base, the two require different skills. YouTube is all about discovering the best user-generated content, Netflix is about consuming the best, now heavily curated, video library. Yes, YouTube has subscription base, but relatively the money will be chump change.
- You can either be the largest restaurant chain in the world or be an authentic fine dining restaurant. Again, they require very different skills, Subway is all about managing the supply chain to the brand and the consistency in flavor, your favorite eat out around the block may probably have different flavors of food based on who is cooking that day
- You can either be a mass media newspaper trying to get as many readers and advertisers or a small 1 person publication running paid subscription site.
It is not to say that organizations can’t change their skill set. Microsoft is working hard to move from an Operating System organization to a services organization. New York Times seems to have made a successful move from a traditional newspaper to one driven by subscriptions. But these changes are relatively slow and very deliberate and not to mention challenging. Many have failed to make the transition, Blockbuster for example.
The skillset is driven by the strategy which drives, and also gets driven by incentives, more on incentives and their effects in a future post.
Photo by Pablo García Saldaña on Unsplash
This is an excerpt of my Audio post. List to the entire story here
- The way I look at it, as the internet gets the cost of distribution to zero and compute solutions from Amazon and Google get cost of starting up to zero, there is a rise in products that do the same thing, i.e. abundance
- Due to abundance, competition is very high. In such a high competition environment, it is hard to grow. My biggest learning in such an environment was, marketing is way more important than sales.
- Reason 1: The internet has flipped the buyer model. People inherently search for solutions for a problem and self-select a product.
- Reason 2: Until a problem is not important enough to be solved, people don’t want a solution. So, sending your best sales guys to such a prospect won’t help
- Another point to note is that more solutions move towards a freemium/Free to try products, sales teams loose as they are inherently are in conflict with the model
- In such a scenario, the job of marketing then becomes 2-fold
Working in start-ups is one of the best ways to learn something new. Even more so when there is a lot of competition. Analytics is one such space. We tried getting Pure Metrics off the ground for a year, but found no traction. But learnt a lot. Here are the bullet points to my audio post
- Make people aware the problem exists, which is where content plays a massive part
- Make people aware there is a solution, which is their product
- All this makes your branding efforts all the more important, in the world abundance, users are loyal to the brands