Wk 2 Discussion – Metrics and Information Visualization The most frequently used measures of central tendency for quantitative data are the mean and the median. The following table shows civil….
This case is a little different than the rest but it does a great job of focusing on “Product.”
Start by doing a separate Mind Map for each product. Each mind maps will have less information than a standard case because you are only given limited information. Submit all 4 mind maps as part of the case prep.
Instead of the Management Decisions and Decision solutions of a traditional case prep, analyze the case as follows.
Predicting diffusion is one of the most challenging things for new products. Read about the 4 products, and then using the information in the case, rank them on how rapidly and broadly they will diffuse. 1 = most rapid diffusion; 4 = slowest diffusion. Include the high level characteristics (data) from the case that you are basing your prediction on (details on how to rank are below.)
Your ranking and the explanation will take the place of the traditional Decision Statement and Solution Statement. Make sure the rank order is clear.
Most of you should have been introduced to the following concepts in other classes but here is a brief review. Note that everything below ties to the Marketing Framework, it’s just that the starting point is different for New Products.
To do the ranking you should put on the VCs hat that is considering funding the entrepreneur. In this world, what would the VC want to know? There is a standard set of questions that VCs typically ask. At this stage they assume the product performs as advertised (they are focused on the business questions first.) Before they actually cut a check they will have a domain expert validate the product design and performance characteristics in a “due diligence” phase.
So, what are the business questions VCs (and you) want to know? (Note: The VC will want evidence to support the answers. They don’t just take the entrepreneur’s word.)
- Is there an interested target customer?
- Is the level of interest great enough that the target customer will pay a price that is greater than the cost to deliver? (Profitability)
- Are there enough target customers to establish a financially viable market position? (Scale of opportunity)
- Are there competitors or alternatives that exist (or could be developed quickly) that provide the same or superior benefits? (What is the unique value of this new offering and how sustainable is it?)
- Is there a way to let the customer know about the product’s existence and benefits? (Are there media channels common to the target customer and how densely do they cluster in the media channels?)
- Is there a channel to get the product to the customer? (Is distribution possible and cost effective?)
- Can you scale the business to meet demand? (What are the cost and time requirements for producing the solution in a rapidly growing market?)
- There can also be unique product and category questions (like regulatory, etc.)
The case doesn’t answer all of these questions for the 4 products. If any answer is a clear “no” to any question then the odds of commercial success are close to zero. Most of the time the answer is in the “Maybe” or “Sort of” territory, or “Don’t know.”
There is no rank order to the questions; however, in real-life there is an order you address them to minimize risk (fail early and cheap.) Each new product will have unique risks. For some it could be regulatory, others it could be technical, etc.
Start by analyzing the 4 products using Mind Maps to capture the raw info. Then create a spreadsheet with the questions above on separate rows and the 4 products in columns. Fill out the matrix and note the holes in the matrix.
Then ask yourself, are any of the products low or “no” on any of the key questions? (Can you identify the poorest diffusion performer?)
Next, take each product individually and ask yourself “What would I have to believe (relative to the questions above) for this product to be a market success?” Do the beliefs pass the straight-face test?
Then rank the products from 1 = most rapid diffusion; 4 = slowest diffusion. Make your ranking clear and obvious.
In the VC world, if you decide to move forward, the next step is to de-risk as rapidly as possible by proving out the highest risk beliefs that can be tested at the lowest cost (that is the way you fail fast and cheap.)
- 4 Mind Maps in PDF format
- Spreadsheet with questions, Products and data
- Clear priority ranking where 1 = most rapid diffusion; 4 = slowest diffusion
- Finally, imagine you are the VC with a couple of million you plan to invest, which, if any, of these products would you be willing to make an investment in