One of the greatest limitations I’ve seen in IT is when companies feel they have one product. Take a look at the eHarmony. They have built an extensive online application to help match people with their potential soul mate. They offer a suite of tools ways to enhance communication, and a product marketing strategy that has led them to be the most well-known platform.
Compare that to ChristianMingle.com, which you may have seen advertised as well. It appears to be a highly focused or specialized version of the eHarmony dedicated at one particular section of the population. At first glance you would see this as a single product offering in a very niche space. But take a closer look. Christian Mingle is actually one of over 25 branded sites (Black Singles, Hurry Date, Military Singles, etc.) the same software platform. The company has taken one platform which doesn’t have to be best in market, and rebranded it for very specific niche market segments. This allows them to get deep market penetration within a small slice of the customer base, but repeat that product delivery across market segments. And the best part is that there is little additional IT cost.
So how can this approach work for your business? First, it takes your IT leadership working closely with your marketing and sales departments. Your IT group must understand who you’re trying to sell to. If you see an opportunity where there are different segments or an opportunity to drill deep in a particular segment, you may have the right mix. Now how do we take a step forward? Most IT groups would take their platform replicate it for a specific market and rebranded for that market. That’s okay, but in essence you are now creating multiple parallel products that will now all have to be upgraded in parallel, or they will soon become disparate. Instead, why not spend the extra time creating a configurable solution. Take those few things that are different between products, and change them into configurable system parameters.
Does this work? Absolutely! When I worked with MarketVelocity, a company that specializes in launching and managing product return promotions for companies like HP and Xerox. The company provides a platform for customers to find the value of their used electronic products, and exchange them for credit and rebates towards new products. The cost of developing a separate software solution for each vendor created a barrier to entry. Instead, we were able to change the entire platform over to a configurable solution which reduced development time for new client sites by 80%, new client promotions by 90%, and decreased client startup costs by 40%, while increasing profit margin by 135%.
We had a similar situation at Voicecom Telecommunications. The company developed a unified messaging platform which was best in market at the time. Selling to direct to individual subscribers had high barrier to entry. With little additional cost, we were able to develop private label versions of our messaging system, and then leverage the brand equity of our partners to assist with sales. The company’s messaging solutions could be offered through companies such as HQ offices as a reseller agreement to clients where they already had an existing relationship. To support a partnership program, Voicecom even developed an object-oriented marketing strategy, allowing our partners to pull from different value propositions and best match to the needs of their customer base.
The key to success is understanding both your market space and your IT capabilities. You must align leadership between multiple departments in your company for this to be successful. Your sales and marketing needs to drive product innovation, in the same way that IT capabilities open up new market and sales opportunities. So take a closer look at your products and see if there is a niche market that you could exploit if you only had a private label or reseller solution that could penetrate the space.
