The Power of Three: When Technology, Business, and Marketing Converge - Part II
By Douglas Rushkoff, Tue Feb 24 07:45:00 GMT 2004
It's one thing to know your consumers - it's a far greater challenge to develop your technology and balance sheet around them.
In part one, we looked at the importance of congruence in strategizing your marketing along with your infrastructure along with your financials. Then we considered how new forms of content experiences are bifurcating the mobile market into two main camps: the tinkerer and the do-it-for-me. Now it's time to put these ideas together, and determine the best ways of providing for - and making a business from - these two usage profiles.
In both cases, we determine our intended user base, and then leverage the Power of Three: devise a business plan with sensible content deals, build the right software and infrastructure, then communicate your offerings effectively.
The Tinkerer Strategy
Those of you who go after the tinkerer will need to develop networks with open standards, and software with documented code. You'll need to publish developers' kits online, establish clubs for programmers, awards for great implementations, and magazines and books that share tips and tricks.
You will be required to develop business models that depend on fees per minutes used, rather than fees for content, since your users will be finding content of their choosing for free or from other vendors. And while the content revenue stream may be limited, your company won't have to spend money developing content or even, in some cases, content platforms. Your users will become your free workforce of engineers. Your money will be better spent supporting consortiums and universities than on payrolls.
Finally, companies marketing to the tinkerer will have to develop promotional campaigns that convey the do-it-yourself lifestyle, non-conformity, and community values. These efforts would be more based in public relations or public service - actually doing things - than in advertising, or simply saying things.
The Do-It-For-Me Strategy
If your company decides to focus on do-it-for-me's, you will need to develop packages - suites of services that appeal to particular market segments: the business package, the student suite, the kids' control board, the family phone. While a company with a pre-existing lifestyle identity - like Virgin or Nike - may choose to hone in on one user demographic, the inevitable consolidation of the industry, as well as the necessary exclusivity and high cost of partner deals, will favor those who choose to provide total solutions for a broad but intelligently segmented range of consumer profiles.
The business models for do-it-for-me wireless providers will generate revenue from services and content more than minutes. Yet while you will be free to give away more minutes to users who subscribe to pre-configured content delivery services, you will also have to share more of this revenue with your content partners. One key to capitalizing on this equation will be to secure exclusive contracts with key content providers who have existing relationships with consumers, such as brokerage houses, sports networks, and game companies. Then, you become the only possible choice for do-it-for-me's already committed to one or more of them.
Marketing to the do-it-for-me means touting both an end-to-end solution from a wireless company that will take care of everything for you in advance, and convincing the consumer that you really know who he is and what he wants. In the end, your carefully selected array of content providers is your best way of convincing each demographic that you have identified not only their needs, but also their styles of assessing their needs.
All or Nothing
If I were choosing a cell phone or service package for myself, I'd probably fall into the tinkerer camp. I'd rather run a company that catered to this market, too. But if I were picking a direction for my wireless company and I had to guarantee revenue in the short term, I'd probably choose to focus on the do-it-for-me category. Cell phones are not computers, and most of the computer hackers I know still limit their hacking to the computer; they use their cell phones out of the box in whatever manner they were configured, and speed-dial their friends to talk about whatever cool thing they just did on their Linux box.
As the wireless space becomes a genuine multimedia content delivery platform, however, this could change. There is a generation growing up with wireless devices whose comfort programming by thumb has yet to be measured.
Is there a way to appeal to both the tinkerer and the do-it-for-me? Probably - but not at the same time. It would mean creating two separate brands - truly separate brands with their own names, identities, technological infrastructures and business plans. Anything short of that would lose to competitors whose platforms, deal structures, and marketing strategies are better leveraged for one group or the other.
In short, any company that is serious about moving into the full-fledged wireless content delivery universe of tomorrow will have to decide which side of the age-old technology divide it wants to be on. Otherwise, it risks developing the wrong technologies, creating improperly rationalized balance sheets, and looking like a company that doesn't understand the first thing about the digital lifestyles that both tinkerer and do-it-for-me imagine for themselves.
Choose or lose.