Shipulski On Design

We all want to increase top-line revenue by selling more.  But we’ve been selling our existing products into the same old applications for a long time now, and we’ve reached a hard limit – when we add more effort, we get little in return.  Developing an entirely new product will take a long time, so we will try to sell our existing products into new applications.  We will have to change our product slightly to make it work in the new applications, but we can do that quickly.  We have a good plan.

We search the globe for these new applications and find a winner.  It’s a new application in which our product has a technological advantage over the existing products.  The new value is clear to the customer, and they want to get rid of their existing products and replace them with our flagship product. Our product requires minimal changes, which we’ve already implemented.  Our product is ready to sell!  Let’s go!  Let’s get after it.  Not so fast.

As it turns out, the customers don’t know how to use our product, they don’t know how to install it, and they don’t have a way to buy the consumables and maintenance parts.  Before we can sell, we must figure out a way to get the products installed, to train the operators, to find a way to sell the wear parts and consumables, and to service the product.  As it turns out, with this new application, there are a lot of missing elements to the go-to-market system.

When selling into new applications, it’s not all about the product.  It’s all about the partners. It’s about finding and developing partners familiar with the industry, the application, and the customers.  But it’s tricky.  You are unfamiliar with the application and don’t know how to find these partners.  Once you identify them, they are unfamiliar with your product, how it’s installed, how it’s operated, and how it’s serviced.

It takes time and effort to educate, train, and develop a new partner.  They may know the customer, but they don’t know the ins and outs of your product.  And they need to educate, train, and develop you.  You may know your product, but you don’t know the customers and the ins and outs of the application.

These new applications can create incremental revenue for you and your new partners, and that’s exciting.  But at the early stages of development, these new applications require more time and investment than we’re used to.  The profitability equation will take some time to realize its full potential.  And to realize that full potential, be sure to create a go-to-market model that is profitable for your partner.  An unprofitable partner can’t afford to be a good partner.  And you need good partners.

Image credit — TMAB2003

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