Think Toyota Corolla not Rolls Royce when it comes to developing technology products, says Kiwi commercialisation expert John O’Hara.
John is director of a number of technology companies and advises many companies on the commercialisation of innovation. He has even penned a book on the subject.
Flying buff John O’Hara probably has more experience than anyone else in piloting New Zealand technology businesses in world markets. Starting and growing four technology businesses to successful exits is only part of his resume. He has also completed more than a dozen offshore licensing agreements with major American and English companies, as well as establishing successful joint venture companies in Canada and the United Kingdom.
So in his experience how significant is marketing for the average technology business? “Marketing is the biggest issue for technology companies – particularly in ensuring that a market for their product actually exists, and if so how to best fit their product to that market.”
“Marketing helps keep the wheels on, it keeps development focussed.”
Understanding your market is an absolute fundamental, says John. “Technology companies can look at the technical side too much - what they think their product is technically a solution to is not actually what the market wants.”
“For example, I worked with a company that developed a product for managing software licensing, but that wasn’t what the market was interested in. They saw it as a security product, that’s what drove their interest in purchasing it – you have to be able to adjust to that.”
It is also easy to be misled by early adopters in a market. “Just because some early adopters like it doesn’t mean it will fly – you need to have a realistic assessment of the market opportunity.”
John says many technology companies fail to understand this because they are too product focussed. “They have to realise that the investment in the product is 10% of the task, not 90% - that is a real disconnect for many companies.”
“Too many technologists are focussed on building the Rolls Royce rather than a Toyota Corolla – when a Corolla is what most people in the market actually want. Are they building their ego or building a business?”
A crucial part of the other 90% is how to actually deliver a technology product into a market, which is where John challenges the assumption that taking your products directly or through distributors is the best path. “The chance of displacing a larger, established competitor simply with a better product is very slim. You are better to find a significant player to work with in the market.”