How do we achieve world class marketing in New Zealand? As I have regularly traversed in this column, my belief is that it is not about developing fancy logos or clever advertising campaigns, but about creating genuine customer value. I decided to get the perspective of Christchurch-based Chief Technology Officer of Navman, Dr Richard Mander, who has a wealth of experience working in US technology companies.
Canterbury is incredibly lucky to have someone of Mander's pedigree working in the local technology sector. An alumni of Mt Pleasant Primary School, St Andrew's College, Christchurch Teacher's College and then University of Canterbury, he left Christchurch to complete an MA at the University of Auckland and then a PhD at the renowned US Stanford University.
After a stellar stint at Apple Computer, he started his own technology business, AdessoSoft. A business called Zanzara, in partnership with his usability expert wife Amanda followed, counting a veritable who's who of US technology businesses as clients - IBM, Apple, Sun, Hewlett Packard, Microsoft, Adobe, Symantec, Siebel, Palm, Motorola, Xerox, Sony and Netscape. In 2004, he was given the New Zealand Trade and Enterprise's "world class New Zealander" award, and returned to a job with New Zealand technology powerhouse Navman after 17 years away. Amanda's business Zanzara now operates out of Christchurch.
"In New Zealand there is considerable confusion between sales and marketing. We need to pay more attention to product marketing," says Mander, "Marketing needs to be part of the product research and development process from the beginning. When engineering makes something and then hands it to marketing to sell it doesn't work."
"People tend to resist design or marketing ideas because they see them as asking the customer what they want, which they feel isn't usually a good guide to what products they should develop. They are right - it is not about understanding what the customer wants, but what their unmet needs are. The value you add is working out how your products might solve those unmet needs."
Mander offers the example of someone producing software for industrial bakeries. "If you are selling software to industrial bakeries, the unmet need is around improving the efficiency of their operation. That's what you need to become an expert in - the efficiency of bakeries, and then have a solution that happens to be software." You can then use this knowledge to guide your product development, and all of the other services you might offer around the product.
"This is the real skill for anybody making a product. Understanding the customer's unmet needs can make your business great by giving you a competitive advantage - it is the difference between a 'me too product' and a premium product."
Once you have gained an understanding of the customer's unmet needs you need "to stick to your knitting", says Mander. Don't develop any more features unless you have to - work out what is absolutely required and do that, put things that are 'admired' or 'desired' on the back burner. It is critical to get your product to market and then continue learning.
Mander offers evidence from the American Product Development Management Association showing that 60% of new products fail. Their research reveals three trends that successful companies have. One, they understand the customer need - their product is designed to meet a clearly identified customer need and in the eyes of the customer provides unique benefits and value for money. Two, they have a market orientation - product decisions are supported by well executed market research. Three, they have technical leverage - there is a good fit between the product and the company's technical competence and development expertise.
Mander does have some words of warning for those wanting to take the customer-centric approach. "It is important to balance meeting the customer's unmet needs with what you can realistically deliver at a profitable price."
"Thinking like customers also means understanding there can be significant differences between seemingly similar markets." The United States and New Zealand might seem broadly similar, but can have significant differences. Mander cites the example of the Navman GPS tool for cars, where the company sought to understand the different needs of the LA commuter versus the Auckland driver. Both have congestion to contend with, but LA driver has multiple routes while Aucklanders are far more restricted, meaning significant differences for the way they use the Navman product. It is hard to gain those insights unless you talk to real users, he says.
Mander also had some tips on how to attack the US market. "You need to focus as much as possible - select and understand a market niche. Do everything to secure an exemplar customer in that market and then leverage them. You also need to reduce the barriers to people buying from you - have a US 0800 number, work US hours, use US English, and .com rather than .co.nz."
Mander is living proof that New Zealanders have the capability to do well in big, competitive markets like the United States technology sector. His experience also shows how important it is that our inherent talent for innovation is matched by a focus on marketing