Transcript Day 4_Session 1 - Customer developmentx

Customer Relationships Development and
Management
Based on Steve Blank Lean
Business Canvas
Methodology
Financed by
Supported by
Implemented in cooperation with
Financed by
Supported by
Implemented in cooperation with
Well developed relationships give business marketers a
significant competitive advantage. Topics include:
1. Patterns of buyer-seller relationships
2. Factors that influence customer profitability
3. Strategies for designing effective customer
relationships
4. Critical determinants of relationship marketing
effectiveness.
Financed by
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Implemented in cooperation with
2
Taken the Lean Business Canvas
methodology
We will analyze the following customer relationships from
the initial stage of development to its further
management
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Implemented in cooperation with
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4
value
proposition
key activities
customer
relationships
key
partners
customer
segments
cost
structure
revenue
streams
Financed by
key
resources
channels
Supported by
Implemented in cooperation with
5
images by JAM
CUSTOMER RELATIONSHIPS
what relationships are you establishing with each segment?
personal? automated? acquisitive? Retentive??
Financed by
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Implemented in cooperation with
We Call Customer Relationships
Demand Creation
• Get, Keep and Grow
• How will customers hear about your product?
• How much will it cost to acquire a customer using these
strategies?
• How does market type impact my demand creation strategy?
Financed by
Supported by
Implemented in cooperation with
Customer Relationship Definition
Get
Keep
Grow
Financed by
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Implemented in cooperation with
Financed by
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Implemented in cooperation with
9
Get Customers
Financed by
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10
Who needs to hear about you?
Financed by
End User
Suppliers
Influencer /
Recommender
Channels
Economic
Buyer
Government
Decision Maker
Partners
Supported by
Implemented in cooperation with
Demand Creation Getting Free Users
Demand
Creation
• Search Engine Optimization (SEO)
• Blogging / Sharable content
• Social Media / Gaming Mechanics
• Communities
• Proven viral coefficient >1
Financed by
Supported by
Implemented in cooperation with
Demand Creation Paying For Users
Demand
Creation
 Public Relations
 Demand Capture
 SEM
 “Free” products (e.g. widgets)
 Biz Dev
 Affiliate Marketing
 Market Education
 Webinars
 Email marketing
 Trade Shows
 Analyst Reports
 Direct Sales
 TV / Radio
Financed by
Supported by
Implemented in cooperation with
Get Customers Funnel - Physical
“Get Customers” Funnel
Financed by
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Implemented in cooperation with
Demand Creation Feeds the Sales Funnel
Demand
Creation
Acquisition
Paying
Customers
$
Financed by
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Implemented in cooperation with
Keep Customers
Financed by
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Implemented in cooperation with
16
Keep Customers Funnel - Physical
Earned and
Paid Media
Get Customers
Loyalty Programs
product updates
Keep Customers
Customer check-in calls
Customer satisfaction survey
Financed by
Supported by
Implemented in cooperation with
Grow Customers
Financed by
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Implemented in cooperation with
18
Grow Customers Funnel - Physical
Earned and
Paid Media
Grow Customers
Get Customers
product updates
Loyalty Programs
Keep Customers
Customer check-in calls
customer satisfaction survey
Financed by
Supported by
Implemented in cooperation with
Get Customers
Financed by
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Implemented in cooperation with
20
Get Customers Funnel – Web/Mobile
“Get Customers” Funnel
Viral Loop
Financed by
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Implemented in cooperation with
Demand Creation Feeds the Sales Funnel
Earned and
Paid Media
PR
“Get Customers” Funnel
Viral Mktg
SEO
SEM/PPC
Blogs/Website
Affiliate Mktg
Advertising
Tradeshows
Financed by
Supported by
Viral Loop
Implemented in cooperation with
Keep Customers
Financed by
Supported by
Implemented in cooperation with
23
Keep Customers Funnel - Web/Mobile
Earned and
Paid Media
“Get Customers”
Product updates
Affiliate Programs
Keep Customers
Viral
Loop
Financed by
Supported by
Blogs,
RSS,
emails
Contests,
events
Loyalty
Programs
Implemented in cooperation with
Grow Customers
Financed by
Supported by
Implemented in cooperation with
25
Grow Customers Funnel - Web/Mobile
Earned and
Paid Media
Grow Customers
product updates
Affiliate Programs
Keep Customers
Contests,
events
Blogs,
Loyalty
RSS,
Programs
emails
Viral
Loop
Financed by
Supported by
Implemented in cooperation with
• How many come through
the first step?
• How much does that
cost?
• What is the conversion
between each level?
• How much in revenues
can you get out of each
acquired customer?
Financed by
Supported by
Implemented in cooperation with
Demand Creation by Market Type
Create, drive demand into your sales
channel
Existing
Resegmented
• Educate the market
• Identify/drive early adopters into your sales
channels
New
• Copy a business
Clone
Financed by
• Educate the market about what’s changed
• Drive demand into channel
Supported by
Implemented in cooperation with
Market Type
Existing
Resegmented
New
Customers
Known
Possibly Known
Unknown
Customer Needs
Performance
Better fit
Transformational
improvement
Competitors
Many
Many if wrong, few
if right
None
Risk
Lack of branding,
sales and
distribution
ecosystem
Market and product
re-definition
Evangelism and
education cycle
Examples
Google
Southwest
Group on
Market Type determines:
 Rate of customer adoption
 Sales and Marketing strategies
 Cash requirements
Financed by
Supported by
Implemented in cooperation with
Team Deliverable by Next Week - Web

•
•
•
•
Financed by
Get a working web site and analytics up and running

Track where your visitors are coming from (marketing campaign, search
engine, etc.) and how their behavior differs
 What were your hypotheses about your web site results?
Actually engage in “search engine marketing” (SEM)
Spend $20 as a team to test customer acquisition cost.
•
Ask your users to take action, such as signing up for a newsletter.
•
Use Google Analytics to measure the success of your campaigning.
•
Change messaging on site during the block to get costs lower, team that
gets the lowest delta costs wins.
If you assume virility
•
show viral propagation of your product and the improvement of your viral
coefficient over several experiments
What is your assumed customer lifetime value?
•
Are there any proxy companies that would suggest that this is a
reasonable number?
Supported by
Implemented in cooperation with
Team Deliverable by Next Week
•
•
Financed by
For non-web teams:
•
Get prototype demo working.
•
Build demand creation budget and forecast.
•
What is your customer acquisition cost?
•
Did anything change about Value Proposition or Customers/Users?
•
What is your customer lifetime value? Channel incentives – does your
product or proposition extend or replace existing revenue for the channel?
•
What is the “cost” of your channel, and it’s efficiency vs. your selling price?
Everyone: Update you blog/wiki/journal
•
What kind of initial feedback did you receive from your users?
•
What are the entry barriers?
•
Present and explain your marketing campaign. What worked best and
why?
Supported by
Implemented in cooperation with
Examples
Financed by
Supported by
Implemented in cooperation with
32
implantable drug infusion pumps
with remote physician control
for chronic pain patients at home
“the right dose at the right time and place”
Christian Gutierrez (EL), Ellis Meng (PI), Carol Christopher (IM), Tuan Hoang (FE)
Financed by
Supported by
Implemented in cooperation with
Chronic Pain v4
Trade shows
FDA
Foundations
Advocacy Groups
CMS (Medicare)
OEMs
Electronic health
record providers
Marketing Costs
Financed by
Training
Patients
Formulary Acceptance
KOLs
Wireless
Developers
Faster relief
FS Team
IP
Proprietary
knowledge
Efficient patient
management and
Dosing flexibility
Clinical data
Clinicians
Support
Access to high-value
therapies and
pharmacoeconomics
Hospitals
pharmacoeconomics
Pain clinics
Institutions
Payors/ICA
Human
Resources
Product Dev Costs
Unit sales
Manufacturing Costs
Support Services
FDA/Clinical Trials
Supported by
Bundled kits
Electronic records
Implemented in cooperation with
Getting out
Clinicians
 Dr. Stan Louie, Drug Formulation Expert (USC
Institutions/patients
Pharmacy)
 Dr. Giovanni Cucchiaro, Anesthesiologist (CHLA)
 Dr. Diana Hull, Physician (Group Health in
Washington state, formerly at Kaiser California)
 Thomas Hsu, Insurance Specialist (Network Medical
Management; a California ICA)
 Two chronic pain patients
Pump user and creator of support forum
 User of oral narcotics and patches

Regulatory
 Dr. Frances Richmond (Director Regulatory Science
Program, USC)
Entrepreneurs/
Industry
Financed by
 Richard Hull (formerly at company selling
Lapband
Supported by
Implemented in cooperation with
Electronic
Health
Records
Partners/
OEMS
Fluid Synchrony
Electroni
c Records
Support Pump +
Services Controlle
r
Bundled
Kits
Product
flow/Channel
Hospitals
(Anesthesiologists
Neurosurgeons)
Patients
Pain Clinic
(Anesthesiologists
Neurosurgeons)
Financed by
Supported by
Implemented in cooperation with
Channels (Direct)
Hospitals
Pain Clinics
Financed by
• Direct to institutions
• Some formularies involved in purchase
decisions
• Some doctors make purchase decision
directly
• Device company/Doctor relationship is key
• Heavily influenced by :
• Clinical study results
• Regulatory approval
• Reimbursement
Supported by
Implemented in cooperation with
Patient Care Flow
(Now)
Patient
Discharged
Surgery/Rx/
reprogrammin
g
Trial period/
Home
setting
Scheduled
follow-up
Partners/
OEMS
Fluid Synchrony
Support Pump +
Services Controlle
r
Hospitals
(Anesthesiologists
Neurosurgeons)
Pain Clinic
(Anesthesiologists
Neurosurgeons)
Bundled
Kits
Key factors:
Reimbursement ,
state regulations
Weeks/months
Financed by
Supported by
Implemented in cooperation with
Electronic
Health
Records
Actionable feedback
to doctors/institutions
Electroni
c Records
Support Pump +
Services Controlle
r
E-prescription / closing loop
Patient
Discharged
Partners/
OEMS
Fluid Synchrony
Surgery/Rx/
reprogrammin
g
Trial period/
Home
setting
Scheduled
follow-up
Hospitals
(Anesthesiologists
Neurosurgeons)
Bundled
Kits
Patient
Care Flow
(Proposed)
Pain Clinic
(Anesthesiologists
Neurosurgeons)
Weeks/months
Financed by
Days
Key
factors: Reimbursement , state
regulations
Supported by
Implemented in cooperation with
Regulatory considerations
Trial size
PMA
510K
100’s of patients
20-100
Costs
Up to $100,000 per patient
$10-50 MM
Time
•
•
•
•
Financed by
$1-10 MM
~ 3-4 yrs + post
~ 2-3 yrs
approval follow-on
PMA approval with grouping of FDA approved drugs.
Clinical trials results used to obtain CMS (Medicare) approval
510K restricts technology to predicate devices
• Can be more difficult to market against incumbents
European CE mark is easier to attain (safety and performance
only)
Supported by
Implemented in cooperation with
Take-aways
•
•
•
•
Channel is direct in this existing market
Channel for e-health is more complex and evolving
State-to-state regulations can impact incentives
Can pose problems as electronic records systems vary
across the country
Next Steps
•
•
•
Financed by
Understand costs associated with reaching doctors/institutions
directly
Understand structure of e-health channel
Develop regulatory pathway (timelines and cost profile)
Supported by
Implemented in cooperation with
Chronic Pain v4
Trade shows
KOLs
Formulary Acceptance
Foundations
FDA
Faster relief
Efficient patient
management and
Dosing flexibility
Access to high-value
therapies and
pharmacoeconomics
IP
Proprietary
knowledge
Institutions
Hospitals
pharmacoeconomics
Human
Resources
Payors
Pain clinics
Product Dev Costs
Unit sales
Manufacturing Costs
Marketing Costs
Financed by
Clinicians
Clinical data
Support
OEMs
Electronic health
record providers
Patients
Training
Advocacy Groups
Wireless
Developers
FS Team
FDA/Clinical Trials
Supported by
Support Services
Bundled kits
Electronic records
Implemented in cooperation with
“insero” = to plant
”gen” = gene
Manufacturing platform for
rapid, cost-effective, and scalable
production of therapeutics in tobacco
Financed by
Supported by
Lucas Arzola (EL)
Karen McDonald (PI)
Vasilis Voudouris (Mentor)
Implemented in cooperation with
What We Know
 We have a novel technology platform with numerous market opportunities
 Our working hypothesis – that we can scale up and commercialize our
platform for production of life-saving therapeutics
 Jon Feiber – “Since you are a platform technology, it makes sense to engage
in ‘market discovery’ and ‘customer discovery’ at the same time during the
next weeks”
 Challenging this hypothesis by speaking with as many experts and
customers as we can
 This week: explored decision making and distribution channels in the case
of a pandemic
Financed by
Supported by
Implemented in cooperation with
Target Product – seasonal &
pandemic flu vaccines
The Business Model
Canvas
Tobacco Suppliers
Gene Synthesis
Companies
CMOs
- Purification
- Fill & Finish
- Packaging
- QA/QC
CROs
- Clinical Trials
FDA
R&D
Manufacturing
Regulatory
Approval
Licensing
Marketing
IP – Patents, Trade
Secret
Manufacturing
Facility
Capital Investments
Manufacturing Costs
Licensing Costs
Marketing
Financed by
Supported by
Speed
Cost-Effectiveness
Robustness
Scalability
Safety
Ease of
Customization
U.S. Supply
Long-Term
Contracts with
Government and
Vaccine
Manufacturers
Distribution through
Government and
Pharma Companies
U.S. Government
- CDC
- HHS BARDA
- DOD DARPA
Foreign
Governments
NGOs
Vaccine
Manufacturers
-Established and
Emerging Biotech
Contract Manufacturing
Fully Integrated Manufacturing (Sales)
Licensing (Royalties)
Implemented in cooperation with
Getting Out of the Lab!
Cast a broad net by talking to many different experts and customers:
(1) Executives from large companies
Name
Title
Institution
Michael Girard
Sustainability Manager
Aerojet
Michael Jacobson
Director of Corporate Responsibility
Intel
Joseph Kieren
Director of Corporate Real Estate
AT&T
(2) Entrepreneurs and angel investors from Sacramento
Name
Title
Institution
Andrew Hargadon
Professor of Management
UC Davis
Wil Agatstein
Professor of Management
UC Davis
Larry Palley
Former General Manager
Intel
John Selep
Operations Manager
HP
Thomas Alberts
Consultant
SBDC
Financed by
Cary Adams
Supported by
Head of MedStart Program
Implemented in cooperation with
SARTA
Getting Out of the Lab!
(3) Experts in the commercialization of biotech platform technologies
Name
Title
Institution
Greg McParland
Consultant
DSM Ventures
Fernando Garcia
Senior Director
Amyris
(4) Experts in vaccine manufacturing
Name
Title
Institution
Ann Arvin
PCAST Vaccinology Working
Group (Key Opinion Leader on
Vaccines)
Stanford
Misa Sugui
Associate Scientist
MedImmune
Floro Cataniag
Laboratory Manager
MedImmune
Financed by
Supported by
Implemented in cooperation with
Channels and Distribution
Conversation with Dr. Ann Arvin – Key Opinion Leader on vaccines
In the case of a pandemic:
 Vaccine manufacturers have to be producing vaccines for seasonal flu – regulatory
approval, QA, and validation need to be in place
 When a pandemic occurs, the government (BARDA) negotiates a manufacturing contract
with vaccine companies – number of doses, formulation, price, and time are agreed upon
 CDC provides the elucidated strain to the manufacturer
 FDA considers the pandemic flu vaccine to be a variation of the seasonal flu vaccine – new
regulatory approval is not necessary
 Vaccine manufacturers work with the new strain to ramp up production as quickly as
they can – takes 4-6 months
 Sterility and quality testing is performed for the produced vaccines – some tests are done
in-house and some are done by outside laboratories
 Vaccine is released
Financed by
Supported by
Implemented in cooperation with
Channels and Distribution
Getting the vaccines to the patients
 Vaccine manufacturers have contracts with wholesalers (i.e. McKesson
Corp.) to distribute the vaccines – distribution is not a cost for the
manufacturers, they hand over the product
 In the case of a pandemic, vaccines are also distributed through local
contracts with the state health departments
 They distribute the vaccines to hospitals and clinics, where they can be
administered to the patients
Financed by
Supported by
Implemented in cooperation with
Organizational Strategy
Conversation with Greg McParland – Former CEO of biotech platform company: the virtual
biotechnology company model
 “Starting out and for as long as you can, you should be a virtual company. You can have
contracts to outsource the downstream part of the process (purification, fill and finish, packaging,
etc.) ”
 “Keep your core technology and focus on using your manufacturing platform for protein
production”.
 Common practice in biotechnology – almost every company has contracts with CROs, CMOs,
marketing and distribution arrangements, etc.
 More flexibility – move quickly from failed avenues of research to more promising projects
 Startups partner with big pharma companies to complete clinical trials and take product to
market
“If you build it, they will come” – but only build the essential core that lets you control your
technology platform
Financed by
Supported by
Implemented in cooperation with
More Feedback
Conversation with Dr. Ann Arvin – Key Opinion Leader on vaccines
 Pain point: Reliability issues with traditional egg platform - willingness to move away to a
different manufacturing platform
 Pain point: Current platforms are not fast enough, cannot have an impact in case of a
pandemic - sense of urgency in finding a manufacturing platform that can produce
vaccines faster and at a large scale
 Given this landscape, we still believe our technology can solve a significant
problem in the vaccine market
Conversation with Dr. Misa Sugui & Dr. Floro Cataniag – MedImmune
 Pain point: attenuated virus platform is harder to work with, safety measures are more
stringent – would prefer recombinant subunit vaccines
 Wish: a faster process for vaccine production (our technology can help with this)
 Wish: a faster process for clinical trials and for approval of new drugs (this we can’t do
anything about)
 MedImmune is a possible partner - always looking for new vaccine production
technologies and new products to incorporate in their pipeline
Financed by
Supported by
Implemented in cooperation with
More Feedback
Conversation with Fernando Garcia – Amyris
 Biotech platform technology company
 First target product: drug for malaria, partnered with Sanofi to
commercialize
 Change in strategy: they have transitioned into making biofuels
 Why have they made this transition? We will follow up with one of the
founders of the company to find out
Financed by
Supported by
Implemented in cooperation with
Next Steps
We believe we have a good feel for our value proposition
We need to better understand how we can sell to customers and how
to establish these relationships, how partners’ decisions are made
– meeting with Sanofi Head of External R&D
Keep searching for a business model that will allow us to
commercialize our technology – looking for meetings with
companies that distribute/sell flu vaccine antigens for research
and diagnostic use, trying to determine market size
We need to talk to many more experts and customers…
Financed by
Supported by
Implemented in cooperation with
Business Canvas
Financed by
Supported by
Implemented in cooperation with
Interviews
Action
Motion
Customer Interaction Meetings:
1.
2.
3.
4.
5.
6.
Director of R&D of C/A partner
NETL Methane Hydrate RG
Ed Faust, Global Marketing, Siemens
Former GE Employee
Berkeley sensors group
Tim Fogarty, Director of IW Energy
Hypothesis Testing:
1. Ed Faust, Global Marketing,
Siemens
Financed by
Supported by
Planned Customer Interaction
Meetings:
1. Jeff Farbacher, CEO Accutran
2. Ed Faust, Global Marketing, Siemens
3. Charles Noll, Marcellus Shale Coalition
Planned Hypothesis Testing:
1. Dr. Gilad Kusne, NIST
2. Ann Truschel, Corporate Insurance
Broker
3. Tim Fogarty, Director of IW Energy
Implemented in cooperation with
Chemical,
Physical,
Thermal
….
Chemical
- Every significant market segment has
specific marketing agencies directed
towards selling them goods
Direct Marketing
Possible
Not Possible
[Too expensive]
Financed by
Supported by
Implemented in cooperation with
Chemical,
Physical,
Thermal
….
Chemical
- Every significant market segment has
specific marketing agencies directed
towards selling them goods
Direct Marketing
Possible
Not Possible
[Too expensive]
Financed by
Supported by
Implemented in cooperation with
Chemical,
Direct sales to plants typically is a very hard way
to generate
Physical,
scalable business in the sensors market.
Thermal
….
Typically much better to bundle
product into offerings from
Chemical
larger sensors
businesses
- Every
significant market segment has
specific marketing agencies directed
towards selling them goods
Agrees with current approach to this first market!
Direct Marketing
Possible
Not Possible
[Too expensive]
Financed by
Supported by
Implemented in cooperation with
Org. Chart – Current C/A Partner
CEO, CTO, CFO, etc. etc. etc.
Global Director of R&D
CEO,
Director of R&D
Director of Marketing
Director of Product
Service
Director of R&D
Engineers, etc. etc.
etc.
Financed by
Supported by
Implemented in cooperation with
Bob Dorf co-author of Steve Blank “The Entrepreneur’s Guide to Customer
Development”
Financed by
Supported by
Implemented in cooperation with
61
Useful links
 http://video.about.com/marketing/Tips-for-Customer-
Service-Best-Practices.htm
 http://www.crmtrends.com/crm.html
 ttp://www.businessballs.com/crmcustomerrelationshipm
anagement.htm
 Broady-Preston, J., Felice, J. and Marshall, S. (2006). Building
better customer relationships: case studies from Malta and the
UK. Library Management 27 (6/7): 430-445.
Financed by
Supported by
Implemented in cooperation with