Leaders' Blog

Is the social media craze being overdone in B2b technology marketing?

Geoff Anderson back for another post for the Technology Marketing Center.  This time I will explore the phenomenon of social media.  You can’t be associated with marketing these days and not be inundated with social media, and how the world has changed.  However, I suspect, particularly in the B2B space that it is crowding out what works, replacing it with a vehicle that is hard to measure.  While I wouldn’t advocate ignoring social media (Twitter and Facebook), I would caution against spending too much time and money.

For the B2C space, and doubly true in technology, there is no doubt that the early adopters and your best advocates are highly active (and visible) in the social realm.  From companies like Chrysler monitoring Twitter for grumbles and complaints, to Best Buy using it to track customer “hot spots”, it would seem that direct customer interaction is moving inexorably to the online realm.  But I fear that this is going too far, too fast, as you run the risk of tailoring your message to the most vocal group online (a very small group) ignoring the “watchers”, the vast majority, and completely missing potential customers who are not using social media (older people, or those who don’t use it for product research).  One often heard comment is that social media can accelerate the conversation between a company and a prospect.  Really?  It is already hard enough to get many companies on the phone.  Unless you have a bank of people monitoring a social media feed, it is difficult to imagine it being a conversation accelerator.

But what about the Business to Business market?  Here, the best leverage of social media is to work through your influencers.  The concept of market influencers is not new.  I have long exploited industry opinion leaders to get a multiplier effect.  Often they are offered early access to technology and products (they are invariably early adopters), and extra access to internal technical resources to ensure a positive experience.  With the advent and meteoric rise of Social Media, the opportunity to amplify these messages abounds.  And this is a very good use of social media.

All this is a boon to marketing in the Social age.  However, there is a risk of going too far, too fast.  I have seen a marketing team that had extensive domain knowledge, market segment savvy, and deep marketing skills gutted to bring in a new generation of social media marketing staff.  Wizards of Twitter, blogging and maintaining a Facebook presence, their lack of detailed product knowledge (indeed, disdain for product knowledge) has lead to poor lead generation (both numbers and quality).   Now they are scrambling to rebuild the core product marketing skills from zero.  When you see companies looking for “Directors of Social Marketing”, you see the risk of going too far.

Without doubt, leaders in Marketing need to adapt to the changing world.  But they should not be discouraged, as their skills and expertise remain crucial to an organization.  The key is to ensure that a social and traditional marketing team work together to cover all the vehicles. 

In summary, Marketing in the Social age has changed.  But the more it changes, the more it remains the same.  YOu are still driving brand and product awareness.  You are still tasked with generating leads.  You are still tasked with defining products that delight customers.  Trade publications, and the past masters of influence (industry analysts, media, trade shows) are in decline, being replaced by the new world.  However, the shift runs the risk of damaging your domain knowledge, and if overdone, alienating large swaths of your potential customers. 

Planning for an innovative 2012

Dr. Eugenia Jones signing in for the first technology marketing center post of 2012. Since I have the honor of starting the New Year, I’ll share with you what I would like to accomplish this year; an innovation in the biotechnology and medical device industry. I will focus on innovation in its broader context in anticipation of the TMC interview with Jay Paap, on January 31, where he will address the question, “Does gated product development kill innovation?”

 

Very few, if any, innovations are created de novo. As a scientist my new discoveries were fashioned from insights gain from a wide range of sources, their validity tested in the lab. When hard work and a little luck coalesced, occasionally a patent was generated. In business I gain insights come from watching the success and failures of those who share my passion for molecular diagnostics, as well as from an indiscriminate and voracious appetite for reading business books, magazines, journals, and attending webinars, seminars, and courses. 

 

Some of the best solutions to problems I have seen come from co-opting clever solutions from others, bundling them, and applying the bundle fearlessly to the problem I want to solve. As the saying goes “imitation is the sincerest form of flattery.” A bundled, or multi-pronged, approach does not dilute your efforts; rather it is necessary to produce the best whole product offering for your customers. Bundling innovative finance, process, and delivery practices with product offerings is on of the surest way to grow your business. (To read more about the types of innovation search- Larry Keeley, 10 types of Innovation.)

 

In the past two years on of the most innovative approaches in my arena has come from Meridian Biosciences, who compete in the infectious disease diagnostics space with giants like Roche, Abbott, and BD just to name a few. Meridian a mid-sized company, introduced a great enabling solution that allows clinical laboratories to adopt their new technology without purchasing capital equipment. Meridian developed a molecular diagnostic assays using a patent protected technology that can be run on equipment that is inexpensive to build and easy to maintain. By giving the equipment to customers, Meridian lowered the adoption hurdle significantly, and by designing the equipment with a small footprint and for a small test number the customer can try it out without feeling that they will have to commit to a large change. Change can be painful, and enabling a customer to bring in the equipment and order a few tests to see if how it fits in their work-flow was brilliant.

 

Of course it would have fallen flat without tests that are FDA approved, easy to use, fast and reliable. If a customer want to run more tests, you give them more machines, and if a machine break downs you ship them a new one. Meridian is currently expanding the product line of assays that run on their platform, adding a Group B Streptococcus assay, approved by the FDA at the end of 2011, to their C. difficile assay. Leveraging their platform, which you can think of as the razor, and expanding the product line, the equivalent of the razor blades, Meridian is poised to do well in 2012 in part because they lowered the adoption barrier by forgoing revenue from equipment sales, and enabled customers to purchase tests, which are just as good, if not better than, their competitors’.

 

One of my goals for 2012 is to apply the knowledge gained in 2011 to help one of my customers launch a customer solution that bundles several types of innovation, along with an innovative product offering, into the biotechnology and medical device space. Add a comment below; I love to hear what you think about how to best innovate solutions, and the most innovative solutions of 2011 were in your industry.  

 

5 directions to look as you plan for 2012

5 directions to look as you plan for 2012.

Hello everyone, Rob DeRobertis for the Technology Marketing Center

When Chris Halliwell sent me a note reminding me that it was my time to post a new blog entry, I was (and still am) in the mist of annual planning for 2012. I have another week before I can actually start thinking about the holidays and year end reflections. So here are 5 directions to look as you plan for 2012.

1) Look Backward

First assess where you are. What worked this year? Where were the successes? Where did things go astray? What safe guards have you put in place to make sure you don't repeat mistakes and what steps have you taken to continue on with those successes?

2) Look Left

Take a deep look at the competition. What are they saying about themselves? How are they positioning themselves and their products? What were their attack vectors? Are the competitors defining the market or are you?

http://www.technologymarketingcenter.com/resourcearchive/how-to-attack-with-competitive-positioning.php

3) Look Right

Look at your team. How have they grown? What strengths do you build upon and what skills do you build into the team? Make sure every member from the best to the weakest are growing, learning and enjoying their roles. Have forward discussions and define plans to help your team achieve not only the company's goals but their own personal goals.

4) Look Forward

One year from now, where do you want to be? What do you want customers thinking when they consider your company, your products and your team? Put yourself in the position of the "future you" and look back, how did you get there? Define a plan to get there.

5) Look Up

Look up at your customers. Where are they going? What challenges are they facing? What elements of the whole product that you deliver make their jobs easier and differentiate them in the market? Where are you falling short?

6) Never Look Down, especially if you suffer from vertigo in high places.

Whole Product vs. Razor Blades

Geoff Anderson back for his regularly scheduled installment of technology marketing observations at TMC. 

Today we will be focusing on the concepts around the whole product, and how important a complete ecosystem is in modern product marketing.  No, I am not going to talk about the razor blade model per se, but merely invoke it as a reference point.  For the record, Gillette pioneered the razor blade model.  Give away the shaver, and keep control of the IP around the blades.  Continuously improve the blades, providing consumers with motivation to repeatedly purchase the pricy blades.  The same model is being used in the inkjet printer world (where HP sells ink for more than $1400 an ounce). But does this translate as well to consumer technology goods?

Moving to the topic of the day:  Amazon launched and recently started shipping a product called the Kindle Fire.  It is a 7” color, Android OS based tablet designed to spar with the heavyweight in the market, the Apple iPad. The technical details: $199 price tag (estimated to be $10 to $50 less than the cost to produce, hence sold as a “loss leader”), 7” touchscreen, customized Android OS, two ports (one USB and one headphone jack), 8G of flash storage, and WiFi network connectivity.  There are a lot of concessions to meet the price point over a $500 iPad2, twin cameras, microphone, option for a cellular connection, a minimum of 16GB storage, and of course, the Apple ecosystem of applications and media.

Amazon is betting that the Kindle Fire will drive an expansion of sales and use of their media offerings.  If you are an Amazon Prime customer, you get access to streaming video, similar to what Netflix offers.  If you buy your music from Amazon's MP3 store, you will be able to access that wirelessly on your Kindle.  You will be able to buy applications from the Amazon Android market (but curiously, not Google’s Android market).  You will be able to buy and read books just like you can on the current Kindle.  All this sounds great, but, there is a dark cloud on the horizon.  Amazon has architected the device to make it difficult if not impossible to venture outside their walled garden of media options.  There is no memory card expansion, so it is difficult to get non-Amazon purchased media on the device.  Additionally, one of the strengths of the Android operating system is the ability to use the Google App store, and that will be stifled (naturally, the the technically minded users will figure out how to break the handcuffs to the Amazon media markets) leaving users with a limited horizon of use.  In short, Amazon is subsidizing the sale of the devices to drive their core competency, media consumption, and the attendant revenues that generates.

Compare this with Apple.  The iPad is wildly popular, highly profitable, and by any measures a huge success.  Apple indeed runs the Itunes music store, and has sold many billions of songs, movies, TV shows, books, applications.  It is THE platform to develop for, as many success stories have painted in past writings.  However, if you read Apple’s annual report, the ITMS is profitable, but it is barely a blip on the radar screen with their revenues.  Apple has always been, and continues to be a hardware company that gets the whole product concept.  Build great products, with a set of features that entice consumers.  Wrap it in services and value added offerings.  Grow an independent ecosystem of interested entrepreneurs, and people will flock to your products.  Apple is the anti-razor blade model.  Make your money on the hardware, add value to lock users to your world, but make it as non-obtrusive as possible.

Time will tell whether Amazon can drive enough content revenue with the Fire to justify the offsetting subsidization that they are doing on the hardware.  There is no doubt that the Fire is going to be a hot seller for this holiday season, but will the initial surge last, and will Amazon be able to continuously improve the package and platform to match the pace of Apple?  Will they engender the same loyalty and passion of the Apple iPad users? Will they prove that the consumption of media can subsidize hardware? Or will the restrictions and limitations around media and apps hamper customer satisfaction?

As a product manager, the concept of the whole product, and the trappings that go with it are core to my belief system and, as is proven over and over again, ultimately the success of a product offering.  Do it well, and you will easily navigate the minefield of the competitive landscape.  I will be certainly be watching the introduction, and the initial trajectory of the Kindle Fire to see if Amazon can wrap the whole product into an ecosystem where their success is on how much adoption of the ancillary product offerings (the media).  Exciting times indeed.

Healthcare marketing. Why what you learn in courses may not apply.

Hello there, this is Dr. Eugenia Jones looking at biotechnology and medical device marketing for the Technology Marketing Center. When I first went for training in healthcare marketing I was already working in industry and although the courses were well taught there was something that just  didn't resonant. It took me a while to figure out what was missing. 

The healthcare industry is comprised of several sectors, including pharmaceutics, medical devices and diagnostics. These sectors are  subject to similar governmental regulations, which shapes our marketing efforts and launch plans, but there are significant differences. Healthcare marketing courses rely heavily on pharmaceutical examples, leaving students like me with the impression that the marketing techniques being taught apply across all sectors in the industry. But I knew looking around at other device and diagnostic marketing that this wasn't case and I wondered what made pharma marketing different from devices and diagnostics.

It turns out the difference is fundamental, easily overlooked, and yet should sculpt every element of a medical diagnostic and device marketing efforts. Unlike pharmaceuticals, medical diagnostics and  devices can be continually improved to address unmet needs that arise over time. It bears repeating. A pharmaceutic, a drug, has a defined set characteristics, and rarely can be "improved." You can alter the delivery vehicles, and occasionally package it with another drug to improve performance, but that is it. 

Take a moment. Imagine you have two products  with similar development costs and patent protection but the only way to extend patent protection, one of your key competitive advantages, for one product is to find a use for childhood illness which gets you a couple of extra years, while the other product can be continually reengineered, improved to adapt to the prevailing needs of a segment, e.g. high throughput automation versus point of care diagnostics. Would your marketing approach be the same for both types of products, after all you’re selling to the same population, doctor’s and patients?  Would you manage your brand and the types of products you launch differently? I sure do.

One of the great advantages of being in medical diagnostics and devices is that I can apply the best practices from pharmaceutical marketing I learned in healthcare marketing course, e,g, how to leverage opinion leaders at launch to drive adoption and market penetration, and meld those with the best practices from other technology marketing  sectors. In reality in the pharmaceutical industry it is very difficult to launch a real line extension, as opposed to virtual line extension e.g. Nexium and Prilosec. In the device or diagnostic sectors product line extensions are the norm, allowing businesses to address the unmet needs of a particular segment without sacrificing other segments. This fundamental difference should significantly impact how you approach customers and how you devise a marketing plan.

Not all is lost from taking healthcare marketing courses. Pharmaceutical marketing efforts excel at translating clinical trial data into actionable physicians drivers. In addition Pharma marketers have excelled in direct to consumer marketing, a path very few medical devices have undertaken, with the exception of diabetes diagnostic supplies. I have no experience with direct to consumer marketing, and would like to learn how to ethically use this channel to drive adoption and sales of some the amazing diagnostic products it has been my privilege to work on. But I wonder, how to ethically market diagnostic and medical devices directly to consumers? What do you think and what lessons would take away from Pharma's direct to consumer marketing efforts? 

 

 

5 Questions to consider in defining your marketing strategy

Hello everyone, Rob DeRobertis for the Technology Marketing Center.

For 13 years I drove by a store whose motto was "Good Stuff Cheap". The sign made me cringe every time I looked at it. But there it sat, and there it still sits bragging that you can get good stuff cheap there. I've since changed the direction I travel to work, not because of the store but of other reasons.

So why did I cringe when I saw that sign, it's because I have spent my career trying to market on value and "Good Stuff Cheap" is the antithesis of such a claim.

My focus on marketing on value began after I read the HBS paper "Marketing Success Through Differentiation of Anything" by Theodore Levitt. This paper was required reading in a "Strategic Marketing" class I was taking at the AT&T school of business. The professor for this class, a Robert Parkett, was an entrepreneur who found ways to differentiate any product… including pizza. The class was how to think differently to do just that. Anyway, the impact of the class and paper was substantial and has driven me to always look at ways to sell for value.

The Technology Marketing Center embodies selling to value. This graphic which I borrowed with permission from the TMC, describes the process in setting and driving value marketing activities

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Used with permission by the Technology Marketing Center.

Here are 5 questions to consider in defining your marketing strategy.

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1) Company Value

What is the value of your company's brand? Is your company considered a premium brand or "good stuff cheap" company.

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2) Product Value

What is the value of the products and product family brands? Will customers pay more for key features?

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3) Industry Value

How do you impact your industry? Is your company considered a leader within the market you service?

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4) Application Value

In the problems you solve do they add value to your customer's application?

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5) Customer Value

Do your customer value working with your company? Do customers perceive that working with your company will give them a competitive advantage?

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Knowing the answers to these questions are critical in defining a sound marketing strategy. You can be a "Good Stuff Cheap Company". You will need to focus on low-cost delivery of product to be successful and be willing to participate with minimal overhead. If you choose to be a "Value Based" company you will need to focus on service and innovation. To deliver this you will need a higher overhead but hopefully the margins you receive substantially offsets that added cost. In other words, whichever you select, your choice must map to your business model or your strategy will fail.

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So what kind of marketer are you?

Blackberry's Marketing Warfare Options

Geoff Anderson, checking in for the  Technology Marketing Center and the next installment of Smartphone Theater.  Last time I blogged about the smartphone market was this post from November 22, 2010.  There I was speculating on the rise of Android based phones, and the impact on Apple.  One of the conclusions was that Apple’s sales volume have been rising, but the sheer number of phones offered by different carriers with Android underpinnings, was driving that phone OS into the lead.  The growth of the Smartphone market was (and is still) phenomenal, but the one player who struggled was RIM with the veritable Blackberry.

In this installment, we will be looking at the actions and response from the market around the Blackberry phones.  First, a little pedantic review.  From the first phones that were also Blackberry email devices until the introduction of the iPhone in 2007, RIM had enjoyed a pretty wide open market.  They had the lock on enterprise and government space with impeccable credentials in security, and fine granular control.

Much ink has been spilled on the woes of RIM, but let’s look at it from how they might respond with a marketing hat on.  From the MTP course review of Ries & Trout, you learn how marketing is analogous to warfare, and that competitive tactics often align with battlefield tactics.  Instead of in famous locations (i.e. Battle of the Bulge), marketing battles take place in the minds of the consumer.

Like in a pre battle plan, the top companies are mapped and ranked by position, and each firm has well defined goals:

• Number 1 – Market leader – goal: market domination
• Number 2 – Follower – goal: increased market share
• Number 3 – Also ran – goal: profitable survival
• Number 4 (and beyond) – goal: survival

The chief problem facing RIM today is that they used to be the top firm, with market domination, and amazing mindshare of the customer base.  However, today, while they are still profitable, they have dropped to a dismal third in the market share, and have yet to really grasp that they can no longer behave like the market leader.

The only real path forward for them is the flanking tactic, or segmentation strategy, attempting to redefine the battle in a way that they can be successful.  The time for them to behave defensively, or offensively have irretrievably gone by.

There are three principles of an effective flanking effort:

1. A flanking maneuver is best made in an uncontested area.  This means moving the product into a new category, one that doesn’t compete with the market leader.  Unfortunately, the RIM response was the Playbook tablet, another “me too” product offering, and one where the leader in the space has uncontested dominance.
2. A flanking move should have an element of surprise.  Perhaps RIM is working on a tectonic shift, under cover, but they have been quite vocal about their plans and strategies (new OS’s, acquisition of technology to help bridge the gaps, and the usual pre release announcements.  To be fair, for a large privately held company, this is a very difficult criteria to adhere to.
3. Follow-through is equally as important as the attack itself.  Here is another core principle of the flanking maneuver that RIM has just not executed on.  They have released lots of different handsets, and OS upgrades, but the pattern appears to be more of a scatter gun approach, rather than a coordinated,  all hands stage left culture shift.

RIM will not disappear from the market, and Blackberry will retain some crucial segments (finance, government being the two largest), but it seems pretty clear that they will never be able to reset the clock to early 2007 where they were incontrovertibly the dominant player.  All their responses have been slow, and, more importantly, have failed to recapture the mindshare they once enjoyed.  

Until next time, happy marketing!

Drug Discovery Consumables and Kenny Rogers, Marketing Guru

Dr. Eugenia Jones signing in for this month’s look at bioechnology and medical device markets for the technology marketing center. I usually discuss a particular market dynamic of interest; today's post is not so much about a market as it is about habits and embracing change. I hope you enjoy.

It's been a rough year if you sell consumables to the drug discovery market. Big Pharma has changed their discovery process; gone are the days of distributed R&D development groups at every branch office, each looking at different targets, using similar techniques. The tough economy, and the drive for faster, less expensive development has driven centralization and outsourcing. As a result your big Pharma customer is ordering fewer consumables. In addition, big and medium Pharma are teaming up with academic institutions to run compound screens, and that nice discount you give academics is impacting your ASP and margin, as academics account for a greater percent of your sales. This change in how big Pharma runs it's R&D should have come as no great surprise, but some large life sciences consumables companies seem to have been caught napping, as demonstrated by their failure to deliver their Q1 and Q2 revenue numbers. 

What if you were a product manager in this position? What would you do? I've always liked Kenny Rogers song "The Gambler"- the lyrics resonate: you have to know when to hold them, know when hold them, know when to walk away, and know when to run. What I would do is look across my product portfolio that addressed this customer segment and ask should I (Hold, Fold, Walk, Run). Hold products are differentiated, high margin, number 1 or 2 sellers on the market. Fold products have a small market share, the margin may not be as good but they generate pull through of high margin products. Talk to your competitors and see if they would like to purchase your fold products to round out their portfolio. Walk away from products that are not differentiated, you are 1 or 2 in the market, there are a lot of competitors, some who are competing on price. By walk away continue selling until such a time as the product becomes a "run away" from product. Run away from products that are low margin, low market share, and old. These products need to be culled from the list so that you and your sales team can spend time more wisely. As the song says "The secret to surviving is knowing what to throw away and knowing what to keep."

The trick lies in knowing what to throw away, what to keep and what to build. Throwing away things can be hard, but if you can't find a new market for an old product fold it. All too often in times of plenty, like the past 10 years in the biotech consumables market, products never see an end-of-life. Teams are too busy building the next latest and greatest thing to think about getting rid of the old products, whose production clogs manufacturing and whose presence litters the catalog. Discontinuing products is a great opportunity to talk to your loyal customers and find out what needs the product fills, and what alternatives you have available; in other words gather voice of customer information. Every once in a while, a conversation with a loyal user can reveal benefits and features you and your sales team were unaware of, prompting you to try different tactics. Alternatively you can find out what the customer needs from an alternative to get him to change and build that alternative.  

It's time to start gearing up for next year, think about including a little Kenny Rogers review of your portfolio, it will do it's health a world of good.

Until Next Time.

If selling hamburgers were a B to B exercise, a short story.

Hello all, Rob DeRobertis back for the Technology Marketing Center.  I originally published this short story Jan 5, 2007 on my old blog. I've been thinking about this scenario lately and still think it is true today so instead of another Five Things In Marketing, here is a short story about hamburgers.

If selling hamburgers were a Business to Business exercise, the sales scenario might look like the following:

There are two teams in the engineering community. One likes charbroiled hamburgers, the other likes fried hamburgers. The teams scoff at each other because they both believe they have a better palate. The purchasing department doesn't care about what kind of hamburger that is purchase but knows that if they wait until the end of the month when the hamburger franchise reports their revenue; they can get a better price on hamburgers. The product managers want the hamburgers eaten and eaten on time. They worry about the two engineering teams, the apparent inefficiencies since the engineers aren't working together and the product managers are dealing with the sales team screaming for the hamburgers to be eaten.

The managers are worried about picking the right hamburgers because a promotion is pending for one of them. One manager always buys charbroiled and believe that since the people at the counter are friendly it will always taste great. The other manager likes fried hamburgers because of the special sauce. He also likes the fact that they will allow him to customize the hamburger. He believes that choosing this hamburger will create a competitive advantage and get him promoted. In the mean time the engineers are working out various value meals.

The General Manager doesn't eat hamburgers, he is a vegetarian. He doesn't care what hamburgers are eaten. He does care if these hamburgers will help increase market share and grow profits faster than the competition. He is also worried that since they buy a lot french-fries from the fried hamburger company that he doesn't upset the balance. He does work out in the gym with the fried franchise owner and knows him well but says it is the decision of the engineers.

The product managers call a review meeting that includes the engineers, managers, purchasing people and general manager. It is determined that the value meal of the fried hamburger looks the most promising. The team who were considering charbroiled hamburgers leave frustrated and tell the people at the charbroiled hamburger restaurant not to worry that they will be back. Once returning from lunch, the charbroiled hamburger contingent is re-assigned to chicken.

The fried hamburger team spends the next 18 months negotiating contracts, getting place setting right, visiting the fried hamburger restaurant many times asking many questions and coming up with the best value meal. They then place their order for 5 hamburgers on the last day of the month. The hamburgers are wrapped in a special package and shipped priority mail to the factory where the quality inspection team approve deliver and release payment.

Finance releases payment 90 days later.

 

Disruptive Technologies

Geoff Anderson back for the Technology Marketing Center after a much longer than anticipated hiatus.  Last time I was here, I talked about how a disruption in service can lead to opportunities, as well as how over reliance on a particular technology can leave you vulnerable, regardless of how reliable it is.  Today I will talk about disruptive technologies.

As readers of Geoff Moore’s “Crossing the Chasm” we are all familiar with the diffusion of new technologies.  It describes an adoption curve, and process that a technology offering will “likely” follow in the market.  Naturally, there are exceptions, and today we will discuss some of these.  If we look back a decade or more, and recall the world of telephony, that was the dawning of the age of Voice over IP or VoIP.  Lead by Cisco Systems, it was a classic example of a disruptive technology.  Until then, there were two distinct networks in the typical enterprise, a data network, and a phone network.  This meant duplication of wiring, of staffing (as telephony departments were traditionally not part of IT), and connections to the outside world.  The original disruption was to replace the inside the walls telephone wiring with a system that provided the same service over your existing data network.  The foundation for this was well understood, and Cisco, as the premier supplier to companies of their networking gear, had all the pieces in play to deliver on this convergence. 

Clearly, it was a successful play, and today, overwhelmingly organizations are buying and deploying VoIP systems.  Today the trend is once again in the replacement of traditional telephony, but outside the building.  A technology called “SIP Trunking” is replacing the traditional Time Division Multiplexing (TDM) connections to the outside world with essentially an ethernet connection.  Many reasons for this, but primarily to reduce the toll and termination charges of a phone call and replace it with a metered bandwidth connection.  This is playing out rapidly, and causing the carriers (the ILECs and RBOC’s in the US) to adjust their business model and product offering.

Another disruptive technology is also playing out in the computing space.  If you think about the number of pad devices being sold, and the tectonic shift away from full feature computers, it is a remarkable evolution.  In the first 9 months of 2010, Apple sold (not just shipped) 15.2M iPad’s.  While we don’t have numbers for 2011 yet, the introduction of the second iteration is clearly on a similar trajectory, and combined with the smattering of Android based devices, it is clear that the netbook and low to mid range laptop market is bearing the brunt of this climb.  Apple hit a trifecta in their initial release.  It was a compelling package (size/weight/performance), coupled with a strong ecosystem to support it with applications (at launch a ridiculous number of optimized applications were available), and provided the features that a large fraction of consumers use computers for (email, web browsing, media consumption).  While they didn’t invent the space, once again, they released a product that crossed the chasm, and did it in an enormous gesture. 

All legacy markets are ripe for disruptions.  However, as should be obvious, disruptions are difficult to plan for in advance.  Sometimes they are well executed flanking maneuvers, sometimes they are completely unexpected entries, and yet other times, they are technologies that shouldn’t be disruptive to the market (i.e. the existing players should have seen it coming).  However they arrive, they provide opportunities for the leaders, and fast followers, and bewilderment for the entrenched players who are left behind.  Until next time, happy marketing!