Dec 2007
Bose: A great company experience
Clearly I was an early adopter of their Noise Canceling technology (I also own the QC1) but they did not punish me for it. With a little bit of tugging they offered to replace my 4-year old headset with a brand new set for free. Gladly my new headset arrived before a 5 hour plane ride to the east coast. Another experience like this with Bose came when I moved from Europe to the US about 12 years ago, I wanted to exchange my 901 equalizer with a 110 volt one (so I did not need to down-convert my 220 volt european equalizer). Again, here Bose offered to replace the equalizer free of charge.
Whether you like the sound of Bose is your own decision, but the flexibility of this, still private company to balance earnings with a sincere interest in keeping its customers happy is admirable. More fundamentally, successful companies understand that building a lasting brand means they pay attention to customer retention. Apple is doing similar things by turning part of their retail store into a support center. Great businesses don't look at support as a cost center but as a way to satisfy customer experience and have them coming back for more.
Develop an experience, not just a product
Thursday - December 13, 2007 Filed in: Strategy
| Positioning
My 3 year old daughter uses my iPhone to play music
videos and YouTube videos and has not touched a PC
(or better, a Mac) yet. With the same content
available on either she's obviously seen me operate
my Mac and looks over my shoulder now and then, but
finds all the keys and even the "Magic-mouse"
complicated. Clearly a usage experience is more
important to her than shear processing power. Sounds
familiar doesn't it? Nintendo anyone?
What I see in so many early business plans today is the old-fashioned notion of deep technology expertise, something most traditional investors still harp on. I see too many BMW engines being developed without attention being paid to the development of The Ultimate Driving Experience®. True, you can't build the driving experience without great engines, but BMW, like no other vendor understands that the total experience is the selling point. In the end, technology will become commoditized and its differentiation will be determined by the way it interacts with content, media, social network, end-users to create a well designed user experience.
Apple is another company that understands that focus on user experience very well. Its products are a piece of art, its function (to a novice) is at least competitive. Buying a Mac is an experience, and so is using it. A much better experience than buying a PC in every way. The box your Mac comes is even a work of art, the way it folds open, the new materials, everything builds to the experience. As a customer you feel special, owning an iPod with your name engrave on it and all your music in it. And that is what Apple customers are buying into: feeling special and appreciated. Attention paid to you!
Now every market segment has its own definition of user experience, so don't go do what Apple does before you understand how you can differentiate. But every software, service or content vendor should consider building a unique customer experience that in the end - sells more. It's a CEO level responsibility because it involves making sizable investments in complementary areas, not just a marketing ploy. The days of just selling a product are over.
What I see in so many early business plans today is the old-fashioned notion of deep technology expertise, something most traditional investors still harp on. I see too many BMW engines being developed without attention being paid to the development of The Ultimate Driving Experience®. True, you can't build the driving experience without great engines, but BMW, like no other vendor understands that the total experience is the selling point. In the end, technology will become commoditized and its differentiation will be determined by the way it interacts with content, media, social network, end-users to create a well designed user experience.
Apple is another company that understands that focus on user experience very well. Its products are a piece of art, its function (to a novice) is at least competitive. Buying a Mac is an experience, and so is using it. A much better experience than buying a PC in every way. The box your Mac comes is even a work of art, the way it folds open, the new materials, everything builds to the experience. As a customer you feel special, owning an iPod with your name engrave on it and all your music in it. And that is what Apple customers are buying into: feeling special and appreciated. Attention paid to you!
Now every market segment has its own definition of user experience, so don't go do what Apple does before you understand how you can differentiate. But every software, service or content vendor should consider building a unique customer experience that in the end - sells more. It's a CEO level responsibility because it involves making sizable investments in complementary areas, not just a marketing ploy. The days of just selling a product are over.
Pairing chefs and cooks in technology
In the food industry there is a clear distinction between a chef and a cook. A chef invents new dishes from scratch through experimentation, deep knowledge and experience. A cook takes a few successful recipes, adapts them to his beliefs and serves them up to a large audience. Both are fundable business models, but they rely on different factors to become successful.
In technology this distinction is not often thought about when funding companies. It would be very easy to judge that a chef is always a better innovator to invest in, but I find the opposite to be true in many scenarios I've run into. Different investment and growth scenarios are to be expected from investing in Daniel Boulud's new restaurant in China versus the growing chain of Fleming's restaurants, even though they taylor to roughly the same price points successfully.
Research institutes spin out great chefs, but struggle with scale and mass adoption. Great sales, marketing and business founders in technology usually depend on the continuous innovation only the chefs can provide. The workings of VC funds forces us to combine the chefs with cooks so that the ecosystem provides both continuous innovation and mass adoption at an early stage.
As a CEO, we provide the leadership and direction that pairs the chef and cooks, all you need to do is: do what you do well. Just like Remy in Ratatouille, we will pull your hair to ensure the right dishes are produced - on time.