The way you set prices doesn’t just influence demand it also effects consumption: ie. the extent to which your users actually use your service or you products that they’ve paid for and if they come back for more.

Let’s take this example: 2 friends: Jill and Jane get a membership to a local gym. Jill gets a monthly membership at 100USD/month and Jane pays a 1000 USD for the yearly membership upfront. Now, fast forward 6 months later: who is more likely to remain committed to their exercise schedules? Given the motivations of both J’s is the same, there is a higher likelihood that Jane (yearly membership) drops off her regimen first. Psychology tests have shown that Jane in an attempt to extract the most value from her higher one time payment will peak at a certain time and stop exercising as frequently at the gym. Jill on the other hand continues to use the gym and is happy with the value that she is gaining from her purchase. Jill eventually sticks on with her monthly plan for another 2 years at the same gym.

The lesson learned above is that not only is it critical to price correctly so that you target the Jill’s of the world to purchase today, but, it is also critical to make these one time buyers “stick”. Whether it is a one time purchase of a chair online or a discounted golf club bought online it is important to price correctly for “that” consumer and personalize the visit to an extent that the consumer has subliminally been affected positively.

The first and foremost step in this process is to “price correctly“. To effect the behaviour of the user positively a simple dumb discount that treats all visitors alike is just not going to cut it. This is the precise problem we’re tackling at Runa: understanding how to enable merchants to make better discounting decisions in real time for individual consumers that visit their sites and to increase lifetime value of these customers while at the same time maximizing their profit margins.

I’ll be writing about some basic techniques on how simple dumb discounting can help your bottom line and then provide some measurement of how you can further optimize this $ value by using Runa’s SaaS campaigns (I’m talking about a 200% increase in profit by using Runa in some cases :) ).

I believe there is value in understanding this lifecycle, especially if you’re considering working in an early stage b2b startup or planning on starting one yourself. It helps you prepare (maybe?) for what lies ahead. :). I began searching for answers to this question by looking at a famous theory in Psychology - Maslow’s heirarchy of needs. Maslow articulated his observations of humans’ innate curiosity, and, his seminal paper on the subject led to a famous pyramid representation that allowed simple people like me to understand the hierarchy of needs for individuals.

A startup also has relatively clear stages of development and in each stage of its development certain fundamental approaches or strategies emerge.

High Level Concept:
This is really the aha-moment. The founders get together and brainstorm an initial concept focusing on a target audience. Friends and family could be the initial pre-beta customers. While there is a high level concept the initial team is also curious in multiple areas in this space so ideas flay around every few hours and yes they’re all probably being thought about seriously. The team really needs to be able to respond with early prototypes that address a pain point that your customers may be facing. Now, this is just one pain point out of many but atleast there is value in delivering the working prototype and showcasing it to your pre-beta customer for feedback. As long as every one in the team is aware that this experimentation phase has only just begun there will be less battered egos to work with as the company evolves.

Multiple Concepts:
Curiosity in multiple areas within your space will invariably give rise to looking at the problem from multiple dimensions and different angles. This gives birth to new ideas which when rapidly implemented will provide the team with multiple prototypes each solving a certain real world problem or a set of problems for your customers. With this larger scope of solutions you can speak to more pre-beta customers and possibly sign more of them onboard, this adds to the feedback loop and the framework is in place to understand the market needs and tailor a solution based on your own, now mature, understanding. Sticking to the fundamentals: always prioritizing stories, stories always delivering business value and doing the absolute minimum to make each prototype functional is key. If you’re in a startup and wondering how to keep your processes lean and absolutely doing the most obvious thing: you have to read what Amit has to say about Post Modern Software development (more on PMS :) - in a later post).

Base Concept:
This in my mind is the most important stage in the growth of a b2b startup. Having worked on multiple concepts, created prototypes and validated them with pre-beta customers there is an emergence of a base concept that not only satisfies a large part of the total addressable market in your domain but the business model is now in sync with your product vision. This is most definitely NOT the final product but it provides enough clarity to build out a base architecture on which your product will be built. You can now more consciously build strategic relationships with partners since you understand what the “core” of your business is. At this stage your technical team can really start to flex its muscle and build features that are production ready and that can scale to a 10x factor much easily. The pre-beta customers can now be migrated to your base architecture and the features that they were using in the prototypes must be migrated over seamlessly. The feedback loop from customers at this stage is almost constantly live and new features are being prioritized and the backlog starts to look real. The company has also evolved into a more complete entity with the ability to hire when necessary and can justify the added resources with a clear return on investment. More importantly the startup can also justify that every new member added on is doing justice to the Equity Equation.

Core Mission:
The startup has now passed the phase of esteem and reached self-actualization. Here  there is a clear focus in terms of feature set, serious prioritization sessions which have a clear impact on customers, your sales pipeline and customer support. Here the startup as a whole is an entity which is self-optimizing. Constantly optimizing customer needs, technology throughput, infrastructure scaling, market messaging and most importantly its own lean and agile internal processes.

Grokking these phases has helped me understand where to focus and when to get agitated for change. Building enterprise software in a large Fortune 500 company is literally light years away from building software in a rapidly changing business context in an early stage startup. I am not passing judgement on which is better or worse, or more efficient, just highlighting some of the obvious growth pains that are evident while you build a product and hoping to learn from other people who have also faced these (or similar) phases of growth in an early stage startup.

Time waster article to prove it here… wait, this one’s longer.

The world is complex, dynamic, multidimensional; the paper is static, flat. How are we to represent the rich visual world of experience and measurement on mere flatland?

is worth a read.

Get your own copy.

Enter with Care

Google over the past 10 years has completely reshaped the way the internet is used by the world. Providing applications that are easy to use, spiffy and just a complete departure from what was out there before they entered the fray. With Android, Google entered the OS market and they did it in the already over fragmented and completely dysfunctional mobile OS market. The mobile segment is obviously very appealing to Google and the potential for advertising on devices that are context aware is huge, understandably Google wants to develop a platform that allows them to serve ads more easily - the OS is the perfect entry point for this and hence they’re expending energy building it.

Software by Committee

Building a great piece of software very rarely occurs using a committee style approach. You know the saying “shit trickles downhill”, well the way committee driven, consortium style OS’es are built (look at Symbian for eg.) compounds this to “giant quantities of shit acts as a mudslide” and destroys your original product idea. That’s precisely what’s happening with Android. A bunch of MBA’s from different companies get together in a room and argue about some inane feature that they absolutely must have and the entire creative process of software development comes to an abrupt stop.  Google’s now dealing with issues that MS deals with. Both companies have a ton of smart people who know how to build great software but they also have battalions of MBA types to slow them down.

They say partnerships are key in the mobile OS space

Building partnerships with carriers and OEM’s is the key to building a great mobile platform they said… it’s important to listen to the carriers and have them control the software that goes on the devices they said…

The Mobile OS space is like a pseudo-religion with all kinds of prophet messiah types proselytising about what’s good for the consumers and how to increase RPU (revenue per user) etc. Then one day Apple joins the fray and proves how little of this is true. Build a consumer device that truly is outstanding and carriers and all the other committees that you possibly had to deal with just prostrate themselves. Is the iPhone-iTunes a great platform - yes it is. Does it make money for both the carriers and the device manufacturer - yes it does. So what’s all this mumbo-jumbo with partnerships, committees and alliances that Google’s got itself into?

Dealing with nuances

Ask anyone at Symbian on advice about dealing with an alliance that governs the features that go into their OS. It is a game of catering to the nuances. Small intricate details that a carrier wants to restrict or add or remove. More than half the energy expended by the team is spent on getting things to work. The nuance is satisfied for the alliance member but the experience for the end user is absolutely crap. Instead of focusing on the consumer the development team is focused on how to ensure that the agreements with the alliance members are not voided. Google would have done better to build an Android Phone themselves and see adoption amongst consumers. I for one would have bought a Google Android phone just to try out the software on it. Now, I can barely think about wasting that money there… Google is just a member of the OHA and there are plenty of loud voices on that team to ensure that not all the software will have originated from the Google fortress.

The reason for the delays are summed up by none other than Andy Rubin on GigaOm recently :

“This is where the pain happens,” Andy Rubin, Google’s director of mobile platforms told WSJ. “We are very, very close.” He was talking about adding features etc requested by carrier partners. I think this is why Jobs was smart in being tyrannical and ignoring carrier requests when it came to software. Google apparently can’t afford to ignore partner requests.

What’s next for Android?

Well, I agree with Andy about being close to a shippable product at this moment but given the alliance route they have chosen they will always be very very close i.e. close in terms of satisfying their carrier and OEM bed-mates and somewhat close in satisfying their consumers: none will ever really be happy with their product. It’ll be a Symbian like progression of mundane software releases and tons of heartache for all the developers involved.

I hope I am wrong for all the smart devs involved in that team!

The WatchNow feature only works on Internet Explorer, buffering takes way too long - it took 1:25mins for a movie to be ready to be played on my 10mbs line at home.

People at NetFlix: wake up! Go look at Hulu, watchTVSitcoms, joox, surfthechannel and compare your sucky, sub-par, paid service against what these guys provide for free!

Attending overtheair last weekend changed my view of this. The mobile web is real and what makes it exciting this time around is the inclusion of the millions of web developers into the mobile fold. The number of mobile websites (not .mobi) that were launched last year since the arrival of the iphone has been tremendous, these are sites catering specifically to the mobile audience and serving a mobile audience only.

The pulse of the conference was certainly around web technologies and their utilization in the mobile space. There was a lot of talk around browser compatibility and web standards which was unheard of in previous mobile conferences, we used to bore ourselves to death talking about operator walled gardens and the tyranny they impose on mobile content developers.

I feel we are at a fork in the road here and the manufacturers and the OS providers need to make a choice:

a. continue to meet demand for browsers on mobile devices with the traditional browser model in mind. ie. render w3c standard pages on devices etc. and that’s it.

or

b. create a new breed of browsers for devices which are standard compliant and which have unrestricted access to native constructs like - sms, location from triangulation, location from gps, cameras, bluetooth

Just think of the possibilities this will open up…

Not only will we be able to build applications that port easily from device to device as long as the web standards are adhered to (..has its own issues, but, I would take this problem over the porting hell that is moving applications in j2me from one manufacturers stack to another) but, mobile web apps will actually be using the capabilities of the device. Location based webapps that actually use the location of the device directly, address books and calendars that sync with your favourite web-service directly - the list is endless. All the web-services you consume on the web but tailored specifically to your devices browser platform.

It also represents a chance to leap-frog over a decades worth of lack of tools and best practices in the mobile space and join a community of web developers that is alive and teeming with ideas and open source initiatives. The developers at apple, ms and google need to think of ways to make the mobile web more accessible through the devices they support, but, not just to the point of rendering the pages but allowing a more direct interaction between javascript (maybe>) and the devices native app store. Opera as a platform was supposed to address this very problem, but I think they’ve failed or given up that fight and are focused on the status quo.

It will take a revolutionary idea for a product/device or the release of a more complete mobile browser SDK to act as the catalyst in this process. Rethinking the browser on the mobile device is going to provide options for both consumers and content developers. The carriers can gain as well with increased ARPU with data plans that users will need to access all this web content.

компютри втора употреба

Not all is perfect with both these apps, however, we have over 45 Doctors on xamcram revising for their membership exams and we (Eugene, Sean, Farooq or I) don’t know 35 of them, i.e. real people on the net that are actually using the xamcram service and finding it useful and returning for more visits and learning sessions. 

The content on the website is truly exceptional and we’re adding to it as fast as we possibly can. The current version is really awesome and Farooq and I are getting feedback from our users about what they like and what they would like changed. The feedback loop is getting stronger and louder which is exactly what we need!

However, due to unavoidable circumstances, i.e. getting completely goggle eyed on beer while pairing with the ultimate Dan Bodart, the app will have to be completed and released another day :)/

I will be submitting it for review in the OverTheAir all-night-hackathon to see what happens (what the hell…)

Sitting in the fireeagle presentation - seems like an awesome API for location aware applications (bought by yahoo recently) and I might get some invitation codes if anyone needs one to try building an application around it make your existing applications location aware.