I’ve been looking for relevance of
The three forces he mentions are democratization of production, democratizationof distribution, and connectionsbetween supply and demand. I can actually see correlations between thoseforces and social software systems, which aren’t hard based on the manysuggestions he makes:
- Make it easy for the members of a community to create content/information
- Make it easy for members to distribute that information, or help them distribute/syndicate it
- Provide mechanisms for filtering niches from some of the variety in your community.
- Allow people to create their own content spaces; pick your service: blog, wiki, forums, etc.
- Allow people to share/syndicate that content: URLs, RSS
- Provide a filtering mechanism, a search engine or other mechanisms to find specific subsets of information.
This just fulfils the applicability of the forces, but Ineed to still explain the application of the strategy to software products.
Many software applications are consumed in a different waythan content focused items like books, movies, music, etc. Most obviously, theyare usually tools used to accomplish, build, or fulfill something. Not all fitthis of course: computer games are still primarily a similarentertainment-consumption model. However, tools that a vendor, say IBM,produces are typically used to create or manage other things like applications,data, or knowledge.
This means that you can usually reuse a piece of software todo different tasks (assuming it is not restricted by the license-usage) if youwant to. More so, the deployment of such tools can be different for eachcustomer; and unless there is consulting involved, most vendors do not keepprecise track of exactly how they are deployed. Instead they tend to focus onthe type and number of products purchased (and, very often, how to get thecustomer to buy more).
Across the whole industry however, there is some level ofparity. Many customers with similar businesses may deploy the product insimilar fashion, or come across similar issues, a concordance of some sortaround the usage. These concordances are fuzzy (i.e., not identical) and ofvarying size.
Vendors may sometimes investigate if these concordances orniches of product use represent a potential market. In other words, they arelooking for that next ‘hit’ product that will sell profitably. What are missed in many cases are the smaller non-hit niches.In other words, there is a correlation to long-tail idea.
Vendors do want to capitalize on these opportunities but thediscovery and development of such opportunities can be difficult. Thetraditional business-case approach very quickly: make a hypothesis on apotential product, conduct research on market potential, shape the product,more research, more development, then marketing, launch, support, etc.
The niche products are often eliminated in the market researchstage usually because it is difficult to find proper subjects to interview andconduct the research with.
Changing business-case development
There is another way about this that can work forestablished or existing companies but it is yet to be tested enough to becalled a process.
Assume you have a base of users (a great many exisingcompanies) that have deployed or are interested in deploying your softwaretool.
- Create an online community that allows all of them to get involved, and that allow the three forces described earlier to play.
- You allow the members to self-select or self-segment themselves into subsets that focus on different subtopics, uses or niches of your product.
- You try to successfully lead the community, and the many subcommunities to grow into an active participative system with many members.
- Some of those subcommunities will be focused on existing or covered product markets, while others represent potential new uses or niches.
- In addition to supporting existing products, examine the niche markets more closely and try to develop your business case from there. The case may not actually be a new product, but perhaps more documentation on the specific use, more specific assistance for those customers, etc., in other words, other possible revenue generating mechanisms.
- If you develop a new product or variation for that niche, you now also already have an identified population of potential customers as well as influencers who might help others accept the product.
The approach here is the opposite or bottom-up approach to definingmarkets that self-emerges from healthy active communities, rather than thetraditional top-down (the vendor trying to come up with new ideas). More so, itallows the potential for directly involving customers and users into theproduct-development lifecycle.
The role of online communities here is crucial. This meansnot just the passive approach of “let’s deploy something and leave it outthere”, but actually building relationships with the customers in thesecommunities, finding the influencers within, and trying to encourage healthygrowth. On other words, you need an active program to develop your community.
The dropping costs of “creating” such niches (moreaccurately: encouraging them to develop) through online mechanisms, means thatit is possible to explore many niches simultaneously, if you have a goodmeasurable system. Those with most potential automatically elevate to thehigher rankings, larger groups, and most activity.
I may be reaching here but it is almost like what quantumcomputing promises: calculate all the variations of an equation simultaneouslyto determine the correct—potentially multiple—result based on the highestprobability. (It might only truly apply if you have a really huge number of usersand a really huge number of products).