May 10, 2010When I was a college student, I took a humanities class taught by a brilliant professor named Sam Toperoff. He used to say the most amazing things—"The only way to judge a person's intelligence is by how well they live," for instance—and I used to look around at my classmates, some of whom were asleep, and think: Are you listening to this guy?
I had the same feeling during the recent Geoffrey Moore webinar that we hosted with the support of RFID Recruiters. Moore is clearly the world's foremost authority on the technology adoption life cycle and how to effectively exploit market opportunities at each stage. His books Crossing the Chasm, Inside the Tornado, The Gorilla Game and Living on the Fault Line are all bestsellers, and are considered required reading at many leading business schools.
Moore addressed many of the issues RFID technology providers—and users—are facing as the technology goes through the adoption life cycle. Approximately 750 people signed up, and about half of those individuals logged on to the live event. Those numbers are high for a webinar, but given Moore's stature, and the struggles the RFID industry has faced, I had thought we'd reach our limit of 1,000 people, which we didn't.
The irony is that many of the companies that I think are doing a good job of positioning their products and solutions in the market for when RFID enters the tornado were on the call. And conversely, many of the firms that are doing a poor job were not. I would encourage those who missed the event to view the archived video of the webinar in our video library.
For those of you who think you're too busy to hear what the master has to say, here is the Cliff Notes version. (For those unfamiliar with the term, Cliff Notes are summaries of books and topics designed to make studying quicker and easier—short cuts for students.)
• RFID probably has crossed the chasm, at least in some industries, such as health care. In others, the business case is still being proven, and it is still in the chasm. (The chasm is the stage between "visionaries" who adopt technology solutions to try to gain a competitive edge, and "pragmatists" who will invest in a technology only when everyone else does so.)
• The right strategy for RFID solutions providers, at this stage of the market, is to focus on a specific vertical industry with a compelling problem that RFID solves, and to build a product that can solve that problem and can be deployed in a repeatable manner. Then, they should look for people within that industry that have that particular problem.
• Solutions should be oriented vertically rather than horizontally, because while the problems RFID solves are common across many industries—lost or misplaced assets, for example—the balance-sheet issues can be very different. So companies buy vertical solutions at the "bowling alley" stage—when a "whole product" meets the needs of a market segment—and horizontal solutions during the "tornado" (period of rapid growth) phase.
• As technology providers develop their industry-specific solutions, they need to get close to existing customers to understand their needs. They should attend vertical industry events to understand the issues people in that industry are discussing.
• Marketing should be focused on the industry-specific issues companies face, rather than around the superiority of a solution provider's technology. "Eighty-percent of the messaging is you describing the problem, why existing technologies have not been able to solve them, and why this new technology called RFID should be able to solve them," Moore said. "Then, the last 20 percent of your messaging is 'Here's how we would go about it.' If you express an understanding of the problem, it resonates with businesspeople."
• Don't focus on the technology, but also don't avoid the term RFID. "I think it's a mistake to abandon the category name once it has become known, just because the category has fallen into disrepute," he said. "It is easier on everyone if you rehabilitate the category, because, frankly, having the name being known is a much harder problem to solve than having the name being respected."
• Don't attack your competitor's technology. "If you are in the middle of a tornado land grab, then knocking your competitor works," he stated. "Prior to the tornado, it slows adoption for everyone, and everyone loses. A much better tactic, prior to the tornado, whether it is early market or bowling alley, is to say 'This is a rich and wonderful technology with lots of great applications.' You pick an application where your competitor is good, and that you don't want to go after, and you say, 'Those guys are great for that application, but we're great at this application.' The message you are sending is, 'If you get out of my way, I'll get out of your way.'"
• Concentrate on winning additional customers in a specific market segment. Each new customer gets a solution provider closer to creating a "local tornado"—that is, rapid adoption within that industry. Owning an industry can be very lucrative, because customers are very loyal. (Moore suggested thinking about the loyalty to Apple Macintosh computers in the publishing industry.)
• Once you have achieved a tornado in one industry, tweak your product to solve a major problem for a closely related industry and start the process over again, building up a customer base until you can achieve another local tornado.
• When there are several tornados, the broader market enters the tornado. At that stage, companies need to switch from vertical industry solutions to horizontal solutions.
Several people who were on the call e-mailed me to thank me for hiring Moore to host this webinar. One person wrote, "That was the best hour I've spent in a long time. I wish I had read Moore's books 10 years ago."
I have to thank RFID Recruiters for sponsoring the webinar. Mike Shiff proposed the idea, helped get Geoffrey Moore to do it and put up the funds to make it happen. So I think the entire industry—even those who didn't log on—owe Mike a debt of gratitude.
Mark Roberti is the founder and editor of RFID Journal. If you would like to comment on this article, click on the link below. To read more of Mark's opinions, visit the RFID Journal Blog, RFID Connect or the Editor's Note archive.