Product positioning · Marketing Strategy

How to gain market traction with a B2B and B2C target audience?

Richard Pridham Investor, President & CEO at Retina Labs

November 24th, 2015

I am helping a local start-up get off the ground and am considering an angel investment if I can be convinced there's a real opportunity here. The company offers a cloud-based workforce management and scheduling platform that can be used by any business that needs to manage and optimize employee schedules and shifts. They have no customers yet, only a core product that's a bit passed the MVP stage.


Although they have built a really decent product, they're not sure how to position themselves yet (they are engineering types). I know that the workforce management space is filled with many vendors including big ones like Kronos and I believe ADP. This start-up has built in some really nice features that allow consumers to book appointments with care and service providers (basically any business that takes appointments from customers or patients). I believe that the combination of workforce management and customer booking features offer the company some flexibility in terms of positioning. Rather than positioning itself as a workforce management solution and go head-to-head against a myriad of competitors, I'm thinking that they can position themselves as a complete customer engagement platform for service and personal care providers (hair salons, doctors' offices, spas, auto service centres...). Essentially, a platform that consumers would use to search and discover providers in their area, view services & rates, book appointments, pay, rate and recommend, etc... For the service provider, they would use the system to manage their entire business: workforce schedules & shifts (across all its locations), publish schedules/accept appointments, send reminders, billing/POS, offer coupon incentives & promotions, manage its customer database, etc... For the service provider, it could be used as a customer acquisition/retention tool and a means to enhance the customer experience. It's amazing to me how many of these salons still use a paper agenda, manual cash register and force customers to call in for appointments. I know companies like StyleSeat.com offer something like what I'm describing.


If this were the path the company decided to pursue, it would mean garnering user adoption with two key audiences: 1) service provider businesses and 2) consumers. For businesses, they'd pay a subscription fee of some sort and for consumers, it would be free of course. I have not yet researched the market, but my guess is that there are tens of thousands of provider companies in the market from single location operations to large chains like SuperCuts. The small independents make up most of the market and would be the focus as I think many of the big chains already have systems in place.


So my question is how to go about gaining initial traction with something like this? What do you focus on first? I'm assuming that you need to get provides on board first for the whole platform to work. How do you reach them? There are so many out there and most are small mom and pop operations.What marketing techniques work best (paid search, direct mail, telesales)? Since the platform is not yet fully developed with all the bells and whistles, how do you attract the "early adopters"? Give it to them for free for a period of time?


What are the best ways to best ways to gain adoption on the consumer side? My thinking is to have the service providers themselves promote the product by getting their customers to signup and start using the platform. But beyond that, what's the best approach to build the community?

James D.

November 24th, 2015

Hi Richard,

Part of our startup has a SaaS component that requires us to deal with small retailers who are behind the times and still using antiquated methods.

Our partner found it difficult to change their mindset, so they went after a more sophisticated customer who knew the value of what they were offering, and it has grown their business to manage over $6 billion annually in transactions.

As far as your prospects business model, it sounds like a lot of moving parts.

One thing you don't want is a Swiss army knife product with features the customer will never use. I would have them focus on the core pain point of their customer and maintain a narrow focus to prefect that core solution and differentiate themselves from the competition.

 Have them get outside the building and get feedback from customer's so you don't build what nobody wants. Once they have proven traction with this new focus it will give yopu a better grasp of their potential.

 Good luck to you guys!

Marc Milgrom Business Manager at Bloomberg, LP

November 24th, 2015

Even the position you're looking at is hardly blue ocean. There's http://www.salonbizsoftware.com/ doing exactly what you're describing, and Square, Level, Stripe, et. al. handle payments for many small salons I've seen if they take credit cards. (Many prefer to remain cash-only for the same reasons many small businesses do.)
I personally think your best bet is to drive adoption is by partnering with web designers/developers who service the small business verticals. Consumer adoption is going to come naturally from their salons, studios, etc. using it for engagement. If you want to make the app be a clearinghouse for consumers to find new service providers, I think that's a tougher ask, not least because I think most consumers are loyal and follow their stylist or service provider moreso than the business itself. Overall, I think this is a hard hill to climb. It's very similar to what Groupon and LivingSocial did to recruit vendors for deals, hiring massive local sales forces in every city, and we know how that has worked out.

Andrew Lockley

November 25th, 2015

Free trials are a terrible strategy. Build buy in with a genuinely compelling free offer, then constantly nag for revenue with upgrades to features and capacity. Andrewlockley.com

Jake Carlson Software Development Manager at Oracle

November 24th, 2015

Laurelle Johnson, MBA

November 24th, 2015

My suggestion is to start by creating a business plan. Not one that is 80 pages, but one that covers the basics: target market, competition, marketing and sales strategy, budget, cost of services and revenue projections.  Any start up needs to research which type of service businesses will gravitate to what is being offered easily, and which will not. Knowing the "barriers to entry"  in reaching and FROM the mom and pop stores will help the business build a cost-effective reach-the-client strategy.

The smaller service providers have very slim margins and adding an 'automation' cost may seem they will lose the personal touch with their clients.  Some businesses, such as beauty salons, offer a high level of personal touch, as they are working on a persons looks, which demands a high personal touch. Day spa's use 'personal touch' as a competitive advantage.  So know the automation resistance can be high.


Hope this is of help to you.  

Manmit CMRP Drive organizations forward through analytics, decision analysis, and human learning

November 24th, 2015

I second Marc's assessment. The current proposition is not very strong. It would be a stronger game if you can add predictive analytics component.

Annette Tonti Founder, President at The Start Exchange

November 24th, 2015

Check out Booker.com  and Agendize.com    Both known to the Local Business  Market for years.  By local we mean both the National Local chains as well as the hyper local 'mom and pop'.  This is a channel play that may include a direct offering as well.

Paul Murskov

November 24th, 2015

Hi Richard,

I agree with the previous posts. Wanted to provide an understanding of the competitive landscape:

www.thumbtack.com is a massive player in the space that drive leads and customers through a vast SEM, SEO and email campaigns and drive customers as they search on google for these services. 

There are also a TON of big players that focus on niche segments like cleaning (www.handy.com) or spa's (www.spafinder.com). 

Booking platforms like www.booker.com have also created a lot of traction in the booking space. 

Revel and ShopKeep handle brick and mortar POS for smb's both with a massive salesforce. 

Belly and Flok are mobile coupon and remarketing platforms that are meant to drive repeat business.

Yodle and Signpost offer marketing solutions for smbs that create a level of automation that drive leads through email and search.

It's just a very, very congested space. From my previous experience dealing directly with a lot of these types of smb's, their main challenges have always been 1. lead generation/repeat business and 2. client management and scheduling although most smb's are reluctant to invest in any kind of scheduling or management system if there is not a lead/customer generation component associated with that solution. 

To answer your question about getting initial traction with an MVP: My recommendation would be to start with a small BD campaign to start reaching out to some of these companies, offer the platform for free and eliminate the fluff to offer 2-3 core value props that this platform offer if they were to sign up and use it. I would also want to identify my ICP (ideal customer profile). Are you targeting brick and mortar or are you targeting the on the go smbs like plumbers, cleaning companies, contractors, etc. People that are on the go need a different solution than people who sit an office all day although they can all be bundled up under that type of profile. Once you have that baseline you can either bring on a sales contracting firm or hire a salesperson (maybe even part time) to start reaching out to prospective clients and prove that this platform is actually something that your ICP's need rather than building a product or investing in building a product that will ultimately fail (not because it's not a great platform but maybe because the solution does not really align with the needs of today's smb owners).

Hope that helps!
Paul

Richard Pridham Investor, President & CEO at Retina Labs

November 24th, 2015

I agree with Marc that this is hardly blue ocean territory. I'm just wondering what can be done around their core scheduling capability, which, in and of itself may not offer a solid value prop. While I haven't reached any conclusions yet, my thinking is to build a feature set that not only handles schedules but makes it easier for consumers to discover and book appointments with service providers. I'm certainly aware that there are many players in the space that offer different pieces to the puzzle when it comes to acquisition & retention. I wasn't thinking of plumbers and house cleaners necessarily but more brick and mortar business offering personal care and services that require appointments. It appears that there the space is congested. I will look into this some more. My personal experience with many of these businesses is that they are still in the dark ages and relatively unsophisticated when it comes to adopting technology to drive their business.

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November 24th, 2015

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You must know this is a market with repeat business,but to start with you should know which services have highest chance of being repeated.

Regards,
Kamallendu Singh