The COVID-19 epidemic has the world on high alert with travel restrictions, quarantine measures, deaths, and reports of crippling losses and shutdowns across practically all business sectors, destabilised by the disruption in the global supply chain and general mobility of human capital.
As the implications hit home, I would like to connect the characteristic that makes viruses so potent from a healthcare perspective to its ‘positives’ when looked at from the business lens.
The trend with most start-ups rolling out a new product is to adopt a beachhead strategy where the focus is on a small segment of an identified market that once owned, provides the revenue and experience base from which to expand by claiming more market share or going for a larger more lucrative segment upstream, downstream or integrated.
The challenge to any beachhead strategy is that businesses do not operate in isolation and are plagued by a plethora of issues.
In the past, through this column, we have explored the fact that inferior products can deliver better revenue contribution to the bottom-line than more refined and even better-funded counterparts in what is a case of better distribution.
Riding on solid unit economics, getting to scale should be the key objective for any business. In social media, we often hear that a piece of content went viral, amassing some highly coveted metric such as likes, views or downloads over a short period.
Product teams need to look at how to place, enable and encourage uptake of their services beyond any initial marketing effort. A virus — your product is inert outside of a host — a customer. But once inside a host, a virus puts to good use the ‘infrastructure’ at its disposal to rapidly replicate.
In the case of a product, this means quickly building up utility, form a habit, incentivise usage and increase the propensity to share with others, tapping into network effects.
A viral coefficient of more than 1, with the shortest possible cycle from product introduction to a recommendation, is the desired position. This means that each one, infects one, two or more, who in turn perpetuate it achieving that much coveted hockey stick growth curve that is the delight of any business executive.
Consumer hooks are not always in plain sight and it takes analysing the behaviour of your target host more intently to confirm their triggers and bake them into the product.