Launching a new product or taking an existing product to a new market is a leap of faith. By definition, the company has little experience in trying to sell the product to its target customer so while the idea may be based on sound judgment, you don’t know for sure that the dogs will eat the dog food. Given the percent of start ups that fail, it is safe to say that often, they do not. However, it isn’t that the successful ones come out with the right food for the right dogs the first time. It is that they are quick to adjust if they haven’t.
To that end, we’ve developed a 20 hour test that can tell whether or not you have it right. Therefore, if you start at 9:00 Monday by lunch on Wednesday you will have your answer.
The 20 hour test comes from applying our Market Immersion methodology to dozens of new market projects. In a nutshell, Market Immersion is a methodology for beta testing sales. It enables companies to rapidly build real world selling experience so they can figure out what works, what doesn’t and adjust accordingly.
The first step in process is for the company to cold call prospects to set up beta test sales meetings. Cold calling is admittedly an unpleasant task, but here are the cold hard facts about cold calling. If it takes you more than 20 hours to cold call a qualified beta test sales meeting, something is very wrong.
Here’s why: When you cold call, you are reaching out to people who you believe should need what you have to offer. If it takes you more than 20 hours of calling to convince just one qualified prospect that it is worth 60 to 90 minutes of their time to learn more, then what you are saying is just not that compelling – there is just not enough pain around the problem you are proposing to solve or value you are proposing to bring to build a business.
For people who say, “Well maybe the problem isn’t the technology, it is that people just doesn’t understand it or are not ready for it.” To that, I respond, “Precisely.” Failing the 20 hour test is not a death sentence. It simply means that you need to go back and retool – different target, different message, different features, different business model. On the other side, passing the 20 hour test doesn’t mean that you have it nailed. But it does mean that you are at least playing in a market where there is real pain.
I’ll add one more caveat – the 20 hour rule only holds if you run a good test. Here are some of the basics.
· Position the meetings as discovery meetings with the explicit understanding that if they are interested, it will move into a sales cycle. We typically say the following, “We are launching a new product in your market that does X. The reason for our call is that we want to make sure we get it right and to that end, are interested in getting your feedback.”
· A qualified meeting is a meeting at a company that is a legitimate prospect with a Vice President or someone who reports directly to a Vice President. Lower level people are more willing to meet and are not a reliable gauge of interest.
· You can’t delegate the cold calling. The key to setting up the meeting with mid and high level individuals is having an expert on the phone with them
· You have to doggedly dial the phone for 20 hours – Practice your skill at sweet talking administrative assistants, begging for email addresses and following up relentlessly.