They’re not your customers anyway

That bastard cracked your $1 app. ONE DOLLAR. That’s all you asked in exchange for the hours you put in, and the guy still didn’t pay. People like that should be executed. Like in the middle ages – an arm for an arm, an eye for an eye. Chill. He wasn’t your customer anyway.

Without diving too deep into a discussion on the usefulness of copyright, there are lessons we can learn from the fashion industry. It always had next to no intellectual property protection and a gigantic knock-off market (ever seen street stands with “genuine” Louis Vuitton bags?) Looking at how much sales the fashion industry is making, compared to high IP ones, they seem to be doing just fine:

Sales in high- versus low-IP protection industries

Still, fashion designers must be feeling awful watching people buying all this counterfeit apparel, enjoying the results of their work without payment, and will pursue every opportunity to curb that market, right? Not quite. Addressing the issue, Gucci’s legend Tom Ford said:

And we found after much research that — actually not much research, quite simple research — that the counterfeit customer was not our customer. [emphasis mine]

Tom Ford, Ready to Share: The Ecology of Creativity in Fashion

I picked up the quote from Johanna Blakley’s talk at TEDxUSCLesson’s from fashion’s free culture“, where she argues for less intellectual property protection overall, which would not only spark innovation by making new ideas easily accessible, but also profit the very creators who’s interests copyright claims to protect.

You see, the guy who cracked your app wouldn’t have bought it otherwise. Maybe he doesn’t have the money, maybe he’s not sure if it’s worth even $1, or it’s just his philosophy – not paying for software. But the app now has one more user, who still might become a customer eventually, or lead others to become by bragging about the great app he just found.

Think beyond the app, where you already sunk the cost of development. What can you offer that is scarce, that would make paying more attractive? How about a service available only to official customers? Support? A booklet with workflow tips?

Focus on your customers – those who do pay, because they value how your work saved them some of theirs. Build relationships with them, see that the app continues to adapt to meet their needs, and don’t waste emotions on those who never were your customers in the first place.

I don’t want to be in a startup

Being in a startup means going to startup events to meet other startups and talk about startups. You may think of a “startup” as two guys working feverishly in a garage and suddenly dropping the bomb of a revolutionary new product onto the unsuspecting world. But what I saw is best summarized by a friend’s comment: “have you actually seen them ship anything?

Business is about earning money, and you do that by delivering something of value to a customer. A “customer” is, by definition of a befriended accountant, “someone who paid.” Startups, in order to be legitimate businesses, also need someone to pay and they indeed find such people. They’re called venture capitalists.

Now, before you start sending me examples of startups actually delivering something and getting paid for it, I assure you I’ve seen them. I just wouldn’t call them startups. You won’t meet their founders on most startup events. You can meet them at work, when they’re not meeting their customers, or spend quality time with their cherished families. They’re just plain, old businesses.

If you don’t appear, you disappear

Who are you? How do you expect me to trust you? I know you do, because you’re trying to sell me something. You’re a startup; you put together a cool tool, working with your friends in a garage. You’re ready to hit the market. No-one knows you.

When you don’t have past achievements to speak for you, then all you have is transparency. Blog, tweet, share. Write about your ups and downs, explain your philosophy, speak of what you learn while working. It’s not likely to get you a seven-figure order, but it will build trust among your prospective customers and at some point some exec with a budget surplus will say “o hell, let’s check these guys out.”

Are you listening?

I killed a salesman last week. He called from my cell phone company, he offered me a contract renewal, he kept using 10 words wherever 1 would suffice and kept pushing me to close the deal now, today, immediately. “I don’t understand; you already said you’re taking the offer!” Did I? He earned some well deserved frustration, hang up mumbling something about a time-waste.

“I’ve a better deal for you than you’ll get at our stores” said another salesman calling from the same firm today. I said “I’m listening.” 5 minutes later we closed the deal, the salesman congratulated, thanked me and left to cash in his commission. No pressure, clean, accurate facts, knew what he was selling. When I spoke, he listened. When I was thinking his proposal over, he stayed silent.

Too bad I’ve no way of contacting him in person. I’ve more contracts coming up for renewal.

Are you listening?

Outsourcing sales is bad for business

If a development team is the heart of an IT firm, then the sales team is its face. The eyes that scan markets, the mouth that speaks about products, ears that listen to customers and the nose that sniffs for opportunities and problems. There are successful companies with great sales and lousy technology, while marvellous technologies with bad salesmen perish quickly. Why would you want to operate your business without a face?

The first thing you’ll find out when trying to work in sales is that it’s hard. It requires constantly exposing yourself to rejection, ignorance, abuse and a lot of pressure. You get targets, which are strictly bound to your salary and therefore living standard, if not survival. Then if one-on-one meetings with customers weren’t bad enough, you have salesmen from other companies competing for the same dollars you’re trying to collect. Why not help yourself? Let another entity do the sales for you:

  • they’re more experienced. They’re focused on just sales and nothing else.
  • they’re working on commission. No sale, no pay. Much cheaper than running that in-house.
  • they’ve more prospects. Tap into their existing client base without the pain of building one yourself.

Pretty nice, isn’t it? With sales out of the way all you have to deal with is working to improve your products.

Truth is you’re not making the products for the fun of making products. Well alright, you do, but only after you deliver them to someone who’ll value them more than the money they’ll give you in exchange. Since you’re making products for others, you probably want to be in touch with them often, so that you get plenty of feedback.

  • is this what you wanted, sir?
  • does it work as you expected, madame?
  • how can we improve it to better serve you?

Now, who knows your product best? Who cares the most about your product? Certainly not the commission-based salesmen. They’ll know what you’ll tell them, which is a small subset of what’s available. They’ll have products from different vendors, so if yours doesn’t fit, they’ll choose another. No feedback, no chance for you to adjust, improve and deliver. You cut yourself away from the very source that feeds you, both with new ideas and with cash to keep running: your customers. Think well before you choose that path.