Archive for February 7th, 2017

<p>As the U.S. labor force crests again, a new complex of problems locks many Americans out of the workplace.</p>

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A border-adjusted tax—the linchpin of the House Republicans’ tax overhaul plan—is splitting the business world into competing camps. Opposing it are retailers, car dealers, toy manufacturers, oil refiners and others that say it would drive up import costs and force them to raise prices.

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Rising mortgage rates, bigger jumps in home prices and still-moderate income growth are adding up to a triple threat for the housing market.

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Competitors benefit, but it's not as simple a formula as you may think.

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Swelling inventories, rising incentives and a flat U.S. auto market usually suggest General Motors Co. will be preparing investors for a tough year. Instead, the biggest U.S. automaker posted record annual profits on Tuesday and sees more growth on the horizon.

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Rising mortgage rates, bigger jumps in home prices and still-moderate income growth are adding up to a triple threat for the housing market.

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<p>Stocks rose Tuesday as investors focused on a slew of corporate earnings reports.</p><p></p>

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<p>U.S. equities rose on Tuesday as investors focused on a slew of corporate earnings reports.</p>

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<p>U.S. equities opened higher on Tuesday as investors focused on a slew of corporate earnings reports.</p>

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Seth Klarman is not a household name, but his letter to investors, warning about the new administration, is the most sought-after read on Wall Street.

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This chart, from First Round Capital’s recent post Leslie’s Compass: A Framework for Go-To-Market Strategy is super interesting. It’s first use is for founders to work out whether they should have a sales intensive or marketing intensive go-to-market strategy. That’s the point of the post and the summary is that if your business has the characteristics on the left hand side then your strategy should be marketing intensive and if you’re more like the right hand side you should be sales intensive. If you’re thinking this problem through at all I would highly recommend reading the whole post.

The second use, which they don’t cover, is assessing whether a business idea is likely to be successful. It’s an obvious thing to say, but unless a business can find a successful go-to-market strategy, sales will be limited and it won’t succeed. The power of this framework is that it can expose fundamental challenges to the viability of a plan even when it is only a concept, and then it can suggest ways to address those challenges.

Simple plans are easiest to execute and in this case the simple plans are ones that are either marketing intensive, or sales intensive. Plans that sit somewhere in the middle are ok, but products that have some marketing intensive characteristics and some sales intensive characteristics have an inherent contradiction that if left un-addressed will undermine success.

The most common and obvious contradiction that we see is complicated and high touch products that are inexpensive (or have low margins). Even if the product is a bullseye hit with what the customer needs, it won’t be possible to persuade them of that fact without an expensive sales effort, which won’t be covered by the value of the sale.

Other contradictions to watch out for include B2C : complex products and many customers : low fit, but the most important one is definitely cheap products that require a sales lead approach.

Business plans with contradictions like this aren’t necessarily fatally flawed, they are just more difficult to execute, and that brings us to the third and final use of this framework, which is to inform product strategy. If there is a contradiction then one solution is to resolve it through product innovation – if the contradiction is between low price and complexity/high touch then either find a way to either to take the complexity out or to charge more.

Usually those product innovations will be to enable a more marketing led approach, and to generalise, companies that move product categories from being more sales intensive to being more marketing intensive make promising bets. The shifts don’t have to be big either – convenience is a winning proposition. Examples are legion, but Slack is a great one. Last May they became the fastest company to reach a $2bn valuation in large part because they succeeded in making a product that works with a go-to-market strategy that is close to 100% marketing led. Looked at through this lens, their genius was in taking all the complexity out and enabling low touch adoption.



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In recent days some major voices are sounding caution that the Trump Trade may be coming to an end.

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The base price of the most commonly used brand-name drugs rose on average by nearly 11 percent in 2016

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China has already surpassed the US as the most powerful economy in world

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China has already surpassed the US as the most powerful economy in world

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