Hi everyone, you’re at the chatty curator channel and welcome to a special stand-alone series where I and my friend Lucas are having in-depth discussions about how Australian small medium-sized enterprises can succeed with being innovative and proactive in the 20s.

Hi, Lucas how are you today?
I’m good. good afternoon, good for our second chat, this is exciting to start this series

(Previously) “..If you think about how values created so after R&D (Research and Development) then you go in and you’ve got your relationships with suppliers your materials right before production and then you go you understand the customer marketing segment all the way out to sales after service
so what’s happening is the government says well let’s just throw everything into new product development…

To start, I’ll just quickly go into the reason that we want to do this video –
if we look at the news these days or the economy these days that we’re all trying to be innovative but what’s the actual word “innovative” means to all of us is a little bit different and so today we are going to talk about some of the ways that the capability impactors that can actually influence how we run our businesses and then we can go into different stories and information.

On the screen now you will see a really lovely 12 piece wheel of impactors that Lucas has put together. Lucas, do you mind doing a little introduction for us?
yeah sure, I think you made a really good point before we all have different understandings/definition of innovation so we might just start there
A really simple definition before looking at these impactors so for innovation to occur you need two things – there’s two sides of the equation
‣ you need to have an invention or new knowledge and
‣ you need an implementation of that invention

so coming up with a great idea is obviously not enough to commercialize and create value, so we say innovation is equal to invention plus implementation; and we know that Australia is really good at coming up with inventions there’s a gluttony of ideas out there, but we really struggle on the implementation-commercialization side.
So the fact is you can see on your screen there we derived from research on highly successful SMEs, and what they did after that invention stage in order to succeed with innovation.

Just like what we chatted about in our previous video, we are all looking way too much at the summit of the mountain, and forget that there’s the way that from R&D all the way towards delivering to the customer.
yeah! you’re exactly right. And I think that’s where a lot of what we’re going to be talking to SMEs is about, is that you don’t need to reinvent the wheel in order to innovate. And what we have now is a way to succeed with innovation, with the steps that occur after you’ve discovered your new knowledge and they’re very practical and pragmatic. That’s where we look and we look to start firstly with your customer base

When we say enhancing innovation it’s the neglected area. Everybody talks about transformation and of course change comes with the big risk – we know we have to change but we want to look to enhance before we transform, so we leverage what we already know and we’re looking at customer segments
so the first step in enhancing the customer segment would be looking at your product-market fit within the current and prospective customer base.
After that, you’d be looking to further entrench retain and grow through those relationships you’ve already got.
Alternatively, if we want to transform we will be assessing the potential of new markets looking into our market footprint, branching out into a new market so there we look to identify, assess, evaluate and select the markets that we want to pursue.

Well, one of the things I would love to talk about in this episode is – what the customer segment is? If we do a very quick google it’s easy to find and there are so many different definitions, but I think for this conversation, let’s focus on – how well defined the market is and then just you know focusing on establishing the customer base and managed by your organisation and how you respond to customer needs.
Leveraging what you’ve already got so if we’re talking about leveraging customer segment we’re talking about – how can we deepen the relationships we already have with our current and prospective customer base.

So let’s look at this from an enhancing point of view, we always ask our clients – have you established an understanding of your product and market fit with your current and potential customers?
good point, so people talk a lot about product-market fit. They talk about it as if it’s something magical where you find this fit and then the revenue flows in and it’s recurring – but that’s very theoretical really the product-market fit is having a group of satisfied customers, that you can draw testimonials from or they’re referenceable within your current customer base, that you can repeatedly earn from them, but of course, it’s not something that once you set it up it just flows like a river…
Things can change so quickly – I think many of the small business (especially regional business) are just trying so many things.
Throwing everything at the wall and see what sticks but, by doing that – they might actually exhaust their resources before they find the right fit and it can be very dangerous.
that’s exactly right yeah before you want to go and talk about risky things, like stepping out into new markets, it’s understanding how your customer needs are changing – now particularly with the pandemic, the customer needs have changed. They need maybe additional support features or after-sales service, things that fit around that to make your proposition still sticky.

There are so many different types of business, obviously, some doing one-off things but many businesses would want to have an ongoing relationship, that they can grow this customer base from. It’s easier said than done.
One of my ideas of doing the #GetChatty about your local businesses series, is to help businesses to retain their existing customers while we’re in a lockdown; while they can’t be there in the shops with you at least they can actively like or share a video about you – have these businesses developed the right type of relationship?

And particularly with B2B relationships, they rely on tangible benefits it’s not so much of a – look I know you, I’m going to provide you with the contract… it doesn’t work like that. So customers make decisions or buyers make decisions that are very rational and then based on tangible benefits, i.e does your product save me time? does it make me money? does it make my employees more engaged? these sorts of things are the tangible benefits as opposed to features, that you need to continually show your customer you’re providing because it’s not the features they’re interested in
Something that you mentioned was very interesting. You mentioned the Spple product and then Microsoft coming up with other products, based on that competitor knowledge – you know um it’s not just about using the stats to do that you also need to look at the relationship with that you know um earlier this episode that we talked about: well when the smartphone came out all of those mp3 players were gone… it’s just the way it is.
The problem there is that the competitor, I think was Microsoft – So Microsoft sized the market based on a number of iPods that were being sold. So they thought that there was a market for, and doing their little calculation they’re like well we’re Microsoft if apple has 100 of the market, we take 10 per cent we’re going to be with worth this much – but there never was a market for iPods, people just wanted to listen to music remotely and be comfortable in doing so…

I think, and I would imagine that many content marketers would be would agree with me, what we do differently from most digital marketers is that – we look at the numbers, yes we do, we look at the stats but then at the same time, we also want to see that relationship and quality that we develop with our customers. And that quality understanding of our competitors to really – just let them know that how you can deal with it, because with that knowledge that’s how you would not be throwing everything on the wall and see what sticks.
yeah that’s exactly right. I’ve had some great conversations with you about how we know other digital marketers that talk about stacking up your features in comparison to the competitor. But we know that once you understand how to solve the pressing job the customer is trying to get done that’s what you articulate through your communications.
There you go! It is an art form in a way, because especially small to medium businesses, to keep that competitiveness that little bit of balancing the results in terms of the stats and the quality of the service or like, service or after service, development, distribution and such as… is very important to create that mix and that personality, that people would people resonate with otherwise that it would just be like anything else that people can easily google
that’s right you know…
If they’re selling a product (that something similar can be) easily found on amazon, wish, kogan or whatever, they can be priced out by bigger players in the field.
We’re not impressed by bells and whistles anymore, we just want to know how does this save us time money and make us you know our relationships better it’s those sort of tangible benefits that we’re after.
remember the other video – all of these features on the phone, do they make calls? Well there you go!

Lucas, earlier you talked about transforming, which is kind of like going somewhere new/adjacent or similar to your existing market and of course that have people been identified and or assessed or chosen the right market to give it a go?
So of course we gotta we’ve got to look to get our product-market fit and deepen the relationships but then we also need to look to new markets and we need to assess the potential of new markets and one of the untapped factors really is – how that a product or service can apply in a sideline industry?
Now if you look at the growth centers, that are set up to support these important sectors. They operate individually in silos: so you’ve got food and agribusiness, you’ve got advanced manufacturing and you’ve got the med tech. The problem is some of these small-medium businesses, they’ve got products that apply across industries because industries really the concept of whether industries actually exist or not is kind of irrelevant – it’s really the group of buyers whose problem you’re going to solve where does your product have an application. So assessing the potential of new markets is a really exciting opportunity, and for example, one company I worked with, was making recyclable building panels for houses. And then they realized: well well these panels applied to roadside barriers, so taking that material or whatever the product is breaking it up and realizing how does it apply into a different market? and that’s where you have great success.

That’s very interesting. I have a parallel story that, back in new south wales. I was working with this golf course and they want to maintain that .location; and in the same location that they’re also setting up a place for day spa, massage facial and etc, the intention is a little bit like, maybe for a couple, one is playing golf the other one’s having a facial.
What was really interesting and I was saying to them: “you don’t actually need to have a brand new separate marketing campaign, say, Facebook or Instagram ad, there’s “interest search”, for example, on a Facebook ad that there’s “lookalike audience” – if you have the people in the region that usually would (consume the good/service) go for the golf, then based on their location there’s a similar audience that they can try that first, before doing a brand new campaign to attract the different audience – develop based on what you got, and even though it sounds like very far away, that’s actually a lot easier to promote to your new market.

yeah exactly and that’s the way it usually happens. Usually, the company gains what’s called a foothold, again we make the analogy of the footprint, so you gain a foothold in a market, and then that market that you’ve got gives you recommendations or ideas in order to grow into an adjacent market – that’s the way companies scale-up market. Often they start in the less profitable market segment before they refine their product and their offering and then they can enter into the more profitable market segment and fight against the big boys, the big players.
We always need to look into how we evaluate a new market, like what is an effective approach to a new market. You touch on that a little bit already – there will be established players there, will be people already occupying that space, so:
‣Is the market growing? because you want to look at how attractive it is in terms of margins.
‣What are the sort of margins you can make on your offering?
‣ Is it growing?
‣ How consolidated or fragmented is it? (meaning, are there just a few big players that own all of the markets? or is it like coffee shops where we’re all little players that make up the market?)
Those sort of things gives you an idea of how attractive the market is to enter.
Maybe there are different ways that you can help their customers to get things done better or cheaper?
Yes, absolutely
That’s how you got that’s how you develop the edge.
That’s right and people overcomplicate. simply does your offering help the customer get the job done better or cheaper or both? and that’s it that’s the strategy
Would be that’s great if it is both!

Sometimes you don’t need a really fancy thing to do market research, you can always start with, for example, finding out what the keywords are, what the search terms are. Because everyone going on their phone and just type “cafe”, “coffee near me” or something like that.
Find out and many existing like, Google Trend or SEMRush and etc.

Ultimately, we don’t know what we don’t know, and sometimes it’s the best practice to see which approach may be better for you. It can be enhancing or transforming, or a combination. It’s really depending on you, either work what you got or find something similar to make it work for you.

To the audience. Thank you so much for your time, spending time with Lucas and myself talking about the SME customer segments.

I hope you find something useful from this series and I look forward to seeing you next time.
If you like what you’re watching, why not check out another video? For example #GetChatty about your local business video that i did with Lucas a couple months ago!
thank you everyone, have a good day
thank you see you later