The biggest single barrier to the development of an effective strategy is the strongly held belief that a company has to appeal to the entire market.
– Al Ries
A few years ago, I worked for a start-up that was headed up by an uber-geek. He lived, ate, and breathed technology. While this was great for the product, it caused some problems for us when it came to getting our message out.
The problem was that our CEO liked to think of himself as an Everyman –- as just like everyone else
-– when in truth he was very different than most people.
This misconception came to a head one day when we were discussing the presentation he was to give to an audience of potential investors. I was happy with the presentation because it had worked several times before with angel investors, but the CEO wasn’t. He wanted to change what we were saying and how we said it and go back to a lower level, more technical message that I knew didn’t work with Ordinary People. I asked him why he wanted to make those changes, and he replied with something that has stuck with me ever since.
“It just doesn’t work for me.”
I have to admit to having a George Costanza, “Jerk Store” moment. Rather than coming back with a great line, I just sat there stunned when what I should have said is this.
“It doesn’t matter.”
At the end of the day, it didn’t matter that the pitch didn’t work for him because he wasn’t the target audience. He was going to be giving the presentation to a non-technical audience.
What we needed was a message that would resonate with the audience, not the presenter.
DON’T JUDGE YOUR ELEVATOR PITCH
BY YOUR OWN STANDARDS
When helping people and companies with their elevator pitches, I frequently encounter this problem. Instead of judging their elevator pitch by the standards of the audience, people instead judge their elevator pitch by their own standards. As a result, they end up with a pitch that is at best ineffective and at worst makes them look cut off from the real world.
This happens because people fail to realize that they are different than the audience; they are more interested in, and more knowledgeable about, their Solution than are most people. As a result, they fail to understand that what is compelling to them probably isn’t compelling to others.
THE POWER OF FOCUS
The way to solve this problem is to first understand that messages are most powerful when they are focused; that the more focused a message is, the more powerfully it will resonate with the audience.
One reason why Procter & Gamble is such a large and powerful company is because they clearly understand this principle. Rather than trying to create one-size-fits-all products, they instead create different brands to solve different –- and specific
-– problems. In fact, in some cases Procter & Gamble will have multiple brands in the same category (e.g. Cheer and Tide), seemingly competing with each other. However, the truth is that, since those products are positioned differently, those products aren’t really competing against each other. Instead, they are appealing to different people with different problems.
General Motors used to understand this principle. When GM was in its heyday, it created a hierarchy of brands, each of which was designed to appeal to a different market. Chevrolet was the entry-level brand, Pontiac was the sporty brand, Cadillac was the high-end brand, and Buick and Oldsmobile were upper middle class brands. However, during the 80s GM largely abandoned this approach and tried to make every brand appeal to everyone. The result was that GM soon started to lose market share to Japanese companies who started to beat them with better quality but also, and just as importantly, used a hierarchical brand model (e.g. Honda/Acura and Toyota/Lexus/Scion).
WHAT EACH AUDIENCE WANTS TO HEAR
The same basic principle applies to creating an effective elevator pitch. One reason why elevator pitches often get long, and as a result less effective, is because people try to make them be everything to all people.
They try to appeal to everyone with a one-size-fits-all elevator pitch.
A far more effective strategy is to create (slightly) different versions of your elevator pitch, each of which is designed to appeal to a different audience. Each of those different versions should be generally similar but should stress slightly different things, especially when it comes to the close of the pitch.
The first version of your elevator pitch that you need to develop is the one that you will use to sell your Solution to potential members of your team.
Team-focused elevator pitches are often inspirational and commonly stress the team’s vision and their desire to change the world. Team-focused elevator pitches are also often lower-level –- in other words more HOW
-– than are later versions of one’s elevator pitch. This is because the target audience of a team-focused elevator pitch is generally people who already have some understanding of the technology and market.
That’s why you want them to join your team. This team-focused elevator pitch is usually the easiest one for entrepreneurs to write because it usually requires the least amount of thought on their part. In most cases, you are looking for people pretty much like you. As a result, you can judge the quality of your pitch by whether it appeals to you or not.
Of course, the thing that often trips people up is that the initial, team-focused version of their elevator pitch often works quite well when it comes to recruiting. However, at some point –- usually as people start trying to raise money –- it stops working. This is because investors will be interested in your Solution for different reasons than will potential members of your team.
Investors, Backers, and/or Sponsors
The second version of your elevator pitch that you need to develop is one that is targeted at potential investors. This can include venture capitalists, angel investors, executive sponsors, and other backers.
A good investor-focused elevator pitch is different from a team-focused elevator pitch in a number of ways. First, a good investor-focused elevator pitch deals less with the HOW of your Solution and more with the WHAT and WHY. This is because potential investors will want to understand the value that your Solution will deliver and why people will change and adopt it. Investors are also unlikely to have much experience with, or interest in, the HOW of your thing. Second, a good Investor-focused elevator pitch more directly addresses the risks that are involved in bringing your Solution to life. As a result, a good investor-focused elevator pitch pays more attention to the WHORU factors that establish your credibility. That includes your qualifications to see the problem and to build the solution.
When writing an investor-focused elevator pitch, you need to keep in mind that there are a number of different types of venture capitalists and angel investors, all of whom are looking for, and invest in, different things. As a result, you can keep from wasting people’s time –- and look more knowledgeable and thus credible in the process –- if you make several things clear in your pitch.
First, your pitch should make it clear what type of company you are; whether you are a service provider or a product company, a life sciences company or a technology start-up, and a hardware or software company. Second, your pitch should explain what stage you are in; whether you are an early-stage company that is looking for seed money or whether you are a going concern that needs help scaling your operations. Third, your pitch should explain how much money you need and what you need it for; whether you need it to finance the development of your product or for working capital.
In many cases, you cannot go to market by yourself. Instead, you have to recruit a team of people and companies who will help you. This can include Business Partners (BPs) like Value-Added Resellers (VARs), dealers, sales agents, and retailers.
When it comes to developing the BP-focused version of your elevator pitch, the thing to explain is why your product will be in demand; why it will sell. This is because, while business partners want you to be successful, first and foremost they are concerned with themselves.
This means that your BP-focused pitch should address the same credibility-based issues that you address in the investor-focused version of your elevator pitch. However, you also need to stress that you are a good group of people to work with. People do not want to partner with someone who will let them down. As a result, you need to stress your experience and your ability to do what you say you can do.
Press and Analysts
One of the cheapest, but most powerful, ways to build awareness about your Solution is to take advantage of the power of the press. Because of the press’s inherent credibility –- and the fact that what others say about you is always more powerful than what you say about yourself –- a single well-placed article can do more for you than hundreds of thousands, or even millions, of dollars spent on advertising.
There are several things to keep in mind when you are working with the press and analysts, and in particular the business press.
First, the press needs you; they are constantly having to find new content to fill up their newspapers, magazines, and blogs. However, at the same time the press is trying to serve their readers by providing them with high-quality news and information. As a result, the press and analysts are highly concerned with the credibility of the sources they rely on.
They need to feel confident that what they say or write about is the truth.
A second thing to keep in mind when it comes to the press and analysts is that they are always trying to get ahead of their competition. As a result, they are always interested in a new and different vision of the future.
However, that vision has to be backed up with significant credibility -– significant evidence as to why it’s true
-– before they will buy into it.
The last version of your elevator pitch that you need to develop is your Customer-focused pitch. Fortunately, this isn’t too hard to do because potential customers are concerned about the same basic things as potential investors. They want to understand the value and benefits your Solution will deliver and why you will be able to get the job done.
HOW THIS WORKED AT SALESLOGIX
While the SalesLogix pitch was generally consistent across the different audiences to which we delivered it, we would change the ending of the pitch and some of the things that we emphasized depending on to whom we were speaking.
SalesLogix Investor Pitch
The version of the SalesLogix elevator pitch that we delivered to potential investors focused almost exclusively on the credibility of the team. Rather than getting into too much detail about the problem, we instead explained that it was a problem with which we had been familiar for a number of years.
SalesLogix Business Partner Pitch
The version of the SalesLogix elevator pitch that we delivered to potential business partners focused on the specific problem of database synchronization, because we knew that was the Achilles Heel of every existing solution and the thing that was driving Value-Added Resellers (VARs) crazy. Everyone said that they had solved the problem of database synchronization, but the VARs knew from personal experience that they hadn’t. We knew there was no point in getting into too much detail about all the different features that our product provided if we didn’t first establish that we knew how to solve that biggest problem of them all. We also knew that if we could convince potential business partners that we had solved the problem of database synchronization, then they would regard all the other features of the product as gravy.
SalesLogix Press and Analyst Pitch
The version of the SalesLogix elevator pitch that we delivered to members of the press and analysts focused on several things. First and foremost, we focused on the credibility of the team, because that gave immediate weight to our observations about the market. What was a little different about this version of our elevator pitch was that we got a little more into what George Bush The Elder would call, “The Vision Thing.” We did this because we knew that analysts tend to be interested in the different vendors’ visions of where the market is going.
HOW THIS WORKED AT ROGUE RESEARCH
The Rogue Research elevator pitch also followed pretty much the same pattern as the SalesLogix elevator pitch. It was generally consistent but could be customized depending on which audience we were speaking to.
As we first started to go public with what we were doing, our primary needs were for additional team-members and technical business partners who could build solutions using the tool we had created. As a result, we created a summary sentence that was fairly HOW-focused...
Rogue Research is a software company and makes a software product, called Cloud Creator, that enables large numbers of commodity computers to form a mission critical computing environment called a Cloud.
While this version worked well when given to a technical audience that was already familiar with concepts like clustering and application servers, it didn’t work as well with less technical audiences like potential investors. That is because it didn’t explicitly point out the benefits of what we were doing. As a result, as the target audience of our elevator pitch changed, we also changed our summary sentence...
Rogue Research is a software company and makes a software product, called Cloud Creator, that enables businesses and other organizations to drive down the cost of mission critical computing.
This version of our summary sentence gave the audience enough sense of what we were building
-– a software product -– but also was much clearer when it came to the benefits our product would deliver.
WHEN AND WHAT TO CUSTOMIZE
When it comes to customizing your elevator pitch, there are a couple of things to keep in mind.
First, it is important that you keep your summary sentence fairly consistent. You want your summary sentence to be understandable by the widest possible range of people since, in many situations, it may be all that you have time to say.
Second, most customization should be done in the close of your elevator pitch. You want to make sure that everyone has the same basic understanding of what you are doing and why. However, since the last thing you say will tend to linger with the audience, you want the last thing you say to be especially relevant to them.
THE MIXED OR MYSTERY AUDIENCE
While you should always strive to use the version of your elevator pitch that is the best fit with the interests of the audience, this isn’t always easy to do. In some cases, you may not know who is in the audience. In other cases, the audience may be made up of a mixture of potential investors, partners, customers, or all three.
What should you do?
If you don’t know who is in the audience, or the audience is made up of a mix of people, then the thing to do is to use the version of your elevator pitch that targets the people with whom you most need to speak at the moment.
If you are very early on in the process and are still trying to put your Solution together, then the version to use is the employee-focused version of your elevator pitch. If you have put your team together and your main need is money, then use the investor-focused version of your elevator pitch. If you have a team and money, then use the customer-focused version of your elevator pitch.
That way you will speak most directly and powerfully to members of the audience with which you most need to speak. However, since your elevator pitch isn’t overly focused on one audience, the other members of the audience will still get a basic understanding of what you are doing and why.