by: Scott Swanson
This document is about marketing expensive products to large businesses. The bulk of my experience is in software, but the principles outlined here could apply to any high margin industry. Why high margin? Because there is very little product cost to incremental sales, so those organizations can invest heavily in effective marketing and sales and still maintain profitability.
An extreme example of this is Microsoft. They make Windows and Office, among other things obviously, but these are their two most ubiquitious products. The cost of making this software is beyond comprehension, but once it’s made, future production costs are nothing more than hosting the software for download and generating activation keys. The money to make the product itself is already spent — so the cost driver becomes getting it in the hands of users and then supporting those users.
That’s a differentiator in software, but there are other high margin, sales-centric, industries with similar economics where the methods discussed here could also apply. I’d not be surprised to see someone you’ve never heard of apply these principles to their niche and quickly become the dominate player. Examples:
- Commercial Real Estate Leasing and Sales
- Pharmaceuticals (to Healthcare Providers)
- Enterprise Financial Services (Banking and Insurance)
- Professional Services (Accounting, Legal, Business Consulting)
- Others (I welcome additions)