I have been thinking about why there are (relatively) so many tech companies in Switzerland that are doing very well in certain niche markets. As it turns out those markets are often niches in terms of their target customers, who are the conservatives, or laggards as Geoffrey Moore would call them in his technology adoption life-cycle curve. This is the tail end of the bell-shaped curve, indicating the end of a product. But this end can be a very long and also a very lucrative one. Also the way you have to market here is entirely different than at the beginning of a new product innovation. Important in this phase are:
- making the product simpler, cheaper, more reliable, convenient to use and possibly split it up into simpler components
- engineering's task is therefore not to add cool/new features but rather the opposite, cutting every unnecessary detail in order to deliver the above product requirements.
Why the above is mandatory becomes clear when you look at the typical conservative/laggard customer profile:
- risk averse, often even technology shy, very price sensitive, need bulletproof solutions
- they buy technology to just stay even with the competition
- require often a single trusted adviser to help them make sense of technology.
Swiss people are very good in many of the above areas. They are used to building things with highest quality, reliable but also cost efficient (are masters in manufacturing process optimizations). Also they are excellent - trusted - advisers who have long term business relationships in mind.
The same reasons why they are good in this phase also explains why they are not good at all in the early adopter phase where things are a rush and lots of risk taking on the part of both suppliers and customers is required.
