Software Product DevelopmentEnterprise vs. Consumer

Brad Hoover

Brad Hoover bio

CEO Grammarly, Inc.

Formerly 6+ years as investor with VC firm General Catalyst Partners, management consultant with McKinsey & Company, and just enough time dabbling as a coder to appreciate the difficulty!

Board member MocoSpace; leading venture-backed mobile social gaming destination site.

About Grammarly

Proud Sponsor of AgileBaseCamp

Offices in SF and Kyiv.

Currently hiring for a variety of positions in Kiev, including a product manager.

Consumer Saas business providing leading writing enhancement tool

Industry leading product with highly engaged users.

Exceptional team with track record of success.

Large scale with nearly 10M annual uniques and many paying users.

The essence of Product Development

Identify need: why doesn’t it exist already?

Initial product development: reduce risk (cost and time).

Iterate product to go mainstream: improve product feature set to increase quality (sales, LTV) and scale (total available market).

Enterprise vs. consumer: A comparison

Serve enterprise customers, not

individuals.

Generally paid; enterprise

procurement with seat license

model; security and uptime

critical.

E.g., Office365 (MS), Salesforce,

GoodData, etc.

Serving individual users.

Usually free or free offering; paid

by individual credit card, cell

phones, e-money, etc. (if paid);

security/uptime may be less

critical.

E.g., Google search, Facebook,

Kayak, etc.

Enterprise Consumer

Comparison: Identify Need

Someone from the industry or

function served, who understands

all details of the market

opportunity/need.

Enterprise Consumer

Need of the founder based on life

experience, generally outside of

work.

Comparison: Initial Product Dev

Extensive upfront design and

prototyping.

In person conversations and

demos fine tune the product,

often with customer input.

Develop hypothesis to infer broad

customer needs from in person

conversations, surveys etc.

Test the hypothesis on real users

to find the local maximum (A/B

testing; multivariate testing).

Less upfront design and

prototyping work for new features,

infer customer input via tests.

Enterprise Consumer

Comparison: Iterating product to go mainstream

Gain credibility with reference

customers.

Expand the feature set to provide

enough appeal to boarder market.

Business development deals to

reach large market.

Sales force can overcome

objections in person.

Develop the best product in the

market.

Expand feature set to solve a

broad need.

Generate word of mouth/viral

adoption.

Enterprise Consumer

Summary: enterprise

Enterprise

Good product with great marketing/sales may beat the reverse, as sales force can overcome the objections through conversations.

Higher need for security & stability.

Lends itself well to outsourcing model.

Summary: consumer

Consumer

Requires truly exceptional product with very fluid funnel and interface, to sell without speaking.

High need for speedy iterations to test hypothesis (infer collective needs/preferences of user base).

Benefits from entire product development team (product + engineering) in same location to facilitate rapid communication/iteration.

Shared guiding principals

Focus on a clear, achievable goal; launch as little as possible to provide initial value.

Create a flow environment so the team is “in the zone”:— Clear feedback on progress towards goals;

— New skills/challenges;

— Autonomy, especially around “how”.

If total addressable market (TAM) is not large enough then black to the drawing board to find a larger hill.

Consumerfication of enterprise apps

Saas enables introduction of ”prosumer” enterprise products with similarities to consumer products and development process.

These prosumer apps may have a superior user experience/workflow vs. strict enterprise alternatives, and are well positioned to take market share as a result.

A trend to follow (e.g., Google Docs, Evernote, Grammarly).

If you have interest in working for Grammarly, go to www.grammarly.com/jobs and review…

Product manager (coding background)

QA lead

Natural Language Processing developer

Desktop .Net developer

Affiliate relationship manager (sales)

Thank you