In Business Development Strategy

Being in business development and marketing for as long as I have has turned me in to a bit of a cynic. Google has made its online office tools, Docs, Spreadsheets etc. available as a hosted solution free for educational organisations in the US, and announced in this post, (Official Google Blog: Nonprofits mix it up with Google Apps), that it has now extended this to non-profit making organisations too.

Is this Philanthropy, or a clever marketing ploy? Think about it. If you’re old enough to remember the early days of Microsoft, you’ll remember that it implemented a similar strategy. In fact, most software companies still do.

This strategy works in a number of ways:

  1. The educational sector is pretty communal, there’s lots of sharing of ideas and word of mouth, so plenty of organic growth.
  2. It’s a very large, well defined sector that will create a large user base very quickly.
  3. Most importantly, what do we trust most as users? We trust what we know. As human beings, we don’t typically like change. When we’re getting educated, we use the tools we’re presented with because we don’t know anything else. When we leave education, we want to use those same tools that we’re comfortable with.

This strategy, often called ‘seeding’, produces exceptional results in the medium to long term, but you need a lot of funding to survive the investment period (like Google, for example).

I prefer to call it, a ‘candy sale’. Here, try this. Isn’t it great? Now, you want to give it back, or buy it?

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  • brockhenderson

    Apple does the same thing with their computer. They have donated thousands of computers to schools; and of course the kids then want an Apple for home to be compatable with the school computer for homework assignments, etc.

    It is a clever and effective technique.

    Good blog BTW