I was recently at a fine art gallery in Carmel, a resort town in California. A 16" by 20" black and white photo (unframed) was listed for $2,000 -- about triple what that artist charged a few years ago. But wait. $2,000 was the price if you bought one of the first ten copies sold; the next ten listed for $4,000 each, the next ten for $6,000, etc. Now don't get me wrong -- these were beautiful works, capable of bringing great pleasure and possibly appreciating in value. But wow.
I don't know if the gallery moves a lot of art at those prices, but they seemed busy and authentic. Nice work if you can get it -- and I say that with complete respect for the artist, their work, the gallery owners and the free market.
I think this story has some special lessons for cleantech execs. Cleantech is a young industry. As with many young technology-based industries, there can be a tendency to focus on features, rather than on what builds markets and sales. Here are some lessons triggered by our fine art example:
--Make your product an object of desire: This artist surely has. Tesla has. They are each fulfilling a want. Remember that this doesn't have to apply just to sexy cars.
--Get your customer wanting to pay your price: Customers talk themselves into spending thousands on an art photo. Recurve gets homeowners to pay several hundred dollars for an energy audit that summarizes savings from a retrofit. The U.S. Navy may choose to pay above-market prices to experiment with biofuels. Tapping emotional, political and pragmatic buttons allows you to turn customer desire into a willingness to pay. This can work whether your customer is a consumer, a professional, a business or a government agency.
--Let customers buy into a movement: The artist and gallery have art shows, receptions, beautiful postcard mailings, websites, and perhaps an opportunity to follow their latest photo-taking trip via Facebook. They are inclusive. Cleantech firms can use PR, visibility and social networking tools to build their brand, whether it promotes the use of their lithium-ion cell, explains how aerogel insulation reduces energy use at oil refineries, or describes the benefits of a green concrete additive.
--Deliver actual value: Your product has to work and deliver something special. The expensive photo delivers a smile, status or a self-reward. What tangible, economic and intangible value does your product or service deliver?
So, what's the 'how-to' on applying the lessons above? Here are some key steps:
--List all the value you deliver: This is an internal exercise and a starting point. Be creative. Explore 'softer' dimensions: perhaps politics ('gives our nation energy independence'); flexibility ('locate your factory anywhere, even with no power grid, with our fuel cell'); self-actualization ('helps you tread lightly on the planet'); etc.
--Figure out who you're looking to influence, why, and when: This issue is tied to market development, your stage of company and product development, and competitive environment. Your target(s) evolve over time. You need to map this out, explicitly.
--Create the story: The right story will hit the nail on the head for the people you're trying to influence. Outside of tech, many high-end wineries do a great job with their story, creating a bond that gets people to buy. A story that ties you -- and the buyer -- to a bigger picture, and that has inherent drama, helps to create higher perceived value. Over time, this helps build attention and sales, and supports your pricing. As Seth Godin said in All Marketers are Liars: "We believe what we want to believe, and once we believe something, it becomes a self-fulfilling truth."
--Choose programs that connect your targets and story: This ties to objectives, rollout strategy and ongoing marketing/sales programs and budgets. A cleantech company looking to burst onto the scene might: start with a tight, compelling investor-oriented message at a venture conference; go after industry awards that anoint you as a leader-in-the-making; bridge into business and financial press; and follow up with industry-specific marketing and sales programs that get a boost from the business 'air cover' you've built.
Cleantech firms can borrow ideas about strategy, positioning, pricing and more from many industries. As Ferris Bueller said: "Life moves pretty fast. If you don't stop and look around once in a while, you could miss it."
Steve Weiss helped make green building materials compelling while at Serious Materials. Contact him at firstname.lastname@example.org