INDUSTRY BRIEF · 01 OF 04
Consumer Technology.
Software, hardware, and consumer services where the buyer is fragmented, the switching cost is variable, and the brand is the only durable moat.
SUB-SECTORS
Where we work.
Vertical SaaS
Brand-defensible when positioned against horizontal incumbents; the vertical language is the moat.
Consumer Software
Switching costs are variable, the buyer is fragmented, and the brand is the only durable moat.
Hardware & Devices
Brand is the price umbrella; the OEM/ODM cost is not a moat. The position must be defensible to the press, the analyst, and the retail buyer.
Consumer Services
Two-sided markets where the brand is the demand-side signal. The supply side follows the demand.
Marketplaces
The brand is the trust signal. The marketplace is only as good as the buyers’ and sellers’ confidence in the brand.
WHAT MAKES CONSUMER TECHNOLOGY DIFFERENT
Four conditions that make the work different.
Fragmented buyer
The consumer technology buyer is fragmented across channel, segment, and use case. A position that works for the prosumer does not work for the enterprise. A position that works for the enterprise does not work for the prosumer. The work is the segmentation.
Variable switching cost
Switching cost varies dramatically across the buyer base. The right customer is the one whose switching cost is highest. The wrong customer is the one whose switching cost is lowest. The work is the customer selection.
Platform risk
A consumer technology company that depends on a platform — Apple, Google, Amazon, Microsoft — is at the platform’s mercy. The platform can change the rules at any time. The work is the platform diversification.
Press cycle
The consumer technology press cycle is the fastest in the economy. A product launch, a press leak, a competitor move, an analyst note can each reset the conversation in 24 hours. The work is the press cadence.