Lead to Win Sales Funnel Mapping

Welcome to Lead to Win
Wednesday, October 26, 2011

Slide 1 Lead to Win

Day 2

Stephen Davies Opportunity Development –
(Third Core Venture Partners) Making & Managing Sales

Natalie Raffoul Business aspects of patents
(Clancy P.C. + Brion Raffoul) and intellectual property

David Hudson Customer & partner value
(Carleton) propositions

Tony Bailetti Day 2 takeaway messages
(Carleton)

Slide 2 Lead to Win

Lead to Win

“Opportunity Development – Making & Managing
Sales”

Stephen Davies
Third Core Venture Expansion Partners

Slide 3 Lead to Win

Agenda

• Overview
• Sales drivers
• Sales execution strategy
• Customer types
• Sales funnel
• Map funnel information to cash flows
• Summary / Tasks Post Phase 2

Slide 4 Lead to Win

Overview

• Upon completion,
– You will know about
• Sales Execution Strategy
• What a sales funnel is
• Linking sales to cash flows

– You will know how to
• Categorize and prioritize customers
• Build a realistic funnel for your organization

Slide 5 Lead to Win

Overview

• What this course is
– Understanding the drivers of sales
– How to setup and manage sales
• What this course is NOT
– How to sell
– How to market
• Terminology that is assumed
– Inside/outside sales
– Distribution channel
– Direct/indirect sales
– Others

Slide 6 Lead to Win

Overview

Slide 7 Lead to Win

Sales Drivers – Technology Adoption

Based on a graphic by Pnautilus (http://en.wikipedia.org/wiki/File:DiffusionOfInnovation.png), published under a CC BY-SA 3.0 license.

Slide 8 Lead to Win

Sales Drivers – Technology disruption

Source: Wikipedia
Slide 9 Lead to Win

Sales Drivers – Blue Ocean

Slide 10 http://blog.delaranja.com/wii-a-blue-ocean-strategy/ Lead to Win

Sales Drivers – The Long Tail

Movie
rental
stores

Online distribution (e.g. Netflix)

Number of products

Slide 11 Lead to Win

Sales Drivers – Want vs. Need


Sales Drivers – Features & Benefits

What is a feature? What is a benefit?

We sell the benefits of a product or service not
the product or service itself

If a feature does not give a benefit to the end user
then the feature is useless


Sales Execution Strategy

Barriers to Sales
• There is a lack of available sales talent and sales
leadership talent
• There is a distinct lack of clarity and consistency among
investors.
• Startup operations are focused on feature development,
not on scaling sales.



Developing a strategy
• Who are the most influential customers in the target market?
• What are the poignant business issues that they face?
• What are the tactical problems that are created?
• How might the value proposition address these problems and what
impact would it have?
• How motivated might they be to buy, given the value proposition?
• Who would they consider the competition to be?
• How would the customers perceive the difference between the startup
and its competition?
• What would they be prepared to pay?
• How and for what would they pay?
• Who would they tell?



A working document that contains
1. A clearly defined and tested product value proposition relating to the
early and late majority customers in the market.
2. Tested price points for the product including quantity discounts.
3. Adaptive pricing options along the adoption lifecycle.
4. Clear competitor differentiation.
5. A set of sales collateral built on the above points and supported by
testimonials from pilot projects.
6. A clear target profile of the early and late majority customers to aid in
the tactical implementation of the product sales.
7. Timelines for product release based on a realistic product development
strategy.
8. A clearly defined plan for ongoing customer service.



Implementation
• The efficiency and appropriateness of the manner in which the
prospect is accessed and engaged. The more complex the process
and the more senior the decision makers, the more likely a traditional
field sales model is appropriate
• The price of the product and its strategic impact on customers’
businesses. The lower the price and strategic impact, the more likely
that the use of telephone sales professionals or resellers is
appropriate.
• The scale of the market and the depth of relationships required to
provide further context. The larger the market and the lighter the
touch, the more likely that web-based lead generation and nurturing
tools are required to automate and scale the approach used.



Supporting an execution strategy:
• Market and domain experience is important but can easily be
overrated. A big rolodex is much less important than most people
assume.
• Recruit for demonstrable competency and capability. Both of these
attributes are predictors of successful execution. Behavioural
interviewing can assist in predicting probable future behaviours.
• Take the time to role play. Ask candidates to walk through a selling
conversation for their current company or product. Do they ask lots of
questions or do they start pitching straight away? For sales leaders,
can they elevate beyond sales theory and actually sketch out a sales
execution strategy for the business?


Customer Types

Characteristic Comments
• “A” Customers
– ‘Bring me a proposal I can sign.’
• “B” Customers
– ‘I like the product, but I need to do more research before I can
decide.’
• “C” Customers
– ‘Yes, we have that problem, but I don’t know what to do about it.
We get by. How does your product relate to our situation?’
• “D” Customers
– ‘We have no problems like that in our organization.’


Customer Types

Communication
• Close “A” customers. Get them to buy your product.

• Convince “B” customers: Provide them with additional
information to make a decision, and reinforce your
company as the best choice (share of mind)
• Coach “C” and “D” customers and use public presence as
a means to gain credibility with them—and access to them.


Customer Types

Customer Types and Technology Strategy
• Technology disruptions encounter “C” and “D” customers
– Longer sales cycles
– More subject matter expertise marketing
– Evangelical sales model
• Technology increments encounter “A” and “B” customers
– Shorter or immediate sales
– More product level marketing
– Direct sales model


Sales Funnel

What is a sales process

Source: Wikipedia

Sales Funnel

How does it work
• We take a generic, or organization specific list of stages
and assign probabilities to each stage.
• The probability represents the likelihood that the customer
will move to the next stage of the pipe
• New Opportunity (5%)
• Initial Communication (10%)
• Fact Finding (25%)
• Develop Solution (40%)
• Propose Solution (60%)
• Solution Evaluation (75%)
• Negotiation (85%)
• Contracts (95%)
• Closed won (100%)

Sales Funnel

Lead Yield Funnel Stage
30 “Raw” Confidence of Day 1
Winning 10%

20% Day 22
45% Day 44
60% Day 94
80% Day 160
90% Day 180

1 Won 100% Day 183


Sales Funnel

Third Core starts off with the following assumptions:
• 640 quality calls yield
• 80 conversations which result in
• 16 leads
• 4 of which become prospects
• 2 of which become qualified
• 1 one of which leads to a deal!


Sales Funnel

Sales funnel qualification
• Budget. Does the prospect have access to sufficient funds to
make this purchase? Can this be validated?
• Authority. Does the “buyer” have the authority to make a
purchase decision? Can this be validated?
• Need. Is there a compelling business need for the product or
solution? What is the specific value to the customer? Can it be
verified that the need for a solution is meaningful to the
customer?
• Timescale. Has the timescale been established during which
the need must be addressed? What are the specific steps and
timings of the buying process?


Sales Funnel

Doing it in practice
• For simple funnels use excel
• If you have a larger number of customers good idea to get
a CRM system, for example:


Sales Funnel

Doing it in practice example 1 (from provided template)

Totals/Average 47% $300,000 $142,500 06‐Feb‐10        177
Stage Contract Funnel Est Close Days to
Company Opportunity name Funnel stage probability value value Date close
Steve co Product A New Opportunity 5% $10,000 $500 01‐Jun‐10       291
Bob co Product A and B Initial Communication 10% $50,000 $5,000 15‐Apr‐10       244
ABD Product B Fact Finding 25% $40,000 $10,000 01‐Dec‐09       109
DEF Product A Develop Solution 40% $30,000 $12,000 13‐Feb‐10       183
GHI Product C Propose Solution 60% $50,000 $30,000 15‐Jan‐10       154
Blockbuster Product A, B and C Solution Evaluation 75% $30,000 $22,500 24‐Feb‐10       194
PWGSC Product C Negotiation 85% $40,000 $34,000 04‐Nov‐09         82
CIBC Product C Contract 95% $10,000 $9,500 01‐Sep‐09         18
Lead to Win Product A Propose Solution 60% $30,000 $18,000 01‐Mar‐10       199
Redwood Product B Initial Communication 10% $10,000 $1,000 01‐Jun‐10       291


Sales Funnel

What is a sales funnel
• A tool that help you assess using different metrics how
healthy and balanced your future sales are. It will tell you:
– At what stage a customer is in the sales process
– What value of opportunity is associated with a customer
– How long customers are taking to move down the pipe
– Gross figure on how many customers are at what stage
– Project $$ revenue forecasts for your cash flow statements


Map the funnel to cash flows

Cash flow estimate:

Cash injection into cashflow is:
(closing date + credit terms)
at a value of
(deal size * funnel stage probability)



Funnel Est Close
Company Opportunity name value Date Sep‐09 Oct‐09 Nov‐09 Dec‐09 Jan‐10 Feb‐10 Mar‐10 Apr‐10 May‐10 Jun‐10
Steve co Product A $500 01‐Feb‐10 $         500
Bob co Product A and B $5,000 15‐Apr‐10 $
5,000
ABD Product B $10,000 01‐Dec‐09 $
10,000
DEF Product A $12,000 13‐Feb‐10 $
12,000
GHI Product C $30,000 15‐Jan‐10 $
30,000
Blockbuster Product A, B and C $22,500 24‐Feb‐10 $
22,500
PWGSC Product C $34,000 04‐Nov‐09 $
34,000
CIBC Product C $9,500 01‐Sep‐09 $
9,500
Lead to Win Product A $18,000 01‐Mar‐10 $
18,000
Redwood Product B $1,000 01‐Jun‐10 $
1,000
Totals $142,500 $9,500 $0 $34,000 $10,000 $30,000 $35,000 $18,000 $5,000 $0 $1,000

With no credit terms



Funnel Est Close
Company Opportunity name value Date Sep‐09 Oct‐09 Nov‐09 Dec‐09 Jan‐10 Feb‐10 Mar‐10 Apr‐10 May‐10 Jun‐10
Steve co Product A $500 01‐Feb‐10 $         500
Bob co Product A and B $5,000 15‐Apr‐10 $
5,000
ABD Product B $10,000 01‐Dec‐09 $
10,000
DEF Product A $12,000 13‐Feb‐10 $
12,000
GHI Product C $30,000 15‐Jan‐10 $
30,000
Blockbuster Product A, B and C $22,500 24‐Feb‐10 $
22,500
PWGSC Product C $34,000 04‐Nov‐09 $
34,000
CIBC Product C $9,500 01‐Sep‐09 $
9,500
Lead to Win Product A $18,000 01‐Mar‐10 $
18,000
Redwood Product B $1,000 01‐Jun‐10
Totals $142,500 $0 $0 $9,500 $0 $34,000 $10,000 $30,000 $35,000 $18,000 $5,000

With 60 day credit terms


Exercise #1 – Building Sales Funnel

Using Exercise #1 – Worksheet
1. List 10-20 potential customers and identify customer type
(A,B,C or D) for
– Leads
– Qualified Prospects
– Already engaged

2. Define Funnel Stages and according percentage values.

3. Populate the rest of worksheet for all fields


Exercise #1 - Worksheet
3

Customer
1 Customer
2 Stage Probabitlity
Contract
Funnel
Value
Estimated
Product Funnel Stage Value Close
Name Characteristics (%) (Stage Prob *
($) (month/year)
Contract Value)
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
A: ready to buy New Opportunity 5%
B: need more research Initial Communication 10%
C: have problem, but get by Fact Finding 25%
D: no problem Develop Solution 40%
Propose Solution 50%
Evaluate Solution 75%
Negociation 80%
Contract 90%
Close 100%


Exercise #2 – Sales Funnel Cash Flow

Using Exercise #2 – Worksheet
1. Transcribe Funnel Value and Closing date information filled
in Exercise #1 Worksheet into Exercise #2 worksheet
2. For each customer entry, enter the Funnel value into the
appropriate closing date column
3. Calculate totals for each months
4. Identify your typical credit terms: ___ days
5. Change closing date months to reflect credit terms
6. Analyze cash flow requirements


Exercise #2 - Worksheet
2

Funnel
1
Estimated
Value
Close Sep-09 Oct-09 Nov-09 Dec-09 Jan-10 Feb-10 Mar-10 Apr-10 May-10 Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10
(Stage Prob *
(month/year)
Contract Value)
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
Totals

3


In summary

• Focus on required product features that are meaningful to the early and
late majority, not on features that only excite early adopters and
technology enthusiasts.
• Structure the company operations to enable quick and rapid scaling to
support the sales team.
• Develop a sales execution strategy that matches a value proposition to
the early majority.
• Roll out the sales execution strategy using real metrics and a funnel
that is appropriate to your particular market.
• Recruit effectively (as described above) to maximize the revenue
potential and minimize the cost of sale.
• Utilize effective technology to support the sales execution process.
• Engage only in marketing activities that directly generate qualified
leads.


Participants Open Discussion


Post Phase 2
Tasks


Follow up tasks

Task 1 to complete for your business
1. Identify appropriate market segment to release technology into
2. Review list generated during Exercise #1 and add more target
customers
3. Blue ocean helps you differentiate from your competition, even if
you are not disruptive – perform analysis
4. This will enable you articulate key differentiators to your target
customers
5. Start phoning. For each call categorize the customer
6. Identify and implement your own strategies for moving up the
chain
7. Only return (initially) to the highest ranked customers for ongoing
business development

Follow up tasks

Task 2 -Doing it in practice - extend the example
Simple additions that are valuable are (in no particular order):
1. Funnel value by month – vital for cash flow forecasting
2. Average number of days per funnel stage (too see where your
“blockages” are)
3. Estimated vs actual close
4. % dropouts at each stage of the pipeline (closed lost)
5. Keep track of the contract value as it changes (initial estimate –
final) to see how accurate your estimating is


Lead to Win

“Business Aspects of Intellectual Property”

Natalie Raffoul, P.Eng. (Electrical), J.D.
Registered Patent Agent, Lawyer


Disclaimer

• This presentation provides general
information regarding some basic principles
of intellectual property law. It does not
constitute legal advice and should not be
relied upon as such.
• If you have a particular question for which
legal advice is required, please seek
independent legal counsel.
• I am a lawyer, but I am not your lawyer.


Overview

• What is intellectual property?
• Protection and Filing Strategies:
– Patents
– Trade-marks
– Copyright
– Industrial Designs


What is Intellectual Property
• Intellectual Property (IP) refers to creations of the mind:
– inventions, literary and artistic works, and symbols, names,
images, and designs used in commerce

• Under intellectual property law, owners are granted
certain exclusive rights to a variety of intangible assets


What is Intellectual Property
• IP is divided into 2 categories:

– Industrial property: inventions (patents), trade-marks,
industrial designs, geographic indications of source; and

– Copyright: which includes literary and artistic works


Types of Intellectual Property
• Patents: inventions

• Trade-marks: brands

• Copyrights: expressive works

• Designs: aesthetic features

• Trade Secrets: confidential info

• Domain Names: www.guinness.com

• Integrated Circuit Topography Act

• Plant Breeders’ Rights


PATENTS

What does a patent get you?

• Grant of limited monopoly for an invention by
government
• Enables owner to prevent others from making, using,
importing or selling the claimed invention for a limited
time


Patent Basics

• “invention” means any new and useful art, process,
machine, manufacture or composition of matter (s. 2
Patent Act)

• Examples: mechanical equipment, computer hardware,
software, packaging materials, processes for making
products, pharmaceuticals, vaccines etc.


Patent Basics

• Patentability Requirements:

– Subject Matter
– Novelty
– Non-Obviousness
– Utility


Parts of Patent Application

• Specification
– Description of problem and prior art
– Description of invention and implementation
– Drawings are an important tool for understanding the invention
(US requirement)

• Claims
– Defines what is protected


Overview of Patent Process
• Prior art search
• File application
• Publication
• Examination
• Prosecution
– Arguments
– Claim amendments
• Patent Grant and Annuities


Importance of Dates

• First-to-file systems

– First to file patent application to an invention prevents others
from patenting that invention

– NEWS: US has a passed the America Invents Act => now first-
to-file in the US with some exceptions


Importance of Dates

• Priority System
– Convention priority benefits of earlier date

US
JP
(months) 0 12
EPO
CA
Other


Where should I file?

• In which countries are your main competitors?

• In which country are products in your industry usually
manufactured or where are your services being
sold/used?

• Where is a potential licensee?

• What is the worldwide market for the licensee?


Different Jurisdictions

National Patent Offices
◦ Patent issues: e.g., Canada, US, China

EPO (European Patent Office)
◦ Covers most of Western Europe
◦ EP patent issued but must be validated in various countries

PCT (Patent Cooperation Treaty)
◦ Patent application deferral strategy: can delay filing in multiple
countries/regions


US Patent and Trademark Office

PROS:
• Provides coverage for a large market
• Most inventions are patentable
• Relatively easy to get a patent
– Claim scope may be affected
• Allows provisional applications
• One (1) year grace period for published inventions


US Patent and Trademark Office

CONS:
• Case law keeps changing
• Because of changing case law, different rules
may be applied to different patents/applications
• Notorious for delays in prosecution
• Prior art searching may not be as thorough
• Can get expensive if prosecution is prolonged


Canada

• Relatively cheap to file and prosecute applications
• Easy to get a patent –Patent Prosecution Highway
(PPH) with US, JP, DK, KO, etc.
• Cheaper to litigate than US
• One (1) year grace period
• Rounds off coverage for North America


European Patent Office

PROS:
• Provides coverage for most of Europe
• Prior art searching is good
• Short prosecution time frame


European Patent Office

CONS:
• Expensive to file and prosecute applications
• Difficult and expensive to get a patent if you do not
follow Examiner’s lead
• No grace period (absolute novelty)


Chinese Patent Office (SIPO)

• Relatively cheap to file and prosecute applications, even
with additional translation costs
• Fastest growing consumer market
• No grace period (absolute novelty)


Patent Cooperation Treaty (PCT)

• Mid-range in cost
• Provides preliminary prior art search and written
opinion on patentability
• NO world patent

• However, national/regional examining authorities will not
always follow PCT examination results
• News: PCT-PPH Agreement with CIPO


Filing Strategy Considerations

• Offensive reasons
– Infringement is highly likely
• Defensive reasons
– Cross-licensing opportunities
• Funding purposes – VCs, angel investors, gov’t
funding
– Ex: start-up in OT that’s gone bankrupt, but their patent portfolio
is still alive because there is a good technology there


Cost of Patenting vs. Coverage

• Initial Application Costs
– Drafting costs for patent application
◦ Depends on complexity of invention
◦ Provisional application - $2.5k to $4k
◦ Full application - $4k to $8k
◦ Written for filing in all jurisdictions


Cost of Patenting vs. Coverage

Balance cost vs. advantage/coverage for the application

◦ US application – approx. $2k to file
Covers large potential market
◦ CA application– approx. $1.5k to file
◦ Cheap and covers off North America
◦ EPO application – approx. $9k to file
◦ Covers off most of Europe

◦ PCT application – approx. $5k to file
◦ Delays costs


Pitfalls and Suggestions

• Filing a cheap/poorly drafted application can increase
prosecution costs later…

• Badly drafted applications CAN destroy your rights
– Improper coverage of invention by bad claim drafting
– Missing details may make application useless

• If unsure of patentability of invention, consider a
patentability search and opinion


Licensing Economics

• IP Licensing can generate significant amounts of
revenue
– Corporate example
– MOSAID (Ottawa based tech licensing company)
» 3Q 2008 revenue of $14 million (all licensing revenue)
» By 3Q of 2008, portfolio will have 924 patents applications
worldwide
» Projected 2008 licensing revenue is $55 million
» Very aggressive licensing and enforcement regime


Patent Licensing
• Why license?
– Generate revenue for research
– Can off-load patenting costs

• Why file internationally?
– More IP to license: different jurisdictions can be different
licenses
– Possibility of technology partnerships with international
industry


Licensing Basics

• Finding licensees
– Consider marketing invention
– Determine key players in the field
– Contact and offer technology
– Don’t forget non-disclosure agreement (NDA) if required
– Broad-based marketing campaign

• Starting point: Standard licensing agreement


License Terms
• Consider the following for license terms:
– Milestone payments
– Minimum annual royalties
– Signing bonus/fee
– Reimbursement of costs for initial patenting activity
– Continuing costs of patenting to be borne by licensee?
– Percentage royalty on sales or flat license fee?
– Who pays for and owns future developments?


Royalty Considerations
• What is a “fair” royalty rate?
– US universities generally use the “25% Rule”
• Approx. 25% of licensee’s anticipated pre-tax profits
– 25% Rule is a good starting point
– Royalty depends on circumstances of the license, the
technology, the market, etc.
• “Risk” or discount factors?
– Time to market for product?
– Revenue generation timeframe?


TRADE-MARKS
• A patent protects the technical aspect of a product, or
know-how. Once you've developed a product, how do
you market/sell it?

• This is where trade-marks come in

• Trade-marks = allow you to connect with consumers


Trade-mark Basics
According to TM law: the key role of a trade-mark is to
identify the source of a product or service.

In other words, to distinguish wares and services of one
trader from those of another.

Ex.
- DOVE mark identifies soap manufactured by Unilever
vs. Johnson & Johnson


Trade-mark Basics
• In reality, trade-marks do more than merely identify the
source of a product/service.

• Trade-marks actually SELL goods and services = visual
sound bites

• Advertisers spend millions associating TMs with imagery
designed to create impulse buying
• eg. COKE brand creates thirst


Branding
• A trade-mark/brand can be the key to business
success consumer recognition SALES

– MP3s - Diamond Multimedia Rio PMP300 v. iPod®

– Vodka - GRAY GOOSE® v. SMIRNOFF®

– Not only luxury goods - NO NAME®


Objectives
• What are the objectives of a good brand?
– delivers a clear message
– confirms credibility
– connects you with target consumers
– motivates consumers to purchase
– creates loyalty, trust and GOODWILL in your
products, services and business


Trade-mark Basics
• What is a trade-mark?

– Word: BURTON
– Word & Design: NIKE & SWOOSH
– Design: PEPSI Circle Logo
– Slogan: “I’M LOVIN’ IT”
– Device: Pillsbury Doughboy
– Shape: shape of COCA-COLA BOTTLE


Trade-mark Basics
– sounds (i.e. NBC chimes)
– colour (TIFFANY blue)
– smell (scent of cut grass on tennis balls)
– Holograms, motion marks

• In Canada, the technical limitations of our legislation,
prevents the protection of many non-traditional marks,
but the law is evolving.

• Non-traditional marks may still be protectable against
passing at common law?


Strong Marks
• strongest marks = inherently distinctive
– (a) non-descriptive,
– (b) coined or invented, and
– (c) unique
• Ex: EXXON ®, XEROX ®, KODAK ®

• strong marks - words that bear no relation to the
product, industry or field
– APPLE ® for computers
– RED ROSE® for tea


Weak Marks
• Weak marks: words that have a clear connection with,
or are descriptive of the wares and services

• Ex:
– ALL BRAN for cereal


Strong Marks
• By selecting a trade-mark that is non-descriptive,
unique, and preferably coined, you

– increase the sphere of protection for your
trade-mark and
– minimize the risk that your trade-mark will
infringe other trade-marks in the marketplace


NOT Registrable
What is NOT registrable as a trade-mark?

– word(s) that are primarily merely the name or surname of an
individual who is living
• Ex. SMITH (exception marks that have acquired
distinctiveness i.e. “GIORGIO ARMANI”)

– words that are clearly descriptive or deceptively
misdescriptive of wares/services or their place of origin
• "FOAMY" for shaving cream
• "MEXICAN" for tequila
• "SILK WEAR" for clothing that is not made of silk


NOT Registrable
• the name in any language of the wares or services
– Spanish JUGO for juice

• anything that is confusing with a prior registered trade-
mark

• Prohibited marks (incl. Obscene marks, Official Marks,
Flags, Red Cross...)


Searching
• Once you have identified a potential TM, the next step
REGISTRABILITY SEARCH
• Not mandatory but HIGHLY recommended
– Will save you time and $$
– Will help you identify obstacles to both
registration and use of the mark
– Better to know in advance – registration
process is over 18 months!


TM Registration Process

• Trade-mark protection is national in scope therefore
you will need to conduct searches and file applications
in each jurisdiction where the mark will be used

• Canadian Registration Process in a Nutshell
– Filing Formalities Examination Approval Publication
Opposition (if any), Allowance Registration
– Canada is now essentially a first to file jurisdiction - DON'T
DELAY
– Any number of wares and services - no extra cost BUT choose
carefully b/c will need to prove USE


Registration
• The Registration Process in a Nutshell

– Registration process = long 18 months, or longer if
application is opposed.

– Term of Registration is 15 years (most other jurisdictions, only
10)

– Cost is in range of $2000+ for straight-forward trade-mark
prosecution

– Trade-marks may be renewed in perpetuity


Benefits of Registration
What are the benefits of a TM Registration?
• “right to the exclusive use of the mark across Canada"
in relation to goods/services specified in registration”
• Tangible proof of ownership
• Public notice – deters others from adopting/using a
confusing mark
• TM Office will reject subsequent applications that are
confusing with registered marks
• A trade-mark registration is useful for protecting a
domain name


Unregistered Marks
• Are unregistered marks protected?

– Yes, BUT…
– Common Law rights are limited:
• restricted geographically
• remedy limited to an action for "passing off"
(cannot sue for infringement, depreciation of
goodwill)
• expensive to enforce


• “Passing off” aims to prevent misrepresentation

• MUST prove:
• A reputation or goodwill
• A misrepresentation by the defendant causing
deception
• Damage/Injury to the plaintiff


5 KEY POINTS
1. Canada is a use-based jurisdiction

– USE IT OR LOSE IT: Registrations can be expunged
for non-use

– BE CAREFUL as to the date of first use:
• If actual use of the mark commences after the
date of first use claimed, the application may be
successfully challenged


5 KEY POINTS
2. Avoid Generic Use of TM
– "Pass me a Kleenex" = WRONG
– "Pass me a Kleenex® tissue" = CORRECT

– a trade-mark should never be used as a noun, in
possessive form or plural form - ALWAYS as
adjective

– the trade-mark should appear in a manner to stand
out from regular text
– Ex: CAPITALIZATION, "quotation marks", italics, bolding, ® symbol


5 KEY POINTS
3. Trade-mark "Marking"

– TM / MC symbols can and should be used on all
unregistered trade-marks

– ®/ MD symbol can only be used on a registered
trade-mark


5 KEY POINTS

4. Quebec
– doing business in Quebec requires compliance with
their language laws

– can use an English trade-mark in Quebec provided
that:

• you use the ®/MD (marque deposee), OR
TM/MC (marque de commerce) symbols as
notice that you are using the English word(s) as a
trade-mark


5 Key Points

5. Trade-mark v. trade name / business name?

• CAUTION: Clients often confuse a business name
registration, and a TM registration

• NOT the same thing


Trade-mark v. Trade Name

• A trade (business) name is a name under which an
individual or company carries on business
– must registered in each province in which company carries on
business
– purpose = registry for consumer protection
– does not grant positive rights to a trade-name or name
(Ministry shifts onus/risk)
– does not function as a trade-mark


COPYRIGHT
• Copyright means

– the sole right to produce or reproduce (i.e., copy) a work (or a
substantial part of it) in any form

– Simply put, “copyright” means “the right to copy”


Copyright Basics
• Copyright provides protection for

– Literary, artistic, dramatic or musical works (including computer
programs) and

– 3 other areas known as: performances, sound recordings and
communication signals


Copyright Works
• literary works: books, pamphlets, poems, other
works consisting of text, lyrics without music and
computer programs
• dramatic works: films, videos/DVDs, plays,
screenplays and scripts
• musical works: compositions that consist of both
words and music, or music only
• artistic works: paintings, drawings, maps,
photographs, sculptures and architectural works


Other Subject Matter
• performer’s performances: performers such as
actors, musicians, dancers and singers have
copyrights in their performances
• sound recordings: makers of recordings, such as
records, cassettes, and compact discs
• communication signals: broadcasters have
copyrights in the communication signals that are
broadcast


What you can’t copyright
• titles and short word combinations
• ideas: copyright is restricted to the expression in a
fixed manner of an idea, not the idea itself
• names or slogans
• methods
• plots or characters


What you can’t copyright
• factual information: facts, ideas and news are all
considered part of the public domain
• although layout, adaptations and translations of
factual information are protected by copyright
– Ex: magazine article containing factual
information: it is the expression of the
information that is protected and not the facts


Automatic protection
• When you create a work or other subject matter
protected by copyright, you automatically have
copyright protection provided that, at the time of
the creation, you – the Creator – were:
– a citizen/subject/resident of a Berne Convention country, a
Universal Copyright Convention Country, a Rome Convention
Country, or a country that is a member of the WTO


Benefits of Registration
• You don’t have to register to have copyright
protection in Canada
• A certificate of registration is evidence in court
that the registrant is the copyright owner
• But in some countries, you cannot pursue infringers
without registration
– Ex: United States


Registration Limitations

• Registration does not guarantee against
infringement

• Registration does not guarantee that the
legitimacy of ownership or originality in a work will
never be questioned


How long do copyrights last?
• General rule is that copyright lasts for the life of
the author, the remainder of the calendar year in
which the author dies, and for 50 years following
the end of that calendar year
– Protection will expire on December 31 of the 50th year
after the author dies
– After that, the work becomes part of the public domain
• Some exceptions to the general rule apply


Indicating Copyright
• There is no requirement to mark your work under
the Copyright Act
• However, the Universal Copyright Convention
provides for marking with the symbol ©, the name
of the copyright owner and the year of first
publication
– Ex: © Jane Doe, 2011
• Some other countries require such marking


“Fair Dealing"
• Under Copyright Act, “Fair Dealing” provisions
allow individuals or organizations to use original
works without such use being considered an
infringement:
– Criticism and review
– News reporting
– Private study or research
• Act also exempts certain categories of users
– Ex: non-profit educational institutions


INDUSTRIAL DESIGNS
• Industrial Designs are the visual features of
shape, pattern, configuration or ornament (or any
combination of these features) applied to a finished
manufactured article made by hand, tool or machine

• An industrial design must:
– Have features that appeal to the eye
– Must be original


Industrial Design Basics
• A unique design for a chair is an example of an
industrial design
• A well-designed chair is not just a pleasure to sit on, but
also a pleasure to behold
• For most manufactured products, the value depends not
only what they do, but how they look


REGISTRATION
• Registration provides an exclusive right to your
design for up to 10 years from the date of
registration
• Under the Industrial Design Act, you cannot
register:
– A method of construction
– An idea
– The materials used in the construction of an article
– The function of an article


REGISTRATION
• You can register:
– A repeat pattern applied to wallpaper
– The shape of a perfume bottle (trade-mark protection also
available if distinguishing guise)
– The ornamentation applied to a t-shirt
– The visual features of a running shoe


REGISTRATION
• You can’t register:
– The way an MP3 player functions
– The material of which a protective mask is made
– The idea of putting advertising on bus shelters


REGISTRATION
• When to register?
– In Canada, there is no time limit for registration as long as the
design has never been published
• Never made public or offered for commercial sale or use anywhere
in the world
– If your design has been published, you must file a registration
within 12 months of publication


REGISTRATION
• Examination and Search
– Application will be examined to ensure that it conforms with the
formalities of the Act
– Examiner will also undertake a search of existing industrial
designs to determine whether your design is original
– If the design is original and the application conforms to all of the
requirements, a registration will be granted


PRIORITY
• Paris Convention Priority
– Similar to patents, applicants can request convention priority for
design applications
– Someone who has filed for a design registration in one
Convention country has six (6) months to file an application
for the design in another country in order to be given the
same rights as if s/he had filed in the second filing country on
the original filing date


In Summary

Patent Fundamentals

• File early, file often – earliest inventions most valuable

• The “threshold” for patentability is lower than you think!

• Software is patentable

• Do not disclose before filing (use NDA if necessary)

• Work with licenced professionals


In summary

Trade-mark Fundamentals

• Go with a strong mark: “inherently distinctive”

• Avoid its generic use

• Register!


In summary

Copyright Fundamentals

• Assert your rights by marking all works with © …

• Software is better protected by patents

Industrial Design Fundamentals
• Explore this form of protection if your product is likely
unpatentable


Participants Open Discussion


Customer & Partner Value Propositions

October 26, 2011

David Hudson


Define compelling value propositions
for customers and partners
• Upon completion you will know about:
– Compelling customer value propositions
– Ways to define customer value propositions
– Value word equations

• And you will be able to:
– Use customer value propositions to communicate an offer’s
superior value and deliver superior business performance
– Use value word equations to make value propositions persuasive


What a value proposition is NOT

• All of the following are useful but are not a value
proposition in themselves
– Product/Technology/Service
– Brand
– Slogan
– Ad/collateral
– IPR
– Secret sauce

• A value proposition need not be static
– May evolve as your market, customers, competitors evolve
– Likely to retain core elements


Market offers

• A market offer (offer) defines:
– What is purchased
– Rights over what is purchased
– How it is purchased

• Offers:
– Get jobs done for customers
– Solve problems
– Satisfy needs that customers have
– Reduce cost or drive revenue for your customer


Customer value

• Value a company delivers to its customers is referred
to as customer value and can be assessed as:
Customer value =
Benefits from what is purchased
+ Benefits from how it is purchased
+ Emotional benefits
– (Financial + Non-financial burdens)
• This is about why a customer purchases instead of
what a customer purchases and fundamentally
overcomes three issues
– Customer does nothing
– Customer does what the competition says
– Customer does what you say, but not at your price


Partners as force multipliers

• Your other stakeholders may include channels,
suppliers, complementors, customers’ customers,
ecosystem, etc.
• Value propositions for key stakeholders need to be
as compelling as customer value propositions
– E.g., a company that has a channel partner as part of its go
to market strategy will need to deliver both compelling
customer value and compelling channel partner value
• Partners, suppliers, ecosystem all make choices too!
– Likely competing for attention, position, priority, mindshare
• Partner relationship may not be financial, so equation
may deal primarily with emotional benefits


Partner value

• Partner value =
Net financial + emotional benefit – Non-financial burdens
+ Collaboration benefit – Collaboration burden
• Ecosystem collaboration benefits:
– Market entry barrier reduction
– Access to customers
– Operations cost reduction
– Elimination of regional limitations
– Makes niche markets viable
– Leverages international disparities
– Makes scarce skills abundant
– Community/asset reuse


Challenges

• Term “customer value proposition” is used widely, but
no agreement as to what it is
• Unsure as to what makes one compelling
• Loose talk, not backed up by evidence
• Value that is intuitive but not quantified or not
uniquely owned
• We often talk more than we listen
• We often try to put too many points on the table
• Customers do not believe suppliers’ assertions


Strategy – deliberate, not accidental

• Deliver superior value relative to competitors which is
measurable and sustainable
• Make all-in company responsible for defining compelling
customer value propositions
• Define customer value propositions of “resonating focus”
type
• Use customer value propositions to:
– Communicate your offer’s superior value
– Deliver superior business performance
• Use value word equations to make customer value
propositions persuasive
• Use process and tools to demonstrate value

All benefits

All Benefits Favorable Points of Resonating Focus
Difference

Consists of: All benefits All favorable points of Few points of difference
customers receive difference a market whose improvement will
from an offer offer has relative to deliver the greatest value
next best alternative to customer

Answers Why should our Why should our firm What is most worthwhile
customer firm buy your buy your offer instead for our firm to keep in
question: offer? of your competitor’s? mind about your offer?

Requires: Knowledge of our Knowledge of our own Knowledge of how our
own market offer market offer and next own market offer delivers
best alternative superior value to
customers compared
with next best alternative


Favorable points of difference

Difference



customers compared


Resonating focus

Difference



customers compared


Resonating focus

• Also meaning, concise and to the point
• At most two or three key points
– Like a good essay, a good argument
• There are likely many benefits to your product or
service but you must establish which are critical to
the purchase decision
• Concentrate on those points


Most of us

• Need to discover these with our customers and
partners
– But we don’t always listen because we’re busy talking!
• Every pitch is a learning experience
• If you have the benefit, ensure one person from your
team is actively listening
– Asking questions
– Probing for why
– Restating and getting confirmation
• Resist the temptation: “They didn’t get it”


Value elements

Point of Element that makes Point to distance yourself
difference supplier’s offer either superior from all other offers
or inferior to next best
alternative
Point of Element with essentially Point to take off the table
parity same performance or
functionality as those of next
best alternative
Point of Element about which the Point to counter (often
contention supplier and its customers these are the competitor’s
disagree regarding how its points of difference)
functionality or performance
compares with those of next
best alternative
Find significant – order of magnitude – points of
difference for which customers are willing to pay

Make value propositions compelling

Fits: Fits with customers’ and channel partners’
needs to grow and/or make pain go away
Value for all Satisfies requirements and power
roles: relationships of who really buys: (i) economic
buyer; (ii) user; (iii) gatekeeper; and (iv)
advocate
Superior: Better than those of competition (order of
magnitude)
Demonstrable: Based on tangible points of difference that can
be quantified in monetary terms
Substantiated: Claims supported by evidence collected with
customers and channel partners
Sustainable: Sustainable for a long time


Use value word equations to bring
sharp focus on value
• Focus on points of difference
• Equation that concretely demonstrates customer
value proposition using words with which customers
are familiar
• Power reduction cost savings =
[kW spent x number of operating hours per year x $ per kW
hour x number of years system solution in operation] Competitor
- [kW spent x number of operating hours per year x $ per kW
hour x number of years system solution in operation] My Business
Unit


Demonstrate value

Pre-sale talk Post sale evidence
• Promoters’ endorsements • With customer define what will
• Published comparisons and be tracked, track, and
rankings document results
• Case histories
• Value calculators • Evidence of post sale impact is
• Data collected in customers’ highly valuable intellectual property
premises • Collect data from customer sites
• Benefit guarantees and develop relationships while
doing so
• Reference accounts and data for
quantified points of difference


Moment of truth

• Define the compelling value proposition for your
business
– Identify your (a) Customer and (b) Partner Value Props
• Write them down
• Be brutal: at most 2-3 points each
– Present your value prop back to the group here.
• 5 minutes MAX


References

• Anderson, J.C., Narus, J.A. & Van Rossum,
W. (2006) Customer value propositions in business
markets. Harvard Business Review.


Day 2 takeaways
October 26, 2011

Tony Bailetti


Day 2 takeaways


Lead to Win Sales Funnel Mapping

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