Expanding on The Bowling Pin Model
What is The Bowling Pin Model?
It will come as no surprise that I'm a fan of the work of Geoffrey Moore, as I've named-dropped him more than corporate execs drop the word "synergy" in meetings no-one asked for. As you may or may not know, he employs a model known as the "bowling pin model". It's used to visualize how you might move from a first niche market to a next one to provide a strategic roadmap of sorts. More importantly, it illustrates how choosing your first "beachhead market” needs to be positioned well in order to topple consecutive markets more easily. Simply put: you might conquer an island easily, but that doesn’t make it easier to conquer the next island, let alone the mainland.
Geoffrey Moore’s Bowling Pin Model
The concept hinges on two principles:
Market Expansion: Similar products for different customers. This is when you create new versions of your existing product to address new types of customers. You’re effectively expanding the playing field in which you are serving customers but are sticking to the same tech.
This enables you economies of scope, meaning you can leverage your existing technology and manufacturing knowledge when creating new products and even re-use (sub)systems and components across product lines.
Market Penetration: Different products for similar customers. This is when you create entirely new types of product to better serve your existing customers. You’re getting more out of your existing market segment and are digging deeper, hence penetrating your market segment further and gaining a stronger foothold in your customer’s lives.
This enables you economies of scale where you leverage and existing customer base. The market you can sell to already exists and is easily accessible as you’ve already sold to them. This makes it so you can go for scale much quicker and cut down on unit costs of your hardware products sooner, possibly even skipping an MVP step.
Dig deep or make a lateral move
In any case, describing your market as "X for Y " works best, where each of them is a movement axis in the model (either products or customers).
How it works
Let's use GoPro as an example:
Their initial market was "POV action cams for extreme sports" for which they're best known. However, over time they moved into "areal footage drones for extreme sports". This moves them along the "product" axis, because let's be honest: developing a drone is something completely different than a camera.
After that they moved into "lifestyle apparel for extreme sports" with equipment bags, but also travel bags and backpacks, starting to compete with completely different brands in that space. Encountering new companies as competitors that weren’t before is a telltale sign you’ve moved around in the model.
Moving along the Product Axis
While GoPro also made moves in the customer axis — where they started focusing on Hollywood professionals for shooting close-up action — it's not distinct enough for the purpose of this example (and therein lies one of the Model’s problems, but let’s hold out on that for later). So I'd like to use another example, building on top of that of the drone.
DJI is a well known company that was making drones for entertainment purposes and professional videographers, but they've chosen to remain within their product axis and instead make move in the customers axis.
As such they've moved into the agricultural markets: providing drones for crop dusting and inspection, they've also move into security markets, events space, … and the list goes on.
Moving along the Customer Axis
At this point you can start to see how such a roadmap would develop. You could try to combine two moves at once, where you switch both your product and the customers you're serving, but that's the same as starting all over again.
It's not on-brand (which will confuse existing customers), you'll have no inroads to the new market (since you can't leverage your existing user base) and you can't leverage your institutionalized product knowledge either. Put differently: you have no economies of scale or scope to move into this new market. That's why it makes sense to always follow the flow of the model and not try to "puddle jump”.
Most companies tend to stay within a lane and only make moves in a single direction, but moving in both directions at different times can create interesting new opportunities where you can leverage the customer base from one and and the product knowledge and capabilities from the other to enter a new space.
Let's imagine GoPro & DJI where the same company, then they could combine their apparel and agricultural market into making apparel for farmers, bags for their equipment, etc… Since they already have the customer base and distribution in place on one end, but also the manufacturing facilities and capabilities on the other end. Again resulting in economies of scale and scope.
Where it breaks down
Now, while this is an excellent model, it kind of breaks down at the granular level where most start-ups sit. I've always struggled with lining it up nicely with the “Smallest Viable Audience” model I thoroughly believe in. At first glance it would seem that your first market or "point of attack" is simply your SVA and you move further from there. But those moves always feel too large and too early when compared to what typically happens in reality.
Now, my focus is consumer hardware, and that's where one of the problems lie. The bowling pin model works in conjunction with the product adoption curve which you’ve definitely seen before.
The marketer’s “live-laugh-love”
But both the bowling pin and the curve models are built upon B2B (typically software) product behaviors. Especially the curve model has been done to death by smartass marketers trying to apply it to B2C products: it simply doesn't work. They even taught it at industrial design school without making this clear distinction, but as a result everyone, thinks it does.
Some of the principles definitely make sense and hold up, especially when listing defining characteristics of your SVA, it's very similar to that of "early adopters" and "beachhead markets". But I digress.
For B2C, Moore has a 4 Gears Models he uses instead of the curve model, that if you read up on it will sound very familiar, since it's been the basic playbook of every new software service of the last couple of decades. Again: a lot of this can be (re)used on consumer hardware, but it remains specifically focused on software in my experience and doesn’t exactly work one-on-one.
How to fix it for consumer hardware
Coming back to the bowling pins, I'd like to expand on this model to make it work better for consumer hardware, so far this has served me well and seems to hold up nicely.
First, I'd like to add a granular level within the "point of attack" market, wherein you focus on your SVA and recognize it as a "niche within a niche" of sorts. I like to make the distinction here where your SVA is our "target market" and your point of attack your "market segment" or even better your "collateral market". Why collateral? I'm again referring to a wonderful quote of Blair Enns: "The target is what you aim for, the market is what you hit".
Bringing me to my second point where I would like to add this descriptor, specifically for expansion within your collateral market:
Market Maturing: Similar products for similar customers. This is where you remain within the realm of your product type, but create expansions on your current offering to better service the collateral market after you've seen some unexpected (new) users of your product outside of your targeted SVA.
This when you’re making a conscious and concerted effort to address the needs of customers that until then have been outside the scope of your SVA through product revisions and accessory development.
Let's use the GoPro example once more to explain:
The point of attack, to which I'll now refer to as the Market Segment or the Collateral Market, is in this case "Action Cameras for Extreme Sports"
The founder of GoPro, Nick Woodman, is an avid surfer and in first instance wanted to solve the problem of capturing POV footage while surfing. The very first GoPro was aimed at solving for this very narrow niche of surfers. What helped immensely is the fact that Nick was a surfer himself, providing a great "founder-market fit" allowing him to be deeply embedded in his target audience and understanding their needs very well while having access to a lot of other users in the community. On our updated model including the SVA, it would look something like this:
Point of Attack is a subset within the market segment
The first GoPro was a brilliant MVP: instead of developing a waterproof action cam from scratch, Nick sought out an existing manufacturer of compact video cameras, the OEM allowed for white-labelling and Nick simply ordered a couple hundred and could choose the colors and the logo. He then focused on developing a waterproof casing and a wrist strap on which to mount the camera, greatly reducing development costs and risk. An excellent MVP for his SVA.
MVP’d like a boss
But what started to happen, was that the camera was quickly being adopted by other disciplines within extreme sports like snowboarders, mountain bikers, moto crossers, … The beauty of the surfers was that they typically also practice other extreme sports disciplines, allowing the product to "contaminate" other markets quickly.
The target is what you aim for, the market is what you hit
The following years, GoPro mainly expanded on it's accessories, improved on their cameras, offered different models, … all to better and more precisely serve the other niches related to surfing and extreme sports. This type of Market Maturing typically happens in the form of developing new accessories or upgrading of hardware and software of the same product (your classic V2 stuff).
A conscious effort to address (originally) unexpected customer needs
The more mature these product lines become, the more the innovation becomes incremental, typically even leading to a "generification" of the core product where it does start to include more features to address multiple markets at once, but only once the company has achieved the scale necessary to do so profitably. (Read more on the dangers of doing this too soon in Think Small: The Power of a Smallest Viable Audience)
If it sounds like a bowling pin model within a bowling model, that's because it kind of is: Moore's theories still hold up, there has just been added some more nuance and definition and makes the steps smaller and less daunting.
Moving towards a “do-all” product family when maturing the market
Looking at growth and roadmaps like this creates multiple discoveries of opportunities and insights for a bigger move into a completely new market on the "higher level" (the original bowling pin model) at any given time. It should be noted that that the three types of moves (penetration, expansion and maturing) almost always happen non-linear and in parallel at different points in time. But when you feel you're making a move in the "higher level" of the model, I would always go back to employing the SVA tactics, because you are no longer maturing a product line, but building a new one.
So if you’re thinking about taking the next step in your roadmap: identify what it is you’re doing (penetration/expansion vs. maturing) so you can act accordingly and employ the right tactics.
