Many large technology companies are usually known by one product, out of many in their solution offerings. And that one specific product is typically their best product. Also, most times, the product is what gave them the new basis upon which they competed and became successful.  When they were startups, that product provided the elements that enabled market disruption or simply facilitated the capacity to take market share from incumbents. Also, in some cases, that product engineered their pioneering of a new technology category. It does not have to be the first product of the company, but most times, it is always the one that everyone comes to associate with the firm, over time.

Apple is an iPhone company, Google is a search advertising business, and Facebook does its social connection. The old HP was a printer company and Amazon of today remains an e-commerce business, despite the Alexa (voice assistant), Echo (speaker),and  Whole Foods (grocery chain). While Google makes most of its revenue from advertising, Amazon generates most of its market capitalization due to its e-commerce operation even though it may be losing money on ecommerce. Yes, the Amazon ecommerce is a loss-making business but which is a very critical anchor of Amazon’s home run on market capaitalization.

At the end, Wall Street will push the stock upwards because the metrics for valuations are convoluted. Google parent company, Alphabet, made $7.8 billion profit on $27.8 billion quarterly revenue, largely from advertising. Google remains an advertising firm and that is what matters. Apple will remain an iPhone company and that is why iPhone X matters to Apple. Yet, at the same time Google was bringing billions in profit through its one-product company (search), Amazon had only $256 million profit on $43.7 billion in revenue. Yet, the markets cheered as Amazon beat analyst expectations. Now you know why staging expectations is more important than the actual results!

So, for all the leading technology companies globally, there is always the one product that defines that company. That one product is the best product that helps the company to drive growth. Sure, these companies are expanding and branching into new areas to create diversification, but when the quarterly statements are released, you will notice that the other things are simply to keep investors at peace. Go deeper into the financials; you will notice that nothing is really happening in those other products.

Very brilliant companies design their businesses so that new products serve that one product, at least initially. In other words, even when you diversify, you make sure that everything you do drive the success of that one product. That means that the one product is the first customer to the new products which are launched to drive diversification.

Let me give an example to explain: when Amazon built its cloud computing service, the first customer to that service was Amazon ecommerce operation which needed such capacities to deliver the best possible user experience. So, with that readily available customer, the cloud service had a reliable customer. Then, over time, the cloud solution was made public as a service: the Amazon Web Services. Today, it is the driving force to Amazon’s profitability.

Growing with One Product

Amazon wants growth and it moves into new markets with its best product: ecommerce operation. With that key product, it introduces new solutions, most especially the Amazon Web Services, to new markets. So, as Amazon pursues its market domination, it relies on its one product to drive it. The messaging to the world and media remains that Amazon is an ecommerce company. But when you look critically, Amazon does many other things. But that image is central to its ability to manage its messaging. That is something you must learn in your business: you must be known for something and let it be your best product.

Besides, when technology companies struggle as a result of competition, what usually happens is that the one product has been attacked. And when they need to overcome the stasis, they need to find another product. The old IBM was known for its computers but that was severely wounded by Dell and others. IBM is reinventing itself with a combination of AI powered by Watson. HP, the printer business, is looking for a new product for an edge in technology services.

Note that it does not mean that the company must have one product. What happens is that most times, it is one product that defines how we view most technology companies. SnapChat remains known for its disappearing posts despite efforts to diversify into hardware. We know that Microsoft will remain a Windows business despite anything it is doing with HoloLens and cloud computing. At any phase, we have a one-product company in most technology businesses. They always work for growths around that one product.

One-Product Amazon

Amazon is a great company that uses its main product (the ecommerce) to keep the expectations of investors low, but uses other products to turn quarterly surprises.  So, everyone expects losses, but with cloud and other services, Amazon comes up with small profit, and when that happens, markets rejoice. That has been the driver of the market valuation of Amazon. It is only Amazon that will make $256 million profit on $43.7 billion quarterly revenue without being punished by markets. For any other company, investors will shout that costs must be cut to improve the profitability. But Amazon understands one thing: ecommerce can deliver the huge revenue, even at losses, and investors will be fine, provided there is something that will flip those losses into profit.

Amazon is large and it is also efficient. I do think that it has no rival in its operational excellence. The way it does everything today is peerless. This company has been good in seizing the moments. Examples abound:

• It has superb marketing stunts where American cities competed for the opportunity to host Amazon second headquarters as though they were auditioning for American Idol, a singing competition. That stunt made Amazon more local as the news were everywhere in America. That was free publicity and marketing at scale. The message was an ecommerce company was coming into town.
• Few years ago, 60 Minutes, a TV program hosted on CBS, profiled Amazon’s drone distribution project, providing massive earned media. That was a technology that was not even ready but Amazon was able to inject itself into the most elite TV program in America as shopping season was about to start. The stage of this drone was the best product, ecommerce, and its efficiency.
• Another brilliant messaging by Amazon was tying its best product (the ecommerce business) with its low pricing and the quality of Whole Foods, a high quality grocery chain. For most Americans, the message they got was that Amazon was going to offer them the best possible grocery at the lowest price possible. Amazon took that home when it announced massive cuts that were largely marginal. Nothing of value really happened in the cuts but Amazon wanted some unbelievers to believe that the grocery chain, nicknamed Whole Paycheck because of its expensive products, is now affordable.

All Together

Every company must discover its one product and build its image around it. Using that one product, marketing and customer acquisition could be more impactful. Also, as the company diversifies, it is also critical to see how the one product can tax those new areas or products. In other words, you need to make the one product the first customer of new products. Doing that reduces investment risks and ensures that as funds are invested in new products, there will be positive impacts in the one product, even before the new products can make real financial contributions.

Nice Comment from a LinkedIn User

And Fasmicro – Zenvus, Interswitch – ATM; you can add your own. Perhaps deliberately or accidentally, the idea is to rally support and have a flagship product. It may not necessarily be the first product launched by the company, but somehow the lot is bestowed on one of the ‘shining’ products of the company. Just as P & G and Pampers are one and the same. Again it’s difficult for any company to do extremely well in all its products categories; so there will always be those ‘also run’, the ‘buy one and get one free’ families.

It was lyrics for the ages. The Fugees, an American hip hop group in early 1990s, recorded the masterpiece which connected lovers around the world. The beginnings of the lines were like pains, but the whole meaning of the stanza is a breeze.

Strumming my pain with his fingers
Singing my life with his words
Killing me softly with his song
Killing me softly with his song
Telling my whole life with his words
Killing me softly with his song

Across campuses, pubs and joints, the story was the same: someone was killing someone, softly. Of course, if someone is killing someone, even softly, it was a trajectory of doom. But waiting a little longer to finish the line, the dimples would broaden, and the eyes would roll. It was not really a death path, but an ephemeral passion of humanity where words weaken, but in ecstasy.

Take it all together, it is a breeze: “a light gentle wind” which is harmless but from afar may be mistaken to be painful. Apple is having a breeze. Yes, the breeze is blowing and Apple is certainly going to enjoy. But those not closely entwined in the Apple business may mistake it as a storm.

The iPhone X pre-orders begin in earnest. It is a more expensive product, with its expensive face-scanning capabilities. It is expected to be in short supply. And will replace the highly lackluster iPhone 8 which has struggled to leave shelves since it was unveiled.

The Apple Staging

Simply, Apple used iPhone8 as a forerunner to iPhone X by making it clear that iPhone X is superior. That makes it obvious that Apple has innovated, creating a new marketing tool with a feature which is not available in any other phone. Apple shortened the launch gap, knowing full well that iPhone 8 will struggle under the shadows of iPhone X for a fashonista brand. In other words, Apple never gave iPhone 8 any opportunity to succeed in its luxury brand. People that buy for luxury cannot invest money on a product which has a sequel on the day of its launch, especially when that sequel is coming in weeks. It makes no sense; so the wait for iPhone X, by Apple global fans, making it impossible to sell iPhone 8.

Apple Inc.’s iPhone 8 posted the weakest sales of any of the company’s new smartphones in recent years, according to estimates by two market-research firms, raising the stakes for the higher-priced iPhone X as advance orders start on Friday.

In the U.S., Apple’s largest market, the iPhone 8 and its larger 8 Plus version accounted for 16% of all iPhone sales in the September quarter, according to Consumer Intelligence Research Partners LLC

From afar, you may think it is a tempest, by looking at the beginning of the line, as iPhone 8 could not move from the shelves. But if you finish the stanza, it is a breeze, for Apple, because iPhone X will do well. Without the iPhone 8, the iPhone X will not be long-awaited. Now, it is heralded because its predecessor was for cavemen (and women) before it was even shipped from factories. In the minds of Apple fans, Apple has further created an element of supreme value in iPhone X.  That is what you want in a product.

Here are things to note:

• Apple has been leaking how hard it was to create the 3-D sensor. When you read that, what comes to mind is obvious: only the very best could have solved that specific 3-D problem, and Apple did that in iPhone. Oh yes, the believers will continue to expand.
• The media people have been writing how hard it was for the vendors to meet Apple targets. Simply, the fans will appreciate all the efforts everyone is putting to make the best phone, ever.
• The media world has been saying that Apple will produce iPhone X in limited quantity. If you are a fan and hear or read that, the best strategy is to simply go out and take action. And that means pre-order before Apple decides to phase out production, after completing pre-orders!
• Apple opens a pre-order system for iPhone X which means if you want this product, you need to go right away and pre-order. That creates a new level of demand since not many people will get it at the same time. When you do that for a luxury product, the product becomes more luxurious. Simply, Apple has a stage and it is playing it.

All Together

Apple has set the stage for iPhone X and it will be the best selling electronics product of all time. Apple created a breeze, never a storm, despite what some may think. The company knew what it was doing. The struggle of the iPhone 8 may appear to be a pain, financially, but when you finish the stanza of the quarter, you will see glory. Apple excels in that. The iPhone 8 is another genius strategy to launch something ahead (the iPhone X) that will delight a fashonista’s Apple world.

At the end, Wall Street will push the stock upwards because the metrics for valuations are convoluted. Google parent company, Alphabet, made $7.8 billion profit on $27.8 billion quarterly revenue, largely from advertising. Google remains an advertising firm and that is what matters. Apple will remain an iPhone company and that is why iPhone X matters to Apple. Yet, at the same time Google was bringing billions in profit through its one-product company (search), Amazon had only $256 million profit on $43.7 billion in revenue. Yet, the markets cheered as Amazon beat analyst expectations. Now you know why staging expectations is more important than the actual results!

Tips, all-in-one iPhone manager for you to manage your iPhone X photos, videos, songs, contacts, iBooks, voice memos and other important data.

I just accepted to keynote NIGERCON 2017 which is being organized by IEEE (Institute of Electrical and Electronics Engineers) Nigeria Section at the prestigious campus of the Federal University of Technology Owerri (Nigeria), my alma mater. Yes, it will be in FUTO where the finest Nigerian engineers are trained (lol). IEEE is the largest technical association in the world with membership in excess of 420,000.

IEEE Nigeria Section invites you to participate in the upcoming IEEE NIGERCON 2017. NIGERCON is a refereed international conference. The Conference seeks submissions of articles from Academia, Government, Industry, and Private Sectors on the following sub-themes: Engineering Education, Computing, Communication, Power and Energy, Internet of Everything, Engineering in Medicine and related fields.

The theme of the conference is “Electro-Technology for National Development” and it is scheduled for November 7-10 2017.

Date: 7-10 November 2017
Theme: Electro-Technology for National Development
Venue: Federal University of Technology, Owerri (FUTO), Imo State, Nigeria

I will deliver the plenary keynote and then run a workshop on artificial intelligence with applications in agriculture and active cybersecurity defense.  I will share more on the presentations later here on Tekedia.

Please I want you to attend. Register here. Support our schools, students and professors.

Come and let us have a technical festival by looking at atoms, electrons and data, and how we can combine them for national development. Because the venue is FUTO, you can count on the peerless quality of this conference.

We want to raise capital for our businesses to help us with resources to fix frictions in markets. In this video, I explain how founders can boost the valuations of their startups. The key element is that you must have a way to communicate why you are different from the incumbents because your ability to set a new basis of competition will unlock more value for your investors. It connects into the heart of your scalable advantage, providing new elements that set you apart. High scalable advantage means that you can grow with minimal costs, and most times, that happens because your marginal cost is very low. If that happens, investors will see your business from new angles, rewarding you with higher valuations. Cases abound with the following:

• Airbnb and hotels: Airbnb has practically no marginal cost compared to hotels
• Uber and traditional cabs: Uber is an aggregator with strong scalable advantage
• Facebook and media: Facebook does not create the raw materials of its business. Users do and that means it can grow without any limitation, theoretically
• WeWork and office leasing firms: WeWork is an aggregator with service, removing a pain point of dealing with landlords who remain stuck in the past.

But even with the promise of high valuation, you need to generate income because in realty that is what investors are investing in for. In other words, after all the nice sounding words, you must make profits; otherwise, the business will die one day. Sure, if you sell before going public, the acquirer will still have to deal with generating profit to make it a business.

Many years ago, in secondary school, I read a book titled “This is our Chance”. It was authored by James Henshaw. The play was about the battle between tradition and modernity and how to assimilate the best of both African and Western cultures. James set the stage with Kudaro (the Crown Princess), her father (Chief Damba), her mother (Ansa) and others. It was all about balance and hybridization in ways of living.

Today in Nigeria, in the technology world, we are doing relatively well in the software sector. We are making apps which are helping to reduce frictions in the lives of citizens and operations of companies. With 93 million mobile internet subscribers, according to the latest data from the Nigerian Communications Commission (NCC), the trajectory is very promising.

But while we are pushing, making the best efforts in apps and software, our hardware capabilities remain stunted. Unfortunately, most of the opportunities are in the physical domains. There needs to be physical elements which the software must drive to further simplify the lives of people and operations of companies. Without that interface, using the software skills to build hardware solutions for agriculture, energy, transportation, communications, and other sectors, we will not realize the full benefits that cloud, mobile, AI (artificial intelligence) and IoT (internet of things) are enabling.

As African entrepreneurs wait, global technology companies like GE are pushing that boundary of building this interface. GE calls it the Industrial Internet and it sees it as a catalyst to “leapfrog competition and establish the continent as an industrial powerhouse”.

In an increasingly connected industrial ecosystem, a staggering amount of data is being generated every moment. Commonly termed ‘Industrial Internet’, it involves connecting software, industrial applications and intelligent analytics to businesses, enabling unprecedented gains in productivity and innovation from these massive datasets. Leveraged effectively, this paradigm shift in industrial thinking will allow African companies to leapfrog competition and establish the continent as an industrial powerhouse. However, this requires a new generation of talent with a strong technical foundation in big-data analytics, machine learning and web application development, as well as the business acumen to translate technological improvements into business results. (Source: GE Newsletter)

But it is not just GE; Vodacom is building amalgam of solutions especially in the telecommunication sector, deploying IoT systems to support commerce in Nigeria.

With the Internet of Things (IoT) gradually gaining momentum globally, the need for Nigeria to tap into the global technology hub has been stressed. IoT has delivered a big growth opportunity for the telecoms industry due to the volume of connections expected and experts have projected the market will reach $14.6 trillion global market size by 2020. In this regard, Vodacom Business Nigeria, a Tier 2 operator, said it has become highly essential for Nigeria to seize the vast opportunities that this growth presents in transforming businesses in the country.

[…]

Kolade in his presentation, called on telecom operators to adapt to the changing times and source other revenue streams to replace what is being lost in the continuing revolution of communications.

“The Internet of Things offers significant growth potential and the opportunity to take a role in new vertical markets, such as automotive, healthcare and smart cities. As these sectors seek to adopt more IoT services, the opportunities that exist are vast. Whether you are a hardware manufacturer or connectivity reseller, adding IoT solutions to your portfolio will open up new revenue streams from selling hardware, software.

Simply, if Vodacom connects all these elements, physically, it can impose taxes on them, for startups and entrepreneurs to use them. Our capacity to improve healthcare in Nigeria will not end in making good software. We must find ways to create hardware solutions which those caring for patients will use.

The Hardware Paralysis

The global hardware companies in Africa are not wired for startups. That creates problems for entrepreneurs to engage on their platforms. Unlike Google which is training thousands of people, impacting digital skills, none exists at the same scale for hardware makers. Yes, we have GE Garage and Samsung Academy, but those are largely constrained by their respective technologies. What they do is great, but the scale is minimal. It is easier to find opportunities in the web ecosystem than the hardware domains. Of course, it is cheaper in the web because with laptop and Internet connection, you have all the tools required to make things happen. Hardware will require expensive tools which do not necessarily come easily.

Besides, for you to make great hardware products, you must be a good software developer first. That means hardware requires many components beyond coding. Writing device drivers and connecting them to embedded electronics will not happen by trial and error. There is no brute force methodology in hardware: it is either you understand the signal and the pin, or you will run out of luck. It is a challenging endeavor for most entrepreneurs. Unfortunately, that is where the opportunities reside and African entrepreneurs must go for them. Hardware will bring higher level of local differentiation in more competitive ways than any software company can ever enjoy. While Instagram can launch and add features to support Nigeria, an American solar company may not optimally create solar power systems that will efficiently solve customer needs without being local. So, the fact that they cannot solve local needs without being local is an opportunity for local entrepreneurs to make differentiated products for the markets.

But even with that, the foreign firms are moving heavily into local terrians. MasterCard is a payment juggernaut which has expanded beyond the typical software-centricity of web payment into using hardware solutions to further permeate the African market. The implication is that it will become a key foundational architecture upon which African payment solutions will run, offline and online.

• The Biometric Card: Building on its pioneering work to leverage biometric technology for online payments, this year we unveiled a next generation payment card in South Africa that uses your thumb or fingerprint to authenticate purchases you make in physical retail environments.

• Commerce for Every Device: The IoT has given every connected device the opportunity to become a payment device. Our payment technology is embedded in, among other things, fitness bands, gas pumps, vending machines, smart mirrors in dressing rooms, cars, shared workspaces such as WeWork and Softbank robots, like Pepper.

All Together

From my experience in Zenvus, my pioneering precision farming technology, one can make real impacts in the lives of the citizens when hardware brings the best in software engineering. Companies like Amazon have noticed that the next phase of growth will come by using the best possible software to connect physical homes, offices and the world. According to PWC, “Amazon has displaced Volkswagen as the world’s biggest corporate investor, according to research by PwC. Its R&D spending rose to $16.1 billion in 2017 from $12.5 billion a year earlier. VW slipped to fifth (not helped by exchange rate effects), behind Alphabet, Intel and Samsung.”  Most of that Amazon investment is going into Alexa, Echo, and other hardware systems it is launching constantly.

Africa is well positioned because we have great computers in our pockets. Yet, we will miss massive opportunities to use these devices as tools to improve healthcare, agriculture, education and other sectors, if all we do stop at software. Yes, we need to extend beyond just making software to actually building physical things, using the software to make them smarter. That is the great opportunity which is arising in Africa today, and it will be monetized, at scale.

Nigeria, China, India, Indonesia and Pakistan are markets that will account for more than 40 per cent of the 1.6 billion new smartphone connections by 2020. This is according to the Global system for Mobile Communications (GSMA). Currently, Nigeria’s smartphone penetration as at 2016 stood at 30 per cent, but there has been more adoption, especially as new and cheaper devices are entering the market, almost on a monthly basis.

As Mr Henshaw noted, the mix of African and Western cultures can co-habit. Our software and hardware startups must find ways to collaborate so that our software can help build physical things which will help seed opportunities and solve real-world problems in African cities. While electricity availability tracking apps could be fun, the real value will be finding how to make hardware solutions that can provide electricity. That could be solar solutions with totally African-engineered design framework in metering, payment and maintenance. The same goes for other sectors. We cannot make such leaps if we just focus on coding for virtual ephemeral experiences without thinking how the codes can move physical atoms in the lives of people and companies they build in Nigeria and Africa.