Effective Presentations

Some of my earlier posts have touched on the art of presentations and how I have been working hard on improving my presentation skills - oral and written. On the written side, I have discovered how less is more - Less slides, less text and numbers. As a reforming lawyer this less slides and less writing is strongly against my training. Instinctively, I want to create a detailed argument that creates a complete story - the more details, the more real and understandable my argument becomes. Of course for a presentation, this is completely wrong. A human mind can only absorb so much of a visual presentation (Check out my other post on this topic). Visual is the key word; a wealth of text or numbers on a slide just overwhelms the majority of human minds.
This doesn't mean you can't create slide decks with detailed information. You just can't use it as a presentation. Keep your presentation to the point - Intro, The point of your presentation (or why it is in their interest to listen for the next 10 minutes), key supporting reasons (just high level points), Conclusion. Use your detailed presentation as a supporting document given to your audience after the presentation.
Keeping in the theme of more visual - less reading, marketing guru Seth Godin has a very interesting article about the use of charts in presentations. Again, a person like myself thinks if I actually get a visual representation of data in my presentation, my work is done. Seth shows that this is not the case and that it can be made much more effective if you take the time to dig into what is the true point that the chart is trying to convey. You can find the article here.

Managing the Product Life Cycle

Over the past few weeks at my internship, I have come to appreciate some of the things that THQ does exceptionally well. One of these is managing the tail end of the product life cycle.
Too often video game marketing is all about creating the big splash. How do we generate consumer buzz and awareness leading up to the game's release? While this is incredibly important part of the marketing plan, the area that is oft forgotten is the "how do we generate bonus sales after the release period (the 3-6 month window after the release)?" That is why you often see the sales graph for video games having three distinct stages - 1) the bulk of the sales occur very early; 2) a dramatic drop; and 3) trickle of sales for a period.

THQ (especially THQ kids) is masterful at stage 3. Looking at their sales graph, you see a series of peaks scattered through the 3rd stage where minor marketing strategies deliver increased sales and solid returns for the added expenditures.

Let's look at the example of EA's Harry Potter: Goblet of Fire compared to THQ's Cars. It is safe to say that both of these franchises are popular, but I think it is fair to say Harry is more popular. The Cars video game received a slightly higher rating than Harry (gameranking.com has it at 71% to 68%). Overall, I say its a push and these games should perform equally well. Let's see...

The graph below details their monthly unit sales after their release (data taken from NPD). You can see they both start pretty strong then drop off (Harry's first peak is higher than Cars). But look at how they perform after month 6! Harry levels to around 10,000 units per month and slowly declines to zero. Cars declines; then around Christmas it shoots up to a point even higher than the initial release; then it declines to a level just above Harry's sales; and it even experiences another small peak around a year after the initial release. The final results are clear. Despite having a superior brand and being on the market for an additional 6 months, Cars has outsold Harry Potter by a ratio of 2:1.



Now, admittedly the Harry Potter game was critically reviewed as lesser than the Cars game. And we could argue that because Harry Potter was released in November, it could not take advantage of a Christmas bump 6 months after release, but does that really explain the 2:1 margin in unit sales? I argue that it doesn't. I think it demonstrates THQ's understanding that video game sales go on beyond 6 months from release and a marketing strategy that accounts for these opportunities beyond a simple price cut can reap big rewards.

Tech Coast Angels Screening Event

This past Wednesday, myself and two other members of the VCIC team were generously invited to watch a Tech Coast Angels (TCA) screening event. At the event, 4 young companies present before some of the members making the case about why they should receive angel investment funding.

The event is a great opportunity to see how experienced investors grill entrepreneurs. For obvious reasons, I won't go into any detail about the presenting companies, but the four were from very diverse backgrounds. It was interesting to see the presentations from the investors perspective; learning what works and what doesn't.

After watching the event I have a few preliminary tips for entrepreneurs seeking investment. First, answer each question as directly as possible. There seems to be two reasons entrepreneurs do not answer the question they are asked: 1) they want to dance around the issue; and 2) they misunderstand the question. In the first case, the entrepreneur is not fooling anyone. These investors have "been there -done that" and, even if he should fool them, there will be due diligence later on that will catch up with him. IMO, the second case may be worse because if the investor asks a question and the entrepreneur answer addresses something else, that is bad. If the investor cuts him off and brings him back to the initial question and the entrepreneur still answers something else, it can be an indicator that the entrepreneur can't focus on the issue at hand. How can an investor be confident that when a issue arises in the company that the entrepreneur will cut to the heart of the matter and address it if he can't answer a direct question?

Second, have a plan and understand your weaknesses. The worse thing an entrepreneur can do is to fluff up the weak areas. The investors will see them and if he continues to assert it will not be a problem, you will lose all credibility. There is no shame to say that you need help in an area and make that part of your plan for use of the investment funding.

Finally, really think if you need angel funding. While we all want to believe our business is design for hyper growth and greatness, some businesses are not meant for the angel/VC route. Once you go this route, an angel or VC will demand a hockey stick-like growth curve and an exit in a very short time frame. An entrepreneur must understand if the market of his business can accommodate that growth or that exit time-frame. Some markets are designed for slower growth. There is nothing wrong with that. In fact, it will lend itself to growing itself through revenues and thus avoiding the need to dilute equity to the outside investors. The main point is that if the market will not deliver the growth rate or exit time-frame, the entrepreneur will soon find himself with some upset partners and he could find himself removed from the company.