The first customer reference
Doctoral thesis (monograph)
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AbstractMarketing and sales have generally been recognized as typical bottlenecks for start-up technology companies which produce complex products for corporate customers. Start-up technology companies often need a customer reference to support their efforts in entering the market. Without a real-world assessment that the first customer reference represents, it is difficult to convince the next potential customer to buy. The first customer reference, the topic of this study, has not been widely considered in the literature. Therefore, in order to close this research gap, a conceptual sub-study is conducted by employing a domain modeling technique to identify several closely related concepts. The identified concepts are investigated further by means of a literature study. New concepts are defined and based on these a descriptive model is created to increase the understanding of the problem domain. This also assists in early detection of factors for further sub-studies. This study conducts a multiple case sub-study, a survey sub-study with statistical analyses and a single longitudinal case sub-study including a triangulation sub-study of the previous three empirical sub-studies. Both method triangulation and theory triangulation are used. Field data was collected by means of semi-structured interviews and a survey. In total, 36 Thai software companies were interviewed in order to collect information relating to their first customer reference cases. The data was analyzed by using an inductive multiple case study method supported with a survey method including statistical analyses and a single longitudinal case study method. The inductive multiple case study method was used to identify the key variables and to create a basic descriptive framework. The statistical analyses were conducted to study the importance of each variable and to test how well the variables explain the growth of the companies. The single longitudinal case study method was intended to anchor the results of the previous studies to a real business case. Finally, based on the analyses, a predictive model is proposed. A secondary sample from a different business landscape was employed to gain a deeper understanding of the phenomena and to explore how broadly the results from the primary sample could be generalized. The results of this study increase the understanding of how start-up companies which produce complex products for corporate customers can capitalize on the market potential with the aid of a first customer reference. Based on the analyses the five variables contributing to the successful market entry of start-up technology companies were identified. Accordingly (1) a start-up technology company shares the costs of the first implementation with the first reference customer; (2) it uses the first customer reference for learning experimental knowledge in order to formulate the sales and marketing arguments and (3) it does not use the first customer reference for learning the correct technology; (4) its first reference customer operates in a key industrial sector of the country; and (5) in addition, the educational background of the entrepreneur is an important contributor to successful market entry. The single longitudinal case sub-study, including three embedded customer cases, illustrates how the variables form the pre-predicates and post-predicates for an iterative market entry. This study reports that only in a few cases the start-up technology companies had employed a customer reference to support their sales effort. Thus, a constructive sub-study was conducted in order to create a construction of how a customer reference could be used to produce marketing material. The construction was created based on the results of this study and on the literature review. Finally, the construction was tested with empirical data. Because of the encouraging outcome of the sub-study, further constructive studies are proposed in order to support the market entries of start-up technology companies in practice. This study is not the only study in the discipline of high technology and entrepreneurship in Thailand, but it is probably among the largest studies with multiple sub-studies and methods, although the sample size of the study was limited. This study has opened the doors for larger studies in the discipline in question, at least in Thailand, but likely also in other Southeast Asian countries. A major part of present entrepreneurship studies has been done either in the USA or Europe but relatively scantly in Southeast Asia. In the published articles related to this study and accordingly in this study, several research methods have been applied, which have not been used or have been used scarcely in the present research discipline. The research methods are the domain modeling, which is used for conceptual modeling in knowledge engineering; theory triangulation of the studies, which is used for increasing internal validity of results; and the constructive research approach, which is used for bringing research results into practice. Therefore, this study is a pioneer study in developing and in adopting methods used mainly by the other research disciplines. The phenomenon studied by the present author has previously been scantly investigated, thus making this study unique. The results and methods are available through this research report and also through published articles for scholars, practitioners and a larger audience.
high technology market, start-up technology company, reference customer