Beware of Golden Handcuffs

I once led marketing at a small public company with a product that had defined a new category and was the clear market leader. The company had landed a huge, globally known tentpole client early in the company’s history.

Our CEO had a brilliant vision to build on this initial success and define an entirely new market category - a suite made up of the initial product and a line of new products in adjacent markets. That was one of the key reasons that I joined. To build momentum and cement our thought leadership, we began to message this larger vision and successfully got industry analysts, thought leaders and major clients and prospects to get behind the idea. We successfully created a second and larger new category in the market.

The challenge was that our tentpole client for the first product accounted for a significant percentage of revenue. This client deployed our initial solution globally and had very high product evolution expectations, which were aligned with the initial product, not the suite of new solutions envisioned by the CEO. Each time we tried to invest product and market development resources toward this larger market, our revenue constraints of being beholden to the large client held us back.

Over time, the company was unable to quickly deliver the additional products/suite that aligned with the vision that we had championed and promoted. We maintained industry leadership in the initial category but could not capture the leadership mantle for the new larger category that we had created.

My takeaway was that the management team, sales, product development and marketing have to be completely aligned on the long term vision and stay focused on not becoming to dependent on any one customer, partner or market.