Emerging tech biz CMO markets big for nanotechnology

December 15, 2004

BY MICHAEL KRAUSS

Who: Konarka Technologies Inc., a Lowell, Mass.-based company that makes products using nanotechnology, a branch of engineering that works with things tinier than 100 nanometers (that’s 1/100,000th the diameter of a human hair).

What: Pay attention, all you b-to-b marketers—Konarka sets the standard for selling its products based on benefits, not just a recitation of features.

“People don’t buy technology,” says Daniel McGahn, Konarka’s executive vice president and chief marketing officer. “They buy what it does for them. The role of marketing is to focus on the impact and what you actually do.”

How: Nationwide, a new technology gold rush is fueled by the belief that innovation at the molecular level can create everything from stain-resistant clothes to more effective sunscreens and even tiny microscopic machines that will repair our aging bodies. The federal government understands the opportunity: The president recently signed the 21st Century Nanotechnology Research and Development Act into law, authorizing expenditures of $3.7 billion on research supporting nanotech innovation.

What 4-year-old Konarka does is build products that convert light to energy that can be used just about anywhere. Unlike clunky solar cells, Konarka’s solar strips are thin and flexible. They look like a strip of 35mm photography film--except they are a mobile power source that for example, can easily coat a soldier’s tent providing a lightweight energy supply in the field.

McGahn believes his emphasis on product impact is essential when marketing disruptive technologies. “You can’t do primary research in the regular way,” he says. “If you did a business plan for the personal computer in the 1970s, they’d laugh at you. Who would have believed there really would be a computer on everyone’s desk?”

Sean Murdock, executive director of the New York-based NanoBusiness Alliance, the industry trade association, says, “If you look at Konarka, they’ve gotten to a tangible product quickly. They’re rolling out a solar cell targeted for use with portable electronic devices. There was a focus on getting to market quickly with a product with a good consumer value proposition,” he says.

“They know exactly where their sweet spot is and they stuck with it. They will gain a foothold and grow,” Murdock says.

In an emerging industry, McGahn is no novice. At age 33, the MIT graduate and consulting industry veteran is on his second nanotech start-up. In addition, the company boasts two Nobel Laureates on its board--Alan Heeger, winner of the Nobel Prize in Chemistry in 2000, and Arno Penzias, winner of the Nobel Prize in Physics in 1978. Howard Berke, the company founder, is on his 12th venture. And some of the biggest names in venture capital funded the company, including Draper Fisher Jurvetson, New Enterprise Associates and Vanguard Ventures Inc. Such corporate powerhouses as Siemens, ChevronTexaco Corp. and Eastman Chemical Co. are active investors and business partners.

But the key to Konarko’s marketing success is product descriptions such as these (from its Web site):

• Portable computers can be recharged with light, thanks to Konarka’s unique, photoactive materials.
• Konarka is developing portable, electric-generating buildings for the military.
• Konarka’s technology can be built into everyday products, such as a window awning, converting light to energy—anywhere.

Even Konarka’s business description emphasizes benefits to the customer: “Konarka is focused on the development and commercialization of photovoltaic materials that are lightweight, flexible and more versatile than previous generations of products.”

McGahn believes b-to-b marketers must be good storytellers. They have to translate complex technology into terms a 10-year-old can understand.

“You’ve got to be able to sell,” he adds. “You have to be able to understand your technology from a customer’s point of view. You also have to identify the right customer; it’s not anybody with a check.”

--Michael Krauss, Marketing News columnist