Happy New Year's Eve!!!

While the rest of the business world is writing "serious" blogs about 2008 predictions and such...

Here's to wishing you and your company the most prosperous year ever!!! (and all the pencils you could possibly want)

Merry Christmas Eve!

Yes, we know from the media and retail reporters that this has been a "ho-hum" Christmas as far as spending goes. However, I just didn't see it.

All of my shopping experiences this year were friendly, helpful, quick, and pretty darn painless. And, with the three days prior to Christmas accounting for as much as 15 percent of holiday sales, there's a lot of business left on the table. While the day after Black Friday starts off the season, the most intense sales volume comes in the few days before Christmas.

Here's wishing you a Merry Christmas and a toast to all the shopping days AFTER the 25th!

Online Alignment Enlightenment

Positioning is not what you do to a product... it's what you do in the mind of a prospect. A McKinsey global survey of marketers shows that companies are using digital tools- from Web sites to wikis- most extensively for customer service, but also for online advertising, pricing, and product development.

Marketers have begun to turn to social networks for insights into what consumers want, yet is this information accurate? Whether the customer researches through their social channels or whether they use a search engine may depend on the number of friends they have. The information present in those real or virtual connections is becoming a part of a customer's purchase-related activity. But, is harnessing the collective consciousness relevant to your company's bottom line? Is this information affecting everyday transactions?

Aligning your business to maximize connections employing reputation, identity, and trust are increasingly like to produce hard sales. Take the time to participate in and explore social networks that are relevant to your customer base.

Out of the Mouth of...

... my partner, James Ballard, http://www.ballardcreative.com/

"I've realized that I've become a big dude in a small space. I need to push myself into a bigger fish tank and swim like a Mother-F#(-%*r!"

Hmmm... not very eloquent, James, yet you're right on the money, honey.

Such an "Arrogant Bastard"

Having drinks with friends last night at the W and one of them ordered "Arrogant Bastard Ale" http://www.arrogantbastard.com/ I immediately proceeded to fall in love with this product. Not because of the liquid contents (I can't stand beer... hard liquor gal), but because of the irreverent-ness of the branding. To quote the label:

Tagline-- "You're Not Worthy"
Story-- "This is an aggressive beer. You probably won't like it. It is quite doubtful that you have the taste or the sophistication to be able to appreciate an ale of this quality and depth. We would suggest that you stick to safer and more familiar territory... maybe something with a multi-million dollar ad campaign aimed at convincing you it's made in a little brewery, or one that implies that their tasteless fizzy yellow beer will give you more sex appeal. Perhaps you think multi-million dollar ad campaigns make a beer taste better. Perhaps you're mouthing your words as you read this."
Ingredients-- "Nothing but the finest Barley, most aggressive Hops, clearest Water, our proprietary Yeast strain, and abundant Arrogance."

This company GETS IT! Stand up, stand out, shoot your mouth off, be different, be daring, anything... just please don't be safe.

Frustrated Friday

Catching a little bit of FoxNews this morning just frustrated me with politicians...

The next time you hear a politician use the word 'BILLION' in a casual manner, think about whether you want the 'politicians' spending YOUR tax money. A billion is a difficult number to comprehend, but one advertising agency did a good job of putting that figure into some perspective in one of its releases.

A. A billion seconds ago it was 1959.
B. A billion minutes ago Jesus was alive.
C. A billion hours ago our ancestors were living in the Stone Age.
D. A billion days ago no-one walked on the earth on two feet.
E. A billion dollars ago was only 8 hours and 20 minutes, at the rate our government is spending it.

While this thought is still fresh in our brain, let's take a look at New Orleans. It's amazing what you can learn with some simple division. Louisiana Senator, Mary Landrieu (D), is presently asking Congress for $250 BILLION to rebuild New Orleans. Interesting number, what does it mean?

Well, if you are one of 484,674 residents of New Orleans (every man, woman, child), you each get $516,528. Or, if you have one of the 188,251 homes in New Orleans, your home gets $1,329,787. Or, if you are a family of four, your family gets $2,066,012.

Washington, D.C .. HELLO!!! ... Are all your calculators broken??
Tax his land; Tax his wage; Tax his bed in which he lays. Tax his tractor; Tax his mule; Teach him taxes is the rule. Tax his cow; Tax his goat; Tax his pants; Tax his coat. Tax his ties;Tax his shirts; Tax his work; Tax his dirt. Tax his smoke; Tax his drink; Tax him if he tries to think. Tax his booze; Tax his beers; If he cries, tax his tears. Tax his bills; Tax his gas; Tax his notes; Tax his cash. Tax him good and let him know, that after taxes, he has no dough. If he hollers, tax him more. Tax him until he's good and sore. Tax his coffin; Tax his grave; Tax the sod in which he lays. Put these words upon his tomb, 'Taxes drove me to my doom!' And when he's gone, we won't relax, we'll still be after the inheritance TAX!!

Then, there's: Accounts Receivable Tax / Building Permit Tax / CDL License Tax / Cigarette Tax / Corporate Income Tax / Dog License Tax / Federal Income Tax / Federal Unemployment Tax / Fishing License Tax / Food License Tax / Fuel Permit Tax / Gasoline Tax / Hunting License Tax / Inheritance Tax / Inventory Tax / IRS Interest Charges (tax on top of tax) / IRS Penalties (tax on top of tax) / Liquor Tax / Luxury Tax / Marriage License Tax / Medicare Tax / Property Tax / Real Estate Tax / Service charge taxes / Social Security Tax / Road Usage Tax (Truckers) / Sales Taxes / Recreational VehicleTax / School Tax / State Income Tax / State Unemployment Tax / Telephone Federal Excise Tax / Telephone Federal Universal Service Fee Tax / Telephone Federal, State and Local Surcharge Tax / Telephone Minimum Usage Surcharge Tax / Telephone Recurring and Non-recurring Charges Tax / Telephone State and Local Tax / Telephone Usage Charge Tax / Utility Tax / Vehicle License Registration Tax / Vehicle Sales Tax / Watercraft Registration Tax / Well Permit Tax / Workers Compensation Tax.

STILL THINK THIS IS FUNNY? Not one of these taxes existed 100 years ago, and our nation was the most prosperous in the world. We had absolutely no national debt, had the largest middle class in the world, and Mom stayed home to raise the kids. What happened? Can you spell 'politicians!' And, I still have to 'press1' for English.

Uneasy Does It, Part 2

"The fishermen know that the sea is dangerous and the storm terrible, but they have never found these dangers sufficient reason for remaining ashore."
Vincent Van Gogh (1853--1890), Dutch painter

Uneasy Does It

"I do everything I can to disrupt my comfort zone." Brian Grazer, film producer

My first entrepreneurial venture started in the fall of 1983. I was 14 years old, had just made my high school's freshman cheer squad, and I was asked by a "cheerleader mom" to coach her daughter for the following Spring's tryouts. I had never considered cheering as a job opportunity before, and at the time, I was thinking about trying to hostess at the local Bennigan's.

Was I good enough? Could I promise this woman's 10-year old that she would have a real shot at making her elementary school squad? Could I put my own personal reputation on the line? My father said, "I know how you're feeling. But if you want to be successful in life, you'll have to get used to this feeling. This is risk. And if you ever want to take big steps in your career, you'll have to get used to risk."

Some things to consider before you decide to leave corporate life:
1. You feel a need to fulfill an ambition to create and develop something of your own.
2. You've been frustrated and limited over the years, feeling forced into a hierarchical structure.
3. You want to grow into a new area.
4. You can subsist without a steady income.
5. You have a sugar-daddy client.
6. You have a sturdy stomach and can take the terror of an un-ringing phone.
7. You can leave your current situation without burning bridges.

Little did I know at 14 that earning $50 bucks an hour for the private coaching of one little girl would turn into almost a hundred girls by the time I left for college. All of their mothers happily paying me upwards of $80 an hour and all of the daughters making their squads. I guess that leads me to end with...

8. You can handle controlling your own destiny and all the money that flows to those who take the risk.

Database Dilemmas

Building databases are easy... especially in these times of viral marketing and incentives to share contact info; making money with your database can be challenging. What are some common mistakes that cause databases to fail?

1. Diving in without a marketing strategy: A successful strategy involves collecting data on your customer's purchases, building a database that permits analysis, and determining what motivates your customers

2. Focusing on price instead of service: Database marketing builds loyalty, discounts do not. Database marketing strategies provide dialogue, recognition, and service that overrides price points.

3. Failing to link the database to the Web: Personalization requires information such as purchase history, preferences, and contact information that your sales reps need when they work directly with your customers.

Christmas Coupon Concepts

Being the holiday season and with all the enticements to spend more than the wallet allows, just what exactly prompts a customer to redeem coupons? And, should your company even bother with this type of promotion?


Time and value are the two most imporant variables to consider when looking to predict coupon redemption. Value has been relatively stable in recent years with low inflation rates while the trend has been to cut expiration lengths creating a greater sense of urgency (always a good thing).


However, many false notions about a couponing strategy faily to acknowledge that the redemption is less immediate, due to people's busier lifestyles, more dual incomes, and expanded home inventories (due to more closet/garage/pantry space). The following are a few myths:


1. MYTH: Targeting the most loyal users of a competitor's product yields the best return on a coupon program. FACT: Light to moderately loyal competitive users are more likely to try a new product.


2. MYTH: The presence of a sample is a requisite for driving high redemption rates. FACT: Other factors are much more likely to drive redemptions like expiration date, value, current versus competitive user, and frequent versus infrequent coupon user.


3. MYTH: Current and competitive product users need the same coupon value to be motivated. FACT: In any product sector, current users typically require a much less offer value to drive them to purchase.

Almost Famous

So, last night, I'm at the launch party for a new restaurant, Scene http://www.scenedallas.com/ , in a just opened residential high-rise... an intimate gathering of 3,000 of Dallas' finest. Which got me to thinking (as a friend and I are having our behinds felt up as the crowds brush by), do you have to "engage" the poser masses to find the niche you really want?

And then here's another thought... In this age of microcelebrity, are ALL these people necessary to make Scene be the place to be seen on the scene? (geesh... mouthful) Seriously, you can't feed 3,000 people anything. Tiny plates with 10 appetizers on it were devoured by one guy. Most of the alcohol was gone by 9pm, and then, in true $30,000-Millionaire form, the crowds disperse. Off into the night to find the next scene.

So, would the owners have been better off inviting a select 400 movers-and-shakers to really get a tour of the restaurant, hear the Executive Chef speak about what inspires his creations, have the wine steward share his most special selections? With a truly grand and unique experience (where you can actually SEE how the restaurant is designed), these 400 become advocates.

Who's the Boss???

So, yeah, you're the Idea Ingenue, the Wheeler Dealer, the Startup Czar. Now what? What do you do when you're no longer a startup, you have a couple dozen employees and things aren't as nimble (or easy) as they used to be? What happens when the collective lack of experience but oodles of enthusiasm starts to be a detriment rather than an asset?

Doug Tatum, a management consultant and author of No Man's Land: What to Do When Your Company Is Too Big to Be Small but Too Small to Be Big (BusinessWeek.com, 8/1/07) says many companies encounter similar problems when they grow to around 20 employees. That's when companies typically are forced to make the transition from the high-performance/cheap-labor model that worked in the startup phase of the business and start paying the real costs of labor and productivity.

Facing the reality that the Founder is probably not the "big-time" leader to take a company to $50 / $100 / $200 million is a real gut-check.
Bottom line question: What's more important to you, Top-Dog, your ego or your income?

Smart Start-Ups Know...

1. Failure IS an option-- without experimentation there is no growth.

2. Bravery is contagious-- the only way to find real success is for the entire team to challenge the status quo.

3. Rule books are dispensable-- throw out "the rules" you've lived with at large firms... what's the worst that could happen?

4. Lose the slackers-- you've got to have hypersmart, motivated people in this cutthroat environment.

5. Test for "too many of us are drinking our own Kool-Aid"-- if you start believing your own hype, it's all over very quickly. Keep it real.

It's in the Cards...

'Tis the season of the ubiquitous Christmas card so I must comment this morning on the lack of creativity and the utter lack of memorable-ness of most business cards. Note to small business owners-- this one tiny part of your company is the most important investment you can make... especially in the beginning.

Your business card represents your company; its brand, its voice, its quality, its character. Don't blow your one chance to make an amazing first impression with cheap card stock, uninteresting colors, text logos (unless you're a legal firm), and an overall lack of design with your total company brand in mind.

Or, you can try something completely different like Jeffrey Gitomer http://www.gitomer.com/
"In 1988, I had only two employees. One day, I decide to give my pet cat, Lito, a business card. I gave her a title, "Corporate Mascot." She played a vital role in my office productivity. Whever I needed an important paper, Lito was lying on it.

"The minute I started to give Lito's card out, word in the Charlotte business community spread like wildfire. Everywhere I went, people would ask if I had one of my cat's business cards with me. I always did. I wrote an article about it. Hundreds of requests came in for one of Lito's cards.

"I was at a networking event in Charlotte when a Fast 50 corporate president ran over ot me saying, 'Hey, Gitomer, show this guy your cat's card.' 'Have one,' I said, 'and have one of mine in case the cat isn't in. I usually handle her calls.'"

Be different... be memorable... the card pays you back.

Just-a Swingin'

Thank you so much to Scott Ellis, http://www.vsellis.com/, for sending me this extremely accurate portrayal of my world... Happy Friday, people! Only 25 shoppping days left 'til Christmas!!!

Thought for the Day Thursday

A consultant walks into a bar and says to a business owner, "Do you want me to lie to you about your marketing strategy for $400 an hour, or tell you the truth for $200?" The CEO says, "I'll take the truth for $200."

"Okay," says consultant, "the problem is that having you try to control your corporate messaging is like having an earthworm try to juggle... How's my premium pricing option sound to you now?"


MORAL-- "You can't handle the truth!!" Jack Nicholson as Colonel Nathan R. Jessup in A Few Good Men

Coming into Focus???

"Focus groups should be abolished," says Malcolm Gladwell, author of Blink and Tipping Point. Gladwell's statement, although controversial, rings true from certain marketplace experience. Everyone knows that consumers make purchase decisions emotionally and then justify their purchases logically. The problem with traditional focus groups is that participants think about their responses and what their answers should be. Therefore, the snap judgment, the hunch, and the emotion of the first impression are lost in all of the cogitating that goes into a focus group response.

The Aeron Chair by Herman Miller has become a cultural and commercial sales phenomenon. Gladwell pointed out in his breakthrough book Blink that it continues to be one of the best-selling office chairs in history. Had executives at Herman Miller followed advice to scrap the design based on extensive focus group testing, they might not be enjoying such record sales. Despite only moderate scores on comfort and extremely low scores on its aesthetics, Herman Miller went ahead with the introduction of the Aeron Chair. As a result, the company broke all sales records and still continues to reap huge rewards over a decade later.

Matching the promise of your brand with the priorities of your market is a huge advantage if your goal is to be the leader in your business category. Now the critical question is: "What are the customers’ priorities?” I believe that typical focus groups are ineffective at gauging what is really important (emotionally) to customers when choosing a product or service. The bottom line questions are "What's in it for me? How is this going to make me smarter/ more powerful/ more influential/ more popular/ sexier/ etc.?

Understanding your customers' and prospects' priorities before writing and designing communications to them is fundamental to marketing and sales success. Do you have a method for learning what your customers really think about and care about?

The Importance of Internal Marketing

While most companies allocate resources to understanding and communicating with their external customers, few make the same investment in time, energy, and money in communicating with their internal customers—their employees. Internal communications is traditionally viewed as the sole province of the Human Resources department, but it's essential to recognize the importance of marketing to internal customers.

Although external marketing remains the most important business development task, it is essential to sell inwardly toward a company’s people. When employees understand and commit to the value proposition of the company and its brands, external marketing becomes more effective, because the employees become product champions.

Internal marketing is becoming increasingly important as the pace of change accelerates. Many companies are undergoing some form of transformation through mergers, alliances, or downsizing. The need for communication is stronger in these circumstances.

When companies also change their brand, their name, or their values, it is essential to communicate the change to all stakeholders including employees. As companies empower staff to build stronger customer relationship, internal marketing underpins the drive for greater involvement, commitment, and understanding.

Constant organizational change can loosen the ties between employer and employee. Internal marketing can bring the parties together with shared goals and values. Internal marketing helps the process of knowledge development by building understanding and commitment to personal development.

Yes, I took some time off...

As you can tell from the dates on this blog, I took all of last week off for Thanksgiving. Nothing rejuvenates the brain and gives fresh perspectives like quality family time. Which got me to thinking about the concept of having time and how an entrepreneur needs to make the most of each day.

In order to "ease" us all back into the swing of things (even though it really is a downhill coast until January), I offer the following insight:

PR can equal unPRetty

Chris Anderson, the editor-in-chief of Wired Magazine and author of “The Long Tail,” ignited an online PR firestorm recently by posting a list on his blog of 300 PR people who had sent him unsolicited and unwanted PR pitches, saying that he had unilaterally and permanently added them to his blocked senders list.

I don’t approve of Anderson’s action — I’m sure he has better things to do than complain about PR. But his post does blow the cover off one of PR’s not so pretty secrets: selling PR to internal and external clients on the basis of quantity, not quality. Justifying your budget and importance by saying “we pitched the story to 200 reporters” has been exposed as a fraud, if your target list includes journalists like Anderson who are going to hit delete the second they see your pitch (or worse, simply block you from even reaching their inbox). You’ll have more long-term media relations success if you pitch quality — targeting the right journalists, building relationships, only sending them newsworthy stuff — over quantity.

Try a new approach... pitching to bloggers. they’re not mainstream media. Among the differences is that they have unlimited space to say whatever they want, including using their blog to blast PR people. Mainstream journalists are probably just as fed up with getting spam pitches as Anderson, but they aren’t going to waste precious ink or air time complaining about it.
Bloggers are the ultimate niche media. Every one of them has their own unique point of view and audience. It’s a waste of time and resources to send them blast email pitches. Scratch that strategy off your list. Instead, if you really want to reach a blogger’s audience, read their blog thoroughly, leave comments on their site, and then pitch them something customized for them alone.

Embracing Objections

If you find yourself constantly dealing with or dreading objections late in the buying cycle then there's something you're not doing early in the buying cycle: you're not creating objections. You should be.

Embracing Objections:
Stress is caused by the things you don't do. One of the largest sources of stress among those who do not see themselves as natural salespeople is the conversations they are avoiding. An objection is a little like bad news in the investment world: if it exists, you want to hear it as soon as possible. If you ignore it, it only gets worse.

The Race to Object:
Once you become aware of the potential objection consider yourself in a race to see which party can first serve it up to the other to address. Let's say that you, the buyer, beat me, the seller, to the price objection - you get it on the table first. I can try to convince you that the objection is not real, or I can share my concern and try to hand it back to you. “I have the same concern. Reengineering your entire business development approach is not a trivial investment. It's a sound investment, but my experience is that of firms the size of yours, not all can afford my fee, which I require in advance.”

The Common Mistakes:
The wrong way for me to respond to your objection is the way I typically responded throughout the early part of my career: defer (“Let's not worry about price right now – I'm sure we can work something out if we get that far,”) cave (“I might be able to lower my fee,”) or shamelessly convince (“You really need to make this investment. Isn't there some way you can come up with the money?”)

It may seem counterintuitive to create objections when you see yourself in the business of overcoming them, but look at it this way: the objections are there anyway, and somebody has to address them. Why not ask the client to do it?

Just ask early. Start looking for reasons why it might not make sense to work together as early into the relationship as possible and then ask the client to address them before he asks the same of you. You'll find out which objections can be dealt with and which might be cause to part company.

How NOT to Launch a New Product (or Business for that matter)

You've built the better mousetrap, now you're expecting the proverbial path-beating to your door. Here are some classic mistakes companies make while getting ready to launch.

1. Don't plan the launch until right before the release date-- Nothing is more disheartening to a PR or marketing consultant than to have a client call and say, "We have a great new product ready to launch next month. Can you develop a plan by next week?"

2. Carve your launch plan in stone-- Few new product introductions go exactly according to plan. Manufacturing snafus occur. Distribution gets delayed. Be sure to build flexibility into your launch plan. Always ask the unpopular question, "What if the launch date gets delayed?"

3. Put the head honcho in charge of the launch-- Brand managers or product managers are best suited to take primary responsibility for the launch process—not senior personnel whose multiple and competing duties can impair focus and tactical expertise. The involvement and support of the CEO, president and other senior leaders are critical to the success of a launch, but not on a daily basis.

4. Don't educate employees until after the news breaks elsewhere-- Your employees are your most important word-of-mouth brand ambassadors. Educate them about the launch plan and prepare them to talk about the product with their family and friends so they can begin to build the buzz.

5. Use the same forms of media you've always used-- The number of potential media outlets that can talk about your new product grows daily. Don't just dig out the same media list you used for your last launch. There are 6,200 magazines and 240 television stations available today, with hundreds more being introduced each year. Don't overlook Internet media outlets that might not have existed when you executed previous launches.

6. Skip the crisis plan-- The number of things that can go wrong when a new product hits the market is limitless. Brainstorm all potential pitfalls to ensure your plan provides remedies for what might go wrong. It's always better to have a crisis plan in place rather than trying to create one while facing a major issue that could tarnish your brand.

VETERAN'S DAY Monday

A quote from a U. S. soldier's blog while stationed in Iraq:

"Trying to make sense of this place is like trying to move a mountain by smashing your face into it."

Thank a REAL hero and their family today.
Be thankful for all our nitpicky little problems in the business world.
Free enterprise isn't free, and the servicemen/women pay the toll.

Another Funny Friday...

XOXO!

Can Entrepreneurship be Taught?

excerpts taken from BusinessWeek online article by Stacy Perman

"If I go into any social setting, people always wonder how can you teach entrepreneurship," says Richard Goossen. Goossen, a lawyer, businessman, and academic, has founded startups, acted as strategic adviser to high-growth companies, written three books, and spoken extensively on the subject of entrepreneurship. So, he decided to explore the topic further.

He rounded up a group of entrepreneurship experts ranging from Peter Drucker (Businessweek.com, 11/28/05) to Rita Gunther McGrath to Karl Vesper. He culled their insights, broke them down, and published the results in his most recent book, Entrepreneurial Excellence: Profit From the Best Ideas of the Experts (Career Press; 2007). "My motivation was to talk to the top researchers and instructors in the world who teach something that a lot of people think can't be taught," he says.

Goossen came to the conclusion that while there are several elements that can be taught to enhance the knowledge and success of entrepreneurs, entrepreneurship is something one can learn only by doing. "With law or accounting,you can teach a set of principles that a student can master to become a competent practitioner," he says. "But teaching entrepreneurship is tough. In a class it's hard to predict who will do well and who will not."

As a result of his research, Goossen has come up with three entrepreneurial elements that can be taught:
1. General business knowledge—what he calls "the nuts and bolts of management principles and strategic thinking."
2. General entrepreneurial principles. You can lean from what other people have done and where they made mistakes.
3. How to be alert to opportunities in certain fields in a general sense.

What can't be taught, on the other hand, is what Goossen calls "venture specific opportunity principles." By that he means the ability to understand and see specific niches in a market and recognize whether it will be successful or not. "You can't teach someone how to know what will work and what won't," says Goossen. "You can't even duplicate the set of dynamics of a past success."

It seems to be an inate gift. Take it from the daughter of a 40-year career Texas Instruments dad and a 40-year career schoolteacher mom, I should know... the first entrepreneur in my family.

Time Keeps on Slippin', Slippin', Slippin'......

William Shakespeare (1564-1616) once said, "I wasted time and now time doth waste me."

Don't waste the MONEY HOURS: the hours in a sales day when you can talk with prospects and/or customers… the most valuable hours of the day, make the most of them. Schedule reporting, email/faxes, and reading documents between 6am--9am and 6pm--9pm.

Sounds like a no-brainer, but you'll look up and you'll been pulled into an email exchange with an internal employee for over an hour... mid-morning. Ugh. Waste of your time and theirs. Establish these boundaries and watch productivity soar.

The Truth, the Whole Truth, and Nothing but the Truth

or... What is your return on "marketing integrity?"

A Yankelovich study a few years ago found that as many as two-thirds of Americans believe that businesses would take advantage of the public if those businesses did not think they would be exposed. As many as one-fourth of Americans agreed that there is literally nothing that business can do to recapture their trust once it is lost. ("State of Consumer Trust," 2004).

Most marketers may be honest in the sense that they do not blatantly lie or intend to mislead, but the definition of "honest" is shifting to a higher realm since customer loyalty (and trust comes before loyalty) is at a premium. Traditional Return On Marketing Investment is calculated using Gross Margin generated by marketing efforts (GM), minus the Marketing Investment (I), divided by that investment: ROMI = (GM - I) ÷ I. The calculation for return on marketing integrity is identical, except that investment is replaced with marketing integrity.

Simple enough to explain, considerably more difficult to measure. An example would be a company investing significant man hours and dollar expenditures ensuring that every marketing claim is ruthlessly checked with R&D for accuracy, then any attitudinal or behavioral gains among customers can be at least partially credited to those investments.

Now, why would a business make these extra efforts? Yes, everyone wants more customers, but is it really worth the time and effort? Yes, for several reasons:

1. Measuring the impact of integrity can help marketers learn some of the reasons why customers are buying in the first place... revealing why they remain loyal will lead to increased profitability.

2. Tracking integrity may uncover new ways to attract more new customers... discovering what your company's unique value proposition is (in your customer's eyes).

3. By regularly comparing integrity performance and financial bottom-line impact, businesses may be able to significantly reduce the unforced integrity erros that have cost other companies brand equity and sales declines... i.e. was "New Coke" really new?

4. Maintaining a sense of marketing integrity can protect brand image when a company is under scrutiny... ex: Enron; 'nuff said.

During a credibility crisis involving the troubled General Re acquisition, Warren Buffet once observed, "Berkshire can afford to lose money, even lots of money; it can't afford to lose...even a shred of reputation." If the Oracle of Omaha can't afford it, neither can the rest of us.

Why I Love Park Place Motorcars

Bought a new car this morning. My second purchase at the same dealership. Park Place is just about the last place in the world where every personable exchange, product, and service is completely customer service oriented. Here's to a really admirable company... you have a customer for life!

A Funny for Friday

How much does this remind me of everything involved in the consulting world?

"Thought for the Day" Thursday

LIFE IS TOO SWEET TO BE BITTER... 'nuff said.

Happy November 1st

Want Brand Extension? Create New Products

from this past weekend's edition of the Wall Street Journal

When it comes to brand extension, conventional wisdom states "don't overextend." Which is even more a maxim with startup companies. Coming out of the gate with too many product identities makes your business look unfocused and like it's trying to hard to be a "me too!" company.

The problem with the don't-overextend mind-set is that executives can easily fall into the trap of inbreeding: overwhelming customers with narrowly different new features and calling these items "new brands." Paradoxically, in an attempt to not overextend the product line, managers do exactly that leading to "feature glut" and reduced usability for consumers.

Get a new perspective--
OLD THINKING: Product managers often limit their imaginations by trying to improve their goods incrementally, daring only to add new features that supplement the original product purpose.
WHAT YOU MISS: By cross-breeding, you can take completely dissimilar products and combine them in ways that inspire wholly new functions.
RESULTS: A shoe-and-iPod combination from Apple and Nike, for instance. This shoe enhances athlete training by turning the iPod into a step and pace counter as well as an entertainment source.

So, look at products in terms of their external attributes and how they are used. How well would your product play with others?

That's Just How We Do It Here

Let me be clear. In business, I'm all for brand consistency so that your customers understand exactly who you are and what you do.


However,

Valuing Your "Free" Customers

Businesspeople understand that not all customers are created equal—the 80-20 rule suggests that over time a small percentage of a company's customer base can generate a high percentage of its sales and profit. Models for calculating customer lifetime value (CLV) are built on just such a premise.

However, new research is starting to look at customers whose value is not as readily apparent and where CLV calculations break down. In a recent working paper, Harvard Business School professor Sunil Gupta calls them "free" customers—think of buyers at an auction. Traditionally, auction houses make most of their profit from fees paid by sellers; buyers don't pay fees. So although buyers are a necessary ingredient to the deal—no buyers, no sellers—their value is more difficult to quantify. To the auction house, is one buyer worth four sellers? Is one buyer worth one seller? That answer is critical for the auction house, which must determine how to allocate marketing and other expenditures between buyers and sellers to attract new business.

Now consider a firm such as eBay that has two sets of customers—buyers and sellers. EBay generates almost all its profits from sellers through commissions and listing fees. Buyers do not provide any direct profit to the firm. However, without buyers, the firm would have no sellers and vice versa. This kind of situation, which is called a two-sided market, is common in many industries such as real estate and employment services. A traditional model of CLV will not be able to estimate the worth of a buyer. And, how about "indirect network effects" where more buyers potentially attract more sellers and vice versa?

Customer value changes over time. As a business owner you have to know that, in general, each individual customer value initially increases as the company grows and then later declines when the firm reaches a critical mass or maturity. And, you have to know that it is quite possible that some customers have low tangible value (i.e. they don't buy anything), but high intangible value (i.e. they promote your company/ talk about your products to others in a positive way/ use their influence to encourage others to buy). Traditional models would label such customers as low value and would miss a huge opportunity for a firm.

THOUGHT FOR THE DAY Thursday

"Fairy tales do not tell children that dragons exist. Children already know dragons exist. Fairy tales tell children that dragons can be killed."
G.K. Chesterton

Today, go forth and slay yours...

Problems or Opportunities?

It's all in how you look at it. A typical day... you start out fresh, energized and focused on what you want to accomplish. Then, you get the impromptu request from a staff member to speak with you. Next comes the sit-down with your company's other leadership team members. Then, the irate customer, the broken shipment, and the failed computer system. In short, problems.

Why can't the everything flow like it's supposed to? Why can't everyone just do their job and get along? Is your first response that your defense mechanisms go off with a "what the #@&! is wrong with you people?!!??" Or, do you welcome these scenarios as an opportunity to stretch yourself and shine?

Relax. Merriam-Webster defines "problem" as an inquiry for consideration. A problem is merely a question awaiting a solution. Tricky part is being able to handle yourself while answering it and most of us are not equipped with a proven problem solving process. Get one... fast.

Networking Not Working? Here's a Clue... It's YOU!

I have two networking events to attend tonight, so I thought this subject quite relevant today.

from Jeffrey Gitomer and his AMAZING book, "Little Black Book of Connections"

11.5 Steps to Win Prospects and Contacts at a Networking Event:

1. Target the people you want to meet
2. Talk to them (wow! I actually have to write this!)
3. Get information from them that pertains to you
4. Get them interested in what you do
5. Categorize them (mentally) on the back of their biz card as soon as you get it-- A. wants my product B. knows someone who may want my product C. valuable contact D. professional contact E. useless contact
6. Qualify the contact (if they're a candidate to buy, are they likely to buy?)
7. Establish more rapport and find some common ground (make nice)
8. Remember the information they've given you (write it on the back of their card as soon as you finish the conversation)
9. Make the next appointment to meet (i.e. "We should get together and have a coffee some time."
10. Write the commitment made on the back of YOUR card-- the one you hand to the prospect. (write it also on the back of their card you keep)
11. (this is key!!!!) MOVE ON to the next person (no, you haven't made a best friend for life and most sales people blow a sale by just being "there" too much)
11.5 Follow up in less than twenty-four hours after the event to confirm the next meeting

The BRILLIANCE of DUMB Ideas

It isn't the Idea... It's the Execution. Winning companies put together winning business systems around usually unoriginal ideas.

The hard work of marketing lies not in developing a ground-breaking, earth-shattering, jaw-dropping campaign, but in coordinating the efforts of R&D, manufacturing, finance, communications, and sales. Do this right the first time, and you've created a team that knows how to compete and win new business and new customers over and over again every time.

Getting the Upper Hand: Leverage

It's THE most important aspect of any negotiation... levergage: the perceived advantage that one party has over another. Since leverage is based on perceptions, this subtle factor can change quickly and frequently through deliberations and even over the course of the relationship.

Many studies have shown that overall and generally women are lacking in this skill set compared to men. I'm not going to argue that theory one way or another here. Just offering some suggestions that I've learned along the way.

Prior to any negotiation, know the answers to the following questions:

1. What do I want?

2. Why should the other party negotiate with me?

3. What are my alternatives?

The key to determining leverage in a negotiating situation is assessing your needs and wants (question 1) and your other options (question 3), which will help you understand and control the other party's perceived advantage and answer question 2. The answer to question 2 is determined by the other party's perceived wants/needs and alternatives... which you might be able to sway.

Indicators of leverage are:

1. Who is initiating contact?

2. Meeting location? Their turf or yours??

3. Wait time prior to the meeting

4. Style of dress (the more formal, generally, the more submissive)

5. Gift-giving and meal-buying

6. Seating arrangement

7. Space and posture

8. Number of colleagues at the meeting (the entourage)

9. Touching and eye contact

10. Order and amount of speaking

11. Age

12. Gender (yes, I'll admit it... unfortunately, in most cultures women come second in business)

Startup Funding-- A How-To Guide

Getting a startup funded isn't easy. There's lots of hype, "grip-n'-grin," and tearing hair out along the way.

You might also think that everyone knows everything about startup funding, but that’s not the case. Recently, someone asked me about the differences between angel and venture financing. With that in mind, I’ve put together a few options for startup funding.

1. CAN YOU BOOTSTRAP IT? SHOULD YOU?: Bootstrapping means you fund the startup on your own. Scrimp, save, and squeeze by on the minimum that you can. The advantage of bootstrapping is simple: you retain control. You’re not diluted (by investors), there are no additional chiefs (read: board of directors, influencers, etc.), you can go at whatever pace you see fit and retain your vision. But, the disadvantage of bootstrapping is a lack of capital (unless you’re rich.) That lack of capital can be a significant constraint. If you can’t afford to keep the business moving forward, you’re in trouble. And first-time bootstrappers frequently under-estimate what things will cost.

2. LOVE MONEY: The money you get from friends and family. If you can get, go for it. The benefit is that it should be easier to get the money (vs. raising from outside sources), and you’ll gain some experience pitching in a friendly environment. The disadvantage is that you run the risk of ruining personal relationships. And, unless your friends and family are wealthy, $20-$25k won’t get you that far.

3. ANGEL FINANCING: Angel and seed financing comes into play before a business has launched its product, or shortly thereafter. It’s the money you need to make it happen out of the gate. Amounts range from $25,000-$1,000,000. Venture capitalists that play in this area will often look at the $250,000+ range, whereas individual investors will be (typically) less. The higher you go, the closer it gets to a Series A (described below), which means more effort and paperwork to close.

4. SERIES A FINANCING: Series A investments can happen at a fairly early stage - just after launch, for example - depending on how long the company has existed beforehand. In most cases, a Series A is used once the company has shown some traction and needs more money to expand. It’s the money that will take you to new heights, massive revenues, cash flow positivity and a huge payday via acquisition (or some other exit.) At least, we hope that’s the case!
Series A financing ranges a great deal (think $2 million to $10 million or more) and Series A typically comes from venture capitalists. At this stage, you’ll want to bring in the strongest partner possible; the VC firm with the most experience in your space, the highest pedigree and the most success stories.

FINAL THOUGHTS--
Be prepared to pitch... A LOT! Don't get discouraged; you will get better at it.

Get organized. This sounds silly, perhaps, but the more organized and professional you look, the more comfortable investors will feel. This is especially true when it comes to presenting financials. Know your financial models.

Get help. Seek out the advice of mentors, advisers and lawyers. A good lawyer can really help with more complicated deals.

Do your own due diligence. You’re about to get into bed with someone, you might want to check what they have under the covers. Don’t be afraid to ask for references.

Never stop fundraising. I’m definitely not in love with the fundraising process, but there’s no point stopping. Keep building relationships with investors, keep nosing around for opportunities. You never know how markets will shift and opportunities need to be capitalized upon.

The Cycle of Greed

So, What's Your Story?

From Lois Kelly, author. If you’re pitching your company to investors, customers, partners, journalists, vendors, or employees and you don’t use at least one of these story lines, you probably have a problem. And, even worse, most likely you’re too close to what you’re doing, so you think that you’re uniquely “patent-pending, curve-jumping, and revolutionary.”


1. ASPIRATIONS AND BELIEFS: More than any other topic, people like to hear about aspirations and beliefs. (This may be why religion is the most popular word-of-mouth topic, ever.) Sun Microsystems’ Scott McNealy’s point of view about ending the digital divide is aspirational as is Patagonia founder Yvon Chouinard’s views about how companies can grow by reducing pollution and creating more sustainable business strategies. Aspirations are helpful because they help us connect emotionally to the speaker, the company, and the issues. They help us see into a person or company’s soul.

2. DAVID vs. GOLIATH: In the story of David and Goliath, the young Hebrew David took on the Philistine giant Goliath and beat him. It is the way Southwest Airlines conquered the big carriers, the way the once unknown Japanese car manufacturers took on Detroit, and the way social media is taking on the media giants. Sharing stories about how a small organization is taking on a big company is great business sport. Rooting for the underdog grabs our emotions, creates meaning, and invokes passion.

3. AVALANCHE ABOUT TO ROLL: The mountain is rumbling, the sun is getting stronger, but the rocks and snow are yet to fall. You want to tune in and listen to the “avalanche about to roll” topic because you know that there’s a chance that you will be killed if caught unaware. This theme taps into our desire to get the inside story before it’s widely known. It’s not only interesting to hear someone speak about these ideas, they have the ingredients for optimal viral and pass-along effect.

4. CONTRARIAN / COUNTERINTUITIVE / CHALLENGES ASSUMPTIONS: These three themes are like first cousins, similar in many ways but slightly different. Contrarian perspectives defy conventional wisdom; they are positions that often are not in line with—or may even be directly opposite to—the wisdom of the crowd. The boldness of contrarian views grabs attention; the more original and less arrogant they are, the more useful they will be in provoking meaningful conversations. Counterintuitive ideas fight with what our intuition (as opposed to a majority of the public) says is true. When you introduce counterintuitive ideas, it takes people a minute to reconcile the objective truth with their gut assumption about the topic. Framing views counter to how we intuitively think about topics—going against natural “gut instincts”—pauses and then resets how we think and talk about concepts. Challenging widely-held assumptions means that when everyone else says the reason for an event is X, you show that it’s actually Y. Challenging assumptions is good for debate and discussion, and especially important in protecting corporate reputation.

5. ANXIETIES: Anxiety is a cousin of the avalanche about to roll, but it is more about uncertainty than an emerging, disruptive trend. Examples of anxiety themes abound: (1) Financial services companies urging baby boomers to hurry up and invest more for retirement: “You’re 55. Will you have your needed $3.2 million to retire comfortably?” (2) Tutoring companies planting seeds of doubt about whether our kids will score well enough on the SATs to get into a good college. Although anxiety themes grab attention, go easy. People are becoming skeptical, and rightly so. Too many politicians, companies have bombarded us with FUD (fear, uncertainty and doubt) with no facts to back up their point.

6. PERSONALITIES AND PERSONAL STORIES: There’s nothing more interesting than a personal story with some life lessons to help us understand what makes executives tick and what they value the most. The points of these personal stories are remembered, retold, and instilled into organizational culture. Robert Goizueta, the respected CEO of Coca-Cola, said he hated giving speeches but he was always telling stories—often personal ones about how he and his family had to flee Cuba when Castro took control and had nothing more than his education.
Similarly, when Steve Jobs gave the commencement address to Stanford University in June 2005, he shared his personal story and life lessons. That commencement address, “Stay Hungry. Stay Foolish,” was talked about on thousands of blog and was published verbatim in Fortune magazine. It helped us see Jobs in a new light.

7. HOW-TO STORIES AND ADVICE: Theoretical and thought-provoking ideas are nice, but people love pragmatic how-to advice: how to solve problems, find next practices, and overcome common obstacles. To be interesting, how-to themes need to be fresh and original, providing a new twist to what people already know or tackle thorny issues like how to get IT and marketing organizations to work together despite deep culture clashes between the two.

8. GLITZ AND GLAM: Robert Palmer sang about being addicted to love. Our society is more addicted to glamour and celebrity. Finding a way to logically link to something glitzy and glamorous is a surefire conversation starter. For example, tagging on to the widespread interest in the Academy Awards, Randall Rothenberg, former director of intellectual property at consultancy Booz Allen-Hamilton, last year talked about the similarity and challenges between creating new “star” product brands and movie stars.

7 Secrets for Creating Creativity

1. BAN BRAINSTORMING MEETINGS: Creativity is spontaneous. Formal meetings are a poor forum for creation. People choke because they show up for a limited time with a narrow agenda.

2. PRACTICE DA VINCI'S CODE: When your organization tackles a problem or a project, wipe the board clean of all asumptions and prior knowledge. "Tabula rasa."

3. PLAY NICE WITH OTHERS: New technologies grow out of a process of tweaks and upgrades, with a variety of contributors adding their own nuts and bolts. Collective thinking doesn't play well with prima donnas.

4. BURN THE CORPORATE POLICY MANUAL: To think freely, you have to act freely. A fanatical dedication to free speech unencumbered by top-down prohibitions causes unproductive behavior to melt away of its own accord.

5. RULE OUT "DEGREE-ITIS": There is no hierarchy based on titles and the lowest member of team should received the same hearing as the Ph.D.

6. MASTER THE ART OF INTERDISCIPLINE: Big breakthroughs are often the result of people crossing disciplines. Rotate your specialists out of their specialties and promote generalists ahead of narrowly focused experts.

7. TRASH YOUR OUTLOOK CALENDAR: Okay... not literally (I wouldn't have a brain anymore!!!) What I'm saying is to give up time-management techniques and devote each hour of every workday to whatever task or inspiration arises spontaneously. With all those meetings and infinitesimal tasks, don't snuff out your creative sparks before they have a chance to fly!

Just Own Up...

This week the condos where I live had a major catastrophe. A disgruntled resident was first assaulted by a property manager, then evicted 24 hours later. The resident immediately set up a blog, has advertised the URL to everyone on property, and has hired an attorney. To say "chaos-of-he-said-she-said" and potential media frenzy is an understatement.

However, this situation got me thinking about Crisis Management for companies and the fact that survival often hinges on what you do and say in the first few hours. What the news media report in their first stories — and how they view your coping skills — will often set the tone for the entire crisis. Chances are, the media's first impression will persist until you have overcome the problem and emerged victorious ... or you've been humiliated, fired, put out of business, arrested, sued, divorced ... the list goes on and on.

Of course, planning for crises is something we avoid. It is like buying life insurance or long-term disability insurance. Most people don't do it because they don't want to think about the possibility of their own death or disability. We have been forced by law and mortgage lenders to get accustomed to buying accident insurance for our cars, homeowners insurance for our houses. But we still try to avoid contemplating those greater disasters that can lead to the destruction of our businesses — the careers, productivity and morale of the people who work there.

Most companies have written plans for fires, storms, floods. They practice those plans frequently. Should a fire or storm or flood occur, everyone will know — without thinking — what needs to be done and how to do it. Yet, very few organizations have media crisis plans. And those that do rarely rehearse them.

The truth is most of you reading this will have a media crisis long before you have a fire or tornado or flood. And media crises in a media-driven society can be much more damaging, much more demoralizing than those hazards of nature. If and when the media discover the crisis, your skill in influencing how they report it — or decide not to report it — are key factors that determine the outcome.

The tone of the early stories usually hinges on how well reporters and editors know you, your understanding of media strategy, your experience and reflexes in dealing with journalists.
One of the most difficult steps in crisis management is making the decision that there actually is a crisis. (An annoyed customer setting up a blog MIGHT be a clue?!?) Wait too late, and you may not be able to save the sinking ship.

IDEAS-- If you can't beat 'em, buy 'em! Then, kill 'em???

Forget-Me-Nots

In any company, no matter the size, it all comes down to the one-on-one exchange between the buyer and the seller, and a great first impression can make or break the sale -- and how memorable your business is to others will determine your success. Marketing is constantly being told by Sales to "gimme something I can pitch." Salespeople want to think they're being unique or memorable by trying to impress the client with their product knowledge. Not so. Others believe if they have a flashy way of presenting their product, they'll stand out. Yes, your firm may stand out, but for the wrong reason. The goal isn't to be remembered by being outlandish or a know it all .

What about your business? How are you remembered and talked about by your clients? Here are a few ideas to be more memorable:

YOUR LASTING IMPRESSION: First impressions are very important. In all communications, make sure your entire team is careful what they say when they meet someone for the first time. The first impression can make the difference between getting the business or getting the boot. However, there's one thing greater than a first impression. It's your lasting impression. Be concerned more about what your company does more than what your people say. The rhetoric gets the shot, but the actions define who you are.

YOUR IMAGE: What does your firm look like? What do people think of when they say your company's name? Your image is priceless in sales. Your people don't need to wear Italian suits or designer shoes to be viewed as a professional. However, you do need to think about how you can stand out from the competition. I love to wear t-shirts, jeans, and flip-flops. If I showed up to a presentation like that, no one would listen to the message because my image would be a negative distraction and reflective of too laid back an attitude in business. Your company image needs to reflect what you want to be remembered by. Teach all your people to think before you wear and create an image that's worth remembering.

YOUR REPUTATION: Does it really matter what people think about your business? Of course it does if you care about making sales. Your reputation is everything in business, and yet, most people put little effort into what their reputation is on the street. You need to plan for your company's reputation... it is something to be crafted and molded because it eventually becomes your brand. Start by thinking about who you are. What do you want to be known for? What do you want others to say about your business? After you come up with the answers, work on the plan. Want people to think your company is reliable? Then, all your people will show up on time for meetings. Want people to trust your products and services? Then, always honor your word. Your reputation is something that takes a lifetime to build and a moment to take away. Pay very close attention to the actions of everyone in your company and remove those who present obstacles to a stellar reputation.

Pardon Me, but "Your Competitive Edge is Becoming Dull"

Keeping customers is one of the most effective and yet neglected ways to control marketing costs. There are always new and inspirational tactics for holding onto those customers you've spent so much to acquire.

1. Offer Personalized Picks and Services: We all know Amazon.com does this to perfection. So, let's look instead at Netflix, the online movie rental service. The various tools available at Netflix enable you to pick movies that you want to watch and put them in the order you want to receive them.

2. Ask for Opinions: Both your satisfied and not-so-satisfied customers have lots of valuable information to share with you. Begin to regularly send surveys to customers who have returned items and find out why they did so. Offer a dollar incentive, such as $25 off the next purchase, to those customers who respond to the survey.

3. Research Before You React: Do you have any idea how much an individual customer is worth to you at the point when he or she is ripping your head off for a customer service issue? Even though I don't have the world's most integrated systems, I always train our customer service staff to check how much a customer has spent with us over the years (and how often) before making any kind of service decision. Yes, I'm stating the obvious no matter how un-PC it might be... some customers are more valuable than others.

4. Create a Client Portal: Service and software businesses are more and more frequently creating useful client portals in which customers gain access to exclusive information about the service, the industry or both. One approach is to enable customers to share information with one another in terms of experiences, tips and tricks. Create a place where they can blog to each other about you... Wow! What amazing feedback you'll receive!

5. Reward Loyal Customers, Part 1: This may seem like a no-brainer, but how often have you seen ads or commercials for a service you already use wherein new customers are offered great deals while you just sit there feeling neglected because you're paying more for the same product or service? This is maddening to existing customers. Your conundrum is figuring out how to lure in new customers with a good teaser rate without alienating your existing customer base. How about a reward program based on how long they've been a customer?

6. Reward Loyal Customers, Part 2: Another way to reward customers is with one of those ubiquitous "membership" cards or programs that accrue points or whatnot the more you spend with the company. In some cases these types of programs have revolutionized industries - for example, frequent flyer miles.

And, finally (and most importantly!)
7. Under Promise and Over Deliver: Give existing and prospective customers lower predictions of solutions/satisfaction rates/completed sales/etc. than is typical. Spell out that you are looking to manage their expectations by quoting figures that are lower than average in terms of solutions and goals met. Your clients and prospects will appreciate the candor and realize they're not getting a typical "sales job" filled with a bunch of happy talk and bombast. It has the effect of increasing the comfort level and trust in the deal.

Make Sure Your Customers Love You

Everyone knows what a bad customer experience feels like. Your account representative calls you to sell you something and is surprisingly clueless about the hassle you’ve been having with the service department for the last three weeks. You keep getting so many irrelevant emails from a company that you eventually tell them to stop spamming you. You call customer service for clarification about something you saw on their website, and they give you contradictory information—or don’t even know what you’re talking about. Most of our negative experiences as customers occur when the companies we deal with can’t give us the answers we want or don’t seem to be aware of us as individuals. The consequences of such experiences go well beyond wasted time and tense conversations.

Great customer experiences, on the other hand, are of extraordinary value. Companies that keep their customers happy tend to keep their customers. They have strong brands and generate a lot of free word-of-mouth advertising. They are also better able to overcome the problems that inevitably occur when they ship faulty products or make other types of mistakes—since studies show that customers often become even more loyal to a company when it effectively "recovers" from such a mistake.

In today's hyper-connected world, a great customer experience is even more important. Customers have virtually infinite choices and can therefore take their business to a competitor at the slightest provocation. Competing in this market on price alone is a direct route to ever-thinning margins. And, while a good and/or somewhat differentiated product is essential for getting into the game, you can still get leapfrogged by the competition—or lose customers by mistreating them just once. So, today’s customers simply expect more than just a good product or a low price. They expect to be treated well and will settle for nothing less.

The best practices listed below all revolve around one central principle: Knowledge At the Point of Action (KAPA). Every time your company interacts with a customer—whether it’s a marketing, sales, or service interaction—there is an exchange of knowledge. Knowledge may flow from your business to the customer, from the customer to the company, or both. But the quality of this knowledge exchange directly impacts the quality of the customer experience. A great customer experience therefore requires that knowledge exchanges take place in a timely way across all communication channels, and that the knowledge exchanged is consistently accurate, relevant, clear, and up-to-date.

Some best practices for KAPA are:
• Effectively and efficiently capture all required knowledge types
• Maintain accuracy, relevance and freshness of knowledge over time
• Facilitate knowledge access for customers, frontline employees, and partners
• Leverage a common knowledge foundation across departments and channels
• Fully exploit self-service where practical and appropriate
• Continually measure and improve KAPA effectiveness

KAPA therefore requires organizations to capture all types of knowledge relevant to the customer experience, including:
• CRM data
• Real-time process knowledge such as sales cycle status, the progress of a multi-stage campaign, or the age of an open incident
• Product and service knowledge such as technical specifications, pricing, special promotions, appropriate use and warranties
• Company knowledge such as store locations, return and refund policies, news about mergers and acquisitions, customer references, and third-party partnerships
• Competitive knowledge about other companies’ offerings and activities
• General knowledge about technology, regulations, or markets that customers need to make better use of a product or employees need to do their jobs more effectively
• Analytical insight that managers need to continuously improve the customer experience—such as performance metrics (campaign response rates, first-call resolution rates, etc.), defect/complaint trends, and survey results

Emerging Marketing Vehicles

In marketing, companies are moving online across the spectrum of marketing tactics, from building awareness to after-sales service, and they see online tools as an important and effective component to their marketing strategies.

Web-based sales and services were the early uses of the Internet for marketing. Today, providing service information on Web sites, interacting with customers via email, and executing information transactions are more widely used. Some companies are even experimenting with selling in virtual worlds.

The evolution under way in digital marketing reflects fundamental changes in consumer behavior. More and more people use the Web, instead of books, the yellow pages, libraries, car dealers, department stores, or real-estate agents, to search for information. In doing so, they often become aware of new products and compare prices.

How far will these shifts go? McKinsey & Co. research says that by 2010 the Web will play a role in the first two stages of the consumer decision-making process-- product awareness and information gathering-- for a sizable marjority of all consumers. The expectation that most consumers will seek out new products online may be a factor in the plans of companies to increase spending on several digital-advertising tools they see as most useful in building brands.

Corporate Coffee

You think your business is stagnant... needs some new life... a shot in the arm. Does your company need some caffeine?

Below are some idea generators for best practices in the Marketing realm. No, I'm not suggesting a new promotion, advertisement, campaign, or gimick. Those are "tactics." If you feel your company is dragging, what you need is some real thought leadership.

- Do you have a 3-5 year business plan?
- Are you running your business from that plan?
- Do you set objectives and reach them (accountability)?
- Do you manage your business from a "dashboard?"
- Do you know your non-financial, critical performance measures?

A "no" answer to any of these questions lead to:
- Errors that cause high turnover
- Errors that will directly reduce profitability
- Errors that will never let you raise your prices
- Errors that will cause you to lose customers

Word of the Day: Geodemography

GEODEMOGRAPHY refers to where people live, how they earn and spend their money, and other socioeconomic factors that influence buying decisions. In Marketing, the study of demand related to geographic areas assumes that people who live in proximity to one another also share similar consumption patterns and preferences.

Shoppers, whether Sunday-at-the-mall-browsers or high-end-technology-solution-purchasing agents at XYZ, Inc., now expect retailers to provide an ‘experience’. They expect to be entertained as they shop and sellers who are looking to show the value that they provide are looking to display what The Future Laboratory refers to as ‘masstige’: the requirement to mass prestige.

In an attempt to create value for shareholders, high-end brands (i.e. Mercedes) are reaching lower, whilst lower-end brands (i.e. Gap) are reaching upwards. Brands across all industries and marketplaces are going to great lengths to create a experiences and perceived solutions that serve a targeted "identity" of buyer.

Making Mistakes Speeds Success

The only people not making mistakes are ones playing their game without risk and without novelty, and I might add, without progress. If your company cannot accommodate, even reward, failure... in the long run, you cannot succeed.

Why? Doing things wrong, is the number one , and perhaps the only, source of innovation. The reason is simple: the best solutions to most problems are rarely the most obvious." James Joyce said it poetically, "Mistakes are the portals of discovery." Think about it. What did you ever learn by doing something right the first time? IBM's rumored motto about mistakes is legendary: Fail Faster.

If you are in the surgery business or fly airplanes for a living, you may not want to make any mistakes. But for the rest of us, especially if you are in a technology business, doing things wrong is prerequisite to doing things right. As the philosopher Ludwig Wittgenstein said, "If people did not sometimes do silly things, nothing intelligent would ever get done."

Don't penalize mistakes, encourage them. Hey, how about rewarding them? How about creating a bonus for the most brilliant (or most flagrant) mistake of the month. Put risk-taking mistake-makers' faces on your website or in your newsletter. Give them kudos! Many companies say they encourage mistakes, but really intimidate and punish the mistake-makers. As soon as you begin to do that you foster a better-safe-than-sorry attitude. Instead, put your money where your mouth is.

What about having a regular meeting dissecting the mistakes-of-the-month, trying to learn their lessons. Train people to savor their mistakes, and understand the strange paths which lead them astray. Who knows... you just might blow the lid right off your business and launch it into the wild blue yonder of glorious success.

Recognizing Loser Businesses

The ability to differentiate between winners and losers permeates virtually every aspect of our lives. Cadillac or Yugo, Bach or Courtney Love... the ability to quickly discern the gold from the tin in our lives has a profound and long-lasting impact on our power to maintain an upbeat, happy attitude.

The same is true of getting yourself involved in new businesses/projects. Is the company you are considering a winner, or a loser? If it's a bad project, you could end up losing a significant intellectual and emotional investment once it crashes and burns, and the blame starts flying. Associate with a winner company, and your career could go to warp speed. So, how do you tell the difference?

While winning businesses/projects can display a dizzying variety of characteristics, but the losers will often have key symptoms in common. Here, then, is a list of the top five indicators that your project is a loser.

POOR OR NON-EXISTENT SCOPE DEFINITION: If you have never been involved in a project or startup company with rampant scope creep, it's a thing to behold. Since the actual goals being worked remain in a state of flux, progress against the moving target is next to impossible. I witnessed a disaster of a project, where the scope was never clearly defined. What was being worked on that week was decided in Monday morning meetings, after which some teams were suddenly tasked beyond belief, while others were just as suddenly idled. These teams changed week to week, so that the staff were alternately buried with work or terrified of being laid off. Morale plummeted, deadlines were missed, budgets blown. Few of the participants' reputations were spared.

RELUCTANCE OR REFUSAL TO USE PROJECT CONTROLS: If the project's manager or business' founder is whining about the expense of a project controller--or is going out of his way to further some excuse for not creating a baseline and collecting status--run, do not walk, to the nearest exit. Some time back the "phased approach" to implementing project management rigor became popular, with the lower-risk projects avoiding many aspects of the old Cost/Schedule Control System Criterion (C/SCSC). To this day, I'm convinced that this was a cynical ploy to get contractors to reveal project difficulties: If a project tried to avoid the cost and schedule controls, it meant they were in real trouble, and deserving of more scrutiny.

LACK OF ACCOUNTABILITY FOR PROJECT PERFORMANCE: I must confess that there is a great amount of comic value in the depths of deceitfulness that some PMs and business founders will go to in order to avoid accountability for the rotten performance of their projects and company ideas. They will tap contingency budgets to cover scope creep, process baseline change proposals to push out key milestones, or refuse to show a variance at completion for projects that have passed the 20 percent complete point. What's not funny is the amount of resources that are wasted while these idiots keep their PM/CEO/COO titles, and the way the staff is often held accountable for project failure.

STAFF AVOIDS COMMUNICATING BAD NEWS UPWARDS: This problem is occasionally caused by overly ambitious or confident staff members who believe that they can resolve any technical difficulties by themselves, and alerting higher-ups to possible problems constitutes a career-limiting move. However, in the majority of cases, it is my experience that this minefield is planted by managers and higher-ups who react to project trouble with the sole tactic of pushing the staff harder.

SCHEDULE DEADLINES ARE SET AT THE HIGHEST LEVELS OF MANAGEMENT: (i.e. By those who won't be doing the actual work) Most PMs will agree that activity-based costing is a good idea, so why hasn't activity-based scheduling become more prevalent? The practice of having executives set completion dates, often on an extraordinarily arbitrary fashion, is a guaranteed schedule-wrecker, and a business launch or project whose schedule is not properly managed is a project headed for disaster.

If you find yourself in a project that is displaying one or more of these symptoms, try to make a discreet exit.
"You just slip out the back, Jack
Make a new plan, Stan
You don't need to be coy, Roy
Just get yourself free"

The Scariness of Taking Chances

(or, Better the Devil You Know than the One You Don't)

So many "wanna be" entrepreneurs I talk to have a real drive and longingness to leave the cubicle confines and strike out on their own. But, within 2 minutes of sitting down with them, I can pinpoint with 99% accuracy whether they'll put a stake in the ground and be a raging success or never get off square one.

WHY don't they leave? Here's the top three reasons:

1. STATUS-- I don't care if you detest every day you enter the office. If your business card says "Jane Doe, Vice President of Business Development, IBM" you carry a lot of weight in our society. Try explaining to your mother why you would give up a six-figure salary with a well-known company to try your hand at starting a faux-finish painting business. It may feed your soul, but will it impress your neighbors?

2. ROUTINE-- You may have a comfortable routine that includes a stop at your favorite cafe to get a latte in the morning, or a workout in the gym next to your office at lunchtime. Even if you work long hours, your body is accustomed to a familiar routine and will resist any change, regardless if it is good for you or not. If you are married with kids, you may have a carefully choreographed dance between you and your spouse for who gets the kids ready, drops them at school, drives them to various activities or gets them ready for bed. When you start your business, you will not have a predictable schedule and this can wreak havoc on your family life.

3. RECOGNITION FOR YOUR EXPERTISE-- If you have been working for a good number of years in a corporate setting, most likely you have developed some great skills and have a breadth of experience in your field. Peers recognize your expertise, and even partners and vendors acknowledge that you know what you are talking about. If you were to chuck all this for a new, untried venture, you would put yourself back to a beginner stage where you feel incompetent in what you are doing. A few people enjoy this feeling. Most people hate it.

Like the lyrics in Celine Dion's new song, "Taking Chances"

But what do you say to taking chances,
What do you say to jumping off the edge?
Never knowing if there’s solid ground below
A hand to hold,
Or hell to pay,
What do you say?

No More Blues!

Sorry, folks. I just realized that every topic this week has had a negative and/or "blues-y" slant. NO MORE!

I had the most amazing meeting yesterday with a woman that I truly admire and respect. She has been an executive life coach for over a decade and has done very well for herself. However, as she has grown her practice over the years, she's found herself trying to conform to the corporate, stiff structure of training leadership, ethics, and goals. It just hasn't been her.

I've been mulling her brand in my mind for months; what she has meant to me and how special I know she has been to others she has coached. I kept coming back to the same word... "MAMA." She is Mama Judy. She gives love and nurturing and milk and cookies for the soul. She can build an empire on this position. No one else has it. Dr. Phil is "DADDY" and I look forward to helping Miss Judy become the nation's Mama.

This morning the first phone call I received was from her... thanking me for being a shining light to her, revealing her true destiny/business calling, and valuing her relationship with me and respect for me. Wow... does life get any better?

Business Branding and the Budget Blues

Branding is as important in business markets as in consumer markets. Business buyers, however, look for a different set of brand values. They ask what a product or service can do for their business.

If your budget is limited, product message are more likely to generate short-term revenue. That could increase your marketing budget over time through new customer acquisition. However, it would be wrong to neglect brand-building messages completely. You would be sacrificing long-term business development and customer retention.

Traditionally, branding has been seen as a consumer marketing discipline. Business marketing was seen as different; buyers were assumed to be rational and decisions were believed to depend primarily on price and performance. However, research has shown that business purchase decisions are more complex, and companies base their decisions on a variety of factors. Business-to-business companies ignore branding at their peril.

The Blue Chip Blues

The biggest challenge facing entrepreneurs is hiring and retaining great people, and it’s only going to get worse as the boomers retire and there aren’t enough qualified people around to fill their shoes.

Okay, you knew that already. But my experience suggests something you might not know: it takes a special breed of employee to thrive in an entrepreneurial environment. It’s a fact of business life that most employees fare better in—if not prefer—the confines of the corporation. In a large environment, reporting hierarchies and duplication of roles mean that staff can make meaningful contributions to the company’s success when working within the limits of detailed job descriptions, constant managerial oversight and endless bureaucracy.

That’s not the case at entrepreneurial firms, typically startup or fast-growing enterprises whose hallmarks are a lack of structure, a shortage of human and financial resources, and frequent changes in direction. What these firms need are staff who can succeed despite the turbulence of the entrepreneurial environment. Many business owners figure this out the hard way, only after hiring and firing corporate types who can’t get with the program.

The qualities you want:

1. Resourcefulness. Entrepreneurs rarely have the infrastructure, resources or information needed to achieve their goals. They need employees who can make do with what they have.

2. Take-charge attitude. Entrepreneurs running fast-growth companies must delegate to their employees—often junior people—but can’t do much hand-holding after that. Thus, the ideal employees are self-starters.

3. Unending energy. Entrepreneurial firms cannot afford to have a 9-to-5 culture. Their ideal employee has loads of enthusiasm and energy and consistently generates better than expected output.

4. Growth potential. Entrepreneurial companies are like a human-resources vacuum—there are always leadership roles to fill. The best staff are willing to accept higher levels of responsibility than one might expect from someone with their position, title, experience level or salary.

5. Multi-tasking ability. Fast growth means few entrepreneurial enterprises can afford to pigeonhole employees in narrow job descriptions. They have the ability to perform multiple roles.

Unlike big companies, entrepreneurial businesses can provide opportunities for employees to improve their leadership abilities, exercise their creativity and manage themselves. Sell those opportunities to prospective employees, and they’ll take a shine to your company.

Customer Disservice...

... Because we're not satisfied until you're not satisfied.

Wait... no, that didn't come out right, right? Or, did it??

Who's job is it to make sure that all the amazing spin/story/survey claims that Marketing makes are true? Do customers want to know the truth, really??

hmmm...

Ready... FIRE! Aim...

Ahhh... contemplation constipation. I see it all the time. Entrepreneurs who just can't make a solid decision, put a stake in the ground, and pull the trigger.

I do believe one of the most (if not THE most) important trait a business founder can have is decisiveness. AVOID BEING A PERFECTIONIST.

In the Malaysian culture, only the gods are considered capable of producing anything perfect. Whenever something is made, a flaw is left on purpose so the gods will not be offended. Yes, some things need to be closer to perfect than others, but perfectionism (paying unnecessary attention to detail) can be a form of procrastination.

Get on with it! The world needs your genius turned into a solution. Here... I'll take the safety off for you.

Profit from Scarcity

from Harvard Business School professor, John Quelch:

Marketers are trained to match supply to demand. Everything that consumers need should be available at the right time in the right place at the right price. Coca-Cola's mantra always has been to be within an arm's reach of desire. To be out of stock is to lose a sale or, worse, to lose a sale to a competitor.

But marketers also understand that, by using the illusion of scarcity, they can accelerate demand. This false scarcity encourages us to buy sooner and perhaps to buy more than normal.

We saw two excellent examples of this effect this summer with the launches of the iPhone and the seventh Harry Potter book. In both cases, the pre-launch publicity was designed not only to fuel demand but also to create the illusion that supplies would be limited. In fact, there were very few supply shortages. In both cases, the marketers anticipated demand levels pretty well.

As the mountains of press coverage and strong opening day sales attest, the scarcity illusion strategy paid off for Apple and Potter's publishing company. It wasn't just direct sales of these two products that benefited from the scarcity illusion, however: The heavy crowds drove sales of related products in Apple stores and bookstores during a relatively slow sales month.

But there are risks to using false scarcity as a strategy. First, hype invites heightened scrutiny: Common first-version shortcomings of the iPhone fueled negative reviews that were then amplified by the blogosphere. Second, some consumers, frustrated by waiting in line, may have given up or switched to other alternatives.

Creating the illusion of scarcity can be a smart marketing strategy. And even if you're in the unfortunate position of experiencing very real scarcity, there are tactics you can employ to minimize the brand damage and even profit from the error.

What's your scarcity story? Has your company been caught flatfooted in a scarcity situation or has it successfully manufactured the illusion of scarcity to accelerate demand?

Because CEOs know their business, but...

... they usually don't know how to brand it.

"Over-Doing" Yesterday's Advice

The Marketplace and Marketing in the 21st Century

Are you still doing business like you're in the Industrial Era? Please join the Information Age immediately.

THEN-- Certainty, quiet times
NOW-- Ambiguity, crazy times

THEN-- We deliver good, reliable products that work for the client
NOW-- We create awesome experiences leaving an unforgettable memory.

THEN-- Procedure-driven / product oriented
NOW-- Client-centric experience

THEN-- Satisfies a need, "I'm glad I bought it."
NOW-- Fulfills a dream: "I want more!"

THEN-- Advertisement, commercials
NOW-- Word of mouth, referrals

THEN-- Analyze data and present facts / figures
NOW-- Tell a story and engage the heart

THEN-- Product design is efficient, complex, and clumsy
NOW-- Product design is elegant, simple, and graceful

THEN-- Competition, rivalry, race
NOW-- Collaboration, friendship, teamwork

Move along... There's nothing to see here (OR, Why your company doesn't deserve press)

Here are the common characteristics of why you're not making any news.

1. Product too hard (or boring) to explain: For most business press reporters, if they can’t quickly understand what the product is, they assume that their readers aren’t going to understand it or care either. If your company is bad at succinctly describing what business you're in, your current appeal as a business press story is approximately zero.

2. Same tired story as every other competitor you have has pitched to the media: There are certain story angles that have been exploited to such an extent that anything that bears a resemblance to them will be promptly dismissed by the weary business press reporter. From "rockstar executives" to "disruptive technologies" - there is a very long list of cliches / associations that do your chances way more harm than good when you bring them "out of the box" in a "Web 2.0" kinda way. ugh.

3. Spokesperson just doesn't have "it": Few companies have magnetic personalities speaking on their behalf. Great storytelling ability, sincerity and sense of humor are among the characteristics that I’ve seen that seem to separate the really good spokespersons from the other 99.99%. People often don’t realize that whether or not the reporter actually likes the person they’re speaking with may be the single greatest determining factor in whether the story gets written or not. But when the spokesperson has “it,” the odds of being covered by business press increase exponentially.

4. Lack of credibility: There are certainly exceptions, but most reporters are not willing to stake their personal reputation on a glowing article about a company unless there is solid evidence that it is headed in a positive direction. Most businesses (and senior management teams) don’t realize the amount of triage that goes on within business publications in terms of allocating the relatively scarce print space (the amount of selling that many business press reporters have to do internally to get their ideas signed off on … the number of stories that make it far into the eval process, but ultimately die on the gurney, etc.). Getting conned by an undeserving company and writing an undeserved piece about that company is especially damning to a business press reporter’s reputation.

So, make sure that your C-level team understands that while yes, your company is amazing, it may not be the next biggest thing since Berkshire Hathaway.

"Sorry, bud, your lips move, but I can't hear what you're saying."