Tuesday, October 30, 2007

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?

Monday, October 29, 2007

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,


Friday, October 26, 2007

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.

Thursday, October 25, 2007

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...

Wednesday, October 24, 2007

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.

Tuesday, October 23, 2007

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

Monday, October 22, 2007

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.

Friday, October 19, 2007

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)

Thursday, October 18, 2007

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.

Wednesday, October 17, 2007

Tuesday, October 16, 2007

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.

Monday, October 15, 2007

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!

Friday, October 12, 2007

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.

Wednesday, October 10, 2007

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.

Tuesday, October 9, 2007

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.

Monday, October 8, 2007

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

Friday, October 5, 2007

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.

Thursday, October 4, 2007

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

Wednesday, October 3, 2007

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.

Tuesday, October 2, 2007

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.

Monday, October 1, 2007

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"