Archives for category: Strategy
« Older Entries
Newer Entries »

Monopolies in Developing Countries

June 25, 2014 //
0

Beyond the level of your basic human needs – clean water, food, that kind of thing – monopolies tend to be bad for the citizen.

Control and flexibility in one’s life is about choices, so when do you don’t have choices, you tend to suffer.

Perhaps the title of this post should be Monopolies in Emerging Economies, or perhaps in Not Very Densely Populated Areas, because my example for this is the west of Ireland.

Where I live we have one choice of central heating fuel, and one choice of provider of that fuel. The houses in the area were plumbed for this type of energy, and the switching costs to another type of fuel are either prohibitively high or it’s not possible to switch because the infrastructure’s not here.

When this happens, you’re a hostage to the macro ebbs and flows of global energy costs which invariably get passed onto you when the flows are not in your favour, and are slow to come back to you when they are. Hate that :-(.

 

Tags , ,
Categories General, Strategy

The Perils of Reverse Segmentation

June 16, 2014 //
0

When we look back on our lives or our careers and contemplate some of the decisions we made that didn’t go according to plan, we have a tendency to rationalise them and explain them away. It makes us feel better. “Yep, that didn’t work out, but at least I know that industry’s not for me.” “Shouldn’t have bought that car, I’ll put that down to a learning experience.”

I use this ‘backward justification’ approach myself, by reasoning that every decision we make in life is a good one. It was good for some reasons, not good for others, and at least it was better than not making a decision at all, wasting precious time stuck in a rut. It’s better to have been proactive and have thought through the permutations and ramifications before deciding, but sometimes you just have to go.

In the marketing context this back-to-front way of thinking is similar to what we call ‘reverse segmentation’, and in business it can be very costly indeed. Segmentation is of course a really important part of plotting your own brand of world domination. It’s part of the ‘S-T-P’ holy trinity of marketing, namely segmentation, targeting, positioning. You segment your defined market, choose the segment or segments you want to target, and present yourself in the best light to those chosen segments.

How you segment is the $64,000 question. According to what criteria do you segment? If you’re going to segment along two key axes and plot your market or audience on a matrix, you had better get the two key criteria right, otherwise you might as well segment according to favourite type of pop music and preferred colour of pyjamas – unless you’re in the musical pyjama business. Lots of businesses, however, are not market-focused. They’re generally product focused. They develop a product which they think is great, then they try and find a market for it. This is also called a solution looking for a problem.

When you already have your product, it’s really hard to come up with objective segmentation criteria that don’t play directly to your strengths. This, dear reader, is reverse segmentation, and you might as well put your cart in front of your horse. It gives you an erroneous picture of where your market is heading and of your likely success. You’d be amazed how many companies do it!

Tags
Categories Customers, Marketing, Planning, Sales, Strategy, Technology

It’s All About the Why

June 13, 2014 //
0

When you learn how to write a press release, you’re taught to get the 5 W’s into the first para, because those short-attention-span journalists may not read any further if they don’t get drawn into your story. The 5 W’s are Who, What, When, Where and Why.

It’s still a great guiding principle if you write for the web, as the online world has driven all people’s attention spans down to the length of a journalist’s, with the result that someone else’s content is always a click away.

Of all the W’s, the last one is the most important. On balance, it’s the only one that really matters. The ‘why’ explains the connection.

Consider these questions in the customer context:

  • What’s in it for me?
  • Why should I care?
  • Where is my order? This is otherwise known as WISMO in ecommerce.
  • How could you pull that stunt?

Despite what you might think, these are all why questions. Your customers are not interested in the ‘how’, because that’s generally about you, and that’s not a major concern to them. They generally don’t want to know how you made the meal, or how you built the aeroplane they’re riding in, or how you came to design the software to work that way. They want to know why they’re being charged extra, why the release is late, or why they can’t have it in blue.

I was coming back from the UK the other day on a Ryanair flight. It wasn’t one of those flights in the 93% that arrive on time. It wasn’t close to being on time, it was horrendously late. In fact it was one of the 1% of their flights that was over an hour late. Now this is very unusual for Ryanair, and the first time in probably 50 flights I had been seriously delayed, but it was late on a Thursday evening, the last flight out, and I was tired and irritable.

The trouble was, Ryanair kept delaying the departure time and not saying why. Even an apologetic text to each passenger did not say why the flight was delayed, so you start getting frustrated, and these days that frustration can boil over onto social media so easily. When you trade on your punctuality and you don’t deliver punctuality, you’re a bad flight away from losing a frequent flyer, at least if they have a choice of airlines, which of course is not always the case. Monopolies and near-monopolies in small and developing countries is a topic for another post.

When we finally got into the plane, the pilot came on the intercom to apologise for the plane running 1 hour and 35 minutes late.  This was because – and ‘because’ is the corollary to the ‘why’ question as you know, dear reader – that the previous plane developed a fault that couldn’t be fixed so they had to despatch a replacement aircraft from Dublin over to the UK to bring us back to Ireland. Well, that’s fair enough, I thought, it happens from time to time, that’s pretty much unavoidable. The frustration soon dissipated after that.

But why on earth did they not come clean with the why sooner? You owe it to your customers to always be transparent and give them the why whenever you can. Early and often is the golden rule, rather like voting in corrupt countries. Your customers will continue to love you for it.

Tags
Categories Communication, Customers, Marketing, Planning, Sales, Strategy

I’m Alright Jack

May 16, 2014 //
0

Ach, how to rid ourselves of the scourge of the self-servers, people who always put themselves ahead of others! In English, we say ‘I’m alright Jack’ to refer to these kinds of undesirable people.

In Irish, we call them ‘me feiners’. Here’s a good example of someone – a pretty laconic and articulate Kiwi as it happens, using the word to describe someone else.

It doesn’t matter in what walk of life or work you’re in, the me feiner is to be avoided, shunned even. They don’t pay back, they take but don’t give, they feather their own bed. If you’re in sales or marketing, you won’t last the course if you put yourself first the whole time. Success in those spheres is based on partnership, equity, balance, equilibrium. A fair exchange of effort, investment and reward.

You may be alright Jack, but not for long.

Tags
Categories Communication, Customers, General, Language, Marketing, Planning, Sales, Strategy

Packaging Fails Can Be Terminal for Your Business

April 18, 2014 //
3

Doesn’t it drive you mad when you can’t easily open a pack of food or drink? Why don’t manufacturers of anything – especially food and drink – realise that getting at the contents before consuming is part of the customer experience, part of the product itself? They have to work harder at getting the balance right between securing the contents and providing access to them.

The packaging, as far as I’m concerned, is part of what Geoffrey Moore in Crossing the Chasm called the ‘whole product solution’. Admittedly, that book is about so-called ‘disruptive’ products, but you still have to get everything to do with your product or service right. This is something I’ve talked about before here.

If you don’t get it right, you run the risk of someone substituting your product for someone else’s. Someone else who has thought harder, and worked harder, about exactly how you are going to consume what they sell, from the moment you see it. For an old but hilarious packaging fail, have a look at this beauty and imagine yourself being the owner or captain of this business, demonstrating how easy it is to consume the product – not.

 

 

Tags , ,
Categories Customers, Marketing, Planning, Sales, Strategy

Hunters and Farmers – An Unnecessary Separation of Church and State?

March 17, 2014 //
0

The majority of sales organisations and sales people intuitively distinguish between two types of sales person and sales role. The hunter is the new business person who gets the deal with the new customer in the door and then moves on to the next. The farmer is the account manager who develops that account and nurtures the relationship.

The received wisdom is that each role is suited to a particular type of character. Some folk are suited to the rough and tumble of closing the deal, others are better at deepening the rapport.

Then there is another view, propounded principally by companies like The TAS Group who are behind the Target Account Selling methodology. They argue that the best, most strategic and most successful sales people are those who strategise on target accounts, figure out where the need is, develop the opportunity for a sale and then close the opportunity themselves.

Where do you stand on this? Are opportunity management and account management dedicated, specialised roles that should stay separate, or should they be part of a combined, more strategic role? The answer, of course, is that it depends, but I’d be interested in your views on the matter.

Tags , , ,
Categories Customers, Sales, Strategy

Luck or Karma? Planning’s Big Lie

March 14, 2014 //
0

A few years go, as a recent recruit to a sales effectiveness company, I briefed the powers that be on how I wanted to run my session. I wanted to start with a story on how it was lucky I made it to the US that day at all. I had a new smartphone and set my alarm for 6am on the Saturday, unaware that my alarm was set for weekdays and not weekends. I awoke at 6am anyway, and realised my error. In any event, the thrust of my story, I said, was that you can do all the planning you want, but sometimes you need a bit of luck.

The powers that be looked at me askance. This was not what they wanted to hear. You see, they said, the whole point of sales methodology and planning is that you remove luck from the equation. You leave nothing to chance and you control the eventualities of the sale with your ideally perfect knowledge and assessment of the situation.

That said, loads of us believe in luck, hope for luck, are counting on luck. Luck and hope may not be great strategies, but even with the best planning in the world you get the feeling that luck still has a role. That bluebird deal comes in when you thought the customer gone dark. A change of key personnel plays right into your hands, or takes the deal away from you. Sometimes you feel that stuff happens that you just can’t legislate for.

The concept of luck is an interesting one. Some folks believe in it, some don’t. There was a great Greek tragedy writer called Euripides writing about 2,500 years ago. I reckon he was better than his much vaunted peers Aeschylus – who wrote The Persians – and Sophocles – he of Oedipus the King – and only a handful of his plays like The Medea survive from the 90 or so he wrote. He believed that there was no such thing as good luck. There was either no luck, or bad luck.

I take a different view of luck from my erstwhile planning perfectionist employers. Great planning means you can allow for luck or karma, or you know what to do when the luck rolls in. As Gary Player once said: ‘The more I play, the luckier I get.’

Tags , ,
Categories Customers, Planning, Sales, Strategy

The Blurred Lines Between Sales and Marketing

March 5, 2014 //
4

[Disclosure – this blog post contains adult sexual references, though not expressed in a vulgar way, because that would be a poor show.]

I thought I’d open, dear reader, with a warning, as I’d hate to see your double espresso do a U-turn as you read this. The adult reference is not to the title of the well-known song that you will find in the subject line of this blog post (and I can imagine there might be a slightly different audience finding this post as a result) but to an analogy for the difference between sales and marketing.

The rivalry, jibes and sometimes gulfs between sales and marketing is a path so worn away with words that I hesitated before I wrote the post, yet I think my point has merit.

In the old days, you could say that marketing was like sex for 1. A mainly solitary exercise, you would be crafting strategy, messaging and plans in your own company. Sales, on the other hand, was like sex for 2. You were building a rapport with that person, listening and catering to their requirements.

The connected economy has blurred those lines almost beyond recognition. If I’m a salesperson, my B2B customers can do their research online, see how people score what I offer, without ever having to dance with me until they’re ready, and on their terms. I don’t sell to them until they’re ready to start the relationship – unless I understand how to use the same processes to guide them to me.

If I’m a marketer, while I should always have been listening to the market, I can get instantaneous feedback on what I’m putting out there and can collaborate with my customers in real time to give them what they need.

The best salespeople, marketers and customers are those that understand the leveraging power of the Internet and use it to put themselves in the shoes of the other person. That way they can relate to them more, and partner with them better.

Tags
Categories Communication, Customers, Marketing, Sales, Strategy

Announcing a New Dictionary Word – The Drummernumber

February 21, 2014 //
0

In the last of this week’s posts loosely grouped around respect – or sometimes lack of respect – for the customer, I offer you a new word. A good friend of mine recently opined over a good glass of chianti (not, I might add, a contradiction in terms), “I reckon we should add a new word to the Oxford English Dictionary. It’s the Drummernumber.”

Continuing in the best tradition of coining words after people, like malapropism and bowdlerise, these four gloriously euphonous syllables reference a certain David Drumm, erstwhile CEO of Anglo Irish Bank. As I write this, three of Mr Drumm’s colleagues are on trial for allegedly suspicious loans they made on the bank’s behalf in late 2008.

So why the connection to Mr Drumm? Well, according to a colleague of his in taped conversations between senior members of the bank which found their way into Irish national newspaper the Independent, Mr Drumm had a fondness for making up numbers, except that it was phrased in the manner of someone dextrously plucking the number out of one of the more notorious part of their anatomy.

The number in question was the amount the bank needed from the government to bail it out. The plucked number and the actual number were considerably apart. I remember from my MBA days the Japanese practice of multiplying by SIX the initial estimate of the financial cost of an incident to arrive at the more likely eventual number. This is the sort of scale we’re talking about here.

Now some of you will have heard the business joke, ‘Did you know that [insert percentage of your choice] of all statistics are made up on the spot?’ which plays with the idea that statistics help to illustrate or strengthen an argument so it’s better to make one up than not have one. The event that I refer to, however, which had major ramifications for the Irish tax payer, takes the process to a whole new level.

So, expect to see the following entry in the dictionary before too long:

“Drummernumber [drum-er-nuhm-ber] noun. 1, A number which has been made up in order to advance an argument or secure approval. Also colloquially referred to as ‘a number I picked out of my a**e’. Attributed to Mr David Drumm, former CEO, Anglo Irish Bank, q.v.'”

Who knows how the trial will turn out, but this quote-unquote that we coin here is allegedly a small episode within an allegedly colossal disrespecting of – and ultimate failing of – hundreds of thousands of tax-paying customers.

And as for Drummernumber: you heard it here first. Allegedly.

Tags
Categories Language, Strategy

It Really Is OK To Assume

February 7, 2014 //
2

Do you remember in the old days of business training? There used to be a phrase, still prevalent today, that ‘to assume makes an ass out of u and me’. We were told never to assume.

This for me is not only out of date, but it’s plain wrong. It should be consigned to the era of conforming, regimentation, uniformity. The era that’s not the era we’re in.

Life’s too short, and the business world moves too fast, for us not to assume. There is too much complexity, too many variables, too little time for us to not to do otherwise, unless we want to left behind with the also rans. And who wants to be an also ran? They have neither choice nor control.

My advice on assuming is this:

– assume, whenever you can

– the first law of management is to check your facts, so do that if it’s possible, and do it quickly and effectively

– then make assumptions around what you don’t know, based on your experience, your gut feel, and preferably both

– then make that decision quickly and confidently

Assuming helps us make quick decisions, wrong decisions, fail more quickly, and learn and improve more quickly.

Tags , , , ,
Categories Communication, Sales, Strategy
« Older Entries
Newer Entries »