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Entries in Marketing (16)

Friday
Feb142014

The Slowest Way to Go Out of Business

Friday afternoon. I was catching a connecting flight back home from an airport in the middle of nowhere. The airport lounge was almost deserted. Not a soul as far as the eyes can see.

Finding out that my connecting flight was delayed by 3 hours, I loosened my tie, picked up the novel I had in my briefcase and started reading it. 

The woman who walked through the doors was in her late 40’s. She seemed a bit intense but was friendly, perhaps because she also had 3 hours to kill at that deserted airport. She smiled and said “hello” as she took the seat next to mine. We started chatting. Soon, I was surprised to find out that she was the woman I had tried to get hold of many times from list of prospects I was calling. She was the majority partner in a successful, mid-size law firm with about 40 lawyers and over 100 employees. And I had her all to myself for the next 3 hours! 

Image: Sheep herd in Ede, Holland. Is your business built around your unique identity? Click on the image to take Business Health Check, AQ. For the next 2 hours, she talked and I listened. As we began to get into some of the technology issues that her firm faced, I started asking some questions about their Information Technology investments.

One thing led to another and we decided that it made sense to draw up a preliminary contract to implement a software package I was representing. When I mentioned the price-tag, $200,000 over the term of 2 years, she didn’t even flinch. When I showed her the contract that I always carried in my briefcase, she said, “Where do I sign?” (”Is she really a lawyer?” I remember thinking to myself.)

“Here,” I said, pointing to the “X.” Then it happened. She said something that caught me completely off-guard. She didn’t have a pen. “Do you have a pen?” she asked. In a moment of panic, I realized that I did not have a pen with me either. 

I looked around. There was only one store at the airport, a news-stand with a built-in coffee shop. I walked over and asked the store-keeper if I could buy a pen. “Sure,” he said and pointed to a cup with some pens stuck in it. Nothing fancy, just your regular “BIC” brand pens that you could buy at a local Target for 50 cents each. Each pen had a white price-tag tied to it with some hand-written numbers. I looked at the price tag. $5 each!!

“You must be kidding me,” I mumbled under my breadth and, without missing a bit, handed him the credit card. Once I had the pen, I went back to my prospective client, joked about being glad that we were at a deserted airport otherwise she would be gone and asked her if she still wanted to sign the contract. She laughed, took the pen and signed the contract.

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Monopoly vs Commodity

Let me ask you a question: Would you have paid 10 times its “fair value” for an object, a pen in this case, because it was key to getting something that was 40,000 times what you paid for it? Of course, you would.

The next question is: Did the store-owner “price-gauge” me? Being a capitalist that I am, I would say, absolutely not. He provided what I needed, when I needed it, at the price I could afford and to solve a problem that would have cost me many multiples of what the pen cost. There is a good chance that I would have paid $50 or even $500 for that pen if I had to. 

At that store, in that situation, the store owner had a monopoly on pens. Because he had that monopoly, he dictated the terms of the contract and would be able to charge me the price he wanted to charge me. 

Now, think about the situation above but with a twist. Pretend that there were two stores side by side and the second store sold the same pen for $2. There is a good chance that I would have bought my pen from the second store, provided that the store-keeper delivered the one thing in this case that was most important to me: Speed. 

If the second store was selling the pen for $2 but was unmanned and I had to ring the bell and wait for someone to show up, I still would have gone to the first store and paid $5 for the pen. However, if the first store was selling the pen for $50 and the second for $2, I would have perhaps gone through a little bit of discomfort to buy the cheaper pen. 

If both of them sold their pens for a very high price, say $50, I may have even gone to one store and tried to lower their price - bargained - by threatening to go to the other store if he didn’t lower his price. 

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Is Slow Death Better than Quick Death?

Coming to the main point of this article. The way to die a slow and painful death in business is to be exactly like your competition, so much so that your prospective clients can’t decide why - and why not - to choose you over your competition. When your product or service is so similar to your competition’s that they can’t tell you apart from other similar products or services, your products and services have become a commodity in the marketplace. 

If you are exactly like your competition, one of you is not needed in the marketplace. And the marketplace will find a way to weed out those who are not needed. This “weeding process” is not pretty. Businesses fight hair-and-nail in that marketplace until a winner emerges. The rest have to fold their tents and go home or - worse - hang by their nails as long as they can, which is probably worse than quickly going out of business.

At the end of this weeding process, the successful business would have figured why they remained standing still - what was their Meaningful Difference - and then build the next phase of their success deliberately around that Meaningful Difference. 

But such success does not have to be accidental. A business can deliberately choose to build their business around a meaningful difference at any time and avoid having to live through the stressful experience of being a commodity provider in the marketplace. 

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Pricing Pressures

Back to you. Think about your business. Under what situations and circumstances would you have a monopoly for one of the products your business offers? Remember, no matter how “commodity” your product or service may be, it can’t get any more “commodity” than a pen. Any business, and I do mean any business, can find situations in marketplace where it’s more of a monopoly than a commodity. 

One of the most deadly side-effect of for a business to be a commodity presence in the marketplace is that they get price-shopped by their prospective clients. This happens because businesses don’t do a good job of positioning themselves as a monopoly or a near-monopoly in their chosen sub-set of the marketplace. 

Ultimately, there is only one reason why there are pricing pressures: You are perceived as a commodity in the marketplace. In other words, your products and services are perceived as exactly like those offered by your competition. Another way to look at it is that the perceived value of working with you is not higher than either doing it themselves or hiring your competition. 

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The Foundation of a Long-Lasting Business

The good news is that you don’t always have to overhaul your entire product or service offerings to prove your value-add and stand out in the marketplace. After all, the fact that you have been successful thus far shows that value-add exists. In most cases, it’s just a matter of communicating your value-add to the potential customer in a way that she finds valuable. 

It does require, however, that you know your products and services from three angles:
  1. What is it that your customer gets by doing business with you in concrete, specific terms?
  2. Why should they believe that you can deliver this value-add (and not your competition). 
  3. What makes you different from the other options that your customer has in getting this value. In other words, what’s your meaningful difference?
The better you can answer these questions, the clearer you are about your unique identity in the marketplace. The clearer you are about your unique identity, the better positioned you are to build a successful, long-lasting business.

Here’s an article I wrote that helps you go through this process step-by-step. 

Is your business built around your unique identity? You can find out here by taking Business Health Check AQ. It’s free and comes with a strategy guide to help leverage your strengths and compensate for your weaknesses. 

Copyright 2014 Bhavesh Naik. All rights reserved.

Bhavesh Naik is the Founder and Creative Director of Awayre, LLC, a management consulting and human resource development firm specializing in activating the hidden power of a business process by engaging its people’s awareness. Awayre, LLC is a pioneer in bringing human awareness to the field of management and human resource development as its structural and fundamental component.
Tuesday
Aug162011

Business Lessons from 2012 Presidential Primaries

Is Mitt Romney in Trouble?

I don’t know if you know, but I don’t watch much TV. I especially shun all forms of live news, because I don’t want to get drawn into those infinite news cycles with their never-ending stories.

I love presidential politics, however. That’s why this past weekend I stuck my head out of my no-news cocoon just long enough to steal a glance at the political scene.

There are many parallels between presidential elections and business. (There are differences too, but that’s a topic for another day.) I first wrote about this in early 2008, during the democratic presidential primaries and again after the election in late 2008.

I want to be ahead of the curve this time and put those lessons to test. After all, what good is a theory if does not help forecast the future?

My initial read is that Mitt Romney’s campaign may be in serious trouble for these three reasons: 1) he has a weak message, 2) his delivery of that message is inauthentic and uninspiring and 3) two of his opponents have much stronger messages and can deliver them with more passion and conviction.

1) Weak message

You may remember that there are three ingredients - 3 M’s - that a presidential election, and a business, must have in place for it to be successful. These three ingredients are 1) Message, 2) Man/Woman Power, and 3) Money.

The most important of the three is Message. In other words, if the message is strong, it will attract people and money. But a weak message cannot be overcome by large amounts of money or the people behind the campaign.

A good message has three components: 1) What you would get if I was elected 2) Why you should believe that I can deliver that promise, and 3) Why I am the best option to deliver that promise over my competitors.  

The business corollary is: 1) What you would get if you bought our products or services, 2) Why you should believe that my business and I can deliver on the promise and 3) Why my business and I are the best option for you to have the above things delivered.

The stronger, more specific and more detailed the answers, the stronger the overall message. The better the narrative, the story and the personification of the message by the person delivering it, the more logical and emotional connection it creates with people.

Mr. Romney’s message is weak on the first component and questionable on the second one. It was quite strong on the third component until last weekend, when Rick Perry entered the race.

2) Inauthentic, uninspiring personification of the message

The messenger is at least as important as the message, perhaps more. The messenger, whether it is the presidential candidate, the business owner or a sales person working for a business, must personify the message, and connect through the message with the hearts and minds of people, not just relay the message handed down to her.

When a message is not true to the messenger, people see through it and we are perceived as inauthentic and insincere, even phony.

Mr. Romney looks and feels like a slick salesperson who will say what you want to hear to get the sale. He comes across as inauthentic even though we know that he has most of the right credentials for the job.

3) Opponents with authentic messages and inspiring delivery

Politics, as business, is a competitive game. To win, you don’t have to be perfect, just better than the competition. As long as the competition is weak and you are strong, you are assured a victory. But when you have a competition that is stronger, you have to work harder.

Michele Bachmann, while regarded by pundits as not having a broad-based appeal, has one thing that Mr. Romney does not have, and will probably never have, an authentic message that is true to her convictions and resonates with a strong base of supporters, however small in numbers.

Rick Perry has an authentic message, an engaging, passionate delivery that comes from his deep conviction to his message and a resume that backs up the primary claim of his message: job creation.

Lessons from the past

Mr. Romney’s campaign reminds me of Hillary Clinton’s in the summer of 2007. She, like Mr. Romney, had people and money in place but lacked the most crucial thing: an authentic message that deeply resonates and causes a movement around the candidate.

What to do?

Can Mitt Romney fix his message? Certainly, if he chose to buckle down and go through some intense, honest self-analysis, first by himself and then with his advisors.

Is he likely to do it? No. Why? Because it’s not in his nature. In other words, self-analysis does not come to him very naturally. If it was his nature, he would have done it by now. If he did not do in the last four years, when the pressure was off, he is unlikely to do it now when the pressure is on and getting more intense by the minute. I don’t see how his campaign people would let him ease off his busy schedule and allow him to lock himself up in a room for some hours every day so that he can truly figure out what he is all about. More importantly, I don’t see how he will allow himself to do it, simply because that’s not something that he would rather do if he had a choice.

What about Barack Obama?

While we are on the subject, where does Barack Obama fit into all this? Well, he has the same problem that Mitt Romney has and Hillary Clinton had in 2007: A lot of money, a great team, but a weak message.

What I find interesting is that what was Mr. Obama’s biggest strength in 2007 and 2008 is now his biggest weakness. In 2008, his message resonated with hundreds of millions of people and caused a movement around him that ultimately put him in the White House. This time around, a consistent message has been almost non-existent from the Obama Campaign.

If there was one thing that he can do for his reelection campaign right now, it would be to buckle down and hone his message.

Would he do it? I think that Mr. Obama is more likely to do it than Mr. Romney. Why? Again, because self-analysis comes to him naturally. In fact, being contemplative is probably one of his very basic needs. He may have even carved out enough mental space to allow him the opportunity to reflect, even in midst of his grueling schedule as the president. Also, the fact that he did it so effectively in the last election should give him plenty of confidence that that’s where he needs to focus his attention.

Here is some unabashed, and unsolicited, advise for Mr. Obama’s campaign.

To have an effective message, Mr. Obama needs to look for one thing that American people care about the most and make it a corner-stone of his campaign. A good bet is the economy. Then he needs to paint a clear picture of what he expects things to look like in 5 years in that area and what it will mean to Americans. Then he needs to lay out specific steps that his administration has already taken in the direction of that vision and those that they will continue to take if he is reelected. In other words, he needs to layout a logical, step-by-step path to recovery that would have been followed by his administration all along and will continue to follow after the reelection.

He also needs to emphatically and unequivocally point out all the mistakes that he thinks he has made, which will allow him to also lay blame on others where appropriate and claim credit for the things that his administration did get right. In other words, he needs to be ruthlessly honest, authentic and direct. Lastly, he needs to lay out a case for why he believes that reelecting him, and not his opponent, is the right choice for the American people.

Would it guarantee his victory? No. Could it generate a new sense of enthusiasm around him? If done right, yes. One thing is certain though, without a strong message, Mr. Obama will have to rely on a weak opponent, and that’s not a good place for him to be right now.

What about you?

Whether you are a business owner, a business leader, a worker-bee in the corporate world, a social organizer or a householder, you have a personal brand. A question you might want to ask yourself is: How do people perceive me?

  • Are you perceived as an authentic human being or a slick salesman?
  • Are people engaging with you in meaningful conversations or are they avoiding you?
  • Is there a passionate movement around you, however small, of excited well-wishers, including clients and prospects or are you surrounded by people who are indifferent to you and your message?


I have written quite a bit about the process of creating an authentic message for you and your business, products or services. Read more here: Want to Jump Start Your Sales? STOP Marketing!

Need help? At Awayre, LLC, we help businesses carve out an authentic message based on their unique strengths and weaknesses, a message that resonates in the marketplace and helps them create an engaged community of people who are eager to do business with them. For more, information contact me at bhavesh@awayre.com.

Tuesday
Nov202007

TRUE or FALSE (For Your Business): “Our marketing material inspires me.”

What happens when our Marketing Materials - the website, the flyers, the brochures, the leave-behinds - do not inspire us?

Well, think of it this way, if our own marketing material does not inspire us - moves us emotionally - what are the chances that they will inspire our prospective clients?

The faculty us humans have been given to make decisions is not intellect; it’s emotion. We make buying decisions emotionally and justify them intellectually.

If our marketing materials don’t inspire us, the probability that our prospects  will do business with us goes down - dramatically.

Click to read more ...