The Profit Prophet

I read an article some time ago by Seth Godin about Power and Organization . In that blog, Mr. Godin claims that most power occurs because one side is better organized than the other. Labor is usually less well organized than management, criminals are usually less well organized than the police and customers are always less well organized than producers. I have to agree with the assessment, and actually say that in order for any organization or company to be successful, they need to be better organized than their competition. In a real world case, look and the meteoric rise of Barack Obama from State Senator, to U.S. Senator, to President elect. Obama was better organized than Hillary Clinton, and better organized than John McCain. In essence, his "community service" background allow him to tap the Internet, word-of-mouth, multi-level-marketing, and good old fashioned canvassing to develop a grassroots movement that turned into a ground swell and eventually a movement ...

There is an excellent tale, by American poet John Godfrey Saxe (1816-1887),  that is based on a fable told in India many years ago. It is a good warning about how our sensory perceptions can lead to some serious misinterpretations; especially when we focus on one part in relationship to the whole.  It also deals with how people perceive things from where THEY stand not from were YOU stand. The tale in entirety follows this post. While this is an excellent tale about perception, it is also a cautionary tale for anyone trying to market a product to a general population.  While you are trying to "sell" an elephant, certain features of the elephant will be more important and more pronounced than others.  So, what you as a good marketer have to do is figure out what are the most profitable market segments to sell to and then highlight those features prominently, that includes determining if someone wants the "whole" elephant.  In some instances, and if possible, ...

A few years ago, Jason Cohen posted in his blog (A Smart Bear)  "Authentic" is dead , in which he goes on to say that some words have been used so often, that they have actually lost all meaning.  Well, that got me thinking, since I help a lot of start ups, and do a lot of marketing, branding, and word-smithing along the way, I thought I would build upon Jason's observations and do my own little survey.  So, I compiled a list of 43 words (see THE LIST below) that I see used over, and over, and over again, and asked my little network of people (colleagues, friends, business partners, etc.), what they though were the most overused.  Well, 1351 people responded, and out of the list of 43, there are five that stand out as the most overused. With 1351 respondents the percentage indication is in parenthesis.  The most overused terms  include: Innovative (54.5%); Cost Effective (43.0%); Low Hanging Fruit (42.8%); Out of the Box (42.6%); and Best of Breed (41....

During my 15 years of helping start and working for start-up companies, I have learned a few things from all the mistakes I have made and from the mentors and advisors I have met and worked with. Though there are dozens of things you may have to worry about when starting a company, I will highlight the 3 Deadly Startup Sins that will pretty much guarantee your eventual failure. Leadership Actually, Leadership is the number one element in the eventual success of any new endeavor. And the number one mistake made with most start-ups is assuming that the founder or inventor should be the person running the company. History has proven this is often not the best course of action for the success of a company. Henry Ford stated that even though Thomas Edison was the smartest person he had ever met, he was a horrible businessman. I have seen far too many people, who happen to be brilliant inventors or scientist, be absolutely horrible leaders. Ever endeavor, large or small, rise...

I thought, now that the elections are behind us, and we have been inundated with thousands of hours of hyperbolic advertising, debating, and otherwise misleading statements about such and such doing this and that, I thought I would ponder why politicians (and to a large degree marketers) can seemingly be saying two different things about the same subject. Are they just liars, or is there something completely different going on? As it is often said, there are two sides to every coin, and in debating anything you should be able to equally argue for the pro or con of an idea. I think this little testimony from a Texas legislator sums it up best. In 1952, Armon M. Sweat, Jr., a member of the Texas House of Representatives, was asked about his position on whiskey. What follows is his exact answer (taken from the Political Archives of Texas): "If you mean whiskey, the devil's brew, the poison scourge, the bloody monster that defiles innocence, dethrones reason, destroys the h...

O ne thing I love is stories about how seemingly random events turn out to be huge successes. It is amazing how often these kismet moments result and macromental changes in history...and well, the following story is so evident of this randomness...but it is not randomness at all, it is the power of developing a network, even it that network is just one other person!. If you were in the market for a watch in 1880, would you know where to get one? You would go to a store, right? Well, of course you could do that, but if you wanted one that was cheaper and a bit better than most of the store watches, you went to the train station! Sound a bit funny? Why were the best watches found at the train station? The railroad company wasn't selling the watches, not at all. The telegraph operator was. Most of the time the telegraph operator was located in the railroad station because the telegraph lines followed the railroad tracks from town to town. It was usually the shortest dist...

You know, I talk a LOT about customer service and the "WOW Factor," but I wounder if anyone would go as far as this story embodies.  It is NOT only going beyond the pale of expectations, but also renews your faith in mankind!!! Sometimes…we need reminders of how awesome people are Someone in the Postal Service needs to be rewarded A letter from the Post Office... this is absolutely the best!! We don't know who replied, but there is a beautiful soul working in the dead letter department who understands something about kids and their pets… Our 14-year-old dog Abbey died last month. The day after she passed away my 4-year-old daughter Meredith was crying and talking about how much she missed Abbey. She asked if we could write a letter to God so that when Abbey got to heaven, God would recognize her. I told her that I thought that we could, so she dictated these words: ---- Dear God, Will you please take care of my dog? Abbey died yesterday and is with you in heaven. I miss h...

I wrote a blog post about a year ago titled " The Moldy Middle " which went into detail about how companies that target the statistical "mean" are doomed to fail primarily because they try to be all things to all people, and end up becoming irrelevant to anybody. Recently, Seth Godin posted a blog about this subject entitled " The paradox of the middle of the market ." In this blog, Mr. Godin actually says it is OK to seek out the middle because he believes that this is where "profits meet scale." Now, Seth might be right for a short period of time, but over the long haul all the things that he lists will come to saturate a organization and eventually paralyze its ability to respond to any changes in the market. I respect Mr. Godin immeasurably, but find it hard to believe that he still believes that there is a monolithic "mass market" of middle of the road anything. Oh how the old ways die hard even with enlightened individuals. New...

One of my colleagues, Patti Hill , former CEO of PR Firm Blabbermouth, and now PenmanPR, asked the question about the value of having "nano" inside. She points out that the consumer marketplace has become rich with nanotechnology-based or enhanced products from sunscreens to water repellent and stain-resistant clothing, gum, car wax, sporting equipment, heat-resistant windshields, consumer electronics, and nanoparticle-laden cosmetics. Do consumers really care? This goes to the heart of what I always talk about: technology v. benefits. Having "nano" means nothing unless there are concrete benefits of having nano technology. Also, nano has become so generic (like quality, value, etc.), that it really does not mean anything anymore. Now, if you are using nano-technology to improve something, or invent something new, it could be considered beneficial (ie. WiFi capable printers). The big mistake that technology companies always make is assuming peop...

Please forgive me, but this was written in November of 2008, but is still true today. It tells of how marketing can make the difference of failure and success in a presidential election. I hope you will head the lessons learned in your marketing plans. So, like it or not, marketing your message is really, really, important.   Now that I have had a little time to digest what just happened in this historic Presidential race, I cannot help but notice how much marketing and messaging played in selecting our 44th President. I am not saying that the organizational skills, enthusiasm, and funding did not help. They most certainly did. But what was the catalyst that got all that good stuff going for Barack Obama? It was marketing and messaging. Maybe the best candidate did not win. Maybe McCain was more qualified, had more experience, and was more centrist. But it was Obama who was better able to determine what Americans perceived of this abilities than McCain. The difference ...

I have been fortunate to be helping two startups over the past few months. I think both of these startups have a great chance because they are combining two disparate things into a new service or product. One thing that I have noticed about successful companies (both startups and giants), is that those which tend to be successful employ the “Power of ‘AND’.” This means they take traditionally mutually exclusive characteristics and then combine them into a new and novel way. Examples include Southwest Airlines (low cost fares with on-time, high quality service), Wal-Mart (low prices with large selection), and Apple (high technology with high styling) to name a few. That is not to say that companies that do not use the 'power of and' are not successful, it just seems like the odds for success tend to tilt towards people and companies who can pull this feat off. Ronald Reagan was able to combine a forceful, “hawkish” leadership, with the everyman personal touch. So...

Marketing is mostly about perception, and that perception, good or bad, is developed by the quality of a product, the company’s innovation, price and ability to serve its clientele. So when all things are considered equal quality, pricing, workmanship, etc. , a company’s image is enhanced essentially by how it treats its customers. Nordstrom’s is renowned for its customer service, often going far beyond expectations. A friend of mine reminded me recently about a scene in the movie Mr. Mom where Teri Garr proposed a give back from the tuna fish company. Yes, that was fictional Hollywood. Still, image a CEO of a large American oil company getting on TV and saying that 'we understand that America is hurting, and we have just recorded record profits, and to show our gratitude, we would like to rebate our loyal credit card customers who have been with us throughout the years with a 10% rebate?' Yes, this may cost a few hundred million dollars in cost, but as they say “the goodwill...

One thing I have found out is that your first idea about a product or service is usually not your best idea. As a general rule, be prepared to change your original idea in order to hit the moving target you planned on hitting. Some notables on this rule are Intel: It started out as a memory company, and its original numeric processor was made for factory automation, not the PC. Motorola: started out making radios receivers for automobiles. MCI: It started out as a radio network for truckers. Google: It started just looking up the number references to a particular thesis. Part of the reason why this happens is because when you start your product or company, you are only guessing what your potential customer might want or need, or how they will use a product. When you first release your product or service, you are trying to solve a problem or fill a need that you think needs to be solved or filled. Your perception of that need might not be totally accurate, or the need mig...

Once, I was asked to help an existing company recruit some sales help by their VP of Sales and Marketing. They needed someone who could grow a new software product they were developing, and who had both a technical expertise and business savvy about them. We had narrowed down the field to two people. One guy was in his forties, and had a 15-year track record of substantial sales and marketing experience and success. He actually was an electrical engineer, who during his career had migrated into sales and marketing. He understood the product perfectly, and both the VP and I felt that he would be an excellent fit. He was driven, self-assured, personable, and hungry. The other candidate had just graduated from a pretty prestigious MBA B-School program, but did not have any direct selling experience. He did know all the latest buzzwords and jargon, and was very knowledgeable on all the latest strategies in selling. I felt that while this guy was personable and knowledgeable, h...

I promised that I would try to give some practical advice on how to improve your business in simple to understand concepts and ideas. One of the most pressings issues for any company is how to increase sales profitably with the least amount of effort, or something I call 'Return on Effort.' Most people believe that the best way to grow a company is to either get your existing customers to purchase more or to get them to tell their friends and acquaintances to purchase from you. While repeat business is much easier the get than new business, and referrals can help you grow, you are at best looking at incremental gains. It is like fishing in the same pond trying to catch different fish. What most companies would like are macromental gains and in sales and profits. In order to get to the lofty goals, you are going to have to abandon some old held beliefs, and move far enough away from the safe harbor so as to no longer see the shore. First, I have to diagram what I am talki...

Someone once quipped that you can learn everything you need to know about marketing in a day, but it will take you a lifetime to master. I could not agree with this statement more. Most people see a portion of what they think marketing entails, and conclude that they understand how to market their product or service. Most people erroneously see marketing as either public relations, advertising, or product packaging or a combination of all of these. What they fail to realize is that marketing is some much more than anyone of this tactical objectives. Marketing’s real objectives include reducing the friction in sales, improving brand awareness, and maximize your return on effort of promoting your products or services. (look for another blog on what return on effort means). Marketing’s ultimate goal is to create a plan of action and to ACT on that plan. If conducting business is very much like warfare (see Sun Tzu's “ The Art of War ”), then marketing is res...

Recently, I returned from a trip to Washington D.C. with my 15 year old son Jordan. It was amazing to see how many incredible individuals have gone before us to make this the greatest country in the world. As I was able to take in all of these individuals, a repeating pattern began to emerge. What really made these individuals great was the central fact that they believed with all their being extending freedom and choice to ALL individuals. After this eureka moment, I then started to realize that these are the same two reasons why some companies are successful in good times and bad. Two cases in point: Southwest Airlines and JetBlue. Southwest’s motto is “ Your are free to move about the country ,” and they have always tried to be the no frills people centric airline. Yes, they did not have first class, but they gave the customers what they wanted (freedom) and choice of low cost fares. JetBlue also realized that Southwest was leaving open the “high-end” choice segment, so they ...

When you think of great brands what comes to mind? Starbucks? Apple? Nike? Coke? Mercedes? Hermes? Everybody talks about wanting a great brand, but so few people understand what actually makes a good brand.   First, what is a brand? A brand is what speaks to a consumer when there is no one there to speak for it. Essentially, a good brand is your ever-present salesman. It is the voice inside a customer’s head that tells it that is a good / valuable / well built / sporty / classy / etc. product or service. A poor brand will do nothing but make your potential customers look for your competition. It is an absolute fallacy to think that all you need for a great brand is a cool or catchy name, or that endorsements “make” your brand, or that technology can sell your brand. First and foremost, you have to have either a product or service that delivers on the promise of your brand. And now the hard part, what is your brand’s promise? What is the story behind whatever it is you are ...

Wow, this is a question we all ask, but are not sure why we do it. I am starting this blog for two reasons: 1) Is to impart some (albeit small) amount of wisdom that I learned during my 20 odd years as an engineer, marketeer, salesman, in operations, and business development; 2) To attract other liked-minded individuals to this blog to ask questions on how to improve their business by eliminating the friction most companies have in selling their products or services. This friction is caused mostly by a total lack of strategy. As the saying goes, "In the land of the blind, the one-eyed man is king." Hopefully, my one eye can help some people out there. OK, why the profit prophet? Back when I first stared out at Texas Instruments some 25 years ago, I got the reputation of only looking at deals that involved profit margins, not gross revenues. This was so contrary to the prevailing mindset at TI, that people soon thought I would be terminated. But my boss (Jim Watson...