Category Archives: catalyst blog

A reason to come

Near my office is a cafe that has practically no foot traffic, is almost always empty and changes hands every year or so. For each new owner the temptation is obvious – a fully fitted kitchen & cafe with low rent. There’s also a conceit – ‘I can run this business better than the last guy’.

Sadly each of the three owners I’ve met ran the cafe in exactly the same way – as a completely conventional cafe inviting passers-by to drop in for a coffee or light snack. It’s a business model that requires plentiful prospective customers and a scarcity of competition. Funnily enough, that kind of location doesn’t come with low rent.

“Build it and they will come” doesn’t apply for any business – you need to give people a good reason to visit. A reason worth stopping what they were doing, traveling at their cost to your business and giving you their hard-earned cash. If you don’t know what that reason is, your prospective customers certainly don’t.

The world outside

I was talking with a shop assistant recently – her job was not secure and her mother was worried that “at nineteen you’ll lose the only job you’ve ever had”.

Why would someone cling to a job where they sit alone in an empty store? If it appears foolish it’s because we can see possibilities for her that she can’t. But from her perspective she’s safe inside her small world – the outside world offers only fear.

The key is to realize that we’re all in the same situation – no matter how large our world, it’s all we know. You’ll never know what possibilities lie outside it unless you step out and take a look.

Perhaps the Men in Black say it best:

Short term thinking

Here’s a partial transcript of the Australian TVC for Panadol Back & Neck:

“Back pain can really get in my way. That’s why I rely on new Panadol Back & Neck. It’s active ingredient works where I need it fast so I don’t need to hold back. Panadol back and neck is my choice.”?

What’s the “active ingredient” in Panadol Back & Neck? 500mg of paracetamol. That would be the same as the Panadol that first went on sale in the UK in 1956. So what’s “new”? The name & packaging.

Head & Shoulder’s have just started advertising a “new Hair Retain for Men” shampoo product (a subject near and dear to my heart). The active ingredients? The same as normal Head & Shoulders. So what’s “new”? The name & packaging.

I can understand the need to remove consumer’s uncertainty – a consumer stands at the supermarket shelf looking for a product that solves their particular problem. If it’s back pain, they want to find a box that says ‘relieves back pain’.

And I can understand the need to promote the benefits of a product – no doubt there’s some link between scalp health and reduced hair loss that the Head and Shoulders team can point to (but seemingly not on their website). And I don’t doubt for a second that Panadol Back & Neck relieves back and neck pain.

What’s not reasonable, however, is to imply that you have a new product with remarkable benefits, when it’s the same unremarkable product that you’ve been flogging for years. In doing so these companies are purchasing a short term boost in sales by withdrawing part of the trust they have deposited with us over the years. And with this kind of behaviour, there isn’t much trust left.

Interpretation and comparison

I grew up on Sanitarium Weet-Bix for breakfast – my folks bought it because it was healthy with only 3.3% in sugars. Moreover, Sanitarium took the high moral ground in the 80s and 90s, waging war with Kellog’s Nutrigrain and others by pointing out that their high sugars content (33% for Nutrigrain) was not at all nutritious.

Since then Sanitarium have presumably decided that making money is more important than health, and have released two Weet-Bix Crunch products – Honey and Cocoa – in which the sugars content is 29.4% and 28.7% respectively. Ultimately that doesn’t bother me – it’s their brand and they can dilute it if they want to.

What does bother me, however, is that having set the brand expectation of low sugar products over many decades of commitment to that brand promise, the packaging for the 28.7% sugar Weet-Bix Crunch Cocoa tells me only how good it is:

I used to be able to trust Sanitarium to tell me what was healthy for me – I could buy any of their products without reference to the nutritional panel. Now I can’t. Now I must interpret what they say about their products, and compare the nutrional content of their products to those of other brands. And as soon as I’m forced to do that, I have no brand preference for any of the entire Sanitarium product range.

The dumbest part of this is that we’ll all find out anyway, so it can be stated upfront. Find a way to prominently state that it’s got a higher sugar content than we expect and we might buy it as a treat for our kids anyway.

Trust needs no interpretation or comparison.

Creating interest

Here’s a poster I came across in the city this week:

I love it. Imagine the fun of sharing these tic tacs with your friends – you have the disco ball, I’ll have the Kombi van.

There might be many ways to bring attention to a low-interest product – ask an artist like John Maeda to do something crazy with it, invite passionate customers to show why they love?your product – who knows. I doubt, however, that creating and advertising a?fake product that’s more interesting than your real product is the optimal method.

Secrets of success: The 4 minute version

Richard St. John gave a compelling, four minute version of his ‘Secrets of success’ course at TED in 2005:

Richard’s eight points, found by surveying 500 successful people are:

  • Passion (be driven by passion, for love not money – the money follows),
  • Work (it’s all hard work but successful people have fun),
  • Good (become very good at what you do),
  • Focus (focus on one thing),
  • Push (push yourself, push through self-doubt),
  • Serve (serve others, provide others with value),
  • Ideas (listen, observe, be curious, ask questions, problem solve, make connections), and
  • Persist (through failure, through CRAP)

Of course, one needs to beware of survivor bias – the human tendency to focus on successful people and ignore the unsuccessful. This may mean that many people follow the advice or path of the successful but fail, unnoticed by observers, preventing us from accurately assessing the risks inherent in following in the footsteps of the successful.

One thing I do know, however, is that no one became successful by being ignorant of advice, risk averse or lazy. Which brings me to the eloquent wisdom of Ted Roosevelt:

“Far better it is to dare mighty things, to win glorious triumphs, even though checkered by failure, than to rank with those poor spirits who neither enjoy much nor suffer much, because they live in that grey twilight that knows neither victory nor defeat.”

I couldn’t agree more.

The Completeness Method

I recommend Freemind, mind-mapping freeware, to everyone. I use it for:

  • brainstorming – alone, in a team or with clients,
  • planning – business, documents, presentations, this blog, and
  • completeness – strategy & problem-solving.

Of the three uses – brainstorming, planning and completeness, it’s the latter that’s probably most overlooked in a given situation. I use a powerful technique that Dave Hunt taught me a couple of years ago.

The idea is to take a problem and break it down in stages, creating a complete list of possibilities at each level. If, for instance, your problem/challenge is to generate a higher profit, there are typically only two broad possibilities – to increase your revenue or lower your costs – so you enter this in Freemind:

Then you look at all the ways to increase revenue – more sales, higher price, etc. Following that you look at all the ways to generate more sales – more customers, more sales per customer, etc.:

As a non-linear thinker I jump between levels without necessarily completing any one level first, with FreeMind allowing me to move or regroup ideas as necessary. I don’t stop mapping until I have a complete view of the problem, down to the Nth degree – as far as it needs to be taken to assess my problem. I finish with a review discussion with one or more peers to see what I’ve missed.

If you do all of the above, you’ll have a complete view of your problem – the good news is that the answers to your problem are definitely on the page. Then you can assess which solutions are the most powerful or suitable and prioritise to determine your tactics and strategy going forward.

Why Freemind? It allows me to type thoughts as quickly as I think them, then easily reorder, highlight, change or regroup them once they’re written down. You can then export your files to PDF, various web formats or as an image. You can even copy and paste the nodes into MS Word to make headings for your document. Even better, it’s free and being Java it works on both PC and Mac.

To get the most of the software and work quickly when brainstorming you’ll need to learn some shortcuts, particularly:

[insert] to add a child node
[enter] to enter a sibling node (below)
[shift+enter] for a previous sibling node (above)
[F5] for a bright red node
[F1] for the default node style
[Alt]+[PgUp] to collapse a node
[Alt]+[PgDn] to expand a node

Try it – you’ll love it (or your money back).

Know where the work is

My car importing business is about a fun, high performance driving experience. The work, however, is in getting through compliance red tape and providing information to the thousands of people who contact us in the meantime.
Running a caf? is about a great place for friends and family to meet. The work is in early starts, late finishes and non-stop hard slog in between.
Running a telco is about people communicating with each other. The work is in billing correctly and handling a large number of customer interactions efficiently & cost-effectively.
The nature of the work effort in a business is typically different to and less glamorous than the purpose of a business would suggest. Make sure you know in advance where the work is – otherwise you may have significant skill gaps, inadequate systems and a business that you don’t actually want to run.

Persuading Led Zeppelin

Wanting to use Led Zeppelin’s Immigrant Song in the movie School Of Rock, director Richard Linklater cunningly asked Jack Black to beg them:

As discussed in Influence – The psychology of persuasion, Jack used three of the six weapons of influence to greatly enhance his chance of success:

Liking – Jack used this in spades with both humour and genuine respect,

Reciprocation – in the sense that they went to so much trouble – going to some trouble (in allowing them to use the song) is to be reciprocated, and

Social Proof – 1,000 people screaming – it’s not just Jack who wants this, it’s everyone in the theatre.

Liking is my favourite weapon of influence. Not only am I more likely to get what I need, the person I’m dealing with is more likely to enjoy their day. It’s based on mutuality, the bedrock of long-term business.

A motivational speaker owes me $100k

I once did business with and lost around $100k to a woman who was a big-picture visionary, able to see incredible opportunities and create trust with others almost instantly. She did, however, consistently over-promise and under-deliver, creating an increasingly long line of disgruntled former investors.

When despair was upon her, she would sequester herself to listen to her library of a well-known motivational speaker’s tapes, reappearing again an hour or so later ready to take on the world once more. In doing so, this unconsciously incompetent businesswoman avoided painful self-reflection, replacing it with a large dose of audio fire-walking. The way I figure it, the motivational speaker owes me (and no doubt other former associates) about $100k.

Self-reflection can be painful, but pays incredibly large dividends. Avoid it at your (and others’) peril.