Independent Thinking » Business

Your Customers Are Not Morons

Daria Steigman — Tue, 31 Jan 2012 06:02:29 +0000

This should be obvious, right?

[Insert BIG SIGH here.]

There’s a lot of talk these days about “empowered consumers” and what this means for companies. It’s an issue for pricing and sales, and for what consumers want and expect from the brands we interact with.

We have more information than ever a mouse click, search term, or social scroll away.

There’s a big gap between the empowered consumer and many sales and customer service teams.

Case in point. I was shopping around the other day for information on Internet service providers. Mine has been very reliable–but the price has gone up astronomically. So here’s how the conversations went.

1. Existing provider said they felt my pain. Customer service agent put me on hold for a couple of minutes while he (maybe) went off to see if he could give me a different service or a better price point on this one. Came back and spouted a company line about having only one speed of service and that I was paying the standard rate for that. I told him I was going to cancel. Said he would be sorry to see me go.

The rate I was paying was $7 over the highest rate listed on the company’s Web site. The base rate was 40% lower than what I was paying.

2. Prospective company’s sales guy wants to know what I’m paying now. Not relevant, I reply, I want to know what options you offer. Sales guy asked what provider I have now. (Nice try, same answer.) Then he starts talking about bundled new services–which I say is not what I’m asking about either. Finally, he quotes me a price.

The price he quotes me is 25% higher than the rate listed on the company’s Web site. And it’s for completely unbundled service–and I already have one service through this company.

They must think we’re morons.

Clearly, companies have a long way to go in understanding how the Internet–let alone social platforms–impacts the business/customer relationship.

Photo by macinate (Flickr).

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Are You Embracing Risk?

Daria Steigman — Mon, 23 Jan 2012 14:03:21 +0000

I had a conversation with my mom recently about an apparel retailer that is going out of business. She had attributed their fate to a declining economy. My own take: the clothing was staid–and there’s a limited market for boring. The company never took a risk. It didn’t try to refresh, modernize, reinvent for changing styles.

Successful businesses don’t sit still.

There’s a reason abandon is one of my 3 words for 2012.

There’s a terrific piece on Inc.com about taking risks and making mistakes. Author Paul Schoemaker points out:

If you have ever flown in an airplane, used electricity from a nuclear power plant, or taken an antibiotic, you have benefited from someone’s brilliant mistake. Each of these life-changing innovations was the result of many missteps and an occasional insight that turned a mistake into a surprising portal of discovery.

His point: you have to take risks, and test things, and be willing to fail (i.e., make a mistake). It’s a short article and well worth the read.

Photo by Brett Jordan (Flickr).

3 Strategies to Excel in a Tough Market

Daria Steigman — Thu, 12 Jan 2012 06:01:39 +0000

How do you manage uncertainty when, by definition, it involves wrestling with stuff that’s difficult–and sometimes impossible–to predict?

It all starts with understanding (and then leveraging) your competitive advantages, says Keith Bickel, author of Mastering Uncertainty. The book posits three different business models to optimize your competitive edge.

Are you a pioneer, a pouncer, or a hedger?

Read about the three strategies in my book review.

Photo by Steve Snodgrass (Flickr).

“Just Because” is a Stupid Way to Run a Business

Daria Steigman — Tue, 10 Jan 2012 07:02:13 +0000

It’s a new year, but are you still doing the “same old, same old?”

I wrote recently about knowing when to fold–giving up a product or a service or even a business development strategy that’s run its course. But there’s another thing business owners need to consider: what might be working, but doesn’t make sense.

This can show up in the people you engage with and the processes you follow. For example:

Are you loyal to an accountant, a lawyer, or even an insurance agent who does an okay job year after year rather than making the switch to someone who will really shine? (For the record, I have an awesome accountant if you need one.)
Do you keep using that cumbersome e-mail marketing system or time-management software rather than switching to something faster and more user-friendly?
Are you still faxing documents because you don’t have an electronic signature on file? (Oops, that’s me.)

Make every business action a conscious choice (not “just because”).

A case in point: My condominium association raises the parking fee by $5 every other year. But no one knows why they’re doing it. It’s just what they do. What they’ve done. You know why they’re doing it? Because over 10 years ago when I was condo board president I said I thought it was ridiculous to nickel and dime people with $2 and $3 raises. Somehow that translated into the current “policy.”

It’s a good practice to evaluate your business processes and policies from time to time. Now I’m off to find a scanner.

Photo by Evelyn Giggles (Flickr).

Why I’m Not an NFL Owner

Daria Steigman — Thu, 05 Jan 2012 07:02:58 +0000

You might have read that the Green Bay Packers are selling ownership shares. Which means that, for $250, you can own a share of the franchise. You can’t sell you share (or shares) and it won’t increase in value–but it makes you an owner of the NFL-Super-Bowl-winning franchise that was once coached by Vince Lombardi.

It would look really cool on my LinkedIn profile. But I’m not going to be an NFL owner.

$250 is real money. It maybe buys my next smartphone. It definitely buys lots of pints of beer at the ballpark this spring. But that’s not the problem.

The fine print is.

Ownership has its privileges. And its price.

Page 5 of the Common Stock Offering Document has a clause entitled NFL Rules that reads, in part:

The NFL Rules prohibit conduct by shareholders of NFL member clubs that is detrimental to the NFL, including, among other things… publicly criticizing any NFL member club or its management, employees, or coaches or any football official employed by the NFL.

Which means that, as an owner, I could be fined by the commissioner and/or required to sell my stock back to the organization–for $0.025 per share. (Come to think about it, that’s better than zero. But I digress.) Which means I couldn’t opine about whether Dan Snyder is the worst sports franchise owner since Marge Schott. And I couldn’t tweet that even a 2-year-old has more discipline than the Oakland Raiders. Not to mention that “what’s up with [insert name of player here]” would be off limits.

There’s a point here. And it’s not about American football.

It’s about reading the fine print.

Fining fan-owners of the only public NFL team would be a public relations nightmare. It’s not going to happen (unless someone really provokes it, or behaves in “conduct unbecoming” that defies public mores). But the business reality is that buying into this deal requires limits on your free speech. Not illegal limits–it’s not a 1st amendment issue. But limits nonetheless.

Business is about choices and trade-offs. Before you make your next deal, make sure you understand both.

Photo by Jeramey Jannene (Flickr).

Three Words for 2012: Crayons and Continuity

Daria Steigman — Tue, 03 Jan 2012 07:02:24 +0000

For 2012, I’ve decided that I don’t need to reinvent the wheel.

Last year, I picked out 3 little words–crayons, velcro, and abandon–to guide my business. The whole point was to keep me focused on moving forward, while giving myself permission to take risks again. And to have fun and be creative.

I found the right guiding principles.

Since “a continuous or connected whole” (aka, continuity) is an asset, I’m going to keep these words front and center for another year.

What are your guiding principles for 2012?

Photo by evoo73 (Flickr).

How 1BandID Founder is Using Social Media to Build Virtual Shelf Space

Daria Steigman — Mon, 19 Dec 2011 08:03:05 +0000

What do you do when the big boys own all the shelf space?

One approach is to build a virtual shelf, one person at a time. That’s what Joe Vukson is doing.

I met Vukson via Twitter earlier this year after I saw a press release about a new runner ID product. I tweeted to a friend that I didn’t understand how the product was any different from what was already on the market. Vukson chimed in, asking me what I meant. So we started tweeting back and forth as I tried to explain that I didn’t see any competitive differentiation. (I was wrong, but more on that in a minute.)

It wasn’t until the conversation had run its course that I learned that 1BandID is his product.

The Virtual Shelf Works

1BandID has a competitive differentiator: Vukson himself. In addition to engaging with people one-on-one, the budding entrepreneur moderates an on-point bimonthly Twitter chat (#trichat) and manages an active Facebook page. And he’s a runner and triathlete, so he’s walking the walk as he builds his community.

The big boys may own the storefront space, but who would you rather buy from? I’m sending people to 1BandID–because I know Joe.

Disclosure: Vukson sent me the red 1BandID pictured above. The best part: my running motto, “Forward Motion,” etched in there with all the contact info. But I hope you know that free swag does not influence what I choose to write.

Why Every Deal Is Not a Bargain

Daria Steigman — Mon, 12 Dec 2011 16:45:26 +0000

What’s up with the “2 for 1″ sales trend these days?

My thinking on pricing, rates, and value is pretty clear. And I don’t understand why some people think every deal is a bargain:

“Buy 1, get 1 free” suggests the item is overpriced.
“Buy 1, get the second free (just pay separate shipping)” suggests the product is so cheap that all the profit is built into the shipping cost.
“Used to be [a lot more], but really great price today” tells me the product is pretty close to worthless. And no one’s buying it and we desperately want to get rid of our inventory.

I’m all fine with sales–everyone knows that’s a temporary drop in your profit margin. (And “2 for 1,” used judiciously, can serve that aim.) But when your business model is all about discounting, then I start to get worried.

What about you? Seen any deals lately that aren’t bargains?

Photo by Anthony Easton (Flickr).

Knowing When To Fold (How an IABC Business Column Comes to an End)

Daria Steigman — Thu, 08 Dec 2011 08:03:23 +0000

Sometimes you have to know when to let go:

The best small business owners are constantly innovating—rethinking a product, redesigning our Web sites, tweaking our marketing approaches, testing productivity tools and technologies. It’s what we do.

But we’re really bad at stopping the things that are part of our routine but shouldn’t be anymore. Like advertising in the yellow pages. Or sending a telex rather than a tweet. These might have been useful or cutting-edge at one time, but now they’re just eating up your resources and/or your attention.

My latest IABC business column is out, and it’s all about knowing when it’s time to fold.

For the past year, I’ve been struggling to figure out what content should be “held” for the column versus what I’m writing about here (let alone anywhere else). It’s become a chore, one more thing to do, without seeing a compelling business purpose to put the time into it anymore. So I’m letting it go.

Read the column here. There’s also a nice “Top 7″ editors’ picks list–their favorite Independent Thinking columns over the years.

What are you doing today in your business that you need to let go?

Photo by laffy4k (Flickr).

4 Lessons From the Shakespeare Theatre About Valuing Customers

Daria Steigman — Tue, 06 Dec 2011 09:04:16 +0000

I’ve talked before about how brand loyalty isn’t eroding (we’re just saving our loyalty for where we feel valued). Today I’m doing to share four lessons from an organization that just doesn’t get it: The Shakespeare Theatre.

Lesson #1: People are more likely to donate if they feel connected to you.

In 20 years, the Shakespeare Theatre only called me to ask for money. No one called just to find out how I liked my subscription, whether I had any concerns, or even just to say “thank you.” They never held a subscriber-only Q&A with cast members (at least they never invited me), or sent t-shirts, mugs, or even bookmarks to mark milestones (e.g., 10-year subscriber!), or any of the little things that say “we appreciate your business.”

Lesson #2: People are more likely to donate if they feel their donation matters.

The organizations that get donations from me year after year are the ones where I understand where my money’s going and that it’s getting good bang for the buck. Feeding America, for example, states upfront that “your gift makes a big impact–every dollar you donate helps provide 8 meals to families struggling with hunger.” The Shakespeare Theatre’s individual contributions page lists as a reason, “The incomparable Michael Kahn.” Huh? That would be like me setting up a foundation and listing “Daria Steigman’s running it!” as a reason to give.

Lesson #3: You need a CRM system that codes for quirkiness.

This year, I transferred my tickets to the friends who have been using most of the tickets over the last 2-3 years. (They’re good seats. We wanted to keep them “in house.”) I’ll probably go to one play, maybe two. But since the account is no longer in my name, the Shakespeare Theatre called me three times in rapid succession to ask about renewing. The first time I explained that I’d transferred the tickets. The second time I explained it again. The third time I told them to stop calling. “This season?” they asked. “No. Forever.”

Lesson #4: There’s a difference between subscribers and people who subscribe.

The first one is about numbers and dollars. The other is about, well, people. Savvy organizations know that the best way to guarantee the first is to truly value the second.

Photo by Mark Hillary (Flickr).