Grocery stores may ‘appear’ to be the model of one price for all customers. Although they post one price, they charge another to shoppers with coupons and a third to those with frequent-shopper cards that allow stores to collect detailed data on buying habits. Information technology facilitates airline seats or hotel rooms to have over 30 prices.

In the 21st century, only those organizations using IT properly will be able to know their customers or targeted customers and be in a position to give them what they want. Those that don’t know precisely what their patrons want will eventually lose them to information intensive competitors. You can learn how to:

• Discover what customers will be demanding.

• Gather information and keep ahead in customer retention.

• Create relevant customer content and grow your business.

Information technology can help those companies who are truly focused on serving their customers by relentlessly collecting and analyzing information about them and using it to deliver what they want. What attracts them to your company?  What retains their loyalty? What causes them to leave?

According to the winter 2011 issue of Strategy+Business, Booz & Company “Business-to-consumer companies are striving to build customer-centric businesses but many are unable to derive real value from their effort.” Start by defining the qualities that characterize loyal, profitable customers.

Although everyone is using information technology, few companies have optimized their success. Booz & Company states that the small number includes;  Charles Schwab with investments, Capital One with credit cards and Caesars Entertainment with gaming.”

Competitive advantage using Information technology can be created in many ways and has allowed Federal Express to become the ‘standard’ of overnight delivery. It knows exactly where every customer’s shipment is at any point, and if delivery preference is with or without a signature. Information technology has kept prices flexible (overnight, next day or three day delivery) and competitive.

Grocery chains that automatically produce diaper coupons when a frequent shopper buys baby food but not diapers are presenting relevant customer content. When a book purchase is made on Amazon, IT instantly delivers a listing of other popular materials on the same or similar subject…that customers have recommended.

Information technology enables targeted customers to get offers for things they want from great buys on a pedicure, office supplies, new wardrobe, health club membership or a Caribbean cruise? Behind the scenes IT has collected information about what your preferences, interest and buying habits are. Before long, the only people paying the full retail or the “insult” price, will be people who prize their privacy so much they are willing to pay extra for it.

Technology allows businesses to take advantage of every clue; every business transaction, every phone call, every bill, and every complaint contains relevant information. Has the customer responded in the past to e-mails, to personalized letters, or to telephone calls? Does the customer have a history of ignoring mass mailings?

The mere collection of data is useless unless it can be used to ultimately capture the hearts and minds of the consumer. The Strategy +Business article said that market segmentation is key. “The most important question is, what is the purpose of segmentation?  Schwab’s approach segments investors by assets and their desired level of relationships support.”

In Crafting Best-in-Class Business Intelligence, authors Campbell, Kurtzman and Michaels said, “The first step in designing a successful business intelligence strategy is to choose the right metrics.  They should be closely aligned with the company’s strategy and capabilities including both internal and external inputs.” What do your customers want that you have the capability of delivering better than anyone else?

Data about each customer can allow you to identify them and treat each individually.  How does that customer like to receive information?  How long has that customer been with you and what have their purchases been in the past? Based on their purchasing history, what other products or services might they be interested in?

Utilizing such knowledge gives companies like Schwab, Capital One and Caesars major competitive advantages. It can result in major cost savings and stimulate targeted marketing programs that produce eye-popping returns.

Those organizations that know their customers better than the competition, and act on that knowledge will gain consumer loyalty and an even greater share of their purchases and accelerate customer relationships which always lead to increasing profits.

Questions for discussion:

Are we utilizing information technology or just collecting information?

How could we segment our customer base and make more relevant content offers?

Although the June 2011 report published by the McKinsey Global Institute states that the recession has caused a decline of seven million U.S. jobs since December of 2007 as well as a drop of 23% in the rate of new business formulation we face a shortage of qualified workers.

Quoting the McKinsey report, “In our survey 64% of companies reported having positions for which they often cannot find qualified applicants, with management, scientist and computer engineers topping the list.” More than ever, the skills of job seekers don’t fit the demands of job openings.

• Skilled-worker shortages are limiting competiveness, growth and profits.

• Help qualified employees develop commitment to stay with your company.

• People who feel connected are motivated to maintain the connection.

Many companies not needing scientific and computer engineering skills have become complacent and are taking their workforce for granted. For them, competing to retain and attract good workers is only a faint memory of the past.  But as boomers retire, GEN X and GEN Y workers will replace them and successful businesses will have to address their new demands and expectations.

In an article by Natasha Lomas that appeared in Silicon.com she states that, “For GEN Y, work time and ‘my time’ will be intermingled. Companies tuned to the new ways people connect and collaborate will allow workers the freedom to leverage these dynamics. Successful businesses will have to address new demands and expectations, new types of working and new ways of motivating people. The new workers will be upset if they can’t use their own personal communication devices.”

Rapid adoption of information technology has created a shortage of technically skilled people and a surplus of unskilled people.  After cutting payrolls to the bone, companies have increased productivity by asking remaining workers to do more.  Employees have accepted this great workload simply because their happy to still have a job.

The attitude of, I don’t care if my people are happy, I just want them to get the work sets the stage for a mass exodus when the economy and employment options improve.  Repeated studies done in stores, factory’s and sales offices all conclude that the happier people are with their jobs the more the organization benefits through higher retention, increased customer loyalty and improve financial outcomes.

Companies need to be prepared for the coming change which will be the dawn of a new workforce. An article titled Rethinking the War for Talent, the summer 2008 MIT Sloan Management Review stated, “The cost of hiring and training a new worker can be 150% of the cost of the parting employee’s salary.” Retaining quality people, high skilled or low, translates directly into higher productivity and greater profitability.

The Journal of Experimental Psychology reported that research involving more than 2000 office workers concluded that simply by giving people control over designing their working space increases productivity.  A study by the University of Exeter in England found allowing employees to personalize the design and layout of their work space can increase productivity by up to 32%.

In 2005 Best Buy implemented a ‘Result Only Work Environment’ or ROWE. Everyone was told to focus only on producing measurable results. Employees routinely telecommute, change when and where they work and don’t have to get permission or even inform a manager.

In an article titled Changing Workplaces to Reduce Work Family Conflict, published in the American Sociological Review in April of 2011 researchers Kelly and Moen found that ROWE reduced family-work conflicts and improved job satisfaction.  It also reduced turnover by turnover by 45%.

What will the new workplace look like? Rob Carter, chief information officer at FedEx suggests observing the online game World of Warcraft. “It takes exactly the same skill set and people will need more and more of in the future to collaborate on work projects, and kids are already doing it.”

Carter continues, “In the game, teams embark on quests which are a fast paced, complicated series of obstacles. The team leader is the one who contributes the most.  When someone else steps up to contribute more, he or she becomes the leader. It is intensely collaborative, constantly demanding, and often surprising.

New workers place great emphasis on being happy in their jobs. The traditional path of spending years working one’s way up the corporate ladder is over. How, from where and when the job is accomplished will attract the best workers in the future. Respect, collaboration, flexibility and telecommuting will continue to boost both productivity and motivation as it gives our new workforce what they want most.

Fortune recently reported that 74% of all jobs created in America between today and 2020 will require 123 million highly skilled workers and that there are only 50 million qualified. Companies like Boeing, Google, Genentech, Cisco Systems and Ernst and Young all have jobs open for highly skilled people in specific areas that they can’t fill.

Businesses must change and learn that the secret to success in the new economy rests on an old-fashioned idea: Help your employees to get what they want and they will give you what they want. In an age in which business success relies on people and their talents and knowledge, commitment is of paramount importance in securing the future of any organization.

To capture quality talent over the long term, employers must change and provide opportunities for growth and self-expression…an environment that is clean and safe, both physically and psychologically…and clear evidence of caring. If these goals sound too “personal” for your business, then you’re likely to experience a quality employee shortage.

Questions for discussion:

Have we become complacent and uncaring about how happy the people who work for and with us are? How could we do better?

Are we focused on creating the flexible and collaborative environment that workers in the 21^st century demand?

What causes an idea to go from obscurity to popularity? Business is filled with remarkable cases of products and ideas that became enormously popular and profitable, from Harry Potter books to bottled water.

Sharp introduced the first low-priced fax in 1984 and sold 80,000 units that year. Over the next three years, businesses slowly and steadily bought more fax machines and, by 1987, enough people had a fax that it suddenly made sense for everyone to have one. This column will enable you to:

• Gain runaway successes with your products or services spreading with the force of epidemics.
  

• Engage the influence of others or through word-of-mouth and spread your ideas, products, messages, and behaviors like viruses. (CRM).
  

• Win over the three types of the most powerful and influential people by the ability to identify connectors, mavens and the right salespeople.

Sharp sold one million machines in 1987, and two years later sales doubled. Cellular phones have followed a similar pattern as they became smaller, lighter, and cheaper. In 1998, suddenly everyone had a cell phone. The same is true of smart phones and the use of texting.

The difference between a world filled with cell phones and one without them is much like a snowstorm and the previous day. A drop in temperature of just a few degrees causes a foot of snow. Almost nothing has change, yet everything has changed.

Runaway successes of certain products and services take place with the force of epidemics. Ideas, products, messages and behaviors spread much like viruses. Business epidemics are highly contagious as the use of a technology, or an idea by one person, can cause many others to do the same.

Sharp started with only 80,000 sales, but that small base of customers helped to persuade many others to buy. As we have all seen, epidemics appear almost overnight. Fax machines did not grow gradually by five percent per year for 20 years. Sales exploded in just three years.

“One American in ten tells the other nine how to vote, where to eat and what to buy,” according to Ed Keller and Jon Berry authors of The Influential’s. To illustrate, Hush Puppies shoe sales had slipped to 30,000 pair in the early 1990s, yet six years later, sales climbed to over 2,000,000 pair. What happened? A small number of East Village teenagers started wearing them because no one else was…and an epidemic was born.

Two New York designers noticed this local fad and used them in their fashion shows. Next, Hollywood opened a Hush Puppies boutique, and then, Hush Puppies exploded and became available at every mall in America.

Just as a flu outbreak has its origins in a few “infected” people, business epidemics begin with a small number of individuals. Fax machines, Hush Puppies, cell and smart phones all reached epidemic proportions because a small percentage of trendsetters owned them. When they symbolize instant status, everyone else wants to gain it by buying the same product.

We all buy products mainly because of the influence of others or through word-of-mouth. Author Malcolm Gladwell in The Tipping Point says that we’re influenced by three types of people.

• The first type is connectors, who have extremely large circles of friends and acquaintances, and not only know the CEO, but also the mail person and the security guard.
  

• The second group is known as mavens, who primarily know about things and share information freely.
  

• The third group is comprised of salespeople, who are the ones who sell ideas, fashions, and products. They’re incurable optimists who cultivate customers assiduously.

All three types have persuasive personalities and wield a unique talent. They control the rhythms of communications, making their own emotions contagious, and dictating the terms of their peer group interactions.

For every business, the eternal question is,” How do we get our message across at a reasonable cost?” The answer is to create an epidemic…the kind that drives customers to your door. Starting an epidemic requires the discipline needed to concentrate resources. Connectors, Mavens, and Salespeople are the resources…the instigators of word-of-mouth epidemics.

Questions for discussion:

How can we identify the ‘influencers’ that exist in our existing customer base and make them strong advocates of our products or services?

Could we then identify and subdivide our influencers into Connectors, Mavens and Salespeople and customize an approach to get more business from each group?

Most organizations believe the aim of business should be to form lasting relationships with customers. Does your company draw the line with customers who pay late, or threaten not to pay at all? The real goal is to get them to make payments, without losing their business.

How much does it really cost you to lose a customer? What is just one customer worth to a company over an average purchasing lifetime? In Superior Customer Value authors Weinstein and Johnson say, “Ford Motor Company recently calculated that the lifetime value of their typical customer is $178,000.”

• See non-payers as “partners” who are in trouble, rather than as cheats or deadbeats.

• Understand that happy customers not only buy from you; they send friends, relatives, neighbors, and associates to your door.

• Successfully collect late payments without losing the customer by treating them as honest people, who need friendly, but firm, attention.

In both a good and bad economy we must always ask, what is the lifetime value of this customer?  Heavy-handed collections are seldom successful at getting payments but always create resentful ex-customers. These people will never buy from you again, even when their finances improve.

Conversely, happy customers not only buy from you, they will tell the world about you and bring new business to your door. If each customer who is part of your accounts receivable challenge can bring you more new business, doesn’t it seem foolish to behave in a way that discourages them from coming back?

This applies to customers making late payments as well. According to Weinstein and Johnson, the collection supervisor for an upscale department store believes that the majority of late-payers are honest people facing either tough financial problems, or they are simply reacting to poor customer service concerns.

One customer this supervisor dealt with had encountered many personal setbacks…

• Divorce

• Layoff

• An extended illness

The customer ended up bringing his account current and later explained that he always paid her first because she made him want to keep his commitments to her.

At US West Cellular, the challenge was always to collect a late payment without losing the customer’s business. The premise is to look at late-paying customers as honest people who need friendly, but firm, attention. If we take the time to emulate US West Cellular’s methods, we not only get paid, we get to keep the customer.

• Once an account becomes past due, and upon initial contact, you should always start a conversation by saying that you’re confirming that they have sent in their payment. Starting the call off on a friendly note assumes the customer did what you asked them to do through previous invoicing.

• The second aspect of the message is to show empathy. Those who owe you money are people just like you, and facing the same problems you face. Follow up by immediately offering the customer a choice of using a credit card or setting up a payment plan. Customers must know that although you take their debt seriously, you are willing to work with them.

• Next, always ask why the customer has failed to pay on time. It’s very common for customers to withhold their payment because of customer service problems. Holding payments gives the customer a way to get proper service and satisfaction.

Always being friendly but firm establishes the foundation for a continued relationship. Aim for a specific agreement about how the customer will pay and ask them to repeat it to you. Put the agreement in writing, and send a copy letting them know that you expect the agreement to be followed. Each time the customer makes a payment, call to thank them and reinforce the good behavior.

Author Dean Shepherd in From Lemons to Lemonade reminds us, “The reality is that failure isn’t always a learning experience. In fact, learning from failure is neither automatic nor instantaneous. It takes time, and it requires a process that can be managed in order to maximize the learning from failure.”

Perhaps current collection practices have been driving customers away rather than building stronger relationships. If you follow these guidelines, establish a well thought out collection process whose goal is to get overdue accounts to make payments and not lose their business; you can actually have your cake and eat it too!

Questions for discussion:

Does everyone know the lifetime value of our customers and how poor collection practices can hurt our profits?

How can we get each late-paying customer to happily pay-up and bring us even more new business?

In the automotive services industry, local garages usually have the highest customer retention and the lowest employee turnover. When customers were asked why they were especially loyal to local garages, they said they felt more comfortable doing business with a mechanic who knew both them…and their cars.

Employees, who stay with your organizations for a long time, are very valuable. They have the ability to build solid personal relationships with customers, enjoy far greater opportunities to learn more efficient ways of doing their work and reduce your need for recruiting and training new people.

• Loyalty is worth a bundle.

• Customer and employee loyalty go hand and hand.

• Create a staggering increase in profits by increasing employee loyalty.

Frederick F Reichheld, founder of Bain & Company’s ‘Loyalty Practice’ points out that a trucking company found they could increase profits by 50 percent simply by cutting employee turnover in half. Many organizations pay little attention to the relationship between customer and employee loyalty because they don’t know how much it is worth.

In his book The Loyalty Effect Reichheld says, “In the brokerage industry, half of the customers who switched firms did so because their brokers moved on to a new company. To bring a new broker to profitability, the up-front cost of hiring and training exceeds $100,000. It isn’t until the third year that new brokers will earn any real profit for the firm.”

What does it cost you to find, hire and train a new employee? How much time is taken away from the jobs of existing employees in that process? How long does that new person have to be there in order for you to just break even on your investment?  What is the effect on your customers when a good employee leaves?

Few industries track the profitability of individual employees in as much detail as brokerage firms. For many organizations it may not be simple to measure the value of employee and customer retention…but it is critical for the ongoing success of your organization to recognize that there is a direct relationship.

As brokers gain experience, they learn to target customers more effectively, and their customer retention and share of wallet increases. As more and more new customers come to them by referral, they spend less time prospecting. As proof, A.G. Edwards, before being acquired by Wachovia in 1997, had the highest broker retention rate in the industry, and was the leader in profitability.

In Wired to Care author Dev Petnaik says, “We are wired to connect with and care for others. The limbic system enables us to form tight bonds with friends and family members. We share emotionally charged memories with them, and they become deeply embedded in our responses over time.” Only time can allow this emotional connection to develop between your employee and customer.

As you realize the importance of retaining employees in order to increase customer loyalty and profits,,,you may want to create new measurement systems that will carefully analyze the results of improved retention.

• Regardless of the measurement system you use, what you will probably find is that you presently invest significantly in hiring and training.

• You also lose a startling amount of profits due to the exodus of customers caused by inexperienced employees.

Nevertheless, you can create a staggering increase in profits by increasing employee loyalty, which will lead to better customer retention. To make sure you’re gaining the loyalty of customers and employees requires a system to measure productivity that makes sense for your business.

Retail stores usually concentrate on sales per square foot. Nordstrom measures revenue per sales clerk and ranks each clerk’s performance on the employee bulletin board.  The very nature of this metric encourages employees to develop caring and nurturing relationships with their customers.

Insurance claims adjusters are measured on the average size of the claims they approve and are seldom promoted when they appear to be too generous. The Catch-22 is that when they underpay, adjusters alienate customers who take their premiums to another company. The solution is to measure the retention rate of the customers who deal with each adjuster.

By combining each adjuster’s average claim amount with his or her retention rate, the company can see their real revenue and profit impact on the company and give out bonuses accordingly. When adjusters are trained to understand the value of high retention rates for certain customer segments, they will take customer loyalty into account when deciding how to settle each claim.

The most successful organizations are not offering incentives to their longest term and highest paid employees to retire. They realize the significant value of the relationships and the profits that they add to the organization. Customers don’t do business with a company or organization…people want to do business with people they know.

Questions for discussion:

How much are we losing as a result of employee turnover and what can we do in order to increase retention?

What can we do to build even stronger relationships with our employees and our customers?  Can we facilitate them getting to know each other better?

Gary Ryan Blair, author of Everything Counts says, “A well-defined plan, properly executed, is your ticket to success. You significantly increase your odds of winning in any endeavor if you know who you are, what you want, where you are going, how you will get there, and what you will do when you arrive.”

Called one of the world’s most influential thinkers on excellence and productivity, Blair continues, “Though it may seem like common sense, this fact is often overlooked: Your life will not go according to plan if you do not have a plan. As tedious as it may seem, effective planning ensures a greater sense of security in yourself and the actions necessary for success.”

• Use a business plan as a blueprint and road map to success.
• Understand how all the parts fit together to achieve your mission.
• Be far more productive and profitable while focusing on specific goals.

Many organizations and are unfocused, undisciplined and unprepared. They continue repeating yesterday’s mediocre performance today, tomorrow, and the next day because they despise planning. To create an exciting future rather than repeating the past, simply develop a plan that allows you to experience exceptional growth?

Planning is the continuing process of strengthening what works and aban­doning what does not. It is the ongoing process of making risk-taking decisions, of setting objectives after having considered their possible effects. With systematic feedback and appraisal of performance results, adjustments are made as conditions change.

In bestselling book, The Five Most Important Questions, the late Peter F Drucker, widely considered to be the world’s foremost pioneer of management theory reminds us, “To formulate a successful plan, you will need to understand each of your constituencies’ con­cerns, especially what they consider results in the long term. To integrate what your customer’s value into your plan, you must listen to them, accept what they value as objective fact, and make sure the customer’s voice is always part of your discussions and decisions.”

In structuring a business or management plan critical questions must be answered. Why should a customer purchase your product or service rather than any other offered? What benefits will they enjoy from dealing with you that they won’t get anywhere else? What is your unique selling proposition? What differentiates you and your business from all of your competitors? How much demand is there for your product or service, and how do you know if the demand is increasing, stable, or shrinking?

Don’t overlook these questions.

• Who is already providing this product or service, and what are their strengths and weaknesses?

• Why do their customers buy from them now and what compelling reasons can you give to encourage them to change?

• What are the strengths and weaknesses of your competitors, direct and indirect?

For example, a direct competitor for a children’s clothing store would be anyone else within your marketing area that’s specializing in children’s clothing. An indirect competitor would be all the department stores that carry children’s clothing.

Customer can be both rewarding and ruthless. Customers will reward bountifully those businesses that serve them well. On the other hand, a customer will tell everyone, except the business itself, if it failed to meet their expectations.

Steven Brandt, Management Professor at Stanford’s graduate school said of a business plan, “It’s the same as drawing a blueprint for a house before you start nailing down the boards. If you don’t want to take the trouble, go back to working for someone else.”

Simply stated, every customer is just like you and I, with the exception of what they define as quality. The Cross-Pen Company is an excellent example of serving customers with different quality definitions. All of their customers want a quality-writing instrument with a lifetime guarantee. For some, wood or chrome, at a moderate price, is appropriate. Others insist on the same quality and lifetime guarantee but want 18 carat gold.

The customer always wants the highest quality at the lowest possible cost, and all things being equal, will deal with you and your business only if you meet that definition. With 80 percent of new businesses failing within the first five years a written business and management plan is a modern day necessity.

Use of the three P’s are critical.

• Proper
• Prior
• Planning

The primary advantages of using the three P’s are that it costs very little and greatly enhances your opportunity for success. A properly completed business plan will put you on the path to joining the top tier of all businesses or professionals in your industry.

Questions for discussion:

Do we have a plan that is a concise summation of our organization’s purpose and future direction and explains why our customer will choose us over all others?

What will it take to write a plan that encompasses our mission, vision, goals, objectives, action steps, budget, and appraisal process?

When customers go to Amazon and buy something, Amazon is the brand, not what they buy. Is the combined power of the big box stores, “bricks and mortar” with the Internet, “get anything on line” systematically killing off local brand equity? The only protection against this fate is to build your own “niche market” or become a “gorilla”.

Consider the effect that Best Buy, Wal-Mart, Home Depot, Staples and Target have had on retailers throughout the United States. Have they hurt service providers as well? The Geek Squad has a presence in over 1,100 Best Buy stores and Radio Shack has kiosk in all 1,490 Target locations. Are smaller businesses being pushed out?

• Know your strengths and what markets to serve.

• Realize that “niche players” have the ability to be successful and how.

• Focus on strategies to help customers get important jobs done.

In e-business that may mean being everything, to everyone, all the time. For $39.99 a month, any organization can list up to 40,000 items and reach tens of millions of potential customers using the Amazon Marketplace.

• “Amazon.com Payments” allows seamless transactions while the customer receives credit security and merchandise guarantees.
• Amazon’s “All Product Search” allows a buyer to find anything that’s for sale.
• The implications are terrifying!

What business is Amazon in? It started in 1995 as an online bookseller and struggled for 5 years, including the dot com bubble burst. Amazon persevered, and finally turned its first profit in the fourth quarter of 2001. That modest profit convinced the skeptics that the business model could be profitable.

Today it’s an octopus with tentacles stretching around the globe. Product lines include books, CDs, DVDs, software, consumer electronics, kitchen items, tools, lawn and garden items, toys & games, baby products, apparel, sporting goods, gourmet food, jewelry , watches, health and personal-care items, beauty products, musical instruments, clothing, industrial & scientific supplies, and groceries. There seems to be no limit to its growth or diversification.

On-line companies like Amazon…the 800-pound gorillas, will set the agenda for the future of the Internet just as the Wal-Marts and Home Depots have for bricks and mortar businesses. There will only be two kinds of companies in the future, Gorillas or Niche Players.

How to succeed as a niche player. According to author Anthony W. Ulwick successful niche players simply have figured out what jobs customers are trying to get done and delivered a superior solution. They have carefully segmented their market, targeted the best growth opportunities and positioned their current products or services to address the under served jobs that really matter to their customers.

In What Customers Want, although Ulwick focuses on how ‘innovators’ are successful, the same principles apply for niche players. The first type of niche marketer would be focused on product or service innovation. “To succeed at it, companies must discover which customer outcomes are being underserved and then devise and provide creative features in their products and services that do a better job of addressing those outcomes.”

New market innovation must occur when a niche player discovers that a customer is struggling to get a job done on their own because no product or service exists. The PC, cell phone and wireless networks are all examples of new market innovations.

Ulwick points out that operational innovation happens when a company discovers inefficiencies in a mature market and addresses them with creative solutions. “Dell successfully achieved operational innovation in the computer industry by cutting out the middleman with its ‘buy direct’ approach.”

Successful niche players will help consumers get a specific job faster, safer, or cheaper than before and help consumers get more jobs done. Successful players will determine what related jobs their customers want to complete and either enhance their existing product or services to help or create new ones.

Yet another opportunity may be to help non-consumers get a job done that others are

already doing. Niche players may focus on creating innovations that target people who want to get a job done but can’t because the products available for doing the job are either expensive or require specialized skills.

Steve Jobs and Bill Gates, by creating inexpensive user friendly personal computers, turned non-consumers into a massive global market with the PC. In effect they helped millions of people get many jobs done that nobody, except the largest companies with mainframe computers, were doing yet. Niche players that use this option must create a new product or service where there currently is none.

Determine whether you will be a gorilla or niche player and in either case, remember that both go out of business every day. Continue to be successful by constantly asking, what jobs are your customers are trying to get done. Then help them complete them faster, safer, or cheaper than before.

Questions for Discussion:

What are the most important jobs, task or activities that our customers or prospective customers are trying to get done?

How can the utilization of the unique set of skills talents and abilities of our people, including outside suppliers, vendors and consultants provide the best solution?

Long ago organizations realized that newspapers, television and radio are one-way media. People have always loved to buy but hated to be sold. What makes the Internet different is that not only do your prospects and customers have total control over what they see and hear…but they love participating and influencing the decisions of others.

The simple fact is that people dislike advertising. Because of the similarity of the computer “mouse” to the TV remote, it’s not a surprise that Internet sites used to spend most of their advertising dollars on radio, television, and print media. They recognized that it was futile to try to advertise in an interactive medium like the “Net.” Today the customer is totally in charge of advertising.

• Look at getting more business from the net in an entirely new way.
  

• Understand the customer is only a click away from a thousand other options.
  

• Based on these understandings intelligently let others do the marketing for you.
  

The Internet is the biggest system of word-of-mouth in existence, and marketers are only now beginning to figure out how to use it effectively. Don Tapscott author of Growing up Digital says, “By using Facebook, Linkedin, Twitter, MySpace, YouTube, text messaging, instant messaging…blogs and cheap video editing software, companies of any size in any industry can turn their consumers into producers, or ‘prosumers’.”

The customer, not the company now is in control of the marketing. They create public opinion online with one another. Wouldn’t we all like to buy things that are recommended by other people, real customers, rather than the company’s advertising or public relations agency?  ‘Prosumerism’ comes from facilitating the involvement of the company and its customers.

The beginning of interactivity was the ability to type in your instructions on a search engine and the Internet would deliver listings for the information you requested. If you typed in a specific book at Amazon.com, the site also presented a list of books that matched your category, and gave the titles of at least three other books bought by previous buyers of the book you just ordered.

Next came the use of ‘keywords’ to get traffic to your website, followed by the use of ‘clickstream data’ which could tell you where the visitor went when they entered the site. Cickstream data is great at answering what the visitor did, but not at the why. We could only guess that an individual who searched ‘Alaska Cruises’ was planning a vacation?

According to Avinash Kaushik author of Web Analytics 2.0, “Most businesses that focus on web analytics think of it as the art of collecting and analyzing clickstream data. In the new paradigm of Web Analytics 2.0, ‘Experimentation and Testing’ help explain the why and ‘Multiple Outcomes Analysis’ answers the how much. Lastly, ‘Competitive Intelligence’ answers the what else.”

By knowing why the prospect came to your site, how much they were able to spend and what else they may be looking for…businesses will be able to customize irresistible offers. The intelligent Internet, by having tracked the preferences, previous buying patterns and behavior of the visitor who typed in ‘Alaska Cruises’ will know what type of cabin accommodations they prefer on board, what they are willing to pay as well as land tours and other excursions they may enjoy.

Organizations everywhere must make decisions as to how they will use the Internet for marketing. While the physical retail store may not be able to compete on price, it can always outperform on basic human needs. Touch and time are their buzzwords. That store still needs the intelligent Internet to get people to come to it.

• People can go in and touch the products.
  

• Time means that you don’t wait for delivery.

The intelligent Internet also allows the prospective consumer to know when a company acts unethically. No amount of public relations or spin can save a company that has earned a bad reputation. Your business DNA must be based on consideration, honesty, transparency and accountability. There are no secrets on the intelligent Internet.

Tapscott, in Growing up Digital reminds us that rather than focusing on your prospects and customers; engage them. “Turn them into ‘prosumers’ of your goods and services. Don’t create products and services; create consumer experiences.” Add value to your offerings to make them richer experiences.

In Strategy+Business, Summer 2011 Jamie Campbell, Kenny Kurtzman, and Adam Michaels of Booz & Company explain in their article titled Crafting Best-in-Class Business Intelligence, the reason that most companies aren^‘t getting the most out of their business intelligence has nothing to do with the software itself. Most off-the-shelf BI products are easy to implement and incredibly powerful; they can aggregate, integrate, and analyze data from nearly any part of the organization.”

The key to marketing is word of mouth. Tapscott reminds us that, “The Four Ps – product, place, price, and promotion are an inadequate framework to deal with the consumer of the future. Replace them with the ABCDE of marketing: anyplace, brand, communication, dis­covery, and experience.” The customer will, from anyplace in the world, communicate what they discovered about your brand and their experience with your organization…make it exceptional.

Questions for discussion:

What can we genuinely offer and deliver to a customer that will create an experience that will have them telling their friends about?

Are we committed to abandoning our old marketing techniques using product, place, price, and promotion and embracing the ABCDE of the intelligent Internet?

Will you become one of the next business visionaries? If not, be careful not to be blind-sided by those who do. Visionaries often take elements that have been around a long time and simply combine them in a new way to add greater value.

People had been shaving with straight razors for centuries.  Then along came King C. Gillette, a traveling salesman who liked to invent things. At the time, the entire shaving industry viewed its equipment as being designed to last a lifetime. It was a high-quality, high-margin business.

• He envisioned a cheap, low-margin product in a world of high-quality, lifetime razors.
  

• Experts told Gillette that he’d never put an edge on a cheap piece of metal.
  

• To most people, Gillette appeared to be a lunatic, not a visionary.

The same was also true of Fred Smith, who wrote a college term paper outlining the basic idea for Federal Express. Smith dreamed of having his own fleet of planes dedicated to moving packages and envisioned a hub-and-spoke system, with all packages brought to a central location and sorted. Packages would then be sent back out on a dedicated fleet of planes and trucks.

Like Gillette, the business that Smith envisioned would ultimately serve a huge mass market. Both Gillette and Smith were people who closely observed and gained great new ideas from everything around them…like people shaving daily with straight razors, package delivery,  planes, roads and trucks. They simply connected the dots and were aware that most visionary ideas come from looking outside.

Looking outside created the same sort of vision that powers what we now call the Internet. Most people don’t make a distinction between the World Wide Web and the Internet. The Web is actually a network of information sources that can be reached through the Internet and is a collection of almost a billion computers around the world.

The Internet, on the other hand, began at the Defense Department in the late 1960’s, when a few researchers linked their computers. Each network had its own language and protocol for communicating. Then, in 1980, Tim Berners-Lee wrote a simple program to remember all of the connections required for the networks to talk to each other.

Berners-Lee began to think about a system in which anyone could get onto the Internet and roam around and find things. Hypertext was already in existence, and he saw it as a key to allow users to jump from one document to another instantly. He saw that uniform addresses would be needed and called them URL’s, for uniform resource locators, so that the links would know where to take the user.

Finally, everything would have to follow a standard protocol for shooting the information across the wire. He called it hypertext transfer protocol, or http. Berners-Lee didn’t really invent anything; he just combined various technologies and called it the World Wide Web.

Some of us are even old enough to recall that the first video recorders cost $75,000.

• The manufacturer, Ampex, paid no attention to the mass market and gave absolutely no thought to the future and what they had in their hands.

• Meanwhile, emerging companies such as Sony, JVC, and Matsushita began research efforts, targeting a unit to sell for under $1,000.

VCR’s eventually permeated the mass market as their cost fell to less than $100 and been replaced by the DVR. Ampex, having missed the gold mine that was right in front of their eyes…is history.

In 1971 Michael Hart, a student at the University of Illinois received $100,000.00 worth of computer time with a Xerox Sigma V mainframe and decided that the greatest value would be the storage, retrieval, and searching of what was stored in our libraries. Project Gutenberg was launched and produced the first “e-book,” a copy of The Declaration of Independence.

Today Project Gutenberg has morphed into a huge industry with e-books being read on all sorts of wireless devices including our cell phones. Amazon recently announced that the third-generation Kindle is the best-selling product in Amazon’s history and founder Jeff Bezos said the low price point of the new Kindle, $133-, is the key to its success in making it available to the mass market. Everyone knows the best use of computers is to do research and process information…everyone that is except that lunatic student, Michael Hart.

You may be like Gillette or Smith and entering an established mature market with lots of well-funded competitors or like Ampex, with an innovative but expensive product. You may be like Berners-Lee or Michael Hart with a different way of looking at the world. It doesn’t matter as long as you remember that vision resides with individuals and organizations all over the world.

Questions for discussion:

Do we have a product or service with great potential for the mass market, but that is like the VCR of Ampex…currently too expensive?

How can we encourage ourselves and our people to be visionaries by observing the world around them and connect the dots for new products or services?

From Shakespeare’s Othello to O.J. Simpson, from the Biblical Moses to Elian Gonzalez, the same set of deep, enduring archetypes resonate in people’s lives and minds. Organizations, that take the time to understand archetypal behavior such as that of the innocent, explorer and sage, can increase the purchases of their products and services by tapping into ancient emotions.

Ancient emotions played a huge role in O.J. Simpson’s murder trial. It shattered television ratings because viewers saw him as a fierce warrior who could defeat any opponent. Eventually, revelations of domestic violence cast him in the tragic mold of Othello, the warrior undone by the destructive power of his own jealous rage.

• Archetypes convey a meaning that make customers relate to a product as if it were alive in some way.

• Generally, the customer who favors an archetypal brand has no idea of why their emotions draw them to it.

• Knowing about the three most powerful archetypes will help you connect with your customer for greater market share.

Another underlying emotional example manifested itself when Elian Gonzalez, the young Cuban boy who became the subject of an international tug of war. Consciously or not, the story of the child adrift at sea reminded people of the story of the infant Moses floating in a basket in ancient Egypt.

Margaret Mark and Carol Pearson, authors of The Hero and the Outlaw suggest that organizations must realize that archetypes are the heartbeat of a brand because they convey the emotional meaning that makes customers relate to a product as if it were alive in some way. Nicknames develop between customers and archetypal brands…

• Apple’s known as “Mac.”

• Coca-Cola translates to “Coke.”

• Volkswagen’s Beetle is simply “the Bug.”

Nearly all consumers vaguely remember some glimpse of paradise. They relish some wondrous moment when the perfect life seemed possible. Let’s look at three archetypes that provide different strategies for the pursuit of fulfillment:

• The Innocent is like the lovely child or the wise mystic, filled with wonder at the beauty of the world and still believing it is possible to live in paradise. The Innocent looks for products and services that provide the experience of peace and goodness.
• The Explorer is driven by a sense of not belonging, like the Ugly Duckling seeking its own kind. From a marketing perspective, the Explorer looks for products and services that advance the journey of self-discovery.
• The Sage believes that paradise is the result of education and is not only about gaining knowledge and experience for its own sake; the Sage is about becoming wise enough to use prosperity to find happiness.

Innocent brands include Ivory soap, Disney theme parks, the Pillsbury Doughboy. They want the promise of a reliable rescue from an imperfect world.

The Explorer’s core desire is to have the freedom to find out who they are by exploring the world. From Homer’s The Odyssey to the simple desire to retreat into the wide-open spaces of nature, they constantly strive to experience the joy of discovery.

To appeal to Sage consumers, you have to establish credibility. The Sage’s core desire is the discovery of truth while using intelligence and analysis to understand the world. Examples include Socrates, Einstein, Harvard and MIT.

The concept may change in the names and the archetype formats. Nevertheless, the message is the same. To win, you must understand the customer on both a conscious and unconscious level and appeal to the strong underlying buying motives of their specific dominate archetype.

Questions for discussion:

What emotions could the products or services we offer trigger in our customer?

How can we market to directly touch those emotions and win more business?