Bridging the Gap by Nick Rice

03:48 pm | 0 recommendations | Be the first to comment

Ideal Client Mix

The more I learn about small businesses, the more I’m surprised about the shaky foundation on which they build their businesses. Owners risk so much for their yet they often put themselves at greater risk because they choose not to market consistently.

Overwhelmingly, when people discover that I’m a marketing coach they proudly state, “I’ve built my entire business on referrals. I’ve never had to spend a penny on advertising.” And my response is typically, “That’s great, advertising rarely generates a big return for service businesses anyway. And I applaud you for providing a service valuable enough to get people talking. So tell me, how do you get referrals on a consistent basis?” That’s when they usually stop dead in their tracks. They realize that referrals are not predictable; they realize that they are not in full control of their own business--and that's a scary discovery for a business owner.

Now let me be clear; referrals are great! They are vital to your firm’s growth. They are the easiest business to close and they are typically less price sensitive than other buyers. You should ALWAYS strive to do your job well enough to get people talking about you and your services to friends and colleagues.

That said, the ideal client mix for a professional service business is 50% referrals and 50% new business. And by new business, I mean clients that would not have otherwise come to you without encountering one (or more) of your marketing tactics. So what’s your percentage? How much of your business do you ultimately control?

Referrals are going to happen (or not) when you provide service beyond expectations. Referrals are next to impossible to control. You can’t magically turn on the referral switch and get new business when you need it. So while they are great business; you shouldn’t let referrals totally control your business. You need to proactively grow your business in addition to working with referrals.

You need a reliable system in place for generating new leads and attracting new clients. By balancing referrals with proven marketing strategies, you can potentially double your business if your current mix is 100% referral-based.

Just for a minute, assume you keep your current level of referrals and you elevate your new business marketing efforts to get closer to the ideal 50/50 split. What would that mean for your business? What would that mean for your personal goals?

Having a marketing engine that consistently creates more opportunity than capacity allows you to choose better clients and better projects.

What I’ve discovered is that most people simply don’t understand how to market their business. They’ve never had any training (other than a few books) or they simply get distracted by the details leaving their big plans to collect dust. In addition to referrals and advertising, there are many more marketing options.

BNI is "the world’s largest referral organization.” Each week thousands of businessmen and women around the world get together to proactively drum up referrals for their business. Earlier this year, they asked their members about their marketing strategies. Here are the results (in order of weight as of March 2008):

BNI Marketing Strategies

• Referral Marketing - 41.6%
• Direct Marketing - 17.6%
• Web Marketing - 9.9%
• Direct Mail Marketing - 5.8%
• Email Marketing - 5.5%
• Print Ads - 4.8%
• Other - 4.2%
• Public Relations - 3.8%
• Telemarketing - 3.1%
• TV/Radio - 2.8%

So even in BNI, a group that purposefully built to generate referrals, members are still spending over 50% of marketing efforts on other strategies. But here’s the kicker, BNI members are missing out on some of the most effective marketing strategies available for professional service businesses.

Just look at the focus on direct marketing, direct mail, print ads, and tv/radio; those strategies are basically marketing number games. The response rate for those strategies is so low you need tens (if not hundreds) of thousands of contact names on your prospect list to make it worth your time and effort. We’re talking about a 1-3% response rate on those strategies.

If you’re in a professional firm, you are selling your knowledge, expertise and ability to solve client problems. Chances are you have hundreds, maybe thousands, of people in your contact list or address book–no where near enough to play marketing number games. Not to mention, it’s very difficult to explain the value of your intangible service offering with traditional advertising. You need a different approach; you need different options.

I've seen 11 proven marketing strategies. You should select the top three to five strategies that are best suited for your unique goals and personality. These are “big bucket” strategies that can have hundreds of different tactical executions apiece. The 11 strategies include (in alphabetical order not effectiveness):

1. Advertising (paid placement of message, incl. sponsorship)
2. Articles & Publishing
3. Direct Outreach (one-to-one direct mail, email, phone calls)
4. Keep in Touch (newsletters, auto-responder email)
5. Networking (events, lunches, committees, Board of Directors
6. Online (SEO, banner ads, webinar, registration forms, blog)
7. PR (earned media/press mention)
8. Referral (Word of mouth, viral marketing)
9. Speaking, Presentations, Workshops
10. Special Events (host seminars, open house, customer events)
11. Strategic Alliance / Joint Venture

Let's take Networking for instance; as an overarching strategy, you can network at local Chamber events, professional groups, church, alumni clubs, civic organizations, and online networking sites like LinkedIn or Facebook. You can join boards, country clubs, mastermind groups or service clubs. But, to take advantage of networking (or any of these strategies), you need a plan. You simply can't show up and expect to get business.

Each of these marketing strategies has been proven to work. But some are more effective than others. Notice that advertising and referrals are both solid strategies; but they’re not the only options you have "get your name out there". And I like I said before, mass marketing tactics like advertising works best with businesses with mass market appeal. The very nature of a service business has a targeted audience.

The small business owners I talk to want a tangible return on their investment of time, money and energy into marketing. Everyone has unique goals, but one of the most common goals that I encounter in professional service partners is the desire to be seen as an “expert” in their field. They want to elevate above their competition and be recognized as a leader in their industry. If this goal resonates with you, one of the most potent combination of marketing strategies you can employee is Writing, Speaking, and Networking.

Think about who you look to as leaders. How do you tap into their knowledge? Where do you find them? Chances are you buy their books; or read their articles/white papers; or see them speak at a conference. Experts purposefully select marketing strategies that allow them to capitalize on their knowledge and “thought leadership.” Now, this is just one example. You have to pick strategies that excite you and are best suited to reaching your specific goals. If you can’t get excited about speaking, chances are you won’t actively work your speaking plan.

In closing, I want you to think about your business and your goals. If you have a business built 100% on referrals and it's delivering everything you've ever dreamed of, I congratulate you. But if you have a business dependent on referrals and the stream is dwindling down or you yearn to take the business to the next level, you must become a better marketer. You need to balance your referral stream with new clients. By becoming a better marketer, you can get closer to the 50/50 ideal client mix.

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Nick Rice

I work with successful business owners who struggle with marketing and want to get more clients with less effort.
Download my free report, "7 Principles of Attracting More Clients" at http://www.nick-rice.com

02:44 pm | 0 recommendations | 3 comments

Is the Opportunity Real?

We’ve all been in that sales situation where you think you have it wrapped up and at the last minute it stalls. They stop returning your calls and emails, all correspondences are very short and to the point, the RFP is hanging out there, it seems like your prospect has simply fallen off the face of the earth.

So what happened? Were they not an ideal client or part of your target audience? Was there secretly a competitor with an inside track or existing relationship (hint: there usually is, but that’s a different ezine topic)? Were they simply shopping to see what’s available in the marketplace?

It could’ve been any of those, and more, so today I want to introduce a framework to help you evaluate each opportunity - before you commit to chasing it. I can’t claim this model as my own, though I’ve adopted it in my daily client interactions.

When I got serious about understanding consultative sales, multiple colleagues recommended I pick up Mahan Khalsa’s book, “Let’s Get Real or Let’s Not Play.” And I recommend you read it as well. The short version of the story is that Mahan is responsible for sales performance at FranklinCovey, the Seven Habits folks, and this book shed more light on how modern sales work than anything I’ve read. When I read a recent ezine from Mahan, I knew I needed to share some of his wisdom with a little bit of “Nick Rice practicality” thrown in for good measure.

When you are presented with an opportunity for a new project or new business, you need to uncover as much as possible to gauge how successful you will be with this project. If you try to fix every problem that presents itself, you will never be seen as a specialist, and as such, you will never command high fees. Generalists stay busy with small projects, but when the client wakes up and decides to fix the big problem, who are they going to call?

So, how do you uncover such details? At a high level, you have to ensure that three things are present before you can properly evaluate an opportunity. Here is the Opportunity Framework:

Opportunity Framework

First off, you have to know that there truly is a problem to solve or a result to achieve. You cannot help someone that doesn’t admit or realize that something needs to change. It doesn’t matter if you know beyond a shadow of a doubt that there’s an issue; if you cannot get your prospect to see it and admit it, you’re wasting your time. On the flip side of this, it has to be a problem worth fixing or a result worth achieving. Organizations live in a constant state of brokenness - and that’s okay as long as they are still profitably functional. Some problems are worth fixing, some are not. Realize that as soon as possible and move on.

The second item to uncover is the prospect’s ability to make and act upon a decision. There’s nothing worse than someone who cannot make a decision and move on it. If you’re running into this, chances are you’re not talking to the real decision maker or you’re not helping them paint a picture of what life could be like after fixing the situation. If you work with large organizations, know that junior level managers and staff love to keep consultants and sales people busy. They like the power trip. And it makes them look productive to their bosses. You need assurance that the person you’re working with can say yes to your proposed solution before you invest a lot of time and energy.

The third leg of this stool is ensuring that appropriate resources are available to address the issue. Resources can take the shape of budget dollars, staff availability, executive oversight, equipment - anything required to make the solution a reality. If there’s not enough budget or internal staff resources, the project will never get off the ground. If you cannot get commitment from a certain executive for support, you’re on thin ice. How can you be successful without appropriate resources?

If any one of these three items is left unknown, you put the project and your success at risk. Chances are you’re going to waste a lot of time when this initiative stalls at some point in the future.

We’ve all seen good opportunities with no budget. We’ve all seen executives than cannot make a decision. We’ve all walked into a client’s office and almost tripped over the problems in the organization. If you are someone that wants to be recognized as an expert in their field; someone that wants to truly provide the best solution to the client’s problem; you owe it to yourself to slow down enough to uncover all three parts of an opportunity. And don’t be afraid to walk away if the opportunity isn’t ideal. You should only work in an environment where you are set up to succeed. If the project isn’t right, it isn’t right and now it’s time to move on.

You cannot expect the client to simply lay all of this out on the table for you. You have to dig. You have to ask the right questions to bring these issues to the forefront - and in doing so you will separate yourself from 98% of the other sales people out there. Too many people simply jump at what’s presented in an RFP or what’s said a meetings as gospel without digging any deeper. Clients want and expect you to ask tough questions. They want to know that you fully understand their issue inside and out before presenting a solution.

When you approach each opportunity as a chance to find the perfect solution for your client - whether it involves you or not - you’re doing the right thing. And Carma has a way of rewarding those that do the right thing. In order to understand the problem and propose the perfect solution, you need to know all three parts of an opportunity.

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Nick Rice

I work with successful professional service firms that struggle to attract new clients and want to take their business to the next level. Download my free report, "7 Principles of Attracting More Clients" at http://www.nick-rice.com

03:02 pm | 0 recommendations | 3 comments

Excellence versus Perfection

Michael J. Fox once said, "I am careful not to confuse excellence with perfection. Excellence, I can reach for; perfection is God's business." Those words rang true as soon as I read them.

Early in my career I was a graphic designer for a local university. I was responsible for creating text books and classroom materials for the International College of Dentistry - super exciting work by the way :). Like any job I had deadlines to meet with the editors, publishers, printers, etc... One day I caught myself going back to tweak the layout for a certain book. That particular book was printed six months earlier and currently in use in Dental Schools throughout the Middle East. But here I was futzing with margins, font spacing and the like.

Something made me stop and think about what I was doing. Why in the world was I messing with a text book that would never be reprinted? I had other things to work on, but internally I was going nuts because I knew I could do a better job than I had originally. Mind you, there was nothing wrong with the final published book. It was great. Everyone signed off on my designs and loved it. Not to mention that it was a critical component of actually training and producing dentists. It was working.

And in that moment I realized that I was a "tweaker". My edits had nothing to do with my audience. They were strictly for my own benefit and justification. I wanted better margins simply because it was the right thing to do in my mind. Tweaking was a constant thread in my professional life for years. And to this day I still fight the urge to pull up a logo I designed nine months ago, or a strategic plan that I helped write with a client and make a few tweaks. It's just a part of who I am.

But a few years ago I realized that tweaking was just for me - not my clients - most of the time they never saw my tweaks anyway. When I did bring my revised files to a client, they would look at me like I just handed them a moon rock. You could see it in their eyes, "What is this? Why are you bringing this to me now?"

After more than a few of those interactions, I decided that perfectionism doesn't work for me. In fact, it was actually hurting my client relationships. They had moved on. I was obsessing. I was the crazy consultant or designer that couldn't let go. So today, I actively strive for excellence.

Excellence is something completely different than perfection. And it took me a long time to fully understand how powerful and good simply being excellent was. For me, perfection was the top. It was it. Anything else seemed like failure. I look back now and realize how silly I was to think that being excellent meant failure.

And here's the funny thing that all perfectionists know - perfection isn't possible. If it isn't possible, why keep killing ourselves to reach it? If it isn't possible, why even think and act like it is? Why assume that nothing else will suffice? Why do we set ourselves up for a letdown?

Being excellent is attainable. It's not always easy, but it is doable. Excellence doesn't mean that you're sacrificing your soul. It doesn't mean anything other than excellent. And how can that be a bad thing?

When you strive for perfection, you shoot yourself in the foot right from the start. You've given yourself a goal that's unreachable. You will never be satisfied with the end result and that creates a type of myopia. You cannot see past perfection. Perfection holds you back from reaching your true potential. It's a constrictive way of being. Perfection costs you more than you realize.

And here's the kicker - no one expects you to be perfect. People expect you to strive for excellence. Excellence is what people pay for. It's what people really want from you.

Being recognized as excellent in your field is the key to success. So I encourage all of you perfectionist out there to take a few minutes and look at how your never-ending quest for perfection affects your life and relationships. Is it helping or hurting you? Are you getting what you want?

If you're open to looking at it from another angle, ask yourself these two questions:

1. If it were impossible to be perfect who would I prefer to be?
2. If I could be the new way, what would things be like? What would happen?

If you're like me, you'll find that the new way of being is much better than the current constrictive way. Once you come to that realization, life and work take on a whole new meaning.

Like I said, I still fight the urge to tweak, but recognizing how it affects me and actively striving for excellence has allowed me to be more productive, more effective and happier. And that's something that most New Year's resolutions can't beat.

BTW, There are probably spelling and/or grammar mistakes in this blog post. And that's okay. I've spell checked it and I've re-read it and now I'm sending it. I want it to be right, but I also know that I can spend hours obsessing over every detail and it won't go out until tomorrow or the next day. Hopefully a few grammatical errors (if you catch them) won't keep you from thinking about what I've said. So here goes...

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Nick Rice

I work with successful professional service firms that struggle to attract new clients and want to take their business to the next level.

http://www.nick-rice.com

11:07 am | 0 recommendations | 2 comments

Marketing Communications Vocabulary

Being on the same page with regards to vocabulary is one of the most effective ways to ensure that your projects come in on strategy, time, and budget. A while back, Ernie Mosteller did a great job of boiling down the basics with this marketing communications vocabulary. It's just as relevant today as ever.

Brand. Your brand is your personality, as determined by how the world sees you. How you want to be seen can affect how the world sees you, but it doesn't define it. The world gets to define its own take on you. Lots of things go into what the world sees of you. Your brand = (what you want it to be) + 2(X) what the world says it is. The world's actual view of you is at least twice as important as your desired view of you. As the world's view of you becomes more negative, X gets larger. As it becomes more positive, X shrinks.

Design. Design is not your brand. But it can affect your brand. Design is the clothes you wear in order to attempt to affect the world's perception of your personality. It may also be the car you drive, or the house you live in. It's your outward, visual, projection to the world. It may or may not have anything at all to do with who you really are -- though good design is always based on what's inside. Design can, and should, touch everything you do that the world sees. Which, basically, is everything.

Advertising. Advertising is not your brand. Advertising is what you say about yourself in order to attempt to affect the world's perception of your personality. What you say can also be defined as: how you act in public. Which is, everywhere. What you say about yourself is greatly affected by how you say it, because how you say it determines whether people will hear and/or listen. Whispering in the middle of an NFL stadium doesn't have the same effect as shouting in church. If I were you, I wouldn't do either. Advertising, by the way, is no longer defined as the placement of a pre-determined message in a purchased medium. Advertising is any piece of communications with an agenda.

Public Relations. PR is not your brand. PR is an active attempt to get other people to say something positive about you, without directly paying them to do so. Because this definition is so broad, and so clearly goes light years beyond churning out a press release, you can safely assume that I believe PR is pretty much anything, and is an integral, specialized component of quality advertising. PR is also the component you need to turn to for crisis management, assuming you're managing the crisis honestly. Because almost anything else has a real chance of making things worse.

Collateral. Collateral is not your brand. Collateral is reference material for people who have already expressed an interest in your brand. Whether it's a business card or brochure, collateral has almost no ability to create interest in you. Its function is to enhance interest, and provide information, for those who have already decided (if even in a small way) to check you out. Most websites function as collateral, though they are capable of a lot more.

Concept. A concept is no longer simply a storyboard, or a headline/visual relationship. A concept is an idea designed to encourage a specific action from the person who interacts with it. A concept could be an event, a direct mail piece, a Super Bowl commercial, a You Tube video, a boy band, or a newspaper ad. The key to making a concept work is to focus your attention on the desired action from the viewer, and simplify that action to its most basic element. A concept doesn't sell a car. A salesman sells a car. But the right concept can get someone to talk to a salesman. Or click a link. Or remember the car you have for sale, the next time they think about buying one. Good concepts surprise people. Great concepts hold their attention. Effective concepts are very specific, and very simplistic, about what they want to achieve.

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Nick Rice - I work with successful professional service firms that struggle to attract new clients - http://www.nick-rice.com

09:41 pm | 0 recommendations | 3 comments

Your Biggest Obstacle: You

Regardless of your role within your business, you have goals. You may own the place and set them yourself or you may have a boss that walked in and laid them out for you. Either way, there are things that need to be accomplished before year’s end or within a few years.

Reaching some goals is pretty easy so I’m not going to talk about low hanging fruit here. I’m going to talk about a goal that either scares you to death or exhilarates you. Take a moment to think about that big goal and answer these questions:

* What would it mean to you if you actually achieved it?
* How would you act differently after achieving it?
* What would you take on that you’re not currently?
* What would you leave behind?
* Why is the goal truly important to you?
* What’s standing in your way of achieving it?
* Why haven't you achieved it yet?

I know those questions aren’t always easy to answer. But think about how empowering it is to know the answers to those questions. Think about how good it would feel to be on the other side of achieving your goals and being the answers to those questions.

Now, let’s focus on what’s standing in your way.

Do you have the skills necessary to reach your goal? Do you have the time? Do you have the energy? Think about what’s holding you back. If nothing is standing in your way, I’d contend that your goal isn’t big enough. Think bigger – dream a little. If you have an income goal that seems well within reach, think bigger. You want your big goal to be attainable, but just out of reach. You want it to scare you a little bit.

More often than not, we have a mental block around what we can achieve. For some people, there’s never enough time. For others, they’ll never be educated enough or experienced enough. The psychological barrier stops them from moving forward. The attainable goal becomes unreachable and they decide to focus on something else like cleaning their office or tweaking their website. Unfortunately these delay tactics sabotage our future and they stifle our ability to reach our true potential.

We’ve all heard the stories of the uneducated kid that went on to be the top salesman. Or the working mother raising four children while making a six figure income from two jobs. Or the serial entrepreneur that seems to have the magic touch and every project turns to gold. For these people, failure is not an option. It’s not in their vocabulary. They do not let limiting thoughts enter their mind. They have a big and very clear vision for their future and nothing is going to hold them back.

As a business owner, you may have a goal in mind, but you may not be sure how to get here. One thing is for sure, what got you where you are today probably won’t get you here you need to be. If business growth is your goal, you have to become a better marketer. You know that you should promote your services, but there’s always seems to be something that pops up. There’s always billable work that needs to be worked on; and of course, the office could always use a little cleaning. A lot of business owners are mentally blocked then it comes to marketing their own services. And it seems easy to justify. After all, a steady stream of referrals isn’t a bad thing. No, it’s not a bad thing; but let’s go back to your goals - your vision for your business. Is your referral flood generating enough business to get you where you want to be? To quote Michael Gerber, “are you working on your business or in your business?”

The good thing about mental barriers is that they can be broken down. I spend a lot of time with clients determining their barriers to marketing and helping them turn it around. The process isn’t difficult, but it does require you be honest with yourself.

Your goals mean something. They’re the future of your business - and life. They are your hopes and dreams for your firm. And there are consequences for not achieving them - mainly in the form of lost opportunity. It may seem difficult to quantify lost opportunity. Yet in my experience, you can quantify almost every aspect of your goals; you just have to keep digging. When you start looking at the lost opportunities that result from burying your head in the sand when it’s time to market, you realize that your business could be completely different. You begin to realize that you’re leaving a lot of money on the table by staying in your comfort zone. If you could no longer think those negative thoughts about marketing, you’d generate more opportunities for growth and profit.

Think about who you would be if you couldn’t think limiting thoughts around marketing your business.

If your biggest obstacle is mental, don’t let that slow you down. Whether it’s getting more training to develop the skills you need or simply changing the way you think about marketing, you control your own destiny. The key is to take action now. Stretch a little outside of your comfort zone. When you dream big about your business and imagine living the life you’ve always wanted, you’re not going to let a little thing like a limiting mindset hold you back, are you?

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Nick Rice - I work with successful professional service firms that struggle to attract new clients - http://www.nick-rice.com

02:24 pm | 0 recommendations | Be the first to comment

Innovation: This Post is All About You

Isn't that what we all want? In this overloaded world of information and advertising, don't we just want it to be all about us for a change?

Throughout my career in corporate America and consulting, I've seen it more times than I can count. The big cheese doesn't want to leave any opportunities on the table and thinks that if she could just get her message out to a broad enough audience people would buy. Think again, the average US adult is bombarded with an estimated 3000+ advertising & branding related message EVERY DAY.

There is very little chance that your marketing message can cut through that clutter. So today I'm going to chat a little about the benefits of niche marketing. It's not a new idea, but too few are willing to take the perceived risk.

Most of the US GDP is made up of service companies. 99% of the time, a service company will depend on the quality of its reputation to get business. And more often than not, that reputation is very much driven by the people in the business. It's driven by the quality of service that YOU provide each and every day. The services economy is ultimately driven by its ability to solve problems. The list of service providers is long, but here's a few: attorney, doctor, electrician, architect, IT, developer, engineer, consultant, coach, banker, designer, trainer, planner, etc... All of the roles are built around solving a particular set of problems.

A funny thing happens when you realize you have a problem - especially a major and costly problem. You want the best in the business to fix it. And for the especially hairy headache-inspiring problems, you don't particularly care how much it costs to fix it - as long as it's fixed quickly and the return on your expense is around the corner. Think back to the list of service providers above; illness, security, safety, attrition, sales, purchasing, real estate and divorce, whatever... There are a ton of problem out there looking for a solution. Once you become aware of the problem, you start looking for the expert to help you fix it.

The shift to niche marketing makes logical sense. After all, we're all consumers of services. We've all needed a plumber at one time or another. But for some reason, a lot of executives don't believe their business fits the mold for niche marketing. They feel like they're leaving too much opportunity on the table.

Perhaps a greater reason behind the aversion to niche marketing is that it forces your organization to truly understand your client's challenges and issues - and be able to prove that you can fix them. When you move into the white collar realm of services (especially marketing and advertising) it can seem difficult to quantify results. But much like hesitating to niche message, the ability to quantify results is almost always there if you know the right questions to ask and how deep to probe. Most people stop questioning too early and wonder why they can't make a stronger business case.

Ironically, everything that scares a lot of business owners about choosing a niche is what allows them to most efficiently reach their business goals. By staking claim of a niche market - and proving that you can solve specific problems - you can create more opportunities than capacity. When you have more opportunities, you can increase your fees and close business with less effort.

Ultimately, no one can serve everyone. And that's what broad vague internally-focused messaging attempts to do. Put some thought into your niche. It doesn't exclude you from taking on work outside of that segment; but it does give you the best opportunity for profitable growth.

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Nick Rice - I work with successful professional service firms that struggle to attract new clients - http://www.nick-rice.com

03:16 pm | 0 recommendations | 1 comment

Design: When Simplicity Complicates...

I stumbled upon this while surfing my normal "kick off the week with design" RSS feeds. It's from Art Lebedev Studios and is a little over the top at ~20 inches long. There's no way that one would be able to find the appropriate channel button quicker than with a normal 10 button remote.

Sometimes form is better than function, but then it becomes a fashion statement instead of something useful. I do love the gradient buttons denoting sections of 10. But anywhooo...

Nick Rice | Nick Rice Consulting | http://www.nick-rice.com

07:11 am | 0 recommendations | Be the first to comment

5 Steps To The Conversational Economy

It's no secret that the web is moving to a conversation platform. That's one of the major check boxes for all "Web 2.0" apps online. You can have a 2.0 look (big fonts, clean simple design, and gradient color buttons), but to truly be 2.0 you have to build your site around information sharing and user contribution.

Well that's easy to do if you're a start-up. But what's the benefit to Fortune 500 companies that are decades or centuries old? It's hard to wrap your head around this paradigm shift if you've been pushing information out to your customers for the last 20 years. In the old model, a company would buy enough airtime and/or print advertising to throw their message out in the market. It was a shotgun approach in the purest sense. Even as media-scarcity started to disappear, new targeting models came about to direct budget dollars to more appropriate medium. Think cable TV versus network or niche magazines versus the NY Times.

The good part was that you had a better shot at your audience seeing your message, but the message was still pushed out to the audience. Focus groups and the occasional talk to a sales person was the primary method of hearing what was going on with customers.

We all know the world has changed. The TV industrial complex is all but gone. That's not to say that no one will ever advertise on TV again. But we now understand that the expense rarely generates a worthwhile return on budget dollars. And there's only one true mass market TV event - the SuperBowl - and that has pretty much sucked from an advertising point of view for the last few years.

The music industry is falling apart. Why would a band sell their souls to a record label when they can get online distribution on their own? When was the last time you walked into a CD or record store and bought something? The world has changed.

Ten years ago we had no idea what Amazon and eBay would do the marketplace. They built systems around trust - not to mention the innovations around warehousing, shipping and distribution. Trust comes from real people giving recommendations, ratings, comments and reviews. It's not new. It's just enabled by global technology networks today.

So where do you start? How do you get on the bus? And guess what, if you don't you'll continue to see your profit slip. You'll continue to get bashed on Technorati (didn't know that was happening did you?). And you'll continue to feel the seismic shift underfoot until you fall in the crack.

So, here are my five ways you can start to revamp your business around the conversational web:

1. Make it easy for consumers to talk about you - good and bad.
If you sell products, let users submit reviews and ratings on your site. If you're making good products, you shouldn't have to worry because you'll see glowing reviews. If not, you've most likely found the source of your profitability or marketshare issues.

2. Customers are always right.
Even when they're wrong, in their heads, they're right. You have an opportunity to educate them but at the end of the day, they choose whether to stay with you or leave. You cannot control that. How you handle the education part makes a big difference in their decision.

3. Stop trying to please everyone.
Make an awesome product for one segment. Dominate that group of users. Turn them into your biggest advocates. When you try to make something for everyone, you end up with mush. Think Apple. The only way to survive the conversational web or economy is to have people talking about you. They can either love you or hate you, but if you're stuck in the middle, you're toast.

4. Understand that each customer counts.
Like Chris Anderson said, "the ants have megaphones." You have to recognize vocal supporters and address vocal critics. One bad review by an influential blogger and you've lost untold revenues. People don't trust mass media. They trust people like themselves. And if you feel like addressing individual users is too much hassle, you now see how far you have to come to participate in the new marketplace.

5. Do something worth conversation.
I'm not talking about a press stunt. I'm talking about developing products that people love. I'm talking about delivering service that is delightfully unexpected. Simply meeting expectations doesn't count anymore. There are too many options to pick from. That mentality comes from a scarcity mindset and we live in an abundant world. Create joy. Make a difference. Get people talking.

10:27 am | 0 recommendations | Be the first to comment

Apple COO on Apple

Here are some snippets from Tim Cook’s speech at the Goldman Sach’s Technology Investment Syposium from late Feb. (from Mac Rumors)

How do you keep innovating?

…I would say is our corporate culture is a very simple culture. We hire people who want to make the best products in the world and provide an atmosphere to challenge each other to make the best products. And that’s deeply embedded in the DNA of the company. …. I can tell you this is why people come to work at Apple.

How do you view the market for the iPhone?

The traditional way that all of us were taught in business school to look at a market was you look at the products you are selling, you look at the price bands that are in the market, you think of the price band that you product is in and assume you can get a percentage of it, and that’s how you get this addressable market. That kind of analysis doesn’t make really great products. The iPod would not have been brought to market if we had looked it that way. How many $399 music players were being sold at that time? Today the cell phone industry, a lot of people pay $0 for the cell phone. Guess why? That’s what its worth! If we offer something that has tremendous value that is sort of this thing that people didn’t have in their consciousness, it was not imaginable… I think there are a bunch of people that will pay $499 or $599 and our target is clearly to hit 10 million and I would guess some of those people are paying $0 because its worth $0 and willing to pay a bit more because its worth more.

How do you handle the loss of a senior exec?

Apple is an amazing company, and I didn’t fully understand until I got there, how amazing it was. And the feeling of not getting weighed down by bureaucracy, and politics and all the ancillary things that any businesses are. So this atmosphere is a very very unique kind of atmosphere and frankly, we don’t have an issue attracting people to work there, and we have so many things going on and innovation is so deeply embedded in this place. While you may see 5-6 or 10 people being most visible, the company is full of off-the-charts smart people. We’ve had some executive departures, but as a grown-up company does, we planned good succession, and I think you can see from our results, the products have kept coming.

It’s obvious how much Apple respects their customer (or should I say legions of mac addicts) and their employees. I’m continually amazed, given their formula of success, how other large companies scoff at Apple. In today’s world cost-cutting is viewed as an innovation. It’s bad enough to focus your efforts internally for growth (as compared to what really drives top line growth - delivering what customers desire on top of an outstanding experience), but when you skip right past your people and only look for cost targets how do you ever expect to right the ship.

I know there’s not an easy or a quick fix. But today’s executives have to actively evolve their corporate culture, their internal DNA, to focus on real long term growth strategies. You only need to focus on two things - your customers and your employees. And by stating that “our employees are our greatest asset” in your mission statement doesn’t cut it. You have to prove you mean it. Set your employees free to innovate, let them really converse with customers. Then you’ll see loyalty and growth from both parties.

If you don’t believe me, look at the Fortune 500 list from 1995. How many of those companies are still on there? How many are still in existence? Einstein said it best, “No problem can be solved from the same level of consciousness that created it.”

Do something different or accept your fate as the dinosaur grazing while a meteor is barreling down with you in it’s crosshairs.

Nick Rice • Lexington, Ky • nick@cre8tivegroup.com • www.cre8tivegroup.com

04:54 pm | 0 recommendations | 6 comments

Meet the world

From brazilianartists:

Caro Doria is Brazilian, 25 and has been working for the magazine Grande Reportagem, in Lisbon, Portugal, for the last 3 years. He is part of the team that produced the flags campaign which has been circulating the Earth in chain letters via e-mail.

Angola

Brazil

Burkina

China

Columbia

EU

Somalia

United States

Nick Rice • Lexington, Ky • nick@cre8tivegroup.com • www.cre8tivegroup.com