47 days and counting ... what have we learned?

Tuned In will hit the bookstores on June 27. It's been doing very well in pre-orders, hitting the top ten lists of Amazon and Barnes and Noble a couple of times in the 30 days since our first preview in The Pragmatic Marketer. Craig, David and I are just starting to hit the road with a full event calendar of keynotes, briefings and online interviews. You can keep up with all of the progress at www.tunedinbook.com and maybe connect in with some associates.   

One of the activities we like to do during any launch of a new product is to be careful not to go completely in to 'tell' mode but reserve some time for listening. As most of you know by now, a major key to success for tuned in businesses was the time they spent observing the market and discovering unresolved problems. We've got some early indicators of a trend I wanted to share with you this week and get your feedback. 

Tuned In seems to be developing an affinity with small business owners as a philosophy for managing their business through the current recessionary climate. 

We're taking a step back and wondering what to make of this. We wrote the book to be a foundation for any business in any industry and in any situation. We found companies following the process and succeeding in horrifically down markets -- like the current real estate market -- and in hot, competitive markets -- like wireless technologies. Following the process enabled their businesses to grow faster, become more profitable and develop strong customer loyalty.  The question we're asking now is whether or not this is particularly true if you're small and the economy is weak. 

Kristin Zhivago has been writing a multi-part analysis of how to transform your company ("recession proofing") in her RevenueJournal blog. It seems to me that the things she is writing about (and in reality what we putting forth in Tuned In) is that the foundation had best be solid when times get tough. I've always said about the people I've worked with that "you never know what you have and who they are until you get into a crisis situation with them".  It is only when times are tough that their true colors show through. People (and businesses) seem to always return quickly to their core under pressure.

So, perhaps our timing is perfect with the launch of Tuned In as the market might be more receptive to a focus on building a solid foundation that will enable them to survive this downturn. Certainly, many of the stories in the book are about businesses that created a dominant position out of situation where the market was less than receptive. We're convinced that you can as well. 

What do you think?  Does Tuned In resonate best with small businesses in tough times?   

It's The Experience Stupid!

"Some people make money on the screen, but we decided to spend ours on the gaming experience. It's an investment ... not simply to improve the market, but to disrupt it."
-  Satoru Iwata, CEO of Nintendo

Nintendo reported its fiscal year results last week. Ho hum. $3.3B in profit and a nice tidy growth of 142% year-over-year. Sales of its new star product offering, the Wii soared, beating expectations by more than 53%. They expect to sell 25M units in the upcoming year. Meanwhile, Microsoft and Sony posted disappointing results in their competing offerings. Microsoft's gaming division lost $228m and Sony's Playstation continues to languish behind in sales. Why is Nintendo winning?

We think they're great example of tuning in to create a breakthrough experience.

Far too many companies limit themselves in development to producing a product that solves only one component of the problem they've observed in the market. There is another level to get to these days and it involves tapping into the perspectives that your buyers build about the 'experience' of doing business with you. We're seeing the trend time and time again.The key to a product that breaks through in today's market is not how clever it is or a unique capability that it offers vs. the competition.  It's much more aligned to how simple it is to create an enjoyable experience.

The Wii is remarkably simple. Easy to setup and use and provides an environment for a whole family to play and be entertained.  Two weekends ago, I thoroughly enjoyed an evening at home with my 8 year old daughter, 19 year-old daughter and her boyfriend, my wife and my parents (ages withheld due to privacy concerns). We spent hours playing golf, tennis, bowling and baseball with my 8 year old's Wii. Not a one of us had any issues learning how to use the device (no weird joysticks or some other device to master a complicated game). It was as simple as simple could be.    

Simple is smart!

So how do you create simple? Interestingly enough, the behavior we studied in Tuned In that is driving these companies is the opposite of what you think. It's not as much about understanding the nuances of the technology to be developed or what the competitors are doing, it's much more about tapping into what we call the marketplace of 'potentials'--people who have yet to buy anything in the product category--and figuring out how to provide an experience that will attract them. It's what Scott Anthony calls the growing market of "nonconsumers" and it's fueling a whole new generation of breakthrough products. 

When you study the potentials, really study them, you'll develop a much more complete picture of all the little things that are barriers to adoption. Breaking down those barriers is the single most important thing to focus on if you want to create resonators like the Wii. And once you do it, the key is to keep focusing on the next level of barriers and the next wave of potentials. Just this month, Nintendo announced an extension called the Wii Fit, a "Balance Board" that enables you to use your Wii for things like Yoga. Wow. This has the potential to capture a casual user (maybe Mom and Dad) and turn them into passionate daily users. 

It IS the experience that you should focus on. The title of this post is a rip-off from Jim Carville's famous mantra for Bill Clinton's first presidential campaign (It's the Economy Stupid). I apologize for that but in today's environment with so many competing visions for what you should be focusing on, we felt like the analogy was an appropriate one. Forget about the many things wasting your time and focus on the one that matters ... create a simple experience that new buyers will embrace! 

Don't Try to Fix Your Weaknesses

"You can't put feathers on a dog and call it a chicken."--Dr. Phil McGraw

Bumped into a great new manifesto this week on ChangeThis. David Rendall, author of The Four Factors of Effective Leadership turned out a very bright and clever perspective on the fallacies of fixing weaknesses. With an in your face title The Freak Factor: Discovering Uniqueness By Flaunting Weakness, Rendall encourages you to stop spending time trying to fix the things you aren't good at it and maximize your strengths. He cites a Gallup survey that said 59% of us believe that fixing weaknesses is an essential part of personal development. Is it for you? 

Well, how's that working for you? 

I had to laugh at some of the stories and descriptions of folks trying to push rocks uphill on their own personal transformations. And, the power of just ignoring them and moving on.  Rendall clearly points out the problem:

1. Fixing weaknesses is a slow, painful process. 
2. We don't enjoy anything about it. 
3. It distracts us from activities where we could make significant progress and find fulfillment.
4. It doesn't actually work. Even if we fix it, it doesn't become a valuable strength. 

There are so many places I could go with this. We definitely found that Tuned In leaders and Tuned In businesses had the DNA built in to them that almost oozed 'we are who we say we are and we aren't trying to be anything else'.  The authenticity seemed to make it easier for them to execute in every facet of their business and create a unique platform for positioning themselves well in the market. 

But, what about the rest of us who aren't there yet?  Rendall got me to thinking about how much time we spend in upgrading products by adding features that address the latest complaints. Or hiring people into the company to fix a discipline that you are executing poorly.  Or teaching technical professionals how to be more people and sales-oriented. Or sales folks to be more technical. To what end?  Does it ever occur to us that maybe there is an underlying reason to begin with that is hard to change and maybe not worth changing? 

I love one of the 'Freak Facts' buried in Rendall's manifesto ... "every weakness has a corresponding strength." Find it and you can begin the process of creating something valuable and unique for not only yourself but also for your business. The simple fact is that we are always intrigued and attracted to the ones that stand out. But, we seem to have been educated more often than not to be similar and well-rounded. Why?  Mediocrity is never rewarded in the long run. Getting the growth, profit and satisfaction rewards we saw with those who got Tuned In always had a little bit of the Freak Factor built in to them.

 

Are you a sales guy?

I've noticed that over my twenty years in the business world, titles for sales guys have become ever more grand and difficult to understand.

My first business card said "Sales Representative" and my friends in sales at other companies had the same thing or something similarly descriptive on their business card.

Now I see things like "Business Development Director" or "Client Care Specialist" or even "Marketing Manager" on salespeople’s business cards. Many of these titles seem a bit sleazy – a bait and switch sort of thing to hide the fact that the person is in sales. If your company is tuned in, why do you need to hide the fact that you're in sales?

Several weeks ago I keynoted the Home Theater Specialists of America conference in Rancho Mirage, CA. At the event, I met several people from SpeakerCraft including Jeremy Burkhardt, the company president.  Jeremy and his company are tuned in and they are honest.

Jeremy's bio on the company site says, among other things "Perfect Day-wake up at the beach with my son, surf then wake board then sky dive then snow board then jump in the plane fly to mile marker zero at the Grand Canyon and white water raft to camp where we would eat and sleep under the stars." Honest man, that Jeremy. At the conference, he rode a skateboard from building to building at The Westin Mission Hills.

I was amazed when I received Steve Hayes’ business card at the conference. He works at SpeakerCraft too. His title? "Sales Guy."

Funding New Ideas

How do you get new ideas funded today?  There have been some interesting posts this week on the topics of How to Fix Venture Capital and Why opposing the  Northwest/Delta merger is dumb. Both got me to thinking about a fundamental problem we seem to have today in business. Whether I look at from the bottom-up as an entrepreneur or from the top-down as a big company executive, it seems to me that the very engine that drives our economic growth is in jeopardy.

When did we become so risk averse to new investments?

It's almost as if we equate new investments these days with money up in smoke. And breakouts like Google or Salesforce.com as more luck than anything else. In fact, as Umair Hague points out in his Harvard Business Review blog on the Edge Economy, many really big ideas were funded to be acquired in the last decade. He asks a pretty poignant question ... what if Google had taken the $3B it was offered in 2002 when it was half the size of Yahoo and became the search product line of one of the big three portals? His challenge to the VC industry is to embrace the environment that allowed them to emerge as a platform for growth of the industry with all of their investments. 

Similarly, Greg Strouse looked at the problem from the other end and asks incredulously why anyone would speak out about the dangers of Northwest and Delta merging. Putting aside paid special interests creating mouthpieces on news shows, why would we have any fear that putting two failed big companies together would negatively impact the customer? The markets have consistently shown that this type of end of life cycle mergers only spawn bigger opportunities for new entrants to emerge. Do we think that noone out there is capable of creating a new kind of carrier that can deal with the realities of high fuel costs and a buyer demanding more flexible services? 

Unless we're afraid that we no longer have the stomach to find, fund and launch new ideas. 

This seems to me to be the single biggest thing to worry about in the economic environment we have just moved into. Short recession, long, non-event ... who knows?  But, the relatively speaking continual decline of new offerings being launched to market is eroding our global advantage as a leader. Rather than whine about it though, I'm thinking its time to align to the new realities of a conservative investment community and begin to pragmatically identify real 'tuned in' ideas for funding.

The process we discovered and documented in our book seems to me to be the perfect filter in todays environment for funding a new idea. It focuses on finding a discrete problem in a target buying audience that is quantifiable ... and then adds the innovation to create an experience and marketing idea that will resonate authentically with it's audience. Why is this a great approach to run your new investments through?  Because it filters out fads and finds fundable ideas that are sustainable.

Every success story we uncovered in our Tuned In research had these fundamental elements at their core. They also had leaders, teams and yes ... investors ... that bought into the mission and embraced it for the long haul. Maybe it's time we started following their lead. If you put your new idea through the Tuned In filter, it's much more fundable!   

Tuned In Partnerships

I've been watching the news around Yahoo, Microsoft and Google lately with great interest and wondering about the wisdom of the strategies behind each of moves and counter-moves being made. This week Yahoo and Google announced a partnership to consolidate their search advertising businesses (assuming a successful test of the concept). The markets yawned, expecting little to no change in the market positions of each.   

Why do so many partnerships fail?  Estimates are that 80% or more leave the companies worse off than when they started. Unfortunately, that really only measures the strategic ones ... mergers and acquisitions ... not the plethora of agreements that cover joint product, service, marketing or even distribution relationships.

It always seems like a good idea. Rather than develop the capability yourself, leverage a third party with the expertise your firm lacks (or is non-competitive). Faster time-to-market, lower costs and the ability to provide your customers with a whole product solution make the business case for combining a 'no brainer'. But then reality sets in. Culture clashes. Product overlaps need to be resolved. Execution suffers when the customer facing organizations realize they have different objectives and selling models. Management struggles over control with an equal zest for leading the change and maintaining status quo of their pet projects. 

We've been studying how the Tuned In model applies to these kinds of scenarios and found that it provides a great filter for making the go/no go decisions that uncover the 20% that are not only good ideas but executable:

1. What market problem is the partnership solving?
2. Will new buyers be attracted?
3. What is the incremental impact of the change to existing customers, employees or partners?
4. Which part of the overall experience will be better?
5. How will you communicate a powerful new idea that the partnership brings to the market?
6. Can each company still maintain (or improve) their ability to establish an authentic connection with potential new buyers? 

In truth, most partnerships fail because these questions are never asked. And, fundamental misalignments are overlooked. This is mostly because many partnership strategies are developed inside-out ... in the boardroom using only financial analysis as a filter ... or in some cases fear of avoiding the alternative.

So, how do the big three rate on the Tuned In filter? Well, I'm suspicious that it's not very well. Nothing in their communication to the marketplace thus far has even addressed the core issues of creating new value for the market or offering new solutions. It's only focused on fixing problems Microsoft has with its MSN business or Yahoo has competing in search or Google has if the other two merge. How will this make their businesses or consumer value better off?   

How about your partnerships?  Are they Tuned In or Tuned Out?