In my line work (consulting) I run into all kinds of executive mindsets. In the publishing world, however, these mindsets tend to be rather stodgy at best, reptilian at worst.
Publishers don’t understand the web. And Seth Godin takes the New York Times to task, pointing out so many obvious misses and near-misses, that you have to ask why. Why don’t publishers get it? Why do they insist on playing it safe, even as their ship sinks below them?
Godin’s answer is right on target: “organizations are run by people who want to protect the old business, not develop the new one.”
This is what VG talks about as well.
In just about any large company, the people running the show are great at yesterday’s business, not tomorrow’s.
Please read Godin’s post >>
More Obama Lessons for Business
Bill George (yes, Medtronic’s Bill George) gives us a few more lessons learned from the Obama victory:
• Obama created a grassroots movement by building an ever-expanding organization of empowered leaders, who in turn engaged people from their social networks like Facebook.
• The entire organization was aligned around a single goal—electing Obama as President—and operated with common values (“Offer messages of hope, don’t denigrate our opponents, refuse to make deals”).
• Campaign leaders subordinated their egos and personal ambitions to the greater goal. Those who deviated quickly exited.
• Obama set a clear, consistent tone from the top (“No Drama Obama”), and never wavered, even when things weren’t going well.
• Obama’s greater mission transcended internal goals, such as fund-raising, endorsements, and campaign events, but each of these areas had goals tied to the greater mission.
• The campaign team used the most modern Internet tools to communicate, motivate, and inspire people and to guide their actions. Each day, 5 million people received personal messages from campaign headquarters or even Obama himself. This organization collaborated across a wide range of geographies and campaign functions, all tightly integrated nationally and executed locally.
Finally, just in case you missed the other business lessons, here you go >>
Shoshana Zuboff: Obama’s Victory is Capitalism 2.0
Writes Zuboff in BusinessWeek:
“This column is dedicated to the top managers of American business whose policies and practices helped ensure Barack Obama’s victory. The mandate for change that sounded across this country is not limited to our new President and Congress. That bell also tolls for you. Obama’s triumph was ignited in part by your failure to understand and respect your own consumers, customers, employees, and end users. The despair that fueled America’s yearning for change and hope grew to maturity in your garden.”
Years ago I remember reading Zuboff’s In the Age of the Smart Machine and thinking that no one in corporate management really wants real transparency… and that the information value-chain she described was doomed to failure.
Luckily, I was wrong. Now Obama will bring process transparency to government and business.
Asks Zuboff:
“…can we invent a business model in which advocacy, support, authenticity, trust, relationship, and profit are linked?”
“Yes, we must,” she concludes.
Read the article >>
And read her book: The Support Economy: Why Corporations Are Failing Individuals and the Next Episode of Capitalism
>>
Business Lessons Learned from President-Elect Barack Obama
What should the new President’s priorities be? Here are some views from a few CEOs interviewed by BusinessWeek:
It’s a cliche, but big business fears Democratic leaders. Turns out that Democratic presidents are better for the economy than Republicans! Details, details…
Jack Welch has his own take on why Obama succeeded: a clear vision, clean execution, and friends in high places.
A far more insightful piece comes from HBR blogger Umair Haque: Obama’s Seven Lessons for Radical Innovators. I don’t agree with all of his points (Obama did not “minimize strategy,” he minimized tactics!) but I do commend Haque for his insights (see this post, for example, on why Obama is the Google of Politics.)
Bill Taylor has a fun post titled: How Obama Became CEO of the USA — and What It Means for CEOs Everywhere
in which he argues that “being different makes all the difference.”
John Quelch says it’s all about better marketing.
Barbara Kellerman argues that Obama is a superior manager.
Gill Corkindale calls Obama The World’s First 21st Century Leader
For Stew Friedman, it’s authenticity.
My own view is that Obama is a true leader. And what we witnessed was the birth of Politics 2.0.
And in the end, it’s still about results, and to that end, Obama has already taken the first step.
Go Barack!
The Return of American Idealism: Political Reaction to Obama’s Win
Reaction to Obama’s win from politicians across the world:
UKRAINE: “Your victory is an inspiration for us. That which appeared impossible has become possible.” – Youlia Tymoshenko, Prime Minister
MALI: “The United States has given a lesson, a lesson in maturity and a lesson in democracy.” – Amadou Toure, President
ITALY: “Europe which is celebrating (the victory of) Obama must know that Europe be will be called on to be a producer of security and no longer merely a consumer. I think Obama will rightly call on us to take our responsibilities more seriously.” – Franco Frattini, Foreign Minister
BRAZIL: “In this case hope has won over prejudice — this is good for the United States and the world as a whole.” – Celso Amorin, Foreign Minister
RUSSIA: “The news we are receiving on the results of the American presidential election shows that everyone has the right to hope for a freshening of U.S. approaches to all the most complex issues, including foreign policy and therefore relations with the Russian Federation as well.” – Grigory Karasin, Deputy Foreign Minister
IRAQ: “I think you will hear a lot of discussion and goals and slogans during the election campaigns. When there is a reality check I think any U.S. president has to look very hard at the facts on the ground.” – Hoshiyar Zebari, Foreign Minister
ISRAEL: “Israel expects the close strategic cooperation with the new administration, president and Congress will continue along with the continued strengthening of the special and unshakeable special relationship between the two countries.” – Tzipi Livni, Foreign Minister
VATICAN: “Believers are praying that God will enlighten him and help him in his great responsibility, which is enormous because of the global importance of the United States…We hope Obama can fulfil the expectations and hopes that many have in him.” – Rev. Federico Lombardi, spokesman for Pope Benedict
PAKISTAN: “Your election marks a new chapter in the remarkable history of the United States. For long, the ideas of democracy, liberty and freedom espoused by the United States has been a source of inspiration…I hope that under your dynamic leadership, the United States will continue to be a source of global peace and new ideas for humanity.” – Yousaf Raza Gilani, Prime Minister
INDIA: “Your extraordinary journey to the White House will inspire people not only in your country but also around the world.” – Manmohan Singh, Prime Minister
HOLLAND: “The necessity for cooperation between Europe and the United States is bigger than ever. Only by close transatlantic cooperation can we face the world’s challenges.” – Jan Peter Balkenende, Prime Minister
FRANCE: “With the world in turmoil and doubt, the American people, faithful to the values that have always defined America’s identity, have expressed with force their faith in progress and the future. At a time when we must face huge challenges together, your election has raised enormous hope in France, in Europe and beyond.” – Nicolas Sarkozy, President
AFGHANISTAN: “I applaud the American people for their great decision and I hope that this new administration in the United States of America, and the fact of the massive show of concern for human beings and lack of interest in race and color while electing the president, will go a long way in bringing the same values to the rest of world sooner or later.” – Hamid Karzai, President
GREAT BRITAIN: “Barack Obama ran an inspirational campaign, energizing politics with his progressive values and his vision for the future. I know Barack Obama and we share many values. We both have determination to show that government can act to help people fairly through these difficult times facing the global economy.” – Gordon Brown, Prime Minister
KENYA: “We the Kenyan people are immensely proud of your Kenyan roots. Your victory is not only an inspiration to millions of people all over the world, but it has special resonance with us here in Kenya.” – Mwai Kibaki, President
CHINA: “The Chinese Government and I myself have always attached great importance to China-U.S. relations. In the new historic era, I look forward to working together with you to continuously strengthen dialogue and exchanges between our two countries.” – Hu Jintao, President
GERMANY: “I offer you my heartfelt congratulations on your historic victory in the presidential election… The world faces significant challenges at the start of your term. I am convinced that Europe and the United States will work closely and in a spirit of mutual trust together to confront new dangers and risks and will seize the opportunities presented by our global world.” – Angela Merkel, Chancellor
JAPAN: “The Japan-U.S. alliance is key to Japanese diplomacy and it is the foundation for peace and stability in the Asia-Pacific region. With President-elect Obama, I will strengthen the Japan-U.S. alliance further and work toward resolving global issues such as the world economy, terror and the environment.” – Taro Aso, Prime Minister
SOUTH AFRICA: “Africa, which today stands proud of your achievements, can only but look forward to a fruitful working relationship with you both at a bilateral and multilateral levels in our endeavor to create a better world for all who live in it.” – Kgalema Motlanthe, President
CANADA: “I look forward to meeting with the President-elect so that we can continue to strengthen the special bond that exists between Canada and the United States.” – Stephen Harper, Prime Minister
AUSTRALIA: “Senator Obama’s message of hope is not just for America’s future, it is also a message of hope for the world as well. A world which is now in many respects fearful for its future.” – Kevin Rudd, Prime Minister
NEW ZEALAND: “Senator Obama will be taking office at a critical juncture. There are many pressing challenges facing the international community, including the global financial crisis and global warming. We look forward to working closely with President-elect Obama and his team to address these challenges.” – Helen Clark, Prime Minister
INDONESIA: Indonesia especially hopes that the U.S., under new leadership, will stand in the front and take real action to overcome the global financial crisis, especially since the crisis was triggered by the financial conditions in the U.S.” Susilo Bambang Yudhoyono, President
PHILLIPINES: “We welcome his triumph in the same vein that we place the integrity of the US electoral process and the choices made by the American people in high regard. We likewise note the making of history with the election of Senator Obama as the first African-American president of the United States.” – Gloria Macapagal Arroyo, President
IRAN: “The president-elect has promised changes in policies. There is a capacity for the improvement of ties between America and Iran if Obama pursues his campaign promises, including not confronting other countries as Bush did in Iraq and Afghanistan, and also concentrating on America’s state matters and removing the American people’s concerns.” – Ali Aghamohammadi, aide to Ayatollah Ali Khamenei
PALESTINIAN AUTHORITY: “We hope the president-elect in the United States will stay the course and would continue the U.S. engagement in the peace process without delay. We hope the two-state vision would be transferred from a vision to a realistic track immediately.” Saeb Erekat, aide to President Mahmoud Abbas
And for a less pompous tone, here are a few statements from ordinary people:
LEBANON: In a Beirut restaurant, Miriam, 28, said her two brothers, both members of the militant Islamic group Hezbollah, saw Mr. Obama as a leader who was willing to take diplomatic risks to avoid military confrontations. “They think Obama will not damage the Middle East the way Bush did, and they were afraid if [John] McCain made it, the whole region would be in danger.”
BRAZIL: In Rio de Janeiro, documentary filmmaker Ryan Steers said Mr. Obama could improve the U.S. image abroad. “Obama is someone the world can trust. That is the most important thing for America right now: regaining its trust in the world community.”
KENYA: People danced in the streets in Mr. Obama’s ancestral village of Kogelo, and President Mwai Kibaki declared Thursday a national holiday. In Nairobi’s Kibera shantytown, carpenter Joseph Ochieng said, “If it were possible for me to get to the United States on my bicycle, I would.”
JAPAN: “Americans overcame the racial divide and elected Obama,” said Terumi Hino, a photographer and painter in Tokyo. “I think this means the United States can go back to being admired as the country of dreams.
Brand America Gets its Groove Back
Thanks Obama!
and
The Night of the American Renaissance
The American Renaissance has begun. Goodbye, Dark Ages…
Michael Porter: Why America Needs an Economic Strategy
“The stark truth is that the U.S. has no long-term economic strategy—no coherent set of policies to ensure competitiveness over the long haul. Strategy embodies clear priorities, based on understanding the strengths we need to preserve and the weaknesses that threaten our prosperity the most. Strategy addresses what to do, but also what not to do. In dealing with a crisis, experience teaches us that steps to address the immediate problem must support a long-term strategy. Yet it is far from clear that we are taking the steps most important to America’s long-term economic prosperity.”
That’s the Portermeister in BusinessWeek.
What he’s saying is Vote Obama 🙂
Video: “Vote Barack Obama” by Steel Pulse
We need a leader, a leader
To march on to Liberty
Get it Together
Vote Barack, Barack Obama…
MP3 here >>
Shaping Strategy in a World of Constant Disruption: How to Manage Your Business Ecosystem
In this month’s Harvard Business Review, authors John Hagel III, John Seely Brown and Lang Davison provide a road map for the daunting task of shaping strategy as technology-driven infrastructures constantly change.
The article is called: “Shaping Strategy in a World of Constant Disruption” and you can download it here (thanks Deloitte Consulting!) >>
In my view this is a very timely piece of thinking from my heroes JH3 and JSB (and Lang Davison). I’ll dig into it later this month on ecosystemwatch.com…
Wait, there’s more. Check out the podcast >>
Online Selling: Procter & Gamble Goes Direct to Fight Private Labels?
Don’t look now, but P&G is trying some direct selling online.
From the Financial Times:
Procter & Gamble is testing its ability to use the internet to sell its toothpaste, household cleaners and nappies directly to US households, in a potential long-term strategic challenge to its retail partners.
…The move brings P&G into direct brand competition with its retailers, underlining the extent to which e-commerce is contributing to changes in the way the two sides have traditionally worked with each other.
OK. The site is called theEssentials.com, but so far it looks like they have very little traffic.
Is this how they intend to fight the private label war? I’ll talk about them later this month on ecosystemwatch.com
The Republican Strategy
And of course there’s just plain hate >>
SNL Disaster: Sarah Palin Mocks Herself
This is truly amazing. The folks at SNL get VP candidate Sarah Palin to applaud a song which rips her to shreds… What was the McCain campaign thinking? Total and utter lack of judgment on their part.
Watch as SNL schools the McCain campaign:
Brilliant work by SNL. They get the ratings and trash the Republicans.
Retail Strategy in a Downturn: Pay Your Vendors Fast (like T.J. Maxx)
In BusinessWeek:
Industry observers say that while those retailers can take 60 to 90 days or more to settle up, TJX typically pays within 30. These days, that’s a critical selling point both to vendors, who are more concerned about finding funds to buy raw materials and pay expenses, and to the financers who act as middlemen in many of the deals. It could give TJX—which also owns discounters Marshalls and HomeGoods—an added advantage in getting a wider selection of items.
Makes sense. Can’t sell something that’s not on the shelf, Drucker used to say…
Read the article here>>
There’s another very good reason to pay quickly: goodwill.
Your suppliers will take an extra step or two for you if they know they can count on you. This “trust” makes a giant difference in execution.
There’s a software company I know which used to delay its vendor payments as much as possible as part of its strategy. While it may have gained a few bucks in capital, it lost in terms of responsiveness. Big time. Vendors would move extremely slowly to deliver value. It was frustrating on both sides. And all because a few “brilliant” bean-counters thought they had found a way to squeeze a few more pennies into the corporate treasury.
Retail Strategy: Tips from Peter Drucker
One of the great things about the late Peter Drucker is that he can be summoned to solve just about any problem.
One of my clients is a web retailer. They’re having serious issues with “customer hesitancy.”
And of course the headlines are now full of bad news in retail.
So we had a long chat about customer hesitancy. What makes the customer hesitant? Is it really the news on TV? Is it the fact that they might be out of a job?
My first piece of advice to them was straight out of Drucker: Stop selling and start buying for the customer.
Are you buying for the customer? Really?
That line of reasoning led to these predictable questions: so exactly who is your customer? Are there segments you aren’t serving that you should? Are there segments you should stop wasting your time with?
We were able to go and look at their historic web-sales data (for the past two years down to the last two weeks) to find out who their customers really were. And surprise, there was no customer hesitancy there!
All they needed was to focus on the right segment. We changed the website to do just that.
Listen to good old (in this case a younger, “1.0 version”) Drucker:
What Works in a Downturn: Purpose-Branding or Cause-Marketing
Despite the downturn, there is evidence that consumers are interested in “purpose branding.”
That’s the spin from Procter & Gamble’s Jim Stengel who (surprise, surprise) is leaving P&G at the end of the month to join a “purpose branding” consultancy.
Back-up data: In a study released this month, 26% of consumers expect companies to give more support to causes and nonprofits in an economic downturn, while 52% expect companies to maintain existing programs. Another 79% of consumers said if price and quality were similar, they would switch to a brand associated with a good cause.
OK, I’ll buy it.
And if your company is looking to do some cause-related branding, here’s a cool green company you should team up with: The Solar Electric Light Fund >>
USA: A Banana Republic?
Christopher Hitchens at Vanity Fair seems to think so >>
Downturn 2008: Harvard Business Review’s Survival Guide
And now, a survival guide from HBR.
My favorite entries:
– Why Entrepreneurs Love a Downturn
– How to Market in a Recession
– Staying Green in a Tough Economic Climate
– Three Steps to Innovating in Struggling Industries
– America’s Addiction and the New Economics of Strategy
– Beyond the Banking Crisis: A Strategy Crisis
– Hard Times Demand Teamwork — Not an MVP
Non sequitur: What is the difference between Palin and a Muslim fundamentalist? Lipstick.
Piracy and Cannibalism: Do Digital Downloads Reduce Revenue?
From The Economist:
In 2007 digital downloads accounted for 15% of global music sales compared with almost nothing in 2003. But the outlook for the music industry is worrying. Despite the growing market for digital downloads, music sales have declined over the past four years and are set to continue to dwindle, partly as a result of piracy.
BTW, does anyone really believe that Sarah Palin reads The Economist?
Slacker Uprising: Michael Moore’s Digital Distribution Model
Coming soon at www.slackeruprising.com>>
Note: The download is only available to those residing in the United States and Canada. In order to receive the free download on September 23rd, you must confirm that you are a resident of the United States or Canada.
Will this change the movie business? Or better, will it change our government?
Shoe Circus: Gates and Seinfeld take on Google, Apple – er, Goople
Here’s Crispin Porter & Bogusky’s attempt to “bring back” Microsoft:
It’s the first in a series of ads designed to fight Apple’s “Mac vs. PC” comedy show. Will $300 million do the job?
C’mon Microsoft! You can’t let Apple do this to you:
The scary thing is there’s so much more.
The way I see it this isn’t about Vista at all. It’s about the next wave of competition, about how Microsoft will compete against Goople – Google apps on Apple hardware!
The Montauk Monster Hoax Explained
Pick your explanation:
1. action photo of McCain vacationing on a nude lobbyists-only beach
2. pictorial representation of the Exxon CEO after the Lord smites him with a bolt of lightning
3. what happens when global warming attacks a sleeping Dick Cheney sans his top-secret-formula sunblock
4. FOX News’ ideal news story (far better than covering serious issues)
5. a plucked raccoon
What fun, this marketing of myths…
The War on Science: Bush takes scientists out of decision-making on species status
This administration is evil. They destroy life on earth every chance they get. All for a few bucks…
That’s what you get with the GOP: rubber stamps (er, dodos) for industry.
Scientists can now go suck eggs.
Heckuva job, Bush! Here’s your contribution to world history:
Arctic
Greenland ice sheet will virtually completely disappear, raising sea levels by over 30 feet, submerging coastal cities, entire island nations and vast areas of low-lying countries like Bangladesh
Latin America
The Amazon rainforest will become dry savannah as rising temperatures and falling water levels kill the trees, stoke forest fires and kill off wildlife
North America
California and the grain-producing Midwest will dry out as snows in the Rockies decrease, depriving these areas of summer water
Australia
The Great Barrier Reef will die. Species loss will occur by 2020 as corals fail to adapt to warmer waters. On land, drought will reduce harvests
Europe
Winter sports suffer as less snow falls in the Alps and other mountains; up to three-fifths of wildlife dies out. Drought in Mediterranean area hits tourism
Africa
Harvests could be cut by up to half in some countries by 2020, greatly increasing the threat of famine. Between 75 million and 250 million people are expected to be short of water within the next 30 years
Final note: so what’s a scientists to do these days? They can work on building invisible clothes for Bush and Exxon-Mobil executives.
And now, a word from our sponsors:
Global warming is brought to you by the Bush administration and is generously underwritten by Exxon-Mobil.
Nurturing Your Business Ecosystem: Lessons Learned from SAP
JH3 and JSB have written an insightful piece for BusinessWeek titled: How SAP Seeds Innovation: SAP’s collaborative Web sites and discussion forums give its customers ways to learn from SAP business partners as well as from each other.
So why does SAP succeed where others fail?
According to Hagel:
1) SAP generated its ecosystem, which consists of customers, business partners, experts and independent parties by addressing the needs of the participants
and
2) it focused on the needs of individuals, not just companies.
There you have it: people first.
Read the entire article >>
Drill First, Think Later
The Republicans continue their desperate smear campaign tactics against Obama. And once again they shoot themselves in the foot.
In TIME:
How out of touch is Barack Obama? He’s so out of touch that he suggested that if all Americans inflated their tires properly and took their cars for regular tune-ups, they could save as much oil as new offshore drilling would produce. Gleeful Republicans have made this their daily talking point; Rush Limbaugh is having a field day; and the Republican National Committee is sending tire gauges labeled “Barack Obama’s Energy Plan” to Washington reporters.
Too bad Obama’s point actually illustrates the total ineffectiveness of the Republican “Drill now, think later” mindset (underwritten by Exxon and friends)…
McCain’s “straight-talk” express gets derailed again and again.
For my part I am now permanently mad at the Republicans for their crimes against the earth.
Brand Obama vs. Brand McCain
Watching Ecosystems: a blog about marketspace analytics
Announcing our new blog at www.ecosystemwatch.com >>
The idea is fairly simple: If you don’t understand the ecosystem you’re competing in, you can’t compete effectively…
The blog will cover the following topics:
– Blogosphere
– Branding Ecosystems
– Business Ecosystems
– Business Models
– Case Studies
– Disruption
– Ecosystem Maps
– Industry Ecosystems
– Influencers
– Innovation Ecosystems
– Political Ecosystems
– Product Ecosystems
– Social Networking
– Strategy
– Value-Networks
This is a natural offshoot of our Ecosystem Intelligence™ service; take a look…
Why India Will Beat China: Transparency Wins!
The Conrad Group’s William Nobrega writes in BusinessWeek:
“The advantage comes in the form of an entrenched and vibrant democracy that will ultimately drive India to outperform China socially and economically. Messy, frustrating, and more often than not agonizingly slow, India’s democracy would seem to be chaotic at the surface.”
India will eventually outclass China because of its property rights, rule of law, and IP protection, says Nobrega.
Meanwhile in the US: we’re busy protecting the flag and burning the constitution…
Disaster Capitalism: Naomi Klein and the Truth
The Shock Doctrine – or how to use war and other disasters to make money for special interests like the oil lobby.
See more on how this “state of extortion” technique plays in the aftermath of Katrina, or the wildfires in the west, or the use of conserved lands for agriculture.
Now, that’s the truth.
The Commoditization of the Starbucks Experience
Here’s Howard Schultz in his now classic Valentine’s Day memo in 2007:
As you prepare for the FY 08 strategic planning process, I want to share some of my thoughts with you.
Over the past ten years, in order to achieve the growth, development, and scale necessary to go from less than 1,000 stores to 13,000 stores and beyond, we have had to make a series of decisions that, in retrospect, have lead to the watering down of the Starbucks experience, and, what some might call the commoditization of our brand.
Many of these decisions were probably right at the time, and on their own merit would not have created the dilution of the experience; but in this case, the sum is much greater and, unfortunately, much more damaging than the individual pieces. For example, when we went to automatic espresso machines, we solved a major problem in terms of speed of service and efficiency. At the same time, we overlooked the fact that we would remove much of the romance and theatre that was in play with the use of the La Marzocca machines. This specific decision became even more damaging when the height of the machines, which are now in thousands of stores, blocked the visual sight line the customer previously had to watch the drink being made, and for the intimate experience with the barista. This, coupled with the need for fresh roasted coffee in every North America city and every international market, moved us toward the decision and the need for flavor locked packaging. Again, the right decision at the right time, and once again I believe we overlooked the cause and the affect of flavor lock in our stores. We achieved fresh roasted bagged coffee, but at what cost? The loss of aroma — perhaps the most powerful non-verbal signal we had in our stores; the loss of our people scooping fresh coffee from the bins and grinding it fresh in front of the customer, and once again stripping the store of tradition and our heritage? Then we moved to store design. Clearly we have had to streamline store design to gain efficiencies of scale and to make sure we had the ROI on sales to investment ratios that would satisfy the financial side of our business. However, one of the results has been stores that no longer have the soul of the past and reflect a chain of stores vs. the warm feeling of a neighborhood store. Some people even call our stores sterile, cookie cutter, no longer reflecting the passion our partners feel about our coffee. In fact, I am not sure people today even know we are roasting coffee. You certainly can’t get the message from being in our stores. The merchandise, more art than science, is far removed from being the merchant that I believe we can be and certainly at a minimum should support the foundation of our coffee heritage. Some stores don’t have coffee grinders, French presses from Bodum, or even coffee filters.
Now that I have provided you with a list of some of the underlying issues that I believe we need to solve, let me say at the outset that we have all been part of these decisions. I take full responsibility myself, but we desperately need to look into the mirror and realize it’s time to get back to the core and make the changes necessary to evoke the heritage, the tradition, and the passion that we all have for the true Starbucks experience. While the current state of affairs for the most part is self induced, that has lead to competitors of all kinds, small and large coffee companies, fast food operators, and mom and pops, to position themselves in a way that creates awareness, trial and loyalty of people who previously have been Starbucks customers. This must be eradicated.
I have said for 20 years that our success is not an entitlement and now it’s proving to be a reality. Let’s be smarter about how we are spending our time, money and resources. Let’s get back to the core. Push for innovation and do the things necessary to once again differentiate Starbucks from all others. We source and buy the highest quality coffee. We have built the most trusted brand in coffee in the world, and we have an enormous responsibility to both the people who have come before us and the 150,000 partners and their families who are relying on our stewardship.
Finally, I would like to acknowledge all that you do for Starbucks. Without your passion and commitment, we would not be where we are today.
Onward…
So is Starbucks really turning itself around by going back to its roots?
John Quelch says some interesting things about Starbucks here>>
Are you listening, Krispy Kreme?
Video: Gerald Zaltman on Marketing Metaphors
How to Innovate like Google: Tom Davenport and Marissa Mayer
Two perspectives – one for Tom Davenport:
and the other from Google’s Marissa Mayer:
The “open-culture” thing is key. I wrote about this a while back in a not-so-subtle entry titled: “Google’s Product Development & Management Process Revealed” .
Greenwashing is the New Red, White, and Blue
How do you motivate your employees in this, the age of cynicism?
Instead of handing out Chinese-made flag pins to all their employees (yes, this actually happens) companies can start by supporting a few good causes.
The Economist has a nice write-up on companies taking this leap. A few examples:
– IKEA, the world’s largest furniture-maker, joins forces with Rainforest Alliance and WWF to promote forest certification in China by the Forest Stewardship Council
– Marriott International teams up with Conservation International and the Brazilian state of Amazonas to protect a big area of Amazon rainforest.
– Wal-Mart, the world’s biggest retailer, set up an ambitious programme in 2005 with the long-term aim of becoming a zero-waste, renewably powered enterprise.
OK. Does this mean that business is finally waking up to do the right thing?
Not exactly.
The real danger with the “greening of business” is hypocrisy, i.e. greenwashing:
So if your business is going to go green (and it should), make sure you don’t do it as a PR stunt.
If you do, your company just might end up here >>
Lessons Learned: Branding and Online Communities
Back in 2000 I was the leading an interesting experiment at one of the world’s largest software companies. The idea was simply this: if we build “communities of interest” around a specific topic (e.g. “database management,” or “innovation,” or “quality of experience”) we’ll be able to attract a significant number of our “target” audience and convert them to paying customers over time.
In a year and a half, we built seven distinct communities each supported by an ecosystem of vendors and partners. For four years we tried to make these communities work, and we did, with various levels of success. Along the way we learned several key lessons and I mention them here because while they seem basic, few companies ever seem to get them right:
Communities build Brand Equity
Unaided brand recognition for our company went from 12% to 84% within two years. Our “agency” did the survey and couldn’t believe the findings. Like most agencies, this one was focused on producing “creative” work rather than figuring out how to be useful to the consumer. Of all the sites we built, this was the only one which received “full funding” and was strongly supported ($) by the sponsoring business unit. It became a major hub in the ecosystem we were competing in, and we literally had about 50% of the “target audience” “opted-in” to our email newsletter. Furthermore, in terms of online referrals, this community accounted for as much as 40% (yes, forty percent) of referrals to the online store.
Communities are Self Segmenting
We learned we didn’t have to target or segment anyone. The content did the work for us. Because each community was “vertical” and concentrated on a specific subject, the only visitors we got were people interested in the topics we wrote about. In fact, the some of our more successful sites became the hub in the marketspace we were targeting.
Stop Selling, Start Learning
We didn’t push products on the sites. In fact, we tried hard not to sell. Instead, we focused on educational content from the world’s leading experts. The result, we had “stickiness” numbers even I couldn’t believe. On our best site, the average user spent over an hour per visit. And this number held up every month, for three years in a row. While we tried our best to teach, we also spent a considerable amount of time learning. I’d spend afternoons poring over site statistics – trying to figure out what was going on.
The 90/10 Rule applies
As we studied visitor behavior, we looked at content and author popularity, the clickthroughs and conversion rates, and resilience – which articles or discussions stood the test of time. Surprisingly, we noted that 5% of our authors drove 95% of our traffic. And 5% of our readers drove 95% of our sales. This was the pareto-principle on steroids (Richard Koch was right)!
Communities Drive Demand Generation
10X better than traditional online techniques like SEO and PPC. Our cost per lead was so low, our EVP of Sales couldn’t believe it. He became one of our biggest supporters.
Corporate Marketing is the Enemy
Don’t ever sell “communities” to a marketing department that thinks in terms of quarters and campaigns. As our communities took off, we experienced all sorts of difficulties, not from the outside, but rather from the corporate marketing staff. My boss believed that companies must drive traffic to their branded company URL, and not to a myriad of niche sites with funky names like linuxvalue.com (the site no longer exists, but it did work). Luckily my boss got zapped before I did, and I was able to keep the experiment going over four years and three different corporate marketing regimes. To this day, they don’t get it.
Forget the Wisdom of the Crowd, Focus on Thought Leadership
Communities are not necessarily social networks. We learned early on to allow the leading experts in the field to write about their pet peeves and passions. Sometimes they would come to “virtual blows” – one expert against the other – each presenting their views with wit and learning (and the occasional threat).
Manage the Ecosystem
After a year of slogging, we suddenly noticed that we didn’t have to worry about keywords or search engines ever again. We had become Google favorites. Almost anything we wrote about on any of the sites rose to #1 in Google and stayed there for years. Why? Because we had built a strong enough ecosystem- not a business ecosystem, mind you, but a consumer ecosystem. Our readers loved us. The experts loved us. Google loved us. What a game! All we had to do was focus on quality content. Our ecosystem became impenetrable. We had built a firewall against all competition. One example is particularly striking. Even after we stopped updating the site in question, we remained at #1 in Google for a highly competitive key phrase – not for a month or two, but for straight three years, after we had stopped touching the site at all!
There were a few more lessons we learned as well, but I think I’ve done enough jabbering for today. The end game for me was Double Loop Marketing™ and Ecosystem Intelligence™ – both direct offshoots of my time spent figuring out how to make communities succeed.
Viewer-Driven TV Programming – Is PBS serious?
I think it’s a nice gesture that PBS is asking viewers for programming suggestions:
What would your prime time lineup look like? Would you emphasize news and public affairs programming over science and nature content? Would you make changes to existing shows? What kinds of new series and specials would you bring to the public airwaves?
When they meet in Palm Desert, CA, the executives should take a look at the suggestions, but I feel they should talk to each other as well.
Why? Because there are serious limitations to heeding the Wisdom of the Crowd.
I blogged about Nick Carr‘s take on this subject a while back: “What crowds are good for is producing average results that are not subject to the biases and other quirks of human minds.”
The PBS bigwigs have forgotten their mission. (Maybe not, since a lot of them are now Republicans; I have to confess, when I heard about that I was sure we were soon all going to be watching infomercials on PBS 24/7).
So let’s remind them what public television stands for. What’s the brand personality they need to be faithful to?
Seth Godin weighs in on this issue with a brilliant post about the purpose of the New York Times. Same deal for PBS.
So let’s ask: What’s important? What’s true?
Big opportunity for big stories, PBS. Go where the corporate media can’t go:
News, Education, and the Arts. And don’t forget to add “Global Warming” as a new category.
PBS, you knew that once.
Look what happened to Ted Koppel and Nightline. Or David Brinkley’s This Week. I’ll Fly Away. That’s commercial television. PBS, please don’t go there.
One more thing: make sure every show is archived online for viewing over the Internet. All the way back to the very beginning of PBS (including Mr. Rodgers’ Neighborhood). That would be a real public service. Heck, put ’em all on YouTube.
I’m a fan of customer feedback, but I’m a bigger fan of the customer experience.
Don’t mess this up, PBS.
Ranking Business Gurus: The Librarian’s Dilemma
Tom Davenport has done it again. He’s come up with a list of top business gurus in Rupert Murdoch’s Wall Street Journal.
Using the same methodology he used in his book, Tom tells us that things have changed. These are the new Big Idea
Why all boys? Because the business world still seems to be sexist? Or maybe the women thinkers aren’t focusing on “selling” their ideas as much? Where’s Dorothy Leonard-Barton? Or Tammy Erickson, for that matter?
The Times has its own list of business gurus.
Accenture still points to the 50 Gurus that Tom Davenport came up for them a few years ago.
God is in the details. The issue I have is that Tom and H.J. have not really taken into account how Google works. They’re measuring quantity, not quality.
In terms of popularity, no one uses Lexis Nexis or the SSCI database, except for academics and librarians. So I’ve got to discount those two components of the guru index.
Let’s get less academic and try to measure who’s really getting attention. (By the way, Tom has a great book on that subject as well).
So to measure real-time popularity, here’s what I propose: let’s measure the influence network for each of these management gurus. Let’s see how far their reach extends in the ecosystem they’ve built with their ideas. Let’s look at who’s linking to them. Let’s look at their site traffic. Let’s compare their ecosystem rankings. Let’s take Google, Yahoo, and the blogs into account.
Stay tuned. We’re going to have some fun using our ecosystem mapping tool.
Steve Jobs’ 2005 Stanford Commencement Address
The Steve Jobs story: follow your curiosity, not your curriculum!
Why did Tata buy Range Rover and Jaguar?
Interesting analyses. We are going to see many more such mergers.
India and China are buying up brands.
We are going to see many more such mergers. These are “learning-acquisitions.”
Let’s see what Tata can teach Jaguar, and vice-versa. Value-engineering? Haven’t heard that terms since the 1980s…
The Ghost of Tiananmen: China, Tibet and the Olympics
When I was a kid in India, one of the fondest memories I have is of a family vacation in the foothills of the Himalayas – eating at a tiny Tibetan roadside dhaba, being fed tons of cho-cho-momo and heaping piles of noodles. The food was great, but what struck me was the poor Indian peasant family sitting across from me eating their fill as well. Why? because the food was so cheap and so good that everyone could afford to eat well. I’ve never forgotten that day.
The family that ran the dhaba were refugees from Tibet, and I was fascinated by the store, the food, and the way they used an abacus to add up the transactions as they happened. That day I became a believer in a free Tibet.
I wrote earlier about China’s country branding issues and the upcoming Olympics.
I’ve also written about how to measure democracy with the “Journalists-in-Jail Index.”
And now we have pictures of the Chinese government beating up on Tibetans splashed across the pages of every major newspaper and magazine.
And don’t forget YouTube:
Here we go again.
This time Chinese officials are blaming the Dalai Lama for the violence. Give me a break. They’ve even got an army of bloggers and hackers working the media sites posting “pro-chinese” accounts all over the place.
Bush, of course, is silent. He knows that China’s in Tibet for the uranium.
I get a feeling the sponsors of the Olympics are in for a rough ride. Here are the brands which stand to get a black eye:
Coca-Cola
McDonalds
General Electric
Visa
Johnson and Johnson
Kodak
Samsung
Panasonic
Atos Origin
Lenovo
ManuLife
Omega
And let’s not forget the Olympic brand itself. This could do it in completely!
Stay tuned and sign a petition>>
UPDATE: More video >>