How To Think When Planning A New Marketing Campaign

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Friday, 8.48pm

Sheffield, U.K.

Never write an advertisement which you wouldn’t want your family to read. You wouldn’t tell lies to your own wife. Don’t tell them to mine. – David Ogilvy

What do you do when thinking of marketing a new business or idea?

If you follow the traditional approach you start with a plan – and writing that plan requires researching and understanding your market.

But what does that research look like?

One way to approach the task of research is to look at it as a scientific problem.

You have a population out there and you can segment that population using various characteristics – geography, income, job titles and so on.

Once you study your population – little humans suspended in a vat of solution you can come up with your campaign – say a social media or search engine ad and let it run and a percentage of the humans will make their way towards you like iron filings towards a magnet.

This system works – after all many people have successfully used it to market their businesses online and offline.

So, surely you can use it as well?

Well… there are a couple of issues that are worth understanding first.

I was listening to Jim Collins being interviewed on the Tim Ferriss show.

It’s a fascinating episode and you get a chance to listen to a management legend – someone who has built a career on studying companies using methods like the ones described above – positivist ones.

Collins and his team study huge amounts of data, coding them and pulling out insights – which is how he identified a set of companies that outperformed others in his book Good to Great.

But, the problem is that despite all that data the characteristics that made the sample companies great only describe what they are – and are little use when thinking about companies not in the sample.

Taking the picture above, the insights you get about the samples in A cannot be generalised to include the samples in B.

Why is that?

That’s something a paper by Lee and Baskerville titled “Generalizing Generalizability in Information Systems Research” goes into in some detail.

To cut a long story short you can study a thing and say things about what you see and the measurements you make.

But what you can’t do is prove that what you learn or believe is going to apply to other things.

It’s something called Hume’s truism.

You can assume, guess and try it out – but you can’t generalise – say it’s generally true that if you do what you did in A you get the same result for B.

Which is what Collins says as well: “The books never promised that these companies would always be great, just that they were once great.”

So, what’s the second way of doing your research.

Well, you need to do what the experimenter is doing in vat A – jumping in and getting involved in the situation.

If you’re trying to engage with people – trying to get them to listen to your pitch about what you do then your starting point is to understand them by living the way they do.

Sort of like ethnographers of old used to do – go and live in societies to understand their customs and rituals.

And that’s what you need to do – go to the people you want to talk to and understand how they live and ideally, live it yourself.

That kind of research doesn’t try and generalise – it tries to understand.

It doesn’t use stats and conversion ratios but looks at people and appreciates them for what they are.

And I don’t think you can play games like saying you’ve created personas so now you understand the market and what you need to do.

Now, of course, bosses want results and want them quick.

So just buy that list and send out some emails.

But if you really want results you’d be better off learning how to do good quality research.

Research that seeks to understand – not from a distance but by getting up close and personal.

It’s a bit like a celebrity who spends a night out in the open to get an appreciation of what a homeless person goes through.

That’s better quality research, from this point of view, than a pile of papers written in a warm, cosy study about the nature of the homeless experience.

If you want a name for this kind of approach we can borrow the term Genchi Genbutsu from the Toyota Production System.

Which means Go and See what is happening for yourself.

Cheers,

Karthik Suresh

What Is The Purpose Of Your Marketing Communications Activity?

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Thursday, 8.25pm

Sheffield, U.K.

Evil begins when you begin to treat people as things. – Terry Pratchett, I Shall Wear Midnight

We have been so thoroughly indoctrinated into the world of scientific thinking that it’s hard to imagine any other way to approach the world around us.

Marketing communications, for example, is about how you talk to prospects and customers.

The textbook on my shelf says that it is a “… planned, integrated and controlled interactive dialogue with key target audiences…”

In other words, the writers believe there is an audience out there and you can plan and control how you talk with it.

Except, there isn’t an audience. There are people – individuals – who make decisions about how to interact with what you put into the world.

You have no control over what they do.

Or do you?

There is an industry built on the idea that you can get people to do what you want by being very clever about the way you create your marketing material.

But clever in the sense of doing what – what’s the intent?

I suppose you can look at intent along a line with two extremes.

At one end you’re looking to educate your prospect.

At the other you’re trying to manipulate them.

Let’s say you’re trying to write a direct mail letter.

One purpose of your letter could to explain the features and benefits of your product to a reader so they can make an informed choice.

Or you might have a load of unsold stock that you need to unload and the purpose of the letter is to get some mugs to send in their money and take your tat.

I suppose if you find yourself in the second position it’s worth taking some time to reflect and ask if that’s really what you want to be doing with your life.

If you’re good at what you do – writing marketing copy, for example – do you feel good when it is used in that way?

But there’s another thing to consider – and that’s the medium you’re using and how well you’re using it.

The medium you use invariably affects the message you create.

You’re going to create a very different message if you’re sending a letter than if you’re creating a TV advert.

And the thing about the medium is how you use it.

Good email marketers, for example, try and make things clear.

Novice marketers spend more time on look and feel, assuming that such things have an impact.

On most mail clients, however, images are suppressed and all you get is the text that remains – which is often too poor to stand on its own and usually ends up in the junk folder.

So you could look at the medium as another continuum and ask whether your use of it is confused or clear.

A confused approach relies on throwing lots of stuff out there and hoping the magic of conversion ratios works.

It’s about as annoying an approach for the recipient as having the sender attached to your legs and having to drag them around all day.

A confused approach that seeks to educate probably ends up turning people off.

A clear approach that seeks to manipulate might work – but not in the long term because people hate being duped and will not give you a second chance.

Sometimes I think that people who suggest that you create a strategy to target an audience have never really had to target an audience of their own.

Because, if they had, they would realise something that writers have known for a while.

You don’t write for an audience.

You write to one person – and sometimes that person is yourself.

If you do a good job that person will understand what you have to say.

Warren Buffett, for example, starts drafting his shareholder letters with the words ‘Dear Doris and Bertie’ – writing to his sisters to tell them how he has been managing their investment for the last year.

He doesn’t try and address thousands of shareholders – by focusing on a couple his message is focused and amplified rather than diffused and incoherent.

Marketing, when it comes down to it, is a conversation between you and another person.

Your intent is to educate.

And whatever medium you use, you need to try and keep it clear and simple.

The rest, as they say, will take care of itself.

Cheers,

Karthik Suresh

Why Do We Never Think Of Managing Conflict Situations?

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Wednesday, 8.35pm

Sheffield, U.K.

To fight and conquer in all our battles is not supreme excellence; supreme excellence consists in breaking the enemy’s resistance without fighting. – Sun Tzu

Many of you reading this have probably read Sun Tzu’s quote and nodded approvingly.

An slightly more amusing one comes from a play by Wole Soyinka I read decades ago: “…in time of trouble it behoves us to come together, to forget old enmities and bury the hatchet in the head of a common enemy”

All I remember about that time was, alongside being involved in plays, I saw my first Siamese cat and ate my first battered prawn.

But, we digress.

Let’s talk about children instead.

Children are interesting: little people with boiling emotions simmering close to the surface.

They haven’t learned to protect themselves yet with a thick, hard crust that keeps everything under control.

When they’re upset they erupt, emotions flowing through gaping cracks, anger everywhere.

And the thing is when we grow up we’re not really that different.

Yes, we hide it better, but underneath the surface those emotions swirl away, still hot and turbulent and ready to come out.

But for many years our theories of management assume that people are really rational.

I have been recently introduced to the book Rational Analysis for a Problematic World edited by Jonathan Rosenhead and in the first ten pages he points out that the way we make decisions misses something very important.

If you have any experience of markets, for example, you’ll have heard people talking knowledgeably about decision making under things.

Like decision making under risk and decision making under uncertainty.

With risk, you know what could happen and will happen if one of those things did happen.

Sort of like betting on horses.

With uncertainty, lots of things could happen but because there is some kind of pattern you can be more confident that some things will happen rather than others.

Sort of like the weather in the next day or so.

Anyway, Rosenhead has a paragraph that describes this using quite technical language that brought up images of the recent Jurassic Park movie, which I then tried to explain to the little person sat next to me.

When you make decisions under risk it’s like having to make a decision about a dinosaur fossil – it’s pretty safe and just sits there and you can poke it and prod it and nothing’s going to happen.

Decision making under uncertainty is like having to make a decision about a live T-Rex, but one that’s been thoroughly sedated and is sleeping in front of you.

Not quite so safe, but you’re confident nothing bad is going to happen.

Real life decisions, however, involve dinosaurs that are wide awake and looking at you menacingly and end, as most of the movies of the genres do, in conflict.

And so really we should spend a LOT MORE time studying how to make decisions under conflict situations.

And the picture above is a start at mapping the relationship between conflict and outcomes.

Let’s try it with experiences with kids that you’ve either had or likely will have.

If you and your child end up in a shouting match you both lose.

It’s no fun and you could just end up stomping away from each other.

That gets increasingly likely as they get older and bigger and more bloody minded.

If you can still dominate them you might win – but it’s not going to make them feel better or leave you feeling good.

That’s the thing about battles – no one wins.

What happens if you avoid conflict – but use emotional blackmail or passive-aggressive methods instead?

Again, no one ends up happy. Bosses that try to avoid conflict rarely have happy staff – all that bottled up emotion gets let out somewhere else – where it doesn’t do any good.

The best way to resolve a conflict is not to fight and to have both parties win.

Which is why Sun Tzu’s remedy is at best temporary.

If you defeat an enemy without fighting you still have an enemy.

You need to think better.

And so perhaps the best quote that sums up the approach you could take when trying to manage decision making under conflict comes from one of those little people again – probably from a programme they watched on telly.

“Daddy,” said the little person, “how do you defeat an enemy?”

“I don’t know. How do you defeat an enemy?”

“By turning them into a friend.”

Cheers,

Karthik Suresh

How To Measure What Really Matters For Understanding

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Tuesday, 9.02pm

Sheffield, U.K.

A bad system will beat a good person every time. – W. Edwards Deming

I am not a fan of measuring and tracking things.

I might be at first – it’s interesting building a new system to log data, for example, but eventually the work gets tiresome and it’s easy to stop.

The thing is that is seems like an essential part of success.

The psychiatrist Raj Persaud in his book Motivation says you need three things in order to be successful – goals, resources and monitoring.

I don’t think he explains these in great detail – as to what exactly is meant by these terms.

Goals, for example, are problematic.

Are goals aspirational – things you hope to attain one day – like peace of mind?

Or are they specific and time-bound – like saving enough money for a house deposit in 9 months?

And what’s the difference between a goal and a target?

Let’s assume that you have a goal – however defined – what do you need in order to achieve it?

If you want to make lots of money but have no capital then is that a problem?

If you haven’t got the skills or experience to develop an app is your goal to be the next Microsoft realistic?

And then what exactly are you measuring?

If you’re counting money are you focusing on output rather than activity?

Revenue or profits are not going to go up just because you want them to.

Now the reason this issue is problematic is because you’ll find yourself in this situation again and again.

Every time you do a project you’ll need to figure out what your goal is, what you need to achieve it and how you are going to report on progress.

It’s very easy to do this the wrong way.

The wrong way starts by setting an arbitrary goal.

For example you decide that you’re going to blog daily and set a goal to write 1,000 words per day.

Is setting that goal enough – is the universe now going to move heaven and earth to make that happen?

Or are you going to have to allocate resources – allocate time for writing.

As Mary Heaton Vorse said “The art of writing is the art of applying the seat of the pants to the seat of the chair.”

If you’re also very dedicated then at the end of each writing day log how many words you’ve written and see if you’re on target and, if not, work harder.

That sounds entirely reasonable, doesn’t it?

But that approach which seems on the surface normal and sensible hides many problems.

The first thing is that you can set goals for yourself – that might be ok.

But if you’ve picked a goal that is not based on data – what happens when you keep failing to meet your goal?

Do you give up, work harder or change the goal?

If it’s not a goal you’ve picked – if it’s been assigned to you and, worse, if your income depends on meeting that goal what are you going to do?

This happens quite a lot with salespeople.

They are set an unachievable target which they sign up to because any salary is better than no salary.

Then, they either manage their numbers so they can hit their targets or work their time planning to fail and then leave to do the same thing in another role.

If you don’t find yourself agreeing with any of this you’re not alone – we are conditioned as a society to believe that goals are good and setting aspirational goals – stretch goals – is the way to motivate and improve.

It’s just that all too often the opposite happens.

So, what should you do if you really want to improve?

That starts with understanding what’s going on – by understanding the voice of the process.

Let’s go back to that blog example.

A few years ago I decided to write every day – when I could anyway.

That, I suppose, was a goal or a target.

I tried setting myself wordcount goals – a few hundred words, maybe 500.

But I quickly got bored and stopped counting.

The way I write and publish, however, means that isn’t a problem.

As the sources are all in text files we can use simple UNIX tools to analyse them.

It didn’t take much time at all to count the words in each post and chart them as shown in the picture above.

I’ve been lazy and drawn averages and upper and lower control lines rather than working them out – because you can see what’s going on pretty clearly.

For the first 300 or so posts the average word count was around 500 – with a peak of little over 1,000.

In the next 200 or so days the average is closer to 600, with the exception of an excitable period where the posts seem a little longer – I can’t remember why.

The point is that this data is the voice of my writing process.

It’s not being collected actively but it can easily be created from the process itself.

There’s no logging required.

This shows that I can write between 600 and 800 words in a sitting most of the time.

As measurements go that’s quite useful for understanding how my process works.

The same approach – getting measurements out of activity without manual logging is what makes devices like the Fitbit and Apple Watch a good idea.

And wouldn’t it be nice if you could do your day to day work and all the metrics could fall out of activity without you doing anything – so that you could understand what normal looks like?

Because the point is this – once you know what normal looks like you can work on your system and try to improve it.

And the improvements will show up in your measurements, not because you’re trying to achieve a target but because you’re working on the system.

Your improvements are coming from learning more about the system you’re a part of.

And, to end with another Deming quote: “Learning is not compulsory… neither is survival.”

Cheers,

Karthik Suresh

What Should You Ask Your Customer To Put In A Testimonial?

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Monday, 9.02pm

Sheffield, U.K.

It only serves to show what sort of person a man must be who can’t even get testimonials. No, no; if a man brings references, it proves nothing; but if he can’t, it proves a great deal. – Joseph Pulitzer

Have you ever done some work that’s delivered a healthy return to your clients – a result you can both be pleased with?

Have you also thought of asking them for a testimonial – and then parked the thought, a little embarrassed by the idea and not quite sure where to start?

If you search the Internet for suggestions on what to put in a testimonial you get quite a lot of rubbish.

It starts with the advice that you should ask for a testimonial – I suppose that makes sense so far.

But then you get a selection of poorly drafted email templates that say little or a long list of questions that can act as writing prompts.

The problem with both approaches is that they lack focus.

If you ask someone to just write whatever they want they’ll either find it hard to get started or write just enough to make you go away.

If you provide a list of questions then they’ll answer them, but in the process probably end up losing the will to live a little.

The thing with writing something like a testimonial is that you need it to tell a story – but it needs to be a complete one.

So maybe it’s worth thinking of an outline to help structure it.

The outline in the picture above is a combination of a writing approach from the book Can Do Writing and Neil Rackham’s Spin Selling model.

In Can Do Writing the authors suggest that you should start writing every document with a purpose statement.

A purpose statement addresses the following questions:

  1. What type of document is this? – testimonial
  2. What does the document do? – describes
  3. What information does the audience need? – savings/results
  4. Who is the audience? – prospective customers
  5. What will the audience do with the information? – trust it

A purpose statement for a testimonial might read something like this:

The purpose of this testimonial is to describe how the XYZ company saved $X00,000 from our manufacturing operations through their consulting work.

An introductory paragraph using this kind of format puts the results up front – and tells prospective customers who manufacturing firms that there is interesting information coming up.

Now, follow up with the SPIN model.

This starts with describing the situation.

We were faced with rising manufacturing costs in our main product division.

Then follow up by examining the problems caused by this situation.

The increased costs at a time of budget restrictions meant we had to stop bidding on certain projects.

Examine what the implications are of making such a decision.

The reductions in expected profits meant we were considering painful headcount reductions.

And how did what you did help?

XYZ consultants identified $X00,000s of savings in our processes through optimising shifts and reducing machine use.

Now clearly I know very little about manufacturing operations – but if you ask your client to write something that follows that approach you’ll end up with four very usable paragraphs.

And that’s probably all you need for a useful and persuasive testimonial.

Now you could write this for them – but it’s probably better in their own words.

And even better on letter-headed paper.

Cheers,

Karthik Suresh

How To Supercharge Your Customer Development Process

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Sunday, 9.19pm

Sheffield, UK

I’m not a tech guy. I’m looking at the technology with the eyes of my customers, normal people’s eyes. – Jack Ma

What are the questions you should ask yourself when thinking about a new startup?

The reason I ask this is because there is an increasing consensus that the way to help cities and areas is to encourage startups that will create jobs and economic growth.

There’s a lot of money out there waiting for a good idea – but how do you know when you have a good idea?

The same questions can be asked if you want to improve how an existing process works.

So, is there a model that can help – a model that may help question an idea and figure out whether it’s worth doing or better abandoning?

The model above is a start, adapted from systems thinking ideas that have made their way into a number of methods – including the lean startup approach which talks about customer development.

Let’s see how this might work with a thought experiment.

Type in “startup idea” into Google and you find a website with thousands of ideas.

Let’s pick one for a graphical restaurant reservation system and see if the questions help.

The system, in the model, is not the system we are building.

Before we build a system to do something we first need to understand the system we are serving.

So, the system that we should look at first is the restaurant itself.

What is the purpose of a restaurant?

It is, presumably, to fill its tables with customers for the sittings it has available.

Or, in transformation terms, change customers wishing to have a meal together to satisfied customers.

Which then leads you to ask what does customer demand look like?

Is this a top end restaurant that is booked up months in advance?

Or is it the kind of place people tend to wander into?

If you want to develop this app you need to understand the nature of the customer demand.

Which probably means spending some time talking to restaurants, maybe even working there for a while to see how it works.

Now, what sort of data will help you understand this restaurant better?

Is it how long it takes to get a customer a booking from when they call?

That’s probably not useful – once you get through on the phone it’s probably fairly quick.

And you don’t know what you don’t know – like how many calls were dropped because they couldn’t get through.

Maybe the measure is how much time staff spend on the phone instead of serving customers?

Let’s say you could record something like that, then you’d be able to suggest than a website where you could book a table would be a good idea – that would improve the process.

And finally, you could figure out if it’s worth doing.

At a large pizza chain, for example, it is worth doing – which is why they do it now.

You can go online and book a table for a time you want and that’s great.

For a single owner-managed restaurant, not so much.

Now, this idea is back from 2012 – so there are applications that do just this.

What’s weird is that this suggestion is one of the top results…

But, the point is that if you came along with a startup idea for this kind of app you’d do well to think hard about points 2 and 3.

It’s your study of customer demand and the associated process required to serve that demand that will help you understand if there is something you can do.

And this suggests that your customer development activity should perhaps be reframed as action research rather than market research.

In market research you try and find out stuff – using tools like surveys, interviews and so on.

With action research you get into the details – immerse yourself in the actual work in order to understand what’s going on and come up with a theory.

When you see customer development as an opportunity to carry out research at an organisation – research that will help the organisation understand what’s going on in more detail – you may get a chance to get a much deeper insight into what’s going on.

Perhaps the first bit of any investment into a startup should be seen as an investment in research – an investment from which possible improvement ideas are generated and which then make their way into startups that create scale and growth.

In regions and cities and innovation hubs around the world, formalising such an approach may help unlock both productivity improvements and innovation.

But even in your own startup using a systems thinking approach is probably worth doing.

Cheers,

Karthik Suresh

How Can You Find Opportunities To Create Value?

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Saturday, 6.38pm

Sheffield, U.K.

Let me tell you something that we Israelis have against Moses. He took us 40 years through the desert in order to bring us to the one spot in the Middle East that has no oil! –Golda Meir

How do you know if you’re doing the right thing right now in work and life?

For example, is your business working as well as it should? Are your staff happy? Are you pleased with your work and responsibilities? Are you losing weight?

And if not, what are you going to do to change the situation?

It’s tempting to think that what’s needed is to work harder, to get others to work harder or work smarter, create better incentives or set up rules and procedures.

So, how do you get started doing that?

It probably looks something like this.

Lets get in a room, set up a flipchart and do some brainstorming.

Let’s get some divergent thinking under way to see all the things out there.

No idea is too silly – let’s capture all of them.

Then, from the list that comes up, we can prioritise, rank, order and create lists of actions. Let’s get the convergent engine going to focus on the things we need to do and set some goals and action plans.

Good. That’s it then. Go off an execute and we’ll review progress in six months.

That’s your typical intervention process – probably being carried out right now by a team somewhere in the world.

But, as I am discovering, there is a problem with this whole process.

And it has to do with the difference between what is, what you think is, and what should be.

The problem with focusing on what you think is going on

When you spend time thinking about what is going on you build a model of what you believe reality looks like.

For example, you might draw process flows, use sticky notes to map how things move along or where the capability sits.

All these tools are a way to capture reality in a model.

What happens when you capture reality exactly?

Well, you’re obviously not going to, because reality is quite detailed, but if you did, your model would be the same as reality, and you might as well look at reality.

Hopefully this makes sense but if not.

Say reality is A.

Say you build a model of reality, B, that is an exact match of reality.

Then, by definition, B = A. You don’t need B, just look at A.

A model of reality is always much less than reality ( B << A ) – it’s a simplification through necessity.

Spend time looking at the actual situation

That’s why if you want to understand what happens in real life don’t interview people – go and look for yourself.

Look around the a factory, follow a piece of work as it travels from hand to hand and see what happens to it.

Don’t worry too much about documenting every step – the document will be out of date very soon anyway.

The point is to spend some time looking at reality for what it is.

What’s important is what should be going on

If you must create a model you need something that helps you understand what should be going on.

It’s a conceptual model – one that you can then compare to reality.

Say this is C, then what you are doing is comparing C to A and asking questions like are we doing the right things here?

How does this work in practice?

If all this seems quite pedantic let’s look at how it might actually work in your business.

Imagine you want to start a B2B startup and are looking for an opportunity – how can you go about doing that?

What model should you have in mind?

As an example, I’ve drawn a model that builds on recent reading I’ve been doing on systems thinking.

It starts by asking who is your customer’s customer?

If you want to offer a B2B service you need to figure out why someone will buy what you have.

It’s not enough to show that you’re going to save them money.

In most cases, the money you save them will flow right out again to their customers in the form of lower prices.

What you’ve got to ask is how what you do helps your customer to add value to their customer.

That’s why things like websites and brochures are seen as obvious things a business needs – they need them to communicate to their customers and explain how they add value in the first place.

Your product that offers cheaper printing has a less compelling offer than a competitor who offers market research and advice on competitive positioning that informs the copy.

So, what does value work look like?

This is the key question – what can you do which will deliver results that makes your customer happy?

Let’s say you want to help a customer with a direct mail campaign.

You could just charge them a 6 figure sum with no promises.

Or you could show them a route to developing, testing and rolling out a campaign that invests progressively in what works, and where their losses are low but the upside is unlimited.

If you do that you’re doing work that has results – value work.

But do you have what it takes to do that work?

Many people believe that the answer is yes and you can figure out how to get the work done when you get the contract.

That’s all very well, but you’re simply setting yourself up for failure if you don’t have the expertise in place.

Then again, maybe you need to develop the expertise and this is an opportunity to do just that.

As an individual or business owner your job really is to get the expertise needed to the point where value work can be done.

And it’s a simple question really – can you make that happen?

Because if not, failure work shows up

Failure work is work that has to be done because something is going wrong somewhere.

If you don’t know how to design a stationery package and take on the work what you create will look off – and the client won’t be happy.

For example, I look back at business cards I designed myself and cringe at how the alignment is wrong – something a professional would never do.

But that’s a small problem.

What if you make a mess of that million pound property portfolio?

That’s a bigger mess and is going to cost you in time, money and angst to sort out.

Finally – what’s happening in reality?

If you look at the four points that make up the model – understand the customer’s customer, define value work, obtain the expertise required and be alert for failure work – you can compare this to what happens in reality in your business.

But of course, we’re looking at a startup example – something that doesn’t exist in real time…

Which is why you can answer these questions best in a business you already understand – which is why it makes sense to look for value within your sphere of competence – something Warren Buffett would advise.

If you’re experienced at farming and land use then an software app is not the best place for you to have a go.

You could learn – but be open to the prospect of paying for that knowledge by making mistakes along the way.

What all this boils down to is that we should probably be clear on exactly what lens, what perspective we’re taking at any one time.

Are we looking at what should be – what our customer’s experience is when they get the benefits of value work?

Or are we looking at what is – what is actually going on and whether we’re doing value work or simply fixing the results of failures.

Because, at the end of all this work, we want to end up in a better place.

Cheers,

Karthik Suresh

Customer Acquisition Strategy For Service Businesses

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Friday, 9.25pm

Sheffield, U.K.

Touch your customer, and you’re halfway there. – Estee Lauder

I’ve been thinking about customer acquisition recently.

You know, the process by which you grow your customer list?

Now that’s easy, you might say.

You can follow AIDA – attention, interest, desire and action.

Or perhaps use SPIN selling – describe the situation, talk about the problem, work out the implications and resolve the needs.

But are those processes?

Actually, what is a process when it comes to this sort of thing?

One thing that a couple of sales experts have said to me – a decade or so apart – stick in my mind.

One said that the thing with sales is to always get to the next step.

It’s not about the win, the shower of gold, the big deal.

Instead, it’s one step at a time, just moving forward, getting agreement on the next bit.

If you’re in a hurry or looking for a quick result that can be painful – but that’s what you need to do.

The second said that you’ve got to think about connecting the dots.

What do you need to have to help move the customer along from one dot to the next?

Now those are quite similar ideas, the first looking one step ahead and the second thinking of having everything lined up so you can go through the steps.

And maybe that’s a process that customers can go through but how do you get them in the first place?

So let’s think of that specifically in the context of a service business – something where you have to sell yourself and what you do to a customer.

Now, there are people out there but is there a market?

The difference between a crowd and a market is that you have a chance of doing a transaction in a market, between you, the seller, and a buyer.

So, you should probably ask yourself a few questions about your service.

Of the people out there are there some who need your service?

If so, do they know about it.

And once they know about it, do they want it?

But that’s not really the right entry point.

What you should ask is whether anyone in the market knows about your product.

If they don’t know about it, the other two questions are irrelevant.

So, customer acquisition starts with that contact – the touch that gets them to turn and raise their eyebrows – that quizzical expression that asks who are you and what do you want?

And your customer acquisition strategies are the ways in which you get that contact with someone else – whether it’s face to face, networking, referrals, direct marketing or all the other ways of getting your message out there.

But how do you get someone to actually try out your service?

And the answer, in this day and age, seems to be that you remove all the risk that they might have.

That’s the realm of free trials, money-back-guarantees and pay later if satisfied programmes.

I guess really a customer acquisition strategy has to have two things at the very least.

You need to do things that let you have conversations with people you don’t know well so you can get to know them better.

If you want to have the conversation go well make something they need or better still, something they want.

That gets you halfway there.

And then you’ve got to make it really easy for them to try what you’re selling – at absolutely no risk of loss to them.

That’s the other half.

And perhaps, if you can see that you’re doing those two things, you’re on your way – headed in the right direction.

Cheers,

Karthik Suresh

Why I Was Wrong About Something I Thought Was Obviously Right

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A long habit of not thinking a thing wrong gives it a superficial appearance of being right. – Thomas Paine

Many years ago I went to a two-day management session for young engineers.

One of the things we had to do was give a presentation on the challenges of developing a product.

I remember that presentation – our group talked about the iron triangle of cost, quality and time.

As you will remember, if you try and improve any two the third tends to go out of control.

If you want to reduce the cost and improve the quality it inevitably takes longer.

This is not a new idea and, a few decades later, I’m still bringing it up every once in a while.

So it’s a little embarrassing to realise that I’ve been wrong all this time.

Wrong at least when it comes to applying this model to modern organisations.

I mentioned in my last post that I’d picked up a book by John Seddon and I’ve also been watching a few videos.

And what he talks about does make you question these long-held assumptions.

I suppose the iron triangle theory came out of a world focused on manufacturing and production.

At the same time, that’s old stuff really. When manufacturers started to focus on managing variation they found they could improve quality, get things out faster and keep costs down and the iron triangle was relegated to the dustbin of historical theory.

I just hadn’t received the memo.

Anyway, if you work in a service organisation, as most of us do, how should you think about service design.

Let’s take an example.

Let’s say you have a small consultancy that provides environmental consulting services.

When the volume of work coming in gets too much for you to handle you look at recruiting.

You hire an admin person, then another consultant, perhaps some graduates.

Pretty soon you have a team and it seems to make sense to start getting some specialisation going on.

That team can do ponds, for example, while the other one can do rivers and the one in the back room can do marshlands.

Pretty soon you have all these teams doing different things and if a customer comes along who has a pond, river and a marsh you get all three teams working hard on their little bits.

Things get dropped, one team’s priority is another team’s back burner work.

Things take longer, mistakes start being made and people get upset.

So you hire a manager, assure customer that you have SLAs in place, get yourself ISO 9001 certified and sit back knowing that you’ve improved the organisation.

Except, the mistakes keep happening and happening and happening.

The problem is that you try and tell people what to do rather than letting them figure out how to make the customer happy.

All this structure and specialisation and job roles are about control – about you being able to create a system you can control.

But an organisation is not like a car with pedals and a steering wheel – it’s a system that responds to what’s going on outside and inside it.

And that means you need to think about designing your business differently.

What you should start with is the customer and what his or her demand is.

Take a simple example – a customer comes in to your business with a broken pot – that’s customer demand.

What that customer wants is to get the pot fixed – that’s value work.

As a business your role in this is to provide the expertise to fix that pot.

And the entire point of your organisation should be to make that happen cleanly – without making a hash of it.

You might think that it’s expensive to have the expertise there to fix the pot – surely it’s cheaper to do it with someone less expensive or outsource it to someone else?

But what ends up happening is that all those attempts to reduce cost actually end up increasing costs – through breakages and failures and misunderstandings and confusion.

The point is that you can throw away the iron triangle and be able to provide a great service, quickly and cost effectively.

But you’ll need to change the way you think about how you build your organisation – and start to think in terms of systems.

And that’s a topic for a book, not a blog post.

Cheers,

Karthik Suresh

How To Manage Your Way Into Trouble

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Wednesday, 8.53pm

Sheffield, u.K.

I literally have a massive database of cat sounds. – El-P (Jaime Meline)

In my travels through old book stores I came across one titled Systems Thinking in the Public Sector by John Seddon which has the line “Keeping a database is a very inelegant way of designing a lettings service.”

So, of course, I had to buy it and find out more.

The reason for this is that all of us have at some time thought about whether we need a database.

Yes, even you…

Even a to-do list is a database – records arranged in a list for you to mark off.

This may seem like an odd thing to think about – surely it’s something that IT people worry about?

But actually, if you run a business, the choices you make about when to use a database and when not to has a real impact on customers and the viability of your business.

Seddon, in his book, uses the example of government organisations that deal with providing housing to people.

One approach you could take is that whenever a house becomes available you market it, let people apply and give it to the people who most need it.

He calls this approach elegant because it is only started when a house becomes available, people who need it right then are the only ones who respond.

The house manager and tenants don’t waste time because they both need something – a house to be let and a house to live in.

Now, what happens if you ask everyone who is interested in a house to register their interest and enter their details in a database.

Now, you start to build a list of people. Some of these might want a house at some point in the future, some need one right now, some might be trying to make sure they’re in line in case they need one.

All this information comes pouring in, so many forms containing data.

You scoop up this data and stick it in a database – and one thing happens.

Your database gets bigger and bigger.

At some point you spend more time worrying about the data in your database and managing it and sending out emails to everyone on it than you do actually helping the people stood at the door needing help finding a house right now.

Now perhaps you think it’s reasonable to make sure everyone who might have an interest in a house is informed.

But think of estate agents and how they work.

They rarely have to go out and tell all the people registered on their list about properties.

That’s because some people are always searching for houses and others aren’t.

You only want to talk to the ones that want to buy.

The implication is that in this case a database is actually going to cost you business as you stop paying attention to the customer and spend time shovelling data instead.

Now does that happen in any other field?

When you think about it you’ll see it everywhere.

It’s there are the call centres where people follow scripts and take details and don’t get anything done.

It happens at the doctor’s surgeries where the medic spends more time tapping notes into the machine than looking at or talking to the patient.

In many of these cases the right thing to do for the customer is to get rid of the database and the logging and the keyboard and spend your time instead helping them sort out whatever is bothering them.

But this is an age where the cloud holds everything and we are conditioned to believe that data in databases is the only way to manage anything.

But it’s not.

So when is it good to have a database and when is it not?

One approach is to think about whether you’re using data to pull information when you need it or using it to push information to where it isn’t needed.

For example, a good database is probably your contacts information. That’s something you’re going to draw on all the time to connect to people.

What about KPIs and budgets and targets? Should you be collecting that kind of information?

That’s when this question gets hard to answer – because it’s linked to deep assumptions we have about how to get things done.

Like the line “You can’t manage something you can’t measure.”

If you believe that then you have a deep, visceral need to collect and store data to feel like you are making the right decisions.

Others would suggest that the preoccupation with data will lead you to forget the most important person standing there.

The customer.

Cheers,

Karthik Suresh

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