12 Ways to Survive This Nuclear Winter (Part 2)

Here's part two of Josh Quittner's advice on how to survive (and thrive) in the current dismal economy. Josh is Consumer Technology Editor-at-Large for TIME Magazine.

Number 7: Obsess about data -- cash flow, web traffic, number of customers, etc. Now is the time to let the numbers guide, but not dictate, your decisions.

Number 8: Reconsider your business model. Are you doing what generates revenue? Or are there tangential functions that don't add money to the company or value to the brand?

Number 9: Study the big picture. Where are the major players in your market? What are they doing? Are they leaving niches under-addressed?

Number 10: Overcommunicate with customers, employees, vendors, investors, and all other stakeholders.

Number 11: Work on stuff that matters -- In other words, is this what I really want to do with my life? If not, now is a great time to find that other something and get after it.

Number 12: Have I got a good back up plan? To quote that great philosopher from SNL of old, Rosanne Rosanadana, "It's always something." When you try to predict the future, you will be wrong. So have a Plan B (and C, and D).

12 Ways to Survive This Nuclear Winter (Part 1)

Josh Quittner is the consumer technology Editor-In-Chief for TIME Magazine. He recently spoke to the Arkansas Venture Forum and shared his thoughts on how entrepreneurs and firms who support them can weather this current economic "nuclear winter." He presented 12 strategies for success. This week I'll present the first 6. Part 2 next week will outline the second six.

1. Have an "immigrant" ethic....be very careful with your money; work tirelessly
2. Get cash flow positive NOW
3. Outsource and distribute those things that are not essential to you
4. Spend smart
5. Get hypercompetitive and get aggressive in winning new business and delivering
6. Focus on improving essential features, not nice-to-haves

More next week.

Life and Business Colliding

I haven't forgotten about the blog....will return after Thanksgiving....thanks for staying with me....

The One Call You Always Take

Twice in the last two days, I've been talking with colleagues who interrupted our call by saying, "Hang, on, I've got to catch this call." In both cases, the call was from a child at college. My daughter is 14 hours away at college so I perfectly understood being put on hold. You always take the call from a kid at college, whether the topic is "I need money" or "The oil light came on last month....should I worry?" or "My professor hates me, I hate my roommate, I hate college, and I've just signed up for the Peace Corps, cut off all my hair, and got a tattoo." Some people are just too important to ignore.

Do your clients feel the same way? Do they interrupt calls to take yours? How do you become the "interrupter" and not the "interruptee?" Here are three ways to make sure they take your call:

1. Offer a gift. Every time you talk with a client, you should give them something no one else can give them. It could be a compliment, a tidbit of free advice, a tip on a new technology that would make their life easier, or just a juicy piece of news about a mutual acquaintance.
2. Keep it short. We're all busy, so keep the interruption to a minimum unless, of course, they want to talk.
3. Listen more than you talk. Once you offer the gift, let the recipient do the talking. If they're busy or don't want to talk, fine. But you may have caught them in the middle of an issue. We all want someone who listens to us on our terms. This might just be the time the client wants a receptive ear.

Give 'em a reason to take your call. They'll appreciate it more than the call that begins, "Daddy, who is our insurance company....?"

IVR Revenge

Seth Godin mentions in his blog a company that has found a way around those interminable phone trees we get when we call a large company. Fonolo is in beta with a service that "spiders" phone trees for, say, your bank, and then allows you to "deep dial" the number you want. You bypass the language choices and the inane "Please listen carefully because we've changed the options" speeches we always get and you get directly to the number you want.

Fonolo is an example of consumer backlash against companies that place operational efficiency ahead of a positive customer experience. It will be interesting to see if the large companies fight this or accept it. The excellent companies will take a lesson and make getting to the right number quickly a normal part of their process.

Help a Reporter Out

Heard of this? Help a Reporter Out http://www.helpareporter.com/ is the brainchild of Peter Shankman, an author and PR guy in NYC who got tired of going to his contact list when reporter friends were looking for sources for a story. He started it on Facebook then quickly out grew it and moved to its own site. When you sign up, you get daily (usually 3x) emails from Shankman with one to two dozen requests for stories. You find a story that you can help with and respond to the reporter. The subjects and publications range from the obscure (and a bit weird) to mainstream media.



There are currently something north of 16,000 people who have signed up to be sources. There's also a LinkedIn group.



Why should marketer's care? Well, first, if you're in the professional services world, what better way to market yourself than by being quoted on a subject that's close to your heart and where you can add value? Second, here's another great example of the melding of social networks and digital technology to meet a need.



Check it out. You may get the chance to have your fifteen minutes of fame riffing on your favorite subject.

Staying Up in Down Times

Here in the South, we're "fixin' to" (or preparing to) enter the Dog Days of Summer...a time when the heat goes up and everything slows down. This summer we face the Dog Days coupled with an economy that by all accounts is and has been in recession. What should we marketers do?

If you listen to management guru Ram Charan, you go on the offensive. In a recent Fortune magazine article, Charan lists his four imperatives for business in a slow economy. Good advice for marketers as well.

1. Keep building -- excellent companies cut where they have to but don't touch new product development, innovation, and brand building.
2. Communicate intensively -- your employees are stressed, your investors are stressed, your customers are stressed. Keep the lines of communication open. More importantly, keep listening to your customers to understand their needs. If you can profitably meet those needs now, you'll be in a great position to grow your relationship with them when things pick up.
3. Evaluate your customers -- right now, cash flow is king. Do some of your customers view you as a bank for interest free loans by continually postponing payment? Maybe it's time to let them go or renegotiate. Either way, now is not the time to prolong unprofitable business.
4. Just say no to across the board cuts -- make cuts with a scalpel, not a chainsaw. Slow times may be a good opportunity to sell or close unprofitable parts of the business, but across the board reductions rarely work.

If we take this advice, we can help our clients weather this Dog Days economy so that they are positioned to build market share when we get to better times.

Don't Tell the Boss About This....

I used to work with a guy who had this great way of getting out of meetings. At exactly 25 minutes after the meeting began, his secretary would come in and whisper something in his ear. He would then leave the meeting room. Ten minutes after that, his secretary would reenter the room, pick up his belongings and leave. This guy never attended a meeting for longer than 30 minutes!


Now there's a free service called Phone My Phone (http://www.phonemyphone.com/) that cuts out the middleman. If you go to Phonemyphone.com, you can have the service contact you at a pre-determined time so, if you're in a boring meeting, you can discretely excuse yourself and leave. It's also great as a Plan B for that excruciatingly terrible blind date. I've also heard it used to find your cell phone when there's not another phone around.


Now, I doubt phonemyphone.com will become the next LinkedIn for the business world.

But it teaches us as marketers that if you tap into pains in the marketplace ("please get me out of this meeting!!") you can create awareness for your company. Then you can then add additional services that are more serious and business focused.


It will be interesting to see how PMP gains subscribers and how their business model evolves.

Has anyone used Phone my Phone?

A New Spin on an Old Idea

Every heard of “flogos?” A flogo is a floating logo, made of soap, water, helium and compressed gas. Snowmasters, Inc., maker of Flogos, is a Lexington, Alabama (http://www.flogos.net/) based special effects firm who counts Disney, the Atlanta Braves, and Auburn University as clients. Flogos are made from a machine that looks much like the Play-Do clay press we had as kids – the cloud is generated in the machine and forced through a stencil of the desired logo, then it’s cut as it passes through the stencil. The cloud then floats up and, if there’s a wind, out over the countryside. Flogos have been known to travel 30 miles and reach a maximum altitude of 20,000 feet.

Flogos are environmentally friendly and, so far, airplane friendly. The FAA has said the floating logos fall under the same rules that govern balloons.

What’s cool about this from a marketer’s point of view is that it takes an old concept –flying an old biplane with a banner over a stadium – and completely updates it. This is a concept that should have some staying power because of its uniqueness. Until, of course, someone has an accident while watching one of these and then hires a personal injury lawyer. But for now, let’s enjoy a new product from a creative company.

Has anyone seen a Flogo?

Happy Birthday DARPA

Q: What do you get when you connect “100 freewheeling genius zealots” with a travel agent?
A: You get the government agency that created the blue print for the Internet, sponsored the inventor of the computer mouse, and helped send man to the moon via the Saturn rocket program.

The Washington Post ran an article in their April 7, 2008 online edition highlighting the fiftieth birthday of the Defense Advanced Research Projects Agency (DARPA). DARPA was formed by President Eisenhower in 1958 as a response to the Soviet’s Sputnik launch and as a way to fast track applied research. It’s a unique agency in a world of government bureaucracy – it has only two layers of management and half of its employees are program managers or office directors who are on 4-6 year assignments.

“DARPA will take a chance on an idea with no data. We’ll put up the money to go get the data and see if the idea holds,” said Anthony J. Tether, agency director.

The agency is currently working on two-way speech translation systems which allow a soldier to communicate with and understand anyone they encounter anywhere in the world. They’re also creating a prosthetic limb prototype that uses the brain to control the limb and help soldiers remain in the military without having to be discharged.

So what can we as product managers learn from DARPA?

1. Even in heavily bureaucratic organizations, innovation can thrive. If it can survive in the Mother of All Bureaucracies, it can flourish in yours. Don’t give up.
2. Innovation is best done with flat organization structures that enable fast, go / no-go decisions. You’ve got to get the bad ideas out of the way as early as possible.
3. Innovation is a mix of art and science and is typically not linear. Sometimes you have to go get data to support an idea, rather than having an idea come as a conclusion from lots of data.
   

Innovation is about big ideas that change the way we do things. DARPA is a great example of big ideas that change the world. Happy 50th DARPA.

Can Brand Value Be Measured?

No where in marketing do you see the collision between art and science than in estimating a brand's value. The metrics are often subjective and rely on sometimes tenuous assumptions.

But brand value is not insignificant. Interbrand conducts an annual survey for Business Week magazine on brand value. For 2005, the top five brands and their valuations were:

1. Coca-Cola $67.53B
2. Microsoft $59.94B
3. IBM $53.38B
4. GE $47.00B
5. Intel $35.59B

But how should a firm estimate its brand value and, more importantly, how does that impact the way they run their business on a daily basis? Two of the gurus in brand valuation have just published a book that provides gives companies a clear road map on how to measure a brand's components so that they can make data-based decisions. Value Creation: The Power of Brand Equity is the new book by William Neal, Past Chairman of the American Marketing Association and founder of SDR Consulting, and Ron Strauss, founder and senior executive of Brandzone, LLC. In the book, they present a common sense approach to brand measurement:

"By taking a representative sample of purchasers in a category through a
specially designed trade-off exercise, we can determine the value of each of
those four major components and their individual sub-components. The model is built at the individual respondent level.

Then, we can manipulate the price in the model so that any one respondent would be ambivalent as to which branded product they would purchase in the category. That, then allows us to calculate the relative price premium that a buyer or potential buyer would be willing to pay for the brand, INDEPENDENT OF the branded product's performance attributes and channel attributes. Given that we have a representative sample, and unit sales volume, we can calculate the total value of the brand in the marketplace.

Furthermore, the output from the model provides very rich diagnostics that identify specific performance and equity issues that are both supporting and detracting from brand performance.

The implications of this Brand Value Model are far reaching - encompassing
firm financial management, new product development, human resources hiring & training, and of course brand management."

Bill's and Ron's approach is applicable to any sized firm. I highly recommend you check out their book and get to know these two practitioners of the art and science of brand valuation. For more information, go to their site: http://www.newvaluecreation.com/

Honor Thy Channel

Unless you’re a serious cyclist, you’ve probably never heard of Orbea bikes (http://www.orbea.com/). Orbea is a Spanish designer and manufacturer of high end racing bicycles. Their bikes retail for $1,500 to $10,000 and are made of lightweight carbon fiber and aluminum. The bikes are sold exclusively through retailers.

I recently had the chance to tour the Orbea USA assembly facility with their Chief Operating Officer. I asked him about Orbea’s distribution strategy of using only retailers. After all, competitive cyclists tend to be pretty “wired” and know what they want, so why not sell directly through the Orbea website? He said they sell through retailers since there is some customization done at the dealer and to protect their premium product positioning.

I also visited an Orbea retailer. I asked the sales guy (who obviously was a cyclist) about Orbea bikes, and he launched into a passionate rant about why they’re the best and how he wouldn’t be caught dead riding anything less.

The Orbea strategy is a great example of why manufacturers must stay true to their distribution channels, especially in recessionary times:

• Brand loyalty is not just for the end user. It extends to your channel. Protecting them builds goodwill that carries you through tough times
• Short term margin gains (e.g., selling through the Internet) comes with a long term cost of diminishing your brand in the eyes of the end user and losing your channel’s loyalty

Orbea is taking the long view of meeting the needs of a very specific segment of the riding population. Their customers, and their channels, are in turn rewarding this strategy with fierce loyalty.

March Madness Myth?

Tuesday begins one of the high holy periods for sports fans....March Madness. For basketball fans all across the US, this is the time of year they've waited for: the NCAA men's basketball tournament. Many of the games leading up to the championship game are played in the afternoon on Thursdays and Fridays. The conventional wisdom is that those fans will be following those games online while working, thus "stealing" from their employers. The outplacement firm of Challenger Gray estimated in 2007 that lost productivity amounted to a staggering $1.2B. Or did it?

Here's how Challenger Gray figures lost productivity during the NCAA basketball tournament.

• 79 million -- Number of Americans who have Internet access at work.
• 22.9 million workers --29% of workers say that they are basketball fans.
• 13.5 minutes -- Average time spent on college basketball websites during tournament.
• 309.3 million minutes -- Time spent on websites during tournament.
• $1.17 billion -- Total lost in productivity (average wage every 13.5 minutes is $3.78).

Sources: Challenger Gray & Christmas using data from MRI CyberStats, ComScore, Hitwise, CBS

All this assumes, of course, that employees had no downtime to begin with, which we know isn't the case. So, watching a game online during work hours is probably replacing shopping online, chatting via IM, or balancing your checkbook. Bottom line: the real number is probably south of $1.2B but greater than zero.

Nevertheless, March Madness is the closest thing America has to the hysteria around the World Cup. I wonder if anyone has done those calculations?

Cool Technology + a Need = Success

One of the blogs I enjoy reading is Marc Andreessen's blog (http://blog.pmarca.com/). He's always out there with technology that makes you think.

Here's a new product he mentioned on his blog that could be one of those "disruptive technologies" consultants like to talk about. (see the video here). It allows you to voice your thoughts without speaking. The applications are astounding for ALCS patients and others for whom vocalization is impossible.

Personally, the very act of having to put my thoughts into words keeps me from saying stupid things...my mantra is "just because it comes into your brain doesn't mean it has to come out of your mouth."

Planning for Retirement (Your Product's, Not Yours)

The last thing anyone wants to think about during the excitement of a new product launch is how to retire it. Try bringing that up in a launch meeting and you'll get shouted down or just ignored.

But product managers are paid to manage the entire life of the product....even its death or retirement. So, here are a couple of things to think about once you recover from the launch party hangover:

• Market the retirement as positively as you would (or did) the launch
• Have a communication plan explaining why the retirement is good for the customer
• Have a solid transition or "crosswalk" plan -- Make sure to have a suitable alternative product ready for them prior to the cut over date and make the cut over as painless for the customer as possible.
• Make it easy for the customer to ask questions -- have a toll free number or a plan to contact key customers before, during, and after the retirement; keep the lines of communication open.
• Make sure all suppliers, value added resellers, and partners are aware of the retirement and you have a plan for each.
• Fully estimate all of the retirement costs before hand -- make sure leadership understands the one time and ongoing costs, if any, of retiring the product, not just the revenue that is foregone.

Do these early and the other retirement (yours) will be easier to plan!

Welcome!!

Welcome to Product Management for Profit. Not a spine-tingling subject, but for marketing practitioners, it's all about delivering profit from marketing activities. My goal is to get marketers talking about how to show marketing's contribution to value creation. So, I'll be posting thoughts, resources, best (and worst) practices, and the like. I'd like to hear from you...what works, what doesn't work....