Apr 11

Magazine Highlights: November – April

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Column: Best Practices Get You Only So Far (Harvard Business Review -  April 2010)

  • Next practices are all about innovation: imagining what the future will look like; identifying the mega-opportunities that will arise; and building capabilities to capitalize on them. Apple’s Steve Jobs and Tata Motors’ Ratan Tata do just that.
  • I help executives unearth opportunities by focusing them on big problems that their companies will benefit from by tackling. They must ask six questions:
    • Is the problem widely recognized?
    • Does it affect other industries?
    • Are radical innovations needed to tackle the problem?
    • Can tackling it change the industry’s economics?
    • Will addressing this issue give us a fresh source of competitive advantage?
    • Would tackling this problem create a big opportunity for us?
  • If you look for ways to develop next practices, opportunities abound. In fact, executives are constrained not by resources but by their imagination.

Vision Statement: Behold the Extreme Consumers…and Learn to Embrace Them (Harvard Business Review – April 2010)

  • people so infatuated with the brand that they spend more than 10% of their lifetime income on it. But they can be your most powerful allies. This study of 2,000 extreme consumers in China, Europe, and Japan reveals that their passion is contagious. They promote the brand via blogs, fan websites, YouTube videos, and word of mouth.
  • Only around 5% of consumers go to extremes, on average, but they have an enormous impact on a firm’s profitability
    • They’re loyal – They tend to stay true to their brand no matter what, and they speak up for it when it’s under attack.
    • They have resources – Most are 30 to 45 years old, and their income is above their national average.
    • They add real value – Consider the iPhone apps built by die-hard Apple fans, or the Japanese Ferrari dealership opened by Osamu Enomoto, a former engineer who quit his job at Toyota to sell the cars he loves most. Enomoto has sold more than 1,000 Ferraris in a country that has a total of around 10,000.

Work on identifying who your 5% of brand loyalists are by sending an email blast to all customers with a request to fill out a survey, share a success story or testimonial, etc…The idea is to identify those customers who have the passion and loyalty to help promote your brand. Once you filter through your responses, segment these customers into their own contact list, and promote referral programs, new products, and other such programs to your brand builders.

Web Pro Security (.net – November 2009)

Retailers don’t have to reinvent the reel to build successful online video programs (Internet Retailer – March 2010)

  • “We identified people who were already doing online tutorial videos and who were popular on YouTube and told them we would pay them to create videos using our products and mentioning our name,” Blum says.
  • “The fundamental mistake retailers make is thinking ‘I’ll create my own video, put it on YouTube and I will be a huge success.’ You have to establish a relationship with the people the YouTube community already trusts,” Blum says. “You’re not going to launch a video on YouTube as a retailer and automatically get 100,000 views.”

Tougher Customers (Internet Retailer – March 2010)

  • And that’s what Macy’s did, making its promotional codes more prominent on Macys.com. The shopping cart page now includes a box with a header that says, “Have a promo code?” and a link to “Find one now.” That link takes a customer to a Macys.com page listing current discount codes.
  • While consumers hopscotched among e-commerce sites, a sure sign they were comparing prices, that did not translate into a bigger role for online comparison shopping sites. Traffic to those sites declined 18% in the fourth quarter of 2009 compared with a year earlier, according to Compete. In part that can be explained by Google beefing up its own shopping site, Google Product Search, which attracted nearly 147 million unique visitors in December 2009, up 44% from a year earlier, Compete says.

Growth curve (Internet Retailer – March 2010)

  • E-retailers use chat more, and more effectively, as they grow more conversant with its potential
  • The profiles indicate which current visitors might be prime candidates for a chat and which ones agents should leave alone. Agents can see which visitors are identified as “hot leads,” and LivePerson technology balances how many hot prospects there are with the availability of agents so the retailer does not offer more chat invitations than it can handle at peak shopping periods.
  • Forrester’s study found that ShopNBC’s chat program increased conversions by guiding shoppers through the sales process to reduce cart abandonment. It also increased average order size, with customers who engaged in chat spending on average 38% more than other customers. Chatting also reduced returns and order cancellations by about 12% and increased return visits, with shoppers who’d completed a chat-assisted purchase more likely to place an order on return visits to the site, Forrester found.
  •  “They are getting their questions answered while they are sitting there and thinking, ‘Should I or shouldn’t I?’” she says. “They get the information at the time they need it so the sale is closed and they become happy customers.”

How Fast is Your Company (Entrepreneur – April 2010)

  • Pingdom Tools at tools.pingdom.com, where you type in the URL of the site or page you want to test and click the Test now button. Pingdom Tools tests the page and displays the total time required for it to appear on screen. Results also include a chart that displays the loading time for each object on the page, useful for identifying bandwidth hogs.
  • Building for Speed
  • You can do a number of things right now to speed up the performance of your website, including:
    • Keep it simple. Accessibility and content are essential. Don’t let the window dressing slow down your site.
    • Combine Cascading Style Sheets (CSS) into a single file. This cuts down on the number of requests the server has to handle.
    • Streamline CSS by eliminating unused styles.
    • If your site is running on a blogging platform, install a caching plug-in.
    • Trim image size and resolution whenever possible.
    • Specify image dimensions.
    • Use CSS sprites to combine background images into a single image.
    • Avoid Flash-based websites if possible. Use Flash objects strategically, if at all.
    • Move your website from shared to dedicated server or choose a more dependable, higher-quality hosting service.
    • Use a content delivery network (CDN) such as Akamai Technologies or Limelight Networks to deploy content across geographically dispersed networks.

How Anil Dash Applies the Lessons of Web 2.0 to Government – (Fast Company – February 2010)

  • He plans to reread Robert Caro’s The Power Broker, about New York urban planner Robert Moses. “It shows how one person can get a lot done if you know how to hack the system. We also see the danger of not knowing how government works — or not caring. Some of our brightest tech minds behave as if government doesn’t exist. It’s myopia and arrogance. But it’s not only important — it’s a huge opportunity.”

How One Ad Agency Boosted Productivity After Cutting Costs - (Fast Company – February 2010)

  • Partners & Napier, a midsize shop in Rochester, New York, has not only streamlined its processes at the request of a client (Kodak) but also went all in, applying for and earning certification in ISO 9000, a quality-management system akin to Six Sigma that’s normally used by manufacturing companies. What’s more, its creative output seems to have blossomed as a result, as the agency is increasingly turning out higher-quality work, it says, in significantly less time. A creative embracing quality management may be unusual, but it also may be the model for how to handle clients’ increasingly stringent ROI demands.
  • The certification process took six months and required each step of an assignment, from developing a brief to reviewing final work with the client, to be documented. It cost roughly $20,000 out of Partners’ pocket, but it revealed some surprising inefficiencies, including a lot of time wasted in back-and-forths for approvals of briefs, concepts, ideas, and directors. Partners was able to trim the time on a job from eight weeks to three, save the client approximately 40%, and boost productivity by 3.5%.

Six Much-Needed Reforms for the Mutual-Fund Industry – (Fast Company – February 2010)

  • More than half of all portfolio managers tracked by Morningstar didn’t invest in their own funds during the past five years. “How are customers supposed to trust someone who appears to not even trust himself?” asks Dan Carroll, founder of KaChing, a site where professional investors share everything about their portfolios — including how much of their own money they’ve put in them — in hopes that others will pay to mimic their trades. The ideas underpinning the Palo Alto-based company should be copied by the mutual-fund industry. Here are six to start.
    • Reform the Ratings – accounting for research quality, ability to stick to strategy, and at least a year’s worth of returns.
    • Let Information Fly – anyone can view investors’ profiles, and receive email alerts when they trade
    • Cut Frivolous Fees – users pay a 1.25% annual fee to “mirror” genius trades
    • Embrace Transparency – By flipping through a user’s investment history, performance analytics, and stock portfolio, anyone can evaluate trading habits in real time.
    • Talk to Clients – Facebook Wall-style message board allows clients to communicate directly and publicly with their money managers
    • Share Insights – “you know they’re not farming out research, or picking stocks from CNBC.” If clients are wary of the logic, they may cash out at no additional cost.

Pipe up, People! Rounding Up Staff Ideas – (Inc – February 2010)

  • several companies, including Imaginatik, Spigit, and Brightidea, have launched applications designed for collecting, discussing, and ranking employee ideas. These programs look and function like a cross between Facebook and Digg. With Brightidea’s software, for example, each employee has a profile that displays his or her ideas, the number of times he or she has commented on the ideas of others, and whether co-workers felt the ideas and comments were good ones. The program uses this information to tabulate scores for each employee and then ranks the top idea generators

How to Get People to Change - (Inc – February 2010)

What mistakes do leaders make when they are trying to change their organizations?

  • One of the main mistakes is when leaders come up with a new vision but never translate that broad analytical vision into something people on the frontlines can actually execute. I was talking to an entrepreneur who wanted his employees to have a “mindset of customer service.” But if you’re an employee, when you hear that, all you hear is buzzword, buzzword, buzzword, jargon, jargon, jargon.
  • If you give customers in a grocery store an assortment of 24 jams to sample, they’re actually less likely to buy any of the jams than if there are only six jams. Very often we paralyze our analytical side by offering it too much to analyze. The same thing happens if you give your employees too many things to think about — like having a “mindset of customer service.” As an employee, there are 45 things I could do that might improve customer service, and I don’t have time to do all of those things, so I end up doing none of them
  • Social influence is strong. If a third of your employees aren’t filling out their expense reports on time, what they may not know is that two-thirds of your employees are. Sometimes just understanding that a crowd of people is moving in a direction makes people uncomfortable enough to change. One of my favorite studies in the book is about a group of researchers who went into hotels that have those “Please reuse your towels” signs. They changed one of the signs to say, “Most people in this hotel reuse their towels at least once during their stay.” Immediately, towel reuse rates went up 25 percent, and laundry bills went down.

Taking on Big Accounts – (Inc - March 2010)

  • But relying on a client for a large chunk of your revenue can put you in a vulnerable position, especially if you have hired more staff or neglected your other clients to cater to its whims. “No matter how seductive it is to have a client like Amazon or Wal-Mart, those deals go away
  • Ideally, no one account — and no one industry — would represent more than 25 percent of revenue
  • “You almost want to look at it like a portfolio of stocks. You don’t want to have everything in just one industry
  • “I would like to have a nice balance of clients,” says Chapman from Empower Public Relations. “But two things happen when you’re a growing business. You get lucky sometimes — and sometimes you have to shrink very quickly.”
  • At Terralever, Miraglia hires freelancers to handle 20 percent of the firm’s overall workload. That way, he figures his company can sustain the loss of the Red Bull account without having to “cut into the muscle of who we are.”
  • “The No. 1 thing is to be aware of the competition and what they’re doing, and what new types of technologies are out there,” says Enriquez. “Red Bull appreciates us coming to them and pitching them and usually agrees to let us do a portion of that work.”
  • Plus, once you have that competitive insight, you can use it to attract new clients — especially if your contract isn’t exclusive. “It’s a lot like high school dating,” says Bagley. “Nothing makes you more desirable than the fact that someone else wants you.”

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