Category Archives: Helpful Hints

Shared Interests

You can call shared interests believing your own BS or you can call them eating your own dog food. I like to think of it as having skin in the game, a phrase coined by Warren Buffet referring to a situation in which high-ranking insiders use their own money to buy stock in the company they are running. I use it in a much broader context and it’s something you should be looking for at every turn.

Photo by rawpixel.com

I can’t tell you how many companies paraded into my office when I was in corporate life promising to solve issues we might be having with revenue generation, audience measurement, or dozens of other common problems. Many of the offerings were actually quite interesting although not yet deployed in the real world to any extent. If I was interested but skeptical, I’d usually make an offer somewhat akin to this:

I like your product but it’s awfully difficult for me to stroke out a check on something that is promising but unproven. So let’s do this. You provide the product and service as you say and I will pay you a much lower fee (or nothing!). However, if you deliver the results you say you will deliver, we’ll set up a success fee that will pay you more than you’re currently asking. In fact, if your numbers are right, you’ll earn double what you are charging.

In other words, I wanted them to have skin in the game. I wanted our interests to be perfectly aligned and I wanted there to be consequences for us both if we didn’t achieve what we set out to do. The reality is that you should always ask yourself who has what skin where because most businesses do their damnedest to avoid any sort of risk by putting in some skin. Sure, they pay lip-service to the notion of entrepreneurship but there are few who have put their money where their mouth is and invested into the tech ecosystem or directly into startups. Pay attention – much of the time the investment comes only after the product has proven itself or is a direct ripoff of something that’s already successful. I call this the second penguin strategy (you don’t want to be the first penguin that jumps in the water since there may be predators lurking).

If you’ve ever played cards, inevitably there is a kibitzer around. You know – the person who looks on and often offers unwanted advice or comment. They have no skin in the game. There are kibitzers in business too – you can find them writing for many trade publications – and you might even have some in your company as partners or clients or even employees. Not many companies took me up on my offer to make them more money. The few that did were fantastic partners and I still speak with some of the executives from those firms almost 20 years later. Having skin in the game made all the difference. What do you think?

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Filed under Consulting, Helpful Hints

Ghost Kitchens In The Sky

Our subject this Foodie Friday is kitchens, specifically kitchens that service your takeout order. Think about it for a second. You place an order for a meal to go at your favorite dining establishment. In some cases, you go there to pick it up. In many other cases, even years ago, you’d order a pizza or some Chinese food and it would arrive at your front door looking just as it did when you picked it up yourself. You probably didn’t think about if it was actually cooked in the restaurant’s kitchen since it looked and tasted the same as when you ordered at the place. In fact, it almost certainly was cooked by the same hands that were serving the dine-in customers at the same time.

Fast forward to today. With the advent of food delivery services, many more establishments are offering food for delivery. Most sit-down places have experienced a big jump in takeout, so much so that it’s become a significant percentage of their business. I think it also has to do with our general impatience these days. Who can sit still long enough to enjoy a meal cooked to order? So, many places are asking themselves why not set up a kitchen specifically to handle the delivery business rather than expand the restaurant kitchen to handle the additional orders. Ghost kitchens have arrived.

As one article described them, ghost kitchens are delivery-centric cooking spaces without the added hassle of in-person dining that a traditional restaurant brings. Think of them as cooking-focused WeWork spaces. Lower rent, no front of house, no cashiers and no customers tapping their feet waiting for their food are all part of the appeal. As long as the food tastes the same, why would the customer care?

I could write another 1,000 words about ghost kitchens and the pros and cons but the point I want to make today is that they exist because restaurants are rethinking their businesses. If they can grow at better margins and lower costs by doing that rethinking, can’t you? Some pretty big players – Google Ventures among them – are getting involved, and you know it’s just a matter of time before Amazon through Whole Foods starts delivering all those great dishes you can buy at your local store for a take-home or to work meal.

Is it inconceivable to you to share accounting, legal, and other back-office functions with another business that’s non-competitive? A ghost kitchen for your business? How about having your sales staff pick up some lines that complement yours and offer both to customers that might be interested?

If you’re not thinking out of the box, the box might just become a coffin. Instead of a ghost kitchen, it might be a ghost business!

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Filed under food, Helpful Hints, Thinking Aloud

Consistently Human

It’s Foodie Friday and as we head into Memorial Day weekend here in the US, let’s pause a moment to remember all those who made the ultimate sacrifice so that we can enjoy our meals this weekend.

One of the things I’ve written about with respect to restaurants is the value of consistency. One of the best compliments I can pay to a restaurant is in saying I’ve never had a bad meal there. It’s a reflection on consistency – of the raw materials, of the service and, of course, on how the chef has his team operating in producing the same dish to the same standard. In a weird way, many fast-food places are better at doing that than many restaurants even though the cooking staff tends to be younger and less-trained in culinary arts. Even weirder is the notion that some places have gone to robots to do some of the cooking.

One of my favorite hangouts is a restaurant here in town. The food is consistent even if there is sometimes an overcooked burger or a dish that wasn’t plated with enough care. I like that I can see that people were involved. This is what I wrote three years ago about that:

Business needs to be about people.  When I eat, I want to taste the cook’s soul. I like the imperfections and that my pizza is different from how it will be the next time I order it. I enjoy personal service and the quirks of every individual with whom I deal no matter what the business. We need to be responsive to each customer in a human way. It’s why customer service agents reading from a script are just as bad as automated menu trees in my book. Who doesn’t prefer speaking with an unscripted human?

Many of us in business watch the numbers like a hawk for any changes. We might not pay as close attention to the people who make those numbers happen. If you want to make improvements in your numbers you need to understand human behavior – that of your staff and that of your customers. The numbers are a reflection of that. They don’t just happen.

It isn’t machines or numbers we remember this Memorial Day. It’s people. Let’s stay human out there!

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Filed under food, Helpful Hints

You’re Missing The Target

Many of my friends are over 65. Most of them don’t act like it. Sometimes they – and I  – contemplate being younger but I’m always of the mindset that the only way I’d take back 30 or 40 years would be if I could keep the bank accounts and credit cards I have now. While it’s true it used to be a lot easier to get out of bed in the morning, it’s also a lot easier now once I’m out of it to pretty much engage in consumer behavior with a lot less care than I did all those years ago.

It’s baffling to me, then, why most marketing budgets ignore those of us over 55. In fact, according to U.S. News & World Report, we baby boomers control 70% of the country’s disposable income and spend $3.2 trillion a year. We provide over 50% of consumption and yet we are targeted by 10% of the dollars. My kids are millennials and while they’re both gainfully employed they don’t spend nearly what I do. Most millennials don’t spend like boomers yet they’re the target audience for a lot of marketers.

I don’t get it.  Not only is my generation spending more, but I think we’re also more available to be marketed to. We’re heavy digital users (got to keep up with those reunions!) and use Facebook and Instagram quite a bit. We also are still watching “traditional” tv and news. We read our email too. It’s like we’re begging to be sold.

Millennials tend to rent. That means traveling light – who wants to move a ton of stuff when the lease is up? And unfortunately, they’re also the first generation that entered adulthood in worse financial shape than their parents. They spend every dollar carefully.

Marketing has always been “square peg, square hole” to me. Unless your product can’t be used by older folks (pregnancy tests is about the only thing I can think of), the reality is that you should be targeting older folks. Yes, we’ve built up many years of brand preferences but hey, I just switched to a new toothpaste so you never know!

So why aren’t you marketing to boomers? Seems like an opportunity, no?

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Filed under Consulting, Helpful Hints, Thinking Aloud

1,2,3

I’m back! I didn’t post anything last week because I went on my annual golf outing with my Board Of Advisors. All is well except my golf game.

I don’t know if you saw anything about a survey that was released last week. I did and I made a note to make it my first post upon my return because it makes a number of points that I think any of us could find useful in business. The survey was run by Civic Science which has been conducting online polling since 2008. It was a very simple question and the responses were astonishing, at least to me.

Should schools in America teach Arabic Numerals as part of their curriculum?

That’s the question. They surveyed over 3,600 people and over 2,000 of the respondents said “no.” That came out to 56% of respondents saying we shouldn’t teach the numerals we all use every day. Yep – those are Arabic numerals. Interesting, right? Kind of scary too because it reveals what happens when you allow yourself to answer a question based on your inherent feelings (or prejudices) without having a full understanding of the question being asked.

It wasn’t just a test of prejudice against the word “Arabic.” They also asked about teaching a Catholic priest’s theory on the origin of the universe. While obviously, it’s a much more obscure fact (the Big Bang theory was his idea), it shows once again that people will answer something without enough (or any) information based on inherent biases (53% said “no” to this, which is taught every day).

How often does that happen in your business setting? Someone starts to say something in response to a question in a meeting and suddenly it’s quite obvious that they have no idea about what they’ve been asked. It’s not just people answering the wrong question either. It’s quite possible to have an understanding of the question but no grasp of the facts required to answer it.

So here are three words (3 in Arabic numerals) to keep in mind: I don’t know. They can be hard to say, especially when you have a knee-jerk response to a question. But ask yourself if that response is based on fact or on your existing bias. You might be surprised what you’ll learn along the way as well as prevent your team from making a bad decision. Make sense?

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Filed under Helpful Hints, Huh?

Sharing Isn’t Caring

Suppose you are depressed or maybe you want to quit a bad habit – smoking, for example. Well, of course, there are apps to help you fight depression or to quit smoking. Maybe you want a discount on your car insurance so you agree to install what the industry calls a “telematics device.” As one report explained, these things report when the car was used, distance driven, and time spent driving. They also want to know how fast a driver typically drives and any incidents of hard braking, both of which are indicators that the driver takes risks and doesn’t pay attention. Finally, and perhaps most controversially, the devices can track a car’s location.

Since you’re a fairly literate person, digitally speaking, you know the apps collect some data and obviously so does a tracking device. What you don’t know is what happens to the data that the apps collect. If you go through the app’s privacy policies (you know – the thing you clicked through when you signed up), you’ll probably find that the developer might share data with third parties. And, in fact, a study just released shows that of 36 top-ranked apps for depression and smoking cessation available in public app stores, 29 transmitted data to services provided by Facebook or Google, but only 12 accurately disclosed this in a privacy policy.

Does this concern you? It should. It is not difficult at all for someone who has “non-PII” – anonymized personal information – to trace it back to a real person with a name, address, and other information. How many auto insurance companies also offer life insurance? How many share data – even anonymized data – with health insurers. And wouldn’t those health insurers love to know if you think you’re depressed, as would a life insurance company? Am I paranoid? Yes indeed, and you should be too.

As it turns out, while many of us are more wary about what companies are doing with our data, we’re still not DOING much about it. As eMarketer reports, Internet users are clearing cookies and sharing less on social media. Ad blockers continue to gain popularity. But nearly one-third of US internet users are still willing to sacrifice privacy for convenience.

Clearing cookies, using a VPN, making sure that apps don’t get permissions that they don’t need (why does a flashlight app need your contacts?), and other things can help but at the core of this issue is many companies’ philosophy to beg forgiveness than to ask permission. They have a laser-focus on making money and are woefully blind to their users’ concerns. That’s what really concerns me. You?

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Filed under Helpful Hints, Huh?, Reality checks

Let Me Call You Back

One thing I deal with constantly these days is getting people on the telephone. I will often make 20 calls in an hour or two and only get a few people – all of whom have requested that someone call them – to answer the phone. Sometimes when I reach them they’re at work or driving and they ask if they can call me back. They hardly ever do, even when we set up a specific time. They don’t call me so I’ll call them at the appointed hour. They rarely answer.

It sounds awful, right? They claim to want information about new opportunities yet they won’t answer when opportunity comes knocking. My question to you concerns your business doing the same thing. No, not having customers hang up on you, but the opposite. Are you hanging up on them?

When was the last time you looked at your inbound customer service metrics? Do you even have such things? Research shows that consumers value efficient service and knowledgeable staff when they call a business. They find being kept on hold, rude service, and automated phone menus frustrating. You can measure on-hold time and you can test the customer service reps to be sure they’re knowledgeable and personable.  You can check when call volume peaks and schedule more reps during that time.

One thing I’ve come to like quite a bit is the “let me call you back” option when there is going to be an on-hold time of more than a few minutes. You know what I mean – “press 5 to get a call back when there is an available representative or press 6 to schedule a time to be called back.” That’s customer-friendly and shows them that you respect their time and have empathy for their problem. When I hear “your call is important to us,” I always think “if it’s so damn important, why aren’t you answering?” Calling back shows it really is important.

It’s the little things we do in business that say a lot about how we run our firms. What messages are you sending? Are they the kind that will get customers to return?

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Filed under Consulting, Helpful Hints