May 1, 2014 · 10:35 am

Free!

I got involved in a business model discussion the other day.

geese

(Photo credit: Grant MacDonald)

Someone who has a paid product is contemplating moving to a free model of some sort. The product is fairly unique and I would say has enough demonstrable value that giving it away would cause consumers to question that value.  The main thinking is that in the digital (and many other spaces) people have come to assume that everything is free.  Hello?

First off, nothing is free.  While you as a consumer might not have to lay out any money for the product or service being offered, you are probably giving back something of value.  Your attention (to ads), or your data (to damn near everyone), each of which has quite a bit of value in the aggregate.  Maybe the basic product comes with no strings attached but the really cool stuff requires a payment (freemium).   But that’s not really what was driving my thinking.

People don’t always choose free.  That said people always choose free if everything else is equal.  We call those things commodities, and not all commodities are fruits or natural resources.  Sports scores are commodities, for example.  Why would you pay for them when there are so many free sources (except nothing is free!).

People DO choose to pay for stuff they can get for free.  Bottled water.  Over the air TV.  The real question is this:

How do I differentiate my product so as to add value in the consumer’s mind for which I can charge?

We sometimes lose sight of the fact that price and value, while related, aren’t the same.  For commodities, free (or no price) can be a distinguishing feature.  Where does one go, however, once someone else jumps to free too?  Creating unique products that are clearly better sets up a lot of pricing and business model options.  Being a “me-too” doesn’t.  Make sense?

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April 30, 2014 · 8:27 am

Awesomely Simple

One of my favorite quotes comes from a jazz musician, Charles Mingus, and it concerns one of the things I work on with clients every day: simplification.

Charles Mingus - Bi Centenial, Lower Manhattan...

(Photo credit: Wikipedia)

“Making the simple complicated is commonplace; making the complicated simple, awesomely simple, that’s creativity.”

That doesn’t mean dumbing things down.  It means finding the big idea in everything we’re doing and relating each and every action to that big idea.  If we’re selling air fresheners and someone thinks our cute logo would make great T-shirts, how do those ideas relate?  If they don’t, maybe we need to move on.

Michelangelo captured this notion when he likened sculpture to simplifying the marble.  He said that there was an angel inside a block and it was his job to set it free. There are statues inside every block, he said.  His task was to remove the excess, to make the complex simple.

Many people in business make what they do unnecessarily complicated.  Maybe it’s to prove their worth to themselves or to others.  Maybe it’s because they’re distracted by every new idea or shiny object.  As Mingus said, it’s commonplace.  Take the complexities that surround you in business and make them simple.  Find the big idea – the paragraph that explains the central tenets of whatever you’re doing  – and use it as your roadmap.  That is the tent pole that keeps everything else up and running.  It’s the thing around which you build your business.

Simple enough?

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April 29, 2014 · 9:10 am

Crossroads

This TunesDay, let’s start with a question. Who wrote “Crossroads?”

Robert Johnson

If your immediate answer was “Eric Clapton” or even “Cream,” you fail. If you know your music, you know it was Robert Johnson, a legendary bluesman who died at the ripe old age of 27 (along with Brian Jones, Alan Wilson, Jimi Hendrix, Janis Joplin and Jim Morrison – quite a club).  This is the original:

It was recorded by Cream (along with one of the greatest rock guitar solos in history) live in March of 1968, some 32 years after Johnson.  It’s been recorded many times since by many people including The Doors, Rush, The Allmans, and Phish.  Most of them followed Cream’s interpretation – their version of history.  Their version became our version and that’s the business point made by the song.

You probably have had the experience in your work life of having someone get the credit for another’s hard work.  Sometimes, as in the case of Crossroads, the person getting the credit (Clapton) took a great idea (Johnson’s) and made it better.  The problem with that is it’s rare that the person getting the credit did much of anything other than to present the idea as their own.  In some cases, this version of the big lie gets that person promoted or hired into a job for which they’re totally unqualified while the originator gets barely a nod.  You can count on them having received the blame, however, had things not worked out very well.

I’m hardly ever surprised any more when I read a piece in the press and realize it’s just a regurgitated press release.  That’s fine – I even do it to a certain extent here on the screed.  I try, however, to state it as a quote and I always link to the original.  I like to think I make the press release better by providing context and interpretation.  I certainly don’t take credit for the original research if that’s what’s in the release.

There is nothing wrong with taking a good idea and making it great – just as Amazon, eBay, or Apple.  Clapton always gave credit to Robert Johnson.  It just disturbs me when I see how often I hear reports of someone getting credit for ideas I know first-hand were developed by others.  It would be nice if the reporters would do a little digging and not regurgitate everything they’re given.  What do you think?

 

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