Tag Archives: Business and Economy

December 11, 2019 · 4:14 pm

We’re Not Stupid

I do quite a bit of headshaking these days. We won’t talk about the political stuff that causes me to do so but there are just as many things outside of politics to trigger the behavior. I’d like to talk about one of them today because it’s instructive for anyone in business.

One term that’s become en vogue is “alternative facts.” You know what I mean – the dissemination of pieces of information that are mostly or completely untrue. Orwell termed them “doublethink“. I term them lies.

What brought this on? I subscribe to a bunch of magazines – golf publications, cooking publications, and several others. This time of year, in particular, I get snail mail with offers to send a gift subscription. Some ask me to renew or extend my existing subscription and offer to send a free gift subscription to someone as a thank you. So far, so good. These offers are usually clear and only mildly annoying.

Then there is one publication that just doesn’t get it. It’s part of a larger family of magazines and I wonder if what I’m about to describe goes on at the other publications as well. An envelope shows up stamped first notice. I’m told my subscription is expiring and I should renew. A few weeks later comes the second notice. Last week, I got some mail marked THIRD NOTICE in large letters outside the envelope. Inside was the same notice I’d already received twice – my subscription was going to expire (aren’t we all?) and I need to renew ASAP for uninterrupted service.

Here’s the problem. I just renewed this subscription last year for several years. Just to be sure, I found the last issue and sure enough, there on the mailing label was the expiration date. It’s January alright. January 2021. I’ve got a year to go. I wanted to confirm this so I logged on to my account on the magazine’s website. My account lets me use the site’s “recipe box” which I do quite a bit but for some inexplicable reason, it’s not linked to my magazine subscription. When I click on the “manage account” link, up pops a new tab asking me to renew. Again, there’s an assumption that you’re dumb and will just renew because a very in-your-face page is telling you that you need to. In order to see your current account, you need to click through on the FAQ link at the foot of the page and scroll until you find a link to “log in to your account”. Of course, when I finally found this and did so, I confirmed that I had a year to go on my subscription.

Putting the awful user experience aside, what’s bugging me is that these publishers think their readers are dumb. They seem to believe that sending out misleading notices with “alternative facts” will lead to renewals. I wish I could say they were unique but they’re not. I’m sure you get the same kinds of “notices” that I get. My home warranty is expiring (I don’t have one), I can have a “free security system” (it’s far from free), and on and on.

Companies that think we’re stupid deserve to be out of business. I’m well aware of Mencken’s statement that “No one in this world, so far as I know … has ever lost money by underestimating the intelligence of the great masses of the plain people”. We need, instead, to think like David Ogilvy: “The customer is not a moron. She’s your wife”. Putting aside that deceptive marketing just might be illegal, doesn’t it bother you to be thought of as an idiot?

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November 22, 2019 · 4:29 pm

The Grocery Store

The topic for this Foodie Friday is the grocery store. Think for a minute about where you do the bulk of your grocery shopping. Is the merchandise that it carries substantially different from one of its competitors? My guess is that it probably isn’t. All the national brands are there and the same person who stocks the snack or bread aisle at your store might have left a competitor twenty minutes earlier. So why do you go?

We had a Wegman’s open here. The lines to get in were HOURS long. I’ve never shopped at a Wegman’s but those who have proclaimed their undying loyalty. There’s been a rumor floating around my neighborhood (since confirmed!) that a Publix will be opening in the not too distant future. People who’ve missed their sandwiches and service are swooning. In the case of these two stores, they separate themselves from everyone else in very clever ways; Wegman’s via setting themselves up to feel like a European marketplace and Publix via their signature subs.

Some of it is just smart branding. While my local Harris Teeter and Lowe’s Foods both make various types of sausages in-house, Lowe’s brands the entire operation as The Sausage Works and gives each type of sausage a clever name. They even sell “My Sauageworks” tee-shirts (and you can imagine the looks I get when I wear mine in public). They pride themselves as being the Best Of The Wurst and are constantly inventing new flavors such as their newest, The #63 Philly, which they describe as a brotherly love blend of chicken sausage, mozzarella, green peppers, onions, mushrooms, and spices. No commodities here but while both stores sell the same basic sausages, Lowe’s goes the extra mile and can market behind it.

I think may business sectors have become quite commoditized. When I was running a sports site, we would often remind ourselves that people can get a game score or most statistics anywhere. The only way we could compete was to provide something unique, better, and in-demand. I think every business needs to think of itself in terms similar to that, even if you really do have unique aspects baked in. It won’t be long before someone has what you have and maybe is offering it on better terms.

Why do you shop where you shop? If “better prices” is the only answer, that store might have trouble the minute a competitor decides to price match.  It’s much harder to match a better experience or unique merchandise, no matter what business you’re in. Don’t you agree?

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November 20, 2019 · 4:26 pm

Am I Hot Or Not?

One question that often comes up as I’m discussing franchise opportunities with people is that of what businesses are “hot.” It’s interesting that “hot” comes up at least as often as “profitable”. I can answer the questions for them (and usually do), but I also add a couple of other thoughts. That’s our topic for today.

For those of you that are curious, what’s currently “hot” in the world of franchises falls into a few broad categories. Within the food sector, breakfast places, juice bars, Mexican food, and healthy bowls are doing well. Restoration services – businesses that clean up after accidents or disasters are hot as well. Some of the other categories that are in demand are childcare, pet services, fitness businesses, and some “alternative” health businesses (cryotherapy, etc.), and beauty/grooming. As an aside, I represent businesses in every one of these categories – let me know if you want to learn more!

I’ll review those categories with interested candidates but then I caution them and I’d like to do the same here. Many of the businesses in those categories are “sexy” but several are not particularly profitable.  When you’re thinking about making a huge life change, which is what many of the folks I speak with are doing, you need to take a step back and look at the big picture. It’s not about what’s hot because what’s hot today may be gone tomorrow. Think about businesses that were all the rage a couple of years ago. Yogurt stores (yes, I have some of those too) seem to be fading away. Most of the “daily deal” sites have consolidated or gone away. Same with many of the subscription box services. The tanning bed business has transitioned into a spray-tan business.

My point to them, and to you, is that focusing on what’s hot isn’t a great criterion as you’re looking at new opportunities. Instead, ask yourself what makes you happy. What can you see yourself doing every day that will have you excited about getting out of bed? The odds are that there is a franchise that will allow you to do that. Some folks are equally concerned (or more concerned) with making money. Many of the businesses that do that aren’t “sexy.” They’re things like home repair or remodeling businesses or they’re businesses that might require a higher level of capital like a senior care business where you might need to “float” a payroll until cash flow grows.

Businesses ebb and flow. Categories run hot and cold, but what makes you happy probably doesn’t. Add profitability to the mix and you’re on the right track, whether it’s hot or not.

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