Tag Archives: Strategic management

July 16, 2018 · 4:13 pm

Building A Disaster

Have you heard about the Build-A-Bear fiasco? Build-A-Bear Workshop declared last Thursday “Pay Your Age Day.” Customers could come in and build a bear at its workshops across the U.S., Canada and the U.K. for the price of their age rather than the $50+ it normally costs. Not a bad deal if you’re an 8-year-old or even a 35-year-old parent. The response was overwhelming, with mile-long lines in some places. According to The Washington Post, some waits were seven hours long.

It’s great that there is a large, enthusiastic audience wanting to build these bears, but that’s about the only ray of sunshine here. Some stores gave customers who were turned away a $15 voucher. As a parent, I can tell you that the voucher does little to placate a disappointed child. They were counting on a new furry friend. Many of the ones turned away were members of their Bonus Club, a frequent buyer program, already and others had to join to get the discount. In other words, their best customers. Yikes!

The CEO went on TV and said: “There was no way for us to have estimated the kind of impact, those kind of crowds.” He added, “We did put a notice out for people that we thought the lines could be long, and we worked with the malls, but it was beyond anything we could’ve ever imagined.”

That’s the point for any of us who run promotions. You need to imagine what an overwhelming response will do to your operation. In this case, maybe they should have had people sign up to take advantage of the promotion in advance (and get their emails as a bonus) to get places in the line, much as one does at a concert to get in “the pit”. Maybe extend the promotion for a few days to let those people into the store at predetermined times. Heck, maybe take space in unrented stores in the mall and add capacity. Be creative, consider lifetime customer value, and spend what you need to in order to prevent a disaster.

No good deed may go unpunished and companies that disappoint their best customers rarely go unpunished as well. You with me?

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June 25, 2018 · 10:13 am

Growing Older But Not Up

Jimmy Buffett wrong a song almost 40 years ago called “Growing Older But Not Up.” He wrote the song after breaking his leg in a charity softball game while running the bases. It’s a song I think about fairly often as I’m aging.

Our bodies grow older and change but we still think we’re eternally 25 and able to do all of the silly things we did then without consequences. We sometimes fail to recognize that we’ve changed and we need to deal with the world differently:

Though my mind is quite flexible
These brittle bones don’t bend.

Amen, brother. He was 34 when he wrote that and he says he’s still behaving badly at 71 though to a far lesser degree. The only constant is change, right? I think so, although I wonder sometimes if many in business recognize that this country is changing as it grows older too. I mean that literally. The country is aging, and it’s probably one of the most important changes affecting everyone in business. My generation, the baby boomers, are living longer, the birth rate is down among younger people, and we’re an older population. Here’s a tidbit:

Census figures show that fewer than 17 percent of U.S. counties reported a decrease in median age from April 2010 to July 2017, with the majority of those counties clustered in the Midwest. Nationally, the median age rose to 38.0 years in 2017, up from 37.2 years in 2000.

Doesn’t sound like much of a change but it represents the reason why we see many more ads for drugs (older folks are generally sicker), bigger cars, retirement accounts, and other things. So the question to you is how are you preparing for, and dealing with, the demographic changes that are happening? We’re becoming a more diverse nation too but that’s a much more complicated answer than focusing on age.

You have a couple of choices. You can reexamine your product mix and see if it appeals to people over 50. I’m not sure that Facebook thought it was a senior product but that’s what it has become as young folks are using it less and less. If it has appeal, maybe you need to be targeting that older segment, or at least testing.

The other choice is to deny the change. You’d be like Jimmy, trying to pursue things that reality makes less possible. Your heart and mind might be the right place but your market has changed and you need to adjust your thinking. We can all complain about the changes to the market but we can’t reverse them. Make sense?

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June 22, 2018 · 9:38 am

Old Bay Bacon

It’s Foodie Friday! A friend of mine made some bacon a while back that might have been the best bacon I’ve ever had. It wasn’t so much that it was a nice thick cut nor that it had been perfectly cooked although both were true. Something had been added to the bacon that enhanced its overall porkiness (bacon fans know what I mean) and threw in some extra flavors for good measure. I was smitten.

I asked what was done and the answer was Old Bay. Yes, that Old Bay, the one you have hiding in the back of your spice rack to add to the shrimp and crabs you never quite get around to boiling. While the chef used the same technique I do for bacon (400-degree oven, bacon on a sheet pan for 20 minutes or so, maybe on a rack if you’re feeling ambitious about clean-up), they had sprinkled the raw bacon with Old Bay. It was transformative.

You might not be familiar with Old Bay if you don’t live here in the eastern U.S. It’s a spice blend long associated with Baltimore. Invented in 1940 by a German immigrant fleeing the Nazis, it became ubiquitous in the Chesapeake area and is one of my favorite spice blends. Celery salt, mustard, pepper, bay leaves, cloves, pimento, ginger, mace, cardamom, cinnamon, and paprika – 18 spices in all – make up this magic dust.

There’s a business point or two to be made here. First, we can’t be afraid to try new uses for old products or people. I would never have thought to put Old Bay on bacon but it’s magic. Maybe you haven’t asked a senior member of your staff to do UX testing on your new digital presence, but why wouldn’t you? If someone who, in theory, is less adept at the digital world can appreciate what you’ve done, odds are that your real target will like it as well. Or take an old product like a tape that was invented to keep ammo cases dry, change the color, and voila! Duct tape. Or maybe a heart medicine that had an unusual side effect in many men and suddenly, Viagra.

Second, to my knowledge, Old Bay’s recipe has never been changed. There’s always a tendency out there to tinker with successful products through line extensions or even wholesale revamps of the product. Resist it. Look at Craig’s List – it’s still pretty much the same as it was when it launched 23 years ago. No bells and whistles, no streaming video, just classifieds and a whole lot of success. Create new things but don’t dilute the brand and don’t ever jeopardize the cash cow. There is Old Bay flavoring in many products, but the core product – the spice blend – has never changed.

Sprinkle a little Old Bay on something – bacon, a Bloody Mary, popcorn, almost anything – and remind yourself that greatness can endure even as we find new ways to incorporate it into our businesses.

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