Tag Archives: Strategic management

June 19, 2015 · 8:15 am

The Hole Truth

This Foodie Friday, let’s delve into the world of food mysteries.  I hadn’t really noticed but apparently the holes in swiss cheese have been shrinking and no one quite knew why.  A cynical commentator (who me?) might speculate that the opposite ought to be true, as margins rise when you’re selling empty space.  Be that as it may, it was really a problem and scientists did some investigating.  The answer is instructive for anyone in business.

You know that cheese is made by the interplay of bacteria and milk.  The bacteria is added and the differences in the milk (sheep, cow, goat, etc.) and the strain of bacteria are what make different cheeses.  Swiss cheese is cow’s milk and three unpronounceable strains of bacteria, none of which had been changed;  yet over the last hundred years, and very much over the last fifteen, the holes have been shrinking.  Why?

Turns out it had to do with improved cleanliness.  Better sanitation resulted in a safer product but also removed microscopic bits of hay from the milk.  Those hay bits were critical in the formation of the holes.  That solves our mystery but also raises the business point.

We’re all familiar with the law of unintended consequences but how many of us take the time with our team to think through the effects that law might bring with every new action?  Product changes, a new marketing plan, or any other change has the potential to bring about changes that aren’t readily foreseen unless we spend the extra time to think about them.  It’s nice to tie executive compensation to our stock price but maybe that has the unintended consequence of focusing on the short-term or good financial results at the expense of better customer service.  Maybe we cut the price to get a deal but then realize we’re losing money.  Maybe we reduce quality to save on costs and watch as a competitor steals share.

Making the milk cleaner was a great idea – who wants customers getting sick and dying?  The unintended consequence was a big change to one of the product’s signature features.  After all, without the holes, Swiss Cheese is just Emmental and Appenzell.  That mystery took 100 years to solve – hopefully the mysteries inherent in your business won’t take that long.

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June 17, 2015 · 10:37 am

Getting Chosen

You probably have been spending a lot more time interacting with your mobile device over the last year.  You’re not alone, and much of that interaction takes place through apps.  I don’t know about you but I have a lot of apps installed (and even more that I’ve used and uninstalled over the years).  I just checked my phone and there are 131 app icons.  Putting aside that there’s probably a dozen or so that are pre-installed crapware from my carrier and the handset manufacturer (I ranted about that previously – you get a reprieve today), that’s still a large number of apps competing for my attention.  There are hundreds of thousands more in the app store too.

My reality, and I’m guessing yours too, is that I only use a couple of dozen of them on any sort of regular basis.  Turns out we’re not alone, at least according to the good folks at Nielsen:

Despite the increase in choices, the number of apps used is staying the same. A recent Nielsen analysis found that on average, U.S. smartphone users accessed 26.7 apps per month in the fourth quarter of 2014—a number that has remained relatively flat over the last two years. And consider this: Over 70% of the total usage is coming from the top 200 apps.

However, while there appears to be a consumer threshold to the total number of apps people are willing and/or able to actively use during the month, the time they spend engaging on those apps has increased. In fact, the monthly time spent per person has increased from 23 hours and two minutes in fourth-quarter 2012 to 37 hours and 28 minutes in fourth-quarter 2014—a 63% rise in two years! So the reward for being one of the chosen apps is heavy engagement by the user.

It appears our app usage mirrors our TV usage.  While we might have access to hundred of TV channels, most of us only watch 21.  As has happened with TV, the engagement deepens with the chosen few.  The challenge for any business is to become one of those two dozen.  The means making the potential user base aware that you are the best solution to their problem, whether it’s how to amuse one’s self or how to get to a place you’ve never been or how to get clothes that are reasonably priced and fit well.  It means avoiding the dreaded “uninstall” – that action that takes place whether you’re an app or not when a customer moves on since you didn’t deliver on the promise made.  Maybe you were boring.  Maybe you were bloated with ads.  Maybe you tried to sneak in a lot of extra charges.  Those things aren’t limited to apps but they’ll lose you the “chosen” status much of the time.

What are you doing to be chosen today?

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June 16, 2015 · 10:27 am

Are We Getting Dumber?

Every day there are more articles written about the vast treasure trove of data marketers, publishers, and others gather from their interactions with customers.  Every mouse click, every social interaction, every store visit is another source of information that a business can use to make the

English: Somerfield, Spilsby One of the last c...

(Photo credit: Wikipedia)

customer experience more enjoyable and, hopefully, more profitable.  Nice ideal, but the reality is far from it, since most of the time the data is not collected, analyzed, and organized by capable people.  In fact, I’m willing to bet that the folks who could benefit most from all of this information know the least about it.

Here is something from eMarketer:

In a March 2015 study by Signal, 51% of marketers worldwide reported that they did not have a single view of customers/prospects across devices and touchpoints. In comparison, just 6% said their current solution provided an adequate single view of their customers. And Econsultancy polling in association with ResponseTap in March 2015 found that only 5% of client-side marketers worldwide had a seamless integration of customer touchpoints across channels that allowed for exploitation of opportunities. Just under a quarter had integrated channels but were channel-focused, not customer-focused.

That was about marketers’ understanding of mobile but there is much evidence that the same sort of low integration applies in other channels as well.  I mean think about your own experiences on-line and off.  I know my supermarket knows everything I buy because I’m diligent about using my card to get gas rewards – cents off gasoline purchases. That is a great value received – along with some good store discounts –  in return for me giving up my data.  That said, when I check in the scanner doesn’t acknowledge me by name nor are the coupons I sometimes receive at checkout very well targeted.  The mailings I get from the store – not the circulars – that’s asking a bit much – the coupon packs and email offers don’t seem very well targeted at all.  They have the data – they should be getting smarter and I should never want to go shop anywhere else – but nether of those things are true.

Every customer interaction counts.  We are getting a lot better about collecting them but we’ve got a long way to go to create a better experiences for our customers.  Media need to understand how to create that same better, efficient experience for their advertisers.  Heaping 15 minutes of ads into a 60 minute window isn’t it and the data can show us that.

So are we getting dumber?

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