A Tweet From @RevRunWisdom Inspires Thoughts of ProductCamp

There I was on Friday catching up on email when, out of the blue, I saw this gem of an inspiration from @RevRunWisdom:

"Empty pockets never held anyone back only empty heads and empty hearts can do that -Norman Vincent Peale"

So rife with meaning generally but apropos to what's been on my mind lately.  Like many of you, I spend a good deal of time networking and sharing what I know.  Lately, at the end of every meeting, I am hearing this question, "Why are you helping me?"  My answer is typically some or all of the following:

• Because I can.
• Because I care.
• Because I'm interested in the topic.
• Because I like helping.
• Because I like helping you.
• Because I like paying it forward.
• Because I'm learning something in the process.
• Because it's the right thing to do.
• Because it helps the community.

It occurs to me that my answer is not unlike the vibe at ProductCamps that are held all over the world.  It's not unlike the vibe at ProductCamp Chicago.  If you've not been to a ProductCamp, then I strongly suggest you give it a try.  If you attend, you drive your destiny.  No sponsor is telling you what to buy and no person sets an agenda for you.  If you present, it's your chance to show your might to others and get some great live feedback from your peers.

Unconferences like ProductCamp embody the essence of that Norman Vincent Peale quote.  None of the participants pay to attend and the only thing that prevents someone from getting the most possible out of it is his or her own mind and heart regardless if you are a presenter or attendee.  The success truly depends on how much you're willing to get out of your own way.

See, it's not only the mind that drives the success of an unconference.  Actually, I'd say that the mind is a very small part of what makes unconferences worth the time.  What makes them successful goes beyond the thought leadership.  It's actually the sense of community, fraternity, generosity, humility, friendliness, etc., that helps it elevate itself beyond a glorified show and tell.

Unconferences are relationship and community incubators.  They help us step outside our small circles and become acquainted with the broader community.  They help us learn and grow by making us consider things in wholly new dimensions: inside out, upside down, reverse color, etc.  They encourage our contribution to the greater good either through the sharing of our ideas or the acceptance of others' feedback.  They encourage us to be better product managers, marketers, developers, leaders, architects, etc.

Some cynical ones may say that I'm waxing too romantic about ProductCamp.  My answer is that, to borrow from Norman Vincent Peale, it's an empty heart that thinks so.  And here's a great video from last year's ProductCamp Chicago to back me up.

ProductCamp Chicago - June 19, 2010 

Parissa Behnia

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Why Being Holistic Means Being Divided

No fear... this isn't a riddle like the one in front of the Sphinx.  It's just something that has occurred to me of late based on some articles i've been reading lately and some of the discussions I've been privy to "IRL" as they say.

In my last post, I told you I didn't understand why it would be that I could access my home voicemail via my iPhone but not through my laptop because my chosen browser is Safari.  It was really a call for more complete thinking and something that we could all be doing not only within our own departments (Finance, Marketing, Operations, etc.) but enterprise wide.

We've got to start thinking vertically, horizontally and diagonally -- as well as a bunch of non linear directions -- if we are to succeed long term.  Old habits die hard, I know, but if Amir's 81 year old aunt and 95 year old uncle are on Facebook and send emails, surely we can learn new ways of thinking and doing as well.

So what does thinking in a whole bunch of directions have to do with being holistic and divided all at the same time?  We've seen articles lately about demographic digital divides (here and here) as well as shopper divides (here and here).  I recommend reading all four to get a true glimpse of what's going on in the greater landscape but the net net is the following:

• Minorities, in these cases, Latinos are more prevalent on Twitter than other groups.  More specifically, data show that 18 percent of Latino respondents who spend time online have a Twitter account, versus 13 percent of non-Hispanic blacks and 5 percent of non-Hispanic whites.
• Though advertising shows otherwise, the average grocery shopper is not the young sprightly stay at home mom.  Very often, it's a career mother who has had children later in life or the dad who is making the trip to the grocery store.

At the same time, I've been hearing experts declare the death of direct mail and/or other older forms of marketing, etc.  I guess I don't technically disagree that certain forms of communication are less popular than others.  I'm also being told who is online and how these people behave online.  Hey, data are data.  But, as I mentioned in this post, we're making a lot of assumptions these days which I attribute to a bit of laziness and a form of "what's good for the goose" syndrome.

We're assuming that because of the proliferation (and use) of online channels that we all process information the same way on these online channels.  Or that we communicate the same way on these online channels.  Or that other channels that are not online are not valuable forms of communication.

We're also content to, despite what are obvious differences in what constitutes a household these days, assume that shoppers are just as they were many years ago.  Hey, some people don't want to get married at all.  Some households have two moms or two dads.  And, because we think shoppers are as the same as before, we assume they process information the same way as before or value the same types of messaging as before.

Honestly, the way we're conducting business with all of these assumptions is not really different from this quote from Henry Ford:

"People can have the Model T in any color - so long as it's black"

So, in my call for holistic multilinear thinking is a call for us to think that there may be diversity in who our customers are, how they choose to receive and how they choose to process information.  We may own our brands but we can't dictate to our customers or prospects in the way Henry Ford did.

We have to accept and respect differences.  And by accepting and respecting differences, we have to accept and respect that though direct mail or other older forms of communication may be passe for us, they may be exactly what the doctor ordered for some of our customers.  And while in our mind's eye, the shopper is a young mom, they may very well be a stay at home dad.

How are you thinking holistically?  Are you considering your customers or your markets holistically?

Parissa Behnia
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Disunified Messaging and Holistic Strategies

So, in December, my home phone carrier announced that it was bestowing upon me something called Unified Messaging.  I got lots of bulletin broadcast messages in advance of the conversion brimming with excitement and teasing me with all of the great things I will experience once I enter the Unified Messaging promised land.  I could access messages from home!  From the web!  From an iPhone or an Android!  It kind of sounded like a bit of Dr. Seuss.

So, much like this shopping trip, I naively (and gamely) waited for the conversion.  I was out of town for a lot of the messages that hinted at the special welcome packet I'd get in the mail.  I was curious.  I thought things would CHANGE.

So, after I arrived back into Chicago, I started to set up Unified Messaging on the home line.  New password, ok.  New outgoing message, also ok.  Download app onto new iPhone, ok too.  Amir accessing Unified Messaging on Blackberry... oh, not ok.  Me accessing Unified Messaging on the web via Safari...  oh dear, not ok.  Neither Blackberry nor Safari are supported.

The Blackberry thing "is what it is" so that's kind of a fact of life (though rather a bummer).  We've become inured to that disappointment but we don't necessarily accept it.  But what I think is funny is that I have an iPhone app for Unified Messaging but I can't access it via Safari.  Until recently, my home carrier was also the only iPhone wireless carrier so it's not like this three letter carrier doesn't like Apple.

I find this confusing.  And I was going to keep this to myself...  until I saw this lovely post by Brian Solis the other day about holistic business strategy.  As usual, it was well written and thought provoking and he's not shy about his point.  This is a good representative nugget:

"To put it simply, it is time to for organizations large and small to adopt a holistic business strategy that empowers more employees to think about the whole of the business; to more fully understand the ins and outs of the product/service offering; and ultimately focus on serving their markets instead of serving the stock market."

My personal example is not a big deal but I do think it speaks to some of the inconsistencies that we see with larger organizations today.  I've been there and I've seen those decisions as they are being made.  We jerryrig current products or those in development to be profitable or not too expensive upfront to serve the shareholder instead of  "the market" itself.  The result?  Watered down products that are "fine" or "acceptable" but don't really do the job originally intended.  I've got another personal example in mind that I just may share with you in future, actually.

Brian Solis is right.  All of this is due to misplaced loyalty.  Yes, I understand that we serve at the pleasure of the shareholder and the board.  And, we're to do as we're directed by our CEOs, CMOs, COOs, etc.  That being said, without people willing to buy our products or services, it's kind of irrelevant how angry our shareholders or boards might be if we don't serve them first, let alone how much we annoy our CEOs, CMOs, COOs, etc.  In essence, it's misplaced loyalty because we're not rewarded for serving the market which is another way of saying ownership of customer satisfaction.

So, three letter home phone carrier, why didn't your employees want to own my customer satisfaction and develop a version of Unified Messaging for Safari?  Are your product managers not rewarded for serving the market holistically?

Parissa Behnia
Idea Chef

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P.S. Product manager/developer friends, I do understand that there are differences in developing iPhone apps versus developing for Safari.  But, I can't believe that developing for Safari would be insanely cost prohibitive.

Harmony at the Symphony

On Saturday, we were invited to the orchestra. It's not something that we usually do and we jumped at the chance.  The program was, in short, amazing.   This was it:

"The CSO welcomes French violinist Renaud Capuçon for a performance of Korngold's cinematic Violin Concerto. The concerto was launched into the standard repertoire after the legendary Jascha Heifetz premiered it in 1947. Spanish conductor Jaunjo Mena will make his Chicago Symphony Orchestra debut, leading the CSO in Tchaikovsky's final, intensely passionate Pathétique Symphony."

From the first note of the first piece, to the hypnotic soloist and ending with the aptly described passionate Tchaikovky's Pathetique Symphony, we were transfixed and transported.  And you could tell everyone else was too.

We've all been to bad concerts.  We've all cringed when there was feedback...  if the singer was out of tune...  if the songs just sounded the same...  if it seemed like all of the musicians were just "phoning it in" so to speak...  if it seemed like the rest of the audience was disengaged.  And on and on...

The reasons why this concert was so great was due to the trust and harmony within the members of the orchestra, the trust and harmony the members of the orchestra had with the conductor, the trust and harmony the orchestra had with the soloist and the trust and harmony between the soloist and the conductor.  And it was the intersection of all of these harmonies that created the trust and harmony with the audience.  It felt seamless and actually, it kind of felt like magic.

Nothing in life is easy, as we all know, and after the magic wore off a bit post concert, I started to consider how much time, effort, sweat, frustration and elation went into the preparation of each piece to get it to its level of perfection.  This is let alone all of the time, effort, sweat, frustration and elation that went into becoming an excellent violinist, cellist, flautist, horn player, etc.  

And yet, no amount of musical genius can make up for a lack of trust and harmony.  If it isn't there, performances are flat and the audience is left wanting for more.  So, to get to harmony, though the violinists have an obvious functional role, their greater role is to the form.  And that's because the audience hears the form and not the individual functions sequentially.

So, yeah, this is a business blog so it's time for me to get to the point.  No amount of natural business skill can overcome a lack of strategy, business' version of trust and harmony, within an enterprise.  It matters not a jot if we're creative, smart, analytical, an operations genius, or read the latest business and/or social media manifesto if we don't take the time and effort to create an internal whole that's larger than the some of our parts.  

That is, if we don't take the time and effort to draft (and follow) a lock tight strategy that creates business trust and harmony within on the path to develop (and hopefully grow) trust and harmony with our customers.

There was this article in Advertising Age a little while ago and it was about the traits of highly effective CMOs (read the article - it was good).  I can appreciate why it was addressed to the CMO - it was Advertising Age, after all - but I thought then, as I do now, that these traits apply no matter the function and that perhaps if we stopped paying too much attention to function and instead looked to form to create symbioses and harmony, then we'd all be the better for it.

Some may say that internal business harmony, or form, is too esoteric or abstract.  When we don't get form right internally, it shows up in many different and expensive ways externally.  Case in point: Alaska Airlines diaper incident, United breaks guitars incident, Toyota's numerous recalls, numerous Groupon redemption horror stories (here), my musings on Starbucks (here) among many others.

So, how's your business harmony?  Or, does your business have a tin ear?

Parissa Behnia

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Walgreen's Shopping List: Band-aids and Beer

In the middle of last year, there was an announcement from Walgreen's that they would start selling alcohol in some of their stores.  I was a bit puzzled about the move until the nice people at WSJ showed me the way.  Here are some nice data points from that article:

• When they did sell alcohol, it was one of the nation's largest liquor retailers with liquor and other beverages comprising about 10% of total sales.
• CVS and Rite Aid, Walgreen's competitors sell alcohol in most of their outlets.
• Deutsche Bank predicted a 2% same store sales increase when beer and wine are included in the product mix.  Both DB and Credit Suisse think it's a great idea to sell booze at Walgreen's.
• Walgreen's also predicts a low single digit sales represented by alcohol.  If you take their $63.3B 2009 FY sales into account, 2% would be...  a lot.  Kidding.  It's about $1.3B assuming sales are completely flat.  They didn't provide guidance as to how cross shopping would be impacted to generate incremental sales.
• Some categories are laggards for Walgreen's: cosmetics, cereal and OTC drugs.

Their ledgers say that it may be smart to offer those products to help bolster where they are hurting.  I've got to think that, given the proliferation of alcohol buying options at major supercenters and warehouses (e.g., WalMart, Costco, Sam's), they've baked their assumptions with the stiff (drink) competition.  

 I think their ledgers have gotten everyone very excited about the opportunity to sell alcohol again and it's gotten the nice private label brand people at Walgreen's giddy.  I subscribe to My Private Brand and yesterday, I received news that Walgreen's would offer private label beer.  Here's a picture (source: http://signalwriter.blogspot.com):

As you can see from the label, it's called "Big Flats 1901 Lager" and produced by the Genesee Brewing Company in New York. The $2.99 price point is comfortably priced below than other lagers.  Okay, great.

The thing that we learned in this new economy, is that 60% of us "traded down" to private brand to save money.  I did and maybe you did too.  The interesting bit, extrapolating the data, is that this trading down to save money phenomenon cut across incomes.  But what did that trading down mean across store categories?  That same article showed that for YE July 2010, store brand until sales had a 22% share across all departments...

With only less than 1% in alcohol which means that though we traded down to store brand beans, we didn't do it for beer.  Hmm.  Let's do some math with this 1%.  I guesstimated that the total alcohol sales, as a percentage of Walgreen's sales, would be $1.3B.  If private, or store brand, is less than 1% (let's say .75%), that is $9.75MM.  But that assumes Walgreen's would have private brand across all of its alcohol offerings so $9.75MM is a rather high estimate. 

We can continue making assumptions to break the $9.75MM into smaller parts to get to what the percentage of sales would be that would come from Big Flats 1901 Lager and figure out the rest of its P&L.  It makes we wish I paid more attention in Finance class at Stern.

The long and the short of it is that many resources (time, dollar and people) went into the idea, the manufacturing agreement with Genesee (which had to include production guarantees), branding, advertising, store education, store promotion, logistics, demand planning, etc.  I'm sure I've missed some obvious ones.  So, I've got some questions:

• What is Big Flats 1901?  What's the relationship of that brand to Walgreen's?
• At $2.99/six pack, and in grocery less than 1% of sales come from alcohol store brand overall (and not a subset as would be in this case), exactly what benefit is Walgreen's getting from all of this effort?  
• Why couldn't they have stayed content with the (estimated) benefit from adding alcohol to the product mix (as encouraged by DB and CS)?
• Why didn't they allocate the time, dollar and people resources instead to bolstering up where they were lagging and where they can really compete with CVS and Rite Aid?  
• Did Walgreen's asked their customers if they wanted private label beer generally?  
• Did Walgreen's ask their customers if they would buy private label beer from a drugstore?

The list isn't exhaustive - I invite you to add more.  I just wonder at all of that effort for what, to me as a shopper and marketer, seems to be an uncertain outcome.  If it was truly important for them to help sales and be more competitive, why invest in something iffy?  I'm a bit confused by this move.

Parissa Behnia

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678Partners.com

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Putting the logo cart before the service horse...

Imagine that you're at Starbucks.  Not your usual hangout but one in another city.  You buy some coffee, do some work thanks to free wifi and mind your own business.  Then nature calls but you see the WC is in need of TP.  You share with the idle staff that the WC could use some TP TLC and the only answer you get is, "Does it need it right now?"

That happened to me.  I only nodded yes in answer to the question but in my mind, I said, "Well, if it wasn't urgent why would I share?"  It was an unfortunate reply to a TP request.  Here's why:

• You start to notice more things about that location: dirty tables, chronically overflowing garbage, the WC itself is filthy etc.
• You start to remember the other service lapse the last time you were there: no milk canisters out and when you tell them of this, they say they're there.  When you show the sole empty canister, they take it from you and start to fill all canisters to put them back out.
• You remember burnt coffee.
• You wonder about things you can't see but can imagine: are the fridges at the right temperature, do they clean the display case, how food is treated generally, do they adhere to a clean up schedule?
• You wonder where the managers are and you think that the staff at this location have low morale.

(In fairness to Starbucks, I provided feedback about the store and received an acknowledgement.)

Normally, I would not have shared this story because, honestly, it was gross.  Then this whole new Starbucks logo redesign came about.  I saw many articles (this, for example) reporting and analyzing.  And I saw the video from Howard Schultz (see below).

Anytime I've worked on a value proposition, branding or logo project, there was no shortage of romance.  Selling the idea to your customers during market research, selling the idea internally to management and selling the final product to the public required no small amount of lovemaking.  The only things missing were roses, candelabras and a diamond ring.  But despite the romance, we always had to ensure there was truth that went along with it.

And this video is no different.  I think my favorite is the comment that this new logo represents the essence of the brand: love of coffee, the relationship with partners and the connection with customers.  Given my recent experience, I couldn't help but think of "lipstick on a pig" (not an entirely fair thing to say).  As a customer, I didn't feel any kind of connection with them that day (or this day) so I'm not sure how a new logo will enhance or improve upon that.

And so, as they move to launch new products to launch in their stores to complement the traditional offering, I'm not so sure I'm inclined to believe in it.  I applaud the willingness to expand on their model.  They're feeling the heat from Dunkin Donuts among other competitors.  That said, I wish their work as they improve upon the brand would also include effort on superior (and consistent) customer experience and not only a refreshed logo.

After all, if there is truly love of coffee, a good relationship with partners and strong connections with their customers, then it may or may not matter what the logo actually is.

Thoughts?

Parissa Behnia
Idea Chef

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Where's the Mahi? (h/t Clara Peller)

Remember this goodie from about 25 years ago?

Now that I've successfully aged myself, you may wonder why i've chosen to take a stroll down memory lane.  Well, I've recently had two dining experiences that left me wondering something similar to that famous "Where's the beef?" line in the commercial:

• I ordered a salad for lunch one day...  Its selling point beyond the artichokes and the feta was the toasted pine nuts.  I had a hankering for them but when the salad was presented, they were switched out for walnuts without a "heads up" from the server.  I was bummed and wished I had ordered the other salad that caught my eye.
• On Monday, I ordered cioppino for dinner.  I was excited for the mussels, scallop and mahi.  Instead of mahi, there were clams again without a "heads up" from the server.  I'm not a fan of clams.  I was bummed and my overall impression of the place was kind of muted.

In the grand scheme of things, walnuts for pine nuts and clams for mahi are not punishable offenses of any sort.  But there were a couple of items that these seemingly innocent switches didn't consider and actually apply to any product though I bring this up in relation to dishes at restaurants.

One such item is the overall perceived value of the product by the customer.  We know that all businesses (theoretically) manage their margins and consequently know how much each item delivers net of expenses.  But what of the customer?  When a customer selects a salad, a widget, a shirt or anything for that matter, there's a certain overall value he/she assigns because of the features/benefits beyond the actual price of the product.  There's a certain level of utility and/or enjoyment value that gets assigned as well.

Now, it would be wrong for me to suggest we become mind readers and know that a customer values pine nuts more than feta cheese and the pine nuts drove the order.  That's not the point.  I am suggesting that we consider that an innocent switch (in our minds) may actually be a deal breaker in the mind of the customer.

In the case of the walnuts, what if I hated them and would not have ordered the salad if I saw the word walnut in the description?  We can't make the assumption that a switch of one item for the other is a thing of perfect indifference for the customer.  We have to appreciate and respect the possibility of utility and/or enjoyment value assigned to the item.

The other item is customer opportunity cost.  What I mean here is that because the utility or enjoyment value may be diminished, a customer can't help but think about the option he/she sacrificed.  It would be natural to wonder if the other item (in my case) was tastier, if it worked better, fit better or what have you.

It would also be natural to wonder if he/she should have gone elsewhere to make a product selection.  Would they have been more honest, have better quality products, be more attuned to my needs, apprised me of product modification?  In other words, the customer starts second guessing their decision in selecting us as a product/service provider.  Disastrous!

Back to that Wendy's commercial.  That hilarious 30 second spot covered both utility/enjoyment value as well as opportunity cost.  Let's hope no one ever builds a campaign about how we give customers short shrift!

Parissa Behnia
Idea Chef

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Nancy Drew and The Case of the Repeating Offer

Happy New Year!  I hope 2011 is an excellent year for you!  During the mad dash run up to Christmas, I happened to walk in a multi unit women's clothing store.  There were some nice things in the window that attracted me but what drew me in was a big red sign that said:

"Today Only!  40% Off!"

I walked in, was promptly greeted by a sales associate and told the offer was really truly that day only.  My next few minutes of the store was sheer torture.  Anything I looked at for more than a second, touched, appraised, etc., invited comment from this same associate to the point where I felt under siege and left earlier than I had wanted.  The associate half followed me out and her parting words were that I was going to miss the offer if I left without buying something that day.  

Annoying.

Especially considering a few days later, that same sign was miraculously in that store perched in its same position.  And other outposts of that store had that same sign... and thanks to identical physical layouts, the sign was also in the same position!  I don't know if other sales associates were similarly cloying - I didn't bother entering out of (very little) spite.

Admittedly, my spite may have been a little self directed.  I can't believe I believed the "today only" sign especially when there's been an oriental rug store around the corner that's been pulling this same stunt! And I can't believe this chain's gall to have that sign repeating itself like Bill Murray's GroundHog Day.  As a customer, my feelings were hurt.  As a marketer, I wished for better.

Now, I understand that the 4th quarter is always make or break time for retailers.  It was particularly driven home to me thanks to the 6+ years I working with Sears and Citigroup on the Sears private label and co-brand credit card portfolio.  Retailers do what they must to attract buying foot traffic into their stores: open on Thanksgiving for a few hours, stay open all night, offer door busters, free shipping on large purchases, customer appreciation events (h/t David Yurman!) among other goodies.

And yet, this repeating sign left me cold despite the fact that Christmas has become a money making engine.  I found it cynical.  I found it manipulative.  I found it mean.  And, I found it profoundly disrespectful of customers.

It's true that loyalty has fallen by the wayside in the search of the best for the cheapest.  Many of us forego brand/store loyalty when something becomes an irresistible deal.  I do it all the time.  And this store wished to capitalize on this type of retail ADD to win share of wallet.

I can't be the only one who noticed the repeating sign.  And while some may have shrugged, I'm sure others were a little miffed, as I was, and may be asking, as I was:

• What else in this store is misleading?  Is it the pricing?  
• Is the return policy written vaguely?  If I make a return will it be in the form of a store credit only and of limited duration?  Is making an exchange going to be difficult?
• Do they think I'm dumb?
• Is the quality worth the price?
• Do they truly want me to come back?
• Do they want me to endorse them to others?

I'm sure there are a host of others (feel free to add some).  There are no good, "positive spin" style answers to these sample questions I've posted.  There isn't a warm fuzzy that materializes when people start wondering these types of things about your business.  You don't want people to be wondering these things about your business, period.

Signs like this are, at first blush, an excellent pull tactic but ultimately, a horribly short sighted approach to building a steady customer base.  Oh sure, this chain has been around for a while and I don't think my observation will, admittedly, make or break them as a functioning enterprise.

The material point here is that this approach encourages bad behavior in that people likely have a non exclusive, casual relationship with it as opposed to "going steady" or making it the #1, go to place for all things women's apparel.  After all, why pledge yourself as a customer to a business if they display behaviors that make you question their motives.

Did you see insincere signage, too?  Please share!

Parissa Behnia
Idea Chef

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