A while back I talked about using icons to teach what you stand for. How about just saying it out loud to everyone who’ll listen?

Say it Loud, Say it Proud

That’s what sandwich makers Pret a Manger do. In the very small seating area of their Piccadilly store where I took this picture the other day, every wall had at least one board like these, each telling the story of Pret’s passion for food. You probably can’t read the words under the pictures so here’s the text from the top left board:

Pot Pourri — Made from delicate muslin material, our tea bags are fashioned into little purse-like pyramids, filled with organic whole leaves, hand picked in the Tea Gardens of Sri Lanka.

Ask a Pret team member to show you one — we think the Calming Camomile is particularly beautiful. A lucky coincidence really — what they’re designed to do (and do extremely well) is make a cracking cup of tea.

And it’s labelled Passion Fact No.72. The other two boards in the picture are about in-store baking and looking after basil leaves. I saw more, and I know they’ve been at it for years.

The message? Pret stands for quality, freshness, and care.

Commitment + Transparency = Accountability

Here’s the question … are all those little pictures aimed at the consumer, the staff or the management?

Visible commitments like these play well with customers who like to know what they’re getting, but transparency is even more powerful for the staff and management. With such a public commitment to quality, can anyone inside the company — whether a sandwich maker, food buyer or senior executive — be in any doubt about what’s expected of them every day? About choosing quality over price? About decisions over storage, or packaging, or recruitment or any other operational detail?

This isn’t about top down management. It’s about accountability.

Public declarations make everyone responsible, not only for living up to the commitment itself but to call out inappropriate behaviours too. Seeing this on the wall, what team member wouldn’t argue against reducing quality to save a penny a tea bag?

We don’t all deal in freshness or food, but we can all make our intentions clear, and ask everyone around to help us live up to them.

What boards would you hang on the wall? What else can you do to make your commitments transparent and to hold each other accountable for living up to them?

Some marketing messages just hit you between the eyes.

I was in Philidelphia’s Reading Terminal Market to discover the delights of the famous philly cheesesteak and the sign in the picture had me straight away.

“Pizza & Cheesesteaks” is the simplest kind of marketing message, relying on the idea that if you want a pizza or a cheesesteak, and you want it now, you should stop wasting your time and buy it here. It’s a straight forward tactic that worked well for the cheesesteak that day and for commodity products any day.

But what if your product is a bit more complicated than fast and cheesy food?

Leading a team that wants to skip to market with a reputation for great products means weaving four simple ideas into every part of your go-to-market thinking. The first two often get lost under the heading of marketing — remember the old saying though, marketing is too important to be left to the marketing department — the second two are pure product development, but all four are built from the ground up.

Simple Description

What is in the box? The idea here is to give your customers a simple way to describe what you have to offer, whether it’s cheesesteak, a micro-blogging platform or a jet engine.

If you’re struggling to work out what you’re selling, listen in to what your existing customers already call it. Don’t worry about trying to differentiate here — the in-the-box question isn’t supposed to turn up a unique answer, but a framing one.

Simple Value

Why would I buy it? If I’m in the market for what you sell AND you come up with a great reason to buy, you have a least half a chance of turning me into a customer.

So what’s the value, what will it do for me? Will you fill that huge sandwich shaped hole in my stomach, connect me to the world in less than a minute, haul an aeroplane full of paying passengers/cargo into the sky at the lowest cost per unit?

Of course, the best marketing messages are stuffed full of differentiated offers and compelling thoughts. Marketing communications people spend their day doing this but they sometimes lose sight of the true value. However persuasive the copy, and however sophisticated the message you have to get across, make sure you don’t obscure the simple description and simple value of what you have to offer.

The point of marketing is to ease a customer’s path to your door — good marketing means I’m more likely to try, and even persist with a product for a while — but the success of the product comes when I incorporate it into my daily life and tell my friends about it. And that means it better be simple to use too.

Simple to Use

Don’t make me work (too hard). Marketing may provide customers but the product lives or dies in the hands of the customer.

Any product that’s difficult to use risks a future covered in dust and destroys almost all chance of positive word-of-mouth. Products should be as intuitive as possible but the creators are usually the worst judges — so get out of the building, talk to customers, test, test, test, and then act on the results.

Simple to Extract the Value

Help me be successful. Ultimately, you have to deliver the value you promise. You’re not selling widgets, you’re selling what the widgets can do for the customer.

Send your customers on an unsupported voyage of discovery and they might get to the promised land but more likely they’ll bob around on rough seas. Build a support network around your customers that helps them get exactly the result they wanted when they dipped into their wallet.

The Ultimate Benefit

Of the four simple things, the ultimate benefit is the value that customers extract. Great products, reputations, and word-of-mouth are all built when customers do things more quickly, more easily, more cheaply, or just better than before.

The ultimate benefit means success for the customer and success for you.

The success of my cheesesteak? My stomach complained but my face was smiling.

A little bit lost in Maryland this summer, my family and I came across Glen Echo Park, a once popular destination that’s seen hard times and is on the way back through the involvement of a dedicated not-for-profit tribe of volunteers.

Most of our visit was spent at the carousel where I was smitten with Smarty Jones. Mmmh, mmh that’s a handsome looking horse – if I’d have been riding I’d have taken Smarty for a trot for sure.

But for the whole time we were at the park, not one child rode Smarty.

What’s wrong?

Why don’t some customers buy your product? If it’s anything like Smarty, it’s great: accessible, goes up and down, has all the features, stands out in a crowd, it’s super-shiny for goodness sakes.

So why does the turkey get a ride whilst good ol’ Smarty puts on a brave face?

It’s the kind of question I get asked all the time. “We have a great product, but there something wrong. What is it?”

Whilst every product has it’s own story, the tale is put together the same way every time — and anyone can do it.

Ask your customers

Act like a consultant and ask your customers. You’ll learn more from what goes wrong than what goes right so make sure to ask non-customers who’ve made an active choice not to buy, and actual-customers who’ve bought but have stopped using. Get out of the building and ask the people who know. Visit, lunch, interview, test, survey — whatever it takes to get the information you need.

Speak to enough customers to see patterns; some will point to lack of priority or urgency, others may point to weaknesses in your product or your proposition. Assume nothing, test everything. When you’re pretty sure you know what’s going on, it’s time to act on what you’ve found.

What are you going to do about it?

There are three layers where you might need to fix things inside the building:

• Message problems are easiest and cheapest to solve. Get together with your sales and marketing team and change your presentations, messaging, communications. Use A/B testing to see what changes work best — especially if you’re web based and have a lot of passing trade.
• Go-to-market problems are more strategic and will probably force a new look at your market, features, distribution, pricing and positioning choices. Everything in this layer is connected so be suspicious of anything that looks like a silver bullet.
• A weak or ill defined core proposition means a fundamental rethink and the discomfort of living with your current product whilst working back through first principles.

After two interviews (my own children, 40% of the carousel kids that day) it was pretty easy to work out Smarty’s problem. Too much competition and a very small market. Strategic problems with no answer in sight means old Jones could be racing to retirement.

What about you? Can you change priorities and raise urgency or do you have to go a little deeper?

What happens when prospects don’t say Yes and won’t say No?

A Maybe is a hole in time. Complex products live with decision cycles that can last longer than a dying star. Entire companies have disappeared into Maybe shaped black holes. Listen carefully and you can hear them screaming “Just one more meeting, and I think we’re theeerrrreeeee…” as they fall across the event horizon.

It’s not always a problem. In a must-win, absolutely-no-choice, do-whatever-it-takes-to-keep-the-lines-open, a Maybe is the bread of life. If you’re operating bespoke — a new kind running shoe specially made for Paula, say — then you’re mission bound to keep the door cracked open.

Sometimes a Maybe isn’t even on the cards; it’s a Yes or a No, period. Simple products, the kind that leap to a decision in a single meeting, shouldn’t be a problem. Assuming you have good products and give good meeting, you’ll walk away with a Yes often enough.

I always prefer a Yes, but what if the choice is between a No and a Maybe?

What’s wrong with chasing rabbits?

Problem is, a Maybe sounds so possible — (just one more meeting). The more well funded you are the more likely you’re able to chase all these rabbits. The less well funded you are the more likely you’ll feel you have to. But as the saying goes, chase two rabbits and they both escape. Don’t confuse busy-ness with progress and don’t be seduced into endless streams of meeting-email-meeting-email-meeting, with your entire sales pipeline sitting at 75% probability.

Here’s the way I see it:

• Major sales take time and multiple meetings
• There aren’t enough resources to go the distance with every Maybe
• Use first meetings to find champions and ask for what you need

Let me explain.

Major sales are complex. New products are an untried cocktail of opportunities, costs and risks that force buyers to sit on fences for as long as it takes. Assuming your product shows promise and you make a decent fist of telling your story, it’s likely you’ll have no shortage of possible customers who are balanced on their fence whilst they “continue” talking to you.

Too many continuations and not enough progress saps the time, energy and finances of any team. The trick to maximising the effectiveness of all three resources is to focus on the “probable” customers and let the “possible” customers wait until they, or you, are warmer.

Find your champion

In other words, only dig wells where you’re sure there’s oil. Sadly, you can’t KNOW where to set up camp, but you can look for the single feature that marks out high potential territory; the presence of an identified champion inside the customer organisation. Not a point man or sponsor who simply arranges meetings for you, a champion is someone who sees the potential of your product, who pushes for progress and fights the good fight inside their own company.

Ask for what you need

How do you find these people? If you’re getting that Maybe feeling at the end of a sales meeting, do what you can to push for a Yes or No. The quickest way is to tell the truth and ask for what you need, “As you can see, we’re a new company and this is our first product. We’re fully committed but we know we’re not right for everybody at this stage. We’re looking for visionaries who can see the potential of what we’re doing and who want to work with us.”

Or, “So, we’re a small company that’s looking to expand by working with some new customers. We’ve had a good discussion today and I get the feeling you’re interested. What are the next steps that will progress our working together and who should we work with?”

Or … something else.

The idea here is to drive for a “Yes, we want to make progress, it will work like this…” or a straight “No thank you” as quickly as possible.

The more open you are about what you need, the more likely you’ll spend your time with probable, rather than just possible, customers.

Is this crazy? Maybe you should do everything possible to keep all prospects warm? Never giving an opportunity to say No? What do you think?

Image copyright: geishaboy500 via Flickr

No. Na. Nope. Nya. Ummm … no. No siree. Not me. Oh, maybe, hang on a second, er, sorry, no.

I have no idea what should be in your budget and it’s a simple truth that no one else does either. They may have a first clue about what they want to be in there and what it should all add up to, but beyond that … they know nothing.

You do.

A play in three acts

In theory, budget setting is a simple play of three acts.

Act 1 — Setting — What happened last time, in words and numbers?

Act 2 — Thinking — What will change next time? Including anything that’s different inside the company, like targets and constraints, or outside the company, such as market conditions, competitor movements and new technologies making headway.

If you aren’t given objectives, set them yourself. If you don’t know what’s happening in the market, go find out.

The better you understand the variables the easier the planning will be (and the more robustly you can justify your choices during review meetings).

Act 3 — Planning — What do you plan to do, in words and numbers?

After discussion, comes decision. What will you spend in order to achieve the objectives? How is that different from last time? Why have you made those choices?

Give yourself a budget and a target. The budget is a promise, so don’t make promises you can’t keep. The target is a stretch motivator, something to shoot for, to achieve if … if … if, but not a fantasy. Pinning everything to a fantasy is the surest way to demotivate everyone and guarantee failure.

That’s the theory. What’s the reality?

Budget meetings can be bloody. Turn up with a low ball, last year +/- 10%, no thinking, generous pay rise, doubled marketing spend, steady state budget and you probably deserve to get juiced.

Budgets are all about numbers but like so much else, they’re really all about preparation. Get set, have a strong and reasoned argument for every change, be ready to walk through every penny — you’ll skip out of the meeting with a firm budget, a warm glow and a polished reputation.

Sadly, some review meetings are an ego trip for the finance team; they think it’s their job to beat you up. You owe it to your team to deal with them like any other bully — look ‘em in the eye and stand firm.

Ruined by game playing and phoney smiles, managing in the pursuit of skippiness means taking budget sessions as a brilliant opportunity to align your whole team behind a coherent plan.

Image copyright: DoctorTac via Flickr

By the end of a sales call you should have a pretty good idea who you’re dealing with. I’d say most people will fit into one of five categories:

1. We don’t have a problem — some customers simply don’t have the problem your product or service is designed to solve. Some customers have the problem but are unable or unwilling to see it. The final possibility that sits here is that they know they have the problem, but they don’t believe your product can solve it.
2. We’ll wait for a major player — people buy from people that they know, like and trust. The wait-for-a-major category accept they have a problem and that you may even be able to solve it, but they’re unwilling to take a risk on a company they don’t know. It may be slightly unfair that they’ve invited you in when they’re too risk averse to buy from an unknown.
3. We’ll do it ourselves — I always hire someone to paint my house, the guy next door never would, ever. Some people, departments or even entire organisations are more like me, some are more like my neighbour and will try to do pretty much everything on their own. I’m sure they don’t invite people in just for the influx of ideas, but for some reason, when they see something new, they imagine it’s easier or cheaper to do it themselves.
4. Come back with version 2 or 3 or 4 — some people are always waiting for the next version, or until the price comes down, or for some other imagined improvement that they know is on the way. They might think you’re not yet ready for their particular situation yet, or that they’ll wait until other people have helped you iron out your kinks.
5. Looks good, what are the next steps?

Many people can be nudged from any of the first four categories into the final group. Many can’t.

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Inside any kind of organisation bigger than the land of Me & My Mate, you’re probably surrounded by people who do a job that’s completely different to yours.

What do all those people do?

I’ve been thinking about the doing part of that question lately, rather than the people part. The way I see it, no matter what the job title or department, the doing falls in to one of only five categories:

Making Promises – easiest to think of as all the things that happen in sales or marketing, some customer services and board functions. Anything that makes any kind of commitment on behalf of the company is a making promises action.

Keeping Promises – everything that even vaguely fits into operations: all the tasks that make the product, perform the service, look after customers, pick up, package or deliver the thing.

Measure and control – all the things involving numbers or making sure nothing gets out of hand.

Support – what gets done in order to make everything else function; what normally happens under the headings of IT or HR for instance.

Leadership and innovation – without getting bogged down in book style definitions, leadership is about direction setting and steering to the compass whilst innovation is all the processes that aim to improve things.

These are not departments, they’re functions, and whilst every person spends most of their time in one kind of role, they probably undertake processes in others, if not all. For example, a production worker is mainly employed to keep promises, but they probably also try to innovate to improve things, keep an eye on production rates and quality, put their arm around colleagues when they need it, and continually make commitments within and for their department.

Ok. So what? Is this anything other than yet another way of thinking about organisational structure?

If every process is about making, keeping, ensuring and supporting promises, or improving the way the whole thing gets done, then every job is about the customer.

So what do all those people do? Let’s hope they’re not wasting any time discussing, deciding or doing anything that doesn’t draw a straight line to improving the life of the customer.

When I went to see Jack Welch speak on management, I knew what I’d be getting – candour, leadership, persistence, values – no need to explain, no sales pitch required. You had me at the name.

When I’m looking for a coffee and comfort in an unfamiliar town, finding a Starbucks makes me smile.

A brand that I know, like and trust is a short cut to the top of my short list – very often, it’s a shortlist of one. Nothing new there, brands are important, let’s move on.

If brands are important, how do I get one? How to build a reputation people trust?

Make a promise people care about – or, put another way, build a fantastic product that people want. I know that sounds so obvious that it’s hardly worth the pixels it’s displayed upon but a) there’s loads of rubbish out there, and b) there’s plenty of products, particularly technology products, that nobody wants or cares about.

Tell them you exist, in a language they understand – or, put another way, talk like you care about the customer rather than about yourself. The language you use to talk about your thing internally may be the same language that your customer uses externally, but it’s probably not. Use customer language, not marketing/management/leading/essential speak.

Deliver, deliver, deliver – or, put another way, fulfil your promises. We buy from people we trust, prove you deserve it and we’ll buy again and tell our friends.

Reputations are built around happy customers. Customers are happy when we do what we say we’re going to do, and we do it brilliantly.

See what you think:

This morning I came across “Keep Doing.” Like the first, it was made by UK agency Wieden & Kennedy, voiced by Garrison Keillor, and riffs on the theme of sorting things out.

I can’t imagine playing Keep Doing for people whilst we wait to start a meeting – which I did countless times with the 2006 ad – but I can already feel this quote working its way into my world.

Doers do things, things to move us forward, to make stuff better.

There’s questions, and then there’s BIG questions? Charge too little, don’t make enough money, go out of business. Charge too much, don’t sell enough stuff, go out of business. So, how much?

For a question that’s been around for as long as business itself, you’d have thought there’d be a pretty good answer by now. Here’s the slightly scientific one,

• Forget sunk costs.
• Work out incremental costs – how much does it cost you to sell each additional unit, including the cost from you’re suppliers and everything you have to do before it gets sold?
• Work out the demand for your product (in units) at every price point you’re considering – this is called a demand curve.
• Find the point on the demand curve that produces maximum total profit (price minus costs times units sold).
• That’s it.

The problem comes in step three, working out how many units you’ll sell at any given price. It seems like a good idea but is, um, practically speaking anyway, most of the time, um, impossible. You can only really do it with actual paying customers (otherwise the data is extremely, by which I mean extreeemly unreliable), and then you need a sample of thousands to get a decent demand curve. And after all that, if you experiment with actual paying customers you run a distinct risk of pissing them off.

So, after all the maths behind all the models in all the books, we’re left with educated guesswork. I bet you knew that anyway.

Pricing for new products is low data. Accept that pricing is inexact and let your first few customers help you find the ball park. After that, work hard and listen hard.

This chart might help. Working from the bottom up, the left side shows that you buy things in from suppliers, add your own costs and sell at a premium over your combined costs, customers benefit more than they paid. The right side shows that your efforts should add value and allow you a healthy profit whilst leaving enough on the table for customers that they’ll be happy they got involved.

If you’re running a business in the pursuit of skippiness, figure out what price lets you reinvest in the organisation and the product whilst keeping shareholders skippy and customers keen to help. Charge that.

(Picture credit – I knocked it up but it leans VERY heavily on one I first found in Strategy Maps by Kaplan and Norton.)

(Whilst thinking about this question I was reminded of the fantastic Camels & Rubber Duckies post by Joel Spolsky on his blog, Joel On Software. Much longer, includes much more theory, really intended for a software audience but well worth the time for anyone struggling to come to terms with pricing.)