Church of the Customer: May 2004 archives
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May 26, 2004
What should TiVo do?
TV technology watcher Phillip Swann says TiVo's marketing is inept. No news there, but with the company reporting that quarterly losses are higher than expected and Comcast saying it'll have a TiVo-like device by year's end, TiVo's future seems ominous.
What should TiVo do?
* Should TiVo continue its sole partnership with DirecTV and hope for the best (even though its current strategy is winning new subscribers but widening its losses)?
* Should TiVo openly license its technology to all of the cable services so that TiVo becomes the de facto brains behind every future cable box and rely on licensing revenue and per-subscriber fees?
* Should TiVo quickly reposition itself as a home media center to hedge itself against Microsoft's future digital center?
* Should TiVo actively seek a buyer, such as Apple, HP, DirecTV, or Comcast so that its future is more secure?
There are many other questions about the company's future direction, but that's a few.
Here's a bigger question: Can TiVo make a decision on strategy that's best for customers, shareholders and the company?
If you were an investor in the company, would you rather trust TiVo's handful of executives and its board of directors ... or... the 61,000 die-hard TiVo evangelists at www.tivocommunity.com?
This self-organized group of 61,000 TiVologists knows the company as well, if not better, than TiVo itself. Could a plurality of votes for one of several strategic options presented by the company to 61,000 die-hard customers be completely wrong? With tens of thousands of votes pouring in, the right strategy would be illuminated by the group's wisdom within hours.
TiVo (or any company doing this) would demonstrate it trusts customers implicitly. Greater trust equals more confident shareholders. Think of it as open-source decision making.
May 25, 2004
Go to where your fans live
Our most recent MarketingProfs article, "Market Like a Rock Star (Go on Tour)," is now officially making the rounds. No special rider contract required.
Give it away, give it away now
It pays to give stuff away.
That's what some musicians are learning these days while the record industry continues to sue customers for downloading music. Recent articles in Business 2.0 and USA Today chronicle the work of several forwarding-thinking artists:
* Allan Vilhan: This part-time musician from Slovakia dabbles in what he calls "trip rock" -- spooky, danceable electronica. His entire new disc is available for free download through Magatune.com. The results so far? Two tracks have been licensed for a videogame, another has been licensed by an ad agency, and fans have sent him $1,500 in donations.
* Donna the Buffalo: This Trumansburg, New York band has quadrupled its fan base and tripled its gross income since aggressively giving away copies of its music.
* Moe: This San Fransico-based band does not have a song on the radio, a video on MTV, or even a record deal. But it recently sold out the 750-seat Great American Music Hall. How? It has its own Napster network. The band encourages fans to tape live shows and distribute the files to friends.
Moe's lead guitarist, Al Schnier, says fans who share the band's music feel more invested in its success:
"We have fans who are so dedicated to our music that they want to own everything we put out... Our fans, very much in an NPR/PBS way, feel it's a voluntary effort. You can listen to NPR for free, but the people who understand it pay their membership dues. It's the same way with our fans. They're not just consumers; they're part of the equation."
With the record industry's penchant for litigious buggery combined with recent buzz that it's lying about actual record sales to shore up its legal case for piracy, it's not surprising, then, that the new breed of record company must differentiate itself by saying, "We are not evil."
All of this leads to a bigger marketing question: How would you do business differently if you operated on the NPR model, that is, customers only paid you if they chose so?
May 24, 2004
The best consultants? Customers
Fortune magazine recently provided Marvelous Market CEO Michael Meyer access to three business consultants to advise him on growing his popular chain of Washington, D.C.-area sandwich shops. (Read the story here. Requires registration.)
One of the consultants' tasks: Help Meyer develop a slogan to describe the store. They didn't produce anything Meyer liked. Why? As the story seems to indicate, because they didn't ask customers.
For any organization, your evangelists possess some of the clearest value propositions imagineable. Better yet, your customer evangelists may voluntarily help you decide how and where you should grow.
Asking customer evangelists to participate in your decision-making is a free pass for increased loyalty, stronger emotional connections and great word of mouth.
May 21, 2004
Business rock-star blogs I'd like to read
If musical rock stars can have fan clubs, why not business rock stars?
This country loves business, and business rock stars enjoy fans as passionate as the customers of their companies. Business leaders who do important, exciting work can build on that evangelism by keeping a blog.
A few already do: Tim O'Reilly has kept a blog for years. His steady hand of influence over the publishing and software industries, especially open source software, is potent. Dallas Mavericks owner Mark Cuban launched a blog this year, and he makes strong cases to change the way the NBA is officiated. If Billboard kept a chart ranking business rock stars, Cuban would be in the top 10 with a bullet.
That said, here are business rock-star blogs not currently in production I'd like to read:
A.G. Lafley
The CEO of P&G has led an astounding turn-around of the once-stodgy company that created the term "brand manager." A.G. Lafley is so cool that he even ventures out to the homes of customers to study how they use P&G's products. Now that's getting your hands dirty. A vote for a Lafley Log is at the top of my list.
Steve Jobs
Steve Jobs is the messianic maestro of magic. Is there another CEO working today who not only leads two companies -- Apple and Pixar -- but has had more profound design-driven influence on technology and entertainment? Given his penchant for secrecy, the odds of a Cult of JobsBlog are doubtful. Steve, look at it this way: A blog is an ultimate form of control. In terms of pure popularity, your blog could rival that of your arch-nemesis...
Bill Gates
As posted here earlier, a BillBlog would be huge. Just huge. Like Microsoft. Bill Gates' direct and indirect influence on computer technology development is arguably unparalleled. Bill: if your role as chief software architect is to build a vision how technology can change people's lives, why not enhance your arguments by rallying tens of thousands of customers and true believers to your vision? Even a blog focusing solely on your philanthropic efforts would be required reading. You've said you'll give away most of your fortune before you die; give away your knowledge, too!
Paul Pressler
The news out of Paul Pressler's company, Gap, Inc., continues to defy expectations. (This week, Gap reported a 54% rise in quarterly profits.) Pressler has led a big turnaround of Gap, and his day-to-day efforts to accomplish this would be required reading for every organizational development expert, MBA student, marketing executive, retail industry worker, and Gap company evangelist. Thanks to Pressler, Gap is cool again. Sign me up for the Full-Court Pressler blog.
Jeff Bezos
In the fall of 2003, I ate breakfast in a Seattle hotel restaurant in a booth next to Amazon CEO Jeff Bezos, who was meeting with interactive media tycoon Barry Diller. The personal wealth inside the restaurant that morning was astronomical, no thanks to me. As I breakfasted with my best friend Matthew, I couldn't help but think, "A Jeff Bezos blog -- called 'Earth's Biggest Blog' -- would be amazing!" (Honk laugh.) That led to my next thought, which was about...
Barry Diller
If anyone possesses a teeming vault of epic stories, it's InterActiveCorp CEO Barry Diller. His company is valued at $25 billion, and he's the Oz behind the curtain at companies such as Home Shopping Network, Ticketmaster, Citysearch, Expedia, LendingTree and Match.com (among others). What makes Diller a business rock star is that he emigrated from Hollywood, where he captained ABC, Paramount and Fox. He's the Louis B. Mayer of the Internet, and his blog would probably create valuable movie rights, too.
Herb Kelleher
Few business leaders are rightfully termed "legendary," but Herb Kelleher is. As the founder of seemingly unstoppable Southwest Airlines, Kelleher is a brilliant mix of marketer, showman, leader and manager. He's outrageous but widely respected. He publicly smokes, drinks and rides a Harley. He dresses up like Elvis. What's not to love about his personal style and the company he still chairs? With Kelleher spending the majority of his time in Washington lobbying Congress on airline issues, a Herblog would be mighty tool to sway opinion.
Gerald Haman
Another graduate of the School of Outrageousness is SolutionPeople Gerald Haman. As leader of his 10-person creativity consulting firm (profiled in Creating Customer Evangelists), Haman fearlessly dons his SolutionMan costume, which is like Superman with glasses. Haman has consulted for nearly 200 of the Fortune 500. He's the closest thing to a human idea machine I've ever met. The good news here is that Haman says he's considering starting a blog. My aggregator anxiously awaits the SolutionBlog.
Maxine Clark
As the "chief executive bear" of fast-growing retail chain Build-A-Bear Workshop, Maxine Clark is pioneering experiential retail trails. With more than 150 stores in several countries under her paws in just several years, Clark has created worldwide dens of fanatical kid (and adult) evangelists (also profiled in Creating Customer Evangelists). In person, Clark is a force of nature. Ignore her at your own peril. That's why I would dutifully study every post on a Clark BearBlog. The good news: In an email, Clark says she recently learned of the power of blogs, loves the idea and is considering starting one.
Russell Simmons
As the business impressario who introduced hip-hop into American culture and parlayed that into a hugely successful line of clothes, movies, and other businesses, Russell Simmons is a true man of influence. His current, behind-the-scenes work in politics and causes would be great blogging material. Simmons showed in his autobiography "Life and Def" that he isn't afraid to say what's on his mind. What's really on his mind. How can you not be a fan of that? Russell, I anxiously await your DefBlog.
Charles Phan
Charles Phan and his San Francisco restaurant, the Slanted Door, were recently voted the "best in California." But it's really one of the best in the country. Any night of the week, the Slanted Door is jam-packed. Mick Jagger and Bill Clinton are fans. The waiting list can be weeks, sometimes months. The service and the food are otherworldly. Ebullient and outgoing, Phan's personal story is remarkable, having come to the U.S. as a Vietnam war refugee. He attributes his success to having family members involved in his business. Fans of Phan would love to know how he does it day to day.
There's a lot more business rock stars out there. Whose blog would you love to read?
From the non-smoking high horse
Interesting story in today's New York Times about a Canadian Arctic territory brimming with addicted smokers that has -- drum roll here for my favorite cause -- prohibited public indoor smoking, including bars and restaurants.
The antismoking measures amount to an extraordinary, if necessary, experiment in social engineering for a people so addicted to tobacco. According to various reports more than half of the Inuit population, also called Eskimos, age 12 and over smoke. One 2002 study found that 80 percent of adolescents, 14 through 16, smoke an average of nine cigarettes a day, and many of them reported that they began smoking before they were 10.
Cancer rates are spiking in this territory of 27,000 people to double the national rate for men and quadruple the rate for women. One recent government study noted that 484 of 1,000 babies under the age of 6 months old suffer from lower respiratory tract infections -- the highest rate for any region in the world.
Mr. Govereau said the territory was forced to spend more than $50 million a year to transport patients for care for various diseases and conditions, many at least indirectly related to smoking, to Edmonton, Ottawa, Winnipeg and Yellowknife because hospitals here lacked the resources to offer advanced treatments. He said that if the government did not reduce those costs, they could bankrupt the health care system.
Local social scientists and health experts say they are optimistic that smoking rates can be reduced, although it will probably take a generation or two to reach the much lower rates of southern Canada. Already, they note, most smokers including Inuit living in remote areas are smoking outside their homes.
They're smoking outdoors where right now, with Spring in full bloom, the high temperature is 30 degrees. If the Intuit can do it, so can the less-frostbitten Americans.
May 19, 2004
How to lead an industry
Media consultancy Jacobs Media is setting an example of how to lead an industry.
Fred Jacobs is a pioneer radio consultant. He and his team (several of whom are his brothers) created the classic rock radio format, among others.
Now his Detroit-based firm is carrying the banner to protest the FCC and it's election-year clampdown on free speech. Recently Jacobs launched SaveRadioNow.org, whose motto is essentially, "Stop the FCC."
"Regardless of your political leanings, ill-defined and arbitrary standards have the potential to impact all points of view, from Howard Stern to Rush Limbaugh and everywhere in between," the site says. "Beyond radio, free speech restriction can have an impact on other media, too."
In the customer evangelism model, taking a leadership role on a controversial issue within your industry positions you as the emotional crucible to passionate customer loyalty. To rally the true believers within your universe into potent evangelists, fight for their cause.
(Thanks to Mark Ramsey at Radio Marketing Nexus for the heads-up on Save Radio Now.)
May 18, 2004
Tom Peters Live
Last week, I spoke at the 6th annual Service Management Forum, hosted by the customer satisfaction measurement company, Service Management Group.
Besides myself, other speakers included James Heskett of Harvard Business School, John DiJulius, owner of a business voted the "Nordstrom of the salon industry and Tom Peters, who describes himself as "the prince of disorder, champion of bold failures, maestro of zest, professional loudmouth, corporate cheerleader, lover of markets, capitalist pig... and card-carrying member of the ACLU." Now that's a description.
It was the first time I'd shared a billing with Peters, and my first time seeing the legendary guru in action. How to describe it? A Peters presentation is 90 minutes of rants, admonishments, and 139 PowerPoint slides. I really liked his riff on the two most powerful markets that most companies ignore: women and boomers/geezers. The sweetest market, he says, baby boomer women.
Watching Peters speak is like being plugged into the Matrix: You leave physically exhausted, mentally drained and wiser yet oddly uncomfortable.
May 16, 2004
Bad buzz among insects
Talk about buzz.
This story in the New York Times (by the always interesting Rob Walker) describes the Mosquito Magnet, a backyard device that devours skeeters by the hundreds, even thousands.
American Biophysics, which makes the mosquito deathtrap, wisely measures how it sells the $295 device through its various channels, such as Sears and Home Depot. The company says more than 70 percent of sales are due to direct experience with the device or word of mouth. For anyone who installs it in their neighborhood, the company CEO says the Mosquito Magnet "becomes the talk of the neighborhood."
For good reason.
May 15, 2004
The power of girl evangelism
From the New York Times about New York's American Girl Place which, like Krispy Kreme, does not advertise. Instead, it relies on incredible word of mouth and evangelism:
Before opening in November, the [American Girl Place] cafe had already taken 30,000 reservations. And this week, callers looking for a Saturday night table — prime time is 5:30 — were told that they would have to wait until August.
What's AGP's secret? Hint: It's giving kids something to talk about.
The American Girl Cafe is unmistakably kid-friendly -- the chocolate mousse is sprinkled with crushed Oreo cookies, and the napkin rings can be used as hair scrunchies -- but it is more reminiscent of Chanterelle than Chuck E. Cheese's. Embraced by banquettes, plied with smoked salmon and shortbread, and served tea from china pots, American girls here learn the ways of the ladies who lunch."American Girl is for kids, but nothing we do is dumbed down," said Kamille Adamany, the cafe's manager, who was hired away from the prestigious L'Etoile restaurant in Madison, Wis.
