Scarlett of Suburbia

Field Notes from The Motherhood


November 2009

Ten easy ways to murder a business ::FT

“How to murder your company in 10 easy steps”.

1. Take on too much debt. Companies usually go bust because they owe the bank too much. If you have no borrowings, you can survive a lot. We have lived through an era where it made sense to borrow and buy if you could; now everything has changed, and certain lenders are taking no prisoners. If there are problems looming, move early to raise capital. If you leave it too late, there may be nothing left to save.

2. Choose the wrong business partner. Plenty of companies hit the wall thanks to disputes between owners. It happens even between siblings. If you go into business with someone, be cautious before taking the plunge and have a proper subscription agreement – and keep communicating, even if you disagree.

3. Become overdependent on one customer. Most small non-consumer businesses have just a few clients. If they lose a big one, they are likely to fall into sharp loss. The answer is to diversify if you can, and try your best to be an irreplaceable supplier so that you can never be dumped.

4. Get ill. Many small businesses sink because the founder gets sick or injured, and therefore can’t work. So take exercise, eat sensibly, drink in moderation, stop smoking, buy insurance and try to plan management cover in the event of an accident or other enforced absence.

5. Make a mess of a major IT project. I have seen companies hit the rocks because they spent fortunes on computer systems that did not function properly. I’m not suggesting you never invest in technology, but make sure you take expert advice, and embark on such a move only when the time is right.

6. Get into a price war. Companies frequently undertake suicidal contests with rivals in a desperate attempt to seize market share. This tends to be a zero-sum game that benefits customers only, and leaves the operator with the least cash broke. I prefer to sell on quality or other differentials. Discounting is a dangerous pursuit.

7. Sign a burdensome property lease. I have witnessed many professional services companies go under because they signed a long-term lease on too much office space at the wrong rent – and then revenues collapsed. It must be the main reason for accountancy, law and architecture firms having to dissolve. Now would be a great time to start such a business if you can generate the orders.

8. Forget your customers. I am constantly surprised at how often one experiences poor service, especially in competitive fields. Almost everything is a repeat business, and if you are treated badly by someone, you don’t purchase from them again – and you tell your friends not to go there too.

9. Never evolve. Successful companies can fall into the trap of saying “If it ain’t broke, don’t fix it” to every innovation that comes along. They grow complacent and allow newcomers to eat their lunch. Long-term winners are always improving, questioning, adapting. No commercial formula lasts for ever.

10. Don’t bother investing. Certain proprietors strip their business of every penny of cash, starving them of capital. But every undertaking requires maintenance and refreshment – otherwise the facilities grow tired and inefficient, and new product development evaporates. If you dividend everything out, you will eventually discover that you own a wasting asset.


Learn from Luke Johnson, the Chairman of Channel 4 (in the UK). He runs Risk Capital Partners and has backed companies guilty of all of these mistakes.


The 10 Questions You Should Never Stop Asking –

Here are the 10 questions we should have been asking–the same questions that any business owner should continue to ask, year in and year out:

What is our purpose for existing? A lot of businesses had a purpose when they started, but over time their product, service and market changed. The arts magazine was created to give the Philadelphia area its first publication that focused solely on the arts–theater, opera, ballet and the orchestra.

The business magazine was competing against a variety of daily and weekly business publications, so its purpose was unclear. Was it a local Forbes covering large companies? Was it a local Inc. highlighting small businesses? The editor decided it would be a combination of both approaches–and readers weren’t sure what to make of it.

Who is our target customer? We knew the readers of the business magazine were business leaders because we bought lists and sent the magazine for free to C-suite executives–the audience that our advertisers wanted to reach.

Our arts magazine partnered with the local public broadcast station and used its listener base as the profile for its readers. Still, we hadn’t truly pegged the age and income of the readers, and thus had a hard time convincing advertisers to support it. Needless to say, it’s a lot easier to come up with great ideas and convince people to buy into them if it is clear who is purchasing your product, and why.

Why does anyone need what we’re selling? All too often we fall into the trap that people want something because we like it. This is the road to perdition. In our case, there was never a formal survey done to determine if anyone cared whether our magazines existed. We never asked readers/potential readers what they wanted to read. In my 25 years of experience, I have rarely seen a company fail if management literally spoke to customers and gave them what they want.

If there is a need, is it enough to support a profitable business? Although Philadelphia has an orchestra, ballet, theaters, jazz clubs, etc, Philadelphians weren’t interested in a magazine that just focused on the arts. When our agreement ended with public broadcast station, there wasn’t enough reader interest to attract advertisers.

What were our competitors up to? If we had formally analyzed our competition, we would have seen that one competitor of the business magazine had come up with interesting advertising vehicles, such as paid-for question-and-answer series with profiles of accountants, lawyers and business consultants. These featured professionals were more than happy to pay for the privilege of raising their visibility. Whether you are selling a product or a service, you have to be constantly innovating.

Can you reduce expenses–without harming the product? I found out about six weeks after my arrival that if you lowered the weight of the paper and took the shine off the magazine, you could save a bucket-load of money. Of course, those moves also lowered the quality of the product. When I began my search for a new sales manager, one of the candidates asked me if I had spoken with our printers about ways to reduce costs. Amazingly, our vendors had lots of ideas on how to reduce cost without sacrificing quality, but no one had asked them.

Do we have the right leadership? As companies mature, they require managers with different skill sets. One of our publishers was very experienced at running start-ups at large, well-financed publishing companies; he wasn’t used to running on a shoe string. The other publisher, who had never run a company, was used to selling air time, not space in a magazine; when she did sell air, it was for a top-rated established station, not a start-up. (We ended up replacing both publishers.)

Do we have the right employees? There are employees who know how to bring new products and services to life, while others know how to nurture an existing line. We had sales people who were very experienced at selling established publications, but none who had ever launched a title or worked with a small publication. Big mismatch.

How will we continue to drive revenue? The management and board never held a down-and-dirty strategic planning session. We never went to a bar and tossed around ideas with employees. We never invited readers to tell us what we could do better. Companies can’t live in vacuums. Chances are, what works today won’t work tomorrow–just ask anyone in the media business.

How are your employees holding up? I was so obsessed with finding ways to fix the business that I would walk by everyone as if they were pieces of furniture. I didn’t observe their body language or solicit their input, even though was I playing around with their future. I was in my own little world and I didn’t notice the anxiety they were dealing with. You have to check the temperature of your employees, let them vent and encourage their honest feedback. These stakeholders are the key to pleasing your customers–and your shareholders.

December is a great time of year for asking yourself these questions that are appropriate for any sized business.

Advice for Retailers: Stop pushing the xtd warranty and open up a few more checkout lanes!

Consumer Reports has compiled the list of "top holiday-shopping annoyances", which include: being pushed to sign-up for store credit cards; requests for personal info like you're phone number and "being hounded with the extended warranty sales pitch." Shocking.

72% Stores that never open all of the checkout lanes

68% Fake "sales". If something is always 20% off, it's not on sale

67% Coupons that exclude almost everything in the store

62% Being endlessly hounded with the extended warranty sales pitch

58% Cashiers that ask for your phone number or other personal information

56% In-store prices that do not match the same company's on-line prices

53% Employees required to up-sell you at the register

52% Pushing store credit cards at the register

50% Mail in rebates

48% Stores that require loyalty cards to get discounts

43% Stores that have a minimum purchase requirement for credit cards

26% Receipt checkers

Twitter Lists are Direct Marketing on Steroids

Recently, Twitter launched a new feature that allows users to create lists of people on Twitter … making the site infinitely more useful for users who need some help navigating the flood of information that comes from the site. 

1. Improve your PR “hit rate.”
For several years now, there have been people who you might consider “influencers” in just about any industry creating content online. In your industry, that might be online reviewers, or bloggers, or key contributors to online communities. The problem for some time has been that it is increasingly difficult to capture their attention. As more large businesses launch “blogger outreach” campaigns, the attention of these influencers (bloggers or otherwise) is becoming more and more difficult the capture. Luckily, getting “coverage” on Twitter is often a much more simple ask. As a result, if you focus on asking to be mentioned through a Twitter stream, you can make it much more likely that someone will share their experience with you, or a useful message more readily through Twitter.

  2. Get listed. The way Twitter lists work is that anyone can create a grouping of people or organizations on Twitter and put them into categories. These lists can be followed in bulk, which answers one of the biggest questions about Twitter … how can anyone find new people to follow, and how you can get new followers. With a search, you can now find lists of Twitter users that relate to the category your business is in. In many cases, you can approach the creator of the list with a request to add your business to the list if it is relevant. With a few hours of effort, this means you could connect with the most visible list creators online and dramatically improve the chances that people will find and follow your Twitter account.

3. Create your own collection.
If there is any lesson that social media can teach you, it is that demonstrating your business as have expertise in a particular space can have big benefits, whether it is a services based business, or you have a product to sell. One of the ways to demonstrate that expertise that doesn’t require you to write new content or create multimedia such as videos is simply using the Twitter lists feature to create a new list on any topic. For example, if you have an interior design business – go out and find the 25 best Twitter accounts talking about interior design and create a list. Then you can email this list to people in your industry, share it through Twitter. Anyone who sees the list and its creator (you and your business), will immediately begin to perceive you as a thought leader and expert … if they don’t already.

4. Monitor for moments to respond.
One of the best things about Twitter is that in the stream of real time dialogue are always questions from people seeking a response. With every post having a time and date stamp, it is very easy to dip into Twitter at any time to see who is having a particular question that relates to your business and exactly when they asked it. Taking this information, you can start to answer questions directly to people and share your point of view and expertise. Doing so can not only give you a chance to connect with potential customers directly, but also to have a “viral conversation” … in other words, a conversation with an individual that could easily be shared by others and passed around the web. 

Nice summary from Rohit Bhargava on targeting low-hanging fruit thru Twitter lists.

Lessons From the Creativity + Tech Conference

Re-imagine digital as product development
James Hilton, co-founder and chief creative officer at AKQA, discussed awards darling Fiat’s Eco:Drive, the web-based tool that turned driving data into recommendations for consumers to save money and reduce their carbon footprints. The insight behind the campaign, which won best in show at One Show Interactive this year, was thinking of the “campaign” as a product. Interactive efforts need to grow beyond the microsite lifespan of a few weeks to long-lasting platforms that provide consumers value indefinitely.

“We are not in the business of advertising anymore,” said Mr. Hilton. “Brands are interested in making products, whether you call it ‘products’ or ‘platforms.'”

On a lighter note, Mr. Hilton shared a lesson in national driving habits. According to the application’s data stores, Italians are the worst drivers in the world, followed by the French, the British and the Germans. The British were the quickest to learn and improve from Eco:Drive’s recommendations, followed by Germans, the French and then Italians.

Sit close to technologists
Technologists — “the artists formerly known as IT guys,” according to moderator and Ad Age events manager Nick Parish — are essential in making interactive products like Eco:Drive, so familiarize yourself with technology and its restraints to inform your role in the idea-generating process. Also, bring tech-heads into creative conversations early to color communication ideas with what’s possible in web development. “We are now inventors,” said Matt Ross, head creative, Tribal DDB. “We bring creativity and technology together.”

Plus, for creatives, understanding technology could be a matter of survival in the near future. “If you are a creative and don’t know about technology, you’ll be out of a job soon,” said panelist Yates Buckley, technical director at digital production company Unit 9.

Making technology easy, isn’t
There are a lot of tools available to digital creatives and technologists today, so the real challenge is distilling the highly technical into an intuitive consumer experience. To make the graphs- and data-saturated Eco:Drive palatable to consumers, Mr. Hilton shared AKQA’s guiding principles for work: useful, usable, delightful.

He also coined a term for using available tools like Flash excessively just because they are available. To the consumer, the experience is what matters, not how much digital skill went into constructing brand communication. “Flashterbation, no,” he said. “Simplicity, yes.”

Look beyond short-burn ROI
AKQA’s Mr. Hilton cited his client’s long-term perspective as a key component to creating a platform with staying power. While only brands like the Toyota Prius were getting credit for environmental awareness, this campaign aimed to influence driving habits to reduce carbon emissions and align Fiat with that eco-consciousness. But to build that brand personality, it takes time.

“It’s not about banging out a quick campaign,” he said. “The most important metric for brands is return on long-term investment, rather than short term ROI.”

Learn how to design data
The influx of data collection and cataloging will only continue, which means creatives need to become adept in designing data to be digestible for consumers. Usman Haque, director of his self-titled design studio, introduced the platform Pachube, a web system designed to connect any space to any space, or any device to any device to share contextual data. While the technologies to support digital readings of the time, temperature or other atmospheric data of a physical space are not widely available today, “the internet of things” is not far off.

Similarly, Nokia’s Mr. Greenfield discussed the concept of a network city, where data — might it be bureaucratic, health or traffic — harvested from urban systems can be fed back to change things like traffic patterns or building conditions in real-time.

“We need to stop thinking of the city as bricks that don’t communicate,” he said. “In the computer revolution, every constant in the world becomes a variable; everything around us is scriptable, which makes everything deeply interactive.”

Content will soon be tagged to the real world
How will your brand overlay the real world with bits of digital content? With smartphone video cameras, GPS and internal compasses; technology that started as a cool way to interact with 3D graphics online has evolved into a way to project bits of information over video of real-life locations. Markus Tripp, business development manager for wireless developer Mobilizy, introduced the concept of a “content ecosystem,” where the real world is tagged with digital content or graphics and users can access that information with their mobile phones.

He demonstrated Wikitude 4, an upcoming application from the developer that tags user-generated content to real-life locations. Claire Boonstra, co-founder of augmented reality app Layar, demonstrated her open-source tool, which brands or publishers can leverage to create their own “layers” of content to be projected on the world.

Think outside the box
Smartphones have the potential to re-imagine the package. How would your product’s package design change if users could access additional information by snapping a photo of your barcode? Bringing the idea of “the internet of things” to consumer package goods, Mr. Haque discussed how smartphones could make it possible to trade in busy, graphics-heavy packaging for digital content retrieved by snapping a photo of a barcode with a smartphone. “All the things we’ve been trying to communicate with graphics can now be delegated to informatics,” he said.

Every executive needs to read this summary from AdAge. It’s not about maybe/someday — this is real and happening today. It is already affecting businesses. Those who jump on board *may* survive the next decade.

Most won’t.

And that’s okay b/c we don’t need that kind of old school thinking to accelerate American/Global business.

Send postal mail via an email address or Twitter

By working with a home delivery courier company that they say will pick up and
deliver parcels more cheaply than Royal Mail, they have managed to remove
the unreliable state-backed giant from the equation.

This, in one well-wrapped package, is, which launches to the
public tomorrow.

As Cumbrian-based chief executive Glen Richardson, 27, puts it: “Why take
a parcel down to the local post office, sit in the queue and pay £5 when you
can sit in front of your computer and have a courier turn up at your door
the next day?”

SendSocial’s pricing starts at £3.99 for parcels weighing up to 2kg, rising to
£7.99 for one weighing between 5kg and 10kg.

The service works by letting the intended recipient known that someone wants
to send them something. It asks, via social messaging site or
email, whether they want to receive the parcel and, if they do, where they
want it delivered. All this information is stored securely on SendSocial,
using the Verisign system of encryption.

The sender is then given a barcode address that tells the courier where the
parcel is to go but does not reveal any address details to the sender, who
will need a printer to print out the barcode label. The next day the courier
turns up and between three and four days later the parcel is delivered.

How SendSocial came to be is a tale of the times: an idea posted on an open
blog in March by serial British entrepreneur Ben Way, 29, who is now based
in Florida; then some furious online collaboration involving entrepreneurs
who did not meet physically or even know each other particularly well;
finally some viral marketing on Twitter with the neat twist that the first
100 people who agreed to spread the word were given free profit-share stakes
in the company.

The initial stumbling block was over the ability of an internet start-up to
physically handle such a volume of parcels. But this was overcome when the
now eight-strong team realised that if they could find a courier partner
prepared to alter their logistics systems to cope with “address-less”
packages then SendSocial could concentrate on building the software and
becoming a secure repository of customer addresses.

They spotted a press release from courier myHermes, which was launching a
competitively priced national door-to-door service, and things went from

The team, which includes chief executive Simon Campbell and 18
year-old Newcastle internet entrepreneur Jonathan Grubin, all operate from
different locations and worked on the project using Google docs.

Richardson thinks SendSocial’s potential is enormous. While the initial target
is social media users, the system should appeal to mainstream retailers and
direct marketing groups looking to provide a better customer experience.
Some large companies are already recognising this potential. Richardson says
greeting cards are likely to be next in their sights and early next year, a
large US courier company is likely to send SendSocial global.

The Brits *always* come up with fabbo ideas. How deceptively simple this is — insight being that we never have people’s addresses to hand when we need to ship them something.

Can’t wait for this to arrive in America. Maybe they’ll be able to do it using phone numbers too?

Detroit: An American Catastrophe

In many ways, it’s like a ghost town. It’s eerily quiet. Driving around in the middle of the afternoon, in a city that once was among the most productive on the planet, you see very little traffic, minimal commercial activity, hardly any pedestrians.

What you’ll see are endless acres of urban ruin, block after block and mile after mile of empty and rotting office buildings, storefronts, hotels, apartment buildings and private homes. It’s a scene of devastation and disintegration that stuns the mind, a major American city that still is home to 900,0000 people but which looks at times like a cross between postwar Berlin and the ruin of an ancient civilization.

Detroit was the arsenal of democracy in World War II and the incubator of the American middle class. It was the city that taught mass production to the rest of the world. It was a place that made cars, trucks and other tangible products, not derivatives. And it was the architect of the quintessentially American idea of putting people to work and paying them a decent wage. It’s frightening to think seriously about what we’ve allowed to happen to this city and what is now happening to the middle class and the American economy as a whole.

I was in Detroit with Harley Shaiken, a professor at the University of California, Berkeley, who specializes in labor issues. He grew up in Detroit and his love for the city and its people are palpable, as is his grief for the horrors the city has endured.

The popular narrative of what happened to Detroit contains a great deal of truth but its focus is too narrow to account for the astonishing decline of this former industrial colossus. Yes, there were the riots of 1967, and white flight; and political leadership that was not just shortsighted but at times embarrassingly incompetent and corrupt. And, yes, the auto industry was a case study in self-destruction.

But as Mr. Shaiken points out, Detroit was still viable enough for the Republican Party to hold its convention here in 1980, when it nominated Ronald Reagan. And it was not the riots, but the devastating recession of the early ’80s that really knocked the city senseless. “That’s when the place really cracked,” said Mr. Shaiken, “and that was about aggressive globalization and the lack of an industrial policy, not the riots.”

Detroit and its environs are suffering the agonies of the economic damned because of policies, crafted at the highest national and corporate levels, that resulted in the implosion of crucially important components of America’s manufacturing base. Those decisions have had a profound effect on the fortunes not just of Detroit, or even Michigan, but the entire U.S. economy.

“We’ve been living with the illusion that manufacturing — making things — is so 20th century,” said Mr. Shaiken, “and that we could succeed by concentrating, for example, on complex financial instruments while abandoning the industrial base that sustained so many American families.”

The idea that the fallout from the wrongheaded economic concepts of the past 30 or 40 years could be contained, with the damage limited to the increasingly troubled urban areas while sparing prosperous suburbia, has now proved as phony as Bernie Madoff’s fortune. Americans, whether they live in big cities, suburban towns or rural areas, need jobs, and when those jobs are eliminated (for whatever reasons — technological advances, globalization) without being replaced, the national economy is guaranteed at some point to hit a wall.

Professor Shaiken and I drove past vast lots filled with rubble and garbage and weeds, past the old Michigan Central Terminal, which was once Detroit’s answer to New York’s Grand Central Terminal but which has long since been abandoned; past a onetime Cadillac manufacturing plant that is now an empty lot.

We stopped at an old Ford plant and stood in a stiff, cold wind, reading a plaque put up by the Michigan Historical Commission: “Here at his Highland Park plant, Henry Ford began the mass production of automobiles on a moving assembly line. By 1915 Ford built a million Model T’s. In 1925 over 9,000 were assembled in a single day. Mass production soon moved from here to all phases of American industry and set the pattern of abundance for 20th century living.”

Professor Shaiken’s grandfather, Philip Chapman, took a job at the Highland Park plant in 1914, earning five dollars a day, and worked on production at Ford until his retirement in the mid-1950s.

We’re at a period no less significant to the U.S. than Mr. Chapman’s early years at Ford. We need a revitalized industrial policy, including the creation of whole new industries, if American families are to prosper in the coming decades. If there is any sense of urgency about this in the hearts and minds of our corporate and government leaders, I’ve missed it.

Fix Detroit and we fix what ails America.

Women+Vampires+Cars = New Moon Videos Viewed 400 Million Times (so far)

New Moon might go down as one of the biggest movies of the year, but it’s also quickly becoming one of the biggest online events ever, at least in the world of online video.

Visible Measures, which tallies what it calls the “True Reach” of an online video (the original, official trailers, copies of the trailers, fan-made trailers, fan commentary, etc.), now reports that New Moon is the second biggest event of all-time, trailing only the omnipotent Soulja Boy in term of total views. In all, the firm estimates that New Moon inspired videos have now been viewed in excess of 400 million times.

“New Moon” is blazing a trail for a new model of paid content distribution.

10 CRUCIAL CONSUMER TRENDS FOR 2010 : Trendwatching

I have been working on the Top Digital Trends for 2010, which I will publish on Threeminds just after Thanksgiving. In the meantime, here are the Top 10 Consumer Trends for 2010 from Trendwatching.


BUSINESS AS UNUSUAL  Forget the recession: the societal changes that will dominate 2010 were set in motion way before we temporarily stared into the abyss. More »

URBANY  Urban culture is the culture. Extreme urbanization, in 2010, 2011, 2012 and far beyond will lead to more sophisticated and demanding consumers around the world. More »

REAL-TIME REVIEWS  Whatever it is you’re selling or launching in 2010, it will be reviewed ‘en masse’, live, 24/7. More »

(F)LUXURY Closely tied to what constitutes status (which is becoming more fragmented), luxury will be whatever consumers want it to be over the next 12 months. More »

MASS-MINGLING  Online lifestyles are fueling and encouraging ‘real world’ meet-ups like there’s no tomorrow, shattering all cliches and predictions about a desk-bound, virtual, isolated future. More »

ECO-EASY  To really reach some meaningful sustainability goals in 2010, corporations and governments will have to forcefully make it ‘easy’ for consumers to be more green, by restricting the alternatives. More »

TRACKING & ALERTING  Tracking and alerting are the new search, and 2010 will see countless new INFOLUST services that will help consumers expand their web of control. More »

EMBEDDED GENEROUSITY  Next year, generosity as a trend will adapt to the zeitgeist, leading to more pragmatic and collaborative donation services for consumers. More »

PROFILE MYNING With hundreds of millions of consumers now nurturing some sort of online profile, 2010 will be a good year to introduce some services to help them make the most of it (financially), from intention-based models to digital afterlife services. More »

MATURIALISM  2010 will be even more opinionated, risqué, outspoken, if not ‘raw’ than 2009; you can thank the anything-goes online world for that. Will your brand be as daring? More »


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