Previous month:
May 2008
Next month:
July 2008

Keeping it Simple: Airlines show how not to do it.

It's best to be very clear about what your customers gets, what it will cost them (or profit them) and how it is to work with you.   Used to be you could choose an airline by:
1) Comfort level
2) Schedule
3) Price

Aa Not so anymore.   Rather than keeping it simple and raising price or better capacity planning, it now takes a spreadsheet just to figure out how much it really costs.  Here's a list of the hidden charges for US domestic air carriers:

Reservation by phone
Checked bag charge
Getting a good seat
Beverage / Snack
Oversize Bag
Overweight Bag
Non-refundable ticket change fee

And it goes on and on.   Yet Southwest has the cleanest policies, most things are free and is profitable.  Coincidence?   

My advice, keep it simple and over-deliver.   At the end of the day you will not only be more profitable, but have more return customers who will sing your praises.   And tell their friends.

Patents and Intellectual Property

While I'm not an attorney I've been involved in numerous IP deals sitting on both sides of the table.   One of the biggest misconceptions about patents is many people believe having one is an iron clad wall which will protect them from competition.  It just doesn't work that way.   I believe that patents are most useful as a negotiating tool used for licensing deals.

The first hurdle in patents is the extent of the claims.  Many people try to get them to cover everything they could ever think of doing.  The problem with this approach is it's darn hard to prove those claims (e.g.  prior art).  Instead it's best to keep them tight and well defined to your core business.   That way it's much easier to prove and show infringement.   

Other companies like to use them as a club to beat down any perceived competition especially after the fact.   They like to "stretch" the meaning and intimidate others into sending them money.  If you are on the receiving end of this behavior it's best to stand up to them.   Most of the time they will back down before going into full scale litigation because they know they can't win.  But this is a great opportunity to get them to the table and figure out why they are exhibiting this behavior.   Sometimes something good will come of this, but at least you can make them back down.

Years ago we were using a non-Intel chip in a new computer.  We knew there was some bad blood between Intel and the chip maker about a potential infringement of one small portion of the chip.  So our engineers made sure that portion of the chip was never used.  We went to market.  Sure enough our attorneys came back to us saying Intel was going to start litigation and we should settle.   I stated we had done nothing wrong and if they wanted to litigate that would be just fine, we could pay our expenses from the marketing budget: the publicity would be worth it.   The issue died quietly.

So by all means, file those patents, but realize their best use is to promote licensing deals.   But if you are being treated unfairly, get the best legal representation you can afford and stop that behavior as quickly as possible.  You don't want to get the reputation of being an easy target.  And that's in the best interest of your customers and investors.

Trade Show Tips: Part 2

Just returned from a trade show and I have some observations:
1) Suits look a lot better than logo short sleeve shirts.   Let's face it, very few people look good in Aa those shirts.  Sure you might think it's cute that everyone has matching shirts but unless everyone spends a lot of time in the gym.......   And make sure you polish your shoes.

2) If you carry multiple products, group them.  That way you can tell interest by where someone is standing.

3) Movement and color catches the attention.  Have BIG monitors showing continuous motion.  Every 4th or 5th slide, put up a point.   Make sure you have 4 sets of slides in rotation.

4) Keep it clean, keep it simple.  It's better to have fewer things and flow.   

5) Stand back and watch.   Go about 30 feet away from your booth and watch.  See where people tend to go.  See how the staff interacts.   If the staff gets clumpy, break it up.  If you have chairs and tables and the staff spend their time sitting in them, get rid of them.

And finally, you don't always have to be selling.  Trade specific small talk is great.   

Trade Show Tips

It's off to a trade show this weekend and here's a collection of thoughts as you prepare for your trade shows:Aa

1) Vertical specific and regional shows return the best bang for your buck.   Unless you have a gazillion dollar marketing budget avoid the big general purpose shows.  Why?   Because when you are focused on your shows your odds of having interested attendees go way up.

2) Bring lots of business cards.   Make sure that someone looking at your card knows what your company does.  And have it blank on the back side for those hastily scribbled notes.

3) If you're introducing new products bring in the entire field sales team.   Not only do you energize the team, they can start talking about the new products to potential customers right away.  And they'll have questions.  And you're there to answer them.  When they go home, they'll hit the ground running.

4) Simplify your booth.   On your banners be explicit in what you do.  Lose the cute slogans.   Make sure other banners can be used as a selling tool.  Instead of handing out glossy brochures (which get tossed in the trash), point to a banner and walk a customer through your product.

5) Embrace the Brownian motion.  Don't over schedule your time.  Walk around, see what other vendors are offering, talk to random strangers.   Otherwise, why did you come if not to learn and connect?

6) The 48 hour rule.   If you made a commitment at the show, make sure you follow through within 48 hours after the show.   Interest decays rapidly with a very short half life.  And you need to demonstrate commitment to build relationships.  And this is an easy place to start.

And finally:
7) Just because you have a show list of all attendees does not give you the right to spam their email inboxes.   And if you do call someone who was at the show and you did not meet, make sure there is a single point of contact.   Nothing makes a company look more foolish than three different people communicating with the same potential customer.    With the CRM systems available out there for free, there is simply no excuse.

Push Sales: Does it work for you?

I worked at two companies where senior management believes that sales is nothing but a numbers game.  I'm sure you've heard this logic before "If I call x people, I'll get y meetings and close z% of them".   That's push sales.  Closely related to cold calls (which I despise). Aa Oh and if you cold call me, quit pretending you're my next best friend.   Just tell me what you're peddling.   (I hang up on a lot of people, I must be in the negative x group).

Instead focus your attention on credibility and relationships.   Who endorses you?   That's powerful stuff, be it trade groups or customers.   Be seen where you customers hang out.    Then be known as the helpful person.   That will increase your sales.

Case in point.  I once worked that logic at a company and closed $1M in sales.  But it wasn't growing the company fast enough (I agree).   So instead of figuring out how to do more of that kind of business by stepping up credibility and relations, the company decided to bring on a 4 person push sales team and eliminate marketing efforts.  In six months they've done less than $50K in total sales.   Whoops.

This is why marketing is so important.  You need both sales mentality and marketing mentality.  Ignore one side or the other at your own peril.