Small Companies vs Big Companies

If I could give one piece of advice for anyone who has reently escaped their cubicle of the large corporate scene to start up it would be this:

Do the opposite of whatever large companies do.

…and be quicker than they are.

if your startup is in the same industry you worked in…

Do the opposite of what you ‘were told to do’ within your large company.

To beat them you must focus on momentum. We most not do what they do, we must not compete on their level.

To gain momentum, we simply cannot behave the way they do.

Qantas gets it wrong with Effiency

These 3 photos where taken at Melbourne airport on a Friday night.

This is of a quick check (self check in terminal)of which there are 22.

This is of the the bag check in staff of which there were 3 working. (They have spaces for 22 employees)

And the this photo is of the ensuing crowd and chaos.

(the crowd goes around the corner it’s at least 100 deep)

I asked the staff member if she’d like some help tonight – she seemed flustered with how busy she was. She said “of course, but it’s ‘cheaper’ this way”. Then I asked if she thought “quick check” was quicker. She said “definitely not”.

So here’s the thing – Qantas make money out of the quick check. The save on overheads. On the balance sheet it makes sense. But what is the ‘real cost’ of doing it?

What it does is, is actually diminish what they actually provide at a differentiated level. It reduces their product from “service” to “travel”. They further commodify themselves against their low cost airline competitors. They make us ask why we are actually flying qantas and paying a premium…

– Is it the food service? – Not likely, given the food is most often a gourmet cookie & juice.

– Is it the service in the air? – Not likely, given their staff are less polite than budget airlines.

– Is it the airplanes? – Not likely, given all domestic players use the exact same aircraft.

– Is the the baggage allowance? – Not likely, given the allownaces are the same 20kg’s to tohers.

– Is it the terminal ambience? – Not likey, given it’s shared with jetstar.

– Is it their safety record? – Not likey given recent scares & that no major aircraft has ever crashed in Australia.

– Is it the inflight entertainment? – Maybe, but it’s a stetch these days given we all have mobile entertainment devices in our pocket.

– Is it the Frequent Flyer points?  Maybe, but it’s marginal at best.

– Is it the Qantas Club? yes – if you are preapred to pay the $775 per annum.

And it can’t be their ground service, given the example above on a Friday night.

Qantas need to ask themselves some hard questions about what they actually offer – as a long time loyal customer, it’s waining quickly. Their point of difference is in a massive state of decline.

Here’s what Qantas ought do if they want to avoid further decline:

  1. Offer Hot meals & drinks every flight. Not just at dinner time. If we are travelling we didn’t have time for dinner or lunch, regardless of when our flight was. We are just as hungry on 7pm flights as we are on 6pm flights. It’s not the food which costs the airline, it’s serving it up. So, if you are going to serve it. Make it worth the effort.
  2. Make the ground experience comfortable and convenient. A few more staff members on the cehckout is a nice start.
  3. Provide free wifi to anyone with a boarding pass.
  4. Have a ‘no tricks’ Frequent Flyer program where any seat on any flight is available, and not for ‘extra points’ – we’ve already paid a premium for our tickets – remember Mr Qantas?
  5. Have separate terminals for your Budget Airline (Jetstar) and your Premium Airline (Qantas).
  6. Sing out loud in your advertising about how different the Qantas experience is. Make us feel special.
  7. Charge the price needed to make it profitable. You’ll be surpirsed how many of us will be preapred to pay for it.

It’s about time Qantas started to focus on it’s customers and forgot about it’s competitors. Eventually we all morph into what we focus.

I’m sure Qantas will tell us this isn’t possible – but tell that to the person who pays twice the price for a Mac book pro versus a Toshiba with the same configurations.

Startups out there: “Beat your competitors – don’t be them!”

Quirky fact: Boring = Profitable

Unless you are from the US – you have never even heard of any of the 10 oldest businesses in the USA. Nope, not one. There’s not a sexy brand among them. They include boring industries like, banking, ingredients, manufacturing inputs and insurance.

You can check it out by clicking here.

The important insight for Start Ups and investors is this:

The boring stuff is almost always more profitable than the sexy.

Why: Because exciting, sexy stuff attracts lot’s of competitors and people want to play there. They want to play there because it’s fun, it’s in the papers, it’s featured in business forums and leverages over-riding social trends. Then it gets busy and the cream disappears – (read here abnormal economic profits) . It’s no different to the house prices rising in popular suburbs and the yield declining. Simple economics discovered centuries ago.

So what? It’s vital we know the difference between sustainable & exciting. The most important factor for survivial is profit – end of story. Sure, profits can be made in any industry, but chances are there’s more profit in the areas everyone else forgot about.

Are you into it?

I’m sure there are examples of people who’ve been successful by simply being good at what they do. But there are more examples of world beaters who are ‘into’ what they do.

I’m into this blog. I love writing it. I did it with as much enthusiasm when 10 people read it each month as I do now when more than 20,000 do.

Some of my favourite entrepreneurs are really into what they do.

Branson loves music & flying.

Trump loves real estate & the deal

Steve Jobs is really into design & aesthetics

Lindsay Fox loves trucks and cars (he even has ‘truck driver’ as the title on his business card!)

Doug Warbrick loves surfing….

Doug and his surfing partner Brian started Ripcurl, the surfing company. They started making surfboards in the late 1960’s and shortly after made some the first surfing wetsuits the world has seen. In fact their first wetsuit was made from a rubber carpet underlay they pulled up from a floor with an old pre world war 2 sewing machine – great bootstrapping. He made the wetsuits so he could endure the harsh Victorian winter and enjoy the best waves of the year down there.

They just kept making really good surfing equipment. Which they also sold, 40 years on Ripcurl is now one of the three dominant companies in the Industry, valued at well over $500 million.

Ripcurl founders & store circa 1970, followed by curent retail outlet

Are you into your job, business or startup, or just passing the days?

The best innovations no less ‘ entrepreneurial success’ comes from people who are really into what they do.

What about your people?

All our startups, businesses and brands have their people. It’s members, it’s customers. The humans that matter in whatever we do. So how do we connect with them? Not talk to them or worse, at them, but how do we really connect with them?

Here’s what we are doing at rentoid. We are having an coffee session in the CBD of melbourne (our home city) where members can come and grab an espresso and simply chat. If only 1 person turns up, that’s fine by us. Because that one person matters as much as the 250,000 others. In fact to them, they are the only person that matters.

The discussion will be whatever the people want it to be about. Not a contrived focus group. What matters is making a connection with them, being a group of people trying to help each other, breaking down the traditional corporate facade. Not having any gatekeepers.  And quite frankly we can’t wait.

If you’re in Melbourne came and meet the rentoid team for a chat and an espresso on us before work. We can chat about startups, marketing, life and maybe even rentoid. We’ll be at Journal in Flinders lane. All the details are here.

When’s the last time you took time out to hang with your people?

Why authenticity works

Any disciple of the new marketing world order will tell you ‘be authentic’. And startup blog couldn’t agree more.

Here’s why: It’s refreshing.

It is so refreshing to hear a person, group of people or a small company tell the truth for once without a hidden agenda. It’s the opposite of what we’ve had for most of the past 50 years. It’s the opposite of what we expect, and usually get.

Net result is a relationship of trust is built. When this new paradigm arrives all sort of cool things can happen.

Like removing the need to advertise.

Like a loyal consumer base.

Like brand evangelists.

Like all the good stuff most large companies dream of having.

Four n twenty – Authenticity Facilitates Radvertising

For non Australian readers Four n twenty is a brand of meat pie, which is very Australian. A brand people know and love.

We also know that meat pies really have no place in the push for health and wellness. Pies are not a ‘healthy’ food. And quite frankly, who cares? All foods can be part of a healthy diet and trying to change your product because people can’t control themselves, does not a strategy make. It’s high time food marketers started to realise this. The so called ‘obseity crisis’ is not their issue.

Under the control of Multinational Food Giant Simplot, Four n twenty lost the ‘plot’. They started launching pathetic line extensions like ‘Low Fat Pies’ – which clearly would never change the perception of a meat pie, let alone get a non pie eater to start eating them. It’s fake and just damages the brand.

Recently the Four n twenty brand was divested from Simplot, to new owners Patties. These guys – who just play in the pastry and pie market have really shown they get it, when it comes to engaging their core target market.

Four n twenty make no apologies for what they are, the product the sell, and who they make it for. It’s authentic marketing. And their authenticity facilitated a great piece of communication.

This spot is Gold. Clearly it is radvertising.

[youtube=http://www.youtube.com/watch?v=CIYC1gLSSq0]

Kudos Four n Twenty.