Most Expensive

There is a real dichotomy emerging in most consumer markets. Ultra cheap and ultra expensive. Although it’s fair to assume that something that is 3 times the usual price should have three times the utility, chances are things aren’t so symmetrical.

In real estate a house that is twice the price is often 4 times the size and far more than twice as good. However in consumer goods, something that is 3 times more expensive, might only be 50% better.

Maybe the fact that it is the ‘most expensive’, justifies the price. The price becomes the defining feature.

Bugaboo pram

A great example of this is the Bugaboo Pram. I am sure they are better than the average pram, but how much more effective are they in real terms? Are we really going ‘off road’ with our bundle of joy? Or do we want to advertise to the world that we have spent as much as possible on a pram for our child?

Trust

Today I remembered why brands like Kraft, Nestle, Heinz, Kleenex et al have done so well. It’s because they were trusted. Trusted to deliver a remarkable product experience. The problem is, that what was, remarkable in 1963 is no longer remarkable in 2007.

Their trust was built on being safe, reliable, to have function and form. We wanted to feel confident that our cheese slice was safe to eat, hermitically sealed, made with quality milk, that the factory was clean. But now, that’s just table stakes. Cost of entry. The government has created laws which raise the stakes for remarkable products. This is a good thing. Raised standards on all things makes life better, but it does make entrepreneurship harder.

The problem is that trust has been abused by yesterdays’ heroes. Their products are still safe, but they took out all the good bits to make it profitable. Kraft Singles have reduced the cheese in them to the point that they are officially known as ‘Cheese Spread’ – check the label.  

Trust is great, but if we abuse it, we leave the door open for those who are authentic.

Revenue

A question: “Have you ever started a small business?”

What will define our answers?

  • The fact that we had an ideas journal?

  • The fact that we typed up a small business plan?

  • The fact that we even looked at some costings to pull it together?

  • The fact that…

We need to define success in launching a business the same way the tax department does, when we have got revenue.

Until this time, all we’ve done is flirt with theory. We must do to become.

Eyeball Time

Some things are just nice to look at. They demand eyeball time, so we investigate further.

sanpellegrino.jpg        

What does your website, bottle, office, church, uniform, gadget look like?

Be a Surfer

The art of surfing is far more complex and considered than one might imagine. It’s much like Entrepreneurship. The perfect wave is different for different surfers. But some principals never change.

 

As a surfer you’re constantly assessing the situation. Before, during and after the session. But before you enter the ocean some decisions must be made.

 

Stevie in Maldives

Crowds – Smart surfers avoid crowded conditions. Even if the waves are perfect. You’re better off a little further down the beach where the waves are smaller but, at least you’ll catch a few.

Market Size – When you’re learning to surf, you don’t paddle out into the biggest waves you can find. You learn in the small stuff where conditions are more gentle and forgiving.

Investment – When learning there’s no point spending large sums of money on the latest equipment. You go to a garage sale. You pull together some stuff to do it – cheap. You might not enjoy it.

Market Entry – Before you paddle out you assess the best way to reach the line up of waves. It’s best to avoid the dumpers. They’re hard to push through. You’re much better off on the edge of the waves and letting the rip pull you out. Use the momentum of the ocean. Don’t paddle against it.

Positioning – You also need to know where to sit in the line up. Where to position yourself amongst the other surfers. Not too close, or you’ll both be fighting over the same waves. This is only relevant if there are other surfers in the water. Hmmm, I’ve got an idea…

Niche Market – Number one rule of surfing. If you find a secret spot with plenty of waves and no crowds, don’t tell anyone.

Experience – Know your limitations. It’s fine to get into the big stuff. But you have to be aware of the risk of drowning.

Incumbents – Locals can be very protective of their waves. It’s often better to surf in locations you know well and have the respect of others.

Preparation – It’s good to know how to swim before you even attempt surfing.

The Ride– Surfing is about radical moves, risk taking. The glory and ultimate rush doesn’t come from riding a wave in a straight line to the shore. How boring.

Exit Strategy – When you’re surfing on a reef or rocky point, you need to know where to exit. Sometimes you can’t exit a surf spot the way you entered. The tide might be low and the reef will cut you up.

Changing Winds – A good surfer can read the changing conditions, and know when to catch a wave in and be satisfied with what was achieved.

Be a surfer.

A Picture Tells…

Below is a photo of the first Apple computer – the Apple 1.

 Apple 1

Wood. I didn’t expect this either. Some classic bootstrapping by Wozniak in 1976. Radical logo here too!

No product benchmarks? Truth is, other PC’s like the Datapoint 2200 and the Xerox Alto were selling up to 6 years earlier. These didn’t have wooden cases. They weren’t built with second hand parts.

Doing gives you the opportunity to enhance later. Perfecting and planning opens the gate to nimble entrepreneurs. Innovation is quite forgiving.

A great example of driving for success over perfection

Launch now, improve later.

Theatre at Transaction

In a recent blog entry “4”  I described my version of must haves for any start up opportunity. One of these was was Theatre At Transction. While wondering through Melbourne I came across a perfect example. The store is called KoKo Black. 

They have been written up previously on Springwise. This small firm knows the leverage of the theatre.

At 11am on a Saturday morning there were more than 20 people watching a brand being built, literally. By the time I got my camera out the crowd had dissipated . But you can see the concept. Koko Black have managed to do what Cadbury couldn’t conceptualise.

choclate making  

They only do chocolate. That’s it. But they are the experts. Classic single minded proposition. All five senses in action at retail level. Eat in or takeaway. Breakfast lunch and dinner, chocolate is the only thing on the menu. Their retail concept is very clever. They have a viewing bay where you can watch the gourmet chocolatiers in action. After all old is the new new. The emotional connection is made in a way that can’t be done with TVC’s and interuption marketing.

The net result is a price of beyond $100 a kilo. While old world cadbuary languages at $12 per kg. Who do you think will profit in this category in the future,  the specialists or Mr Glass and a Half? In an obese world, the treat from the specialist will win every time.

If you’re in Melbourne go and check them out in the City, Carlton or Chadstone. A lot of great learnings for any entrepreneur.