What I always tell door to door sales people might surprise you

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Whenever a door knocker comes to my home to sell me something I probably don’t need, or already have – like electricity, I always tell them the same thing:

Congratulations – you’re going to be rich!

Yep, I give them praise for what they are doing (one of the most difficult jobs there is). I then go onto tell them about how the skills they are gathering will give them a massive life advantage in any developed economy. I remind them what these skills include:

  • Dealing with rejection. (Yes, I politely tell them I am not going to buy upfront)
  • Learning how to sell to a stranger.
  • Learning to sell products which are homogenous, boring, commodities & even unwanted.
  • Learning how to talk and pitch – their pitch time is at most a few seconds.
  • Understanding body language.
  • The power of persistence.
  • How much courage they have and their willingness to work (I’m guessing it’s job you only take out of desperation)

There’s more but you get the picture.

Most often they are pleased I’ve noticed this, and sometimes the hardworking sales person doesn’t even realise what a terrific opportunity this ‘horrible job’ turned out to be. I tell them it only gets easier from here. And if we happen to get into a conversation I give them some tips on selling, recommended some great sales trainers they can listen to; like Brian Tracy and Jim Rohn, and even some books worth reading. Lastly I explain to them that all CEO’s simply have to be Sales Rain Makers.

Even when we choose not to buy, we can still create some value for the seller.

New Book – The Great Fragmentation – out now.

Ignore what the teacher told you, and just make things up

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Watch a 5 year old kid play for half a day and you’ll see levels of creativity that’ll blow your mind. You’ll wonder in awe where their natural ability to ‘make things up’ comes from. You’ll be inspired by how they see the world and what it makes them think and do.

We used to see the world that way too.  But what happened was for the first 18 years of our lives we got told how to see the world. In fact, the concept of making things up brings back some very strong and personal memories for me. I can remember when I reached High School (Grade 7-12 in Australia) and that it was no longer Ok to make things up. We had to reference where we got our ideas from. All of a sudden my opinion didn’t matter. What started to matter was researching someone else’s opinion, someone who had been ordained by industrialised society and had been published. It felt so weird. Why couldn’t I just write what I think? Why did it have to be a quotation from someone else? Why did what they think matter more than what I think? We all got taught  got taught stop thinking and start rehearsing. Rehearsing for what you may ask?

Rehearsing the lines for some kind of monetary industrial pantomime.

We were getting taught how to play inside the the modern economy.  An elongated economic play in which we would become ‘extras’ in someone else’s dreamscape. Someone else had the starring role, but they needed all sorts of support so they could be the stars of the show. And we went along with it. But now the exact opposite of what we got told, is where all the value is being created.

The trick they pulled on us to not have any original ideas, to not create anything new, to keep our opinion to ourselves is rapidly becoming redundant. And this gets me excited. We all still have the ability to just ‘make things up’. Now that we have access to the tools to create anything, now that the economy is being totally redesigned, we just need to forget what we got told, and start to write some of our own lines.

New Book – The Great Fragmentation – out now.

How toilet paper weirdly tells a story of industrial disruption

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If you’ve been wondering recently why you use so much toilet paper. Why it seems every year you’re buying more rolls than ever before. Wonder no more. As a bonus you’ll also find out with a weird example how so many industrial companies sow the seeds of their own disruption.

The first every job I held with a big company after graduating was with Kimberly Clark. An American multinational paper goods manufacturer. A big brand of theirs is Kleenex. The market leading toilet paper which we now buy giant packs of up to 24 rolls. But it wasn’t always this way. When I started working there more than 20 years ago the best selling package size of toilet paper was a 4 pack. Did we all of a sudden start going to the toilet more frequently to require more toilet paper? If not, then how is it that most families could survive on a 4 or 6 roll pack from the weekly shop and now we need to purchase to a 24 roll pack?

Here’s how:

When I started working at Kimberly Clark most toilet rolls had between 300 and 500 sheets (paper squares) per roll. Some brands had up to 1000 sheets per roll. But what I discovered as a few years went by is that instead of raising the price, the company would simply remove 10 or 20 sheets per year. They did this as they believed that consumers are more sensitive about price than quantity. It’s a popular fast moving consumer goods ‘pricing‘ tactic to maintain profitability without changing the selling price. Kleenex Cottonelle is now down to 180 sheets per roll. In addition to this Kleenex Cottonelle is 1 ply, and the Kleenex brand it replaced was 2 ply. Some toilet papers are down to 100 sheets per roll. They even increase the size of the core of the roll to keep the same perceived roll width. So there is your answer. Each roll we buy these days has far less paper on it. Often by a factors of 4, 6 and even 10. This is why we need to buy packs which are 4x times the size. But the paper companies got what they wanted, they kept their prices per roll roughly the same.

But this goes deeper than a story of bathroom anthropology. It tells the story of how many large legacy companies are coming undone. It’s a story of their industrial mindset. And that mindset is as follows: They’d rather give their customers less for the same price than be transparent. In fact, it’s exactly what industrialists do, they want to get more for less, every single year. But in a strange kind of reversal, they end up costing themselves more and giving themselves less. Their cost per roll in distribution, and packaging goes up. And their cost per tonne of what they sell in retail margins increases. And it is of course a race to the bottom. A brand can only cut product delivery so far until the product is no longer. It also creates a worse product experience for the end consumer. I know I don’t want to carry home toilet paper packs four times the size in my trolly or buy it 4 times as frequently.

Above all of that, it shows where the focus is for these companies: On selling stuff they already sell, as cheaply as possible, using the machines they’ve already got, with a short term focus. At no point is the end user considered, or part of a strategy which doesn’t involve trickery. They have a mindset of scarcity, not abundance. On the flip side we have many startups and technology companies focused on giving more for less, and creating platforms for consumer creation and collaboration. It’s no wonder half of the the Fortune 500 lost their invitations to the party in the past 10 years.

New Book – The Great Fragmentation – out now.

The best single lesson Bill Gates gave every startup & product manager

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The worlds richest man, Bill Gates, did something important all those years ago when he lead the personal computing revolution. He didn’t let perfection get in the way of success. In fact, he became the worlds richest man by selling a product which in many ways was well, suboptimal. His software crashed so often it was just a normal part of the product usage experience. And we accepted the situation for one simple reason: it was better than the alternatives. It was better than doing the work manually. It enabled us to create malleable work. It enabled us share information electronically. At the time this was such a shift forward in communication, the imperfections, the problems, the crashes and other stuff Microsoft became famous for still made it better than the substitutes.

This story makes clear two points when it comes to product strategy:

  1. Users will tolerate imperfect products that provide significant utility jumps over what they are currently using. Think game changers – Tesla short mileage range comes to mind.
  2. If the product is a ‘me too’ offer, then the only thing that will create success is the exact opposite: Seamless user experience, beauty, stability and reliability. The hassle of switching must be worth the effort. Instagram comes to mind.

If our startup is introducing people to a much better option, we need to move quick and fill the void, even if it has known imperfections. We shouldn’t be afraid of making it better later, once it’s already in market. But if, we are entering an established game, we better be sure it’s not full of bugs. But sometimes the hardest thing to do is not fool ourselves as to which category we are actually playing in.

New Book – The Great Fragmentation – out now.

The first question early stage startups should ask themselves

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When we being our journey into a new startup we get excited by the possibilities of what we are about to build. Especially when it comes to raising capital to support the project. But in the moment there’s one question we should not forget to ask ourselves:

Is this a technology push or a problem pull?

The answer to this question changes the direction of the entire project. It changes who will care about what we are building. If making money is the objective, it makes more sense to be in the problem pull space. If you want to change the world, Peter Thiel or Peter Diamandis style, then it pays to be in the technology push arena. Both can become commercial success stories, and one isn’t superior to other, it just depends on what we are chasing – it’s really about the ‘Why?’ The thing that really matters is not confusing which of the two our startup plays in and ensuring our expectations match the funding, timeline and outcome realities.

New Book – The Great Fragmentation – out now.

Learn why data matters with one simple photo

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If I was to ask you what the kids in the above picture were doing – beyond burying their faces in their smart phones, there is an almost infinite number of possible answers:

Messaging a friend, Face-timing their mum, Commenting on a blog, Snapchatting, Booking a flight, Submitting their homework, Buying a pair of sneakers, Updating their FB status, Getting directions, Sending a friend some money, Finding a cafe for lunch…. they might even be talking to directly to each other. The point is we don’t know. We can’t know by observing behaviour from the outside. Instead we need to get inside the data to find out what is actually going on.

This is a big shift in marketing and business in general. We can’t simply observe, we can’t just ask, we’ve got to mine. And while this movement might have started with the smart phone, we’re now entering an era of general purpose machinery and computing. End products which change their purpose based on who is using the technology. Malleable products like 3D printers and self drive cars will mean the only way to know what’s really going on is to match usage and observation with data. Increasingly this will need to involve collaboration, and the effective way to do that won’t be just taking the data without asking, or tricking people with hidden terms and conditions, but collaborating with it. In order to do this we need to develop a trusted relationship where we share the marketing process with our users just as if they are part of our internal team. If we do this, we can bake a bigger revenue pie where we all get a piece.

New Book – The Great Fragmentation – out now. 

You were born to pitch

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Pitching is one of those things that some of us love and and some of us hate. But, we all know it is a necessary part of startups and economic life in general. Here’s something many people don’t know – everyone is good at pitching, everyone is doing it everyday, and in fact, it was the very first thing we did the moment we were born. Yep, the first thing you did as a human being was pitch. Here’s how it went:

You were born into the world scared and alone as you exited the womb. You desperately wanted to stay alive, and immediately went into pitch mode. You cried for your mother to hold you, cuddle and warm you, to provide your first taste of breast milk. You put on your most adorable sad face, and used the only assets you had at your disposal – facial expressions and noise. You didn’t even have any words, but you made an immediate connection through passion and fear and hope – you connected. And it worked – you are here.

It goes further than that. You probably pitched a few times already today – proposing what to have for dinner, which movie to watch with your partner, or what to do on the weekend. You may have pitched to a work colleague on which place to get a coffee in the morning or what time to go and why. Proposing ideas, suggesting activities, it’s all a manner of pitching. And once we start to pay attention to the fact we are constantly pitching, then we can start to understand our own technique and bring it into the more formal circumstances. The best type of pitching we can do, is to bring our casual daily approach – the same approach that helped us survive in life up until now – into our business life. We need to take our natural style into those formal pitch moments. When we do this we become more endearing, believable and affable. The trick is that we need to be our natural selves. We need to embrace our natural style and personality – that same one that helped you make friends.

If you want to learn to pitch, then the best thing you can do is pay attention to the pitches you’re already doing. Take note of yourself and then take your existing informal method  to places where it matters formally. You’re already a gun pitcher, you just need bring your subconscious behaviour to a conscious level.