McDonald’s May Be Getting It

lovinitBack in the early days of McDonald’s and In n Out Burger, both stores offered hamburgers, french fries, soft drinks and milk shakes. McDonald’s had the word Hamburger on its signs (no longer) and they were focused. Over the decades McDonald’s has added 100s of items to their menus and In n Out Burger still sells hamburgers, french fries, soft drinks and milk shakes.

Despite the materially larger menu, McDonald’s does about the same revenue per store as does In n Out, and In n Out is rated one of the top fast food restaurants, while McDonald’s ranks near the bottom.

While it’s still only a drop in the bucket, McDonald’s new CEO is trying to regain focus at the chain. To that end they are dropping several items from the menu.

There is no company that cannot improve its performance by narrowing its focus.

Mitch

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Direct mail works

tvguidedirectmailAs the volume of mail sent via the USPS diminishes, the opportunity to productively use direct mail (snail mail) effectively increases because the amount of clutter goes down. As an advocate of direct marketing methods for more than 20 years, I am on the watch for new ideas.

Getting your mail opened is always a top challenge. Over the years various techniques have been found to be effective. The one pictured above is new to me and seems pretty clever. It was designed for an offer for TV Guide and on inspection one finds that if one does not renew, one will have to pay a higher rate at the newsstand for one’s copies.

A truth about direct mail is that if something works, it will be used again. And if it doesn’t it won’t. I will keep my eyes open to see if others use this technique to get their mail opened.

Mitch

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Technology is Still Amazing

I have been in the technology world since leaving college in 1973. I have been directly and indirectly involved in launching several new to the market products, and have observed many others. And what technology can do still amazes me.

The latest “amazement” is from Liftware. They have found an economic way to create a spoon that cancels the tremors in the hands of patients experiencing tremors, such as those with Parkinson’s disease.

Check it out.

Mitch

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Own a Position

RiedelMany companies make wine glasses. A quick search of Amazon finds thousands of results. Most, like in any category, are apparent commodities and are priced accordingly. And then there is Riedel. Ranging from about $25/glass to well over $100/glass, Riedel makes wine glasses for specific wines. After all, if you’re serious about your wine, would you not want a glass to match?

This company is an excellent example of “finding a need and filling it.” And well I might add. They show that if you can understand What your customer is trying to buy, and can deliver on it, price matters much less than many would have you believe.

If you want to get higher prices than your competitors, be perceived as different from them. What can they buy from you they don’t think they can buy from anyone else? And how much is that worth to them?

Mitch

 

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Strategic Execution: Getting The Right Things Done

chessIn his book, The 8th Habit, Steven Covey notes that only about 33% of employees know where the company is going (or at least trying to go); 22% can connect the dots between their goals and the company’s goals; and then (big surprise … NOT) only 9% are highly energized and committed.

Why is turning strategic plans into action such a difficult problem? The age-old axiom that strategic plans end up on the shelf or in a drawer continues unabated. And it doesn’t have to be that way. There is a very simple process that aligns goals with actions thru strategy. We call it Strategic Execution.

Take a read if you are so inclined, it’s free and without obligation. Feedback after the read is welcomed as well.

Mitch

 

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Marketing Operations: Foundational or Supportive?

My friend Gary Katz, posed the question that is the title of this post recently. He then posited this answer:

Marketing’s foundation comes from understanding your target market, how they buy and matching how they buy with your solutions, messaging and delivery. It is based on understanding the customer’s needs and how one’s company fulfills those needs effectively. Marketing operations is the facilitator that helps marketing and sales understand if you are accomplishing that mission, how you are doing it, how fast you are doing it and if everything you are doing is working: Providing the foundation of effective, efficient marketing.

I agree with much of what he said except one word: “the” facilitator rather than “a” facilitator. I appreciate that Marketing Operations is working hard to gain respect and value, both of which it deserves. But it is a tool used by Marketing to do a better job.

He also notes that Marketing must understand “your target market, how they buy and matching how they buy with your solutions, messaging and delivery.” This is accurate and insufficient to describe Marketing. It is correct regarding current offerings, but as I wrote in my post last week, Kotler noted that the real leverage in Marketing is before the product is released.

Thus, as we say, Marketing’s job is to align the capabilities of the company with the current and future needs of its customers. Marketing Operations may be helpful in the front-end as well, but it’s the insights needed to truly understand where your customer is going that makes Marketing great.

So, I say “supportive,” and significantly so.

Mitch

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Compromise Is Not Win-Win; And Split The Difference Isn’t “Fair”

Compromise is not a win-win, it is in fact a lose-lose. You give up something you want in exchange for the other side giving up something they want. Often compromise is necessary at the end of a negotiation to make a “deal.” However, it should rarely be used at the beginning.

Further Split The Difference is not necessarily fair, though most Americans think it is, and experienced negotiators will use it as a tactic to get the outcome they want. I was reminded of both of these tactics when talking with a friend who had just finished a six figure renovation of their house. I am certain the owner of the firm that did they work wanted to make a profit (which he did ) and have an outstanding reference, which he would have had it not been for $100.

This firm, like many firms has many employees who fulfill customers’ needs, wants and demands on behalf of the firm. Owners of firms are less involved in specific customer issues as the firm gets bigger. The question is what metrics are the owner using to measure and then manage his/her employees. In too many situations the metric is $ and lack of a complaint to the owner signifies everything is ok. Not true. Most Americans, even in this day of Yelp and other online reviews don’t complain. They just don’t recommend.

On this particular project a $2,700 item went awry (the actual cost to fix it was unknown at the time). Both the customer and the contractor shared blame. The contractor’s employee asked my friend what he felt was fair. He outlined that he felt a 2/3-1/3 split was fair and why. The contractor’s employee agreed. When the final bill arrived for this “fix” the contractor’s employee asked my friend how to share the bill. Using the same logic that produced the 2/3-1/3 suggestion he suggested he pay $900.

The employee then noted that some of the cost was due to a change requested by my friend that increased the replacement cost, also there was labor and materials involved, which was understood from the beginning. The employee suggested by friend pay $1,100. My friend said he agreed he should pay for the increased cost and 1/3 of the rest. This meant my friend would pay $970. The employee said how about $1,070. As my friend never considered this a “negotiation” (though everything is), he simply said sure. However, he does not feel it was fair, but isn’t going to fight over $100.

The employee will be able to show her boss that she recovered more that the $900 originally planned, which will make her look good. The problem is, neither of them know the cost was the loss of a raving fan. He still will recommend them, just not as enthusiastically.

What get’s measured gets managed. Are you measuring what you should or just what is easiest to measure?

Mitch

Posted in customer loyalty, management, Negotiation | Tagged , , , , | Leave a comment