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Monday, April 26, 2010

Where will your next great marketing idea come from?

by Matt Heinz

Where will your next great marketing idea come from?Here's an idea.

Pick 5-8 people in your organization who are not in sales or marketing. Invite them to a one-hour meeting later this week, and at the meeting spend 15 minutes each brainstorming on the four questions below:

  1. How will you identify and empower your most loyal customers to tell your story, increase positive word-of-mouth and general referrals?

  2. What can employees do to evangelize your brand, and attract both new customers and potential new employees, on and off work hours?

  3. How could you identify, engage and participate in customer communities to build value, trust, credibility and consideration/intent towards your brand?

  4. What simple things can you do to inspire greater retention, renewals or frequency with current customers (without spending additional money)?

I bet you'll be pleasantly surprised how creative, innovative and useful their ideas and that time will be.

Bonus points if you hand them a copy of the questions afterward, give them a day or two to think more about it, then reconvene the group for a follow-up session to discuss additional ideas.

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Matt HeinzMatt Heinz is principal at Heinz Marketing, a sales & marketing consulting firm helping businesses increase customers and revenue. Contact Matt at matt@heinzmarketing.com or visit www.heinzmarketing.com.

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Wednesday, April 21, 2010

Storytelling in Social Media

TEDx Seattle Interview with Elan Lee, Founder of Fourth Wall Studios

by Braden Kelley

I had the opportunity to interview Elan Lee, Founder and Chief Designer at Fourth Wall Studios, at TEDx Seattle recently. In this video Elan talks about the future of storytelling and the importance of storytelling to conveying information to others about your new ideas or innovations.

Some of you may be familiar with Elan Lee's work on the alternate reality game "Year Zero" for the promotion of Nine Inch Nail's "Year Zero" album. This project won a Cannes Lion Grand Prix award and a Clio Award (Bronze). Here is an excerpt from the "Promotion" section of the "Year Zero" album's Wikipedia entry:

In an interview with Kerrang! magazine, Reznor hinted that the album was "part of a bigger picture of a number of things I'm working on".[3] In February 2007 fans discovered that a new Nine Inch Nails tour t-shirt contained highlighted letters that spelled out the words "I am trying to believe".[2] This phrase was registered as a website URL, and soon several related websites were also discovered in the IP range, all describing a dystopian vision of the fictional "year 0000".[2] It was later reported that 42 Entertainment had created these websites to promote Year Zero as part of an alternate reality game.[8]

The Year Zero story takes place in the United States in the year 2022; or "Year 0" according to the American government, being the year that America was reborn. The United States has suffered several major terrorist attacks, and in response the government has seized absolute control on the country and reverted to a Christian fundamentalist theocracy. The government maintains control of the populace through institutions such as the Bureau of Morality and the First Evangelical Church of Plano, as well as increased surveillance and the secret drugging of tap water with a mild sedative. In response to the increasing oppression of the government, several corporate, government, and subversive websites were transported back in time to the present by a group of scientists working clandestinely against the authoritarian government. The websites-from-the-future were sent to the year 2007 to warn the American people of the impending dystopian future and to prevent it from ever forming in the first place.[9]

The Year Zero game consisted of series of websites, phone numbers, e-mails, videos, MP3s, murals, and other media that expanded upon the fictional storyline of the album. Each new piece of media contained various hints and clues to discover the next, relying on fan participation to discover each new facet of the expanding game. Rolling Stone described the fan involvement in this promotion as the "marketing team's dream".[10] Reznor, however, argued that "marketing" was an inaccurate description of the game, and that it was "not some kind of gimmick to get you to buy a record - it IS the art form".[11]

This gives you a good idea of the type of storytelling that Elan Lee does. For more of the story about how the "Year Zero" game played out, see the rest of the "Promotion" section of the Wikipedia entry on the album.

I would love to hear your thoughts about how storytelling will evolve as an art form as the internet and mobile devices gain new capabilities. Sound off in the comments!

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Braden KelleyBraden Kelley is the editor of Blogging Innovation and founder of Business Strategy Innovation, a consultancy focusing on innovation and marketing strategy. Braden is also @innovate on Twitter.

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Saturday, April 17, 2010

Wal-Mart's (Latest) Identity Crisis

by Steve McKee

Wal-Mart's (Latest) Identity CrisisWal-Mart is a study in contrasts.

Its low prices are awesome. Its shopping experience, not so much. Its positioning is terrific, but its advertising leaves something to be desired. It serves well its paycheck-to-paycheck customers, but panders too much to the politically correct.

Wal-Mart has a rock-solid heritage in founder Sam Walton, but too often loses sight of what makes it special. The latest example came in the form of an announcement last week that the company was cutting prices on some 10,000 items. With any other retailer that would be cause for celebration, but with Wal-Mart it's just disappointing.

Wal-Mart = Low Prices. Period. Not margins. Not promotions. Not rollbacks. If prices are always as low as possible - as Wal-Mart has worked so hard for so long to convince us of - how then can they be cut, especially across such a wide swath of products? In one of its "rollback" TV commercials, Mike the truck driver says, "just by driving smarter routes and making sure our trailers are packed fuller, we save millions of dollars on fuel costs." Does the world's leanest company expect us to believe that it just figured that one out?

In an April 9 story about the price cuts, the Wall Street Journal's Miguel Bustillo and Timothy W. Martin cited a J.P. Morgan analyst whose regular Wal-Mart price survey resulted in a bill 2.3% higher than it was in the previous month. That's a pretty big jump. While it's any company's prerogative to raise or lower its prices, Bustillo and Martin wondered "...whether Wal-Mart is committed to pushing the envelope on pricing as it did in the days of its late founder, Sam Walton, or is it merely hyping promotions as it pursues a more margin-driven approach?"

Judging from what Wal-Mart CMO Stephen Quinn said of the cuts, it appears to be the latter: "We felt we needed to increase the intensity and excitement with our customer, especially the feeling that Wal-Mart has great deals."

Yuck. "Great deals," "hyping promotions" and "a more margin-driven approach" are what you'd expect from Kroger or Macy's, not Wal-Mart. I don't know about you, but I expect the "great deals" at Wal-Mart to be baked into its everyday low prices, not used as underpinnings of a grand promotion.

Like many companies trying to cope with slowing sales, Wal-Mart can be its own worst enemy. Instead of fiddling with margins and flirting with upscale customers, Wal-Mart should aggressively tout its all-the-time, every-day, low-low-lowest prices. Always. It's the one company with the credibility to do so, and promotions like this threaten that very crediblity. Wal-Mart needs its customers to believe that it always - always - gives them the lowest prices it can.

That's what made Wal-Mart, Wal-Mart. It shouldn't mess with success.

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Steve McKeeSteve McKee is a BusinessWeek.com columnist, marketing consultant, and author of "When Growth Stalls: How it Happens, Why You're Stuck, and What To Do About It." Learn more about him at www.WhenGrowthStalls.com and at http://twitter.com/whengrowthstall.

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Your Personal Brand

Is it mainly personal or brand? Or both?

by Mike Brown

Your Personal BrandFollowing-up yesterday's article that started out as a Twitter DM conversation, today's does too. Kate Wilson and I got into a discussion about maintaining multiple Twitter identities for different content streams.

As my personal branding has evolved, I've switched my Twitter focus from @mikebrown to @Brainzooming. Why? When I first signed up for Twitter, the Brainzooming name was still 7 months from popping into my head. Beyond these two names, I have a couple of related ones for live tweeting, and another active account (along with a corresponding humor blog) that's not affiliated with my name or the Brainzooming brand.

Kate's point was you shouldn't need multiple Twitter identities. Instead, she recommends letting your full personality come through in a single identity. People will either accept your full range of messages and personality or not; you ultimately stick with the 'takers' and drop the 'leavers'. She commented that first and foremost, personal branding is about the person, and you shouldn't need a strategy on how to be a person.

Her last comment really hit on the fundamental difference we have on this topic. To me a personal brand is equal parts person and brand. From that, it's only natural you'd apply brand strategy principles to how you carry out your personal brand. This opens the door to multiple personal brands with different promises, attributes, and affiliations to your main brand. Some people have one audience; others have more than one audience. In that case, it doesn't make sense to think that each audience wants exactly the same things from your brand.

Kate's point of view forced me to grapple with whether having multiple personal brands is disingenuous. While she got me teetering on the idea through her tweetering, ultimately I'm sticking with my approach to personal brand strategy, although it's always open to change.

In the interim, what's your take on the topic?

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Mike BrownMike Brown is an award-winning innovator in strategy, communications, and experience marketing. He authors the BrainzoomingTM blog, and serves as the company's chief Catalyst. He wrote the ebook "Taking the NO Out of InNOvation" and is a frequent keynote presenter.

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Tuesday, April 13, 2010

Interview with Kodak CMO Jeff Hayzlett

by Adam Burns

Here are some excerpts from my video interview with Jeff Hayzlett, Chief Marketing Officer (CMO) of Kodak:

1. Are you a big believer then in this leadership idea of good leaders ask good questions?

Absolutely. I think good leaders, more than anything, listen. I think that's the most attribute to being a leader. Asking questions is one thing and asking the right questions is good, but to listen, to really hear what the real answers are, I think, are real key, because they're usually buried in there somewhere, so you have to listen very carefully. I think that's that best thing a leader can do.

2. Having an outsider's perspective and a very "can do" attitude, I've read and seen quite a few interviews with you previously. You've also very much entrenched yourself in the Kodak Company law. You know the history of the product. How do you balance those two tensions within yourself? How do you make sure that keep your outsider's perspective, plus being the company man?

When you say "being the company man or company person," it's more about I know the core tenants of the brand and the core tenants of what George Eastman started to do. So when I first came to the company, and I was already a big fan before, but when I came to the company, I read everything I could get my hands on. I read his biography. It was one of the most important documents and I got a sense if who he was and how he really made things very simple.

I thought, "If we can carry that forward, wouldn't it be a great thing? How can we bring those things that were so tantamount to what he thought the company should be, like push one button and we do the rest?" That translated itself into the EasyShare sub-brand, in terms of making an easy share. So we wanted to do the same thing with our printers, our cameras and our commercial print products. We make them so easy that anyone can really operate them or make them so easy that we make ourselves so easy to do business with.

So that's a big part of what we have to do, at the same time, challenge that. So ask the product teams, "How are we making this simple? How are we getting this easier for the customer? How are we eliminating the filters when we start talking to our customers? Why can't we get on Twitter? Why can't we get online? Why can't we design products more directly with our customers?" Those are the kind of questions, but, yet, keeping the core things that are important to our value, as a brand, at the forefront? I think that's important to do.

3. Absolutely. That "push one button," is almost perfect for today, isn't it?

It's brilliant. This guy, George Eastman is brilliant. He had some personal issues, if you get to know who he was as a man, but he was truly almost a savant, in terms of the way he did it. He wrote his own ad copy. He designed the business. He had major problems when he first launched where he put out photographic plates and they went bad. You know what he did? He replaced them all. That's what somebody who is a good business leader does. So how can you bring that same sense of core of your beliefs all the way through the organization? That's really what we try to do.

We put together a program very early on when I joined the company, called "FAST," which stood for focus, accountability, simplicity and trust, which really means fast or speed. So even if we screwed up, if that's all we got out of it, was we went faster, and even if we screwed up, we did it faster. That was kind of our joke, internally, because we pushed all these people together and all these companies together when we first started doing the turnaround and the transformation, and things weren't working the way they should have been. So what we said was, "Let's do it fast. What is it I do inside the company, my accountability? What are the promises that I must keep for the company?" My five promises I delivered to my boss, the five that my staff delivers to me, the five that their staff - and so on and so on.

Then simplicity is just not a get out of jail card free, because we don't believe in that, but a permission slip to change things, because you have a big, big company and things are gonna be procedures and rules and policies, which you need, but really more as guidelines, not necessarily that they're law. So if you see a simpler way of doing it, and you're not breaking the law, then go ahead. Why not do those things?

Then "T" stood for trust, which, for us, is healthy debate, to be able to question the status quo and to say, "I think there's a different way of doing that," and then to be comfortable in the organization to challenge a senior executive and challenge the CEO at a town hall meeting. That's what we instilled in the company and I will tell you, five years prior to us joining the company, 10 years, 20 years, there is no way people would have done that. It was a very hierarchal organization that had different lunchrooms for different people on staff. It had conference rooms had that only executives of the company could reserve. Who has that? Things like that that we had to just say, "Does that make sense?" And just give permission to people to change those things.

Here is a teaser for the video interview:

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Adam BurnsAdam Burns is the Senior Editor of MeetTheBoss TV.

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Eight Mistakes to Avoid with Your Customer Loyalty Program

by Matt Heinz

Eight Mistakes to Avoid with Your Customer Loyalty ProgramLet's say you're building a loyalty incentives program for your product. Everybody has great ideas about what will motivate the desired customer behavior, outcome and lifetime value.

You're clearly not the first company to build such a program. What if you could read through a bunch of post-launch post-mortem reports from their own experiences? What if you could understand which components of your current plan should be scrapped, reversed or modified before they see the light of day?

I unfortunately do not have this magical stack of reports, but I do hear many of the same things over and over as marketers move to "V2" of their loyalty programs. Here are eight statements I hear most often.

1. We should have focused on the customer's priorities, not just our own.

This may seem like a straightforward concept, but it's not how most loyalty programs are built. Loyalty programs, by their nature, are intended to drive activity that has been pre-determined to drive value for the company. Shop here more often, increase your order size, refer your friends so we don't have to spend more marketing dollars. All great ideas. Problem is, many loyalty programs are built such that they so directly and transparently focus on these end-goals, that there's little value or actual incentive built in for the customer.

Building your loyalty strategy needs to be a two-step process. First, by all means determine your objectives. Know the business outcome you expect to create. But then, translate that into something customer-centric. Find the ties between your business objectives and your customer's priorities. Those direct ties - where there's little to no friction between what both parties want - is likely the foundation of how your loyalty program will grow and thrive.

2. We made it too complicated.

Collect points, bundle them together, mail them in, then win a prize. Thanks for playing. Refer us to your colleagues, answer three trivia questions, then come back next week and answer three more. Then you're entered in our drawing.

OK, not every loyalty program is that complicated. But think about the programs you like the best. They don't require a lot of work. They don't require math. You do what you've been doing, and things happen. Buy an airline ticket, and you get miles. Buy enough tickets, and you get a free flight. Shop at my grocery store all the time, and we'll give you lower prices on certain items.

Problems with loyalty program complications arise when 1) you make the customer think too much, 2) you add too many steps to collect the motivation, or 3) you require either math or memory. Don't do these things. Make it simple, at least at first.

3. When we stopped marketing, the program stopped working.

If you have to keep asking your customers to participate, then your loyalty program 1) isn't really resonating, and 2) isn't sustainable. If it doesn't eventually create a habit - where customers know it exists, want it, and naturally take the right steps to get it on their own - then it's either too complicated or not tied to an important-enough customer interest.

When you launch a new loyalty program, of course it's going to need its own stand-alone marketing campaign to build awareness and participation. But eventually, ongoing marketing of the program to existing customers should happen less frequently, less interruptively, and largely via existing communication channels.

If as you build your new loyalty program, this end-goal doesn't feel achievable, keep thinking.

4. We didn't need to spend as much money to get the same behavior.

Your customers are money-driven, all of them. They want more of it, they want to spend less of it, they want products & services that will help them get and save more of it. They also don't mind free stuff, so if you want to drive behavior, you can 1) give them money, 2) save them money or 3) give them something cool for free.

Or, you could put a star next to their name on your Web site. You could make their membership card a different color. You could let them into the store an hour early. You could give them a special phone number that puts them at the front of the call queue.

Your customers are motivated by money, but not just money. They also want to feel special, have special privileges, demonstrate they're different or better than their peers or colleagues. The better you understand your customer and what ultimately motivates them, the more things beyond money you'll realize can be powerful drivers of behavior. And many of those cost next to nothing.

5. Our best customers just wanted to be recognized.

This is a subset of comments above, but an important one. Recognition, differentiation and ego are powerful motivators. They work with business and consumer audiences alike. They are likely motivating behavior with your product independent of any existing or non-existing loyalty program.

And recognition can come cheap. A club that's little more than a name. A personal letter from the CEO or store manager. A hand-written thank you card. Their name written on the wall. Cheap but effective.

6. It was too much work.

Ambitious new programs often require new tools, extra bandwidth, and more people thinking about and acting upon the program to make it work. If this work is required of existing people, existing systems and existing budgets without adding additional time or resources to execute, you're doomed to failure (or at least frustration from the get-go).

As you've already seen from examples listed above, great loyalty programs don't need to be complicated. They don't need to require significant new infrastructure, policies or procedures to make them work. And if they do need new resources, the program had better be important enough and cross-functionally supported well enough to get the support it needs to succeed.

7. We should have tested it before the full roll-out.

Even if you follow the advice above and more, you'll still not get it right. You'll still find ways to improve. Better to know that with a subset of customers before those mistakes are made with your entire base.

Pick a handful of customers for a test group. Not your most vocal, not your most favorite. Try to find a cross-section, or a segment that's naturally unbiased (i.e. a particular store, or all customers in a particular city or state). Don't just tell them about the program, but try and actually roll it out. Feedback you get in a focus group or survey will be different from what they tell you when they're faced with what you're actually requiring them to do.

8. We didn't involve others throughout the organization.

It's fine if the marketing team plans and spearheads the launch of your loyalty program. But execution should be a cross-functional effort. Every customer-facing team and individual should know about it and help you promote it. Teams and individuals beyond marketing could themselves have incentives for how well they get customers involved.

Marketing today can't be contained to the marketing team. Every member of your organization is helping to market your product, service, brand and company. The customer-facing teams do it directly. But your developers build product that impacts how your customers feel about you. Your finance team makes decisions that impact how well you can support them.

Each one of these groups will play a role in making your loyalty program successful. And if it truly drives the right behavior and business results, they'll be proud and motivated to continue their support & participation.

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Matt HeinzMatt Heinz is principal at Heinz Marketing, a sales & marketing consulting firm helping businesses increase customers and revenue. Contact Matt at matt@heinzmarketing.com or visit www.heinzmarketing.com.

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Thursday, April 08, 2010

Social Media Demystified

by Mike Myatt

Social Media DemystifiedIf you find all the noise around social media to be confusing, rest assured that you're not alone. If you're among the group of active users who no longer find it confusing, but still haven't hit your stride, you're also in good company. Blogging since 2002, being actively involved in digital marketing since the early 90's, and being online since the days of the ARPANET I have a bit of history with most things digital. What's interesting to me is that with every major advancement in the web comes a mixed bag of apathy, over exuberance, confusion, chicanery and even outright skulduggery that makes life much more complicated than it needs to be. In today's post I'll bust a few myths, reveal an evil secret or two, and share with you what you need to know in order to be successful with social media...

Understanding the Context

Let me cut right to the chase - business is fluid. Successful businesses adapt to market innovations and thrive, while those that fail to make iterative leaps fall by the wayside. With each major advancement in technology, communications, or business practice we find ourselves yet again at this all too familiar precipice. If you adapted to desktop computers, fax machines, cell phones and the Internet, then I suggest you need to view social media as the next progression on the continuim of advancement. When markets make a major move, you either move with them or get run over by them.

What the Soothsayers Want You to Believe

Have you ever noticed that profiteers seem to congregate around the complex, or at least what they can alter to appear as complex? Anytime new advances can be spun into something bewildering or beguiling there are fortunes to be won and lost. Regrettably, there seem to be legions of social media 'experts' who take great delight in unnecessarily complicating something that is really not complex at all. Allow me to let you in on an evil little secret - social media is really quite simple.

While I'm not going to deny that social media brings with it new tools, platforms and communication channels, I vehemently object to the premise that you need to morph into an uber geek or communications savant to learn to use them and to reap their many benefits. Spare me the complex charts & diagrams, and the trite commentary from the latest guru. What's needed is less smoke and mirrors and more common sense. As you'll see below, social media is nothing more than leveraging technology and resources to communicate with meaningful constituencies in meaningful ways - How could that possibly be a bad thing?

The Evil Secret Revealed

The simple reality is that social media has way more to do with common sense than it does with rocket science. Let me make this as simple as I can... social media simply provides you with tools and channels that allow you to extend your reach and better engage those with whom you wish to communicate. What's so complicated and confusing about tools that put you right where you've always wanted to be, and perhaps more importantly, right where you need to be?

Forget all the buzzwords and acronyms, social media is about meeting your constituencies where they are - in a setting of their choosing, and communicating with them on their terms. Social Media affords you an exceptional opportunity to listen, gather intelligence, build trust, engender confidence and credibility, publish valuable content and have meaningful dialog in ways that were once thought to be impossible. Social Media doesn't make things more complex, rather it reduces things down to the ultimate level of simplicity. It's really this simple... if it's not a priority for you to efficiently and effectively engage with your stakeholders, then you need to reevaluate your priorities.

The Key to Success

Success or failure in social media is nothing more than making a simple set of good choices. You must choose to get off the sideline and into the game, then you must choose to endure the learning curve, and finally you must choose to deploy the needed resources to be successful. Let me be very clear here - as the CEO or entrepreneur, YOU and not your legal counsel, marketing director, ad agency or PR firm must make this choice. Don't allow yourself to be dissuaded by conventional thinking, flimsy logic or uninformed opinions.

If you believe the hype, social media will immediately solve all your problems and require no time, energy or effort on your part. I'm always amazed at those who think all they have to do is launch a blog, create a LinkedIn profile, put up a Twitter page and open a Facebook account and all their business problems will be solved. If you buy into this line of thinking my guess is that it won't be the first time you've fallen prey to a failed initiative around the latest trend.

I always love the excuse "I don't have time for social media." Really? What are you so busy doing that you don't have time to build better relationships with precisely those individuals and groups who can help you achieve your goals and objectives? Social Media is no different than anything else in life in that you get out of it what you put into it. No effort yields no results, part-time efforts yield part-time results, and exceptional efforts lead to exceptional results.

Yes - social media will require an investment of time and resources. That said, prudent investments into social media serve as a force multiplier catalyzing both leverage and velocity simply not available via other mediums, platforms and channels. My advice is simple. Stop rationalizing and justifying doing the wrong things for the wrong reasons, stop whining & complaining and get in the game - do the right thing.

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Mike MyattMike Myatt, is a Top CEO Coach, author of "Leadership Matters...The CEO Survival Manual", and Managing Director of N2Growth.

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Tuesday, April 06, 2010

Turning Customers into Ambassadors

by Matt Heinz

Turning Customers into AmbassadorsGuess what? You already know how, because you're already doing it.

More specifically, your best customers are already doing it. You may not know it, you may not know exactly who's doing it, and you may not know how they're doing it or how they got that way. But it's happening.

Some of your customers went from prospects to new customers to happy customers to ambassadors. Your job is to find out how and why, and establish that path for more customers moving forward.

In other words, don't artificially engineer a path to make customers happy. Don't create an incentive program or a loyalty program or other customer success initiatives out of the air. Find out what's occurring naturally, what's already driving higher loyalty and ambassadorship among your customers, and build processes to make it happen more often.

The first step is to segment your ambassadors from your "average" customer. Then ask the following questions:
  • What was their path to becoming a brand ambassador? How did they get there?

  • Who's on that path today, and where did it start? What were the important milestones?

  • Are there shortcuts or catalysts on that path? Are there experiences, results, features or otherwise that accelerate the path to advocates?

  • Who helped those customers along the way? Who were their mentors and/or guides? Who (besides you, besides your company) can help show them the way?

  • What are those ambassadors doing to share their passion with others? With either other customers or prospective customers?

Many of these questions you can answer by looking at past behavior and performance. Dig into your customer database and analytics, and find out what your ambassadors have in common.

You will find ambassadorship accelerants that will surprise you. That are easy to replicate. That cost next to nothing.

This analysis can take some time, but it's worth it. In the meantime, do the following:
  • Underpromise and overdeliver.
  • Respond. Quickly. Personally.
  • Be accessible.
  • Be human.
  • Make things simpler.
  • Focus on results.

These things always work. And notice most of them are about service, not product. Even in a product-oriented business, service can mean everything. And much of what will work is faster, easier and cheaper to make happen than you may realize.

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Matt HeinzMatt Heinz is principal at Heinz Marketing, a sales & marketing consulting firm helping businesses increase customers and revenue. Contact Matt at matt@heinzmarketing.com or visit www.heinzmarketing.com.

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March's Top 10 Innovation and Marketing Articles

January's Top 10 Innovation PostsThis year I thought I would experiment with a Top Ten list at the beginning of each month, profiling the ten posts from the previous month that generated the most traffic to Blogging Innovation. So, without further ado, here are March's ten most popular innovation or marketing posts:
  1. Top 100 Lamest Excuses for Not Innovating - by Mitch Ditkoff

  2. Three Models For Applying Customer Feedback to Innovation - by Hutch Carpenter

  3. The Age of Innovation - by Alan M Webber

  4. Messy But Successful Social Media - by Idris Mootee

  5. Distributed Idea Generation Outperforms Team Brainstorming - by Hutch Carpenter

  6. Innovation Metrics - A Whole Brain Strategy - by Mike Brown

  7. An Airline Innovation - "Cuddle Class" - by Kevin Roberts

  8. The Performance Paradox - by Stephen Shapiro

  9. 8 Design Tips for Startups - Moving Beyond Aesthetics - by Thomas Petersen

  10. Inspiring Corporate Entrepreneurship to Fuel Innovation - by Robert F Brands

If you're not familiar with Blogging Innovation, we publish 2-3 new articles every day built around innovation and marketing insights from our roster of contributing authors and ad hoc submissions from community members.

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Braden KelleyBraden Kelley is the editor of Blogging Innovation and founder of Business Strategy Innovation, a consultancy focusing on innovation and marketing strategy. Braden is also @innovate on Twitter.

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Saturday, April 03, 2010

Innovation Perspectives - Challenge Your Specialists

This is the sixth of several 'Innovation Perspectives' articles we will publish this week from multiple authors to get different perspectives on 'How should firms develop the organizational structure, culture, and incentives (e.g., for teams) to encourage successful innovation?'. Here is the next perspective in the series:

by Michael Soerensen

Innovation Perspectives - Challenge Your SpecialistsChallenge your specialists, to help you develop an innovative culture!

After you have checkmarked all the essentials of getting your company to focus on innovation - tools, workshops, gurus, funding, and management buy in - you are now faced with the biggest challenge:

How to develop and maintain it!?

First, try to SWOT what you need to succeed - HR competencies, communication, internal marketing, ROI methods, nifty design, IT...

Why start doing this halfhearted, when you already know that you don't possess these skills?

Many innovative efforts - even with the largest funding and management buy in - have failed because these key elements were not done properly. Instead of failing, make sure that you get carte blanche to tap into your company's specialists:

HR - They are brilliant at helping you tackle the different sub-cultures of the company - and knowing how to get them involved!

Sales & Marketing - They can help you design a marketing plan and a pitch - and your webmaster probably knows some mind-blowing methods of spreading the word on your intranet!

Finance - The numbers people will love the challenge of setting up that awesome spreadsheet on the innovation ROI!

Production & Engineering - These hands-on groups will be pleased to evaluate - and test - the groundbreaking new product ideas!

IT - Don't forget them - they are vital!

All of above are savvy specialists, who know their way around their subjects, and if you involve their key competencies in the challenge, you will be on the road to success - harnessing their vast knowledge and dedication.

And a great side effect is that you will get ambassadors and lobbyists working for your project, in every vital and strategic corner of your company!

After you do the above, don't forget to play your part:
  • Publish all results... good or bad!
  • Support, support... and support everybody involved!
  • Make sure to announce any progress - personally - and throughout the company!
  • Embrace suggestions to your project with enthusiasm!
  • In general, spread kudos and karma to everyone helping you out!

And finally - keep challenging your enrolled experts and specialists, with important new tasks!

April Sponsor - Brightidea
You can check out all of the 'Innovation Perspectives' articles from the different contributing authors on 'How should firms develop the organizational structure, culture, and incentives (e.g., for teams) to encourage successful innovation?' by clicking the link in this sentence.
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Michael SoerensenMichael Soerensen is CMO at Nosco.dk, a danish company, creators of the SaaS innovation platform; Idea Exchange. Michael is a serial entrepreneur, and after great successes and learnful failures he is now truly at home with his buddies at Nosco.

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Tuesday, March 30, 2010

When Selling Your Innovation is Your Constraint

by Michael A. Dalton

Selling Your Innovation as ConstraintIn a recent Fast Company article and video on Open Forum, Dan & Chip Heath, co-authors of "Made to Stick", look at how to explain what your innovation is and what it does. If ideas aren't accepted they can die quickly, and there's a lot riding on getting it right. From a Theory of Constraints or critical chain perspective, once your new product is launched, your constraint often becomes market acceptance. In some cases that means getting people to understand what your innovation is and how it can help them.

There are lots of things that can constrain how readily the market accepts your new product or innovation, but the Heaths cover a very important one: helping potential buyers quickly understand what the product is and what it does. Anchor and Twist are the two suggestions they offer. Anchor your product to something they already know. Twist to show how it's different than everything else. Here's an example with Palm's Pre phone:

First the anchor: The new Palm Pre phone is like Apple's iPhone.

So big deal - it's just another touchscreen smartphone...

Then that's where the twist comes in: But it has a slide out keyboard if you don't want to use the touch screen and it can run multiple applications at the same time - something the iPhone can't do (yet).

You might recognize anchor and twist as part of the unique selling proposition. The only thing I would add is the benefit. Why do they care? What's in it for them (WIFT)?

Back to the Palm example --

WIFT: It can run multiple applications at the same time, which makes it easier to use. I can be writing an email, switch to my contacts to copy a phone number or address or jump over to Amazon to copy a link, and then hop back to the open email without having to restart the email application. A big deal when you use your smartphone for greater than 50% of your emails.

The Simple Bottom Line: So, the point here isn't to sell anyone on the Pre. The iPhone has some pretty big benefits too. But the point is that whatever your innovation, you can speed acceptance and increase your new product sales by getting the marketing right - that means Anchor, Twist... and be clear on WIFT.

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Mike DaltonMike Dalton is the Chief Innovation Coach for Guided Innovation Group and the author of "Simplifying Innovation" and the Simplifying Innovation Blog. Guided Innovation Group has a simple mission - helping companies turn their new product innovation into more bottom-line impact.

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Saturday, March 27, 2010

Customer Loyalty is Your Ultimate Competitive Advantage

by Matt Heinz

Customer Loyalty is Your Ultimate Competitive AdvantageIt's not a secret that loyal customers are good for an organization or brand. You don't see too many executives saying they don't want more of them. But what's interesting to me is how few companies truly acknowledge, take care of and leverage those loyal customers in a way that measurably accelerates market share and recurring revenue while mitigating competitive risk and reducing sales & marketing costs.

New customer sales & marketing? - At most companies that means a meaningful lead generation budget, a full sales team, lots of support and attention.

Existing customers? - A newsletter, maybe some training, and an 800-number if they have questions.

This is a broad generalization, but you get the point (and you've seen it, both at companies you work with and for, as well as directly as a customer of others).

How are your current customers perhaps your most valuable competitive edge?
  • Treat them right - deliver a fantastic product or service - and you can count on their business for life

  • Be remarkable, and they'll tell their friends and colleagues about you as well

  • Earn their trust, and they'll tell you exactly what they're seeing in the market - your competitors, new innovations, etc.

  • Engage them regularly, and they'll tell you when you're wrong, when you screw up, and give you time to fix it

  • Actively listen, react to their feedback, innovate when they ask, and they won't go anywhere

  • Create an army of ambassadors, and they're an extension of your sales force in situations you have zero access to today

  • Make them your eyes and ears, and they'll give you the earliest heads-up possible to any competitive threat on the horizon (with enough time to react, adjust, and cut competitors off at the knees before they can get momentum)

  • Ask them to brainstorm with you, and they'll give you far better, more creative ideas than you'd ever come up with yourself

  • Surprise them with your responsiveness, speed and approachability, and they'll treat you like a loyal friend

You can do this. You can do all of this, and most of it doesn't cost any more than a change in how you manage your customers. How you talk to them. How often, with a different message, a different tone, and both more frequency and thoughtfulness.

Your customers desperately want this from you. They've made a commitment to you (in a big or small way), and all they ask is that you return that commitment to them.

There's no question in my mind that every business has significant and measurable revenue potential with greater focus here.

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Matt HeinzMatt Heinz is principal at Heinz Marketing, a sales & marketing consulting firm helping businesses increase customers and revenue. Contact Matt at matt@heinzmarketing.com or visit www.heinzmarketing.com.

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Tuesday, March 23, 2010

Voice of the Emergent Customer

by Drew Boyd

Voice of the Emergent CustomerAre some customers better than others at developing new concepts? Professor Donna L. Hoffman at the University of California Riverside thinks so. Emergent customers have a unique ability to "wrap their head" around a new concept and improve it. She created a scale to identify them so companies hear the voice of the 'right' customer during new product development.

Emergent customers are better at imagining how concepts address latent unmet needs. Dr. Hoffman describes it as a "unique constellation of personality traits and processing abilities that enables such consumers to engage in a synergistic process of visualization and rationalization to improve product concepts." Those characteristics are:
  • Openness to new experiences
  • Reflection
  • Experiential and rational processing style
  • Verbal (rational style) and Visual (experiential style)
  • Creativity (self perceived)
  • Creative personality
  • Optimism

The study included 1,124 respondents and compared performance of those identified as emergent customers against those of lead users, early adopters, and a control group. The emergent customers significantly outperformed the other groups.

How would you put this to use?
  • Market research firms could use the scale to screen research candidates. Emergent customers focus on improving concepts, while 'non-emergent' customers judge marketplace acceptance.

  • Companies could learn about their emergent customer's behaviors and beliefs. Do they buy more, use more, or pay more for certain products? Do they use products in a different way? Do they influence other customers?

  • Companies could set up advisory panels of emergent customers to watch for opportunities and threats.

How would emergent customers perform using a structured innovation method? It is tempting to assume they would do better using methods like S.I.T. These people are more motivated and optimistic. They are more hopeful about the output of innovation workshops and are likely to push harder. Star performers "Google" their mind to make innovative connections and associations in rapid fire fashion. This relates to Dr. Hoffman's factor of "experiential and rational processing style."

For innovation workshops, my 'dream team' would include a mix of emergent and non-emergent participants. Perhaps the ideal scenario is pairing them together. As the emergent thinker pushes ideas into new territory, the non-emergent thinker can offer quick feedback. Innovation is a team sport after all.

Researchers have long noted that the "voice of the mainstream customer" is not that useful in developing new products. Instead, finding the 'Voice of the Emergent Customer' could be a new source of competitive advantage.

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Drew BoydDrew Boyd is Director of Marketing Mastery for Johnson & Johnson (Ethicon Endo-Surgery division). He is also Visiting Assistant Professor of Marketing and Innovation at the University of Cincinnati and Executive Director of the MS-Marketing program. Follow him at www.innovationinpractice.com and at http://twitter.com/drewboyd

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Saturday, March 20, 2010

Innovation Equality

by Tom Peters

Nobody disagrees with the fact that there are few things and maybe no things these days that are more important than innovation. I just want to add one small twist to that and it's what I call my Innovation Equality Act. And what I mean by that is, when we think of research and development, we almost always think of new product development. Well, here is my iron law, my request, my command, my rule:

Innovation and R&D budgets of significance are equally important in every single piece of the organization.

They are important in the logistics function. They are important in the purchasing function. They are important in the HR function. They are important in the finance function. That is, innovation (and R&D) is about every single nook and cranny within the organization. It's not just a marketing thing. It's not just a new product development thing. Think about it. An R&D budget in every training or HR department; it just doesn't happen very often, and that is genuinely, truly dumb.

You are just as likely or more likely to find that elusive competitive advantage in purchasing or HR as you are in an official engineering or marketing department.

What do you think?

Editor's Note: Tom Peters has just launched a new book "The Little BIG Things: 163 Ways to Pursue Excellence" - click here for more information

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Tom PetersTom Peters is the author of "In Search of Excellence" and twelve other international bestsellers, and a consultant, columnist, seminar lecturer, and more at the Tom Peters Company

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Sunday, March 14, 2010

Is Crowdsourcing Disrupting the Design Industry?

"This is an issue that I simply cannot wrap my head around. Spec work appears in the design field infinitely more times than any other industry. It absolutely floors me that people think that it is even remotely ethical to build their businesses by tearing down ours."

- Mark Hemmis' comment on AIGA policy statement on spec work

by Hutch Carpenter

Is Crowdsourcing Disrupting the Design Industry?The past couple years have seen an increase in the use of crowdsourcing by companies to procure design assets. It works like this:

  1. Requesting organization posts a request for submissions to a design crowdsourcing site (e.g. 99designs, crowdSPRING, MycroBurst, etc.)
  2. Interested designers review the request, and create their entry
  3. They submit their entry to the site
  4. Requesting organization selects its favorite, pays the winning designer the announced fee

These design requests are often for logos, but for a number of other types of initiatives as well. For example, 99designs' list of requests (to the right) gives some sense of the types of projects.

So far, so good, right? Well, a lot of designers think not. As Mark Hemmis' comment above shows, these open spec work contests have been raising the ire of the designer community.

Is crowdsourcing ripping their industry asunder?

Designers' Beefs with Crowdsourcing

Three aspects of crowdsourcing design raise concern for many in the design industry:

  1. Lack of compensation for designers whose entries are not selected
  2. Diminishes the design profession
  3. Not sustainable in the long term

Compensation: To be competitive, individuals will need to invest some time in designing a submission for a company. With a good number of entries, this equates to a decent number of hours invested. According to Pamela Pfiffner:

"The problem is, spec and crowdsourcing can lower your value and hourly rates so far that minimum wage looks like a fat paycheck."

Her statement takes things to a logical extreme - someone would have to do nothing but spend their time entering contests. But she does a good job framing the issue.

Diminishing the profession: The issue with crowdsourcing is that it says, "this stuff is easy!" A commenter on this post, How NOT to Design a Logo, baldly gives this concern legitimacy:

"Logo design contests are great, its the only way I go. I get my pick of 5-10 designs for less then $20. Designers these days are a dime a dozen, be happy you get the work."

The design industry has characteristics of being craftsman, as well as strategists. At least the higher end firms do. Sentiments like that are grating.

Not sustainable: The concern here is that over the long term, the economics of crowdsourcing will cause existing designers to exit the industry, and potential designers will opt for different careers. According to Jacob Cass:

"Design contest sites are not the future of graphic design... nor do I see a time when it ever will be, however, in the long term I believe spec work is going to be detrimental to the design industry... both devaluing design and designers as a whole."

The argument here is that rather than expand the pool of talent for design, crowdsourcing will ultimately reduce the industry.

So designers themselves are lining up against these types of crowdsourcing design contests. Which begs the question...

Why Are Crowdsourcing Design Contests Growing?

Jason Aiken has this to say:

"Truth is - 99designs is growing by leaps and bounds. We have record numbers of projects being launched and have needed to hire new staff to help us keep up with the growth.

The motivation of organizations seeking design work seem clear enough - tap a large network of creativity, manage expenses within budget. But what are those designers doing there?

It seems that not all designers are of the same mind about these crowdsourcing design contests. Some actually embrace them. Why?

Build your portfolio: Not all designers in the world have 10 years experience and a roster of paying clients. For those starting out in the business, the competitions provide great fuel for creating designs. If you want prospective clients to see what you're capable of, the design competitions seem to offer a chance to create that portfolio.

Benefits include:
  • You need to think not abstractly about design principles, but concretely about how a design project relates to a business
  • Competitions are great for elevating one's focus and creativity
  • You can benchmark yourself against other submissions, including those selected if yours is not

Personal interest: Some projects just pique the interest of a person. Maybe there's a day job with a paying company, and then a chance at night to do things "your way" on a project of interest. The project taps some areas you want to pursue, or maybe allows you to try something out without concern as to whether the client will ultimately want the design.

Extra business: Everyone is hustling in a weak economy. If your design business has some slack in demand, why not apply the available creative resources toward an occasional crowdsourcing project? If you're a professional shop, presumably your odds are better than most.

Access to high-end ad agencies: This was the case when Porter Crispin + Bogusky solicited logo designs for their start-up client Brammo, maker of electric motorcycles. They ran the contest through crowdSPRING. The contest sparked plenty of debate, but also saw 700 entries. One reason was that young up-n-coming designers wanted the chance to impress a firm of the caliber of PC+B, who can send many paying clients their way.

That's the designer participation set of motivations. I guess the best way to think about companies' motivation is this - Do they get results?

Since the number of requests from companies is growing, design crowdsourcing sites are working at some level. If they weren't, word would spread pretty quickly and companies would stop using them. This comment from designer Morgan Stone on Alex Bogusky's blog post about PC+B's use of crowdSPRING is illuminating:

"As a designer... crowdsourcing scares me. I think it has to do with the harsh reality that sometimes it doesn't take experience or a big title to design something truly amazing."

What's the staying power of the crowdsourced design contest approach? And will it disrupt the industry, in the Clayton Christensen sense?

Sustainability and Reach of Crowdsourcing Design Contests

Altimeter Group's Jeremiah Owyang wrote last year, "Without a doubt, Specwork (like crowdspring or 99 designers) is here to stay - economics will drive this forward." For the buyers, yes. But the supply side of the equation - the designers - is that here to stay?

I believe it is. The numbers say it is. Here's what I mean:

Crowdsourcing Design Contests
In a 2009 article, Forbes noted that there are 80,000 free lance designers in the U.S. alone. Add in the talent from around the world, and you can see that there is a large of pool of creativity. Maybe 200,000 designers globally? 99designs claims to have roughly 54,000 designers on its site.

Designers have some motivation to participate in crowdsourcing design contests, as noted for the reasons above. It's not like every designer will submit regularly. But every project reaches some new set of designers, and occasionally gets a repeat one as well.

All it takes is for a business seeking design work is maybe 30, 40, 50 submissions? As a percent of the global number of designers, that's not much.

40 / 200,000 = 0.02%

Here's what designer David Airey said about getting clients from crowdsourcing sites:

"I've had direct clients and also have been one of those in the crowd. Surprisingly, some of my best clients are the ones that followed me from these crowd sourcing sites. That's probably because they've already been through a working process with me, and they like what they've experienced, so there's no mismatch of expectations like a new client."

I do see the sustainability of the business. It's complex, but there are enough people who do see advantages to participating. Even if only for certain periods of their lives or only on occasion. I don't see entering crowdsourcing design contests as a full-time pursuit for someone.

Next question: how much can crowdsourcing chip away at the traditional areas of the design industry? Is there a gap that crowdsourcing addresses? (Erica's post, Bokardo's post):

Many designers in the debate note the importance of establishing a rapport with clients, and understanding their clients more deeply than a set of colors and fonts. A firm such as Nocturnal Graphic Design Studio appears to deliver value through deeper relationships and more strategic approaches with its clients.

But Erica's point above is well-taken. Sometimes, you're not in the market for that level of involvement. Small and mid-sized businesses do not need the full horsepower of high-end design firms. As one designer (snootily) commented on the PC+B blog post about using crowdSPRING:

"99 designs and their nefarious brethren have a client roster whose market recognition for the most part is similar to that of Joe's Morgue & Jerky Outlet."

Of course, this may not be contained to SMBs.

The Disruptive Potential

Have you checked out what Mountain Dew is doing with crowdsourcing (aka "DEWmocracy")? As Wired notes in a January article:

"Mountain Dew is asking consumers to choose three new sodas, from selecting the flavors to naming them, designing the cans and choosing the ad agency to promoting the product."

Not all of this is crowdsourcing design, but it is an edgy experiment in leaving the professional firms behind.

Right now, as Steve Douglas of the Logo Factory notes, the biggest chunk of business is for logos. Which you can see at the start of this post in the 99designs project list.

The U.S. Census Bureau had the graphic design industry generating $2.8 billion in revenue in 2002. It is a large, diverse, complex industry. My expectation is that design contest crowdsourcing will encroach more into large enterprises for tactical projects, as the smaller businesses continue to use them and get good results. Large companies' efforts, such Mountain Dew's DEWmocracy, Unilever's crowdsourcing contest for a TV campaign for its Peperami snack food, and Doritos' crowdsourced Super Bowl ads, add fuel to this.

Two things are needed for the crowdsourcing model to encroach further into the design industry:
  • Leaderboards/reputation
  • Smartsourcing

Leaderboards let prospective buyers know who the best are. We see them on Topcoder for programming contests. It's a way to establish visibility and credibility far beyond the recommendations you maintain on your own site. It will take some changes by the crowdsourcing sites, enabling recognition for designers who do well in contests, even if they are not picked. It also would need to have different bases for identifying top designers.

The other wrinkle is to allow a form of smartsourcing. Once the top designers are identified, they are invited for larger companies' design projects. This is pretty similar to the current state of things, except the basis for access changes somewhat. It's not just business relationships a designer/firm has established with the big ad/marketing/brand agencies. It's based on performance.

With these two elements, I can see how crowdsourcing becomes more important, more disruptive, in the world of business design.

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Hutch CarpenterHutch Carpenter is the Vice President of Product at Spigit. Spigit integrates social collaboration tools into a SaaS enterprise idea management platform used by global Fortune 2000 firms to drive innovation.

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Tuesday, March 09, 2010

Setting Expectations for White Space - Apple iPad

by Adam Hartung

It's easy to misunderstand White Space. About twenty years ago Apple launched the Newton. The company sold about 375,000 of the first commercial PDAs, but Apple's leadership thought the market wasn't really there - and decided instead to focus on growing Mac sales. Obviously, as Palm and other PDA makers demonstrated, there was a tremendous market for PDAs. Apple misread the feedback from White Space.

Look now at the recent iPad launch. Silicon Alley Insider headlined "Now That They've Seen Apple's iPad, Most People Don't Want One." The headline keys on the fact that after the launch the number of people who said they were not interested to buy doubled (26% to 52%). Wrong fact to grab onto.

Apple iPad Sentiment
Instead, look at the fact that the number who said they would buy one tripled, from 3% to 9%. This is incredible, and should excite Apple's management as well as employees, suppliers and shareholders.

Most people will see a new, innovative product and say "why would I want that? I already have this other thing and it works great." And that is what marketers should expect. Most people are just trying to 'Defend & Extend' what they regularly do, and thus all the want is a product that helps them do their thing a little easier, faster, better and cheaper. They want minor improvements - variations and derivatives of what they already have. Improvements that are immediate, without them doing anything new or different.

All new deeply innovative products start with customers who are under-served or unserved. And this is why it is so important they be launched in White Space. White Space teams aren't intended to develop the big, mass market of known customers looking for something new. White Space is about doing new things that bring in new customers, give new solutions that attract real growth. And White Space teams have to learn how the market is evolving, how they fit into the market shift and how their solution will advance the market in order to sell more.

Setting Expectations for White Space - Apple iPadFor the iPad, the 3% to 9% shift in likely buyers is huge because it shows that the iPad is an offering that appeals to people who are not today well served by their existing PC, laptop, netbook, mobile phone, kindle or mix of these solutions. 9% of respondents are saying that they see the iPad and they see a solution for what they want to get done. And if 9% of potential buyers see this option, that is HUGE. By White Space standards, often there are only .5% or 1% or 2% of people who initially see how the new product fulfills their under-served needs.

Set expectations right for White Space. White Space is not for launching variation 4 of an existing product - targeted at existing customers. That's what the marketing and sales department can do fine, thank you very much. White Space is the team that finds the 3% (or in Apple's case 9%) of users that see value in this solution, then works with them to implement the product/solution in order to make sure it fulfills the market need and is priced to sell effectively while providing a profit to the company.

Apple understands this, you can be assured. Look at how successfully the Apple White Space teams found the underserved users that jumped all over the iPod and iTunes, the iTouch and then the iPhone. They got the product positioned and selling in a hurry. And now that Apple has that skill, the company is going to apply it to the iPad. If you understand this chart correctly, you understand that it bodes very, very good things for Apple.

And it tells you the importance of having White Space teams, setting their expectations correctly, and managing them for the kind of results that can turn your organization into the next Apple. It took Apple 10 years to reach this skill level. It did not happen overnight. Or with one product introduction. And it will take your organization a few years to build this skill. So, what are you waiting on?

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Adam HartungAdam Hartung, author of "Create Marketplace Disruption", is a Faculty and Board member of the Lake Forest Graduate School of Management, Managing Partner of Spark Partners, and writes for "Forbes" and the "Journal for Innovation Science."

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