Whatcha Gonna Do With That Duck?: And Other Provocations, 2006-2012 (24 page)

With enough patience and push and consistent enthusiasm, these products have a shot at crossing the threshold. But if the mindset is “see
what works and do it more,” you’ll often discover yourself giving up long before that happens.

Inherent in the process of minimal viable product development, then, is building a trusting, large permission base that will eagerly listen to you, try your new work, and let you know what they think. And you don’t have the option of building that audience once the product is ready—that’s too late.

Internet advertising is so cheap (particularly Facebook and run-of-site network buys) that just about anyone can afford a million impressions, and a billion isn’t out of reach.

Pretty soon it turns into noise. An infinite number of impressions is dangerously close to no impressions at all.

The conversation media reps have with advertisers quickly devolves into, “how cheap can I buy a million impressions?” What a waste. That number, out of context, is nothing but a crutch, a poor stand-in for the insightful analysis that media buyers ought to be using.

Far better to focus on two things (both leading to the real goal):

Perception
. Does the ad you’re running increase the value of your name? Are you perceived as an annoyance, an interrupter—or are you a valued sponsor, a trusted friend, someone who is making things better?

and

Interaction
. Not merely a click that leads to a sale. I’m talking about any sort of interaction with you or your organization, whether it’s an online chat, a phone call, or the process of navigating your site. Too often, online marketers are focused on pennies per click instead of on long-term value per engagement.

Both perception and interaction lead to permission. Permission to deliver anticipated, personal, and relevant messages over time. Permission to tell a story. Permission to earn attention on an ongoing basis.

Impressions don’t automatically get you permission. In fact, they might cost it.

Years ago, my bosses and I needed to finalize the pricing for a new line of software I was launching. In the room, we had MBAs from Harvard (two), Stanford, Tuck and, I think, Wharton. We had three prices in mind, and the five of us couldn’t agree. So we did the only scientific thing: we flipped a coin (two out of three, just to be sure).

Pricing your product is actually simple, as long as you consider it from the buyer’s point of view. How much it costs you to make something is irrelevant. Buyers don’t care (of course, you can’t price something at a loss and hope to stay in business for long). The two keys to the analysis:

Substitutes:
Every purchase is a choice, and that means the buyer can choose to do nothing or to buy something else instead. If there are easy and obvious substitutes for what you sell, that factor has to be built into your pricing. If you make something rare and unique, you still might not be able to charge a lot—because people can always choose to buy nothing. A 42-carat diamond, for example, might be hard to replace, but it’s not worth $100 million unless someone actually chooses to buy it.

Part of the work of design and marketing is to help people understand that there are no good substitutes for what you have to offer, meaning, of course, that you can happily charge more.

Story:
The other half of the pricing formula is the story the price itself tells. A Prius at $40,000 or a Prius at $10,000 is the same car, but the price becomes a dominant part of the story. You can tell a story of value/cheapness/affordability or a story of luxury. If you price your product or service near the median, you’re telling no story at all with the price, giving yourself the chance to tell a story about some other element of what you sell.

If you’re not happy with your pricing options, focusing on your costs might not be the right path. Instead, focus on how the design or delivery
changes the availability of substitutes, and how the price becomes part of the story of your product.

But it is the new reality for just about every organization.

Vertical marketing means that the marketer (the one with money) is in charge. Vertical marketing starts at the top and involves running ads, sending out direct mail, and pushing hype through the media. Your money, your plans, your control. It might not work, but generally the worst outcome is that you will be ignored and need to spend more money.

Horizontal marketing, on the other hand, means creating a remarkable product and story and setting it up to spread from person to person. It’s out of your control because all the interactions are controlled by passionate outsiders, not paid agents.

Most marketers instinctively want control. We reach for the budget and the ad and the press release, and most of all, the powerful media middleman. We buy Super Bowl ads or schmooze the reporter.

Horizontal marketing, though, requires giving up control. We spend all of our time and money on a great story and a great service and a remarkable offering. The rest is up to the market itself. You can’t control this, and you can no longer ignore it, either.

Are we doing this because it’s better?

Or because we can?

As organizations grow, they gain an audience, revenue, cash flow, and trust. They add staff and then, soon, they decide it’s time to offer something new. Smucker’s decides that perhaps it should use its shelf space to offer a peanut butter. A corporate coach wonders if he ought to add HR consulting services. A website decides to clone a product that is made by a smaller company and that they can bring to a larger audience.

If you extend your reach because you can, because you have market power, you will probably be doing your existing customers a small service
(centralized support or billing or just one less person to deal with), but your brand doesn’t increase in stature. You had a chance to bring some of your original magic to the table (after all, it’s that magic that got you started), but all you did was bully the competitors out of the way.

On the other hand, if you extend your brand because the new offering is better, magical in the way you can make it magical, then you’ve dramatically increased not just your market share but your status as well.

Nike and Apple sometimes fit into the second category—the iPhone and some of Nike’s clothing options are clearly different/better. Starbucks did it when they launched their ice cream. On the other hand, there are literally thousands of organizations (including nonprofits) that head down the path of mediocrity by rushing to offer 57 varieties, merely to please today’s shareholders, merely because they can.

When the hardware store sells you a single screw for a dime, shouldn’t they just give it to you? Especially if you’re a good customer?

Shouldn’t that singer (you bought all her albums) return the love? You’re only asking for a few seconds, a hug, a handshake, an autograph …

It’s easier than ever to break your offering into smaller bits, into pieces that are part of the whole but are tiny on their own.

Add up enough small slices and that’s the whole cake. Asymmetry is the rule now, not the exception.

Small slices can’t be free in the long run, not if that’s the only kind of slice there is.

Either you need to figure out how to sell your small slices, or you need to invent some big slices that are obviously worth what you need to sell them for.

When people have their basic needs met, it’s not uncommon for wants to magically become needs. It’s our hardwired instinct to seek to fill unmet needs.

That instinct pays off for any marketer that has persuaded his market that they need what he sells. It backfires when those “needs” are seen for what they actually are—luxuries.

When you sell a want, you have to work harder, you must seduce the market, because wants are fickle, picky, and not easily bullied.

A Paradoxical Curve of Money and Effort

We all tell ourselves different stories about money, but there’s no doubt at all that the story we tell ourselves changes our behavior.

Consider this curve of how people react in situations that cost money.

A musician is standing on a street corner, playing really well for free. Most people walk on by (3 in the graph). That same musician playing at a bar with a $5 cover gets a bit more attention. Put him into a concert hall at $40 and suddenly it’s an event.

Pay someone minimum wage or a low intern stipend (4) and she treats the work like a job. Don’t expect that worker to put in extra effort or conquer her fear—the message is that her effort was bought and paid for and wasn’t worth very much to the boss, and so she reciprocates in kind. The same sort of thing can happen in a class that’s easy to get into and that doesn’t cost much—a Learning Annex sort of thing. Easy to start, cheap to try—not much effort as a result.

It’s interesting to me to see what happens to people who pay a lot or
get paid well (2, 5). The kids at Harvard Law School, for example, or a third-year associate at a law firm. Here, we see all-nighters, heroic, career-risking efforts, and all sorts of personal investment. And yet as we extend the curve to situations where the rules of rational money are suspended, something happens—people get fearful again. Don’t look to Oprah or J. K. Rowling or the Donald to bet it all—the huge amount of money they could earn (or could pay) to play at the next level (1, 6) isn’t enough to get them out of their comfort zone. Money ceases to be a motivator for everyone at some point.

Most interesting of all is the long black line at zero (3). The curve goes wild here, like dividing by zero. At zero, at the place where no money changes hands, we see volunteer labor and free exchange. In these situations, sometimes we see extraordinary effort, the stuff that wins Nobel Prizes.
Just about every great, brave, or beautiful thing in our culture was created by someone who didn’t do it for money
. We see the local volunteer putting in insane hours even though no one is watching. We hear the magical song or read the amazing poem that no one got paid to write. And sometimes, though, we see very little, just a trolling comment or a halfhearted bit of commentary. Remove money from the story and we’re in a whole new category. The most vivid way to think about this is the difference between a mutually agreed-upon romantic date and one in which money changes hands.

All worth thinking about when you consider how much to charge for a gig, what tuition ought to be, what motivates job creators, or whether or not a form of art disappears when the business model for that art goes away.

Impatient …
great marketing takes time. Doing it wrong (and rushed) ten times costs much more and takes longer than does doing it slowly, but right, over the same period of time.

Selfish …
we have a choice, and if we sense that this is all about you, not us, our choice will be to go somewhere else.

Self-absorbed …
you don’t buy from you, others buy from you. They don’t care about your business or your troubles nearly as much as you do.

Deceitful …
see selfish, above. If you don’t tell us the truth, it’s probably because you’re selfish. How urgent can your needs be that you would sacrifice your future to get something now?

Inconsistent …
we’re not paying that much attention, but when we do, it helps if you are similar to the voice we heard from last time.

Angry …
at us? Why are you angry at us? It’s not something we want to be part of, thanks.

Jealous …
is someone doing better than you? Of course they are. There’s always someone doing better than you. But if you let your jealousy change your products or your attitude or your story, we’re going to leave.

Of course, they’re not marketing sins, they’re human failings.

Humility, empathy, generosity, patience, and kindness, combined with the arrogance of the brilliant inventor, are a potent alternative.

There’s no question about whether you are procrastinating about something. The only question is: what?

Knowledge work creates myriad opportunities for stalling. You can stall about making a sales call, stall about redoing a website, stall about reorganizing your department … the list of areas is so long, it becomes a stall in itself.

But deep down, you already know where you’re stalling. It’s that thing that makes you uncomfortable, probably because it involves doing something you might be held accountable for.