The Marketing Viking

I’ve recently started watching the TV show “House” and one thing confuses me: why do people think this bozo is good at his job?

Let me explain.

The typical episode goes like this:

(1) A patient comes in with strange, but non-life threatening symptoms.

(2) House  then makes a snap diagnosis. However, it’s wrong and the resulting treatment makes the patient even sicker.

(3) Then, he makes another diagnosis. He’s wrong again. Now, the patient appears to be close to death.

(4) Surely, third time will be a charm? Afraid not, he’s wrong again and the patient is told “you’ll be dead by the morning”.

(5) With about 5 minutes left in the show, House is chatting philosophically with Wilson (who is clearly the real brains of the outfit). Wilson says something that sends House scurrying back to the patient’s room where he says “You’re not dying. It’s not bone cancer, it’s just indigestion… here’s some tablets, you’ll be fine”.      

(6) Everyone now thinks House is a hero/genius and he rubs his “success” in the faces of his colleagues… including Wilson  who, for some reason, indulges him.

The whole thing makes no sense.

 Someday they’ll make a companion show called “Terry House”, who is a mechanic who can’t fix cars until he has a beer with his mate Bob (who is also a mechanic, but knows how to do his job properly).

Steve

PS Although the show is complete nonsense, I quite like it because of the interplay between the characters and the humorous dialogue. 

This is a reprint of an email I sent to my newsletter list on January 2008:

————-

I’m sure you’ve been reading about this recession we’re “about to have”.

And, being in business, you might be asking yourself “if this thing hits hard, what’s it going to mean for my company?”

Well, Clayton Makepeace , the world’s highest paid copywriter, wrote something about this a couple of weeks ago and I wanted to share it with you. Clayton wrote:

“Let’s say this recession slashes a particular business’ profits 30%.  Suddenly, the owner is earning only 70% of the profits he earned last year.

Now, as a copywriter, you could just write a better promotion in the hopes of raising his response and average sale.

But to erase that 30% decline, you’ll need much more than just a 30% sales boost.  Your admittedly inspired copy will have to boost his sales by a whopping 42%.

Willing to bet your copy can do that?  In a recession? 
I thought not.

But what if you could help his company cut costs by just 7% …

Bring him 7% more new customers …

Boost his profit on each product sold by just 7% …

Cause existing customers to order from him 7% more often …

Increase his average sale by just 7% …

And keep customers buying 7% longer?

These incremental improvements would restore his profits - and then some — in no time flat!

And if you improved each of these metrics just a little bit more - say, by a meager 10% — he’d be growing his profits by a respectable 24% per year — at a time when his competitors are losing their shirts!”

Clayton’s point - a point that he, I and many other marketers have made for years - is that you can increase your profits significantly if you just find a number of small improvements in key areas of your business.

Obviously, you don’t have to wait for a recession to do this. But if you’re worried about the economy, Clayton’s words should reassure you that business and marketing optimisation puts you back in control of the future of your business.

If you want to read the whole of Clayton’s excellent article, you can find it here:

http://www.makepeacetotalpackage.com/clayton-makepeace/the-insanity-chronicles-part-two.html

Also, I wrote a blog post in June 2007 that gives advice on what to do when marketing gets tougher. Many of the points I make also apply to marketing in a recession:

http://www.stevegibsonconsulting.co.uk/blog/online-marketing/amateur-hour-is-almost-over.php

Best wishes

Steve

I want to give thanks to a client of mine, Jamie Miller, for pointing out that the BBC had a programme about David Ogilvy last night.

I missed it, but I’ll watch it on bbci over the weekend.

Staying on the Ogilvy theme, Drayton Bird - who worked with Ogilvy and has the very enviable quote “Drayton Bird knows more about direct marketing than anyone else in the world” - David Ogilvy, on the cover of his books - mentioned me in his blog this week. 

As you can see, it wasn’t bigging me up, but for someone in my line of work, it’s a brush with greatness.

Steve

A few years ago, a business consultant called Eliyahu Goldratt wrote a “business novel” called “The Goal”. The book revolved around a number of useful business ideas, one of which - “the theory of constraints” - can help you better understand your business.

To explain how the theory works, I’m going to use the example of an assembly line:

Imagine a factory makes one product and thre are three steps of production (A, B and C) that turn the raw materials into the finished product.

These three steps have the following capacities:

A: 100 units per day

B: 60 units per day

C: 80 units per day

Now, it should be obvious that, as things stand, the most units the factory can make in a day is 60.

In fact, if the capacity was:

A: 1,000 units per day

B: 60 units per day

C: 800 units per day

It would still have a production limit of 60 units per day. That’s because B limits the overall output.

So, there’s no point in increasing the capacity of A or C unless you also manage to increase the capacity of B. That’s because B is the bottleneck (or, as Goldratt would call it, the “constraint”).

Taking this idea and applying it to business in general, there tends to be two steps in the “assembly line”.

There’s “production capacity” and there’s “market demand”.

i.e. “how many clients you can serve” and “how many clients do you have?” 

If you can serve 30 clients a month, but you’ve only got 20, then market demand is your “constraint”.

On the other hand, if you can serve 30 clients a month, and you have 40 people wanting to do business with you, production capacity is your “constraint”.

“Steve, enough of the theory, what can I do about it?”

If you have a marketing bottleneck, then the solution is to improve your sales and marketing.

There are many ways to do this. Here are just a few of the cheapest and most reliable:

- Do more of what’s profitable. 

- Improve the marketing you’re already doing - if you can get a higher response from the money you’re already spending, the extra clients are free.

- Work on your sales conversion process so you turn a higher percentage of enquiries into sales (if you’re selling online, “enquiries” would be web visitors)

- Find additional products and services you can offer to your existing clients

If you’ve got a production bottleneck, then that’s a different problem altogether.

One obvious solution is to increase capacity by bringing in extra staff or contracting the work out.

However, if you can’t find the right people to handle the work, or you don’t want to take on staff, there are a couple of things you can do to make more money from your current production capacity:

- Firstly, you can increase your prices. You’ll make more per hour and you’ll probably find you can increase your prices and still have more business than you can handle.

- Secondly, if you offer different services, you’ll find that some of them give you higher returns for your time. If you focus on those, you’ll get a higher return for your time without doing more work.

Best wishes

Steve Gibson

If you’re like me and spend too much time watching TV, you may have seen this:

link to really dumb ad

I’d love to see the research the agency took to Ford to justify their idea.

I can only imagine it went something like this:

“When we interviewed Ford dealers up and down the UK, we kept hearing the same thing: prospects are asking ’that’s a nice looking car, but does it double up as a French horn?’

“This lack of dual functionality is a deal breaker and costing you £millions in sales each year.

“Therefore, we believe the key selling point of the new Focus is that it can be disassambled and turned into a number of different musical instruments.

“If you focus on that benefit in your ads, you’ll dominate the car/instrument combi market and success will follow as inevitably as night follows day.”

It’s the only way I can imagine they could have pitched this.

Unfortunately, I’ve no way of figuring what was going on in the heads of the Ford execs that made saying “yes” to that nonsense seem like a good idea….

Steve