What the Photo of the Year will tell you about yourself

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This photograph has flooded the internet. Taken by Germany’s Jezco Denzel at the G7 summit (June 2018) it captures an image that strikes at the heart of the cultural chasm ripping nations apart.

If you haven’t seen this picture yet, try and caption it with one word. What would you say?

From all the memes I have seen, it basically boils down to two things. People focus on Merkel or on Trump and it is either positive or negative. E.g. if you focus on Trump you see ‘petulant’ or you see ‘defiant’.

The challenge to set yourself is this: whatever your response was, can you see the ‘other side’? E.g. if you focused on Merkel in a positive way (= strong woman making a case), can you focus on Trump in a positive way (= confident man not being intimidated)?

If you (for instance) look at Merkel and struggle to see anything but a ‘bossy woman’, or look at Trump and struggle to see anything but petulance, you are wrestling with your biases.

Our biases are so powerful and operate at a base level of cognitive processing that it is (a) hard to recognise and (b) even harder to change.

Lessons to take from this:

  • We all have biases

  • Biases are powerful

  • Biases are not recognised by the individual

  • Biases are cannot be changed (by others) through persuasion

  • Biases cannot even be changed by yourself (or with great difficulty or under exceptional circumstances)

In sum; we are all victims of our own biases, and forever more stands in the way of mutual understanding, peace and acceptance.

Why do retailers do the obvious things wrong?

I have been prognosticating about eCommerce for more than two decades. On balance I have been mostly right. But this is not about that, and I’ll explain shortly. First some context and some examples to set the scene:

Back then Y2K loomed large. YET to be launched was MySpace, Wikipedia, Facebook, Dropbox, Kindle and pretty much every organisation that dominates the internet today. In fact, 2000 was the year the dot com bubble burst.

I helped launch the first internet venture (Compuspace) in 1997, a year before Google Search and PayPal. This piece was written in Feb 1999.

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I have been writing on Inside Retail (Australia)on this topic for 8 or 9 years, so my record is in the open.

And it got me thinking about whether I was lucky or smart or whether there was something else.

Unfortunately, it is the latter. (I am smart enough to know I am not smart enough.)

Consider this case study on Lend Lease - a previous employer.

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My conclusion in a paper I sent to the executives snipped from my archives below. In short, I advocated that they DON’T play the eCommerce game (how did they go for any of the Landlords who tried?) – but instead to focus on ‘infrastructure’. That is, focus on logistics, focus on owning the routers the cables the switches and to own the highways and the portals of the internet – whatever that may look like; and NOT try to be a ‘retailer’.

Where would Lend Lease be if they listened in 2000 and spent the bounty received for MLC on internet infrastructure? (Cisco Systems traded at around $15 at the beginning of 2001 – after the dot com bubble - and at around $45 in 2018. A bit better than Babcock Brown.)

The modern take on this would be to be the ‘platform’ rather than a player or an aggregator.

Not one landlord (to my knowledge went there) but then again, Kodak did not become Flickr, Encyclopedia Britannica did not become Wikipedia and so forth – so there is a proud history of great companies not doing the obvious things.

This post is not (much) about MY perspicacity, but to pose a serious question. 

A misreading of this article would be to conclude that I am (humble-)bragging. I am setting the context because I want to illustarte that I am not being a wise-ass after the fact.

If someone with no special skills, no special training, no special insight living in a third world country (at that time) could 'know' these things; why do organisations not embrace/ address the obvious? They had to be reasonably obvious to MANY others, and they had fancy strategic planning departments doing the heavy lifting. Now that these things have come to pass, companies are surprised - and go broke – having failed to address what is obvious.

The key to being smart about the future that will play out boils down to this: understanding the difference between things that are fundamental and things that are transient. Any trends/ shifts/ technologies that enable the fundamental attributes or needs of people are bound to succeed and if not, likely to fade as a fad.

There are more than these, and Maslow’s hierarchy is a good starting perspective, but consider for instance that people are:

-          Social beings (status conscious, self-expression, interaction)

-          Selfish beings (see comfort, seek self-advancement)

-          Insecure (demanding, needy etc)

-          Inquisitive (learning, experiences etc)

In the light of the above, you can judge whether these ‘trends’ likely AR or CRYPTO are likely to last or fade.

I guess many people look at the same things and come to the same conclusions.

Why do companies then NOT respond to the obvious shifts that tap into the fundamentals of human nature?

In my concluding remarks to those Lend Lease executives, I made what I believe is to be an important observation: focussing on the present customer needs stifles innovation. Steve Jobs said something similar – the customer does not know what they want. (“It is hard to design by focus groups because most of the time people don’t know what they want until you show it to them.”)

Managers focus on the present because the present is where bonuses are paid. That is why:

•        Cabcharge did not become Uber

•        Holiday Inn did not become AirBnB

•        Blockbuster did not become Netflix

•        Sony did not become Spotify

And given what I already said about the fundamentals attributes of human beings, managers too will always look out for themselves first, and consequently lazy, present-focussed incumbents will always be replaced by hustling, future-focussed newcomers.

There are ways to avoid premature demise of great institutions, for instance:

1.      Boards should structure their remuneration practices to reward future-focussed innovation. (Including rewarding worthy failure.)

2.      Companies should stop focussing on ‘wellness’ and ‘diversity’ initiatives (for their own sake) because social engineering is not the mandate of a business. (There is a better way.)

3.      Strategic plans can almost entirely be scrapped, but at the very least should treat competitor behaviour as irrelevant.

4.      Throw most of your qualitative market ‘research’ in the bin.

Will ANY corporation follow this advice? No chance whatsoever.

In fact, here is a test: The more outraged readers are with these suggestions, and the more strongly convinced they are that I am wrong will be an exact indicator of how committed they are to popular tropes and memes and consequently how wedded you are to the present/current zeitgeist as opposed to being open to a different interpretation of the future.

And that is why - eventually - a new Netflix will replace the Old Netflix.

I finally figured it out

When I say 'figured out' I mean more than before and not completely.

I have the qualifications, but don’t think that taught me much about understanding people.

I profess to be a Christian, but I am not sure I understood what the Bible teaches about people.

I am older and experienced, but I am not sure I have really understood people despite all those opportunities over all those years.

It took a casual line from a movie actor and a trashy, unmemorable movie (Wallander) to have taught something about human nature that all my learning and all my faith could not. Not these exact words, but something like this:

‘If you want to know why someone did something, just find out what they loved more’.

If you want to know why people screw up. If you need an explanation for why people sin. If you are curious about why people fail or succeed. If you want really understand people and make sense of the apparent contradictions. Then look for this one thing:

What do they love more?

  • Why would an honest man commit a robbery? Because he loved money more than integrity.
  • Why would a young girl fall for a loser? Because she loves hope more than truth.
  • Why would a 30-year old live at the family home? Because he loves comfort more than dignity.
  • Why would a person do a job they hate? Because they love security more than purpose.
  • Why would a woman live with an abusive husband? Because she loves being needed more than being loved.
  • Why do people vote ‘democrat’/ ‘labor’? Because they love the idea of charity more than independence.
  • Why is there such a thing as a ‘struggling artist’? Because there are people who love creative expression more than financial gain.

I could go on, but you get the idea.

If you really want to find out why people behave they do, find out what they love the most. Or at least love more than the alternative.

People are motivated by what they believe (faith) only in part and are motivated by goals (hope) only in part, but the one motivator that stands above all is love. (1 Cor 13:9-11 paraphrased.)

In the life choices we make, we should make an honest attempt to discern what we love most in order to see what motivates our decisions.

If you choose to go the gym, but you love vanity more than health, it will probably not work as well. Your marriage will fail if you love yourself more than the person you marry.

We  fail at our jobs if we love pleasing the boss more than doing the right thing.

Because clearly we all love the wrong thing at least occasionally. And knowing when it is so, will enable us to live more wisely.

And that applies to me as well.

  • Let me count the ways in which I love wrongly:
  • I love writing about people more than I love people.
  • I love thinking about business more than doing business.
  • I love the idea of being rich more than working for money.
  • I love being right more than being popular.

That is not the full list, but those are the ones that have caused me the most anguish. I wish I had figured that out sooner.

Do not pass GO

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Why are retailers failing at such an alarming rate?

Assuming a few basic presuppositions are not the issue, there is one compelling reason that is evident in most failures.

The preconditions for any business to be successful are:

1.      Is there a real market need that I understand?

2.      Do I have access to a product or service address that need?

3.      Am I sufficiently equipped (skills, resources, motivation etc) to address this opportunity in a particular way that provides me with a competitive advantage or at least desirable point of difference?

No 1 and No 2 are usually not the issue because failure is quick – if the business even succeeds in getting off the ground.

The root cause of many failures can be found in HOW the retailer chooses to play the arbitrage game of tapping into a supply to meet a need.

That is, entrepreneurs will pick the way in which business is done (proposition delivered) and attempt to build some differentiation around that that can be defended at a profit.

1.      Timing: First or Faster

An example would be Zara that aims to bring the latest fashion (from the catwalk to the store) in less than six weeks – and if anecdotal reports are to be believed have done so in a matter of days. Or you can be the Concord. Or the movie house that shows all the premiers.

2.      Leverage:  Add value, minimise cost

Someone turns raw meat into patties, someone solves the challenge of distributing fuel to every town in every country. Someone is the cheapest, someone figures out how to make things smell better, work differently, last longer or taste better. We are limited only by our imagination and the possibilities of innovation are endless. Of course, any particular innovation can be made redundant in a flash.

3.      Change:  Adapt, Transform, Improve

More than simply adding value, there are opportunities for entrepreneurs to transform products completely. Old tires can become road base. Cars can be turned into supercars or transformed into vehicles for mobility impaired people and clothes can be altered to fit. Wind can be turned into electricity.

4.      Access: Exclusive or Convenient

Businesses also exist on the premise that access to the product/ service is exclusive or particularly convenient. This is a very typical ‘advantage’ that many smaller retailers rely on, and it is most often also their weakness. E.g. to be the only menswear retailer in Yepoon or the only newsagent in the shopping centre, or maybe even the only convenience store on that particular side of that particular city block leverages ‘access’ as the method of arbitrage.

Most small, product-orientated retailers tend to rely on the ‘access’ angle to create a POD. Retailers tend to be resellers, so innovation is not a primary focus. The only value-add lies in the bulk-breaking activity. These SME retailers are content to be ‘the only shoe shop’ in the mall as their core proposition.

In the past this has been a legitimate approach to ‘capitalise’ on an opportunity. There has always been limits as to how far people would travel to gain access to a product, so geography-based retail propositions have been viable since forever.

And, forgive me for stating the bloody obvious:

But, reliance on this particular approach is the reason why the technological shift in the market is causing serious competitive pressure. And being blind to the change that has occurred is the cause of many retail failures.

Too many retailers rely on the fact that they are ‘the only’ café on the strip, the only menswear retailer in a suburb, the only servo on that street.

If you only rely on being the only store in a particular geography, the internet obliterated that point of difference because on the internet geography hardly matters.

Everything that is for sale is in every customer’s pocket. And the time delay (caused by delivery requirements) are (a) offset by cost saving and (b) becoming shorter and shorter. In metropolitan areas, many eCommerce providers are providing same-day delivery and food delivery businesses do it in a matter of hours.

This leaves traditional corner-stores an ever-shrinking market comprising mostly of emergency shoppers or impulse buyers.

That is why Amazon poses such a threat to retailers – suddenly there is a competitor that it is more convenient and cheaper than your shop on your corner, and you can do very little about it.

Geography is irrelevant on the internet.

The only appropriate response is to change your execution. You need pick a different propositional dimension to differentiate

HR Departments have reached their use by date

This is a post that serves no purpose other than allowing me to vent.

Before you come with the pitchfork; this is not aimed at any individual. I have met some nice HR types, and I am sure there are many. But HR as a job category is an idea that must die.

I believe CEOs and boards actually recognise that people problems are relatively intractable, and as evidence I offer to you their typical solution: The HR Department.

Beyond the administration of payroll and recruitment tasks, these departments represent a tacit acknowledgement buy the Board that the people problem is in the ‘too hard basket’. This may be a contentious claim, but so as not to digress, here are my arguments for this claim:

-          When a ‘problem’ is outsourced to a group of people who have no authority and no power and no real ability to fix the problem, I would suggest there is no real expectation that the problem will be solved.

-          How many CEOs have come from HR?

-          The only reason why HR are still around is because of a complex legislative environment (a government requirement) that requires some dedicated focus to navigate.

-          No good manager will rely on HR to make an appointment in their department without them vetting the candidate, so their role is limited to merely filtering the noise for the sake of convenience.

-          HR can’t conduct performance reviews and can’t improve performance, and are restricted to writing increasingly more rules, providing templates and persuading boards of the benefits of compliance that largely serve to entrench their own positions.

-          When was the last time an HR Department played an active role in dismissing a CEO?

-          What percentage of HR solutions are ‘more training is needed’ – and who is then expected to organise said training?

-          One of the few quantifiable metrics in people management is labour turnover. In most organisations, who is held accountable for the actual percentage? Not HR – they will report on it and blame operational departments for the problem, and offer training to help address it.

-          Why are HR Departments jumping on social justice causes that exist in society when the employees they are meant to serve would come from the full spectrum of views on any particular cause? Arguably, picking sides would represent not only be unproductive in terms of the core business, it is also a breach of the trust that should be fostering in the employer-employee relationship.

-          What would happen to an organisation if the HR Department did not exist and these activities were carried out by the line managers? And, how many HR initiatives would survive if it relied on being championed by busy line managers?

-          They perpetuate questionable practices by introducing psychological instruments that have often already been proven wrong, or at best have not been proven – often at great expense to the organisation, in misguided effort to justify their existence.

-          Does any employee actually believe that what they tell a HR representative in confidence won’t reach their line manager – or another senior manager?

I am not alone in my views – here is a very articulate one to read before you comment in anger. I really like this line: “ HR is like an aberrant traffic cop now; it can often say “stop” but can’t really say “go.”

 

 

There is a Cathy in all of us

I don’t believe it would be contentious to make the following claims, as there seems to ample scientific evidence that they are true – at least to the extent that any social science can make a claim for truth.

Whilst, in the spirit of full disclosure, I would admit that I am judging anyone who engages with the world in this way; my personal judgement is not relevant to the observations that follow, so for the sake of the argument let’s just assume that how people choose to interact (more or less intellectually) is neither here nor there. If you think reading WHO magazine is a desirable form of life engagement, then that is okay.

People generally make decisions that are influenced by unconscious biases. More specifically, people make buying decisions largely based on emotional factors, only to rationalise those decisions afterwards.

Most people don’t seem to think deeply about the world – as there is very little evidence that the average person (whatever that may mean) engages philosophically with the world around them. Judging by what is popular in music and art and entertainment and even news; once would be har-pressed to make an argument to say the general population is overtly interested in intellectual pursuits.

Given the overwhelming evidence that we don’t really think – but rather respond to emotional stimuli – we (myself included) are effectively closed-minded.

But, if you want to understand what it looks like when even smart people have a closed mind, then watch the interview Cathy Newman had with Jordan Peterson.

I am not sure how many people are aware of Peterson and this now infamous interview, but even if you are not, maybe especially if you are not, and even if you are not interested in the particular topic under discussion, you can learn something about how a closed mind manifest itself in the real world.

This is how one commentator described the interview:

Peterson, backed by decades’ worth of research and experience, and now with dozens of hostile interviews under his belt, is hard to faze. Where the average guest is routinely bowled over, flattened or burnt to a crisp, Peterson stood fast, stated facts with precision and patience, and let Newman’s credibility shatter against him. You have to wonder if she’ll ever utter the phrase “so you’re saying” again without blushing.

Watch (if you haven’t) and try keep an open mind:

PS: At first glance a talk about gender/diversity/free speech may seem odd for a business blog - but the purpose here is to expose how we don't think the way we think we think.

Differentiate and DIE

Differentiate and DIE

We can learn something from the rules of the wild.

Biologists studying zebras in the wild discovered something that flipped all their assumptions.

They watch the zebras, but they look down at their notes and then look up they got confused about which zebra they were looking at because the striped camouflage is actually protection for the herd. The scientists solved this by dabbing red paint on the horns of the zebra or tag it with an ear tag.

 

Then they discovered an amazing thing. The predatory lions would kill these painted zebras in disproportionate numbers. As soon as it became identifiable the predator, the predators could organize their hunt to target the specifically tagged animal.

 

The the old idea that lions and predators take down the weak animals, but they don't; they take down the identifiable animals.

Most marketing gurus will tell you that the secret to success is to differentiate. There is no dearth of literature on ‘point-of-difference’ and how crucial it is to survival and success.

Read More

The Children are in Charge

I spoke at the WA Property Conference a few years ago. One of the topics I identified was the increasing ‘INFANTILISATION’ of Society.  From time to time, I like to check back on myself to see if I was on the right track – and yesterday I came across something that seems as if I was.

I am not a regular TUMBLR user, but a link led me there yesterday, and the ‘homepage’ struck me as particularly infantile. Check it out yourself. Here is a snip anyway, but the whole thing is pretty much GIFs and cartoons (visually) and you’d have to scroll for a long time before you found anything that could be of interest to a mature adult.

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For those interested in the TL/DR version, here is an extract from my eBook on the topic:

***

The manifestation of infantilism is not prominent in current business literature; possibly because it is not popular to do so for the bloggers and journalists. To me at least, the evidence of increasing infantilism is over-whelming. I deviate from the dictionary[i] definition which states: A state of arrested development in an adult, characterized by retention of infantile mentality, accompanied by stunted growth and sexual immaturity, and often by dwarfism. I am referring exclusively to the behavioural aspects and not the medical/ physical manifestations.

It is possibly no surprise that one of the biggest TV cult hits at the time of writing is Arrested Development. While the show was cancelled in 2006 after a few seasons, it was revived to much wider acclaim in 2013. (In 2011, IGN[ii] named Arrested Development the funniest show of all time). That to me seems indicative of it possibly being a tad early for its times and the ‘we generation, infantilism found its mark after the pendulum had swung a bit deeper into the current social era.

Web 2.0 Logos

Business names of the Web 2.0 era are almost without childish and infantile. From the funky, primary colour schemes and fat fonts to the made-up names everything is strongly reminiscent of baby talk.

Flickr, Prezi, Box, Pipl, Plinked, Pownce etc. is not too dissimilar to coochee coo that adults will turn to when talking to babies.

SMS language & emotional expressions

There is no need to explain the meaning of LOL or Gr8 to anyone. Nobody blinks an eye when today becomes 2day. Whilst it may have been necessitated by physical limitations of SMS messages, the conventions have found their way to other forms of communication where those constraints did not apply which suggests that it found fertile soil.

Some linguists might argue that this is a normal evolution of language, and others would describe[iii] this new variety of language, texting () as "textese", "slanguage", a "digital virus". According to John Sutherland of University College London, writing in this paper in 2002, it is "bleak, bald, sad shorthand. Drab shrinktalk ... Linguistically it's all pig's ear ... it masks dyslexia, poor spelling and mental laziness. Texting is penmanship for illiterates."

I believe there is consensus that this transformation has been more rapid, and more profound than any previous single shift in language use and this can be attributed to these seed of change falling on a soil that is particularly suited to such infantile linguistic conventions.

Gamification

Whether it is Commerce, Art, Education or Health, there does not appear to be an industry that is immune to Gamification.

Gamification[iv] typically involves applying game design thinking to non-game applications to make them more fun and engaging. Gamification has been called one of the most important trends in technology by several industry experts. Gamification can potentially be applied to any industry and almost anything to create fun and engaging experiences, converting users into players. (From)

Behind all the pseudo-science talk, it is worth remembering that Gamification is essentially about playing games.

Entertainment Software Association[v] reveals some telling statistics, which reinforces that games are popular and that Gamification of everything is tied to the social and technological shifts discussed elsewhere. The average gamer is 30 years old and has been playing for 13 years. Sixty-eight percent of gamers are 18 or older. Forty-five percent of all players are women. Today, adult women represent a greater portion of the game-playing population (31 percent) than boys age 17 or younger (19 percent). Sixty-two percent of gamers play games with others, either in-person or online. Seventy-seven percent of these gamers play with others at least one hour per week. Thirty-two percent of gamers play social games. Gamers play on-the-go: 36 percent play games on their smartphone, and 25 percent play on their wireless device.

Infographics

Whilst data visualisation itself is not new – and can arguably be traced back to cave paintings – it is worth noting that data visualisation has always been direct; e.g. the slice of a pie-chart was proportional for the dataset or the heights of the bars in histograms had a direct quantifiable relationship with all the other bars. Infographics have proliferated steadily over the last several decades, but it is only the last decade with the advent of specific software tools (to create) and software platforms (to distribute) that Infographics, as we know it, have exploded.

Infographics have introduced an indirect, narrative element to the data story – to the extent that it is has made the picture childish. This is usually exacerbated by the colour schemes and fonts (again a very Web 2.0 design language). For example, a simple stack diagram won’t do, it must now be filled with jelly-baby figurines to highlight that the bar might be referring to people – instead of simply writing the word people on the relevant axis. (Image[vi]).

Reality TV

It is generally believed that reality TV has boomed since 2000. Some interesting statistics[vii]:

Americans spend 1/3 of their free time watching television and of that 67% are reality shows and the number of shooting days for reality TV in Los Angeles rose 53% in 2012, making up about 40% of all on-location production and it now constitutes 57% of all television shows in the US.

It is appropriate to represent some statistics as an easily digestible infographic[viii]:

Presentism

Strictly speaking presentism is a philosophy where presentism is the belief that neither the future nor the past exists. In this context, I am applying less rigorous (non-philosophical) definition to refer to a general attitude that reflects short term orientation, including the desire for instant gratification and a disregard for the long term and the distant future.

This is no more cleared by the apparently whole-hearted embrace of the infantile, presentist philosophy appropriately referred to as YOLO – You Only Live Once. The disciples of this particular religion do not embrace that philosophy as a matter of self-evident truth, but rather proffers it as an excuse to do stupid stuff. (Jack Black famously quipped that YOLO is Carpe Diem for stupid people. I take from that whilst there is a metaphysical dimension to Carpe Diem, YOLO is seen as an excuse for stupidity – and is explicitly defined as such by the urban dictionary.

[i] http://www.thefreedictionary.com/infantilism

[ii] https://en.wikipedia.org/wiki/IGN

[iii] http://www.guardian.co.uk/books/2008/jul/05/saturdayreviewsfeatres.guardianreview

[iv] http://www.gamification.org/wiki/Gamification

[v] http://www.theesa.com/facts/gameplayer.asp

[vi] http://designreviver.com/inspiration/30-of-the-best-infographics-that-effectively-showcase-data/

[vii] http://anhoward.wordpress.com/the-effect-reality-tv-is-having-on-us-shocking-statistics/

[viii] http://screenrant.com/reality-tv-statistics-infographic-aco-149257/

Is offering Free WiFi a smart strategy?

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Before a mall (or a retailer for that matter) decides whether they install free WiFi for the public, there are a few factors to consider and it is not right for everyone.

Customers want it because it will help them save time, be flexible, increase productivity and stay connected with their world, but, there are risks and other factors to consider

1. Know it is a double-edged sword

There is a risk that customers will shop around other retailers without moving- comparing prices with competitors online.

Also, people expect connectivity and connectivity can increase satisfaction. since it can - if it is not fast enough for instance - be a cause of ongoing complaints.

By offering free WiFi, you also take on an indirect responsibility for the security of the data, whatever the fine print says.

All of these risks can be mitigated by choosing a reliable supplier.Most of us have probably installed our own Wi-Fi at home, so it does not seem to be a reason to get third parties involved, but that would be a major error, considering the risks and the benefits.

There are a few providers in Australia, Skyfii being one of the largest who have experience in malls in particular and also Aruba. Choosing a reputable operator allows you to access (and potentially benchmark) insights. Every year, according to Skyfii, they can analyse 300 million visitor experiences using existing WiFi infrastructure, BLE beacon networks, door-to-people counters, video sources, web and social platforms, and bring all of that together in one application.

2. Don’t do it because it is cheap

And don’t choose your partner solely on price. Cost is negligible for a regional mall. But you don’t do it because it is cheap, you do it because it will make you better. The reliability of the service, the detail of the coverage, and most importantly the depth of the analysis are far more important than cost of initial set-up.

3. Invest in infrastructure ONLY if you will invest in using the data

The key is offering WiFi can allow you to gather data. (Hence choosing the right partner.)

Wi-Fi is not installed simply to provide a free service for customers. Wi-Fi for customers supplements the traditional loyalty card. People think loyalty cards are a mechanism for points, but actually it’s a mechanism for gathering data about the customer. WiFi does that, but is also able to add contextual information such as how people move through the store or the mall.

With a good provider and with a sound strategy, mall owners and large retailers will be able to change the way they do marketing:

  • Data capture: Capture customer information through your Guest WiFi’s registration page.

  • Configurable templates: Customise your registration page and other customer forms.

  • Progressive profiling: Schedule subsequent questions with each login at the captive portal to capture additional data.

  • Content delivery: Deliver content like welcome emails, SMS, Video and customer landing pages.

  • Multi-venue configuration: Configure your Guest WiFi based on a single venue or multiple venues.

  • Social login: Provide users social login options including Facebook, Instagram & Twitter.

  • Foot traffic: Measure unique visitor counts and identify your peak visitor times

  • Smart Zones: Use geo-fencing technology to define areas of interest for analysis

  • Visitor flow: Visualise the most travelled paths and popular destinations in your venue

  • Wi-Fi Activity: Measure sessions and analyse which sites customers visit using Wi-Fi

  • Conversion: Analyse the conversion funnel for your venue, from passerby to till

  • Heat-mapping: View visitor movement in real-time on your venue map

  • Dwell Time: Understand how customers spend their time and engage with your venue

  • Attribution: Segment visitor activity and traffic to analyse the impact of marketing campaigns. I.e. being able to ‘attribute’ your traffic to the right source.

Like so many things, there is a temptation to adopt new technologies because they are new technologies. That is not smart. But WiFi (and Bluetooth and NFC) technologies are increasingly being integrated into our lives, and I can only see reasons to install WiFi becoming increasingly important.

It may seem futuristic right now, but for instance, consider this:

  • Most cellular networks are now adopting WiFi-enabled calling, and this way you can guarantee consumers don’t have to suffer poor mobile reception in your centre.

  • When people start paying with cryptocurrencies, they need network access to their digital wallet.

  • How will the Internet of Things play out?

  • Could it impact how children are monitored (and not lost) in the mall?

No one knows for sure how everything will play out, but what we do know is that there is data in your future. The key takeaways, therefore are:

First, have a strategy, second, pick a good provider and thirdly, keep iterating and keep learning. Fail forward.

Have Fun.

(Image: http://dailypicksandflicks.com)

Why I don't believe in myself (the day before my birthday)

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There are advantages to having a closed mind: you will never doubt.
There are advantages to being indecisive: you will never make an error.
There are advantages to not loving: your heart will never get broken.
There are disadvantages to strategic planning: you miss the opportunities you did not expect.
There are disadvantages to doing research: people can’t tell you what they don’t know.

There are pros and cons to many perspectives that are almost universally believed to be ‘good’ or true.

None more so than the universal command that we should ‘believe in ourselves’.

It is meant to be motivating, it is meant to fuel a belief that will keep you going when things are tough.

But in truth, it is completely erroneous and misleading.

Think about it for a moment: is the ‘belief’ in your head (or heart) actually connected in any real, meaningful way to the outcome that you are supposed to believe in?

Consider the example: you are stumbling through the desert. All alone, no tools, no water. It is just you in a hundreds of kilometers of sand. Things are dire. WIll you make it or not? 

The facts are: you will make it if you keep going long enough to get to water or help, or the help or water comes to you.

Conventional wisdom would hold that this would be the time when you should believe in yourself. Things are grim - have faith in yourself.

But no amount of belief in yourself will save you.

The walking will save if you do it long enough to get to the water. Not the belief.  You may ask whether the belief will keep you walking? I doubt it very much. 

What keeps you walking is fear of dying, not the self-affirmation in your abilities. You need to believe that you will be saved if you keep on  walking; not so much that your are a great and wonderful person that is capable of anything. Believe the benefits of (keeping on)  walking, not in your ability to walk.

If you are a poor manager with anger issues, belief won’t fix it. If you lack ‘coding skills’ to become a good programmer, it is more learning that will get you ‘there’, not the belief in yourself. 

You should actually believe (the reality) that you are not that good and keep learning.

You should actually believe (the reality) that you will die without water and keep walking.

Recognising the reality is real motivator, not belief in yourself.

If you want to believe - and I think we all need to - I would suggest you find something more inspirational, maybe even something transcendent to believe in.

Groucho Marx’s letter of resignation to the Friars’ Club read: “I don’t want to belong to any club that would accept me as one of its members.”

It is something like that: if you are going to base your belief in something, make it something worthwhile that could actually make a difference.

I hate to sound cruel, but the reality is that half the population is less than average on any metric that matters. No amount of belief will change that. There are two groups of people who peddle this to you:

  1. Self-help authors a profit from persuading the bottom half that they could be the top half - if only they believed (- and here is the recipe in my book).
  2. Deluded people who self-identify as high achievers and want to tell you how they did it. The problem is, they suffer from either (a) the Dunning-Kruger effect, a  cognitive bias whereby people who are incompetent at something are unable to recognize their own incompetence, or (b) self-serving bias, which  is the distortion of cognitive or perceptual process because of the need to maintain and enhance self-esteem, or the tendency to perceive oneself in an overly favorable manner. That is: if things go wrong, someone else is to blame, if things go well, it is because I am so good. They must find a reason for their success within themselves (my intelligence, my persistence, my actions, my attitude).

Reality is a lot more complicated. All people who succeed, believed in themselves, but all people who believe in themselves don’t succeed. Belief is present in success, but success is not contingent upon belief. Just like breathing is ‘present’ in all successful people, all breathers don’t succeed.

Believing in yourself sets the bar very low.

Better to have a firm grasp on reality, believe in the (science of) consequences that follow from actions, believe in (the spirit of) God, or believe in the purpose you have set. 

But belief in yourself? Maybe not the smartest thing you can bet on...
 

Should your business 'take the knee'?

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Well, should it? Or to put it differently, the purpose of profit may not be what you think.


Colin Kaepernick has dragged the NFL into the daily media narrative by refusing to stand for the national anthem. Tony Abbott et al have accused the NRL of dragging politics into sport by having Macklemore singing ‘Same Love’ at the Grand Final.

What role should business play in socio-political issues?

To answer that question, we have to ask what the purpose of business is. The simple response is that a business must create a profit for its shareholders. But, there is a catch:

The purpose of profit is not what you think.

Most businesses make 5%-10% profit, to distributed to its shareholders. And the other 95% of its money recycles effectively through the organisation to allow it to keep going.

That is, if the organisation spends 95% of its revenue on sustaining the organisation (with only 5%) leaving the organisation more or less permanently, in practice a business exists to feed its employees. (Even if half of that is spent as COGS, it is still an act of recycling funds in order to keep going.)

Now before you think I have gone all Marxist, just hear me out: 

Most people believe that we have come a long way since the robber barons of old filled medieval factories with indentured labourers; what with fixed salaries, executive perquisites, bonus incentives, and not to mention a panoply of ‘programs’ for the people like:

  • employee recognition
  • engagement
  • workplace improvement 
  • or whatever #hashtag there is to celebrate. 

On the negative side, you get people abusing their privileges:

  • stealing office stationery 
  • accepting kick-backs
  • taking ‘sickies’
  • or more insidiously, postponing (or timing) capex or investment decisions to boost short-term performance so that the results ‘on your watch’ look good

It seems to me that it is a commonly accepted fact that people know and act as if the company exists for them and they may feel they are not getting what they deserve. What we have on display in most organisations is the economic reality that the modern organisation exists primarily to sustain the business, and that the practical reality that people in the business act accordingly.

And that might well be the kiss of death.This may seem to be a counter-intuitive position, so please bear with me.

Whilst it is true that almost all funds are cycled into the business in order to sustain the business and its people, this should not be the objective of the organisation. 

When you start focussing on the system of business for the sake of sustaining the system, paradoxically you diminish the sustainability of the business. And since all businesses fail (eventually) it seems as if no one is immune to this distraction.

When celebration of the employee and the culture becomes the ‘purpose’, the organisation is doomed. 

I am not suggesting that employees are not important and that they should be treated poorly.
But when anything but shareholder returns becomes primary, it is a sure indication that an organisation has lost/ is losing focus. (I am not saying that employee needs are not important; quite the opposite. They ARE, but the question is how do you meet those needs sustainably.)

That 5% return that finds its way to the shareholder, whilst only a small portion of the total, is the ONLY portion of funds that are external. That 5% is the objective, ‘north star’ by which you can navigate BECAUSE it is outside the system.

When an organisation starts making decisions and taking actions that based on what is best for the system by referencing what is IN the system, it become self-referential. You cannot make good (objective) decisions by being self-referential. 

You don’t achieve your primary objective by focussing on your secondary objectives.

Your SatNav can’t navigate your Mercedes by referencing the star on the bonnet, because it is part of your Mercedes - it needs an external point of reference.

I would suggest it is useful to examine many corporate activities in the light of this perspective. I am not advocating a return to indentured labour, and I am not saying ALL non-core activities and initiatives are automatically inappropriate.

But I would say a healthy, focussed organisation must thoroughly examine itself and the activities that are not directly related to driving shareholder returns. (And I mean directly - because if you draw a long enough bow, even having an office cat can be said to link to shareholder returns.)

I am not advocating for corporations to accept no responsibility for their actions and their role in society, but rather question some, now commonly accepted, corporate practices:

  • Should it really be the responsibility of an organisation who is comprised of a diverse range of people (employees and shareholders) with a diverse range of beliefs, to dictate what its definition of (say) ‘wellness’ is? 
  • Should an organisation (via the Executive) really decide which political party to support - when half the employees (and shareholders) are likely to support the other party?
  • Should the organisation decide which charity should be supported, or is it best to return the funds to the shareholders (or pay the employees more) and let them decide who they would like to support?
  • At what stage does the organisation’s engineering of employee interactions and ‘change management’ become manipulation? And who decides where the line is? 

It seems, if considered superficially, that there is always a justification to spend money (and it is easy to do if it is other people’s money) on some social/ employee initiatives (because of that 95%) but this would be an egregious error in judgement. 

Organisations must obviously comply with the law. Organisations have a duty of care to ensure no one gets harassed or is put in harm's way, and that might well be the full extent of it if you want to err on the side of caution.

When you take your eye off the ball (shareholder returns) no matter how ‘noble’ the alternative seems, the result is inevitably a dropped ball. When that happens, there is nothing to share, and worse, no job to go to and no one gets to appreciate the poster in the canteen that proudly proclaims that ‘we put people first’ when the organisation ceases to exist.

As employees and executives, we have one job: to leave the organisation in a position that allows it to provide purpose and employment for future generations. That is, we put current and future employees first. BUT - we achieve that by not treating the company like our plaything, and by not expecting it to cater to our every whim, but instead ensure it stays true to the external objective of meeting customer needs and rewarding stakeholders.

That’s all.
 

Image courtesy: http://www.theloop.ca/

The unvarnished truth about ecommerce failure

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What no one tells you about eCommerce Failure like Surfstitch: 10 lessons for bricks and mortar:

I am not an eCommerce denier. But I do have two eCommerce failures under the belt. So I can speak from experience. 

But rather than my failures, let’s consider the more spectacular story of Surfstitch. My son was a customer of theirs, so I also have some experience to confirm that Surfstitch had:

  • Great customer service
  • Good product range and pricing
  • A very nice UI/UX on the website
  • Good marketing

In short, they had EVERYTHING the gurus are telling bricks-and-mortar retailers they should get as a matter or life or death. Yet that did not work out so well for them.

SurfStitch had their IPO in 2014, and less than a year later, the share price had more than doubled, pushing market value beyond $500 million.

Surfstitch shares crashed in 2016 after a peak in 2015. CEO Justin Cameron bailed out in 2016, and the company issued three profit warnings and is facing the prospect of a $100m class action from irate investors.The reported loss totalled $155m for 2016.

While sales grew 7 per cent over the (2016) year, this was largely due to the spate of acquisitions. In 2017 Surfstitch went into administration, although the main online operating entity continues to trade.

Excuses that were offered included:
The period of rapid expansion (multiple acquisitions and two major capital raisings) involved significant management time.
The  focus on increasing market share, combined with difficult trading conditions – particularly in USA  – saw  margins slump from 46 per cent to 39 per cent.

Excuses that were NOT offered, but probably did not help:
Co-founder Lex Pedersen - who returned as interim chief executive saw his base salary for the year jump from $280,000 to $634,000, 
Mr Cameron's (previous CEO) had his base salary also increase from $220,000 to $561,000 in the eight months to his March departure.
Chairman Howard McDonald's total remuneration jumped 40 per cent from $71,950 to $100,903.

But what really happened?

To paraphrase Forrest Gump: Life is a box of chocolates. And Surfstitch got stuck with the leftover Cherry Ripes.

Of course it would be presumptuous of an outsider to prognosticate about the specifics, so let me generalise the lessons for any retailer in any channel:

  1. Money (capital) does not fix everything
  2. There is no substitute for spending less than you are earning: sales is not the same as profits, and without sufficient margin you don’t have a platform
  3. You can indeed grow yourself broke
  4. Hubris will kill any business: don’t drink your own Kool Aid
  5. Inexperience can only be cured one way
  6. It can’t cost you more to acquire customers than you make from them - at least not forever
  7. You can bulls&*t some people some of the time
  8. There is nothing more vicious than an aggrieved shareholder who had already visualised spending the returns
  9. All the metrics matter - except positive PR

And finally, and most importantly:
10. eCommerce businesses are not immune to all the issues that any other business faces. You have do all the same things ‘right’, and not do all the same ‘wrong’ things . And if you have an traditional retail business, simply adding eCommerce capability is in and of itself NOT a panacea. 

As JH Plumb wrote so eloquently in his treatise on The Renaissance:

Success comes most swiftly and completely not to the greatest or perhaps even to the ablest men, but to those whose gifts are most completely in harmony with the taste of their times.

That was true then (fifteenth century), and it is true today. And that is just the start. After that you have to execute. 

To fail at execution is to fail for sure.
 

(Image: surfstitch.com)

How to persuade people without changing their minds

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IT IS ALL IN THE FRAMING

You may not have heard of framing, but it shapes what you believe and how you act every day in every way.

Marketing gurus will tell you that the ‘new’ marketing is about storytelling. In fact, the old marketing is about storytelling.

Except, that it isn’t about ‘stories’ it is about ‘narrative frame’. This is how a paper from University of Southern California describes it:

A listener's psychological reaction to narrated events is influenced by how the narrator frames the events, appealing to different values, knowledge, and experiences of the listener.

If that sounds awfully academic, allow me to reframe it (simply):

People base their decisions today on their past experiences.

HOW FRAMES ARE CONSTRUCTED

People (over time) process their experiences in a way that forms the basis of what they believe to be true (knowledge) and what they believe to important (values). In this way experiences build on each other to create a mindset or worldview that has utilitarian value for the individual; he or she can use it to function properly in the real world.

New experiences are viewed through the lens of your existing worldview, and the ‘facts’ that fit best with the existing mindset are easily absorbed because they are deemed true. The trap we all fall into is that, new experiences that don’t fit with the existing mental models, are bent so that they are forced to fit.

We all do this bending of reality to fit our mental models, because we don’t have the mental capacity to objectively, systematically evaluate every experience, and to file it properly. The process is too slow for the real world, and it is psychologically uncomfortable and destabilizing.

This process is related to the idea of ‘bias’ but not necessarily the way it is often explained. A bias is not some ‘bad’ thing that you should strive to eliminate. (Here is a long list of cognitive biases.)

One such bias that people universally claim to be ‘bad’ and that should be avoided is (for example) stereotyping, which is expecting a member of a group to have certain characteristics without having actual information about that individual.

Whilst there is some benefit to gain from expecting the unexpected, and to give people the ‘benefit of the doubt’; most often people conform to stereotype. That is stereotypes have functional utility because they are usually true. By not having to wait for, or in the absence of any other facts, it is practical and expedient to assume people will conform to stereotype. It takes very limited mental processing capacity, which leaves you free to pay attention to other things. Stereotyping is a useful bias. Of course, there may be times with certain individuals where the stereotype does not apply, and it is useful to be able to recognise that. But the point is that, until proven otherwise, the bias has a purpose.

Biases are useful shortcuts (heuristics) that allow people to operate efficiently in the world.

It is very hard to change people’s biases.

This gives rise to another aphorism which has become cliched, but is essentially true. People will often claim ‘perception is reality’. Of course that is not true; reality is reality, irrespective of how it is perceived. But in practice, how people perceive reality leads to them acting in a way that is in accordance with how they perceive it, so it is a fair enough approximation to accept the statement is a useful proxy.

So, we have three considerations here:

One: People construct mental models to operate in the world

Two: Our biases influence how we stack more information on top of existing information, favouring the facts that have proven most useful and repeatable over time

Three: With our personal mental models thus constructed, we perceive the world in a certain way.

FRAMES IN ACTION

The way we perceive the world is through frames - and people have multiple frames which are contingent upon circumstances.

It is not easy to change people’s biases. It is almost impossible to change people’s mental models - their personal paradigm - but it is possible to persuade people by creating a specific narrative frame. Strangely, you are actually not changing people’s minds (that is almost impossible) but since people have multiple frames through which they look at reality, you can change the perceived reality by changing the frame.

Imagine someone is looking through a keyhole into a room. They see a man lying on the bed, and another person taking a knife to his chest and slicing him open. They might think they are witnessing a murder.

Imagine now you put a sign above the door that reads OR 3 with a red cross. They still witness the same (limited) set of behaviours, but now people are more likely to think they are witnessing a medical procedure.

People’s mental models and biases have remained UNCHANGED. There are certain behaviours that are good (life-saving operation) and there certain behaviours that are bad (murder).

It’s not a great analogy because you may tempted to think that the ‘persuasion’ worked because you simply provided more information (the sign above the door). Consider some real life examples:

For decades there was strong push to get abortion legalised. The arguments were framed as pro-abortion and anti-abortion. Looking at the issue through the lens of abortion made it very difficult for pro-abortionists to win an argument. People have certain biases and certain mental models; including that the ‘innocent shouldn’t be made to suffer’.

Over time, and I am not sure if it was by design or by chance, the debate was re-framed as being ‘pro-choice’ and ‘anti-choice’. As soon as this happened, the debate was over. Most people would subscribe to the idea that personal freedoms are important. Consequently the right to choose is important, and they accepted abortion viewed through that lense. People did not change their minds about ‘innocents not suffering’ - but they just looked at the debate as being about choice and not about suffering.

The same happens with the debate about same-sex marriage. Traditionally homosexuality was deemed a deviant behaviour and was ignored or covered up. (Those who refused to do so were said to ‘come out’.)  

As soon as the debate was reframed away from homosexuality (we are different) towards marriage equality (we deserve the same) the momentum towards allowing same sex marriage swung rapidly and decisively towards acceptance. Most people can identify with the importance and the inherent fairness of treating people ‘equally’.

Those opposed to same-sex marriage have attempted unsuccessfully to frame the debate as being about ‘political correctness’. That is because being PC is, whilst generally derided, not seen as a human right issue and therefore carries less weight - or what I like to call ‘persuasive valence’.

So much for the background. How does this apply to business?

THE IMPORTANCE OF A SINGLE WORD

One of the key ‘narratives’ that an organisation can create is through mass-media advertising.

Aldert Vrij’s (Detecting Lies and Deceit) describes the framing effect as follows:

Participants saw a film of a traffic accident and then answered questions about the event, including the question ‘About how fast were the cars going when they contacted each other?’ Other participants received the same information, except that the verb ‘contacted’ was replaced by either hit, bumped, collided, or smashed. Even though all of the participants saw the same film, the wording of the questions affected their answers. The speed estimates (in miles per hour) were 31, 34, 38, 39, and 41, respectively.

One week later, the participants were asked whether they had seen broken glass at the accident site. Although the correct answer was ‘no,’ 32% of the participants who were given the ‘smashed’ condition said that they had. Hence the wording of the question can influence their memory of the incident.

A bank may choose to frame their home-loan product as being ‘smart’ or as being ‘safe’. Or an institution may choose to frame their life-insurance products as being ‘smart’ or as being ‘responsible’. (Which would you choose as the most effective?)

THE RISK OF FRAMING FOR CHEAP

The interesting thing is how many retailers choose to frame their offer as being ‘the cheapest’ or value for money. These are valid frames, because consumers have a propensity to want to save money and they have a frame of not wanting to be ripped off.

There are multiple problems with this frame:

One: Several brands are offering the same frame, so it is crowded in front of that particular window. Competing on price is an option only if it is well-considered; but often it seems to be a lazy strategy applied inappropriately to the wrong product or market.

Two: The type of customer you acquire is the least valuable and most disloyal. It is a precarious business model that relies fully on price-conscious customer. I am not suggesting that it can’t be done (WalMart e.g.) but there are a number of other things that need to be balanced, one being that it is best suited to products or services that are commoditised, and the entire business model should cater to that type of business.

Three: The brand association is inherently negative, because.heuristic that applies to things that are cheap is that they are poor quality. You can say ‘value for money AND best quality’ as much as you like in your advertisements, it won’t change people’s minds because people have a bias to disbelieve what people say about themselves and believe the actions they take. I can tell you I am an honest guy as much as I like, but until you ascertain for yourself that I act honestly, you will tend to disbelieve it.

CONCLUSION

The best kind of persuasion is the kind that does not rely on people changing their minds. It is nearly impossible to change people’s minds, because they have constructed a mental model of the world that allows them to function properly in reality.

Instead of changing people’s minds, try and change the lense through which they look at the world.

You can do this by changing a word.


Image: https://www.flickr.com/photos/maumana/3714637604/

 

The Siren Song of Growth

 Image:  oopperabaletti.fi

Image:  oopperabaletti.fi

The roots of mermaid mythology varied.  In modern myth we tend to see mermaids as kind and benevolent to humans but not all stories go this way though. In these myths, mermaids would sing to men on ships, hypnotizing them with their beauty and song.  Those affected would rush out to sea only to be either drowned, eaten, or otherwise sent to their doom.

The idea of Growth seems hold the same powers as the magical mermaids of your. We are seduced by its siren song....

Its existence seems accepted.

Its desirability is assumed.

Its benefits implicit.

But is it?

It is undeniably true that nothing grows forever.

In fact, the trajectory of growth is something that goes like this:

Birth, Growth, Maturity, Decline

You may recognise that that is the Livecycle Curve I just described.

The only question and the only variable is ‘how long’.

So, decline and death is inevitable and inexorable.

Growth is NOT an unending upward trajectory.

So, if the END of growth is death, why are we so obsessed with growing?