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Stop this obsession with price-based competition and marketing
The 1107 words here lead to and underline some questions you can ask yourself about how you bring value to your customers and what you are going to do to survive market changes… It is a long rant and potentially a little naive. I’m not a financial expert and maybe not the best strategist. But still…
It strikes me that we live more-and-more in a world obsessed by price. Or rather: “Cheap”. Given “the current economic situation”, credit-crunch, budget cuts, unemployment and austerity measures, I suppose this is natural. People want to get the best for their money. But that doesn’t make it good. Since when did “the best” equal “the most for the cheapest”?
In my recent visit to the UK, I was shocked by the apparent extent of this obsession. Everywhere I went, everyone was competing on price. Supermarkets that used to offer the best quality food ingredients now focus on “3 for 2″ offers and “any 2 deserts for £2″. The motorway diners that used to boast “authentic fully-cooked English breakfasts all day” now have posters several miles before noting that “the whole family eats for £5″. And for some reason, my father has taken to supplementing a benefits-driven overview of his latest purchase with “…and it only cost me …”
But competing on price is not sustainable and doesn’t create a real value image in the long-term. Sometimes it can even destroy hope of having a long-term future, as is famously the case with HMV right now or, less in the public eye, the little DVD-hire-shop down the road from me.
Take the first example: HMV. The first HMV branded store was opened on Oxford Street, London, in 1921. Facing competition, it won the game by offering newer, bigger stores with the best most complete collection of music and film. When I was growing up in the 90s, if I wanted the latest number-1 CD I would pop into my local “Our Price”. But if I really wanted to shop for CDs, to find something a bit more obscure or to listen before I bought, I would happily wait for a trip to London to visit HMV.
In the example of my local DVD shop, it was all about getting the latest films first and the unprecedented offer of keeping them for 48 hours instead of the standard 24 rental hours. People who wanted to see something before anyone else would go there. And maybe even lend it to a friend before they took it back.
But markets change and in both cases these value-offerings came under attack from the competition. Facing the online offer of Amazon, iTunes, Napster and MegaUpload, HMV was no longer the only one to have everything in music and film. And the others were cheaper too. Instead of fighting back with any real innovation or added quality, prices were reduced. And as the bottom-line profits slipped away, gone as well were the listening-posts to “try before you buy”. The more expensive-to-run focus on specialist or obscure music was replaced by more of the latest number-1s at a cheaper price then anywhere else. My local DVD shop started to offer 3 films for the price of 2.
When competing on price alone, the cheapest wins and everyone else dies. Drug dealers know this and you don’t have to watch many mafia films to understand that the middle man always gets cut out. For HMV, consumers who could no longer see the added-value of a trip out to the shop (in the cold, using expensive petrol) would buy exclusively online. Everything being equal, price wins.
But everything doesn’t have to be equal and there are other ways to compete. In marketing terms, “price” is only one of the 6 “P”s and consumers might buy for any mix of reasons. HMV used to be about “products” and “people”. Another high-street shop in the UK claims to have the best KnowHow™ to help you install, maintain and use your product. * This is all about the “people” and “processes” they offer – a good reason to buy. In my own case, I currently focus on creating the minimum effective dose of training, along with authentic learning processes and improving formal learning with practical use of social media. Others focus on being the first to market, or the most deluxe product.
* Ironically, in my last trip to the UK, the window-sized poster- promoting this “people/process” offering was now obscured by 20 smaller shamefully off-brand posters shouting out the cheapest prices for X, Y and Z.
For the seasoned marketeer, I have said nothing new here. Its always been the same: Companies profit by offering value for money. Unfortunately, many companies seem to have forgotten all about the value, choosing instead to focus only on the money. They argue that its because of the tough economic situation and because no-one has any cash to spend. But even if the “boomerang generation” can’t afford to do live away from its parents, one look at the evolution of Apple’s share prices over the past 5 years will tell you that many people still have a lot of spare cash. Starbucks still makes £400 million in revenue selling coffee in the UK and Amazon has announced that its fourth-quarter revenues rose by 22 percent to reach US$21.3 billion. And despite training being the first thing to go when corporations aren’t making enough profit, many of my trainer colleagues are still fully-booked doing great business until the end of 2013.
People pay for quality. This doesn’t mean “top quality” or “deluxe” but simply “value” (or perceived value). And if you want them to pay you, then you need to offer value, whatever your price. The more value (and the more unique your value) the more likely people will buy from you. Despite the focus of so many on “price”, I believe that if you want to do well in bad economic times, you need to focus even more on the other side of the price/value equation.
So to close my little rant (“price competition” is after all one of my current pet-hates) I would like to ask you to take some time over the coming days to think about the following 5 questions:
- Everything being equal, price wins. But everything is not equal. What makes you special?
- What do you want your customers to say about your products, services and staff?
- What do you, your company, people, products and services stand for? What’s your “thing”?
- Assume money was not an issue for any of your customers. Why do they buy from you?
- Why do people come back for more of your stuff?
Thanks for reading.
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2012 Annual Report
To wrap up a very successful year and to welcome in 2013, this post outlines my major achievements for the past year.
Thanks to everyone who has supported me and helped me grow in results, in mind and in competence.
See you next year!
Business growth inline with previous years
- Revenue = 22.1% growth on 2011
- Number training days delivered = 108
- Number man/training-days = 1099
- Number NEW people trained/conferenced in 2012 = 1192
- Welcomed my 3000th training participant on Dec 13th during the Kluwer Management Assistant Day
Conference speaking became a more important activity
- Invited to speak in May 2013 at the ASTD2013 ICE in Dallas
- Designed and spoke at Epsilon SoMe conference – led to several wins
- Spoke at Epsilon Forum+ Conference 2012 on “Practical Use of Social Media for Formal Learning” + “Gamification for Learning” …sold out both sessions in the Foyer Royale of Aula Magna, LLN (+/-200pp)
- Spoke at twice Kluwer Trainer’s Lounge on “Social Media for Trainers”
- Spoke for Kluwer + Epsilon on my experience at ASTD almost immediately after the ASTD ICE
- Spoke for 35 Learning Managers of the Federal Government on the importance of a new way of learning in the new world of work
- Spoke at the Kluwer Meet + Greet in October on my experience at ASTD and “Gamification for Learning”
- Tractebel “NVC”
- Animated the of Ipsen 3I Academy Kick-Off conference
- Spoke at 2 conferences on the benefits of social media for engineers
- Got 17 managers of a large Belgian organisation to agree during a conference that professional usage of SoMe can bring added-value to their business
- Thanked by Kluwer for being an inspiration in their social-media evolution
Visited ASTD2012 ICE Denver, sponsored by Kluwer
- Met Tony Bingham for the first time – who also agreed to make for me a short film on the value of training
- Met Sarah Bloomfield , Snr L+D specialist from Google
- Met @LnDDave in a burger joint in Denver…
- Very successful live blogging from the conference – 725 hits in 4 days on my blog, which at the time was a record (see below for more)
- Most mentionned author in LnDDave’s back channel resource page ..
- One twitterer I met at Mile High Stadium said he could no longer refer to me as an “urban legend” (since we had now met)
Got new clients and did a mix of work, with some new colleagues
- Ran my 1st “open-calendar” training in May for “Presentation Skills” ..and set up second open-training for January 2013 for “Prezi”
- Did 2 brainstorming sessions – one on the use of social media for work productivity and one for a Belgian training company who wants to improve their offer
- New clients including Fed-Gov, Belfius, Demos, Ephec, Electrolux, Elia, Ipsen, Yara
- Continued with many of my own clients, particularly that large international food client who doesn’t like to be named, Interel in Brussels, The University of Gent, Kluwer and Cefora
- New prospects in the pipeline for 2013 look pretty solid
- Outsourced work to 2 new people and continued with one person from last year
- Delivered 56 days of training for Kluwer
- Massive upgrade of training with social media before, during and after
- Deliberate official use of last year’s NLP training in coaching activities with the logical levels method
Continued efforts with writing and different social media platforms to grow visibility and publish ideas
Blogging
- 23702 hits this year on my own blog (compared to 6800 in 2011)
- Hits per month over 2500 since October
- People start to comment and subscribe
- Named by Juana Llorens of ASTD as one of her “go-to resources”of 2012
- Guest blog interviews with Steve Gavatorta on Gen Y and Intergenerational Issues and Michel Schwarz on Happiness and Gamification
- Guested on Sarah Bloomfield’s blog and several times on Kluwer’s Learning Live blog
- Featured on the ASTD blog-site towards the end of the year
- Published my first rap :-/
- A LOT of hits every week for my post “15 Best Prezi Tips I Found Today”
Twitter, Facebook and LinkedIn
- 1268 followers at the time of writing (up from 303 end 2011)
- RTs and mentions are now regular, rather than a surprise from time-to-time
- Failed in my second attempt at a Twitter chat
- Starting to experiment with a Facebook fan page
- Continuous use of LinkedIn groups for Presentation Skills (50 members) and Leadership Foundation (86members)
Other writing…
- Published an article in ASTD’s T+D Mag December 2012: “Improve Formal Learning with Social Media”
- Started to write my book “Open” + my ebook “Build and Deliver Awesome Presentations” – expect an update soon!
…and that’s pretty much it.. …except for my pre-summer mini-burn-out, post-summer new work ethic, new motorbike and 14 weeks holiday
Learning narration
The guys from the Internet Time Alliance talk about social learning and it’s many aspects. One of those aspects is Harold Jarche‘s idea of “work narration” whereby workers take regular note of what they are doing and what they’ve learnt, sharing ideas, resources and references.. Typical work narration might take place via Twitter or LinkedIn or by using other in-company platforms like Microsoft SharePoint.
In my training, I encourage participants to narrate their learning over the course of the training. The following are some simple examples that are easy to implement and that when measured, show participants’ interest:
- As every trainer does, I regularly do Level 1 + limited Level 2 checks to see participants’ (reactions to) learning during class time. Using a variety of questions, we can see what different people take-away from the learning process.. this can sometimes illuminate things for other participants.
- I have started to use individual “profile spaces” in the training room, where each participant can regularly add her comments, likes/dislikes, post-it notes and other reflections. These are clearly marked with the names of each person and visible to all. The next evolution here will be to digitalise these spaces…
- For specific topics, I assign out-of-class tasks to encourage participants to search for and share references and reflect further on their own learning. An example of this can be seen in the “Flow wall”, used to narrate learning of the same-named motivational theory.
- When I started out as a trainer, I used to go back to participants by email several weeks or months later to ask them for more feedback on their learning + implementation of new competences. In the past years, this evolved to a surveymonkey.com follow up questionnaire. These days, I use LinkedIn groups with more quick, frequent, regular and lasting “stoking or the fire” to keep the learning narration going between participants.
What do you do?
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ps, Respectfully Yours
Walking back from the ASTD2012 ICE, the notion of respect remains on my mind. I wanted to share some ideas about differences I have seen and felt on an international and cultural level.
When I first arrived in Belgium I was loved by few, ignored by many and actively disrespected by some.
The last bunch of people (who shall remain nameless) most likely disrespected me out of suspicion and fear, as noted in the session with Paul Meshanko and Jim Knight today. They didn’t know who I was, what I wanted or what I stood for. They didn’t understand me, my preferences or my behaviour. I came from “nowhere” and couldn’t express myself in ways that related to their own experience. Even worse: I didn’t know anyone they knew…
Those who ignored me probably felt the same things, but were not hostile. Just aloof.
When I started as an independent trainer, I was interviewed by a training company who asked me: “Who have you worked for?” If I had been Belgian, I suspect the question may have been “What school did you go to?” Nothing I could answer would satisfy my interlocutor’s need for some kind of familiarity. I was alien.
When I wanted to say “Yes, but here’s what I can do” it didn’t mean anything.
This highlights my first point, which we can learn about in more detail from Trompenaars’ book “Riding the Waves of Culture”: For some cultures, respect is not about who you are and what you can do, but who you know and where you come from.
According to Trompenaars, in other cultures respect is associated with what you can do. These are the “achievement cultures” (as opposed to the “ascription cultures” referenced above).
What I find interesting today, here in the USA, is the level of respect I have been accorded by all the americans I have run into. I am called “Sir”. People turn to face me as soon as I arrive near them, smile and ask sincerely how I am doing or what they can do for me. This is much closer to the kind of respect Meshanko and Knight discussed today. Their respect for me is not based on who I am, where I come from or what I can do. They simply respect me for being another human being.
This is one of the values that Hard Rock Cafe lives by every day: “All is One”
Taking my reasoning one step further, I realise that the respect I have spoken of for the first 8 paragraphs of this post is not actually “respect”, but rather “esteem” or maybe simply “tolerance”. Real respect is an attitude that of hospitality and “going-toward”. That’s what I feel every day here in the USA.
Sarah Bloomfield on the (non)consulting mindset of L+D professionals
In a fantastic follow up to my blog this morning on how HR + Learning Professionals should become more commercial, Sarah Bloomfield (Senior L+D Specialist, Google) bangs the nail on the head for me. I’ll steal this idea and call it “borrowed authority”….
Need I say any more?
Enter L+D 2.0
True business-driven consultancy.
John Boudreau says HR has to change it’s approach
ASTD2012 session SU300 was delivered by Dr John Boudreau, Research Director of the University of SoCal’s Centre for Effective Organisations. He introduced the concept of Transformative HR and his research on its meaning and application.
In a session full of data (much of which I didn’t really understand) and some great examples, one core message stood out for me:
Here’s 2 simple ideas for HR professionals to consider in order to achieve this….
Stop delivering raw data that adds to the corporate information overload…
Deliver stories and examples that speak to them and their business issues
Instead of approaching recruitment in the classical way of desperately trying to deliver new hires immediately because the business says “I need him now” adding that “I can’t have too many people” with the additional demand of “Make sure I don’t end up with too few people”…
Get business leaders to think of human resources in the same way they might think of resources in a supply chain (“the right amount of people in stock for the market of today and emerging demands of tomorrow” and “the ability to move resources from one place to another”)
More good food-for-thought.
Awesome conference!
That’s all folks!
DAN
ASTD faces the content-crisis with community engagement
Following the ASTD Annual Report Meeting tonight at #ASTD2012, I see that the issues for ASTD are quite similar for two of the companies I have been hanging around with in Belgium recently:
- One of them is a leading provider of training (not Kluwer) focused on delivering expert content and who also prints books
- The other is a leading publisher
Now, its important to note that ASTD is in good shape financially: In 2012, with good membership and a mixed revenue-stream ASTD made 2.6 million in net profit.
Also nice to see is ASTDs vision/mission, which is in line with my own: “Make the world work better”
…and they have great values: Communication, Teamwork and People
Sounds great, no? So what’s the issue?
Simple: Bloody generation Y and Social Media ! (again)
ASTD (like both of the companies noted above) publishes books.
People don’t buy books like they used to.
ASTD (like both of the companies above) delivers content.
People can find their own content (easily).
On a strategic level, ASTDs answer is quite straight forward.
To face the competition from SoMe tools, ASTD must:
- Engage members more – go to them, get them involved, create partnerships and relationships based on dialogue
- Enrich content and offers to offer an added-value on what is freely available elsewhere
- Relevance, relevance, relevance – ASTD will filter, makes-sense-of and curate content to improve the link to members’ reality
- Offer endurable and scalable products and services
To make this work, ASTD will work around the idea of interest-based communities, led by community managers. Those managers do not necessarily need to be experts, but people who can create trustful dialogue with community members.
If you’re in the business of content, this is good food for thought!
Thanks for reading
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Visit www.infinitelearning.be
DAN
Learning Agility – the “X-Factor” of our future leaders
Challenges, speed and competition in the marketplace never cease to increase. With this ever-trend of more-and-more and harder-and-faster, future leaders will need more than ever to have Learning Agility. The subject of #ASTD2012 session #SU218 with Vicki Swisher of Korn/Ferry International…
Before we start, here is a screenshot from the awesome ASTD2012 iPad app where I followed Vicki’s presentation: Learning Agility is defined as…
It can be used to distinguish between high performers and high potentials – people who might be suitable for leadership roles in the future
What does Learning Agility look like?
One of the things that people with Learning Agility do is to question their mental models. They kill sacred cows. During the session, Vicki asked us to consider and draw a particular situation: “Two men are found dead in a cabin in the woods.”
Here’s what I drew:
Vicki then asked: “How did they die?” It turns out that they didn’t die from a gas-leak (as you might think from my drawing!) They died in a plane-crash!
If you (like I) immediately associated “cabin” with a wood cabin, then you probably failed to make the “fresh-connection” required to come to the answer. Making “fresh-connections” is a key part of Learning Agility.
In addition, people with Learning Agility:
- Are curious quick thinkers
- Work with good basic-principles (rather than pure analysis of “facts”) …a bit like the “Elementary Worldly Wisdom” Charlie Mungur is known for
- Seek diverse experiences to learn from, rather than sticking only to what they already know
2 reasons why Learning Agility so important (today)
- Jobs are getting bigger and the supply of talent is getting smaller
- People are getting to senior management functions much earlier than in the past. As a such, their experience is not so high. But they still need to be able to perform in senior roles.
Vicki Swisher also gave some ideas about how we can develop Learning Agility. Since its a behaviour, Learning Agility is something that can be observed AND developed. We need to develop people in 4 key areas:
- Mental agility – curiosity, the ability to think differently, to be creative
- People agility – the ability to seek out, connect to, learn from and work with other people; active empathy
- Change agility – not being afraid of red monkeys, open to change, asking open questions to look for new solutions, able to adapt
- Results agility – motivation for and skill for tough challenges, resourceful, willing to be pushed out of own comfort zone
..and we need to develop them differently: High-potential future-leaders need to be given a wide breadth (not depth) of learning opportunities and challenges. Let them lead diverse projects, build in job-rotation opportunities, assign them coaches from across the business….
As a side-comment, chatting with my Japanese neighbour Noriaki “Wassie” Washimi it occurred to us that HR and Learning people absolutely must have Learning Agility if they are to successfully work across a broad-spectrum of business areas and issues.
So: Go. Develop. Be agile.
Thanks for reading
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…or visit www.infinitelearning.be
DAN
