Selling ⁽¹⁷⁾

Business in an era when 1+1 = 2 (not 3)

Most articles that discuss a company's mission, vision, strategy, or even marketing often cite Nike and their tag line "just do it". It is also well known that during an earlier time Nike had a different internal slogan of a completely different sort:  "beat Adidas". About the same time Nike had their aggressive slogan, the company I worked for had a similarly aggressive internal slogan of "kill Weston-Loral" (our geographically closest direct competitor).

Why is it that these old style, aggressive slogans, that target a competitor are now so rare? Why are aspirational slogans like "just do it" all the rage? What can we learn about the effectiveness of these slogans in their time? My thesis is that such slogans were the products of their market environments and that much of the same market environment has returned leading to the conclusion that slogans and their consequential real action need to change back to the old again. Continue reading...

Almost every external facing business relationship requires activation in the form of a negotiation and a contract..  When I see good deals stall on small details it is usually because the discussions were initiated on a poor foundation.  Getting the 'big picture' correct before getting involved in the negotiation and contract details  is critical:  Is this a win-win for both sides?  How will healthy, normal communications take place during the execution period of the contract?  What will happen when dissatisfaction, mistrust, or irrationality steps into the relationship?

This last question is rarely considered at the 'design stage' but it should be.  Far too many contracts amplify the smallest conflicts by giving enforcement powers and ultimatums to one side or another.  Look at the default terms and conditions from a big company like BMW and imagine that one or both sides are dissatisfied.  The lawyers usually have ensured that there are lots of 'sharp sticks' and other weapons because they want to have a good foundation for a lawsuit.  Courtrooms are  "the nuclear option" where there are no winners or losers; there are only losers and bigger losers at the end of any court case.   For this reason it is important that business people include a soft conflict resolution processes that will reduce tensions and that all 'nuclear options' in the contract have safety devices lest they be used too quickly. Continue reading...

In several other blogs, I have talked about the ethics of needing to bring value to your customer and discussed various components of what this value might be.  I have also discussed negotiation theory where we try to find out what value is most valuable to the customer.

In today's financial crisis (Q1-2009), I can be reasonably certain that your customer values cash management.  You also are likely faced with the same financial reality and also value cash management; consequently, this is either a conflict/deal breaker or an opportunity to investigate how not all cash is equal.  If cash is not the same to everyone, then we have the perfect opportunity for great negotiations. Continue reading...

Cameras and Software Licenses after-sales

Yesterday, I was talking with a friend of mine who imports high-end Japanese consumer optical goods. He was telling me about how call volumes were increasing but sales were decreasing. Much of these calls were around service. I asked him if service was a big profit center for him. I was surprised to hear that it was not a profit center after 10+ years in the business. The following applies to someone reselling cameras as much as it applies to the creator of software licenses.

When product companies (factories, distributors, and retail) start, they often focus on initial product sales. As they mature (and their industry matures), the value of their customer base needs to be used and they focus more on services, support, accessories, etc. This is exactly the stage my friend is in-- much of his product line is sold at zero margin because of intense market pressure. Continue reading...

Patience is the key to favorable negotiations

In a business negotiation, the goal is not to defeat the other side.  Instead, we want to gain favorable conditions for ourselves and have the other side feel good about the final outcome.  If they feel that they in any way lost, then they will try to recover their dignity some time later by making you the loser.

The correct strategy is to ensure very good conditions for you, acceptable conditions for the other side, and then to give them a small gift at the end-- like a small chocolate at the end of a nice meal to ensure that the last memory was positive. The difficult part, of course, is to gain the great conditions for yourself with enough buffer so that you will be able to give the 'gift at the end'. The key is patience and understanding the clock. Continue reading...