Accelerated change redefines your market

Last month, Harvard Business Review’s Brad Power wrote a short piece about something software people have known for years, even if they ignore it: The rate of change is accelerating.

http://blogs.hbr.org/2014/06/how-the-software-industry-redefines-product-management/

An excerpt from Power’s piece:

I spoke with Andy Singleton, CEO of Assembla, a firm that helps software development teams build software faster. He told me the story of Staples vs. Amazon. As you might expect, Staples has a big web application for online ordering. Multi-function teams build software enhancements that are rolled up into “releases” which are deployed every six weeks. The developers then pass the releases to the operations group, where the software is tested for three weeks to make sure the complete system is stable, for a total cycle of nine weeks. This approach would be considered by most IT experts as “best practice.”

“Best practice”? Not really, but let’s continue:

But Amazon has a completely different architecture and management process, which Singleton calls a “matrix of services.” Amazon has divided their big online ordering application into thousands of smaller “services.” For example, one service might display a web page, or get information about a product. A service development team maintains a small number of services, and releases changes as they become ready. Amazon will release a change about once every 11 seconds, adding up to about 8,000 changes per day. In the time it takes Staples to make one new release, Amazon has made 300,000 changes.

While this situation is old news to software businesses and even to some non-software businesses that develop their own software, the thing you need to be aware of is that this accelerated rate of change and implementation stretches far beyond software.

You may have heard the phrase “software is eating the world“. In many cases, that’s about software disrupting and improving businesses and sometimes eliminating jobs. It’s also about technology and accelerated change in businesses that haven’t traditionally depended on technology.

This rate of change is reaching into many other niches – some faster than others. The question isn’t “Will it touch yours?”, instead the question is “When?”

Consider Amazon

You might be thinking that Amazon is a relatively new company so it was easy for them to start off producing systems as Power’s piece described. Trouble is, that isn’t the case at all.

While Amazon Web Services (aka AWS – the cloud services side of Amazon) has been around since 2006, Amazon has been around since the mid ’90s. They had to remake themselves to pull this off – but they chose to do so before someone else forced it on them.

Three dimensions

A few years ago, if you were in the engineering prototyping business, you might have a turnaround of a few weeks to a month, depending on the type of pieces you prototype.

Then one day, a 3D printer showed up on a local doorstep. Without a massive capital expense, delay and shop build out, a local engineer could now start turning out prototypes your clients could touch and feel in hours or for larger items, a day or two.

Perhaps you can work with that person to partner on projects and you both win. If you don’t, who will?

You can have a 3D printer on your doorstep tomorrow. What makes you different from the lady down the street who owns one?

The choice

Today, you probably have a choice in the matter.

You can either determine what needs a remake or restructure and make those changes (and experiments) on your terms, or you can wait and let someone else determine the time frame and terms for you. Most of us would prefer not to have someone else calling the shots.

I know, you’re busy. You’ve got this fire and that fire to put out. You’ve got soccer games to get to. I get it. I have those too and so do many other business owners.

It might be hard to justify any sort of disruption, even in thought, if your business is humming along on all cylinders right now.  That’s exactly what the disruptive businesses want. Keep doing what you’ve always done, because it’s still working.

Meanwhile, someone out there is fighting the same fires, perhaps as their business hums along, and all the while, they’re restructuring their business for this new reality.

What if they’re in your market? What if you did it first?

Doing ahead, not just thinking ahead

Quite often, I talk with business owners about thinking ahead.

Something that happened yesterday tells me that I need to change my terminology to “Doing ahead.”

Why the change?

Primarily, I’m concerned that small businesses are thinking ahead, but stopping there.

Thinking ahead discussions often include strategic thoughts of putting yourself out of business by inventing new products and services for your customers that replace your current top seller.

So let’s talk retail for a moment, since they’re an easy example.

Every time you enter a WalMart store (something I try to avoid – I’m just not into the crowds), you’re likely to see something different. Just a little thing here or there that’s different. Sometimes it’s a test to see how something works, other times it’s the result of such tests.

What you never see is exactly the same store, time after time, town after town. Sure, the overall store is quite similar overall but there’s almost always something different. Something being tested. Something being implemented.

This effort isn’t limited to their brick and mortar stores. WalMart and the rest of big retail spend a lot of time looking at how they can improve the performance of their online retail properties. They have lots on their todo list simply by comparing themselves to Amazon.com – which blows away most (if not all) online retailers in end to end performance and customer engagement.

This is the price they pay for ignoring Amazon during their climb to cruising altitude.

What we don’t see is massive shifts designed to make the store or parts of the store irrelevant. It doesn’t mean they aren’t there, but they’re much harder to see in a brick and mortar store. Honestly, I can’t think of the last time I saw a brick and mortar store do something like this but I suspect I just don’t recall it.

Amazon tweaks too

Naturally, Amazon.com is working hard to improve what they already do – testing and tweaking their retail site and their back end (such as the systems that email you about things you might be interested in). You can see evidence of this on a regular basis.

Meanwhile – they’re doing things like what you see in the video above (More video here from 60 Minutes).

This isn’t just about speed, though that is certainly part of it. Keep in mind that this also means that Amazon can deliver without using any of the established shipping systems – all of which have legislative limitations as complex as those currently preventing the use of shipping drones. The only difference is that no one wrote a pile of legislation in the 1920’s to protect the USPS, Fedex or UPS – all of whom are just as likely to have drones in their future.

Parts of this are not just changing the rules but eliminating them wholesale. I would expect this to be implemented in other countries long before it happens in the U.S., due to the legislative challenges here. We’re already well on the way to delivering relief supplies via drone. Why not retail?

Learning while looking ahead

Learn from seeing Amazon look years ahead without a guaranteed payoff, hitting on pain points, looking to shorten the sales cycle (money loves speed), looking to eliminate competitive disadvantages with WMT, looking to improve/control shipping, etc – while ignoring the fact that they can’t put the drones into service and prepare for the day when they can.

They’ll be learning new things about their business and their customers as well.

The challenge for you and for businesses all over the world is not to see another way that Amazon will eat your lunch, or to think you’re safe because you aren’t in retail, aren’t near an Amazon fulfillment center or are in a rural location unlikely to be served by drones.

Your challenge is to think beyond the advances you’ve been working on or considering. Those advances are important, but you also need to be figuring out things that are years off, all while considering what will replace them.

The dangerous thought is to ignore these things because they don’t threaten you now and wont for years.

Why is that so dangerous? Because that’s exactly what many in Amazon’s market did a decade or so ago – and they still haven’t caught up from making that mistake.

Are you being showroomed?

Multi-Touch
Creative Commons License photo credit: DaveLawler

If you have a retail store, you’ve almost certainly had people showrooming in your store.

If you haven’t heard the term,”showrooming” can be summarized as “shopping at local stores to check out an item before buying online.”

Showrooming takes different forms and includes:

  • Price checking items on the internet while walking through a store. That bottle of foo-foo shampoo is $28.99 at the local grocery. Maybe it’s cheaper online, so people use the barcode to find a price at Amazon. A showroomer might even order right there in aisle five before they forget.
  • Going to a local store to check out a product you plan to buy online.

Electronics stores and retailers who sell complex, expensive items like cameras are most often showroomed.  Seems harmless until you consider that the local retailer is paying rent, salaries and other expenses to provide you with a free way to make sure that thing you want is really what you want – so you can leave their store and buy it at Amazon or B&H.

Internet-ready smartphones didn’t create showrooming. It’s just easier now. The same thing happened to retailers during the catalog mail order era.

Rather than complaining about it, let’s take a different tack.

One antidote to showrooming: A decent website

Showrooming isn’t just about checking out products and then going home to order them. The good kind happens too – meaning your website shows what you have in stock that’s ready to pick up today or when you can deliver it.

I’m in the process of moving to a new place. One of the unbridled joys of moving is packing your stuff. With the long weekend in front of me, I figured I’d knock out a bunch of packing. Silly me – even though I started the day with 40 boxes, I ran out Saturday evening.

Thus began the battle. U-Haul places are closed because of the long weekend. Most home stores and some box stores carry moving boxes, but it was after six, so that meant I was out of luck locally and would have to drive to town. I don’t “drive to town” for giggles, so I started surfing in hopes that someone had them in stock. If not, then my weekend plans will change (yes, a little of me was hoping I’d come up empty.)

Call it reverse showrooming, but I want to find what I need before I go chasing all over the valley for no reason.

The first box store site shows that their stock is online-order only unless I want to wait a few hours to find out what they *do* have – and then only after placing a “pick up and wait for a call/email/text” order – which felt more like betting on horses.

Some sites make searches like this easy.

For example, Home Depot has a filter on their website that eliminates anything that isn’t in stock at my “home store” (the store that I’ve told the site is closest to me). That works well, since I want immediate gratification – if you can call a shopping trip for boxes “gratification” (doubtful). Anyhow, if I can see what’s in stock, then I don’t have to take a chance at a 36 mile round trip for no reason. Finding up to date store inventory info on their site means they help me avoid wasting time and money – even at full price.

In Home Depot’s case, they also have tabs showing “All products”, “In-Store”, or “Online” – plus the filter I mentioned above.

I drove the 40 minutes and spent the 40 bucks because my local retailer was closed (which is OK) and because Home Depot’s site had enough information to allow me to make a solid decision.

Why do people showroom?

One reason is price, but for many products, the online merchant has done a poor job of selling the item. As a result, the prospect has to invest additional time to find the product and make sure it’s really what they want/need.

Why can’t your store site do that?

TIP: Big corporate stores often use automatically collected product data pulled from manufacturer data feeds (I’ve worked on these systems). Want some evidence? Look at a nationally-sold item at several large retail websites. Is the description identical? Is the picture?

You can do better. Next time, we’ll dig deeper on the causes of showrooming and discuss some solutions.

The Amazon Prime Directive

Moving away from the light....and into the darkness of night
Creative Commons License photo credit: mendhak

What did you learn from – and change in your business – after Amazon launched Amazon Prime?

If you aren’t aware, Amazon Prime is a membership-based service that provides access to Amazon video-on-demand and free Kindle books from the Kindle lending library – but more importantly, it upgrades all purchases to from regular ground shipping to free two-day shipping.

The question remains – what did you take away for your business from the launch and subsequent success of Prime? Did it provoke you to change anything about your business and how you work with customers?

Even if you don’t do retail, there are lessons to be learned from what Amazon is doing.

The Fresh Prime of Bel-Air

Plenty has been written about the success of Prime and what it’s done for customer loyalty.

One quote from the Small Business Trends piece (linked above) that might get your attention – a comment from a Morningstar analyst who researched Prime:

What we found is that, generally speaking, last year Prime members spent about twice as much as non Prime members. (emphasis mine) They spent about $1,200 dollars compared to $600 for non Prime members. What’s also interesting is that the average person shopping online last year spent approximately $1,000. What that says to us it that Prime members generate more incremental revenue per than non Prime shoppers. They are doing most of their online shopping on Amazon as opposed to going to other sites. Prime members generate more income.

Recently, Amazon took the service a step further with the introduction in Los Angeles of Amazon PrimeFresh, which expands upon their Seattle-based test program.

What can you take away from this and implement at your business? Do it for them. Deliver it for them. Automate it for them, as appropriate. All with more personal touch than Amazon can afford to do *in your community* and *in your market* with *your customers*. Yes, automation *can* result in more personal touch.

The key is the emphasis on your community, your market, your customers. I’m not suggesting that you try to clone Amazon.

Behavioral shifts

There’s much more to this than automation allowing you to buy produce via your web browser. Customer behavior is central to what Amazon does.

When Amazon saw that Prime members behaved differently, then they could work differently with them. Simply by buying a membership in Prime, a buyer is telling Amazon “I am going to buy more, more often.”

If your customers could send you a signal in advance like that, how would you use it to improve what you do for them? How do you care for your best customers? How do you encourage new customers to take advantage of what you offer like your best customers do? How do you make buying friction-free and easy?

Now reverse that. If you look at customers who buy more and more often from your business, what are you doing to take care of them? What if you did those things for more of your customers – would it turn some of them into Prime-like customers?

Amazon, WalMart, You

We’ve talked repeatedly about “When Wal-Mart comes to town“. Amazon’s taken WalMart’s game and made it more convenient and logistically efficient.

Take from them what makes sense for your business and implement it a step at a time, even if your implementation looks completely different. The lesson is doing what matters for your customers, rather than blindly cloning what Amazon or WalMart do.

For example, let’s say you sell high quality, organic meats that your area’s chain grocer doesn’t carry.

Do your customers forget to stop by your place? When they’re at the grocery, do they grab something there because it’s in front of them? That convenience can cost you a $25 sale. How many can you afford to lose each week?

While you probably can’t afford to provide same-day delivery like Amazon does in Los Angeles, you can serve your neighborhood or small town in a similarly convenient way. Maybe you deliver on Thursday evenings so people have their weekend meat supply for campouts and family gatherings in advance of their weekend grocery shopping. A part-time employee could deliver their pre-paid orders.

You don’t have to cover the whole state 24 hours a day, just your market area (or part of it) as convenient.

Make quality, local buying easy. That’s the local Prime Directive.

What isn’t Amazon going to change?

During Amazon Web Services’ (AWS) November re:Invent conference, there were a number of interesting talks.

Psst…Don’t run away, not-interested-in-technology folks, this is barely about tech if you look closely.

I got the most out of the sessions centered around the strategic design decisions that Amazon.com (an AWS customer) and other AWS customers were making.

These discussions were all about making a system resilient, scalable and capable of reacting quickly and transparently to changes in the business – while keeping costs as low as possible and tied directly to the business’ actual resource usage.

Naturally, their point was that AWS helps provide this ability to people who build systems.

AWS streamlines server infrastructure the same way LTL trucking streamlines freight shipping.

LTL clients get to use a high quality transportation system without investing a fleet of trucks, warehouses, dispatchers, mechanics and drivers that they may not need two weeks from now. Yet all of those resources and jobs are necessary to get freight from point a to point b. Shippers pay for what they use, meaning less waste, more efficiency, better job security and better asset use.

As I said, this isn’t about tech.

No one ever says

During a discussion on why AWS is always changing, Bezos summed it up simply: “No one ever says ‘Jeff, I love AWS but I wish it was more expensive.’ or ‘Jeff, I love AWS but I wish it was a little less reliable.’ or ‘Jeff, I love AWS but I wish you would improve it at a slower rate.’ ”

Is it any different for you? For the LTL trucking firm?

In a business where inexpensive, high quality delivery whose cost tied to usage is the focus, these changes simply don’t happen without high quality systems managing things.

Systems reduce inertia, eliminate obstacles and streamline processes so people can get the right work done faster at the same (or better) level of quality.

They aren’t about tech.

What’s the next hot thing?

When Bezos was asked about the difference between being an entrepreneur when he started Amazon (1995) and now, he said “the rate of change has increased substantially”.

He noted that people always ask him what the “next big thing” is and lamented “I almost never get asked ‘What’s not going to change in the next 10 years?’ “.

He likened businesses that address those long-standing needs to flywheels. They take time to spin up, but run smoothly and efficiently once at operating speed.

These days, solutions to these needs can be built anywhere. In a rural Montana community of 4000 people, Zinc Air has developed energy storage technology that makes dependable, scalable, portable power storage a reality.

Power availability in the developing world is a need of substantial scope as it is in places that would otherwise require months or years of infrastructure construction. It’s one more example of a need that isn’t changing anytime soon.

Is there a business there?

Not all that long ago, a substantial reason for chasing venture capital was the cost of server infrastructure. Using cloud computing like AWS, you pay for what you use as your business grows, rather than for massive infrastructure you may never use. A long-standing obstacle that impacted business development has been addressed.

Obstacles like those that LTL trucking, AWS and Zinc Air eliminate are the kind of change that Bezos was talking about when he spoke of businesses addressing long-standing inefficiencies, problems and barriers in things that won’t change over the next 10 years, rather than trying to figure out what the next big thing is.

Consider hunger. The short term solution is usually feeding people who can’t feed themselves. The long term solution is somehow enabling them to alter their economic situation so they no longer need help feeding themselves. Solving it might include some combination of jobs, medical care, child care, irrigation, clean well water, transportation, seed stock and better farming methods.

“The next big thing” might be your streamlined solution to just one small inefficiency in one area that makes hunger so difficult to extinguish. And it might be bigger than Amazon.

If you’re willing to be misunderstood for a long period of time, then you’re ready to start something new.” – Jeff Bezos, commenting on starting Amazon.

Rather than sweep, eliminate the source of dirt

During the Amazon Web Services (AWS) Re:Invent conference‘s “fireside chat” with Jeff Bezos, he told a story about during a professional development session where he (like all senior Amazon management) spent two days on the Amazon customer service call center staff.

Stop for just a minute.

If your business is small – you likely spend time on customer service, even if not by choice.

Depending on the size of your business, you’re might be insulated from your customer service people and likely from your customers. While it isn’t something you want to do every day, I assure you the value of doing what Amazon senior management does here is sizable.

Listen to the quality

I’ve sat within earshot of my customer service staff. You learn a lot about your quality. Sometimes you learn things about your quality that runs a chill up your spine – but that’s better than not knowing.

That’s what Bezos learned.

During the session, he handled calls and operated the customer support system while being coached through the process by an experienced Amazon customer service person as each customer called in.

While this had to be hugely educational for him about unmet needs and/or streamlining processes for his customer service team, he learned a unexpected lesson – how things really work when it comes to product quality at Amazon, which gave him an idea to improve quality and do so before the cost of low quality grew.

Listen to Bezos describe the result – how Amazon now handles poor products, poor packaging and enables their staff to communicate quality information (and make decisions) about them – much like Toyota’s assembly line allows anyone to “pull the cord” to stop the line to deal with a defect (2 minutes, 47 seconds from 18:01 to 20:48):

 

Can your sales/service people pull a poorly-made or poorly-packaged product off the sales floor? How long will you sell a lame product or perhaps worse – a good product delivered poorly – to your “valued customers”?

How would this impact your buying process and related contracts? How would this impact your product quality and delivery feedback processes? Note Bezos’ use of the un-word “systematize” – not just making more work, but making a new system to make the work and customer experience better.

If you don’t do these things (in your own way, of course), are you willing to deal with the disadvantage this creates between your business and businesses that handle this as Amazon does? What else could you do rather than this to assure the same level of highly-consistent quality of products and packaging?

Remember, this isn’t about replicating what Amazon does. The important thing is to replicate or improve upon the results.

Doing the right work

While discussing a week-long Kaizen (quality) professional development training session, Bezos talks about a Japanese consultant who chastised him for sweeping up some dust on the warehouse floor (1 minute, 54 seconds from 20:49 to 22:43):

 

Eliminating the source of dirt is more important than finding a better janitor or a better broom. Obvious, once you think about it.

Smart businesses regularly do something new and different in their market, producing really good results.

I don’t mean not-so-thoughtful act of cloning a service or a product. I’m talking about the processes and systems that a strong business depends on and eventually turns to as a strategic advantage. Might be a sales or marketing process, might be front or back office.

Once the value is shown, even of a non-obvious system/process, why wouldn’t these things be duplicated by business B when they see business A gaining value from them?

  • Sometimes the new system/process was intentionally designed to be complex so that it would be hard for competitors to duplicate.
  • Sometimes those complexities don’t impact a small local business but a parallel business need for a similar system still exists in that business that should be considered.
  • Sometimes we have this odd tendency to watch someone do something great and stop right there because it’s so easy to assume that we can’t do what others have done.
  • Sometimes the lead isn’t followed because of ingrained beliefs like “Yes, but that’ll never work here.”

What’s your reason? What system would transform your business front office? What would transform the back office? These things don’t have to be massive or expensive. As one of my mentors says, “Little hinges swing big doors.”

How to keep cloud service failures from affecting your business

You look at those prices for Amazon cloud services and think you’re getting a deal.

Fact is, you are. You’re hiring a professional staff to run your systems in a very-high-quality environment and paying little for it.

But are you using these cloud services in a way that protects your business?

Forbes analysis of the Northern Virginia Amazon cloud outage from Friday’s storm doesn’t clarify who does / doesn’t use the NoVa cloud site vs. who had a better redundancy setup.

Netflix and Instagram are likely re-examining their use of cloud services. I doubt they’ll eliminate Amazon as what happened in Northern Virginia can happen anywhere. They’ll likely discuss cost-effective means of increasing redundancy that leave them less sensitive to single location failures.

Questions to consider

Redundancy with transparent switchover to backup systems with no data loss is ideal. Do you need that? Can you afford it?

Ask the right questions when designing your use of cloud services:

  • How much downtime are your customers (internal or external) willing to tolerate?
  • Do you know what an hour of downtime costs internally (lost productivity, inability to serve customers) and externally (refunds, lost customers).
  • Given those costs, how much downtime can we afford?
  • What notification mechanisms do you need to have in place to switch? (or is the switch automatic?)
  • What do I want to happen when a failure occurs?
  • What am I willing to pay for my desired level of redundancy?
  • What will a failure that doesn’t use this level of redundancy cost my business?
  • How do you switch to the redundant system? Is it manual? Transparent?
  • Does your vendor offer redundancy? How does it work?
  • Are your vendor’s redundancy sites geographically dispersed?
  • How does my data get replicated?

This really isn’t about Amazon. It’s necessary to protect your business whether you use Rackspace, Amazon, Microsoft Azure or other cloud services. The key is knowing what you want to happen when a failure occurs and designing it into your processes.

Why not keep it all in-house?

It’s tempting to keep your data in-house. It somehow seems cheaper and there’s the impression that it’s more secure. Evidence indicates locally-hosted data has its own risks.

Locally-hosted systems have a single point of failure. I’ve had clients whose businesses have burned or flooded and others whose servers were stolen. Without a remote location to transition to, you’re down. Can your business handle that? If so, for how long?

Security

Security of internal business data is a concern with cloud vendors. High-quality cloud vendors obtain security certifications like SAS70 (financial industry), HIPAA (health care) and PA-DSS (credit cards), which require regular audits to ensure continued compliance. Companies who keep their data internal are subject to them as well – yet they still suffer data loss.

Local data storage doesn’t allow you to escape expensive HIPAA or PA-DSS compliance if those requirements apply to you. In the financial industry, systems are sometimes subject to examination by the OCC (Office of the Comptroller of the Currency) and/or other agencies. But that doesn’t prevent data loss.

Regardless of system/data location, security should be designed into business processes rather than added as an afterthought.

Electrical power and internet

Cloud vendors use industrial-class electricity supplies with diesel backup generators. Their investment in these backup systems vary both in capacity and available time-on-generator, so ask for details. A site’s ability to run on diesel for two weeks isn’t nearly as important as your ability to switch to another facility in two hours…unless they don’t have two hours of generator time.

You can (and should) use an uninterruptible power source (UPS, aka battery backup) with automatic voltage regulation (AVR) to protect your local systems, but you’re still face internet-related downtime if remote staff/clients need to access locally-stored data.

Cloud vendors have multiple very-high-speed internet providers so that they are not subject to pressure from any single vendor and so that a single vendor’s downtime doesn’t bring the entire location down. You can do the same, but most small businesses don’t. If remote connectivity is critical to your business, it’s a smart strategy.

Whether your systems are local, cloud-based or both – plan for what happens when the lights go out. It just might save your business.

 

 

Out of Stock

Quais de Seine, Paris
Creative Commons License photo credit: Zigar

When your store is out of stock on an item…what does your staff do and say?

When I was out of state not long ago, I looked around for a pair of light hikers for everyday wear. I knew exactly what I wanted right down to the model name.

I visited a locally owned store, but they didn’t have my size in stock. A few days later, I visited a box store. They had the shoe on the wall (which is never my size), but they didn’t have any others. They didn’t even have the match to the one on the wall.

As I got into the car in the box store parking lot, I called the locally owned store again just in case they had some new arrivals. Nope.

They offered to order a pair for me, but I told them I was visiting from elsewhere and wouldn’t be around when they arrived.

At this point, they had choices:  Focus on the sale, focus on the customer or try harder.

What’s your focus?

If your sales people are trained to focus on the sale, they might say “Nope, we don’t have any” and be disappointed that they didn’t get a sale. If that’s the end of the conversation, your customer might go elsewhere – losing the sale and the customer.

If your sales people are trained to focus on the customer, they might say “Nope, we don’t have any. Have you looked at (competitor number one) or (competitor number two)? They both carry that brand.

If your sales people are trained to focus on keeping your customers happy, they might say “Nope, we don’t have any. If you come by and let us fit you in a similar shoe in that brand, I can order that model in your size and have it shipped to you. If it doesn’t fit like you want, we’ll take care of you until you’re happy or we’ll give your money back.

What they did was refer me to two of their competitors (one was the store whose parking lot I was in). The second one had my size in stock, so 20 minutes later, I had my shoes and was heading for the in-laws place.

The “try harder” choice might not have been what I wanted, but I wasn’t given a choice. Keep in mind that you can always fall back from the “try harder” position if the customer isn’t interested in or cannot use that kind of help.

The important thing

You might think that the locally owned retailer lost a sale, but that isn’t as important as keeping the customer over the long term.

While I wasn’t able to buy the shoes from the place I wanted, they were able to help me find them.

They could’ve run me off quickly by saying “We don’t have that size.”

They didn’t do that. I suspect their handling of the call was the result of training driven by a management decision.

I wasn’t a familiar voice calling them on the phone. While I’ve bought from their store on and off for 20 years, they don’t know that because they keep paper sales tickets. I’m not there often enough to be a familiar face / voice and had not been in their town for two years.

Yet they treated me like someone they want to come back.

Do you treat your customers that way? Do your online competitors?

Competition from tomorrow?

Sometimes business owners complain about online competition.

Yet online stores can rarely provide instant gratification. It’s difficult for them to help you buy something you need today for a meal, event, dinner, date, meeting or presentation happening later today.

They can rarely deliver the kind of service a local, customer-focused business can offer.

Online often gets a foothold when local service and/or selection are poor and focused on the wrong thing. Even with online pricing, a product isn’t delivered until tomorrow.

When you aren’t competing strongly against tomorrow, you really aren’t even competing against today.

Focus on helping them get what they want and need. Whether they are local or remote, customers just want to be well taken care of and get what they came for.

Your customers are already trained to share. Help them.

Have you noticed what happens when you add an item to your Amazon wish list?

Three tabs appear on the right side of the “We just added this to your wish list page”.

This tab is ready-made for a Facebook post with just one click. There’s a link to the book, a brief summary of the book and a 1 click button to share your wish.

This tab is ready-made for a tweet with one click.

It even makes note that a link to your wish list item will be part of the tweet and because 140 characters is always on the mind of Twitter users, it notes that the link’s characters are part of the characters-remaining count shown at the right side of the tweet box.

This tab makes it as easy as possible to share about your wish list item via email.

Forget Amazon…what about you?

Your customers are already trained to share both the good and the bad.

Facebook, Twitter, Amazon and many others have made it fashionable, normal, if not part of our culture. Even if you don’t participate in the sharing, your customers do.

How are you giving your customer easy ways to share what they want, what they love, what they dislike, what they’d do different – with you and with those important to them?

 

Borders and homemade apple pie

Recently, Borders book stores reported that they were closing their remaining 399 stores, including our local store here in Kalispell, Montana.

The store has about three months, enough time to liquidate their existing stock.

Survival of the fittest demands that some prosper, some get by and some die. Borders was not one of the fittest booksellers around, and few businesses have a chance of getting up after taking a one-two punch from Amazon and Apple.

Still, there are takeaways for the rest of us.

Homemade Apple Pie?

When you go to an online store, you KNOW when they’ve just tossed up a store so they can say they have one, kind of like how your mom knows when a local restaurant makes their own apple pie or serves a food service vendor pie.

In one case, it’s a labor of love. In the other, it seems like it’s just there because it has to be.

It’s not unlike Borders’ technology, eCommerce and eBook efforts. Once they got around to it, they served food service pie.

Who to blame?

They can’t blame Napster and peer-to-peer sharing. The music business can try, but you don’t see music acts starving. The same can’t be said for their the stuck-in-the-50-60-70s music management houses. Ask a Canadian or European about online music listening from US-based services. You won’t hear many kind words. Inertia and lack of vision killed many of them and took the local music store down with them. Napster was simply the messenger and peer-to-peer the medium. There’s no equivalent in the book business.

They can’t blame their store staff. In the Borders stores I’ve visited, the staff is well-trained and eager to help. Maybe reading fans self-select as Borders job applicants. Regardless of how their stores found their front-line employees, I can’t think of one who wasn’t helpful, knowledgeable etc. I can’t ever remember being tempted to write about them due to bizarre or off-kilter treatment there.

They can’t blame Amazon or Apple. Sure, they can point to the Kindle, the iPad, the Amazon and iBook store (and these two behemoth companies) as what killed them, but blame? Nope. Amazon and Apple offered a great example, partnering opportunities and millions of potential buyers.

Meanwhile, how many of your friends have a Kobo reader? Did you know Borders has an iPhone reader for their Kobo ebooks? Both are food service apple pie. When you’re competing with the likes of Kindle and iPad, you have to be easier, better or cheaper.

They CAN blame C-level management. Certainly Amazon and Apple were a major challenge, but without strategic vision and execution speed, the results were obvious and inevitable. As the Inc. article notes, they had a weak online retail presence and addressed technology change as if it was a chore, not a differentiator.

Management and strategic direction just happens to be your job. How are you addressing those two things?

Serve homemade pie

You may not have to worry about Amazon or Apple, but that doesn’t mean you have nothing to worry about.

Many independent bookstores have failed in the shadow of Barnes and Noble, Borders (and later, Amazon and Apple). But NOT all of them. What makes those stores different? Why are they “immune”? The reality is, they weren’t and still aren’t immune.

The survivors didn’t stare at the door, wondering why more people aren’t randomly deciding to enter their store. They did something about it. They transformed their businesses into one that Amazon or the Apple iBook store will never be: A specialty store delivering amazing personalized service while delivering a product few others will “trouble themselves” with, within the bounds of a business plan that is designed to survive an Amazon/Apple book selling world.

Each one of them uses their online presence as a strategic advantage.

Even if you sell tractors, chainsaws and weed whackers, people are going to search online for info about you and your products. If your online presence offers them the equivalent of the food service apple pie, their next purchase might be at Chainsaws.Amazon.com.

Does your business leverage technology, or use it only when forced to?

Serve homemade apple pie.