Playing Netflix Chess

I read publications, punditry and blogs focused on a number of different industries.

I hope you do as well. Reading only the trade publications from your industry is dangerous, dangerous, dangerous.

For example, there’s an awesome blog post by Ken Doctor based on comments made by Netflix founder Reed Hastings“. Go read it (< 1000 words) and slide back here. The link will open in a new window.

I don’t have a digital business

Some of these things might be perceived as applicable only to a “digital business”. As you read “Savor the economics of digital distribution” or “presentation revolution is still to come”, you might wonder how these could impact your blacksmithing business.

I think if you look hard enough – every business probably has a digital (ie: tech-related or internet-enabled) component.  If yours doesn’t, maybe it should…

I see you out there bouncing up and down in your chair. You disagree.

If you’re a guy whose office is a F-250 full of tools, think a little about estimates, appointment scheduling, material ordering / delivery, drawings, invoices, training and safety.

Enough of that…Let’s discuss Reed’s lessons.

Spend your time on tomorrow, not today

This is all about being strategic. Delegate today, as much as possible. If you get bogged down in the “crisis of the urgent”, you’ll have a very difficult time focusing on the long-term strategic needs. You can’t (shouldn’t, at least) manage your business “paycheck to paycheck”, even if your cash flow currently feels that way.

Savor the economics of digital distribution

In All the President’s Men, it was “follow the money“. In your business, it’s “follow the paper”. As you read about the $600 million Netflix currently spends on postage and the labor involved in DVD quality control, consider the costs and labor you incur by shoveling paper around.

Even if you are legally obligated to keep that paper, you can make changes that allow you to handle it ONCE and thereafter refer to digital copies until the paper copies are (possibly) needed. Leroy Schulz suggested I get a ScanSnap several years ago. I finally did. UNREAL. If you deal with a lot of paper, just get one. That’s just one example of a small, but substantial change you can make to unchain yourself from the paper.

Don’t sweat the timeline

The time to be visionary about what your clients need is NOW. It is NOT when they (finally?) realize they need that great idea you had years ago.

That said, you should expect to have to educate your customers and your industry about why that visionary thing is so important. It will take time. Take advantage of the visionary advance while you can and sell it as soon as you can show value for it.

No one asked for an iPhone, yet Apple has sold millions, transforming their financials and leveraging what they’ve learned throughout their product line. Visionary. Again.

Everyone reading this is capable of being that visionary in some aspect of your industry. You just gotta put yourself in the customer’s place.

Play chess, not monopoly

Strategy, strategy, strategy. Sure, you can fill a lobbyist’s wallet and invent a monopoly, but eventually that advantage will somehow end. It’s tough (though not impossible) to legislate innovation out of business. I’m pretty confident that entrepreneurial innovation is smarter than the collective intelligence of Helena or DC. It’s certainly easy to move faster than any legislature.

If you put the customer and their wants/needs at the center of your strategic thought, you *will* succeed. Good chess players think 2-3-4 moves ahead. Great chess players are thinking a dozen or more ahead. Think about your business that way.

The best way to create what appears to be a monopoly (in the eyes of inferior competitors) is to deliver amazing every single day and improve with every interaction, every hour, every shipment, etc. Chess is no different. The best can play and innovate in their head, during the game.

The presentation revolution is still to come

For many of you, this is about mobile, mobile, mobile. Yes, kinda like “Location, location, location.”  But it isn’t just about that, so don’t think solely in that way.

How many ways can what you do be delivered? If your business seems immune, think about the overhead of doing business with you. Are you causing more of it? Do you invoice on paper or PDF? Do you mail a check (requiring a trip to the bank) or do you pay some other way? Do you invoice (or pay) manually every month when it could be automated? (ditto for payment) What about ordering? Stock inquiries? Appointment scheduling?

Do easier, faster, smarter. Without cutting quality.

Culture counts

Working in a place with people you want to work with and people who value excellence. It’s easy to slough off as “touchy-feely”, but if you’ve worked in an environment that values quality and improvement, you’ll never again feel comfortable in anything else (well, unless you’re a slacker).

And finally, Walmart.

Ken’s comment about Hastings’ response to why Walmart didn’t kill Netflix – and why it shouldn’t kill your business – speaks volumes: “Itâ??s not the stuff, itâ??s what you do with the stuff to please customers. Netflix isnâ??t about simply getting you a movie. Itâ??s the recommendation engine and lists, the customer-pleasing, no-late-fees (remember when this was a huge issue?), its easy-to-use interface and its social/sharing emphasis, among other features that let it distinguish itself in consumersâ?? minds.

If that quote doesn’t spawn thought processes to revolutionize your industry, then you just aren’t thinking hard enough.

President proof your business #2: Drizzle on the absolute best

Even though President-Elect Obama’s staff has started to take shape (and the hand-wringing has begun), you shouldn’t think of “President-Proofing” your business as something specific to him.

Sure, some things will be different in an Obama administration than in a McCain one, but the things you have the ability to exert control over are largely insensitive to the personality sitting behind the Resolute desk.

One way of President proofing your business is to simply do more business. Obviously, we talk about a number of additional ways to attract (as opposed to chase) new clients, but one we haven’t ever discussed is that of the ripest fruit.

The ripest fruit might not be the best term for it, but bear with me. I’m talking about the clients you would simply LOVE to have. Surely there’s a list in your head of 1, 2, half a dozen or 100 of them.

You might not have 100 on the tip of your tongue, so let’s talk about the process.

If you were asked to choose the absolute best group of people (if you run a consumer-oriented business) or absolute best businesses (if you run a business that serves other businesses) that you don’t currently have as a client, but would be thrilled to have as new clients, who would be on your list?

Yes, I’m suggesting you make a list and that you expand your thinking a bit. There are all kinds of ways to qualify for this list.

Will they be a high-profit or long-term repeat client?

Will they be a client who will result in other people flocking to your business, simply because you can say they are your client?

Will they push your business into a new market for the products and services you already sell?

If you own a retail store, maybe you do some wholesale or online selling as well, so don’t forget those. If you own a service business that primarily serves consumers, don’t forget that some businesses might need your help – sort of like an quick lube oil change shop might do all the vehicles for a city, a county, or a business with a fleet of cars and trucks.

This technique works better as a way to attract businesses than it does to attract a consumer type of client, but it will work for both if you put some thought into the next piece of the process.

Putting the list to use

Once you have this list, make it a part of your daily schedule to learn as much as you can about the businesses / people (be polite, please) on your list. Maybe you or your assistant spend 15 minutes a day researching the people on this list, but do it. Schedule it.

Even if we’re talking about attracting a business – there’s still a person you must attract. Businesses don’t buy stuff. People do.

Begin contacting them regularly – but not with a pile of sales stuff, no matter how good it is.

Create a system for researching, contacting and continuing to casually drizzle pertinent, helpful information on your prospect list.

Your system might include some of these steps – and might include ones I haven’t listed here:

  • Add them to your print newsletter mailing list. DO NOT start emailing them a bunch of stuff, even your email newsletter. Your print newsletter should refer to it so they can sign up if that is one of the ways they prefer to get info.
  • Every week or two, send them a hand-written note or card – NOT a sales pitch - that includes something important or meaningful to them. This might include an article in the paper or on the net about one of their staff, themselves, their business, one of their customers or a family member. It could be something as simple as a snipping of something out of a paper from across the state that talks about a cousin. It might be as simple as a web page about one of their customers, or about their industry, accompanied by a short note that says you thought they might be interested.
  • Maybe you don’t know their cousin, but you see a similar name from the same hometown as theirs in their hometown paper. Cut it out, send it to them with a note saying you were guessing they might be related and if so, hope they enjoy the snip from that local paper.

Expand on this as it makes sense for the type of person or business you are courting. DO NOT chase them. Simply “be present” with information helpful, interesting or pertinent to them.

You want to be seen as a valuable resource to them, not a pest – this is particularly true for consumers. If your marketing to this group of people was a rainstorm, it wouldn’t be a driving, windblown drencher, it’d be a fine drizzle.  

Add this as just one of the ways you attract new clients to your business. Why not go for the clients you’d really like to have? Someone has to serve them. Why not you?

Once they respond, then they should become a part of the funnel or process that your marketing system takes them through to guide them to being a client.

There’s no need to wait for the inauguration. You can start working on this today.