I’m talking to entrepreneurs about how they navigated the transition to corporate life after selling their companies.  What happened.  What worked well or poorly.  What turned out to be most important for success, however they defined it.  What they wish they had known going in.  And most importantly, what advice they’d give fellow entrepreneurs in similar situations.

My plan is to publish the findings in a series of blogs, and eventually package them to share with entrepreneur communities.  Early results have been fascinating, and there is high interest in the subject.

I’m looking to expand the number of interviews to get a broader representation of entrepreneurs.  If you are a CEO or founder who sold your business and joined the acquiring company I’d love to hear your story.

I’d also love to hear from others who might have visibility into this subject.  You might be an investor, advisor, or part of the acquiring company assigned to integrating new businesses.

Know anyone?  If you’re interested in participating please contact me directly!

Reading Progress is an app in Microsoft Teams that enables students to independently read aloud, record themselves, and grow their reading skills while allowing educators to better support students’ progression. Students share the audio or video recordings of themselves with their teachers who can then track progress, provide feedback, and discover trends and opportunities for student growth.  As of March 2022 Reading Progress is available in over 90 languages.

Both students and educators benefit:

“In front of the camera, I don’t feel that stressed out.  I feel like I’m less distracted, and I’m reading better – more clearly and not that slow – and I feel much more confident.”  Andres, student

This is something teachers really, really needed for management, time, efficiency and effectiveness … I’ll be using this forever and always.”  Jennifer Saikaly Moreno, teacher  Source:  https://news.microsoft.com/features/reading-progress/

A recent 2021 Stanford study showed the pandemic caused a 30% drop in reading fluency in early grades. So Microsoft’s introduction of Reading Progress could not have come at a better time.

How the Microsoft Education Team Developed and Launched Reading Progress

I interviewed one of the Microsoft Education team members, Senior Product Marketing Manager Eric Shuai, who kindly gave me some background on how Microsoft approached the development and launch of Reading Progress, and pointed me to further resources.  The first thing he did was to credit the Engineering team, led by Product Manager Mike Tholfsen:

“The engineering team did an amazing job in the development of Reading Progress with deep empathy for both educators and students. They leveraged academic research, consulted with literacy experts, and solicited feedback from educators and students often, resulting in a barrage of positive feedback from our customers.”  Senior Product Marketing Manager Eric Shuai

Three points stood out for me:

Senior Management supported starting with the problem.

CEO Satya Nadella encourages teams to find underserved, very important problems Microsoft technology can solve – to apply technology to a problem, not to build something just because they can.

Engineering studied the problem deeply before developing a solution.

Source: Microsoft

The Engineering team dug into the pain point, asking why, why, why, and developed deep empathy for what teachers and students are going through.

“… reading fluency is important, but it’s incredibly painful for teachers to do … they hate doing it, it takes them forever, they have to pull the kids out into a hallway where it’s loud, and the rest of the class is going crazy while they’re listening and marking (evaluations) in the hallway.  The kids don’t like reading out loud, and for many it’s stigmatizing.”  Product Manager Mike Tholfsen

A description of the process they followed can be found on Microsoft’s blog.

Once the team had a good handle on the problem, they leveraged their deep experience in AI technology to build a solution that solved the users’ problems, seeking out experts from all reading science methodologies and using Human Centered Design principles to iterate prototypes with teachers and students.

Marketing used storytelling to help convey the benefits.

The Marketing team got such positive, rich feedback from educators that they decided to center marketing communications on their stories (more on this below).  Case studies will be an important focus.

What makes Microsoft’s Reading Progress Such a Powerful Innovation

The innovation itself:

Everett M. Rogers’ Diffusion of Innovation Theory identifies 5 qualities of a successful innovation, as seen from the users’ perspective.  Microsoft appears to be tapping into several.  This is my take – the real proof will come over time through user feedback on the full end-to-end experience.

The decision to use story telling:

As humans we are hard wired to be receptive to stories.  Stories work with all types of learners.  Stories are more memorable.  Storytelling forges connections between people, and between people and ideas.

Diffusion of Innovation theory also speaks to the importance of peer to peer conversations and peer networks in the successful adoption of innovations, particularly after the early adopter stage.  This is because people are more likely to trust innovations that come from people like themselves.

Yes, data will be important to prove the value proposition to customers.  But viewing video of students and educators allows us to vicariously feel the same joy and pride students and teachers are experiencing, which brings Reading Progress’ benefits to life more powerfully than data alone. Video is an excellent media to showcase – versus simply talk about – the full range of functional, emotional and social benefits.

Reading Coach, announced in March, is a reading practice tool for students that builds on Reading Progress and automatically generates individualized exercises based on each student’s specific needs.  The following video makes full use of story telling as it showcases this new tool and shows how it works with Reading Progress.

Source: Microsoft

We believe in making the customer the hero, which in this case was a teacher in Chino, CA as well as a student.  We tried to show how Reading Progress and Reading Coach supports her effort to drive progress and get students excited about reading with real-time coaching and positive feedback loops.  Eric Shuai

The Microsoft Education team is continuing to build on their mission to create a portfolio of literacy tools to reach every learner.

I am eager to hear what comes next, and to see the impact on this generation of readers.  And I will be fascinated to see how other audiences might use this innovation – immigrants learning new languages, for example.

Questions to Consider as You Develop and Launch New Product Innovations:

1. As a senior leader, how can you give your teams permission to seek out and address the most important problems?
2. How can you put users at the center of your product development efforts, and continue to integrate their feedback longer term?
3. What can you do to tap into all 5 qualities of a successful innovation?
4. How can you use storytelling as well as data to better demonstrate the value of your innovation?
5. What can you do to leverage the power of peers to accelerate adoption?

I look forward to your thoughts, as always.

BroadbandUSA’s Tribal Broadband Connectivity Program makes $980 million available for grants to eligible Native American, Alaska Native, and Native Hawaiian entities for broadband deployment, digital inclusion, workforce development, telehealth, and distance learning.

I’m heartened to see broadband inequity addressed in our country.  The challenges are complex, and the proposed solutions showed a high degree of resourcefulness.  But what really impressed me is how the BroadbandUSA grants team leveraged the expertise of private sector professionals to bring greater diversity, rigor, and efficiency to the review process.  And they got this expertise for free.

Yes, we all volunteered.

300 applications, 900 merit reviews, ~ 90 days

The grants team followed a three step process:

• They conducted an initial review of all grant proposals to ensure that the proposals met their qualifying criteria
• They recruited and vetted subject matter experts from telecom, cable and related fields. They trained us on how to evaluate and score the proposals, which required detailed comments to justify the ratings. Then they matched us with grants fitting our areas of expertise.  Each proposal received at least two independent merit reviews. The grants team provided excellent guidance and technical support along the way.
• They then gave an in-depth evaluation of the proposals that passed the merit review process

The first grants were announced November 15 and went to the Taos Pueblo in New Mexico, the Upper Mattaponi Tribe in Virginia, and the Sokaogon Chippewa Community in Wisconsin. Two of the grants will support the provision of broadband services, computers, and digital skills training to tribal members and one will fund a tribal broadband planning project.

Crowdsourcing is not new.  But this is the first time I have seen it used by our government.  I hope this trend continues.

Let me know what examples you are finding!

Removing friction from the shopping process is a strategy that has driven much of Amazon’s online innovation (1-Click ordering, etc.).  And now they are innovating around making in-store shopping more convenient.

For those interested in the technology that enables Amazon Go to track and bill purchases without requiring customers to check out, check out GeekWire’s article which looks into the patents Amazon filed.

The opening of the store to the public followed a lengthy beta test conducted with Amazon employees.

I wanted to see how their experiment was going.  (Plus I wanted to see if it felt like shoplifting.)

As with any new innovation, there are areas for improvement, but overall it’s pretty exciting.

Here’s my shop-along experience, complete with inner monologue.  I find conducting experiential research like this helpful.  It’s a way to think about the customer journey more holistically and identify opportunities for improvement across the end-to-end experience.

If you have already visited in person feel free to scroll directly to the sections on what I’d do to improve Amazon Go, and how Amazon Go opens up possibilities for further innovation from Amazon.

Setting up the app is not friction-free

Source:  Amazon 

First you have to download Amazon Go to your smartphone.  At first I was irritated at this prospect, as I hate being asked to download anything these days.  But the actual downloading was almost instant.  Pain over.  I did wonder why they don’t just automatically include this as an upgrade to the regular Amazon app.  They have all my info.

Once you open the Go app, there is a mini tutorial.  Mental sigh.  Most intro tutorials insist on telling you more than you need or want to know.  History of the company?  No thank you.  But the Amazon Go tutorial is quite efficient.  The tutorial shows you how to use your app to enter the store.  You can replay the instruction or swipe to continue.  The tutorial then takes you through the shopping experience, covering only the most likely scenarios – shopping with someone else – what happens if you decide you don’t want the product – a reminder not to carry other peoples’ shopping carts because your account will be charged.  One question they didn’t address is whether you have to return your discarded item to the same location or whether you can leave it near the exit.  I will have to experiment with a low-cost item.  Something about this excites me.

Once I have swiped and seen their intro, I press “Got it, Let’s Shop,”  then am presented with a Sign In page.  I am slightly taken aback.  I was expecting to go shopping but now they need more information so I am NOT going shopping.

After grumbling at having to enter a password, as I am so done with passwords, I look up my password (an annoying extra step), enter my email and password, and am presented with payment card options from my regular Amazon account.  I select my preferred  card.  I get a message they can’t verify it and ask me to update the card.  Grr.  I know that card works.  I press update card and check “Edit”.  My card is perfectly fine.  Thought so.  I go back to the earlier screen and now the card I selected for Amazon Go seems to be working.  I press “Update Card” and get the same error message.  So I check “Edit”, then check the address.  Aha.  They want me to select a billing address.  Don’t they know my billing address?  Hrumpf.  I select my address from the list of addresses I have previously used to send items to – why did they do that, they should know my billing address  –  and press “Use this Address.”  Save.  Return to earlier screen.  For the third time I press “Set as default card.”  Same error message.  I am officially unimpressed.

I try a different card.  That seems to work.  I am not happy about having to use this card instead of my original selection.

Amazon now wants to know if I would like to get alerts, sounds or badges.  After that experience, NO.

At last, I get a screen with my QR code and a cute little Apple-like message:  Hello, Lisa.  I realize I am now a QR code to Amazon.  But I am a cute little human QR code.

The screen shows a banner across the top telling me the address and today’s open hours which is just what I want to know.  The icons along the bottom cover the areas I care about and address my main questions.

• Key: gets me in
• Discover: I think this is going to address my biggest question, what do they actually sell there, and it turns out they lead with timely offers which is even better – I’d forgotten about Valentine’s Day.  The app shows appetizing photos of the main categories –  they sell beer and wine which requires a valid ID – will I have to show that at checkout?  Will that slow me down?  It’s nice to be able to parse through Discover and see what I might want to get on my visit.  It’s like looking at a restaurant’s menu.  This ability to pre-plan means I’ll be able to whisk through the store even faster.
• Receipts: did you charge me extra?
• About: gives a short paragraph on how Go actually works, which is pretty cool – now I feel I am in the know about Just Walk Out Technology and I am excited to learn they have chef-designed Amazon Meal Kits.

The app shows links to the map in several places which I found handy.  The CTA is clear:  VISIT.

From the food featured, I am guessing that the target audience for this store is tech-enabled 20 or 30 year olds who value the ability to find extra precious seconds of time in their work-oriented lives.   But they still want to eat healthy, and might be even willing to prepare a semi home cooked meal on occasion.

Sounds a lot like the Amazon employee – a good target for this location (next to Amazon HQ) and a good target for the neighborhood.

Getting to Amazon Go

Source: Lisa Fernow

Not being an Amazon employee, I can’t just pop out of my office and walk.  So I drive.  The streets around 7th and Blanchard are under construction, and I don’t see any obvious place to park.  I circle the block and eventually spot a sign for a parking garage.  It says it’s full but there are still spots for retail shoppers.  That would be me.  Relief.  The elevator helpfully tells which floor to get off on.

I step outside and see what appears to be a line to get in.  How ironic.

It turns out it’s a group of tourists taking selfies.  Once I pass them I see crowd control stanchions, fortunately with no people in line, with signs making it clear you need to download the app before entering.  This feels pretty friction-full.

A friendly greeter offers me a shopping bag.  I feel welcomed and mildly like an insider:  I have just been given Amazon swag.

I have a little trouble scanning my key.  I want to swipe.  The turnstile wants me to hold my phone still.  Same friendly greeter helps me and manages not to make me feel like an idiot.

It’s not shopping.  It’s not shoplifting.  It’s a sortie!

Source: Wikipedia

Once inside I immediately see a section called “Eat Now”.  It’s perfectly laid out for grab-and-go.

The offerings are inspired by cuisines from all over the world.  The sandwiches are from local bakeries and sandwich shops.  They have an enormous yogurt selection.  Not just yogurt – the point of sale says Icelandic yogurt.  Really appetizing options.  I wonder how well they are optimizing their shelf space.  Hope someone from Whole Foods is advising them.

It’s after lunch and they are out of stock in many items.  Disappointing.  I was hoping to try one of the middle eastern inspired sandwiches but all that’s left seems to be various nationalities of chicken.  I eventually select a burrata caprese sandwich with roasted red peppers on ciabatta roll which turns out to be delicious.

There are no bananas or other individual fruits for sale.  Guess Amazon technology can’t handle that.

I see a sign indicating the “Eat Later” section and wander in to see what’s there.

There is a freezer section of meals, including Beecher’s Mac and Cheese which is a go-to dinner when I am feeling in need of comfort food, and a small shelf of staples in case I happen to be out.  I wonder who in the target audience is actually cooking meals from scratch.

I find the wine section and am pleased to see a decent selection.  I pick out a bottle of Airfield Estates Chardonnay, a local winery.  The wine area is guarded by a polite employee who cards me.  Ah ha.  That’s how they get around the legal age question.  I ask him if he can help me switch to my preferred credit card.  He refers me to another employee who in turn suggests I contact customer support.

On my departure I am thanked for coming.  Nice touch.

As I exit the parking garage I think, I wish Amazon Go could automatically charge my parking fee.  My experience at Amazon Go has already subtly changed my expectations about paying for things.  When the gate arm lifts it turns out I have not parked long enough to be charged.  Woo hoo!

Later I get a notification app that shows what I bought, along with pictures and prices, and tells me my trip time was only 05m 16s including the wandering.  Nice reinforcement of the time savings benefit.

Amazon Go is not really a supermarket.  I’d say Amazon Go is closer to a mini-mart or c-store, or even a walk-in vending machine.  It’s all about convenience.  I was expecting to feel a little bit naughty, or triumphant, at having come out of a store without paying.  Or dazzled by the technology.  Instead I felt … nothing.

But for the convenience seeker, that’s how it should be.  In and out.  As easy and as unobtrusive as breathing.  That’s what it feels like when an experience is without friction.

What I might do to improve the current experience

Amazon got a lot right, and it’s only a few weeks into the public launch.  But even the launch of a conventional store requires a shaking down period, and Amazon is testing an entirely new concept.

There is still plenty of perceived and actual friction to overcome before the full end-to-end experience becomes truly seamless.

If the idea is to serve office workers and reduce the time and mental effort it takes for them to get their eat-now or eat-later food here are some things I might test.

The app:

• On downloading the app tell people to sign in to connect the app to their Amazon account and preferred credit card before telling them to go shopping
• Enable customers to sort by cuisine they’re in the mood for
• Enable people to pre-order items and pick them up from the store – or better yet, deliver them. This way customers don’t worry their selection will be taken – mental friction – and Amazon can better manage demand
• Stream a live feed to show how crowded the store is, so people can time their visits
• Show what’s in- and out- of stock in real time
• Include nearby parking lot locations and available parking spaces – ideally sync up with a parking app to reserve a space (not relevant for people in nearby offices but helpful if Amazon wants to attract other shoppers)

The store:

• Provide a place in the entryway, out of the rain, for people to sign up for the Amazon Go app in comfort
• Find a way to sell individual pieces of fruit and other lunch or snack foods that are generally sold by weight. Amazon bananas!
• Optimize merchandise mix and out of stocks – leverage Whole Foods expertise. Perhaps include a few more non-food items office workers might urgently need:  phone chargers?  Flowers?
• Sell (or give away) Amazon Go thermal bags so people can buy dinner items at lunch and keep them cold
• Train store employees to assist with technical support (credit cards, etc.)

What’s next?  What else Amazon could experiment with based on their Amazon Go learnings

From a customer experience perspective I don’t see Amazon Go technology being installed at Whole Foods in its current state, unless they create a self-contained store-within-a-store with a separate entrance, for a few reasons.

• Not every Whole Foods shopper may want to sign up for the Go app.
• There are important categories – bulk foods, fruits and vegetables, pharmacy – that the Just Walk Out technology probably can’t accommodate.
• For pantry-loading shopping occasions, reducing the checkout line won’t significantly reduce total shopping time.
• And part of what some people get from going to a conventional grocery store is the social interaction with store employees. Convenience is not for everyone.  In a fascinating NYT article, The Tyranny of Convenience, Tim Wu makes the case that convenience has a dark side:  “With its promise of smooth, effortless efficiency, it threatens to erase the sort of struggles and challenges that help give meaning to life.”

But I can easily see Amazon Go mini-marts work in other office buildings.  This could be a way for Amazon / Whole Foods to expand their retail footprint to capture occasions currently unavailable to them.

Other things Amazon might try:

• Integrate Amazon Go, Amazon.com, Amazon Books and Whole Foods back end systems and loyalty programs.
• Make it easier for customers to sign up for, shop and manage their account across all retail channels, on an opt-in basis.
• Allow customers to see their total Amazon and Whole Food shopping history in one place.
• Allow Amazon to suggest items to get from Whole Foods or order from Amazon.com based on their Amazon Go lunch preferences.

Long term, as customers adopt checkout free shopping, Amazon might consider licensing their technology to other retailers.

The possibilities are exciting, and I will look forward to seeing what innovations Amazon experiments with next.

All systems Go!

This post was originally published by the American Marketing Executive Circle.

According to the organizers, FuckUp Nights is the fastest growing global movement of entrepreneurial people who come together to publicly share failure stories. Thousands of people attend FuckUp Nights each month in 200+ cities worldwide. Esquire Magazine says it’s “like TED talks with more booze and less pomp.”

When our bosses/companies/investors/society/insertyourowngrouphere ask us to be 100% successful all it does is to force us to stop taking risks and instead work to appear 100% successful. It’s unrealistic. It’s unhealthy. And it’s unproductive.

So I was tickled to see entrepreneurs come out of the closet and admit, hey, we screw up!

Why is f*cking up so important to innovation? We try more things. And we learn more.

Why Frito-Lay embraced failure

Leo Kiely, VP of Marketing at Frito-Lay in the ‘80s, used to walk around the office with a baseball bat late at night when we were all feverishly working away on our marketing projects.

He wasn’t there to beat us up. (We did that to ourselves, thank you very much.)

He was there to silently remind us that it was important to take a batting average mentality to our work. If we weren’t swinging and missing, we weren’t taking enough chances. As long as we learned from our mistakes and didn’t repeat them, we were good. To innovate, we needed to embrace mistakes as part of the process.

We celebrated our mistakes in public. When a marketer made Director, there was a mini ceremony where that person’s failures were paraded in front of the whole group for us to enjoy. The point was clear: you made Director in part because you took chances and occasionally fell flat on your face.

Frito-Lay was and is one of the most high-performance cultures in the US, and has consistently shown high financial returns – so they are doing something right.

Embracing failure is just one way to cultivate an innovation mindset – but it’s one of the most powerful.

More reading to inspire you to f*uck up

• Why Failure is the Foundation of Innovation Inc.com
• The Miracle of Making Mistakes Harvard Business Review
• How Warren Buffet taught this legendary investor the value of making mistakes CNBC

I’m going to the event in Seattle, and looking forward to making my next mistakes.

Look forward to your thoughts.

This post was originally published by the American Marketing Executive Circle.

Medify basically collects these databases in one place and allows people to search on the exact criteria they are looking for.

Source: Medify

Streat decided to go after the consumer market as a B2C play – the need was clearly there for patients and their caregivers. At that point the question became which medical conditions to focus on – such as Alzheimer’s, asthma, autism, breast cancer, kidney disease, leukemia and lymphoma – so they could build out their databases accordingly. Their VC was strongly encouraging them to focus on one of these segments as an initial target audience.

Startups have a particularly urgent need to get the target right for their innovation, because it affects how they build out their product or service, and they have to show results before they run out of money.

But sometimes its hard to evaluate which target is the most viable. There are often many to choose from.

A framework for thinking about targets

Here is a framework I developed with my various clients over the years to help startups assess the attractiveness of possible targets.

The high level criteria required for a viable target are straightforward:

The real power in the framework is that it allows you to build out each of these four buckets with further qualifying criteria to suit your business situation, as in this example.

When you find you have two or more equally viable targets, consider what the tie-breaker criteria should be. For startups, it’s often how quickly you can get to market. If you are concerned about showing traction to your investors, a medium-sized target that is willing to buy now is more attractive than a large target that requires a lengthy sales process.

In Medify’s case, once we spoke with the physicians, hospitals, insurers, drug manufacturers and advocacy groups who made up the health care ecosystem, and aligned our findings against this framework, it became clear which conditions – and therefore which target segment – had the most potential for their innovation.  Once they landed on this, they could solidify their value proposition and build out their product offering.

I look forward to hearing your thoughts.

This post was originally published by the American Marketing Executive Circle.

Macro trends are big social and economic shifts – technology, consumer demographics, culture, or historical turnings – that can reshape markets and create big new opportunities. When you pay attention to the horizon, you can see macro trends coming your way and have time to prepare for and capitalize on them.

In the natural world, scientists are making it easier than ever to tell if a tornado will hit.  The National Weather Service has an experimental strategy, Warn on Forecast, which allows forecasters to issue warnings before storms form, based on high-resolution satellite imagery, radar data and surface observations. This data is fed into a very high-resolution weather model that is run every 15 minutes for a period of time on storms of interest or for areas that could produce storms. The net benefit is that citizens have a lot longer time to respond.

But we don’t have early warning systems in the business world (at least, not this accurate).  And not every macro trend we see in the business world requires a full-out corporate response.  As marketers we need to evaluate trends and decide what to do about them.

An approach I have found helpful is inspired by how communities respond to real tornadoes:  spot the trend, describe it, understand it, predict its impact, and act.

Ten questions to assess macro trends

1. Where do trends ultimately affecting my business tend to start? (spot)

If you track back previous trends that have had an impact on your business, you can to identify some of the sources of these trends.  What past trends can you trace back to their beginnings?  Is there a pattern?

2. What are the warning signs? (spot)

Consider what early signs you could look for and how to measure them, to get further ahead of what’s happening.  For example, if you want to know what’s coming to your grocery store in the next year or two you might want to attend the Aspen Food & Wine Magazine Classic.

3. What trend do we see on the horizon? (describe)

How would you describe the trend?  It might be expressed as a new interest, an emerging concern, or a major shift in consumer attitudes or behaviors.

4. What are the roots of this trend? (understand)

Consider the history of the trend and its causes or inspirations.  Is this trend sparked by a single event, or is it part of a major historical cycle?

5. How fast is it developing / gaining in popularity? (understand)

Are opinion leaders embracing this trend?  Does the trend appear “sticky”?

Diffusion of Innovations theory tells us that when about 16% of the population adopts a new innovation, it reaches a tipping point where people think “everyone is doing it” and adoption accelerates.

6. Who or what will be affected?  (understand)

Consider who, and how many, will be affected.  Will this trend impact your core customers?  What other important constituencies, such as strategic partners, will be affected?

7. What will happen – good or bad – when the trend does take hold? (predict)

Role play what would happen to those affected if the trend takes hold.  What’s the initial impact likely to be?  What follow-on impacts will this cause, in turn?  What scenarios can you envision?

8. What are the likely consequences? (predict)

What are the benefits or how serious will the negative consequences be if the trend takes hold on a large scale?  If they are significant and long lasting, the trend requires a response.

9. What to do about it?  (act)

There are four main strategies for responding to trends:  embrace, counter, deflect, or ignore.  If you believe the trend will stick, and your company is likely to benefit, consider associating with the trend and building products or services to further capitalize on it.  If the trend is likely to threaten your business you can argue against it (counter) or try to change the conversation (deflect).  But if your most important constituencies aren’t affected, consider masterly inaction (ignore).

10. How shall we do it? (act)

Once you decide on your overall strategy, now you have the task of forming a specific plan and assigning people and resources.  Even if you have decided to ignore at trend, you’ll still need to communicate your reasoning to your constituencies.

______________________________________

In the natural world, when a tornado hits, your range of actions is pretty limited:  hope it doesn’t touch your neighborhood, try to out run it, or retreat to your underground bunker.

In business, we have more options, as long as we take a careful look at the trends coming our way.  I hope the questions above will help you evaluate and respond more effectively.

What’s your process for evaluating macro trends?  I’d love to hear.

This post was originally published by the American Marketing Executive Circle. 

(Main photo source: https://weather.com/news/weather/news/experimental-model-weather-tornado-warn-on-forecast)

Amazon has been in the news a lot lately, and rightly so. It’s fascinating to be sitting in their back yard where I get to see some of these innovations for myself.

In early 2017 they announced an experiment with Amazon Go, a cashier-less store of the future which hasn’t opened yet due to technical issues.

(Source: Recode.net)

They are also experimenting with formats that allow customers to buy their items online, schedule time slots to pick them up, and drive to the pickup location where employees will deliver orders to their cars.

(Source: Seattle Times)

And in June Amazon introduced their Dash Wand with Alexa which lets you scan the bar codes for the items in your fridge, or just call them out – mushrooms! – to save to your shopping cart. It even helps you figure out what to do with the food you already have.

And when Amazon announced they would acquire Whole Foods for nearly $14B it sparked a whole lotta news.

Amazon’s latest acquisition of Whole Foods: a few industry perspectives

Local high tech publisher GeekWire’s story by Todd Bishop speaks to how the Amazon acquisition of Whole Foods grocery chain dramatically expands their physical retail footprint.

Felix Richter’s article in Statista speaks to the opportunity for Amazon to use Whole Foods’ distribution and procurement network to boost its online grocery offerings, to further penetrate the U.S. online grocery market – currently the ecommerce market for fast-moving consumer goods (FMCG) sales in the U.S. is only 1.4%, compared with 16.6% for South Korea.

A recent NYT article by Claire Cain Miller speaks to the acquisition signaling the end of the line for many cashiers.

And the Harvard Business Review article by Bill Taylor on Amazon, Whole Foods, and the Future of the (Old) New Economy offers a very thoughtful look at what the deal says about the future of an approach to business, branding, and organizational culture that Whole Foods and Amazon have come to represent.

I think all of these perspectives are valuable, but so far I have not seen anyone comment on what all of this means for the customer experience. As marketers I imagine we are all thinking about this question. So here is my take, and I welcome your thoughts:

4 marketing strategies Amazon seems to be following: a consumer perspective

The Amazon mission statement makes it clear what drives them – it’s serving consumers:

“Our vision is to be earth’s most customer-centric company; to build a place where people can come to find and discover anything they might want to buy online.”

I’m seeing this mission statement brought to life in a few ways:

1. Making Prime more valuable so more people sign up

Just as Gillette once priced their razors low so they could make money on razorblades, Amazon is looking to drive penetration of Prime membership so they can make money on what customers order. Part of the way Amazon markets Prime is by making this membership simple to get. But they are also working to make Prime more valuable, for example, if you sign up for Prime you’re the first group to get access to just about every new device or service they offer.

This includes getting Whole Foods products delivered to your doorstep.

Grocery is not in itself an attractive category – the margins are terrible. But offering grocery as a new category for home delivery increases delivery frequency, and once customers are ordering groceries regularly they’re also throwing in other products, which is attractive.

2. Lowering costs to consumers

When Amazon got into the e-book business they dropped the price to such a low level it put at least one publisher out of business.

Some analysts are already talking about the possibility of Amazon doing this for Whole Foods products.

3. Eliminating friction from the buying process

Consider everything Amazon has pioneered or pursued to make it as easy as possible to buy something from them online: low prices, one-click shopping, easy checkout, easy returns, free shipping.

In store they are experimenting with skipping the cash register entirely. With the Amazon Go app you’ll no longer need your wallet.

With the Dash Wand with Alexa you don’t need to write down your shopping list.

It wouldn’t surprise me if Amazon closes deals with smart refrigerators using Internet of Things (IOT) to automatically reorder your groceries for you, through Amazon of course.

What this eventually all adds up to …

4. Eliminating thinking altogether?

Every marketer works hard to build top of mind awareness and strives to get into the considered set. Amazon is working hard to become the only company you think of when you buy anything.

As a Prime Member, I now default to Amazon when it comes to buying online. After all, I have already paid my $99 for “free” shipping. No matter that this is a sunk cost: psychologically, I’m still trying to get more return from that investment. Amazon is happy because I’m finding new things to buy. I once used my Prime Membership to buy potting soil.

Yes, Amazon sent me dirt.

If you’re not at the table, you’re on the table 

So what does this mean for marketers? Here are 3 resources to help you understand Amazon and what it might mean for your business:

1. John Rossman’s blog is a great place to get a former insider’s perspective on Amazon’s strategy. In talking to him my sense is that he still has a great finger on the pulse of how this company thinks.
2. To stay on top of what Amazon is doing, a great resource is GeekWire.
3. To see what Amazon is about to do, a great resource is CB Insights, which uses their patents search engine to track Amazon’s intellectual property efforts.

While every situation is different, here are 3 strategies to consider if your company lies in the path of Amazon:

1. Hunker down. Prepare for the long haul. Right now Nordstrom, after taking a beating from Amazon, is talking about going private. My guess is, they expect a battle and don’t want to be distracted by pressure to make their quarterly numbers.
2. Double down. Amazon can sell a lot of things to a lot of people, but they can’t sell everything to everyone, much as they would like to. What is it your company does better than anyone else, for a particular audience? How can you become the top of mind choice for this group?
3. Reconsider your options. What business are you really in? Look at this not from the perspective of what you’re selling (buggy whips: product – oriented) but from the perspective what people are buying (transportation: customer – oriented). Ted Levitt’s famous Marketing Myopia article is even more relevant today.

I look forward to hearing how you will be responding!

This post was originally published by the American Marketing Executive Circle.

(Main photo source: Geekwire)

If you work at a large organization you may have anthropologists on staff, or you may engage outside firms to conduct ethnographic research, as in this excellent Atlantic article. And if you can observe these experts in action, that’s ideal.

But there’s also value in doing it yourself, practicing on “friends and family” who use your product or service. The better you understand your customers’ problems and aspirations, not only on an analytical level but on a gut level, the better your innovations will be.

Come on in, the water’s warm

I’m the first to admit, it’s hard to clear my calendar to actually spend quality time with customers.

But every time I do I learn something I never expected. And I come back inspired with fresh inspirations.

The idea is to observe, listen and understand as much as possible. Avoid the temptation to “help” (at least not initially). Take notes and ask open-ended questions to understand customers’ jobs, pains and gains.

3 DIY immersion Ideas

Here are 3 simple DIY immersion ideas to consider.

1. Go to where your consumers live (literally).

In the case of fashion, you might ask people to show you their closets to better understand how you could meet more of their wardrobe needs.

Examples of questions: What are their go-to outfits, and why? What haven’t they worn in five years, and why are they keeping it? What’s missing from their closet, and why?

In the case of food, you might ask people to show you their kitchens to understand the role various products play in their lives. What’s in their pantries and their refrigerators? How did it get there? What occasion is it for? Who prepares this? Who eats this? Why is this out of date item still here?

2. “Shop along” with your consumers.

It’s fascinating to go shopping with your customers to understand what makes their shopping experience enjoyable and productive (or not).

If you’re a retailer, for example, you might investigate questions like: Where in your store do your customers go? What path do they follow? What do they pick up or avoid? How long do they spend in the store? What do they buy, or not buy? You can also ask them to give voice to their inner monologue as they shop.

If you’re a manufacturer, you might investigate questions like: Did they actually see your product on the shelf? Did they consider your product or not? What else did they consider? How did they decide?

3. Ask your customers to show you exactly how they use your product or service.

If you’re selling auto accessories, you might ride along with your customers for a day.

If you’re selling software as a service, you might join them at their mobile phone, tablet or computer to watch them go about their business using your service.

For online shopping sites you can conduct “surfalongs.”

What tasks do they need to accomplish? Where do they run into problems? What do they gain by completing their task? What solutions do they use today and how well do they work? How can you help?

When to conduct customer immersions

If your quality or satisfaction ratings are slipping, you sense your customer experience isn’t resonating, or your customer base is changing, or you just want to refresh your understanding, these are ideal times to use a DIY customer immersion (and perhaps engage an outside expert).

Inquiries can also be undertaken when you want to refocus your team on the consumer. If you are in a business that regularly refreshes its products or services, you can time this activity to fit your product development process. You can also integrate this practice into your annual planning.

I can’t wait to hear what fresh innovations this inspires.

This post was originally published by the American Marketing Executive Circle.

(Main photo source: http://acquandastanford.com/anthropology/)

This time I thought it would be useful to talk about a best practice you can use when you do have a chance to step away from your daily routine.

I call it Tornado Sighting. Otherwise called: keeping your eye on macro trends.

Macro trends are big social and economic shifts – technology, consumer demographics, culture, or historical turnings – that can reshape markets and create big new opportunities.

When you watch the horizon, you can see trends coming your way and have time to prepare for and capitalize on them. Understanding macro trends can also prevent you from being sideswiped by something you didn’t see coming.

Three ways to use macro trends to innovate more successfully

1. Research trends that could affect your business

Several years ago, the New England Journal of Medicine published a study on the Atkins Diet that showed people could lose weight by shifting their dietary intake from carbohydrates to protein. This was reported widely by the media, sparking consumer interest that quickly developed into a craze. The newly appointed U.S. retail president of Sara Lee wanted to understand how this trend would affect the company, which makes both Jimmy Dean sausages and other meat products (Atkins-friendly proteins) as well as pound cakes (evil carbohydrates).

We researched the literature and interviewed a variety of experts: the medical community, scientists, influential chefs, food trend researchers, manufacturers, media and consumers.

It became clear that the Atkins Diet would soon lose popularity, and that the much bigger issue would be obesity, which was not yet getting much press. Sara Lee was able to develop products and marketing plans that addressed the true long-term trend and avoid the distraction of launching short-lived products tied to what ultimately proved a diet fad.

Ask your team to search for information on a continuous basis, and report back on what trends might be coming your way. You can start with global macro trends from sources like Euromonitor for inspiration. Once you have a handle on which trends you want to pay most attention to, assign individual members of your team to each issue, to set them up as internal experts.

2. Identify and learn from your expert network

Of course, you can’t become an expert on everything, and the good news is that you don’t have to. There are plenty of people out there to learn from.

If your target audience is millennials, for example, find out who understands them well. Experts could include other companies marketing to the same target, psychologists, intergenerational consultants, even a panel of Millennials themselves. Follow their work; potentially enlist their active help.

If your company is incorporating virtual reality (VR) as part of your customer experience, for example, find out what companies are pushing the boundaries on VR and related technologies, what reporters and analysts are covering them, and follow them. CB Insights, a publication that serves the venture capital community, covers emerging startups and is a good place to hear about new technologies.

Conferences are a great way to immerse your team. This is also a great time to bring in your agency, as they are in the business of understanding different target audiences, technologies and cultural trends.

3. Build macro trends into your annual strategic planning process

At Nordstrom, in preparation for a Board meeting, we were once asked to investigate “What’s the future of service?” This was an interesting question coming from Nordstrom, as they are considered by many to represent the ultimate in service. But Nordstrom is humble enough to realize that they had to continue to earn that reputation every day.

We conducted secondary and primary research, including online anthropology, to understand how people talked about service, what companies they associated with great service, and why. One of the key findings was that service didn’t have to involve people – wow. The Board and executive team immediately saw the implications for Nordstrom’s brick-and-mortar stores and online business. As we see the rise of Amazon in fashion today, it’s obvious that they have begun a major competitor. Nordstrom will continue to evolve to serve their customers better.

It’s good discipline to look at macro trends as part of your strategic planning process. Make this its own section. Report on macro trends you see on the horizon and the strategic implications for your company. You can own this yourself, but it’s even more effective if you can invite your counterparts from other departments to contribute their thinking as well.

Now what?

It’s not enough to simply become aware of what’s going on, obviously. You’ll need to decide what should you do more of, less or, or change. to stay competitive.

What macro trends should you be paying attention to? I’d love to hear. 

This post was originally published by the American Marketing Executive Circle.

(Main photo source: http://www.csmonitor.com/Science/2011/0418/Can-you-outsmart-a-tornado-Take-our-quiz/warning)