Friday August 13, 2021
Marketing is a Different Game in 2021
The era of challenging brands and comparing yourself to the "leading competitors" feels like a bygone era (point in fact the cola wars turned 40 last year, nobody won). Brands today seek for personal stakes and to stand out from competitors purely on their style and value propositions. To be well-branded is to be unique, thus comparisons have become very non-chiq.
"What's a Pepsi?"
So why the change? The easy answer is just to say that change happens to everything, things do that. The lazy answer is to shrug and say "probably the internet or tubes or something". The internet is a factor absolutely, but saying so doesn't paint the whole picture.
Abundance vs. Scarcity
The truth is that the Internet didn't end the Cola Wars, they're very much alive and well today. In terms of brand image however, the world suddenly and ironically became a far more intrinsically motivated place. People stopped caring what the brand "leader" is, just what's simple, special and available. The need to stand out by pushing someone else back is gone, the goals quickly moved just to being there.
We call these two perspectives Abundance and Scarcity, and they're fundamental to how businesses, economies, and people operate. How we operate in times of abundance and times of scarcity are often entirely different, and it can have an influence on human behavior right down to our thoughts. "I can't leave this job", "I can't afford that", "I need more (x)", are consequences of living in scarcity.
Truth is, most of us have to choose one kind of scarcity or another. Scarcity of time, finance, relationships, the unfortunate balance of life is that a long-term focus on one thing will lead to a loss of attention to something else.
I'm speaking to the human condition writing about this. It's a challenging situation and it doesn't come with a roadmap or a clear solution.
Starting a Business Demands an Abundance of Action
There's a rule in business that services can happen in three ways: Good, Cheap, or Fast. It's a dated but effective reference to go for fast food as a prime example: the service and the products are fast and cheap, at the expense of health.
Before you Start a Business, understand your situation. Not only ask yourself "What do I do and how do I do it", but ask yourself "What do my clients need and how do I deliver it better than anyone else". People often think about the first problem but do not give nearly enough consideration to the second.
A point I often return to is that new businesses often fail to produce revenue and even cost money in their first year. Running a real company is an expensive endeavor.
For a prime example (pun intended) in 2016 Amazon.com's shipping revenue climbed to 8.6 billion while their shipping and handling costs rocketed to an extraordinary 16.2 billion, nearly double their revenue.
Bezos was not quoted saying "I would like to thank my incredible corporate debt"
How to Break the Cycle of "Saving Money = Making Money"
Revenue. Revenue is the name of the game.
Before you invest in that shiny new business idea, before you start digging out your plans and calling up your friend who does graphic design, do not simply ask but prove this essential business concept to yourself: How is my business going to make revenue that I can invest.
Without revenue, without capital investment, businesses stop.
It's not your investors job to make your business money, investments do not equal revenue. Employees are not investors either, they're investments. Employees and contractors provide necessary services to your business for an exchange. Designing a profitable business model where these investments will yield profit is your responsibility. Put the assets in place, and track and measure so you can adjust the formula to optimum efficiency and profit.
To approach business with a scarcity mindset is to say to yourself "how little can I get away with paying for this project", "who is going to do this for me", "I expected you to do it for free".
You aren't helping anyone thinking like that, including yourself (I coined the term entre-consumer to define this style of thinking). You decided to start a business, and running a business means expecting to pay for investments. Expect the expense and prepare for it by finding clients and selling your product.
Your focus should be on increasing revenue, not on pinching every penny. I am constantly shocked when I hear a small business owner upset about a $20 bounced check fee and then spending an hour on hold with the bank to request a refund - especially when this same small business owner bills their customers at $100 / hour! You just lost $80.
Don't be an Entre-consumer, seek to capitalize your business by producing (as I've written before, you can find your first client before you have a finalized product). Avoid trying to get ahead by taking others down and instead put your energy to tackling projects and building your client base.
After all, a Lion doesn't need to Roar to know it's a Lion.
Mindset isn't a topic I often dive into much, but what I do like to talk about are solutions. If you're looking for some tricks about how investing money in your business can lead to fast returns, here is a video: