atkinson advisor

Onward – How Starbucks Fought for its Life without Losing its Soul

By Howard Schultz

In 2000 Schultz stepped aside as Starbucks CEO to focus on Starbucks’ international expansion.

By 2007 the recession, overexpansion, and changes in consumer behavior were affecting every aspect of Starbucks’ business.

In an unusual move for a former CEO, Schultz decided to return to lead the day-to-day operations in 2008.

Onward gives readers an inside look at Schultz’s concern that Starbucks was at risk of losing the customer-centric focus and the agonizing task of finding the balance between product quality, core values, and profit.

In his return Schultz took a number of risks not popular with Wall Street or customers. In 2008 he shut down all 7,000 stores for three hours simultaneously so that baristas could be retrained in the art of making the perfect espresso. And he removed the breakfast sandwiches from the menu until they could find a way to keep the cooking smell from competing with the experience of walking into a coffee shop intended to delight the senses.

Onward is a must-read for all students of leadership, management, and consumer marketing.

By David Meerman Scott

Sixteen years ago websites started out as “brochureware,” static sites that were merely online versions of sales catalogs and annual reports. They’ve since evolved into what Scott calls a “real-time marketing (and sales) machine.”

Scott’s latest manifesto is a 13-page free download that explains how and why companies can use the information that web visitors give them to follow up on leads quickly.

That’s important because prospects and customers expect answers to their queries almost immediately. When they fill out a form on a website to request information, the company that sends a reply within 5 minutes instead of 2-3 days stands a much better chance of winning that sale.

To take advantage of the real-time nature of the web, companies need two things: a way to capture prospect information on their website (webinar registration, eNewsletter subscription, survey, etc.) and an automated way to distribute that information internally to a salesperson who can follow up. Scott gives an example of a wedding photography company that features different offers, then prioritizes leads and funnels them to the appropriate person.

The key is testing—come up with a few different offers of your own and see what gets the most response.

Interruption is a staple of any consumer marketing. Marketers interrupt television shows with commericals. Billboards interrupt your drive to and from work. Spam interrupts your e-mail inbox.

Here’s the rub: consumers are building up strong interruption immunity. You see on average 4,000 interruption messages a day. How many do you remember from yesterday? (We remember this one out of the thousands we saw.)

We’re moving very quickly from a world where we demand simultaneous attention from a group of people to a world where we earn attention one person at a time.

By Scott Stratten

We picked up a copy of Scott Stratten’s new book a few weeks ago at the Nashville stop of his “UnBook Tour.” In UnMarketing, Stratten calls for reconsidering traditional sales and marketing tactics like cold-calling and, instead, focusing efforts at the top of the Hierarchy of Buying.

Current satisfied customers are at the top, then referrals by a trusted source and current relationships that have yet to purchase. Cold-calling and search through ads are techniques that target the bottom of the pyramid. Competition at the bottom is fierce, and your chances of reaching a receptive audience are slim.

Stratten argues that business is built on relationships, and social media is one way to build and strengthen those relationships with clients and prospects. He provides some case studies for how (and how not) to engage with influencers through social media and gives good tactical advice for increasing newsletter subscriptions and dealing with defectors in blog comments.

Stratten practices what he preaches. Instead of calling around North America to try to find venues that would book his tour, he used Twitter to engage with his audience and asked which cities would be interested in hosting him. It worked. His 30-city tour will run through Dec. 4.

All buying decisions are selfish. They just are. Consumers buy the product that makes them feel better about themselves.

This applies to personal decisions – “I look good in this suit.” – and business products – “The boss is going to notice my good work.” Or it could be, “I’m not going to get in trouble for recommending XYZ Company.”

These decisions don’t involve the features that marketers so often turn to when selling products. “I look good in this suit” doesn’t make reference to the color, the cut, the craftsmanship, etc.

Transforming features to personal benefits is an enormous challenge. Fortunately, researchers have invented a tool to help.

The Benefit Ladder is a process for understanding the personal benefits of your products and services. Here’s how it works:

• Take a feature of your company’s product or service.
• Ask yourself, “What does this do for my customer?”
• And then, “Why does the customer care about that?”
• And then, “Why does the customer care about that?”
• Stay with the process until the answer is, “It makes my customer feel good about herself.”

The personal benefits will be clues to help you develop more relevant and personal messages that connect with customers.

Kudos to Sonia Simone from Copyblogger and Remarkable Communication for introducing us to the benefit ladder.

YOUR TURN: How do you help customers better understand benefits of working with you?

Creating Competitive Advantage by Jaynie L. Smith

Smith’s thesis is just as relevant today as when Creating Competitive Advantage was published in 2006. In fact, it may be even more critical in today’s increasingly competitive environment.

One of Smith’s most important points is that companies often confuse strengths for competitive advantages. They focus on strengths such as integrity and client trust, which are great and essential to business.  However, these strengths are not competitive advantages.  Some of your competitors likely have these strengths.

Her definition of competitive advantage is the “reason people do business with you.”  It’s what your competition doesn’t have, what allows you to close the sale.

A competitive advantage must be quantifiable, i.e. it must have supporting proof points. 

The following statement is not a competitive advantage:  “Our people are the best in the industry.”  However, it become a competitive advantage when you add:  “Our engineers have a minimum experience of 15 years in the business, twice that of our nearest competitor.” It gets even better when you can add the customer into the mix: “Our clients realize a 4x return on investment because our engineers average twice the experience of our nearest competitor.”

Smith cautions the reader, “Remember that competitive advantages are always moving targets.  You have to review your own, and your competitors’, at least quarterly.  Business is a chess game.  You need to think two or three moves ahead if you expect to win.”

YOUR TURN: What book helped you get a competitive edge in business?