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Avoid Being the Low-Priced Competitor

October 14, 2020 By Nagesh Belludi Leave a Comment

In determining how much you’ll charge for your products and services, explore the “price umbrella”—how others are charging for competitive or comparable products.

The key to pricing is knowing how much your service is worth for your client. Charge too little, and you’re short-changing yourself and making your client speculate, “If she’s decent, why does she charge so little?”

Avoid being a low-price competitor. It’s a terrible habit. Don’t announce, “I’m new. I’m trying to get established. Therefore, I’m offering my service for less than the existing players. Please buy from me.”

Jim Price, an entrepreneurship lecturer at the University of Michigan-Ann Arbor and author of The Launch Lens: 20 Questions Every Entrepreneur Should Ask (2018,) calls this “apologetic pricing.”

Instead, consider the “proud pricing” approach: “We’re launching this business because we firmly believe in our unique value proposition; we look forward to explaining that to customers and charging a premium price for a superior product.”

Positioning yourself as the low-price market offering is a competitive strategy that tends to only work for large, undifferentiated retailers and similar businesses, and it is a poor prescription for entrepreneurial startup success.

Being the low-priced competitor tends to require massive operational and financial scale and often results in an undifferentiated product or service offering and a business with very narrow profit margins.

Idea for Impact: Don’t get stuck in the race to the bottom to be cheaper. Marketing expert Seth Godin has reminded, “Cheaper is the last refuge of the marketer unable to invent a better product and tell a better story.”

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  4. Unpaid Gigs for ‘Exposure’—Is It Ever Worth It?
  5. Your Product May Be Excellent, But Is There A Market For It?

Filed Under: MBA in a Nutshell Tagged With: Career Planning, Creativity, Entrepreneurs, Marketing

How to Create Emotional Connections with Your Customers

September 21, 2020 By Nagesh Belludi Leave a Comment

Consumers are shifting towards memorable experiences over material objects that bring happiness and well-being. Experiential consumption is increasing—the global spending on travel, leisure, and food service is estimated to grow from $5.8 trillion in 2016 to $8.0 trillion by 2030.

Businesses are responding by offering indulgences (think Apple products,) enhancing shopping experience (ordering and carrying-out Domino’s Pizza,) and creating more intimate experiences (Mastercard’s Priceless campaign) for consumers.

One particularly edifying case study is Unilever’s Persil brand of laundry detergents (Unilever licenses this brand from Henkel in many countries.) As part of the “Dirt is good” campaign, Persil’s sentimental adverts that remind “learn to be a kid” (clip,) “climb a tree, break a leg … that’s part of life” (clip,) and “dirt makes us equal” (clip) have attempted to connect with consumers emotionally.

Persil bucked the longstanding ritual of creating dull adverts for its dull products (cheery moms grabbing washing baskets and fragrant flowers and butterflies rising from the clean laundry.) Persil doesn’t focus on the detergent’s stain-busting attributes. Instead, Persil’s campaign signals that children must feel free to experience the world around them regardless of the impact on their clothes. One prominent advert (clip) presented a cheerless robot who slowly transforms into a child while playing in the open air and splashing around in a muddy pool during a rainstorm: “Every child has the right to be a child. Dirt is good.”

Even the UNICEF commended Unilever for “creating awareness of children’s right to play, the right to express themselves—in short, the right to be a child! It encourages parents to see the value of exploration, play, activity and exercise as critical to children’s development and important for full and healthy lives, even if it means that children get dirty in the process.”

Idea for Impact: Enhance how your customers see and feel the benefits of your products and services. Promote an emotional connection between products and customers.

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Filed Under: Business Stories, Effective Communication Tagged With: Creativity, Emotions, Likeability, Marketing, Parables, Persuasion, Skills for Success, Winning on the Job

How You See is What You See

August 15, 2020 By Nagesh Belludi Leave a Comment

So very often, we don’t give ourselves to allow for new understandings, new perspectives, and new interpretations to emerge.

Three people were visiting and viewing the Grand Canyon—an artist, a pastor and a cowboy. As they stood on the edge of that massive abyss, each one responded with a cry of exclamation. The artist said, “Ah, what a beautiful scene to paint!” The minister cried, “What a wonderful example of the handiwork of God!” The cowboy mused, “What a terrible place to lose a cow!”

Idea for Impact: Work to overcome the strong waves of conditioning that you’ve been exposed to your whole life.

Take a step back and consider how you’re responding to a situation emotionally and intellectually.

Free up your mind from the conditioning that may be restraining it.

Don’t let your narrow perspectives—those comfortable walls within which you confine yourself—to make you lose touch with what’s possible.

Explore. Discover. Discern. Open your mind to new frontiers.

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Filed Under: Mental Models, Sharpening Your Skills Tagged With: Creativity, Critical Thinking, Parables, Problem Solving, Resilience, Success, Thinking Tools, Thought Process

Overcoming Personal Constraints is a Key to Success

August 14, 2020 By Nagesh Belludi Leave a Comment

Why do some people reach ever-higher levels of achievement, while others struggle or just plug along?

Norman Vincent Peale, the doyen of the think-positive mindset, provides a particularly illustrative example in You Can If You Think You Can (1987):

In Tokyo, I once met an American, an inspiring man, from Pennsylvania. Crippled from some form of paralysis, he was on a round-the-world journey in a wheelchair, getting a huge kick out of all his experiences. I commented that nothing seemed to get him down. His reply was a classic: “It’s only my legs that are paralyzed. The paralysis never got into my mind.”

No matter how formidable your talents, you’ll be held back by certain attitudes and behaviors that limit your achievements.

Your personal constraints—some of them beyond your control—will determine your level of success. Identify those constraints and make a plan to triumph over them.

Idea for Impact: The more you can reframe your attitudes toward the past, future, and present, the more likely you’ll find a meaningful life. Don’t let your constraints lay down what you can achieve.

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Filed Under: Mental Models, Sharpening Your Skills Tagged With: Attitudes, Creativity, Critical Thinking, Innovation, Mental Models, Parables, Problem Solving, Thinking Tools, Thought Process

Leo Burnett on Meaning and Purpose

June 15, 2020 By Nagesh Belludi Leave a Comment

Adman Leo Burnett (1892–1971) founded a global advertising agency that ranks among the titans of the trade. Burnett and the company that bears his name produced such famous brand icons as the Marlboro Man, Tony the Tiger, Jolly Green Giant, Maytag Repairman, and Pillsbury Doughboy.

Burnett pioneered the ‘Chicago School’ of advertising, wherein product campaigns centered on the inherent appeal of products themselves. Burnett’s advertisements used meaningful visuals to evoke emotions and experiences. This approach contrasted the time-honored use of catchy catchphrases and clever copy describing the products’ features. The models in Burnett’s campaigns resembled ordinary people rather than celebrities.

“When to Take My Name Off the Door”

After 33 years at the helm of his company, Burnett officially retired at age 76. He delivered a remarkable valedictory (film clip,) reminding his colleagues of his advertising agency’s core values and its high creative standards.

Let me tell you when I might demand that you take my name off the door.

When you lose your itch to do the job well for its own sake—regardless of the client, or the money, or the effort it takes.

When you lose your passion for thoroughness…your hatred of loose ends.

When you stop reaching for the manner, the overtones, the marriage of words and pictures that produces the fresh, the memorable, and the believable effect.

When you stop rededicating yourselves every day to the idea that better advertising is what the Leo Burnett Company is all about.

When you begin to compromise your integrity—which has always been the heart’s blood—the very guts of this agency.

When you stoop to convenient expediency and rationalize yourselves into acts of opportunism—for the sake of a fast buck.

When your main interest becomes a matter of size just to be big—rather than good, hard, wonderful work.

When you lose your humility and become big-shot weisenheimers … a little too big for your boots.

When you start giving lip service to this being a “creative agency” and stop really being one.

Finally, when you lose your respect for the lonely man—the man at his typewriter or his drawing board or behind his camera or just scribbling notes with one of our big black pencils—or working all night on a media plan. When you forget that the lonely man—and thank God for him—has made the agency we now have—possible. When you forget he’s the man who, because he is reaching harder, sometimes actually gets hold of—for a moment—one of those hot, unreachable stars.

THAT, boys and girls, is when I shall insist you take my name off the door.

Idea for Impact: Leaders are Meaning-Makers

Burnett’s valedictory is a potent reminder of the power of meaningful organizational values and a leader’s role in upholding his company’s principles-based DNA.

Organizational values are at the heart of the long-term success of a company. When these values grow fainter, the company may no longer reflect the intended culture. The organizational values will no longer clarify, inspire, and bind the company’s customers, employees, partners, investors, and other stakeholders.

As the steward of a company’s culture, a leader is responsible for institutionalizing—not merely individualizing—a sense and meaning in the workplace. And, as Burnett demonstrates, an effective leader passionately expresses what the company stands for and shares personal lessons learned in that process.

Burnett’s name is still on the door.

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Filed Under: Career Development, Sharpening Your Skills, The Great Innovators Tagged With: Attitudes, Creativity, Entrepreneurs, Likeability, Marketing, Winning on the Job

Howard Gardner’s Five Minds for the Future // Books in Brief

May 8, 2020 By Nagesh Belludi Leave a Comment

In Five Minds for the Future (2006,) developmental psychologist Howard Gardner argues that succeeding in a rapidly evolving world requires five proficiencies:

  • The Disciplinary Mind: “Individuals without one or more disciplines will not be able to succeed at any demanding workplace and will be restricted to menial tasks.”
  • The Synthesizing Mind: “Individuals without synthesizing capabilities will be overwhelmed by information and unable to make judicious decisions about personal or professional matters.”
  • The Creating Mind: “Individuals without creating capacities will be replaced by computers and will drive away those who have the creative spark.”
  • The Respectful Mind: “Individuals without respect will not be worthy of respect by others and will poison the workplace and the commons.”
  • The Ethical Mind: “Individuals without ethics will yield a world devoid of decent workers and responsible citizens: none of us will want to live on that desolate planet.”

Gardner is best known for his work on multiple intelligences—the theory that cast serious doubts about the simplistic concept of a “single” intelligence, measurable by something like IQ. Gardner’s notion that “there is more than one way to learn” has transformed education in the U.S. and around the world.

Recommendation: Speed-read Five Minds for the Future. Written through the lens of a skills-development policymaker, Gardner’s theses and prescriptions aren’t ground-breaking but make for thoughtful reflection. Complement with Gardner’s The Unschooled Mind (1991; summary.)

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Filed Under: Career Development, Mental Models, Sharpening Your Skills Tagged With: Creativity, Critical Thinking, Decision-Making, Mental Models, Skills for Success, Thinking Tools, Thought Process, Winning on the Job

Make ‘Em Thirsty

May 6, 2020 By Nagesh Belludi Leave a Comment

Sony’s Akio Morita, like Apple’s Steve Jobs, was a marketing genius. Morita’s hit parade included such iconic products as the first hand-held transistor radio and the Walkman portable audio cassette player.

Key to Morita’s success was his mastery of the art of the pitch. Morita pushed Sony to create consumer electronics for which no obvious need existed and then generated demand for them.

The best marketing minds know how to create a customer—previously unaware of a problem or an opportunity, she becomes interested in considering the opportunity, and finally acts upon it.

Coca-Cola marketers are but creating a thirst by showing the fizzle a freshly poured glass in Coke ads. “Thirst asks nothing more,” indeed.

The marketing guru Seth Godin has said, “So many people are unhappy … what they have doesn’t make them unhappy. What they want does. And want is created by the marketers.” Recall the old parable,

A sales trainee was trying to explain his failure to close a single deal in his first week. “You know,” he said to his manager, “you can lead a horse to water, but you can’t make him drink.”

“Make him drink?” The manager sputtered. “Your job is to make him thirsty.”

Idea for Impact: Whether you realize this or not, you’re in marketing, as is everybody else. You’re constantly pitching your ideas, skills, time, appeal, charm, and so forth. Study the art of the pitch. Master the art of generating demand for whatever it is you have to offer. Learn to “make ’em thirsty.” Marketing is everything.

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Filed Under: Mental Models, Sharpening Your Skills Tagged With: Creativity, Customer Service, Innovation, Marketing, Parables, Persuasion, Problem Solving, Skills for Success, Thinking Tools, Winning on the Job

How to Have a Eureka Moment during the Coronavirus Lockdown

April 23, 2020 By Nagesh Belludi Leave a Comment

The best solutions to problems sometimes come about suddenly and unexpectedly when people aren’t actively working on their issues.

Psychologists call this phenomenon “incubation”—a brief shift away from a problem that could trigger a flash of insight as if from no additional effort. [Incidentally, “incubation” is very much a term in vogue during the current epidemic.]

Abundant anecdotes evoke creative breakthroughs made when inventors took breaks from working on their problems after many failed attempts to solve them.

‘Eureka Moments’ happen all the time

Perhaps the best-known case in point of incubation is that of the ancient Greek polymath Archimedes.

It’s plausible that Archimedes realized that he could investigate the suspected adulteration of Hieron II’s votive crown (“corona” in Italian/Latin, incidentally) by weighing it in water. The legend doesn’t appear in any of Archimedes’s known works.

That Archimedes leaped out from the bath in which he purportedly got the idea and ran home unclothed is likely a popular embellishment. The Roman architect Vitruvius first mentioned this spin to the story some 200 years after the supposed event:

[Archimedes] happened to go to the bath, and on getting into a tub observed that the more his body sank into it, the more water ran out over the tub. As this pointed out the way to explain the case in question, he jumped out of the tub and rushed home naked, crying with a loud voice that he had found what he was seeking; for he as he ran he shouted repeatedly in Greek, “Heúrēka, heúrēka.” meaning “I have found (it,) I have found (it.)

Millennia later, the scientific world is replete with the exclamation. In fact, the prospectors of California’s gold rush were so keen on the expression that it has appeared on the state seal since 1849, becoming the state’s motto in 1963.

Idea for Impact: To overcome a mental block, take your mind off the problem

After a period of conscious work, if you’ve reached an impasse that is blocking (“fixation”) your awareness of the solution to a problem, set it aside.

Remove yourself from the task. Take your mind off the problem. Go for a run, play with your dog, play an instrument, indulge in your favorite video game, take a shower, or embark on some optimally distracting hobby.

Creativity involves putting old ideas together in new ways. Your mind may be shuffling information at all times, even when you’re not conscious of it. You may just hit upon a solution during either your time away or when you return to the problem after the incubation period.

Wondering what to read next?

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  3. Van Gogh Didn’t Just Copy—He Reinvented
  4. Turning a Minus Into a Plus … Constraints are Catalysts for Innovation
  5. What the Duck!

Filed Under: Sharpening Your Skills Tagged With: Creativity, Critical Thinking, Parables, Thought Process

The Myth of the First-Mover Advantage

February 20, 2020 By Nagesh Belludi Leave a Comment

If you’re an entrepreneur entering a new market with a product or service that nobody else offers, you’ll seek the first-mover advantage.

  • You’ll move quickly to get established as a market leader. If your business idea has the potential to succeed, other entrepreneurs are possibly working on it at the same time or will be quick to emulate when they see what you’re doing.
  • You’ll validate your concepts quickly by identifying and partnering with a few enthusiastic “guinea pig” customers who can test your product or service early on and give you feedback regarding what customers really want.
  • You’ll create some barriers (“establish an economic moat” in Warren Buffett-speak) to inhibit other aspirants from entering the market—you’ll secure patents on your intellectual property, lock-in key locations, or negotiate longer-term contracts with customers.

Alas, many first-mover advantages are not sustainable, and many first-movers are as successful as what the superstars will have you believe.

First-to-Market is often First-to-Fail

New ventures have higher failure rates than more established businesses.

Creating market awareness, sustaining market acceptance, fending away aggressive competitors are often easier said than done for many new ventures, not to mention lining up suppliers and distributors. Besides, unless you’re well-capitalized by patient investors, you’re likely to face higher-than-foreseen marketing costs on top of lower-than-anticipated sales.

Instead, if you are the second—or later—entrepreneur to market, you’ll stand a better chance of success by learning from the forerunner’s mistakes. You’ll also earn better credence from your customers, suppliers, distributors, employees, and investors to help create a better product or service.

Idea for Impact: There’s an American adage that “many pioneers died with arrows in their backs.” The best time for an entrepreneur to offer a new product or service is after others have already gotten there and laid some groundwork.

Wondering what to read next?

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Filed Under: Mental Models, Sharpening Your Skills, The Great Innovators Tagged With: Creativity, Critical Thinking, Customer Service, Entrepreneurs, Innovation, Luck, Thought Process

Better Than Brainstorming

February 8, 2020 By Nagesh Belludi Leave a Comment

Most brainstorming sessions suck. Facilitators aren’t often skilled enough to direct the creative process and overcome interpersonal and intrapersonal barriers to idea-generation. Participants are not as organized as they need to be. One or two “meeting-hogs,” who lack self-awareness and self-control, dominate the conversations with their pet ideas and shut everyone else down. And then there’s groupthink and self-censorship based on responses to earlier suggestions by others. Consequently, bold ideas seldom survive a group discussion.

If you want to buck the odds, try “brainwriting” instead of brainstorming.

In its simplest form, brainwriting has the participants quietly reflect upon an open-ended prompt of appropriate scope, for example, “how could we improve our design process,” and write down their ideas. A group leader can organize the responses by combining identical ideas, grouping thematically-related ideas, and posting them on a wall for the group to appraise them further. Then, the participants vote on their favorites, and the top ‘n’ number of ideas or priorities are identified for future discussion and exploration.

Idea for Impact: Teams Don’t Think—Individuals Do

In essence, brainwriting isolates idea generation from the instantaneous discussion and evaluation that can hamper the creative process.

Brainwriting, when followed by discussion, combines the benefits of both individual and group creativity. Studies have repeatedly shown that people think of more new—and practical—ideas on their own than they do in a group.

In my experience, this creative thinking process is inclusionary, engaging, time-effective, non-judgmental, and mostly free from pressures to conform to others’ ideas. Brainwriting is particularly useful with a group of people who are reserved and would be unlikely to offer many ideas in an open group session.

Wondering what to read next?

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  2. How to Stimulate Group Creativity // Book Summary of Edward de Bono’s ‘Six Thinking Hats’
  3. Why Group Brainstorming Falls Short on Creativity and How to Improve It
  4. The Solution to a Problem Often Depends on How You State It
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Filed Under: Mental Models, Sharpening Your Skills Tagged With: Creativity, Critical Thinking, Decision-Making, Social Dynamics, Teams, Thinking Tools

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About: Nagesh Belludi [hire] is a St. Petersburg, Florida-based freethinker, investor, and leadership coach. He specializes in helping executives and companies ensure that the overall quality of their decision-making benefits isn’t compromised by a lack of a big-picture understanding.

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