You probably saw the story on CBS Sunday Morning (click here).
11,000 Club Members.
11,000 on the Waiting List.
The secret over the past two years seems to be an exclusive subscriber list that you treat better than your average customer / prospect.
Makes me think about my own business ... hmmmmmmm ... what ideas do you have for your business (or mine)??!!
If you are a restaurant in Los Angeles, you don't get a COVID-Bump. You get to be closed, with no assistance from anybody. Good luck!!
But if you are a direct-to-consumer e-commerce brand not selling apparel, you might still be benefiting from a massive COVID-Bump, fueled mostly by new customers. You are stunned by what has happened in 2020. What will likely be 400,000 deaths and millions of hospitalizations netted you +50% or +100% sales gains. As I was told earlier this fall ... "I'm torn between feeling awful for society and feeling blessed because my company is performing well and I have a job."
What is the question I'm asked to analyze most often this Fall?
If your Annual Repurchase Rate is greater than 50%, well, it's a whole different world. You get to enjoy the magic of Compound Interest for several years. God smiled upon your business model.
For any business, however, 2021 is a "setup year". It's like in baseball when you have a 4-2 lead in the 8th inning. You bring in your setup relief pitcher. It is his job to bridge the gap between the 7th inning and the 9th inning, when you bring your closer in to finish off the game. If you want 2022 to be as successful as possible, you need to set up 2021 to be as successful as possible.
Certainly you've heard the news by now ... maybe not from the trade industry, but if you are on Twitter the outpouring of support was unavoidable for the founder of Zappos (click here).
Mr. Hsieh was an early reader of this blog. When you are getting started in this business, it's helpful to have a somebody read what a nobody has to say.
Mr. Hsieh was one of four people (Don Libey, Ben Chestnut of MailChimp, Robert Kestnbaum are the other three) who thought differently in a way that shaped how I viewed things. Three of the four are gone now. Make sure you appreciate those you think highly of. Say something to them while they are still here.
Do you have examples of individuals in our industry that have shaped how you view the world? Share those individuals with our audience ... pass me a note and I'll publish credible responses.
P.S.: If you are a cataloger, read up on the stuff that Robert/Kate Kestnbaum wrote about in the 1990s. They used math 25-30 years ago that was smarter than the math you are using today. Hint - their math forms the basis of the catalog optimization work I perform today.
P.P.S.: If you love email marketing, read what Ben Chestnut has to say. Also notice that he didn't choose to dominate email marketing ... he helped small businesses be excellent at email marketing, and that difficult choice made all the difference.
P.P.P.S: Don Libey taught me how to run a consulting business as an independent consultant. He gave away his knowledge, for free. He's largely the reason that the work I perform is mostly shared ... for free ... via this blog.
Most of my project work shows two important facts (yes, there are exceptions):
It's a lot easier in Sports to see how strategy evolves over time than it is to see how strategy evolves in Business. Sports is measured in terms of wins, losses, and Championships. As a consequence, good strategies tend to be moved into the future, where they are evolved. In business, some of the best strategies I've seen are buried in small businesses that never evolve or change, and as a consequence those strategies never see the light of day.
This brings me to the story of Virgil Carter. Virgil was a Statistics Major at BYU, and he was a good college Quarterback. In the NFL, Mr. Carter had a weak arm, so the Cincinnati Bengals had to develop an offense that would suit what he did well (he released the ball quickly and was an accurate thrower). Who was his offensive coordinator? Well, it was none other than Bill Walsh, who won multiple Super Bowls with the San Francisco 49ers in the 1980s. Bill Walsh developed what became known as the "West Coast Offense" to suit Mr. Carter's skills, then evolved the offense to a comprehensive "system" for running a football organization. Heck, Mr. Walsh wrote a book with a limited number of copies on how to run a football organization. I bought one of the copies on eBay for $$$ ... if you carefully look at the bookshelf of any NFL coach, you might just see one of the copies.
Remember when I told you that Mr. Carter was a statistician? Well, it turns out that Mr. Carter also contributed to the future of football by analyzing the outcome of plays (click here). He learned how many expected points you would generate if you took over possession of the ball at your own 33 yard line, for instance.
So Virgil Carter played two key roles in the evolution of football.
Last week was fun ... I wrote about risk ... and close to 1% of subscribers opted-out, citing that "CONTENT IS NO LONGER RELEVANT".
I've always judged that when many people unsubscribe because CONTENT IS NO LONGER RELEVANT that I am headed down the right path. I lost a ton of subscribers back in 2013 when I started talking about the importance of merchandise performance ... then I generated more annual revenue over the next three years than during any other three year period ... because you (the loyal reader) hired me to analyze merchandise performance.
I've learned a lot about the audience over the past fourteen years. A key finding is that the audience tends to want very specific answers to very specific questions. If I write about general topics that relate to general questions, the audience rebels.
In recent years, a fraction of the audience has become more combative. These individuals want very specific answers to very specific questions ... and more important, they want to ARGUE about specific answers. The arguing is the end result that "some" readers seem to embrace ... sort of like in politics. The reader can "appear" smart by arguing a small fact in a large argument, without ever having to apply any smarts to a challenging business situation.
I had one subscriber who was with me for several years. This person held a C-Level position with a company that was headed toward bankruptcy. This person always argued ... he wasn't mean (he was very kind to be honest, I assume a very good person), but he was always nitpicking 5% of an argument in an effort to invalidate 100% of an argument. He was quite good at this. I can't imagine how frustrating it would have been to work for this individual. Worse, he had answers to every specific argument you could imagine ("here are four reasons why Amazon will not take over e-commerce") but didn't have a single argument for solving the problem at hand ... that being, of course, the fact that his own company was headed into bankruptcy.
His company went bankrupt.
You didn't opt out last week ... I know that because you are still reading today's post. That means you are at least somewhat open-minded to different concepts. Frequently I develop ideas as a stream-of-thought over several days/weeks, and those ideas infrequently become products that eventually help your business. That's how I use this blog. I use it to develop concepts. I'm not trying to provide a specific answer to a specific question. I'm trying to hover a level or two above specific answers to specific questions. If I do that successfully, your business performance can improve.
P.S.: Speaking of highly specific answers, here is an example of what I am talking about, one that everybody can form an opinion of (click here). This is what so many readers want ... a highly specific solution that everybody can "weigh in on".
I promised you I'd share how variable profit is under normal circumstances.
25% of the time profit will be below $2.3 million.
50% of the time profit will be around $2.8 million.
25% of the time profit will be above $3.2 million.
10% of the time profit will be above $3.6 million.
Our CFO ... she's not going to be pleased with profit numbers that could vary between $2.0 million and $3.6 million.
But this is what we're dealing with when we craft a plan. We do all of this work, hard work, to produce a certain outcome. But the outcome is not certain. The outcome is highly variable. I mean, half the time profit could be between $2.3 million and $3.2 million. And the other half of the time? It's an outcome more variable than that.
And that's under normal circumstances.
Every one of you is dealing with a business that has that kind of variability. Your estimates for what "will" happen next year are filled with risk, filled with variability.
Then you layer COVID on top of it.
It's going to be darn important to communicate risk to people. Unbelievers. Folks who think because a spreadsheet says you will generate $62,000,000 means you are promising to deliver $62,000,000. In a normal year you could not make that promise, though you've done so for a long time. In 2021? You are facing more risk than you've faced since 2020.
A flexible and adjustable plan, one where you clearly communicate a range of possible outcomes ... that's what is needed in 2021.
You probably saw the story on CBS Sunday Morning ( click here ). 11,000 Club Members. 11,000 on the Waiting List. The secret over the past t...
