Implementing Organic Growth Strategies at the Kellogg School

After running a very successful initial session in February, the Kellogg School decided to expand the program, scheduling one in January and December 2009. Although the web site has not been updated yet,
http://execed.kellogg.northwestern.edu/programs/LEAD20/index.htm

the following excerpt highlights the program:

Your business had a great growth strategy but it never got to market. Why? Implementing Organic Growth Strategies deals explicitly with the challenges and issues confronting any business trying to implement new business designs. Participants will be exposed to powerful, market tested implementation tools and methodologies that can be deployed immediately. The tools and methodologies presented in this program are based on a variety of world class growth practices and academic research that were tested and optimized over a 10 year period in real business situations. Therefore we know what the pitfalls are and we will show you how to overcome them.

The participants for this program should be any employee who is managing growth initiatives. We also strongly encourage teams attend to enhance the experience.

You can apply for the class at:
http://www.kellogg.northwestern.edu/execed/programs/LEAD20/impgrowth_sessions.htm

This site also defines the relationship between this class and our original Driving Organic Top Line Growth Strategies.

Organic Growth Program Series

The Kellogg School's two organic growth offerings - Driving Organic Top-Line Growth and Implementing Organic Growth Strategies - are built off the same methodologies and designed to be synergistic with but independent of each other. It does not matter in which order they are taken to gain the full benefit. When taken within 12 months of each other you are entitled to a 20% discount on the second program you attend. Our special registration code must be provided at the time of registration for the second program.

The next Driving Organic Growth Strategies will be given on December 1 to 4, 2008 at the Miami campus: http://www.kellogg.northwestern.edu/execed/programs/LEAD17/index.htm

The Physics of Marketing - Newton’s Law of Gravitation
Davidbowman.com
April 25, 2008

Nothing here is revolutionary, but I think the thought process is very interesting

Perhaps one of the most widely known principles of science is gravity. I say this knowing that while most people could probably not explain gravity very well, just about everyone understands the idea. This was Newton’s blockbuster idea. It explained ocean tides, comets, and even led to the discovery of Neptune.

So what is Newton’s Law of Gravitation about? Well, here goes…

Newton basically asserted that “every object in the universe attracts every other object along a line of the centres of the objects, proportional to each object’s mass and inversely proportional to the square of the distances between the objects.” This theory served to explain much of the earlier work of Kepler in one concise theory. While Newton’s Law of Gravitation was later proven not to apply to all objects (black holes and situations with extremely high gravity) by Einstein, his work is a foundational part of modern scientific thought.

So in my feeble mind it seems that Mass and Distance are the keys here. Now how to take these ideas and put them in the context of Marketing?
Because people are not always rational, I am not sure you can apply an equation to human behavior with much precision, but I definitely think that there are parallels to be drawn. Here is my first take. Think about customers. Big brands get big attention. People know Coke. People buy Coke. Coke is massive. Coke has pull.

So how do little brands stand a chance of getting some “pull” with customers. The answer lies in proximity - the other part of Newton’s Theory. Small companies must get close to the customer in order to stand any chance of survival. They can actually use this to thrive and exert considerable influence if properly executed. Would a proper analogy be the impact of the relatively tiny moon on the Earth’s tides as opposed to the sun’s impact on them? (I ask because I am not a scientist) The moon has huge pull on the Earth’s oceans, and impacts the tides because of proximity. Certainly it has far less Mass than the giant sun. Still it is close. So, continuing my example in the world of soda pop, (using both terms to be user friendly) Jones Soda has done a great job of being “the moon.” They decided to get close to consumers - actually putting photographs of them on their packaging. This has allowed them to build a loyal following of consumers who are engaged with their products. They conduct events that are designed to be built around the consumer as well. They have done a masterful job of utilizing this principle to create growth.

Here is the rub for most companies. How to maintain that proximity. Starbucks is feeling this pain, Jones is probably going through it as well. As you gain more mass, it is actually more difficult to remain close to the consumer. The proximity or closeness to individual consumers tends to suffer as companies experience growth. The distance increases, and they exert less pull. In summary the moon becomes more like the sun, just not nearly as big. Thus the advantage it enjoyed thanks to proximity is destroyed. Jones becomes more like Coke, but without the Mass to sustain the gravity.

Wonder why your favorite brand “sold out?” Well because they were faced with this dilemma. How to stay close and simultaneously get big. How to maintain or increase pull? “Selling out” is just a natural part of that. People inevitable pick Coke, because it carries a lot of weight. It has mass - and thus gravity. It pulls people back. To sustain that mass Coke invests in Mass media, mass distribution, mass exposure. It must sell a lot of soda pop to sustain that mass and gravity. This is why small companies don’t need Super Bowl ads to thrive. They need super customer service.

Marketing in my mind is all about the customer. You can have gravity through mass or proximity. You might be able to get both, but often you have to choose. There is no “right choice” but recognize that with that choice comes the implications of gravity. Growth for growth sake - more mass - might not always be the answer.

Are Google, Yahoo the next dinosaurs?
By Leslie Cauley, USA TODAY Tue Jun 10, 7:32 AM ET
Charles Darwin famously declared that "natural selection" was Mother Nature's way of improving a species so it could advance.


THE TITLE OF THE ARTICLE REALLY CAUGHT MY INTEREST. IS IT POSSIBLE FOR GOOGLE TO BECOME A DINOSAUR? WITH THE CHANGE IN THE MARKET HIGHLIGHTED IN THIS ARTICLE AND ITS IMPLICATIONS TO CURRENT BUSINESS MODELS AND TECHNOLOGY, ANYTHING IS POSSIBLE. THIS IS THE ENORMOUS CHALLENGE THAT EVERY SUCCESSFUL COMPANY MUST BE AWARE OF AND SENSITIVE TO. THIS IS A CRITICAL ROLE OF LEADERSHIP.

Internet search engines are locked in their own Darwinian drama. Depending how it turns out, desktop brands such as Google (GOOG) and Yahoo (YHOO) could become sturdier versions of themselves, ensuring survival as more people bolt for the mobile Web. Or they could become the Dodo birds of the Net - outclassed by a new generation of rivals.

Born in the early days of the Internet, Google, Yahoo and smaller competitors help billions of people navigate the Web each day. Now, they're scrambling to adapt their desktop services for the hard realities of the wireless world.

Today, about 1 billion people have PCs; about 3 billion have mobile phones, growing to 4 billion by 2010. A major driver is the growing popularity of Web-enabled devices such as the Apple (AAPL) iPhone.

(The real challenge of the current business model) One of the biggest challenges: dealing with the matchbox-size screens of cell phones and other devices, which aren't hospitable to the ads that are the lifeblood of traditional search engines. Billions in potential ad revenue are at stake as social networks, location-based services and wireless search deliver instant answers to wireless users on the go.

"As hot as they are right now, Google and the others could become dinosaurs if they simply try to use their old business models,"

(the classic dynamic for so many former industry leaders as their markets change) says Roger Entner, a senior vice president at IAG Research in Boston. But if they can adapt, he says, they could extend their dominance.

Microsoft (MSFT) has been pushing its Windows Mobile operating system for years. Today, it's available from 50 handset makers and more than 160 mobile operators worldwide.

Even so, it's been tough slogging, says Phil Holden, director of online services for Microsoft.
"What we've learned is that loyalty on the PC doesn't necessarily transfer to the mobile phone," he says. The wireless world, he adds, "has a lot of different dynamics."

One thing everybody agrees on: The mobile Web is an advertising gold mine just waiting to happen.

The fledgling mobile search industry generated about $700 million in ad revenue in 2007, JupiterResearch estimates. By 2012, revenue is expected to hit $2.2 billion and keep rising. Jupiter analyst Julie Ask says mobile search could eventually eclipse the traditional Web, which currently generates about $20 billion in ad revenue.

No matter how things shake out, consumers will benefit, predicts Ford Cavallari of Monitor Group, a consulting firm in Boston that specializes in technology. Search rankings based on factors that have little relation to the quality of a product or service, such as the number of daily "hits" a website gets, or a paid advertisement placement, are about to become history, he says.

Soon, word-of-mouth referrals from social-networking sites (think Facebook and MySpace(NWS)) and customized data made possible by instant messaging and other instant communications will rule, he says.

The upshot: In the near future, a restaurant "might actually have to be high quality and offer value" to patrons to draw customers from the Web, Cavallari says.

"In the next 12 to 18 months we're going to see a growing segment of (consumers) using wireless services as the way to get on the Internet 95% of the time," says Imad Mouline, chief technology officer of Gomez, which helps Facebook, Expedia (EXPE) and other companies improve the quality of their Web presence. Currently, about 16% of cellphone owners use handheld devices to access the mobile Web, Jupiter says.

Entner, for one, thinks the mobile Web could produce a mighty rival to traditional desktop engines, one whose core strengths are rooted in the unique world of wireless. Such a newcomer, he says, "could wind up doing to Google what Google did to Yahoo" and other PC-based search engines. Namely, it could trump them in the marketplace.
To be sure, Google, a Web monster with a market value of more than $200 billion, would be tough to topple. But it's not impossible.

If it's not careful, Entner says, Google could wind up following in AOL's famous footsteps. AOL in the '90s was an online juggernaut with a gold-plated brand name and more than 30 million subscribers. Today, it's a free service with a dwindling base of about 8.7 million customers.

"Google is trying to replicate a 20-inch experience on a 2-inch screen, and that's leaving them, inevitably, about 90% short," he says.

Too much information

Making the leap to wireless is a lot trickier than it might appear.
For starters, there are those tiny screens. Internet search was designed for PC screens, which can easily accommodate loads of advertisements. The latter is critical, because search engines depend on ads for their financial survival.

In the PC environment, ads are abundant and constant. Paid advertisements are typically stripped along the right side of the PC screen, with premium spots at the top reserved for the biggest spenders.

Try that on a wireless device, and you'd quickly run out of room for anything else.

Similarly, the basic act of rendering searches also gets tough on a tiny screen.

In the online world, a single search request can result in a dozen or more pages of results. If results aren't specific enough, you simply resubmit a query. After a few tries, you usually find what you're looking for.

That entire process is a total non-starter in the wireless environment, says Sameer Mithal, a senior principal with IBB Consulting in Princeton, N.J.
Mobile consumers are typically on the run, he says, with little time or patience for typing on pint-size keypads. As for pages of search results - forget about it. There isn't nearly enough screen space for that, Mithal says.

And advertisements? Approach with care; otherwise, you may offend customers and lose them for good, Gomez's Mouline warns. "Not doing it thoughtfully can get you to a point where customers will abandon your entire brand."

Traditional search engines, to some extent, are victims of their own success. Basic search algorithms are designed to do a massive Web "crawl" each time a search request is received. In the mobile environment, however, such thoroughness can be the digital equivalent of using a shotgun to take out a housefly - way too much firepower for the task at hand.

"The desktop search engines are what they are," Mithal shrugs. Even if you're only asking for a very specific thing - a sports score, for example - "they still have to search overall Web content."
Search engines, angling to win over mobile customers early, are racing to solve these problems. Their solutions, in some cases, are wildly different.

Yahoo's solution is a nod to the social-networking craze. Its OneConnect service, which makes its debut this summer, integrates messaging and social-networking updates from Facebook, MySpace and the like in one spot on the phone. OneConnect ties directly to a user's address book, letting people share information, social-networking updates and messages on the fly.

"On the phone, time is limited, so you really need to provide highly relevant and useful information," says Marc Davis, chief scientist for Connected Life, the Yahoo unit responsible for non-PC services, including mobile.

That philosophy is the force behind "OneSearch with Voice," which integrates voice-recognition technology with traditional search. The service allows users to simply speak their request into a cellphone - "Where's the best craps table in Las Vegas?" - in plain English. Responses are sent back in text form, as in any other search.

The voice-recognition technology is "so good, it's shocking," Davis says, handling accents, continuous speech and verbal affectations with ease.

While all searches, mobile and otherwise, use the same search algorithm, there is one big difference: Yahoo says mobile search responses are provided strictly on the basis of relevancy, with no preferential treatment for ad-supported products and services. "This is about providing answers, not links," Davis says.

Google says it sees no reason to change what it does just because it's moving into the wireless arena. "We think that what we do is highly transferable to the mobile device," says Matt Waddell, chief of mobile and developer products for Google. (!!!!!!!!!!!!)
The tiny screen isn't a problem, he says. "It's still as easy as typing."

That said, Google is making a few accommodations. Instead of giving wireless users pages of search results, for example, it only offers "snippets" - Google-speak for the first few search results that appear at the top of the page. It's also limiting the number of ads to one or two per search.

Waddell says the advertising opportunities in wireless are huge. One example: Say you're in San Francisco, and you suddenly get an urge for pasta. Provided your device has Global Positioning System location technology, Waddell says, Google can offer up a list of Italian restaurants within a five-minute walk.

"Advertisers would probably be willing to pay more money for such an ad, because it would be much more targeted," he says.

While such an approach might seem to subjugate the interests of consumers to advertisers, Waddell says that's not the case at all. "We never think of advertising first," he says, adding, "We won't touch an ad with a 10-foot pole unless we think it delivers a better search experience."

Google is taking other steps to make sure it doesn't get iced out of wireless opportunities. The Web giant is pushing development of an open wireless operating system - dubbed Android - that would make it easier for consumers to use Google's mobile services. Android-loaded devices are expected to hit the market later this year.

While the big incumbents duke it out, start-ups are nipping at their heels. That includes Medio, a Seattle-based company that hopes to turn itself into the Google of mobile.
Like Google, Medio's service is geared around a simple "search box" format. That's where the similarity ends, CEO Brian Lent says. Medio "was designed as a pure-play company for the mobile industry."

Unlike Google, he says, Medio's patented algorithm hones in on "mobile discovery," producing far more relevant answers for users. Example: A search for a Madonna ring tone might also result in links to a CNN article about the singer, as well as V Cast, the mobile music channel offered by Verizon.

"That's a lot different than crawling the Web" as Google does every time a query is received, Lent says.

Another difference: Medio is a "white label" company that works directly with big carriers such as Verizon and T-Mobile. Carriers, in turn, rebrand Medio's service under their own names.
Lent has a very personal view of the Web's biggest search engine. A data-mining expert, Lent was part of the academic team that worked on Google when it was still a lab project at Stanford. He left to take a job at Amazon a month before Google was incorporated.

Lent, who remains friends with Google co-founder Sergey Brin, says he's hugely admiring of Google's pioneering efforts. The Web giant, now a Medio partner, almost single-handedly raised the online search category to a new level, he says, introducing billions of people to the wonders of the Web.

But now it's a new world, he says - a wireless world. "Everyone wants to bash the incumbent, but I'd rather take a playbook out of judo and leverage the strengths that they have" and build on top of that, Lent says.

The Physics of Passion

http://headrush.typepad.com/creating_passionate_users/2005/08/physics_of_pass.html

I thought this was pretty cool....

You don't really have passionate users until someone starts accusing them of "drinking the koolaid." You might have happy users, even loyal users, but it's the truly passionate that upset others enough to motivate them to say something. Where there is passion, there is always anti-passion... or rather passion in the hate dimension.

If you create passionate users, you have to expect passionate detractors. You should welcome their appearance in blogs, forums, and user groups. It means you've arrived. Forget the tipping point--if you want to measure passion, look for the koolaid point…..

Remember folks, we aren't going for user satisfaction. We aren't going for happy. We're going for all-out passion. And that comes with a price tag. Detractors. Lots of them. And they talk. For every passionate user out evangelizing you to everyone they meet, a koolaid-hunter will do his (or her) best to make sure everyone knows that your passionate users have lost their minds. That they're victim of marketing hype. Sheep.

Remember we discussed the Attribute Map in an earlier bog (McGrath and MacMillan). "Drinking the Kool-Aid" and passion are the Energizers in this framework. The key point to remember is that even the most powerful energizer attribute eventually becomes a non-negotiable or table stakes. Creating passion is an ongoing process! Remember we discussed the Attribute Map in an earlier bog (McGrath and MacMillan). "Drinking the Kool-Aid" and passion are the Energizers in this framework. The key point to remember is that even the most powerful energizer attribute eventually becomes a non-negotiable or table stakes. Creating passion is an ongoing process!