marketing

USP & How To Find Your Niche (Specialize)

Unique Selling Proposition (USP) first appeared as a theory in 1940’s. It was furthered by practitioner, Rosser Reeves, and professor, Theordore Levitt. In 1986’s The Marketing Imagination, Levitt wrote that search for “[t]he meaningful distinction is a central part of the marketing effort”. He proposed that everything else business does is a function of that distinction.

This blog will discuss how to measure the impact of your USP. I assume that a USP statement was created and, perhaps, started to execute on it. I will discuss the leading and lagging indicators that might help measure USP’s impact. After having measured USP, a company will be armed with the most powerful but fast-expiring component to success in business world – insight. I will show how you can use that insights to build a deeper presence in any marketplace by specializing using basic economic and strategic thinking.

Part I: Measuring USP

USP fills the gap between customer’s needs and firm’s offering (be it a product or service). It is a vital tool for any business to determine its place in the market. The USP identifies and attempts to fill the gap that is not served by the competition. To execute properly the USP, the managers need to unite all of the business’s processes together to help deliver on the promises enshrined in the proposition. Remember, what Gore Vidal (or Larry Ellison or Genghis Khan) said: “it is not enough to succeed, others must fail.” Armed with a powerful USP, a company needs to maintain its position. If you think of Southwest Airlines, Wal-Mart, and your local pizzeria, all of them are working toward executing on strategic factors that differentiates them from their substitutes. Southwest Airlines and Wal-Mart are “keeping cost down” while the local pizzeria emphasis convenience. Definition of a tool is “something that has practical function.” USP can only be useful if it offers practical and immediate action.

Remember the adage, “it is all course correction”. There is no USP that is right or always right. There is one that is appropriate for the customers’ current needs. If you have different strata of customers, for each there should be a USP. Using data to evaluate what is working and what isn’t is a very valuable management practice. We are going to collect quick and dirty qualitative and quantitative data.

There is a key difference between leading and lagging indicators. Lagging indicators are typically “output” oriented, easier to measure but harder to improve or influence. Leading indicators are typically input oriented, harder to measure and easier to influence. I look at the leading indicators as hints of the future events (tends to change ahead of the future event) while lagging are reports of the past activities.

Leading indicator

  1. Vision
  2. Customer Feedback[1]

Lagging Indicators

  1. Sales
  2. Competitor’s reaction

Leading Indicators

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Vision

What is the success of a start up? It is the clear vision for the company. The vision potency is measured how your team or partners accept the vision. Creating a want in the market and fulfill it is a long-term proposition achieved only after a momentum of demand for your product or service is achieved. Furthermore, it is likely that you only have secondary or indirect data on your market. The vision should be specific and well understood image of where managers are taking the company. Consistency is vital.

Feedback

customer-feedback-social-media-800x400There are three groups you should continually ask for feedback: your customers, your team, and your suppliers.

For your customers, find out up to 30 customers. Ask them specifically about your business. Ask them

  • Why do you do business with us?
  • Tell us about your favorite service experience you have in this industry?
  • What is the one thing none of your vendors do that you wish they would?
  • Is there a recent example where we have not met your expectations?[2]

This information will help you find a gap that you can fulfill but, remember, you can’t be all things to all people. Concentrate on the one thing at a time that is missing that will make easier or unnecessary.

For your team, employees and partners, ask them

  • What excites about the role when they started working? What is exciting them now?
  • What’s one thing the company does better than others?
  • What is one thing the company could do to create a better experience for the customers?

Often, your suppliers are overlooked partners for your company. Although not always eager or available, they have wealth of information and insights. Ask them

  • What would you Google to find a business like ours?[3]
  • Do you refer us to potential clients, and if so, why?
  • What other companies do you love to refer?

Lagging Indicators

Sales

Profit is the sign of sucAAEAAQAAAAAAAAOVAAAAJDBmMjJjZmJmLWVkMzctNDlkNS1iMmYyLTc2NTJiODY5M2ExNwcess in the private sector. Everything comes down to the revenue. Can you revenue sustain your vision and your expectations for the business? If market does not support your current version of USP, assumptions need to re-examined and experimentation should take place with different of channels delivery.

Competitor’s reaction

Your USP changes the dynamics of the competitive landscape. Or at least that is what you hope for. Before you entered the fray, there was equilibrium or certain way of doing that was settleconquestingd. You will have to analyze to see if your USP made a difference on your competitors’ marketing, product offerings, or pricing. Your USP is always under evolutionary process of change. It is always under threat from others. You will need to adjust it based on what your competitors do to stay relevant for your customer and their experience with your product.

You can take one more steps for a richer understanding of your market dynamics.

Part 2: How to Specialize Using USP

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The greatest asset that a company has is its customer profile. The essence of business is to have the most precise list of customers or leads. Why? Specialization. Specialization success comes from segmenting the roster of customers or leads who will purchase at higher rate (either price or volume) your offering. Specialization does not necessary arises from products or services. Think of Twitter. Its original target failed. Viagra was blood pressure pill. Specialization can only come from achieving comparative advantage in the market place by having the lowest opportunity cost. When it comes to specialization, the primary job of an entrepreneur, regardless of company’s stage of development, is to choose where to specialize the company, its processes, and its employees.

Taking the information from Part I, I would recommend using Reduce-Eliminate-Create-Raise framework developed by W. Chan Kim and Renée Mauborgne[4] to find specialization. To use this framework, seek only using specific actions for each quadrant. Two important elements will help you find competitive gap that you can fill.

First, Industry standard or best practices do not always apply to all markets. Sometimes competition sets its own standards that are not followed by the average of all the firms in a given industry. Furthermore, geographical and environmental factors (land, labor, capital, policy) determine their own micro-market dynamics. For example, Philadelphia, being 5th largest city in US, is not present in the Case-Shiller Housing Index.

Second, there are two types of comparative advantages[5] – absolute and relative. Whereas absolute advantage refers to the superior production capabilities of one company versus another, comparative advantage is based on the concept of opportunity cost or autarky price, i.e. at a lower relative marginal cost prior to delivering your product or service. The opportunity cost of a given option is equal to the forfeited benefits that could have been gained by choosing the alternative. Remember, as an entrepreneur, you are looking to lower relative opportunity cost. One does not compare the monetary costs of production or even the resource costs (labor needed per unit of output) of production. Instead, one must compare the opportunity costs of producing goods across best practices/standards by both competitors and alternative markets[6].

Now, putting it all together, when utilizing the Reduce-Eliminate-Create-Raise quadrants, you need to decide what specific actions will reduce your opportunity cost. I would include both competitors and complimentary or alternative companies. Today’s creative destruction is in hypermode of reducing perceived barriers between industry and its suppliers. For example, HTC used be just a provider of parts to iPhone. Currently, it is producing its own phones.

To fill the quadrants

  • What specific actions do you need to reduce below competition and/or industry standard?
  • Which action do you need to eliminate that your competition and/or industry competes on?
  • What specific factors do you need to rise above the average offered?
  • What do you need to create that your industry or competition never saw?

The Four Quadrants

After this exercise, you will have much more clear understanding if your USP is meeting the needs of your customers. The framework will also help you understand what specialization capacities your company needs to develop to achieve and sustain competitive advantage. The focus on the production of those goods or service for which a firm’s resources are best suited is called specialization. Given limited resources, managers’ choice to specialize in the production of a particular good is also largely influenced by its comparative advantage.

Closing

Your company is an important extension of your vision for this world. The gap that it fulfils is enshrined in your USP. Continually studying and researching your USP and its impact on all the players, ensures the future for your vision and higher revenue.

 

References

[1] https://rmsbunkerblog.wordpress.com/2015/12/02/how-to-measure-unique-selling-proposition-usp/

[2] http://www.inc.com/tom-searcy/5-great-questions-ceos-ask-customers.html

[3] http://www.ducttapemarketing.com/blog/5-questions-you-should-ask-every-customer/

[4] https://www.blueoceanstrategy.com/tools/

[5] http://www.investopedia.com/ask/answers/033115/what-difference-between-comparative-advantage-and-absolute-advantage.asp#ixzz3zKtPQi9R

[6] https://en.wikipedia.org/wiki/Comparative_advantage

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Activity, Output, and Outcome: What Is the Difference?

Measuring progress is not a way to find criticism or define business success. Business success is realization of the vision for your customers through your business. Any measuring framework is designed to advise on the health of the actions, processes, and the overall business. It is not the cure or medication. For example in healthcare industry, all of the modern technology is geared to produce the same result that doctors in prior centuries did – prescribed the right drug so the patient lives and/or has a better quality of life. Measuring anything is to find if your hypothesis on realizing the vision is on track or needs modifications. Execution is the medicine but it has to prescribed correctly.

Activity & Output

When measuring, just like in writing a resume, you should concentrate on the outcomes not activity or output. Concentrate on the outcomes you really want. The classic business thought is “activities are basic units of competitive advantage. Overall advantage or disadvantage results from all company’s activities, not only a few” (Michael Porter, Harvard Business Review, Nov-Dec 1996, Website). Analysis paralysis could set in if a business owner creates KPIs for every activity. As my coach told me, any measurement should be a few but distinct. I should not use measures like a drunk men using lamp post – for support not illumination. Here is an example of improper measurements from Anthony Iannarino (thesalesblog.com, 2012, Website) :

Sales managers should have no interest in requiring or measuring the number of cold calls a salesperson makes. It’s irrelevant. The measurement of calls is only useful in determining whether a new salesperson has an efficiency problem (like too little activity) or an effectiveness problem (like the need for more training). But beyond that, the raw number of calls tells you nothing about how the salesperson is doing. The calls are activity, not outcomes. A salesperson can succeed at making the number of required calls and still not succeed in their job.

As a leader, you should also look for the distinction between output and outcomes. Outcomes are the difference made by the outputs (Deborah Mills-Scofield, HBR.com, 2012, Website). Output includes revenue and profit. I would classify the unique selling proposition as an output. Every business should be judged not by its answers but by its question. The output or “the what” of firm should be seen in the context of “the big WHY” – the relationships and the consistent user experience maintained over time.

Outcome

Outcome measures the change that has occurred as the result of your product or service. The underlying assumption of all marketing strategy is the willingness of consumer to pay for the goods. From my experience, a customer need to build a sense of safety with a product or information before they can have trust in the company. Below is a list of suggested questions you should be able to answer with your outcome

  • Are the outcomes related to the “core business” of your organization or program?
  • Is it within your control to influence these outcomes?
  • Are your outcomes realistic and attainable? Are your outcomes achievable within funding and reporting periods?
  • Have you moved beyond client satisfaction in your outcomes?
  • Is there a logical sequence among your short-term, intermediate, and long-term outcomes?
  • Are there any big “leaps” in your outcomes, i.e., gaps in the progression of impacts?

(Strengtheningnonprofits)

Generally speaking, there are five different types of outcome you can adopt – financial (for the clients), behavioral, attitudinal (ex. Express delight with the new product), technical (ex. faster page load), and experiential (ex. customers receive more consistent and accurate information when they need it) (inspired from Jill Purse, ThoughtFarmer, 2014, Website).

Review of Definitions

  • Activity – Any activity that is engaged in for the primary purpose of making a profit.
    • Note: Managing activity is a morale killer (Jim Keenan, asalesguy.com, 2012, Website)
  • Output – The direct and measurable products of a program’s activities or services, often expressed in terms of units (hours, number of people or completed actions); typically designated as the accomplishment or product of the activity (University of Wisconsin-Extention)); enables business to find outcomes: important products, services, profits, and revenues.
  • Outcome – Create meanings, relationships; answers, “What difference does output/activity make?”; user experience.
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Notes on Resume

Resume is the vital ingredient for your success. Below are my notes on the key

  • What is the purpose of resume?
    • Your resume is a career marketing tool, not an autobiography.
    • Focused on your key selling points
    • Every word in the resume should sell your credentials and value to a potential employer.
    • Resume not only speaks to your past accomplishments, but it also acts as a predictor of your future capabilities.
    • Keep them in mind when deciding how much you need to change your resume to make it work for your profile.
  • Branding Statement
    • It is a statement that communicates who you are in the workplace.
      • It reflects your professional reputation
      • Showing an employer that you have goal
    • Using a profile summary or career summary is gradually fading away.
      • Instead, replace it with a branding snapshot or profile snapshot. Write the newsworthy information in short, impactful statements or with as few words as possible so they can get the facts immediately.
    • Personal branding isn’t just about the words you use; it’s also communicated visually through word pictures and images.
    • Example
      • COMMUNITY AFFAIRS MANAGER with 10 years of experience visualizing, developing, and organizing company wide philanthropic events, maintaining connections with hundreds of nonprofit organizations, coordinating diverse employee volunteer opportunities, and creating dynamic external and internal event communications.
        • Why is it successful? It gives a snapshot of your history in the field while providing branding attributes that describe what makes you successful. Also, it gives examples of previous accomplishments that offer insight into how you can help an employer succeed.
      • Career Objectives
        • The first step to creating a high-impact resume is determining what you’re trying to accomplish. With a clearly defined career objective, you can write a resume that conveys the experience, skills and training that best serve your overall professional aspirations.
        • The majority of job seekers may incorporate their career goals into a Qualifications Summary instead.
        • If you are on a steady career track, incorporating your objective into a summary sends the message “this is who I am,” rather than “this is who I’d like to be when I grow up.”
        • Give employers something specific and, more importantly, something that focuses on their needs as well as your own.
          • Career changers and entry-level workers should consider incorporating their objectives into their resumes, because their goals may not be clearly defined by their work history alone.
          • If you’re targeting a particular position, add a formal objective statement and reference the job opening. The hiring manager will see you took time to customize your resume and that the opportunity is important to you.
            • Example: “A challenging entry-level marketing position that allows me to contribute my skills and experience in fund-raising for nonprofits.”
            • For career changers: Accomplished administrator seeking to leverage extensive background in personnel management, recruitment, employee relations and benefits administration in an entry-level human resources position. Extremely motivated for career change goal and eager to contribute to a company’s HR division.
            • Entry-level workers: Dedicated CIS graduate pursuing a help-desk position.
            • When targeting a specific position: Elementary teacher for ABC School District.
          • The second step, focus on how you would benefit the employer, not on how the employer would benefit you.
            • Stay away from resume objectives that state your working preferences, such as “seeking a team-oriented environment that fosters professional development.”
            • Don’t be vague
            • Keep it concise and targeted.
              • Hiring managers often sort through hundreds to thousands of resumes to fill one job opening.
              • Make it easy on them by keeping your objective short and to the point.
                • The best resume objectives contain a desired job title or target
              • Specifics
                • Put the most important information at the top of the first page.
                • With decreasing attention spans, writing tweet-sized resume sentences is a right-on-time strategy.
                • Lack of Specific
                  • Example: “Recruited, hired, trained and supervised more than 20 employees in a restaurant with $2 million in annual sales”
                    • Both of these phrases could describe the same person, but the details and specifics in example will more likely grab an employer’s attention.
                  • Accomplishments
                    • Definition: how you contributed to your employer, or it’s an achievement that reflects the kind of worker you are. The most convincing accomplishments are measurable.
                    • Employers look for achievers, candidates who go above and beyond their job duties.
                    • Write the newsworthy information in short, impactful statements or with as few words as possible so they can get the facts immediately.
                      • Share a challenge/situation/problem, the action you took to address it, and the result. Write the result by sharing how it positively impacted your employer or client.
                    • Attempting the “One–size–fits–all” approach
                      • Whenever you try to develop a one-size-fits-all resume to send to all employers, you almost always end up with something employers will toss in the recycle bin. Employers want you to write a resume specifically for them. They expect you to clearly show how and why you fit the position in a specific organization.
                    • How long should my resume be?
                      • A resume should be long enough to entice hiring managers to call you for job interviews.
                      • It’s not just what you say but how few words you use to say it
                      • Create brief sentences that communicate key accomplishments, your branding statement, and critical information you don’t want the employer to miss.
                      • Use a one-page resume if:
                        • You have less than 10 years of experience.
                        • You’re pursuing a radical career change, and your experience isn’t relevant to your new goal.
                        • You’ve held one or two positions with one employer.
                      • Use a two-page resume if:
                        • You have 10 or more years of experience related to your goal.
                        • Your field requires technical or engineering skills, and you need space to list and prove your technical knowledge.
                        • On the second page, include a page number and your name and contact information.
                      • Visually Attractive
                        • If you want your resume to have a good chance of being read by prospective employers, you must invest time and energy not only in its content, but also in its look
                        • Allow for quickly scan the document, because it makes good use of white space, features clear and consistent section headings and uses bullets to make important items stand out.
                        • General Tips
                          • Stick with two fonts at most
                          • Use white space
                          • One-inch margins
                          • Leave some blank space between various sections of the resume
                          • Avoid underlying
                          • Many resume writers may bold their previous job titles and italicize subheadings within each section of the document.
                          • Bullets make it easier for employers to scan your resume quickly
                          • Be Consistent

 

Exercises

  • Personal Branding Statement Writing
    • Write down your vision. Think about what it is that can help you create the broad umbrella encompassing all of the specific goals your branding statement will incorporate. Examples:
      • Do you want people to communicate better with one another?
      • Do you hope to expand the breadth of our already-expansive technology?
    • Branding statement is all about showing an employer that you have goals
      • What are your career goals?
      • How do you want to make a difference?
      • Write down what you’d like to achieve—along with those skills you possess that can help you attain your goals.
    • Recognize your brand attributes, then apply them to your professional history.
      • To identify your attributes, come up with at least three nouns to describe yourself as a professional.
      • Are you a great communicator, leader, visionary, or organizer? Then drum up three sentences that round out your professional history in relation to those attributes (e.g. I have 15 years of experience leading groups through philanthropic efforts).
    • After completing these goals, you’ll have enough information to create a truly outstanding branding statement that not only gives an employer confidence in your ability to succeed but boosts your own confidence as a top professional.
      • Measure your branding statement success, can it answer
        • Recruiter’s/Hiring Manager’s “Why should I care?” or “What’s in it for me?”
      • Personal Branding Color
        • What is your personal brand color?
        • Accomplishment Exercises
          • Set a timer for five minutes, and start jotting down your accomplishments for your most recent position. Write down any accomplishment, contribution or achievement that comes to mind, even if it seems insignificant. Complete this exercise for each position on your resume. To help jog your memory, here are questions to ask yourself:
            • Did you receive praise, recognition or pats on the back from your supervisor or colleagues? For what (e.g., completing projects ahead of deadline, calming down irate customers, saving money)?
            • Did you receive a promotion, award or commendations from customers/clients?
            • Were you selected for special projects, committees or task forces?
            • Name three accomplishments that make you proud. Did you complete a particularly challenging assignment? Participate in a solution that improved customer service, enhanced efficiency, saved money/time or increased revenues?
            • Are you known throughout your department/company for something?
            • If you quit your job, what would everybody say about your work at your good-bye party?
          • Complete this brainstorming exercise, turn your accomplishments into high-impact statements. Lead with the result, outcome or benefit to your employer
          • Master Editor
            • Write a detailed version of your resume once that includes everything you think is relevant to the opportunity.
            • Then go back and remove everything that is not essential.
            • Once you’ve done that, go back and cut out everything that is not critical.
            • When you write your resume ask yourself:
              • “Is this critical to my story or what I’m trying to convey to the employer?”
              • If it isn’t, take it out of the resume.
            • Save the discarded content in a master file so you have it if you decide later you really do need it.

 


 

Source:

Monster Worldwide:

Jessica Holbrook Hernandez,

Robert Hellmann

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Web Presentations

Anything you do for you customer the impact of which is not recorded in your internal system for your future use is a waste of your customer’s time, a monitory loss for your company, and degradation of your brand. Information on the customer is the soft currency that powers the internet. The cliché – delivering what you customer wants in the right time in the right channel via the right content – can only be achieved if the customer profile is constantly updated by both marketing and sales.

Today’s customer is highly engaged and educated regardless of their background. Content marketing is the byproduct of hyper interested labor force.  The great success of the internet is not so much connecting everyone (mail and other channels did that centuries prior to TimBL’s invention), but allowing everyone to access most of human knowledge within seconds with their own tools (thus fulfilling Carnegie’s library vision). In this context, user experience expectation is not directly influenced by company or brand but by customer’s unsensational appetite to access information the way they desire.

Web presentation is an important component for your marketing tool kit. An important element of web presentation is the trust of the audience in your information. Your company’s name and the brand are impacted every time there is a web presentation. As Peter F Druker pointed out, that everyone from janitor to CEO speaks for your company and its brand. The same is true on how you conduct your webcast presentations. In every single web presentations, there are actually three meetings – before, during, and after. Each of this meeting needs to be managed in their own unique way.

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Web Presentation Marketing: Integrating Into Your Arsenal

Web Presentation is a powerful to reach across the wires to the very customers who you can help. It is the society’s answer to the drive through need for exchange of information from experts. However, just like any technology, web presentations abide by the laws of technological evolution, least of which is Schumpeter’s creative destruction. Currently, the web presentation is at the point of the category renewal. Certainly, in business lingo, webcast and others are part of weekly use by the leaders. There has been a slow down in the thought leadership around this marketing tool. It is difficult to locate searching for best practices.

Creative Destruction and innovation

Source: Strategic Management Class at the Graduate School of Business at Pepperdine University

Although various web presentation methods share a common goal – moving customers by stimulating their interest through engaging, educational, and/or entertaining content, there are key difference between different methods.

Key Definitions

  • Webinar – a term marketing people use to describe their regular online communications programs for lead generation and customer outreach. (ON24)
  • Webcast – a presentation delivered over the web that is more “broadcast” (one-way to the audience) than interactive. This difference from webinars matters because webcasts can be to larger audiences and can be recorded and replayed (CBS News, 2011)
    • Tend to be high-profile live events, often created using HD video equipment and broadcast from a conference venue, TV studio, or corporate videoconferencing room. Producers ensure every detail is perfect, creating a high-impact experience for the viewer. (ON24)
  • Web Conferences – tends to be smaller groups of people and tend to be much more interactive in nature. There tends to be application/desktop/screen sharing with a much higher likelihood for transfer of control to participants. (Lynn Rockwell, revuezzle.com/)
  • Broadcast Video – enterprise-level offering for webcasts; the focus is not just on outward-facing presentations for lead generation purposes, but in-house meetings and “town halls,” an increasingly important feature for companies with dispersed, remote workforces. (Kim Davis, The Hub, January 13, 2016)

Current State and Challenge

  • Onset of consumerization and bring-your-own-device (BYOD) trends (Frost&Sullivan)
  • The effectiveness of webcasts is contingent on not only creating compelling content, but also delivering it in ways that keep the audience engaged. (Frost&Sullivan)
  • SaaS-based enterprise webcasts grew at a robust 22.7% in 2013 (Frost&Sullivan)

Future State: Direction of Trend

“Show, don’t tell” has become a powerful mantra for effective webcasts.  A recent survey of more than 250 users revealed the strong need for video; 62% of the respondents said video is the most essential feature of a webcast, and 50% requested more video in webcast presentations (Frost&Sullivan)

Available Framework for Integrating into Marketing Mix

Leaders need to think of web presentations not as a single event but as a web experience. It is a tool of any marketing mix and should be considered. Although it is a myth that 67% of the sales journey is done digitally without involving sales, sales is still involved in the process but requires to be more prepared to deal with much better informed customers and prospects (Megan Heuer, SiriusDecisions, 2013).

Web presentation can work to fill all points of the customer’s journey. Interacting with human in real time is an important component in building trust. An important element to the dimensional of a customer journey is Bloom’s Taxonomy. Surprisingly, little to any web presentation mentions this powerful learning tool practiced by teachers. Marketing and sales using the verbs appropriate for the nature of the presentation.

There is a simple yet very intuitive table that can help shape the conversation with your audience.

ipadagogy-wheel-001

Source: Larry Ferlazzo, May 25, 2009
Note: Dianna Fisher, Oregon State University, 2011 I highly recommend to utilize the following verbs and actions in your presentation

Advance Techniques of Using Webcast in Marketing 

Web presentations can help marketers and sales acquire real-time information or confirmation on where in the customer position in the customer journey. Content can be created specifically to determine if the marketing automation’s assumption. Failure of attendance or questions can be a clear indication that the content is not stimulating any response (assuming that ignoring any marketing is the natural steady state of a customer).

Web presentations can be used in the Marketing Automation (MA). In essence, parts of marketing and sales can be done profitably by computer. Web presentations by their very nature required tremendous human effort and commitment. While MA is standardized, webcast is customized. Yet, the key elements and data feeding the two tools are very similar. What I envision, is that MA would bucket the possible subjects and corresponding customers and prospects. The system can also create time sensitivity to see if, based on CRM and other systems, customers like to consume content at various time periods (weekends, 7am to 9am).

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Philadelphia Real Estate Update

Nation-wide

  • Generation X (Millenniums)
    • Currently the largest group in the labor force (Source: Pew Research Center)
    • Consume less amount of calories than prior generation (Source: Goldman Sachs)
    • Search for experiences instead of owning (Source: Forbes)
    • Labor productivity growth is well below post-war average
  • General Housing Market
    • Slow-down in the construction of the multi-family
  • General Economics
    • The lowest growth in productivity since mid-1980’s
    • Household Net Worth is (just about) at the highest point in 25 years
    • Single-Home building is far below the 90’s average while multi-unit is above
    • Expectation of higher inventories
    • Labor participation rate is at the lowest rate since 1976

Source: Federal Reserve Bank of Richmond, otherwise noted

Theories and Prior Studies

  • Markets don’t fall from the peaks but during near-peaks
  • Studies show that most of the income growth happens before age 30’s
  • The Great Recession dampened the starting wage and wage growth of the recent college graduates
  • Current generation will have multiple jobs often requiring geographic change

 

I look at the share economy as another indication that most of the new labor is unable to live at the level of the prior generations. Optimizing or efficient use of resources is only necessary if there is a pressure on income. In the 1950’s and 60’s, US consumers continued to grow their houses’ number of car garages because of the astonishing wealth production. Today, China is looking to find efficient use for their manufacturing because of greater competition and lower demand from the globe.

One of the key drivers of Philadelphia is the wealth transfer that is happening on unprecedented scale. Pennsylvania has been the largest receiver of students while New Jersey the largest exporter. With the largest number of hospitals of any city, Philadelphia is winning at the healthcare share of the market. However, most of the hospitals operate on a very small profit margin (around 2-5%). Therefore, the high specialization wings of various hospitals are being constructed. Moreover, the wealth transfer is happening as the older generation is moving into the city to take advantage of the support resources available for senior citizens. Philadelphia has one of the largest percent of the population who are retired of major cities in the US. The Philadelphia’s Market street transportation hub is one of the best next works in the United States. That is why one of the casino applications was for 8th and Market Street. The wealth is being transferred from the suburbs. Washington and Miami are likely to overtake Philadelphia metro area in population (Source: New Geography). Although New York exported 26,957 individuals to Philadelphia (Source: Washington Post).

Source: Pew Research Center, otherwise noted

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Signs That Your Vendor Might Not Be Right Fit for You

“Error is feature until you discover it”

The following is just a short list of my experience with vendors. There is no particular order (just like the poor vendor).

  • Move dates of major deliverables
  • The vendor says, “This is harder than we expected”, repeatedly. Uses that as excuse to not deliver a promised task.
  • Does not do what is assigned
  • No or nominal innovative, new, or exciting ideas proposed by the vendor
    • No thought leadership
    • Look to your team to create new innovation for them (“you pay for their improvements/innovation” without giving your company any IP or stake)
    • Present that innovation as their and present it to your competitors
    • Uses jargon or big words without specificity
  • You require daily meeting to assess the progress of every project step
  • Requirements documents
    • Provide too broad of description
    • Jump into specification of what they are going to do
    • Not have requirements document
  • Rely on your team and your other vendors to provide insights into the data even after months working with internal stakeholders
  • Duckspeak – much words are used by your vendors to described the project or their risk but you are still unclear what is the status of the project
  • Constant change of workers and leaders involved in your project
    • Sudden and unexplained departure of key project players on the vendor side
    • No warning or knowledge transfers
  • Consistently change the pricing model between each presentation deck
    • Produce ever increasing
  • Minimum connection between the sales presentation and the deliverable
  • No concrete discussion and commitment for the post-implementation support for the data, data infrastructure
  • End user administration is either confusing or relies too heavily on your team
    • No thought out process
    • No thought out support process
  • Constant need to supply password as there are several different technologies build one on top of the other
  • Unable to improve customer experience
  • Didn’t account for validation period in the project plan (ie time after the project/process completes and before it is released for general consumption)
  • Vendor argues with the company that hired them
  • Charges you for the work that they did not finish
  • Budget is not itemized
  • Require constant supervision of projects and/or tasks. As soon as you woke away, the tasks are not done
  • Prioritizing other projects given to them over your projects
  • Tries to sell what they developed at your company to your competitors
  • Below standard maintenance agreements.
    • Maintenance agreement is not discussed at the start of the project/program
  • Key players take extraordinary amount days off before key deliverables deadlines
  • Program manager acts as project manager
    • Program manager works on other projects that not tied to your program or (even) company
Standard