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Prime issues with Amazon

Amazon Prime is one of the most popular loyalty programs in the country, and Amazon customers enjoy very high satisfaction levels. However, it seems that people are sorting themselves out into pro- and against-Amazon, as they are in so many other areas. (The 'against' group is definitely the minority.)

Amazon prides itself in operating on the edge of innovation, and that means breaking lots of rules. I don't object to that behavior in general, but Amazon often ignores human values which are core to me, such as fairness and protecting the vulnerable. That's why I don't buy from them if I can avoid it. 

The Verge: Why I'm never signing up for Amazon Prime, 2017-Jul-11 by Vlad Savov 

I don’t expect anyone to follow or join me in resisting Amazon’s primal pull toward Prime. You’ve got your own priorities in life and, in all honesty, nobody’s going to fix global injustice by disregarding Prime Day and taking a nice walk outside instead. But it makes me feel good to do exactly that, and so — in the ultimate expression of consumer choice — I’m opting not to consume Amazon’s enchanting deals elixir.

(By the way, this article has one of the best comment threads I've ever seen.)

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Profitless to compete with Amazon?

Speculation about how Amazon will change Whole Foods is running rampant. I click on news stories only to find that experts are being quoted who have absolutely no real information about what Amazon plans to do. Why would Amazon tip their hand at this point anyway??

One thing is clear. The grocery business will be restructured. At least Krogers' CEO expects it will

Vox: The real reason Amazon buying Whole Foods terrifies the competition, 2017-Jun-20 by Matthew Yglesias

Competing with Amazon is terrifying for any incumbent business because the company’s executive team operates on a radical model whereby the company’s overall net income is nearly zero quarter after quarter.

That is by design, not because they can’t come up with any ways to make money. On the contrary, to the best of anyone’s knowledge many of Amazon’s specific lines of business — including, notably, Amazon Web Services — are perfectly profitable. But while Apple, Google, Microsoft, and Facebook hire lawyers and accountants to amass vast stockpiles of cash legally held in overseas tax haven subsidiaries, Amazon simply chooses to barely accumulate any cash at all.

That’s an enormous problem for every grocery chain in America, which already operate on razor-thin margins. Nobody thinks Amazon bought Whole Foods in order to siphon off Whole Foods’ operating profits in order to subsidize something else. A Whole Foods under Amazon’s stewardship will almost certainly accept lower profit margins than it does as an independent chain — and that spells trouble for everyone else in the grocery business. 

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Of course the nightmare scenario for the supermarket industry is that acquiring Whole Foods does allow Amazon to fundamentally crack the grocery home-delivery game in a way that leads Kroger to go the way of Borders.

But the reason the takeover is such a disaster for the industry is that the financial implications are bleak even if Amazon doesn’t succeed in bringing incredible game-changing innovation to the sector. Introducing a player into the market that doesn’t care about profit margins is going to be devastating to competitors who have to.

They won’t necessarily be put out of business, but they will be forced to respond to lower prices and lower margins with lower prices and lower margins of their own — making the current round of dividend hikes extremely difficult to maintain. From the standpoint of an executive at a conventional business it must seem extraordinarily unfair. 

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Expect a random walk with your prospects

Customer journey mapping has helped companies improve their customers' experience, but we have to be smart about the fact that it's just a tool for planning and for empathizing with our customers. How customers actually decide and adopt our services is very unpredictable, and we should keep studying the real data all the time.

VentureBeat: The 'path' to purchase is really a random walk, 2017-Jun-11 by Jason Carmel

As an example, a study by the travel company Expedia found that people make, on average, 140 visits to various travel sites in the 45 days before making an actual booking. That’s just one channel (web). Imagine how many other influences, from social media to TV, to friends and family, also impact that one purchase decision. Even in the most poetic sense, that is no discrete “path.” Yet the entire ad industry develops campaign strategies, buys media, and tracks success based on this fiction. This weights channel preferences to those that benefit from last click attribution, which subsequently weights budgets to those media as well.

It might finally be time to throw away the “path” metaphor altogether. This is by no means the first call or attempt to do that – we have seen purchase “stages,” “loops,” “funnels,” and “sine curves,” all striving, with varying degrees of success, to put a more nuanced framework of order around the chaos that is purchase decision making. But it is precisely in that adherence to “order” where most of these frameworks break down. Most of our decision making, some experts put it as high as 95 percent, happens at a subconscious level, influenced by dozens of known and unknown variables far beyond the marketer’s control. Forcing that messiness into an order is folly. It’s time we embrace randomness...

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Using micro-goals to stay on track toward our goals: the big picture is our enemy.

"Chunking," or breaking down a project into micro-goals, has long been recognized in productivity coaching. However, it's also extremely important in motivating co-workers. We tend to spend too much time on the vision and not enough time kicking around little ideas to move the project down the road. Recognizing the success of every micro-goal is vital. I love Scordo's quote... 

The big picture is actually your enemy.

Scordo.com: How To Achieve Goals: Micro-Goal It And Keep It Simple by Vincent Scordo

Now, I don’t have a window into Federer’s brain (only he knew what he was thinking on Sunday) but his keen ability to simply win the tennis match; namely, keep the ball between the lines until your opponent makes an error or misses a shot is a superb practical life skill.  Here are a few others that may help you achieve a few goals of your own (albeit maybe less impressive than 16 Grand Slam tennis championships):
1. Tune out unimportant variables.  When you want to achieve something specific it’s not good to act or think philosophically.  The big picture is actually your enemy.
2. Don’t change your style or approach if it works most of the time.  For example, if you’re a good saver and have had success with investing in low risk vehicles (like a traditional savings account, CD, bond, etc.) don’t begin buying large quantities of securities because the current trend is big returns on your money.  In the long run, you’ve probably picked an approach that has worked and switching tactics will not get you closer to a particular goal.
3. Surround yourself with people who think like you.
4. Avoid panic until the last possible moment.  Staying calm is a great life skill; in addition to preserving your blood pressure and heart the ability to maintain a calm mind helps you stay relaxed and avoid pressure and a muddled perspective (remember you want laser like clarity on your end goal).  Having said the above, I do advocate letting the steam escape at some point.
5. Prepare.  If you know how to do it and have proved to yourself that you can achieve a goal then doing it again is a matter of being well prepared.
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The Anti-Amazon: T.J. Maxx

A strong commitment to a clearly differentiated strategy is serving T.J. Maxx. One of the hardest things for a business to do is say, "no, that's not our customer," but they know what they're doing in ignoring e-commerce. 

Forbes: How Walgreens and T.J. Maxx Are Winning With Minimal Online Sales, 2017-May-25 by Barbara Thau

The retailer’s store vibe — disheveled racks, DMV-esque lighting, barebones customer service —belies the oft-cited “experiential” checklist of what a brick-and-mortar retailer is supposed to need today: mobile checkout options, sales associates with the chops of a personal shopper, and perks from cafes to cooking classes.

T.J. Maxx has none of that.

What they do deliver shoppers is the thrill of the hunt of designer duds for a song. It marks the work of a 1,000-person buying organization and global-sourcing gurus that collaborate with 18,000 vendors from more than 100 countries in a bid to fill its unglamorous stores with an ever-changing mix of fresh and surprising finds.

As a result, T.J. Maxx is “un-Amazonable,” Chen [Oliver Chen, retail analyst at Cowen & Co.] in another research note this month. That’s because “customers engage in an in-store treasure hunt, many brands have preferences not to be online, and average ticket and prices are sufficiently low relative to shipping costs of $5 or more.

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