Timeless Marketing & Sales Lesson #7

Want to know the most important and powerful marketing phrase of all time?

The most important and powerful marketing phrase of all time is “Let me tell you a story.”

Edward Bernays, nephew to Sigmund Freud and one of the founders of public relations, once said, “Don’t send out news releases, send out news stories.”

How did Jesus Christ go about teaching his disciples and followers? Was it through a corporate memo from the big man upstairs or was it from Parables and stories that ring as true today as they did when the carpenter from Nazareth told them some 2,000 years ago.

When we were all children, we lived for story-time. Stories captured our attention and ignited our imaginations. Stories were how we learned about so many different aspects of life. Stories were how we were persuaded to do and believe certain things.

Now that we are all grown up and have become successful business people, we often believe we are too mature and sophisticated for stories. We want our friends, families, colleagues, and peers to perceive us as big and tough business people, not kindergarten teachers. “Don’t tell me a story. Just give me the facts and figures.”

In many ways, we have all turned into Joe Friday. “Just the facts ma’am. Just the facts.”

The more I study I adult behavior, the more I realize we were all better off when we thought like children.

The reality is your friends, families, colleagues, and peers don’t want to be treated like robots, who simply input and process information. They want to be treated like children. They want to be told stories about your product, service, and company. They want you to capture their attention. They want you to ignite their imagination. They want a good reason to believe in your product, service, and company.

Story telling has always been and will always be the most important marketing medium in the world. If you ignore it, people will most likely ignore you, your company, and your product or service.

If you need to retrain your adult mind and relearn the art of storytelling, here is a great article marketing guru Seth Godin wrote for Ode Magazine (emphasis mine):

Great stories succeed because they are able to capture the imagination of large or important audiences.

A great story is true. Not necessarily because it’s factual, but because it’s consistent and authentic. Consumers are too good at sniffing out inconsistencies for a marketer to get away with a story that’s just slapped on.

Great stories make a promise. They promise fun, safety or a shortcut. The promise needs to be bold and audacious. It’s either exceptional or it’s not worth listening to.

Great stories are trusted. Trust is the scarcest resource we’ve got left. No one trusts anyone. People don’t trust the beautiful women ordering vodka at the corner bar (they’re getting paid by the liquor company). People don’t trust the spokespeople on commercials (who exactly is Rula Lenska?). And they certainly don’t trust the companies that make pharmaceuticals (Vioxx, apparently, can kill you). As a result, no marketer succeeds in telling a story unless he has earned the credibility to tell that story.

Great stories are subtle. Surprisingly, the fewer details a marketer spells out, the more powerful the story becomes. Talented marketers understand that allowing people to draw their own conclusions is far more effective than announcing the punch line.

Great stories happen fast. First impressions are far more powerful than we give them credit for.

Great stories don’t always need eight-page color brochures or a face-to-face meeting. Either you are ready to listen or you aren’t.

Great stories don’t appeal to logic, but they often appeal to our senses. Pheromones aren’t a myth. People decide if they like someone after just a sniff.

Great stories are rarely aimed at everyone. Average people are good at ignoring you. Average people have too many different points of view about life and average people are by and large satisfied. If you need to water down your story to appeal to everyone, it will appeal to no one. The most effective stories match the world view of a tiny audience—and then that tiny audience spreads the story.

Great stories don’t contradict themselves. If your restaurant is in the right location but had the wrong menu, you lose. If your art gallery carries the right artists but your staff is made up of rejects from a used car lot, you lose. Consumers are clever and they’ll see through your deceit at once.

Most of all, great stories agree with our world view. The best stories don’t teach people anything new. Instead, the best stories agree with what the audience already believes and makes the members of the audience feel smart and secure when reminded how right they were in the first place.

Timeless Lesson: Tell stories

Why Incentives Matter

I came across this wonderful parable from Matthew May's blog:

An old woman lived alone on a street where boys played noisily every afternoon. One day, the din became too much, and she called the boys into her house. She told them she liked to listen to them play, but her hearing was failing and she could no longer hear their games. She asked them to come around each day and play noisily in front of her house. If they did, she would give them each a quarter. The youngsters raced back the following day, and they made a tremendous racket playing happily in front of the house. The old woman paid and asked them to return the next day. Again they played and made noise, and again she paid them for it. But this time she gave each boy only 20 cents, explaining that she was running out of money. On the following day, they got only 15 cents each. Furthermore, the old woman told them she would have to reduce the fee to a nickel on the fourth day. The boys then became angry and said they would not be back. It was not worth the effort, they said, to play for only a nickel a day.

This parable reminds me of what Charlie Munger once said about incentives:

......Another thing, perverse incentives. You do not want to be in a perverse incentive system that’s causing you to behave more and more foolishly or worse and worse - incentives are too powerful a control over human cognition or human behavior. If you’re in one, I don’t have a solution for you. You’ll have to figure it out for yourself, but it’s a significant problem.

Leasing 101 - Part 5

5) Rates: Never what they seem

• Net vs. Gross vs. Modified Gross Rates: What’s the difference and why does it matter?
• What does the rate include? Taxes? Insurance? Operarting Expenses? Etc.?
• What doesn’t the rate include? Taxe? Insurance? Opearting Expenses? Etc.?
• Are there annual bumps in the rate? If so, are they at, above, or below market?
• What is the rate on any option included in the lease? Has it been pre-neogiated or is it to be determined at the time the option is exercised?
• What is the rate on holdover rent?

Far too often, tenants get caught up in comparing price per square foot withotu considering if they are comparing apples-to-apples or apples-to-organges.

The first question to ask after a rate is quoted is "What's included or not included in that number?"

Randomness

Please read this fascninating piece from the July 3rd Wall Street Journal by Leonard Mlodinow, professor of randomness at Cal Tech.

This is an extremely thought provoking article, and I believe it gets at the heart of how we get oursevles into our current financial mess.

Here is an excerpt from the article:

In sports, the championship contenders are usually pretty evenly matched. But in baseball, even if one assumes that the better team has a lopsided 55/45 edge over the inferior one, the lesser team will win the seven-game World Series 40% of the time. That might seem counterintuitive, but you can look at it as follows. If you play a best-of-one game series, then, by our assumption, the lesser team will win 45% of the time. Playing a longer series will cut down that probability. The problem is that playing a seven-game series only cuts it down to 40%, which isn’t cutting it down by much. What if you demand that the lesser team win no more than 5% of the time—a constraint called statistical significance? The World Series would have to be the best of 269 games, and probably draw an audience the size of that for Olympic curling. Swap baseball for marketing, and you find a mistake often made by marketing departments: assuming that the results of small focus groups reflect a trend in the general population.

We find false meaning in the patterns of randomness for good reason: we are animals built to do just that. Suppose, for example, that you sit a subject in front of a light which flashes red twice as often as green, but otherwise without pattern. After the subject watches for a while, you offer the subject a reward for each future flash correctly predicted. What is the best strategy?

A nonhuman animal in this situation will always guess red, the more frequent color. A different strategy is to match your proportion of red and green guesses to the proportion you observed in the past, that is, two reds for every green. If the colors come in some pattern that you can figure out, this strategy will enable you to be right every time. But if the colors come without pattern you will do worse. Most humans try to guess the pattern, and in the process allow themselves to be outsmarted by a rat. (Those trying to time the market lately might wish they had let the rat take charge.) Looking for order in patterns has allowed us to understand the patterns of the universe, and hence to create modern physics and technology; but it also sometimes compels us to submit bids on eBay because we see the face of Jesus in a slice of toast.

Scratching Hogs

This story, from the book My Voice Will Go With You: The Teaching Tales of Milton H. Erickson, contains one of the best sales tips you will ever find.

One summer I sold books to pay my way through college. I walked into a farmyard about five o'clock, interviewed the farmer about buying books, and he said, "Young fellow, I don't read anything. I don't need to read anything. I'm just interested in my hogs."

"While you're busy feeding the hogs, do you mind if I stand and talk to you?" I asked.

He said, "No, talk away, young fellow, it won't do you a bit of good. I'm not going to pay attention to you; I am busy feeding the hogs."

And so I talked about my books. Being a farm boy, I thoughtlessly picked up a pair of shingles lying on the ground and started scratching the hogs' backs as I was talking. The farmer looked over, stopped, and said, "Anybody knows how to scratch a hog's back, the way hogs like it, is somebody I want to know. How about having supper with me tonight and you can sleep overnight with no charge and I will buy your books. You like hogs. You know how to scratch 'em the way they like to be scratched."

Outliers by Malcolm Gladwell

Here is a recent review I wrote of Malcolm Gladwell's latest must read book Outliers:

Natural talent: We hear the phrase spoken often about composers like Mozart, computer programmers like Bill Joy, software geniuses like Bill Gates, and musical groups like the Beatles. We cannot all expect to be as successful as the Beatles or Mozart because we were not born with their natural talent. Or at least so go the musings from the peanut gallery of the less-than-successful.

In his latest book, Outliers, Malcolm Gladwell, bestselling author of The Tipping Point and Blink, shatters many popular notions about success and proves again why he is one of the most interesting, intelligent, and talented writers of our time. Gladwell’s book helps readers understand what an outlier is—a value, observation, event, etc. that is numerically distant from the rest of the data —and why outliers matter.

In Outliers we get what business books should really be like; part psychology book, part business book, part history book, part sociology book, and part anthropology book. You don’t have to worry about going cross-eyed from reading too many business buzz words or meaningless platitudes. Outliers is chock full of amazing, interesting, and educational lessons about opportunity, success, and failure.

One such lesson is the triumph of hard work over natural talent. Gladwell demonstrates that bands like the Beatles, programmers like Bill Joy, chess prodigies like Bobby Fisher, and billionaire software gurus like Bill Gates didn’t achieve success because they were talented. They achieved success because they were talented and willing to apply 10,000 hours of practice to their respective crafts and trades. “Practice isn’t the thing you do once you’re good. It’s the thing you do that makes you good.”

To illustrate the value of the 10,000-hour rule as he calls it, Gladwell introduces readers to some interesting history about the Beatles. What most people don’t know about the Beatles is that they perfected their craft playing seven days a week for eight hours at a time in front of live audiences in strip clubs in Hamburg, Germany. Over a two-year period from 1960–1962, the Beatles played 270 nights in strips clubs throughout Germany. By the time they had their first bout of “real” success in 1964, they had played 1,200 times together as a band. The Beatle’s success is more a result of their hard work than their natural talent.

But Gladwell doesn’t stop there. He challenges our notions of success in every chapter with questions like: Why are so many of Canada’s elite amateur hockey players born in January or February? Why of the seventy-five richest people in human history are fourteen Americans born within nine years of each other? Why is the smartest man in the world (at least according to his IQ) living on a horse farm in Northern Missouri writing a book on the theory of everything no one cares about? What does rice farming have to do with being great at math? Why are there so many family feuds in Kentucky? Why are so many of today’s top Wall Street law firms run by people of Jewish descent?

If you think these questions are intriguing, wait until you read the stories that accompany them.

This book will amaze you, frustrate you, inspire you, and leave you wanting more. But, most importantly, it will help you understand the roots of and pathways to success. Here’s a hint: it’s not just about natural talent. And isn’t that good news for us mere mortals?

Montier on Impediments

I just got through reading the slides from a recent presentation given by James Montier.

I was really struck by what he called his Five Impediments to Recognizing Predictable Surprises. The five impediments are:

1) Over-optimism

2) The illusion of control

3) Self-serving bias

4) Myopia - nearsightedness

5) Change Blindness - phenomenon that occurs when a person viewing a scene apparently fails to detect large changes in the scene

Leasing 101 - Part 4

4) Prioritize: All things are never equal

• What is the most important thing to you and your company?

o Do you care most about?

§ Location?

§ Rate?

§ Amenities?

• Rate these three in order of importance
• Do not waste time looking at spaces that do not meet your number one requirement

Timeless Marketing & Sales Lesson #6

How would you like to write a piece of copy that pulls a 100 percent response rate?

In case you are wondering, a typical direct mailing produces a 1–5 percent response rate.

In 1925, Bruce Barton, one of the founders of the BBDO advertising agency, wrote a fundraising letter for Berea College in Berea, Kentucky. The letter, which was sent to 24 people, asked for each recipient to reply with a check for $1,000 ($1,000 was a lot of money in 1925). All 24 recipients of Barton’s letter responded—some even more generously than Barton requested—and Berea College was $30,000 richer.

How was Mr. Barton able to achieve this miraculous feat? He followed the three rules that should be tattooed on the foreheads of anyone who wants to communicate more effectively with his or her customers, colleagues, peers, or husband or wife.

1) Brevity: "About sixty years ago two men spoke at Gettysburg; one man spoke for two hours. I suppose there is not any one who could quote a single word of that oration. The other man spoke about three hundred words, and that address has become a part of the school training of almost every child."—Bruce Barton

—Being brief—concise, not short in length—means learning how to make every word count and every sentence impactful.

2) Simplicity: "I think it might be said, no advertisement is great that has anything that can't be understood by a child of intelligence. Certainly all the great things in life are one-syllable things—child, home, wife, fear, faith, love, God."—Bruce Barton

—Writing simply means knowing your audience and then carefully choosing language they will easily understand. If you want to show off your vocabulary, write for an academic journal.

3) Sincerity: "I believe the public has a sixth sense for detecting insincerity, and we run a tremendous risk if we try to make other people believe in something we don't believe in. Somehow our sin will find us out."—Bruce Barton

—Being sincere means always believing what you say.

Timeless Lesson: Be brief, simple, and clear in all of your communications.

If you want to read Mr. Barton's letter in full, and I highly recommend that you do, please click here.

A Letter

Before my wife married in June of 2005, I sent Governor Mark Sanford (see latest thought on Governor Sanford here) a letter asking for any advice he could provide to a young man about to embark upon one of life's greatest and most difficult journeys.

Here is the response I received:

Dear Stephen,

Thanks for your letter, and congratulations on your wedding in June. You were generous enough to ask for a few pearls of wisdom on the marriage front, so here are a few thoughts from one who has yet to earn all his marriage badges in this chapter of life.

If memory serves me correctly, I'm thinking about a Scott Peck book called The Road Less Traveled. This book, or one I'm confusing with it, talks about moving from independence or dependence to interdependence. My sense of an ideal marriage - and it takes experiences together, time and maturity to reach this point - is that you have the union of two people perfectly able to stand on their own. They come together knowing that their lives will be more fulfilling and meaningful by choosing to build a life together. In this regard, view your marriage as a partnership, and extend to your wife the same courtesies in communication you would extend your business partner. Surprisingly a lot of couples don't, and from unintentional and small communication lapses grow big differences. Jenny and I try to consult with one another a lot, and it has paid dividends.

Forgive - and forget. Apologize. In James the Bible says never let the sun set on your anger. It is great advice. If you have to stay up all night fussing until the issue is resolved, do it. Don't let
anyone go to bed brooding because only bad will grow from it. In resolving these issues, take Steven Covey's advice from his book The Seven Habits. He says seek first to understand - then to be understood.

The Bible charges men with the role of head of household. We set the tone and among other things are responsible for the spiritual condition of the household. Be willing to assume leadership. Part of that means to love her when that is not the mood of the day, she will respond, but you have to consistently take that all important first step. God gave you a mission in life, be sure to in some way incorporate her in it. She will be thankful and like all women want to be part of a mission impossible that is bigger than just cleaning dishes and washing the baby's diaper.

Thank her for the little things she does. I do a poor job of this, and it is worth focusing on.

Keep it fun. Don't let spontaneity die. Take time to smell the roses along the all too short path called life.

My life has been made richer by our friendship Stephen. Thank you again for it and again congratulations.

Sincerely,

Mark Sanford

I am not posting this letter as some sort of "gotcha" moment. Governor Sanford and his family are going through enough without having the likes of somone like me trying to pile on whenever they can.

This letter was great advice in 2005 before I had lived one day as a husband, and it's even better advice after four years of marriage. I thought so highly of this letter and the advice Governor Sanford imparted that I had the letter framed.

I am posting this letter because it is my hope and prayer that Governor Sanford will remember the words he wrote to me in 2005 and be the husband and leader he recommends that I strive to be.

After observing over the last few days the actions and reactions of Jenny Sanford to this whole mess, I thought it would be appropriate to end this post with this passage from Mr. Churchill:

My ability to persuade my wife to marry me was quite my most brilliant achievement.....Of course, it would have been impossible for any ordinary man to have got through what I had to go through in peace and war without the devoted aid of what we call, in England, one's better half.