WARNING: Is Your Message Effective?

16 Jan

An Attempt To Use A “Nudge” To Make A Better Climate Message

If you could send an environmental message to drivers every time they fueled up at the pump, what would be the most effective message? Could you influence their consumption behavior?

This is not a hypothetical question. An environmental activist group, 350.org, may succeed in convincing Bay Area officials to let them place warning stickers (see below) on fuel pumps at gas stations alerting consumers to the connection between gasoline usage and greenhouse gases.

But behavioral economics research suggests that the stickers proposed by 350.org will not have much effect:

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As a serious suggestion to the 350.org folks (I’ve actually reached out to their campaign team – no response yet see update at bottom), here are some ideas on how to make their message more effective and more likely to influence people.

Why It’s So Hard to Create Effective Environmental Messaging

Behavioral economics, in a nutshell, analyzes how heavily people’s decisions are influenced by the way information and choices are presented to them. It has long been an interest of mine – I’ve previously written about about framing effective non-profit messages (“Screw the Polar Bears“) and default choices (“Why Soccer Pundits are Sheep“). And I’ve just recently finished the easy-to-read behavioral economics book Nudge, which has influenced policy makers worldwide with its explanations of “choice architecture.”

I’d summarize the problem that 350.org faces – as it relates to behavioral economics and in influencing public opinion – as follows:

  • People make rational decisions (in their self-interest) when they see the clear and immediate consequence/reward flowing from their choice.
  • But, even though people have good intentions, they don’t make rational choices when the reward: (1) occurs at some uncertain time in the future; (2) is hard to directly connect to any specific act or choice; (3) requires doing something different from the status quo; (4) requires doing something different from everyone else; (5) has a high present perceived cost, but a far-in-the-future reward.

So environmental messaging is really tough, because it’s difficult to convey how any particular choice today will affect the climate some time in the future. Nobody got into their car this morning and thought, “If I don’t drive today, I’ll have to rearrange my entire schedule, but I might stop the polar ice caps from melting, oceans from rising, and half my city from sinking into the sea.”  Because that’s crazy.

Too dramatic?

Too dramatic?

But at the same time, that’s basically what environmental activists want/need to achieve.

And the big problem with the proposed warning stickers, is that all they do is “warn.” Even if they successfully convinced drivers that fuel consumption produces CO2, and that CO2 causes climate change, that would not cause a change in behavior – in this case, decreased fuel consumption.

How do I know? Because 43 million Americans still smoke.

Don’t get me wrong, in the 50 years since the first Surgeon General warnings of smoking’s health effects, millions of lives have been saved in what has been called “one of the great public-health successes of the 20th century.”

But virtually everyone in the U.S. knows that smoking causes cancer (including smokers) and yet tens of millions of Americans chose to smoke even though they know the facts.

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Why? Because, in addition to being addictive, (1) the health “cost” of smoking comes far down the road; (2) no single drag or cigarette can be identified as causing cancer; and, (3) social norms – many people smoke because their friends smoke. And, unlike fuel consumption/climate change, your decision to smoke will affect your health (and those closest around you).

If 43 million Americans still smoke, even knowing the long term consequences for them personally, what chance does a warning sticker at gas pumps have of changing people’s fuel consumption?

Because the costs are so detached from any one individual’s conduct, and because cars are such a routinized part of most people’s lives, I doubt that simply informing people about the link between driving and climate change would have any effect.

So what might work?

How to Make an Effective Message

The question/challenge is: what message on a sticker at a gas pump would have the highest likelihood of impacting people’s awareness and behavior? Admittedly, until the Statute of Liberty actually gets swallowed by rising tides in real life, very little will change.

But behavioral economics research gives some clues on how to maximize the effectiveness of a message. In fairness, the folks running the warning sticker campaign do seem to be aware of some of these principles, but their message seems targeted to people’s “reflective system” or active cognitive (mindful) thinking. They are trying simply to “inform” and appeal to people’s intellect.

An alternative approach might be to appeal to their automatic thinking system. Filling up at the gas station is such an ingrained activity, that the message needs to reach deeper and challenge that routinized, mindless behavior.

1. Social Norms Heavily Influence Behavior

People are influenced by the behavior of their peers.

A hotel chain provided a great example. The hotel wanted to encourage guests to re-use their towels rather than getting fresh ones every day, to save money and decrease environmental waste (from all the water, energy and chemicals used to clean the extra towels).

The most effective message was not “help save the environment.” It was one telling the guests that 75% of guests staying in the same room re-used their towels. The message increased towel use by 25%.

When people believe others just like them are doing something different, they are much more likely to conform their behavior to that perceived “norm.”

Here, the sticker could take advantage of the fact that Americans are actually already using their cars less, in a trend that has been ongoing for almost a decade. If people believe that others are consuming less gas, they will be inclined to follow this trend.

2. Personal Messages Are Much More Effective

In the U.S., at least, people are much more motivated by messages that appeal to them personally, rather than appealing to their sense of the greater good, as a study from Stanford found recently. I wrote about this previously. Telling people the link between fuel consumption and climate change in general is unlikely to influence behavior, for all the reasons I’ve described above.

Shining the spotlight on an individual is a well-known behavioral bias, which can be useful in this context. Drawing attention to someone’s own conduct, while contrasting it with everyone else’s actions, can be leveraged to influence that conduct.

In the gas pump sticker context, making someone think about their own fuel consumption, and attempting to compare it to other’s consumption, could be an effective way to start to challenge their patterns.

So What Could a Sticker Look Like?

Okay, time to put everything above together. We want a sticker that (1) informs people about the link between climate change and gas consumption; (2) makes them think about their own consumption; (3) nudges them to possibly reduce their own consumption. That’s a lot of work for a sticker to do. And, as I’ve discussed extensively, because I think simply “informing” people will not be very effective, I’m going to place more emphasis on #2 and #3.

Here’s the sticker:

Proposed Gas Pump Sticker

The first time someone fills up and sees the sticker, they might be confused. But it will likely draw their attention.

The second or third time they see the sticker at the pump, they will start to remember they’ve seen it before. They may even read the smaller print.

The fourth or fifth time they see the sticker, they may begin to realize “Wow I actually see this sticker a lot.” And they may be curious enough to think about how often they are filling up at the pump. And they may even consider their consumption in relation to others (social norms), and the effect of their consumption on greenhouse gases.

In a small percentage of cases, people might actually consider whether/how they could drive less.

I don’t pretend for a second that a sticker alone would have any major effect on consumption, but I believe it has several major advantages to 350.org’s warning sticker: (1) It would draw much more attention; (2) It would draw attention to the activity of the individual (amount of driving) rather than just to the total effect of everyone driving (climate change); (3) It would likely gain people’s attention on multiple occasions, rather than a warning sign which people tend to ignore after seeing once.

In any event, I realize my message is more provocative and controversial than 350.org’s warning sticker, and would be a harder sell to government officials whose blessing is apparently required. But given an opportunity to blanket every gas station in a city or state with a message, wouldn’t you try to make that message as effective as possible?

UPDATE: I got a great response back from Jamie Brooks from 350.org.  He agreed that more personal messages are more effective.  But, as I suspected, they are concerned about the legal scrutiny of a more opinion-based message, especially when it is being mandated by a local government.  Ironically, of course, some people are still skeptical about the link between climate change and human activity, but yet it’s an undisputed fact that Americans are driving less today than they did ten years ago!

How to Write the Perfect “Cold Call” Email to Get Feedback and Sales

17 Dec

Keep it very short, focused, and goal-oriented.

My post on the 5 things that don’t make you an entrepreneur generated a ton of questions. Many people asked about how to reach out to potential customers to validate whether there’s a need for your product.

“Cold Call” Emails

When done correctly, “cold call” emails can be surprisingly effective for both startup founders and sales teams in order to start discussions with decision-makers at large companies.

At Zenput, we successfully did this to sell to senior execs at large publicly-traded companies. And when I was working on my gimme.it idea (mentioned previously), I used cold emails to get feedback from marketing VPs at large retailers, even though I didn’t have a business, website or anything more than an idea.

Once you get over a couple of mental hurdles, and understand how to use email to generate sales leads or feedback, this technique can be incredibly powerful for both entrepreneurs and sales people.

Some Philosophical Keys to Emailing Strangers

There are two keys to understanding cold call emails: (1) the objective of the email; (2) the numbers game.

First, the goal of cold emails is to start a conversation. That’s it. You are not selling and not pitching through your email, you’re only starting a conversation. You actually need to forget about your solution and focus on your contact’s problem. You are just trying to find people with the problem you want to solve. And realistically that’s the only  reason someone will respond to an email from a stranger – they have an important problem that they really want to solve. Your goal through this process is to talk to them about, and understand, their problem. Your email should be directed to that, and nothing else.

Second, emailing strangers fails – most of the time. But that’s okay. Once you internalize that, and understand that your overall success rate will be in the single digits, your whole approach will change. Send out 20 emails, and if you’re lucky you’ll get one or two responses. Send out 100, and you’ll get a whole handful of responses. (By the way, how do you come up with those email addresses? See the bottom of this post.)

You will only start to succeed with cold emails when you understand what they do – they help you figure out who your customers will be, what problems they need solving, and hopefully they will generate some quality leads.

But that’s all a cold email can do. And there’s still lots of heavy lifting from there, but that is a great place to start.

So what goes into that email?

In my mind, here are four of the five main components. We’ll get to the fifth afterwards.

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1. Put a ton of thought into the subject line.

Think about what you see when you open your inbox in the morning. Two things: the sender and the subject line. Within less than a second, you’ve decided whether to open or delete the first message you see.

Are either of these subject lines remotely interesting to open?

Are either of these subject lines remotely interesting to open?

Because the recipient doesn’t know you, you need to create a reason to open the email. But you need to do so without sounding scammy or like you’re trying to sell something (which, remember, you’re not, at this stage).

Focus on the problem you’re trying to solve. Try to create some urgency.

So let’s say you’re creating a mobile app that helps corporations with their travel planning. There’s a temptation to have a subject line like:

• Eliminate travel logistics hassle
• Reduce travel costs

But those are clearly marketing emails, selling a solution. All you want to do is identify a problem to chat about. So focus on the problem, and try to create a small sense of urgency:

• Recent problems with local air travel
• Travel costs exceeding travel budget

At Zenput, using emails that have focused on the problem rather than the solution, we had open rates exceeding 40%. The more compelling the subject, the more eyeballs you have reading the actual email. It’s that simple.

2. How to begin the email.

This is tricky. You’ve convinced someone to open the email, but how do you get beyond the first paragraph when they realize you’re asking them for something? Two strategies.

First, make it clear that you don’t know the person. Use a phrase that’s polite but honest about why you’re contacting them. Something as simple as “I wanted to reach out about . . .”

And then, second, follow up with social proof. This is key. You need to convince them why they should keep listening. Ideally, you can tell them about someone else using your product or who has written an article about your product. Or, find some connection – anything – even if it’s just a common LinkedIn group, a demonstrated shared interested, or some relevant achievement from your past. But find something that gives the reader confidence that it’s worth their time talking to you.

3. Keep the email unbelievably short and don’t bother personalizing it

There’s a natural temptation to tailor every word in the email to speak directly to each person you’re contacting. Here’s the truth: it’s not worth it (unless you have some specific personal connection – see Social Proof above). The recipient is not going to spend enough time reading your email for it to matter.

Either you’ve identified a sufficiently big problem in their work that they’re willing to respond, or they’ll hit delete. Overly personalizing the email won’t change that. In fact, it will probably distract attention from the business problem during the five seconds of mindshare your email will get. This is a numbers game, and hyper-personalizing just takes too long. Your time is better spent finding more people to email rather than trying to hyper-target a small handful.

Your entire email should be four crisp, succinct sentences. Anything more than that simply won’t get read by most people. Remember again that this is a numbers game.

4. Have a single, clear “ask” in your email.

Remember that the point of the email is to start a conversation. You’re trying to validate a market need, and learn more information. Don’t ask multiple questions or be ambiguous – get to the point with a single “ask,” which is the single thing you’re trying to get from the email. If you want to talk to the person (almost always the goal), a question like “Who is the right person in your organization to get on your calendar for a brief 5-minute conversation?” will often get a good response.

5. Do a quick follow-up email to non-responders

Just like in real life, persistence pays off. A quick follow-up message a week later to people who didn’t respond often gets a good yield. You’re sending the message that (1) you’re really interested in this problem; (2) you’re not going away if they just ignore you.

I know some sales people who actually start with the follow-up message. They create the template for the main/original message, stick it at the bottom of an email and make it appear like they sent it a week earlier, and “reply” to their “message” with the follow-up! They’ve found this more effective at generating responses than the original email. And the recipients will just assume they deleted the phantom first email or forgot about they received it.

Okay, but how do I actually do all this?

The above is relatively simple, but you still need (1) a list of email addresses; (2) a way to mail merge and send the emails.

There are some great services like Hiplead that will do all of this for you, at a price. (This is geared towards sales teams.)

But at a small scale, you can be a scrappy entrepreneur and do it manually yourself without cost. You can use Linkedin or industry websites to identify your targets. You can then use email-format.com to figure out the company’s email address format. You can also hire workers via oDesk to do the grunt work for you, once you’ve figured out the process for yourself.

You can do the mail merging manually via Google Drive, or you can pay a service like ToutApp $30/mo. to do this for you (they provide useful analytics too).

You will then want to set up a spreadsheet to track your results, so you can figure out which subject lines and message bodies are most effective.

And then, of course, you need to prepare for the phone calls that will follow, remembering that your job is to ASK QUESTIONS and to LISTEN, not to sell. You cannot sell anything until you really understand the details of your target’s business and the specifics of their problem.

All of this takes a lot of time, and a lot of effort, but can produce excellent results at a very low cost.

My latest article in GigaOM

16 Sep

It’s been quite the week on the Kosher Bacon Blog

First, my article, “5 Things That Don’t Make You An Entrepreneur (and 5 Things That Do)” was picked up by StartupDigest, and subsequently received an incredible number of page views, retweets and mentions as a result.  I’m very grateful for all the support and feedback the article received.

Next, a different article I wrote was just published by one of the top tech publications, GigaOM.  The article, “Enterprises find some valuable (and kinda awesome) uses for employees’ smartphones” lays out part of our vision for Zenput and enterprise mobility generally.

Our goal with the article isn’t so much to generate business directly (although that’s always a nice side-effect), but rather to start a conversation in an area of tech that’s ready to explode in growth.  Hopefully we can develop some thought leadership in the space. I’ll probably write more about this strategy in the future, why we think it’s necessary/useful, and its results.  But for now, please read the article and let me know your thoughts!

5 Things That Don’t Make You An Entrepreneur (and 5 Things That Do)

9 Sep

Powerpoint presentations and fancy domains won’t get you anywhere.  Talking to customers/users will.

I was invited to speak on a panel at Stanford’s Graduate School of Business two weeks ago, and was amazed by how many “entrepreneurs” came up to me afterwards (most of whom weren’t GSB students).   This reminded me of a past experience.

About three years ago, I had an idea for a startup called Gimme It. It was roughly along the lines of Pinterest, but not as good.  I bought gimmeit.com, and did a whole bunch of things that made me think I was an “entrepreneur.”  I got close to being a real entrepreneur with this idea.  But in reality, that’s all it ever was – an idea. There’s a huge difference between an idea and creating an actual business.

Having subsequently been the co-founder of one real startup, and now as the second employee of another, I have some ideas about the difference between being an entrepreneur and just pretending to be one.

5 Things That Don’t Make You An Entrepreneur

1.  Putting together a PowerPoint presentation.

The thinking goes like this:  “If I put my idea down in visual form, and sketch everything out, people will be so blown away by the enormity and brilliance of my insight that investors will write me blank checks, Facebook engineers will become my co-founders, and a gigantic snowball of momentum will pick up speed and take my startup to $1bn in revenue in no time!”  I should know – I used to think like this, and I produced a glorious deck for GimmeIt.

Nope.  Doesn’t work like that.  PowerPoint is just a representation of an idea.   If you want to start a cookie business, you wouldn’t go to meetings without some samples of your baking.  And if you want to create your first online business, no-one will take you seriously unless you’ve built something they can actually use.   If you’re not resourceful enough to find a way to build a barebones minimally viable product, who is going to write you a check, sign up for your service, or join your team?

You can waste a ton of time making a beautiful presentation that doesn’t solve a real problem, no-one will pay for, and won’t get you any closer to VC checks.  Yes, you will need a deck at some point, but while you have an idea and nothing more, you are just spinning your wheels.  PowerPoint may be good for fleshing out your ideas, but so are pieces of paper and a pencil.  And with paper and a pencil you will waste a lot less time making completely irrelevant things look pretty.

2.  Buying an amazing domain

Yup, I did this one too.  I was convinced that spending money on a fancy domain like gimmeit.com would garner me respect and make me look more legit.  With emails coming from ollie@gimmeit.com, who wouldn’t take me seriously?

Even with a great domain, you’re still a non-trepreneur.  What do PowerPoints and buying domains have in common? Both involve sitting behind a desk, not interacting with anyone.  Until you get out there and start talking to your target audience and getting feedback, you have no idea if you’re solving a real problem or doing anything that anyone actually values.

Once you have users or customers and you’ve figured out what your business is all about, you can then spend a bunch of money on a fancy domain.  But until you have traction, just pick a cheap and arbitrary domain.  Take a color and an animal and stick them together – greensparrow.com is available on GoDaddy and will do just fine for virtually any business.

Zenput, where I work now, used to called Nextpunch.  This was actually the name of an earlier, separate, product of one of our two co-founders.  But we still got paying customers with the name Nextpunch even though the name had nothing to do with our product – people needed a solution to a problem, and if the product worked well, they couldn’t care less about the name.

Meanwhile, though, Gimme It is no closer to fruition, and I’m still trying to sell a fancy domain that has no business behind it.

3.  Meeting expensive lawyers for free

If I had a penny for every non-trepreneur who told me “we’ve met with [Wilson Sonsini/Gunderson/Orrick/your regional big tech law firm] and they’re going to do all our incorporation documents free and introduce us to investors,” I’d have enough pennies to buy all the rotting carcasses of startup ideas that never became real businesses.

At some point you will need to incorporate and will need all your corporate ducks in a row.  But you don’t need a fancy firm to do it for you, and most likely those introductions to mythical VCs will never happen.  Those lawyers’ reputations are on the line every time they make an introduction, and if they set up VCs (their real paying clients) with every non-trepreneur touting the next “Facebook-killer”, they’d be out of business.

It’s a great sales pitch, but the reality is there are tonnes of cheap or free resources for your incorporation documents, when you need them.  Speaking of which…

4.  Incorporating unnecessarily early in some wacky state

Some people want to feel “safe” and so they rush out to incorporate.  To me, the basic rule is: don’t incorporate until there’s a good reason to. There’s just no point doing it while you’re still a non-trepreneur, and if you’re not really ready, you risk making a big mistake (e.g. not filing your 83b election in time).

When do you need to incorporate? Generally if (1) you get a real co-founder or employees; (2) you get real customers; (3) you’re creating some real IP (not just a website); or (4) you start incurring liabilities (i.e. you have to sign real contracts (not NDAs) or you need a company bank account because money is actually flowing into the company).

Honestly, you’ll know when it’s time to incorporate, and you can do it pretty quickly.

And here’s a mini-rant on the choice of corporate entity and location.  For 99% of companies, there is ONLY ONE QUESTION you need to ask when it comes to incorporating: is it likely my business will ever take institutional investment (i.e. a big VC round)?  If no, incorporate as an LLC (or an S-Corp) in your own state.  If yes, incorporate as a Delaware corporation.  End of story.  Do not get all creative and find some exotic state to incorporate in.  There is no point and you will regret it later.

5. Saying you’re an “entrepreneur” or using the word “stealth”

If you tell people you are an entrepreneur, you’re actually not an entrepreneur. Why? Because real entrepreneurs say what they are actually doing, because they are actually doing something.  If you can’t tell people what exactly it is you’re doing, you’re a non-trepreneur.

And let’s get something else out of the way.  “Stealth” is for airplanes and cats, not startups.  Sure, there are some exceptions, but your idea is likely not one of them.  If your idea is that easily replicable by [Facebook/Amazon/Google], then it’s probably not a business but a product feature.

And even if it is a real idea, there is some serious egocentrism and insecurity to “stealth” thinking, because you have to believe that the investor/customer/friend you’re talking to would (1) think your idea is better than everything they’re currently doing; (2) drop everything they’re currently doing to pursue your idea; and, (3) do a better job than you.  If that’s how you think, you’re not cut out for it.  You shouldn’t walk into a potential competitors office and hand them your idea, but that’s different telling people in your network that your idea is too stealth to share with them.  They are much more likely to help you than steal from you.

Things That Do Make You An Entrepreneur

1.  Talking to customers before you have a product

This is surprisingly counterintuitive to a lot of folks.  But why would you build a product if no-one actually wants to use it?  And you won’t find out without asking.  If you’re afraid to walk into a store, or to track down your target customer on LinkedIn and call them, you’ll never be an entrepreneur.

In fact, there’s a real advantage to talking to customers before you have a product – you’re not trying to sell them anything.  So they’ll give you honest answers and useful feedback, and they won’t feel like you’re pressuring them.  You’re just trying to find out information.

One of the reasons I joined my current company, is because they already had name-brand, paying customers even though the product was (at the time) very undifferentiated from its competitors.  How did that happen?  Our co-founder Vladik would get on the phone, repeatedly, and asked people what they needed.  I want to video Vladik one day, because he literally runs a clinic in how to talk to customers.  He just asks questions, and keeps digging into their business, figuring out why they do things the way they do now and what problems they have.  He keeps asking until he understands their business better than they do.  I’m deadly serious.  And that’s how we won household names as customers with a product that (at-the-time) was fairly barebones.  He never “sold” Zenput – he just demonstrated to the customer that he really understood their business.

If that sounds difficult – it is.  But talking to customers is the only way to understand whether you’re solving a real problem, and whether anyone would actually pay you to use it.  There is literally no point building something that no-one needs.  So ask them – “would you pay for…?”

If it’s a consumer-facing product, spend $100-$200 on Google AdWords or Facebook Ads, just to see if someone will even click on the concept, with a launching soon page at the other end to capture people’s email addresses.  Or, figure out how you would acquire customers for your finished product (if it’s not through ads), and try doing that with a launching soon page at the end.  If no-one bites, that’s a good sign you’re not yet onto something.

2.  Talking to investors

This can be intimidating and feel risky, but can also be priceless.  If you don’t have any investors in your network, you could also just try experienced business professionals.

But, as with customers, the point is this: at the beginning, you want feedback, not money.  You want honest, unvarnished truth, you don’t want to hear “great idea!”  And investors will cut straight to the core and identify your biggest challenges immediately.  Which is what you want.

If you can’t handle being told your idea has problems, you are definitely not an entrepreneur.  You are also horribly unrealistic.  Whether it’s technical challenges, user acquisition issues, regulatory problems, or competition, you are going to face some huge obstacles.  And you need to accept what they are and start figuring out a plan of attack now.  And those problems are not (1) your choice of domain; (2) your choice of website font; (3) whether your first post-IPO car will be a Tesla or Ferrari.

3.  Talking to people who have done similar things

You can’t do this all by yourself.  And you don’t have the experience anyway.  You will need to stand on your own two feet, but there are many things that people can tell you to avoid you re-inventing the wheel.  Even though your core business idea is original or a departure from what’s come before, for everything peripheral, you basically want to follow the pack.  There are some rivers where you’ll have no choice but to go upstream, but for many many things, you’ll just want to go with the flow.  (Sorry for all the mixing of metaphors).

And the best way to do that is to reach out to folks who have done similar things.  Started their own businesses in similar industries, or managed products in the same field.  People love to talk about what they do, and if you reach out to them in a no-pressure, no-expectations kind of way, they will often open right up to you.

It’s probably too early to have formal advisers, but just find a mentor or two who you can meet for lunch every month.  These people will have resources and contacts, and you have to start the ball rolling somewhere.

4.  Building something

So with Gimme It, I actually did numbers 1-3.  I talked to some large retailers (who would have been my target customers and who were pretty enthusiastic), talked to advisors, and set up meetings with investors.   But I never got around to building it.  I was less polished than the other business folks who were courting San Francisco technical co-founders.   And honestly I got intimidated and overwhelmed at the prospect of bootstrapping it on oDesk or paying someone around here.   At the time, I didn’t have what it took to do something like that.

But without a product, even a super barebones one, there was no business, just a PowerPoint, just an idea.  I wasn’t really an entrepreneur yet.

5.  Failing

Failing is an inherent part of entrepreneurship.  Failing is good, as long as you fail fast.  Your goal as an entrepreneur is to figure out as quickly as possible whether something is working or not working.   If it’s not working, figure out why, and fix it or move on.

There are lots of cheesy quotes on this subject, but the one I like the best is “the more you fail, the closer you are to your goal.”  Every time you fail, you’ve eliminated one incorrect course of action.  As long as you are objective and learn from your failures, failing quickly and often is good for your startup, and more importantly, for you.

So what’s the take-home from this? Don’t hide behind a computer. Get out and talk to people. Talk to them before you think you’re ready. Ask questions. Figure out why people are doing things their current way. Ask them how likely they would be to do things in a different way. Once you’ve listened, and listened hard, then you can start to figure out what to build.

Building Powerpoint decks is easy. Building something people will actually use is really hard. And that’s what makes an entrepreneur.

Own your weaknesses like John Oliver and Mark Pincus

11 Jun

Dealing with problems candidly is the most effective communications strategy.

Don't bury your head in sand - no ostrich defense

I presented to a packed room of entrepreneurs and others from the startup community at FUSE last week, and one topic that really resonated was the idea of owning your weaknesses.  This is part of the honesty in communications concept that I have written about frequently.

My basic pitch was as follows:

  • Identify your business’ weaknesses/problems as objectively as possible
  • Acknowledge and address them

It’s a natural human instinct to want to ignore difficulties and hope they go away.  But investors, clients, and the media smell weakness a mile off.  It’s much better to tackle the problems head on and take control of the conversation rather than letting somebody else do it.

I’ve written about the PR disasters that happen when companies don’t talk honestly, but recently I saw two very different but great examples of companies expertly handling difficult situations by owning the problems and dealing with them honestly. 

The Daily Show in “Proper English”

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Comedy Central had several choices in deciding how to deal with Jon Stewart’s three month hiatus from the Daily Show this summer to produce a movie.  Stewart is being replaced by John Oliver, one of his sidekicks on the show.

Alternative 1Say nothing (aka burying head in sand).  As we know, that’s a weak strategy, as you allow the media to take control of the story and take whatever angle they want.

Alternative 2 –  John Oliver is great.  A different tack would just be to say how brilliant John Oliver is, without really addressing that John Stewart has been pivotal to the Daily Show for the last 14 years.  This would be a pretty obvious, but still ineffective strategy.

Alternative 3 – Acknowledge the Elephant in the Room. Talk about how great John Oliver is, but also say upfront that he’s not John Stewart.  Or better still, get John Oliver to say that John Oliver is no John Stewart.

And that third strategy is, of course, exactly what the Daily Show has done to brilliant effect.  They’ve put John Oliver on the road to do the media circuit and generated a ton of positive publicity, with Oliver saying things like:

Don’t worry, it’s still going to be everything you love about The Daily Show, just without the thing you love the most about it.

This is honest and authentic, and also hits the exact tone of the show.  I wouldn’t be surprised if the Daily Show gets a ratings bump with people curious to see how he performs.  Of course, an effective communications strategy only gets people in the door, John Oliver’s product itself will need to be consistently excellent to maintain the positive momentum.

Zynga’s Layoffs

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One of my first articles was about the horrifically bad job Yahoo did with its memo announcing the news that its employees could no longer telecommute.  The policy itself was probably a good one, but Yahoo did not want to piss off sufficient employees to leak the memo, making Yahoo  the focal point of a national debate on this issue.  It is difficult enough recruiting good engineers without the national headlines.  Other tech companies literally have recruiting billboards that use Yahoo’s PR mess against them.

So I was impressed when Zynga (no stranger to PR messes itself) took the right tone with the scary news it was laying off 18% of its workforce.  CEO Mark Pincus made public the company memo announcing the layoffs.  You should read the full memo here, but it was impressively honest.   The first paragraph basically said “it really sucks to lay off this many of our ‘brothers and sisters,’ and it affects everyone at the company.”  The second paragraph then explained the reason – the transition of social gaming away from computers to mobile happened much quicker than Zynga expected and they simply weren’t positioned properly.

Because they owned the news and dealt with it really honestly and sincerely, the story was basically done within one news cycle.  Zynga is a company many love to hate, and there were many bad places this could have gone (“company only cared about making its pre-IPO investors rich”, “is social gaming dead?”, “is Zynga dead?”, “another black eye for Zynga’s CEO”).  But by taking control of the conversation and being so upfront and sincere with the reasons for the layoffs, they killed the story almost before it began.

It’s amazing how difficult it can feel to talk honestly about problems.  But identifying them and addressing them straight on is consistently the ticket to an effective communications strategy. 

Come hear me speak next week in Lincoln, Nebraska (June 6)

31 May

I’m very happy to have been invited by the good folks at The Big Plate and FUSE to speak about effective communications strategies for startups.

Effective Communications Presentation

The key details are:

Location: FUSE,  800 P Street, Lincoln NE 68508

Time: 9:00 am.

Presentation title: Why Don’t Investors and Clients Get How Awesome My Product Is?  Effective Pitching and Communications Strategies for Startups.

Feel free to come by! I will try to post my presentation here after the event.

 

 

The SF Chronicle Doesn’t Understand Why It’s the Problem

17 May

newspapers complaining about congress

News media whipped up a huge furore several weeks ago about the sequester causing flight delays because of Congress’ automatic spending cuts.  As a result of this uproar, Congress almost immediately passed legislation allowing the FAA to operate at prior spending levels.  Many legislators and members of the media then became upset about the quick fix when programs as important as Head Start, cancer research, and housing subsidies for the poor remained harshly cut.

But who’s really to blame?  Sometimes, a picture like the above tells a thousand words.  The San Francisco Chronicle last week told the heart-wrenching story of a 69-year old woman who now can’t afford her rent due to the sequester’s effect on federally subsidized housing.  She now “rarely goes out because she can barely spare money to see a movie” and is an example of the “the poorest Californians . . . whose political voices aren’t as powerful as a frequent flier’s.”

This was an important story.  Where did the Chronicle place the story in its print edition? In a tiny box on the bottom of the front page.  What was the more important story that went above the fold?  A British yachtsman who died on the Bay during an America’s Cup training race.

In other words, the Chronicle placed the story about the (albeit tragic) death of a guy voluntarily participating in a rich person’s sport above the suffering of millions of poorer Americans whose “political voices aren’t as powerful as a frequent flier’s” nor, presumably, yachtsman.

For those who believe the media is the fourth estate, and has any sort of social responsibility, this is frustrating to say the least.  The fact that the same media kicked up such a frenzy about “two-hour flight delays” in the first place reveals an incredible short-sightedness and lack of perspective.

Unconsciously and unintentionally, but very revealingly, this little anecdote tells much about how editors and publishers think, and who they think they are appealing to.  One effective form of strategic communications is to present information as a simple choice between two thing; to create a dichotomy and let people make a choice.  To me this demonstrates the relative importance the media has elected between separate segments of society.  Granted, viewers play a role in this, but for those who believe that the news media should be Fourth Estate, and that it has any sort of social responsibility, the question is how far have they strayed from that role.

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