The terminology Poundstone uses seems roughly analogous to that employed by other businesses in portfolio planning, the BCG Growth-Share Matrix.

From the New York article:

Puzzles, anchors, stars, and plowhorses; those are a few of the terms consultants now use when assembling a menu (which is as much an advertisement as anything else). “A star is a popular, high-profit item-in other words, an item for which customers are willing to pay a good deal more than it costs to make,” Poundstone explains. “A puzzle is high-profit but unpopular; a plowhorse is the opposite, popular yet unprofitable. Consultants try to turn puzzles into stars, nudge customers away from plowhorses, and convince everyone that the prices on the menu are more reasonable than they look.”

Instead of puzzles, anchors, stars, and plowhorses charted based on popularity and profit margin, the BCG matrix uses stars, cash cows, dogs, and question marks organized by market growth rate and relative market share. So, the tools are similar in their mechanism but analyze slightly different marketing situations.

While a cash cow sounds like an expensive filet mignon, I can see why Poundstone wouldn’t want to label any restaurant dish with “dog”. These are both simple but powerful tools that can be used in strategic planning exercises to illuminate options for improving future profitability.

Another indispensible but deliciously simple strategy tool? SWOT.

Via Tyler Cowen’s Ethnic Dining Guide via Marginal Revolution via New York Magazine.

Wright Brand bacon and its sexy new packaging

Wright and Interbrand have done their part in advancing bacon branding from an art into a science, as they finished a recent multi-stage, two-year bacon marketing project. You have to read some of the impressive marketing-speak stuffed in this press release:

… reposition Wright Brand so it could … become more emotionally relevant to consumers.

Emotionally relevant bacon? I guess that’s not implausible. I do occasionally turn to bacon for comfort when I’ve had a bad day.

… recommended brand position of “More of what you love about bacon”

Bacon is what I love about bacon. Are you selling free bacon?

… the strategic foundation for the updated brand mark and packaging system …

A plastic bag is now referred to as a “packaging system”?

… rooted in understanding and delighting the target market of bacon enthusiasts who love bacon …

I now have another item to add to my list of hobbies on my Facebook profile: “bacon enthusiast.”

via Package Design eSolutions #61, May 29, 2009.

Plastic reshaping wine trade — latimes.com.

Plus, they have some awesome new artwork for their 75 Minute IPA bottle label:

Dogfish Head 75 Minute IPA label

It's all a big social media circle

It all started when I decided to apply for the position of Founder’s Associate at Twitter. Rather than a standard cover letter, I submitted a strategic analysis outlining Twitter’s current competitive state and its options to win the microblogging battle and larger social communications war. The primary tools used were scenario planning and Porter’s 5 Forces.

I then presented this analysis in a session at BarCampSD (San Diego) on November 12, 2008 to an audience with great interaction and sharing of thoughts.

Fast forward to the present. I have been a bit off the grid the last couple weeks while traveling home for Thanksgiving and working on the family business. So, just yesterday I read the news that Facebook had, so far, unsuccessfully negotiated an acquisition of Twitter.

About time. Their partnership was my first recommendation in the strategy presentation.

In my mind, at least an attempt by Facebook to acquire Twitter was inevitable for these fundamental reasons:

It’s a mutually beneficial relationship

Twitter gets a business model, as tweets are displayed amongst advertisements in users’ feeds.

Facebook buys Twitter’s large, existing userbase and brand recognition rather than battling Twitter head-on with a modified status feature.

They need each other

Twitter has, by far, the largest userbase of all microblogging services. But yet its size pales in comparison to the number of people using Facebook. It’s hard to imagine another way Twitter could scale its userbase so quickly.

Facebook is missing out on all the conversations that occur outside its walls on Twitter. It would be beneficial for Facebook user frequency and volume to have Twitter conversations integrated with profiles, the Facebook platform, and the rest of the user’s social graph.

I called this scenario “Slap in the Facebook World”, describing a situation where Twitter must either partner with Facebook or watch as Facebook builds a Twitter clone and leverages its size to bully Twitter out of the ring.

Other scenarios included in the presentation:

• “Twitter in the Cloud Behind the Curtain” — Twitter as a service provider, with revenue coming from premium API access
• “Microblogging the Microsoft Way” — The microblogging platform with the largest corporate userbase wins the consumer game
• “Open Sesame” — Open standards and open source win (e.g. Laconica) and no company makes significant revenues directly from the product

If you’d like to check out the strategy presentation, I’ve embedded it below.

Disclaimer: I made this presentation quickly and for the purpose of sharing indirectly, not for delivering a speech. Therefore, I don’t advise following my example in such text-heavy slides and lack of graphics. You will put your audience to sleep!

As the New York Times addresses in the recent article “Rivals’ Visions Differ on Unleashing Innovation”, the financial crisis is diverting attention in the upcoming election from the candidates’ science and innovation policies to their approaches for fixing the economy today. Since the media suffers from attention deficit disorder and can only devote coverage to one issue at a time, I’ll use my blog to reach the masses (mini-masses?) and share the importance of innovation to the US’s future.

First, I’ll simplify the process of national innovation to the highest degree possible. Check out this 1st-grade-math graphic I created:

Innovation Math

Let’s break this equation down.

For the US to remain an innovation leader, the country needs money to be spent on research and development combined with talented people to do the work and discover breakthroughs.

Show me the money

Where’s the money come from? It is a combination of government and corporate research investment. If you’d like to compare the Presidential candidates on their technology investment policies, read here. Both candidates support making the federal R&D tax credits permanent, which is important for encouraging corporate investment. But Obama supports significantly more government investment than McCain, and I think Obama has it right. One example: Obama supports the investment of $150 billion over 10 years in developing clean technology.

Many groundbreaking technological advances were achieved on the back of government investment in space, defense, and university basic research — fields like computing and the Internet, medicine and nanotechnology, and transportation technology like RADAR. (Note to avoid angry emails: I didn’t say the government invented the computer, just that its investment advanced the progress.) When there is no clear connection between the basic scientific research and a commercialization opportunity with positive R&D ROI, the government is needed to provide the initial investment. The government then receives its ROI when companies later commercialize the progress in research, create jobs, and pay taxes.

The argument for just how the government should manage this investment in innovation is complicated, so I won’t attempt to solve that problem in this post. However, you can hear some interesting perspectives in this podcast from the journal Nature regarding the upcoming election and national innovation policy. Here are couple takeaways to pique your interest:

• Idea to create a new National Innovation Foundation to holistically manage innovation strategy for the US
• Countries like Taiwan, Japan, China, UK, Germany, and Singapore have national innovation strategies, but the US does not
• Over the past 8 years, the number of computer science graduates in the US has declined by 50%

It’s the people, stupid

Now, let’s move on to the people side of the equation. This is why I really wanted to write this post.

All that money won’t do any good if it isn’t paying and funding the research of talented, educated workers. Undoubtedly, you’ve heard by now horrific statistics, like “China is producing 10 times more engineers than the USA.” While numbers like this might be a stretch — read this article from BusinessWeek about the apples and oranges comparison — there is no doubt that global competitiveness is higher than ever before.

We need to get serious about changing the status quo and take real action to influence youth culture and increase the attractiveness of careers in science and technology. If we want to strengthen national innovation, why don’t we first get innovative with science advocacy? According to the above podcast, there are hundreds of programs across K-12 education advocating science, but let’s face it:

Children and teens are not the most receptive to ideas of what is cool and important coming from the classroom.

Children and teens learn what is popular and desirable from their social relationships with their peers.

These programs aren’t effective enough yet because the marketing is wrong. Let’s look at this problem as a business case study and see if we can find some insight that educators are missing.

(I wrote previously about the importance of science education and strategies for making science interesting in this post. Here, I’ll take a different approach to a similar problem.)

You’re the CEO of a company — let’s call it SciTechSchool Co. — and your business model is this: for every student you encourage to be passionate about science and technology and graduate with a related degree, your company makes $100,000. Woah! What a business opportunity!

(I don’t know what the government’s marginal benefit is for each additional scientist or engineer, but it’s reasonable, if not conservative, to think these people might pay an additional $100k in taxes over their lifetimes.)

Hm… How do you show kids that science is interesting? Do you offer after-school programs to teach them more about science after they’ve had a full day at school already? No, that obviously won’t work.

Maybe, instead of trying to push science at school, you look for ways to slip science into kids’ everyday lives? How do you make science a part of youth social fabric? You make small alterations to what kids are already doing, and without them even recognizing it, they’ll be using science regularly.

Let’s use video games as an example, because we know they garner a lot of youth attention. Say Halo is the game of choice. Want to encourage electrical engineering? Players must fix the virtual wiring in their weapons and suit after being hit before they will work again. Chemical engineering? Players collect chemical components throughout the game and then mix them in precise amounts for regenerative medicine. Mechanical engineering? Players must design their own protective gear and truck armor, balancing strength and weight for the best performance. Computer engineering? Players must program booby traps to capture the enemy, like a knockout gas that is discharged when a sensor detects an intruder.

Video games often involve problem solving by design, all your company needs to do is alter these problems a bit towards science. And this is just one example, the same principle could be applied to other youth pastimes, as well. How about a simple programming language on a mobile phone or a bicycle built for modifications and upgrades?

Let’s change the way we think about science education. If business won’t provide the toys, gear, games, and websites kids need to be science-minded naturally, then let’s create an agency to evaluate and designate “SciTech” products. Then, companies can advertise the benefit to parents, and we let them claim additional tax credits for the development of these products.

It’s due time we get innovative about keeping this country innovative.

I was doing some research recently into GPS solutions for flying as my father is training for his sport pilot license in pursuit of piloting his new powered parachute. Surfing around Garmin’s site, I was surprised to see the lack of support it provides for making a shopping decision. It’s not easy to pick the right device — in the automotive category alone, there are at least 31 different GPS devices from which to choose.

Although not unique in its lapse, I believe this sort of marketing shortcoming is entirely inexcusable. The most advanced shopping feature is a side-by-side comparison tool. How about a product advisor that asks questions about how I’m going to use my GPS or what features are important and then recommends the best options?

Want to navigate me to the best one?

I understand that Garmin does not retail its own products, but that shouldn’t keep it from helping me select the perfect product from its lineup at Garmin.com so I can go buy it at a nearby electronics store.

After all, who should be more helpful and knowledgeable regarding a product line than the company who designs and builds it? No doubt everyone in their marketing department could help me pick the right product if I met them over a beer at a local bar. But they can’t help me on their own company website?

This is a missed pre-sales opportunity, without a doubt. If I get to this site, I am already interested in Garmin’s products. Garmin needs to seize this opportunity and make sure that I find the right product from its lineup. Scaring me with a massive grid of options is as likely to send me clicking to a competitor as it is to present the best choice.

Keep the shopping simple. Don’t miss an opportunity to educate the customer on why they should by your product. 3 is better than 30 when it comes to encouraging the customer to make a decision and purchase.

The Internet as been creating many opportunities for small companies (including sole proprietors) to act bigger than they could afford in the offline world, and the branding world is no exception.

My client is a successful, talented, and established artist. He is looking for help in differentiating himself from the abundant competition going forward. Considering his openness to innovation and taking a unique path from typical artists, I believe his biggest opportunities for differentiation are not in the content of a future painting but in establishing himself as a brand that encompasses his artwork and extends far beyond it.

This presentation will focus on leveraging the power of the Internet to create a brand with much further reach than could be achieved by an individual offline.

Please feel free to borrow what is useful (as I’ve borrowed from others to create this) and leave any comments if you think I’ve left something out.

I’m particularly looking for some strong examples of small businesses or individuals who’ve created a well-known brand online — ideally outside of the tech industry, to prove that you don’t have to work in tech to use technology to your brand advantage.

OUTLINE

• Why do I need to build a brand?
  • What is the Internet’s role in branding?
  • How does this brand extend into the real world?
• Why build a dialogue and a community?
  • How do I build a dialogue and a community online?
  • How does this extend into the real world?

IN PROGRESS

• What are examples of (personal) brands built online?
• What are examples of dialogues and communities built online?
• What is my brand?

PRESENTATION NOTES

Why do I need to build a brand?

• People do not connect to products or services.
  • They connect to the brand accompanying a product or service.
• Consumers have too many choices — a brand provides differentiation
• Perceived value beyond the basic commodity level is carried in the brand
• The brand is the expectation or promise of value
• A strong brand reduces the need to compete on price alone
• A strong brand gives employees focus and a sense of purpose in their work

What is the Internet’s role in branding?

• It’s easy to be visible on the Internet
  • You are able to publish up-to-date information whenever you want
  • The information is available to anyone with Internet access around the world
• Information on the Internet is largely persistent
  • Once it is created, it exists “forever”
  • A piece of information only has to be published once for it to be communicated continuously
  • Example
    • In the analog world, a story about the inspiration for a print must be told individually to each customer, or broadcast in a newsletter
      • After its initially delivered, its power to impact additional customers falls off quickly
    • In the digital world, the same story is published once but lives onward, easily being forwarded to others, referenced in links, and arrising in search results
      • A larger audience can be reached and in serendipitous ways
• People increasingly look to the Internet first to learn about a company before making a purchase or to answer a question
  • Your website will be the first impression for many potential customers — what do you want it to say about you?
• Digital information is easy to share with others
  • Nothing builds a brand more intimately or effectively than a recommendation from a trusted friend or family member
• Your Internet branding machine is working while you are sleeping
  • You can take a vacation half way around the world to New Zealand, but your brand can still be growing as, for example, a blog post you wrote sparks discussion on a much-debated topic
• The Internet can bring your products to life in a way that is not possible on paper or through words
  • Videos, slideshows, and capturing navigation add interest and depth to information
• Most popular tools for online branding
  • Blogs, online videos (YouTube), social networks (Facebook), websites, email newsletters

How does online branding work offline?

• All content created for online publication can be repurposed for printing or presentations
  • Offer to be a presenter at banquets, art shows, fundraisers, conservation group meetings — anywhere you can share knowledge and be seen by potential customers
  • A blog post forces you to think through an experience, event, activity, or piece of knowledge and put it into words
  • This composed, thoughtful perspective is then prepared next time the topic comes up at a banquet, art show, dinner, or interview
• Writings can be distributed in print magazines and newspapers or with purchases

Why build a dialogue and a community?

• Fans, customers, friends, and colleagues are an important marketing vehicle for your brand
  • What they say about you is crucial to the shaping and publicizing of your brand
• Communicating with people in a dialogue rather than talking at them engages and compells them
  • These people are much more likely to share your brand with their family and friends

How do I build a dialogue and a community online?

• Be yourself
• Be compelling to your audience, open, authentic, consistent, transparent, and well-known
  • People forgive mistakes and differences in opinion when the speaker is sincere and honest
• Share and talk about your own passions
  • The topic won’t have impact if it’s something you don’t love
• Be a teacher
  • Share with people from your unique knowledge and experiences
  • If you give away something of value, the receiver feels valued
• Ask questions
  • To learn what customers want
  • To learn from others’ experiences
• Use your influence
  • Use your name, publicity, and network to reach out and help others
• Be open to contact
  • Publish an email address and answer all emails within 24 hours
• Share a common cause with the community
  • Chances are you share a common passion outside of your business connection with your customers
    • Examples: conservation, environmentalism, green living
  • Designate a place for these people to meet and share ideas and experiences
    • Social network, blog
  • Make it easy for the community to share what they’re doing with their friends and spread the brand

How do I take online dialogue and community offline?

• Meet in-person with customers beyond purchasing decisions
  • Have important, engaged customers visit the studio and see Larry at work
    • They will more than make up for the time required with their recommendations to new customers
  • Talk about more than the artwork when giving presentations
    • What do you care about?
    • People will see who you are as a whole person (your personal brand), not just a painting-creator

What are examples of personal brands?

• Gary Vaynerchuk
  • Took a wine store and made it undeniably unique in personality
  • He does not try to appeal to everyone — that would only water down his brand and his uniqueness
    • He is himself and people appreciate it
  • He gives a face and a personality to what is otherwise an impersonal experience — buying wine online
  • He does all he can to engage with his fans
    • Answers all emails
    • Encourages people to write
• Looking for more great examples! (Particularly outside of the tech industry)

What are examples of dialogues and communities built online?

In progress

What is my brand?

Will work through this exercise with the client

Some sources at which you might take a peak:

The Brand Gap

First Impressions, Marketing, Brand, and Participants