Business Book Summaries

Bionomics: The Inevitability of Capitalism by Michael Rothschild

"Capitalism, or the market economy, or the free-enterprise system – whatever you choose to label it – was not planned. Like life on earth, it did not need to be. Capitalism just happened, and it will keep on happening. Quite spontaneously. Capitalism flourishes whenever it is not supressed, because it is a naturally occurring phenomenon. It is the way human society organizes itself for survival in a world of limited resources.

A capitalist economy can best be comprehended as a living ecosystem. Key phenomena observed in nature – competition, specialization, cooperation, exploitation, learning, growth, and several others – are also central to business life. Moreover, the evolution of the global ecosystem and the emergence of modern industrial society are studded with striking parallels.

Briefly stated, information is the essence of both systems. In the biologic environment, genetic information, recorded in the DNA molecule, is the basis of all life. In the economic environment, technological information, captured in books, blueprints, scientific journals, databases, and the know-how of millions of individuals, is the ultimate source of all economic life. " (p.xi)

Drawing an extensive analogy between biology and economics, Rothschild argues that capitalism is the natural state for an economic system. This is so because the most profound parallel between biology and economics is that they are both systems for organizing and retaining knowledge: genetic information in the case of biology, and 'production, distribution and consumption knowledge' in the case of economics. The economy is a learning system, and evolves according to certain rules that are remarkably similar to those that would apply to a species or ecosystem. Like an ecosystem, the economy is self-organizing, and requires no central direction or control. Just as the genetic code stores the data that governs the growth, development and reproduction of a species, so too do the compilation of records, processes, plans, etc. that are the information-storage mechanisms for a company or industry perform the same function for the economy.

Rothschild discusses the concept of the 'learning' or 'experience curve' in some depth. This, he maintains, is a fundamental concept largely ignored by traditional economic theory (which is obsessed with mathematical models of stationary equilibrium, and thus ignores the dynamics of the real world). The application of the experience curve is the analogue to the evolutionary process in the natural world, in that this is what allows products and services to be offered increasingly at lower real cost, and ever more finely attuned to the needs of the marketplace. (And, just like the concept of the 'survival of the fittest' in evolutionary theory, it is those products and services that better meet a need and at a lower price, that will be the ones that survive in the marketplace.)

Alternative economic systems (such as Marxism) that flout this 'natural law of economics' will prove to be untenable in the long term (note that this book was written on the brink of the collapse of the Soviet Union).

Some basic policy directions that are implied by the 'bionomics approach':

Taxes should be levied on consumption, not investment: Rothschild contends that, when all the 'politically adroit camouflage' is stripped away, the U.S. federal tax system is based primarily on the taxation of household savings, and not on the taxation of household consumption. The 'bionomics' question therefore is: does consumption or saving make one better off? (p. 144) Rothschild maintains that it is savings (that are in turn invested) that contribute to the growth and development of an economy, by allowing new enterprises that meet market needs (business organisms that are able to exploit a market niche) to flourish. The taxation of savings stifles this economic growth and development, and is akin to robbing the source of energy that keeps an ecosystem going (like cutting back the amount of sunlight that reaches a particular environment would reduce the number of species that would be able to thrive, although Rothschild doesn't use that example).

Corpocracy and bureaucracy are parasitic developments that sap the vitality of a business organism: Corpocracies (the senior group of executives within a company that ignores the interests of the shareholders in favor of their own personal gain) and bureaucracies (the equivalent in the public sector) are like parasites feeding on the energy of a system, but not contributing to the vitality of that system. In extreme cases, such parasitic behavior can 'kill the host' – again not a good thing from a business perspective. Rothschild argues that both corpocracies and bureaucracies should be limited.

Poverty can be reduced by making educational opportunities available equally to all: His analysis in this area is somewhat more convoluted, and is as follows:

€ differences in income in America stem largely from differences in wages (only the top 10% derive any significant income from investments)

€ wages are not simply payment for raw labor – they reflect workers' investment in human capital (i.e. themselves)

€ "without a stream of future income paying dividends on that educational investment, most people would not bother to acquire advanced skills" (p.240)

€ on average, even as a person invests more years in education, the percentage return stays about the same (several studies have shown that this is about 15%)

€ thus, paradoxically, income redistribution schemes (progressive taxes, transfer payments, etc.) make dollar income streams more equal by making the percentage returns on investment in human capital less equal

€ in an increasingly technological society that depends upon an investment in human capital, this amounts to stupid policy

€ as an alternative, relative penalties should not be imposed on the investment in education; rather, educational opportunities should be made accessible to all, and any disincentive to investments in education removed

The underlying approach to bionomics is to find the economic incentives to encourage socially desirable behaviors (reducing poverty, eliminating homelessness, environmental responsibility, etc.) and then letting the self-organizing free market determine the ways in which the business ecosystem will encourage those behaviors. This approach tends to favor incentives and pricing mechanisms over rules and regulations (which require large bureaucracies to administer, and are thus not ultimately an efficient organization mechanism – see the previous discussion item on 'parasitism').

Technorati tags: book summaries, business books, business productivity, self improvement, capitalism, Bionomics, Michael Rothschild

Today's business is all about relationships. Business networking is a critical strategy and tactic to build those critical business relationships. In observing business owners, executives and sales people at numerous networking events and coaching many of these same individuals, I have recognized 7 consistent networking mistakes. If you avoid these 7 mistakes, you should quickly build your business in the New Year.

Mistake #1 – No plan, no goals

Without a networking plan, you waste your valuable resources of time, energy and money. Your networking activities should be aligned to the marketing plan and specific goals within your strategic plan.

Mistake #2 – Poorly constructed elevator speech

The first 7 words that you speak when meeting a potential client, AKA as a prospect, may be the only chance you have with that individual. Your elevator speech should be a series of sentences that are linked together with each sentence "elevating" your story.

Mistake #3 – Too busy telling

As an old mentor said "If you are telling, you ain't selling." The primary goal of the networking event is to make a friend, not to make a sale.

Mistake #4 – No tracking

Attending networking event after event without tracking the results, again wastes limited resources. Contacts, appointments and eventual sales from each networking opportunity should be tracked to determine sales to close ratio as well as client acquisition costs. This is especially true is you belong to a specific business networking group.

Mistake #5 – Talking to "Knowns"

Networking event presents opportunities to cold call in a warmer environment. Since many sales people hate cold calling, they end up talking to "known" friends instead of finding "unknowns."

Mistake #6 – Poor etiquette

Not understanding how or when to join a group of individuals talking with each other is a continual etiquette problem. Additional poor etiquette includes handshakes, introductions and even table manners.

Mistake #7 – Not being present

Many times networking attendees believe the goal is to collect as many business cards as possible. In their haste to meet that next prospect, they are not present with the current prospect. This does achieve the goal of making a friend.

By avoiding these 7 business networking mistakes, you may be able to enhance your networking activities and reap even greater rewards in the New Year.

About Author: Leanne Hoagland-Smith, M.S. is a business coach who specializes in strategic planning with offices near Chicago, IL and in Indianapolis, IN. She writes, speaks and coaches businesses along with individuals to quickly double results through the creation of an executable strategic plan and the necessary skills to pull it off. Technorati tags: book summaries, business books, business productivity, self improvement, networking, marketing

In the Internet Marketing there are many tools that you can use in order to build your business or increase your income, you can find lot of software, books, videos, but you have to know how to use them. Before you begin to use them you need to have clear many things, but there is a tool maybe you don't know well, and it is the most powerful tool that we all have, it is the mind. Nothing can compete with your mind then you have to use it well. With your mind you'll be able to control everything. Did you know that Yoga experts can stop the beats of the heart or to have a surgery without anesthesia? Maybe someone doesn't believe it but it is true and in Internet Marketing is the same, If you are using your mind in the right way you'll get good results and you'll have a high percent to be successful. In order to achieve your goals you need to be concentrated and have a clear vision of all the way you'll have to travel. You have to create the conditions for a good concentration removing all marginal distractions possible and ignoring others. It's important to prepare a long term plan and divide it into levels and each level into a step by step process. Once you get level one you go to level two and so on. In all this system your mind plays a fundamental role because there is not software able to build your system, you are the only one that can build it, because you know what you want and where you want to go and this is the point, your mind is your guide it controls the whole process and it's stronger than any other tool you can have. The essential thing is to maintain an attitude of mental activity, and to avoid anything that will reduce this and make you passive. Thinking and applying systematically will help you to grow, you'll discover the power of your mind. Train your mind. Don't be afraid to make a mistake. Remember nobody learns from the mistakes of the others, you have to try and believe in you. Such fears should be put at rest. You only have to think, think and think and in this way you'll learn how to act and how to do everything right. It's obvious that you'll have to face some problems traveling for your road, then your mind will come to help you and you'll find the solution in a short period of time. A powerful mind accomplishes results in the shortest time and with least waste motion. In order to be successful in Internet Marketing you have to focus your niche and to pay close attention to it. Ask yourself, what am I looking for? Keep it in the background of your mind and search for the answer. Knowing everything about you and about what you want, will help you to develop your business. Keep your mind free, keep a sharp lookout, at every point, to see that you build into the foundation only those materials and that workmanship which will support a masterly structure. Everyone has difficulty in the concentration of attention, workers in business and industry, students and even professors, complain of the same difficulty. Attention seems in some way to be at the very core of mental activity.Therefore paying attention to your niche and working only in this direction is crucial. Using your mind as a tool is the most effective factor to be successful. This is a "Shareware" Article (what's that? read on…) This article is shareware. Give this article away for free on your site, or include it as part of any paid package as long as the entire article is leftintact including this notice. This is a "Shareware" Article (what's that? read on…) This article is shareware. Give this article away for free on your site, or include it as part of any paid package as long as the entire article is left intact including this notice.

About The Author: P.V. Reymond is a marketer that built his business alone. He was growing inside the crowd, studying and learning how big marketers treat their customers, and how customers want to be treated. He came out from the crowd to teach people the whole process in how to build a profitable Internet Business with his Free Internet Marketing Education. If you are not making money online or you want to increase your income, then you should visit his site http://www.pvreymond.com

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Harness the Future ­ The Nine Keys to Emerging Consumer Behaviour by Shirley Roberts

This book is yet another in a series of analyses of various trends and how they will impact on business. Roberts is the founder of a Canadian company called Market-Driven Solutions Inc., which specializes in strategy and business planning for consumer goods and services companies. Prior to starting her own consulting firm, she had fifteen years of experience in the packaged goods industry.

Her framework for analysis identifies nine areas of influence in consumer behaviour: five of which she calls 'leading drivers' (as they are factors which shape consumer reactions) and four of which she calls 'responsive drivers' (as they are influences by the ways in which individuals and businesses respond to the leading drivers. She calls this approach econographics:

"Consumer spending accounts for 66 per cent of the gross domestic product (GDP) in Canada and the United States, so it is no surprise that it significantly affects the economy, governments, educational institutions, the workforce, the retail sector, consumer-based manufacturers and service providers, and the financial services and investment community. Finding a way to anticipate consumer buying behaviour would be invaluable to both the private and public sectors, given the profound effect consumers have. Econographics is a predictive model that can help business people anticipate future consumer demand. It monitors how the world is changing and is likely to change in the future, and predicts how consumer behaviour will be altered as a result." (p.15)

She likens econographics to econometric forecasting, in that there are various leading and lagging variables that together combine to produce economic behavior. In her approach, the equation is:

Leading Drivers plus Responsive Drivers equals Consumer Behaviour As opposed to a quantitative analysis, though, as would be the case with an econometric model, her approach is qualitative in nature. It essentially acts as a checklist of factors (trends) that can stimulate thought and discussion.

She identifies a 'trend' as a "consistent pattern which will likely be in effect for five or ten years or more, whereas a fad will play itself out in a much shorter time, as little as one to two years or less". (p.28) Once identified, trends can then be 'leveraged', meaning that a company can think of ways to capitalize upon them.

The trends themselves (there are 38 of them discussed in the book, spread out among the 9 areas) she has identified through extensive research, monitoring a variety of publications and events across a wide spectrum of society. The table below summarizes the nine key drivers:

Leading Drivers

1) Economy

Trend #1 ­ The gap will widen between winners and losers. Trend #2 ­ The economy will grow and inflation will remain dormant.

Trend #3 ­ Standardized work will decline.

Trend #4 ­ Female influence will increase.

Trend #5 ­ Workers will become more educated. 2) Technology

Trend #1 ­ The microprocessor and humans will form an inseparable bond. Trend #2 ­ Digital networks will drive disintermediation.

Trend #3 ­ Technological change will shorten product life cycles.

Trend #4 ­ Technologies will converge.

Trend #5 ­ Wireless technology advances will increase access to information.

3) Globalization

Trend #1 ­ Expansion of trade will open up new markets. Trend #2 ­ Global market forces will intensify competition.

Trend #3 ­ Stronger market forces will create a far more connected world. 4) Government

Trend #1 ­ The role of government will shift from parental protector to country navigator. Trend #2 ­ Global competition will force governments to sacrifice social spending.

Trend #3 ­ Globalization and technology will make tax revenues harder to collect. 5) Environment

Trend #1 ­ Environmental abuse will remain a serious problem. Trend #2 ­ Environmentalism will become a way of life. Response Drivers 6) Demographics

Trend #1 ­ Ethnic and regional diversity will grow. Trend #2 ­ Family structures will be more diverse.

Trend #3 ­ the population is ageing.

Trend #4 ­ Life-cycle stages, lifestyles and attitudes will be less influenced by chronological age. 7) Consumer Psyche

Trend #1 ­ Spirituality and human reconnection will be sought. Trend #2 ­ A higher quality of life will be pursued.

Trend #3 ­ The desire for new experiences and innovation will grow.

Trend #4 – Shoppers will become more impatient and demanding.

Trend #5 ­ Consumer vigilance for value will grow. Wellness

Trend #1 ­ Medical science will continue to improve the quality and length of lives. Trend #2 ­ The incidence of disease will increase.

Trend #3 ­ Complementary and alternative medicines will become more popular.

Trend #4 ­ Self-health care will flourish.

Trend #5 ­ A healthy lifestyle will become the new miracle drug for longevity and disease prevention. 9) Retailing

Trend #1 ­ Fewer, clearly differentiated retail chains will survive. Trend #2 ­ Local community retailers will grow.

Trend #3 ­ Non-store retail environments will grow.

Trend #4 ­ The lines of competition will continue to blur between types of retailers.

Trend #5 ­ The lines of competition will increasingly blur between retailers and manufacturers.

Trend #6 ­ Technological advances will allow retailing to become truly consumer driven. The bulk of the book is an analysis of each of these trends, using a standard approach: first an analysis of the trend, followed by a discussion of the emerging trend (i.e. where it is expected to go in the immediate future), then a description of how consumers will change in response to the trend, and finally some direction for companies on how to capitalize upon the trend ('Directions for Trend Leveraging'). Generally, the analysis is straightforward and logical, with few surprises. The last chapter in the book, and the Appendix, discuss methods of marketing profitably to tomorrow¹s consumer¹. Roberts identifies nine traits of tomorrow¹s consumer, that will characterize the ways in which they make decisions about products and services. These are:

1. far less homogenous 2. independent thinkers who seek control over their lives

3. more educated and sophisticated

4. pursuers of a higher quality of life

5. extremely demanding

6. optimistic, but well grounded in reality

7. seekers of new experiences and innovation

8. pursuers of wellness and environmentalism

9. ageing, but more active In response to these nine characteristics, she also identifies nine ways in which consumer-oriented companies should be re-organizing themselves in order to ensure they are aligned to these consumer traits. These are:

1. restructure organizations with a consumer-driven focus 2. select and focus on the highest-priority consumer segments

3. develop standardized customization approaches

4. leverage global trends and market intelligence

5. increase the priority on innovation

6. increase the priority on value 7. choose more narrowly targeted and two-way communications vehicles

8. align communications vehicles with the spirit of tomorrow¹s consumers

9. adopt new marketing research approaches to understand tomorrow¹s consumer Navigating the Future presents a straightforward method of reviewing the evolving environment for consumer goods and services, and provides a sound starting point for analysis. While 'econographics' is not likely to become a household word or a standard tool in the business, Roberts¹ approach does make fundamentally good sense.

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They say that Christmas is the most wonderful time of the year. Or so it should be. However, it is also the time of the year when online crime is at it’s highest.

Stay safe online and avoid cyber crime by educating your business and customer with a much information as possible protect their confidential payment details. So what can we do to protect the consumer from crime whilst they enjoy the convenience of online shopping?

Well as a merchant you need to reassure your customers of your commitment to safety and security. The best way to do this is to clearly state this information in your terms. If you have the option reaffirm security in a prominent position on your order form.

You should also include details for customers to check for security when using online forms to order. Explain that the web address begins with ‘https’ and the padlock to the bottom right of your browser will display a locked padlock icon.

These two components show customers that they are in secure online environment and their sensitive data such as address date of birth, credit card numbers will be encrypted using SSL before being transmitted for safe and secure credit card processing.

There are more ways to demonstrate your ongoing commitment to customer privacy and to help build credibility and trust for your business is to become a member of recognized online consumer protection organizations and related security certification sites.

Get involved and apply direct to find out how to become eligible for membership so that your business can enroll and have the authority to display the seal. Visitors to your site can click through to verify that your site and business has been reviewed and approved into the program.

The Better Business Bureau Program

Show your customers that your business adheres to ethical codes of practice and build their confidence as a result of enrolling in the program to display the seal at your site

TRUSTe

Show your commitment to protecting the privacy of customers by providing a clear privacy statement through TRUSTe.

International Council of Online Professionals

A small business organization committed to protecting consumers online. Members agree to adhere to the highest standards of business ethics.

Hacker Safe

Get your site certified as hacker safe through this organization.

A credit card processing seal such as the ‘Versign Secured Seal’ verifies the web site address and business name as listed on their official records.

All of these organization work to reassure consumers that their members work to make maintain the privacy and security of consumers at whilst shopping at their site.

It is essential to build trust, loyalty and credibility to welcome visitors and provide the safe environment for them to shop online.

The above ideas are a step in the right direction towards protecting the consumer online. Stay safe online and avoid cyber crime by educating your business and customer with a much information as possible protect them while they shop safely online.

About Author: Nancy P Redford shows you how ANYONE can accept credit cards online and offline with 3rd party processing companies. Plus stay safe of online scams. Sign up for her free newsletter at: http://www.miriadz.com

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The End of Work – The Decline of the Global Labor Force and the Dawn of the Post-Market Era by Jeremy Rifkin

Rifkin maintains that we are now in the throes of a 'third industrial revolution', which has been going on since the end of World War II. The 'first industrial revolution' occurred in the late 18th and early 19th centuries, when steam power first became developed and used extensively, and replaced human labor in mines and factories. Next, the 'second industrial revolution', in the late 19th and first half of the 20th centuries, powered by fossil fuels of coal and oil, replaced human labor at an accelerated pace in the workplace. In both the first and second industrial revolutions, though, the economic niches and opportunities opened up by the new forms of power offset the loss of jobs. However, Rifkin does not see this happening with the 'third industrial revolution' (which he also calls the 'Information Age'):

"In the past, when new technologies have replaced workers in a given sector, new sectors have always emerged to absorb the displaced laborers. Today all three of the traditional sectors of the economy – agriculture, manufacturing and service – are experiencing technological displacement, forcing millions onto the unemployment rolls. The only new sector emerging is the knowledge sector, made up of a small elite of entrepreneurs, scientists, technicians, computer programmers, professional educators and consultants. While this sector is growing, it is not expected to absorb more than a fraction of the hundreds of millions who will be eliminated in the next several decades in the wake of revolutionary advances in the information and communication sciences." (p. xvii)

Toward the end of the book he re-states this thesis:

"The apostles and evangelists of the Information Age entertain few if any doubts about the ultimate success of the experiment at hand. They are convinced that the Third Industrial Revolution will succeed in opening up more job opportunities than it forecloses and that dramatic increases in productivity will be matched by elevated levels of consumer demand and the opening up of new global markets to absorb the flood of new goods and services that will become available. Their faith, and for that matter their entire world view, hinges on the correctness of those two propositions.

The critics, on the other hand, as well as a growing number of people already left at the wayside of the Third Industrial revolution, are beginning to question whether the new jobs are going to come from. In a world where sophisticated information and communications technologies will be able to replace more and more of the global workforce, it is unlikely that more than a fortunate few will be retrained for the relatively scarce high-tech scientific, professional and managerial jobs made available in the emerging knowledge sector….

Then there is the oft-heard argument that new technologies, products and services not yet even imaginable will come along, providing new business opportunities and jobs for millions. Critics, however, point out that any new product lines introduced in the future will probably require far fewer workers to assemble, produce and deliver and thus not add significant numbers to the employment rolls Even if a product with a universal market potential were to emerge today – one similar to radio or television – its production would likely be highly automated and require few on-line workers." (p. 288)

A major problem with this situation according to Rifkin is that under the present system, this lack of employment means in turn that many households will lack the purchasing power to participate fully in society, to buy the goods and services produced by the economy. (In a sense, he notes, this is a reversal of Henry Ford's philosophy of paying his workers a sufficient wage so that they could afford the very cars that they were producing.)

Much of the book is a detailed recitation of facts and figures from around the world, showing how employment in traditionally key sectors – agriculture, manufacturing, and the service sector – is dwindling, and is unlikely to be replaced by new jobs. Ultimately, Rifkin sees no way to stop or reverse the trends of automation and technological development that are creating 'the end of work'. He does, though, present some policy options for governments to consider to ease the transition and to deal with a future situation where there is not enough meaningful work for all. These include:

a shorter work week (he suggests a 30-hour week)

a guaranteed annual income (coupled with a requirement for individuals to work for welfare)

a revised tax system that would allow deductions for time spent in volunteer, charitable and not-for-profit organizations (what Rifkin terms 'shadow wages') This latter option he sees as actually a very attractive one, and suggests that this 'third sector' could emerge as a viable employment alternative for individuals (in addition to the private sector ('the first sector') and government ('the second sector'). This would provide a meaningful occupation to millions, and would (he says) re-connect them with the American tradition of volunteerism and philanthropy (although one must question whether it is true volunteerism in this case, if they are receiving financial compensation in any form).

He ends by underscoring the point that we are at a crossroads, and that our safe transition to another era will depend on our foresight and determination:

"We are entering a new age of global markets and automated production. The road to a near-workerless economy is within sight. Whether that road leads to a safe haven or a terrible abyss will depend on how well civilization prepares for the post-market era that will follow on the heels of the Third Industrial Revolution. The end of work could spell a death sentence for civilization as we have come to know it. The end of work could also signal the beginning of a great social transformation, a rebirth of the human spirit. The future lies in our hands." (pp. 292, 293).

Technorati tags: book summaries, business books, business productivity, self improvement, The End of Work, Jeremy Rifkin

The 22 Immutable Laws of Branding: How to Build a Product or Service into a World-Class Brand by Al Ries and Laura Ries

According to the father-daughter team of Al and Laura Ries, a brand name is a name (a Proper Noun in fact) in the mind of the consumer that conveys a single proposition about a particular product or service. The power in a brand name lies in its ability to positively influence purchasing behavior. In an increasingly cluttered information society, a powerful brand image can act as a guidepost for the consumer in making a purchase decision.

"What is accelerating this trend is the decline of selling. As a profession and as a function, selling is slowly sinking like the Titanic. Today, most products and services are bought, not sold. And branding greatly facilitates this process. Branding "pre-sells" the product or service to the user. Branding is simply an efficient way to sell things." (p.2)

A successful branding program, therefore, should differentiate your product or service from all the similar products or services out there.

"A successful branding program is based on the concept of singularity. It creates in the mind of the prospect the perception that there is no product on the market quite like your product.

Can a successful brand appeal to everybody? No. The same concept of singularity makes certain that no one brand can possibly have a universal appeal." (p.7)

In this book, the authors discuss 'laws' of branding that they have found to hold true across innumerable product and service offerings. Continuing the theme that Ries has championed in previous books (see, for example, The 22 Immutable Laws of Marketing and Focus) they maintain that a major problem for companies is the temptation to extend a successful brand into other, sometimes only peripherally-related, areas. (Two actual examples mentioned in the book are Harley-Davidson wine coolers and Heinz all-purpose cleaning vinegar.) Such brand extensions only serve to confuse the consumer and dilute the single message strength of the core brand.

Their twenty-two 'laws' of branding are:

1. the law of expansion ­ the power of a brand is inversely proportional to its scope "Marketers constantly run branding programs that are in conflict with how people want to perceive their brands. Customers want brands that are narrow in scope and are distinguishable by a single word, the shorter the better." (p. 13)

2. the law of contraction ­ a brand becomes stronger when you narrow its focus

3. the law of publicity ­ the birth of a brand is achieved with publicity, not advertising ­ Ries and Ries maintain that advertising is best used to maintain a brand, but that it is very difficult and expensive to launch a new brand through advertising alone ­ they best way, they say, is to be first in a new product or service category, and reap the attendant publicity

4. the law of advertising ­ once born, a brand needs advertising to stay healthy

5. the law of the word ­ a brand should strive to own a word in the mind of the consumer ­ "If you want to build a brand, you must focus your branding efforts on owning a word in the prospect's mind. A word that nobody else owns." (p.39) Examples they give include: Mercedes = prestige; Volvo = safety; Kleenex = tissue; Xerox = copier; FedEx = overnight.

6. the law of credentials ­ the crucial ingredient in the success of any brand is its claim to authenticityŠ and the best claim to authenticity is being the leading product or service in your category, because consumers assume that if it is a leading seller, it must be good:

"Never forget leadership. No matter how small the market, don't get duped into simply selling the benefits of the category.

There are also the long-term benefits of leadership. Because once you get on top, its hard to lose your spot. A widely-publicized study of twenty-five leading brands in twenty-five different product categories in the year 1923 showed that twenty of the same twenty-five brands are still the leaders in their categories today. In seventy-five years, only five brands lost their leadership." (p.53)

7. the law of quality ­ quality is important, but brands are not built by quality alone ­ In fact, as the authors point out, most people have no idea as to the "real" quality of a product or service. Is a Rolex really better at keeping time than a Timex? How do you know?

8. the law of the category ­ a leading brand should promote the product or service category, not the brand ­ This may seen counter-intuitive, but the authors argue here that the best way for the brand leader to build sales is to promote the category, not their specific brand. This is a more effective way to build up overall market awareness and interest, and the brand leader will naturally benefit to a greater degree than other competitors, by virtue of their larger market share. (And when the overall size of the market is built up, then the leader is in a good position to increase market share still further.)

9. the law of the name ­ in the long run, a brand is nothing more than a name

10. the law of extensions ­ the easiest way to destroy a brand is to put its name on everything

11. the law of fellowship ­ in order to build the category, a brand should welcome other brands ­ see rule #8

12. the law of the generic ­ one of the fastest routes to failure is giving a brand a generic name ­ Generic names (i.e. names that describe the product or service category, such as "Wine Coolerz"), do not strongly position the product or service within the category, and are thus liable to confuse potential customers.

13. the law of the company ­ Brands are brands. Companies are companies. There is a difference.

"The issue of how to use a company name is at the same time both simple and complicated. Simple, because the laws are so clear-cut. Complicated, because most companies do not follow the simple laws of branding and end up with a system that defies logic and results in endless brand versus company debates.

Brand names should almost always take precedence over company names. Consumers buy brands, they don't buy companies. So when a company name is used alone as a brand name (GE, Coca Cola, IBM, Xerox, Intel), customers see these names as brands." (p.106)

14. the law of subbrands ­ what branding builds, subbranding (i.e. brand extensions) can destroy. The name 'Chevrolet' used to stand for something. Now, what is it? A large, small, cheap, expensive car or truck.

15. the law of siblings ­ There is a time and a place to launch a second brand. "The key to a family approach is to make each sibling a unique individual brand with its own identity. Resist the urge to give the brands a family look or identity. You want to make each brand a different and distinct as possible." (p.120)

16. the law of shape ­ A brand's logotype should be designed to fit the eye. Both eyes. The authors argue here that the ideal shape for a logotype or brand symbol is two and a quarter units wide and one unit high.

17. the law of color ­ A brand should use a color that is the opposite of its major competitor's.

18. the law of borders ­ There are no barriers to global branding. A brand should know no borders.

19. the law of consistency ­ A brand is not built overnight. Success is measured in decades, not years.

20. the law of change ­ Brands can be changed, but only infrequently and very carefully.

21. the law of mortality ­ No brand will live forever. Euthanasia is often the best solution.

22. the law of singularity ­ The most important aspect of a brand is its single-mindedness.

The book is a quick read, very much in the tradition of other Ries-influenced offerings. It contains much useful advice, and is written in a entertaining and readable style.

The above summary has been provided to you compliments of TCI Management Consultants

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See if this applies to you or your team members in your organization: You've been working in your industry for several years. Your responses to requests from customers, prospects and co-workers are fast and accurate. You know your stuff and your product knowledge is one of your greatest strengths. If this is the case, then the bad news is that your extensive knowledge may also be one of your greatest weaknesses. The reason – you may be inadvertently coming across as being arrogant and insensitive. I'm not suggesting that you have a holier-than-thou attitude or that you are unfriendly. It's just that you are so quick with your answers and recommendations that others feel like you haven't really been listening to their needs (even though you have). In other words, the greater your expertise, the more likely it is that you are unintentionally rubbing people the wrong way. The good news is that there's an easy way to prevent this misconception that I call The Humility Advantage©. Working with over a hundred sales and service teams over the years, I've found there are at least seven key opportunities where a little employee humility pays-off substantially. Here are three that I often share in my Influence with Ease® speeches and seminars. 1. Mention your Homework Several years ago, a couple of branding consultants approached me about enlisting their services. My first thought was that these folks knew nothing about my company or my industry, so why on earth should I pay their sizable fees. I only agreed to meet with them because a colleague said they'd done good work for his firm. When I sat down with the consultants, they did not start asking me lots of questions about me and my industry. (That would have confirmed to me that they really didn't know my business world and would have ended their chances of selling me their services). Instead, they began the meeting explaining that, by way of preparation, they'd been chatting with some of my colleagues and customers to find out their impressions of my company's services. Then, they asked if I would like to hear the word-on-the-street. As you can imagine, that got my attention. And the ensuing conversation led me to engage their services. When you talk with potential customers, do you begin the conversation by mentioning the homework you've done on their company? If not, you're missing an opportunity to let them know that you are truly interested in them. Rather than starting a sales conversation by asking about their needs, try commenting on something you saw on their website or read about them in an industry journal. It's a powerful way to confirm to others that you're knowledgeable without coming across as one who brags. It's one of the first steps in applying the humility advantage. 2. Confirm your Understanding If you've participated as an audience member in one of my live presentations, you might have seen me step off the stage pretending to be a waiter taking food orders from several audience members as if they're at a restaurant. During this skit, rather than order directly from a menu, each patron has a special request such as, “I'll have the salad with the meal.” or “I'd like to have fruit instead of fries,” etc. As the waiter, I don't write any of this down, and as you've likely guessed, when I walk away, the patrons assume that there is no way I'm going to get all the orders straight. There's the problem. I may have listened accurately to each request, but the emotions I left with my customers are worry and lack of confidence in my service. As an experienced professional in your industry, you may be a great listener, but are you perceived as such? Being regarded as a poor listener is a surefire way to kill a sale or curtail your career. Fortunately, by using a little humility, this is easy to correct. In the waiter demonstration, I redo the same order-taking scenario, except the second time after taking the orders, I say, “Let me make sure I've got this straight. You would like yours with fruit instead of fries…” (I then confirm everyone's special request accurately). Suddenly, the restaurant patrons feel good about the quality of my service. Here's the key; I repeated my understanding of their needs with the phrase, “Let me make sure I've got this straight.” Fact is, I knew I had it straight, but the customer didn't. The catch is, if my ego were running my life I'd never say, “Let me make sure I've got this straight.” Hence the Humility Advantage. Here's one more application: 3. Ask Permission to Present You've probably heard the expression that people don't like to be sold-to, but they love to buy. That means that before you present the benefits of your products or services, remember to ask for permission. When you thread all these techniques together, a sales conversation might start by pointing out the homework you've done on the other person. Then ask about their needs, confirming your understanding with, “Let me make sure I've got this straight…” Later, ask permission to present with, “Based on what you've told me, I do have some thoughts. Would you like to hear a couple of options that I think would fit for you?” Once the other person agrees, they'll feel less like they are being forced, and more like they are being helped. About The Author : This article is based on the critically acclaimed book, Becoming a Service Icon in 90 Minutes a Month, by business strategist and international speaker Jeff Mowatt. To obtain your own copy of his book or to inquire about engaging Jeff for your team, visit http://www.jeffmowatt.com or call 1-800-JMowatt (566-9288). Technorati tags: book summaries, business books, business productivity, self improvement, marketing

Focus ­ The Future of Your Company Depends On It by Al Ries, HarperCollins, New York, 1996

Al Ries, the author (with Jack Trout) of such classics as The 22 Immutable Laws of Marketing and The New Positioning, argues that one of the big problems with companies today is a lack of focus upon a core product or service. According to Ries, many enterprises have got caught in what he calls the 'line extension' or 'diversification' traps in an effort to grow their business. These strategies have failed: in example after example, Ries shows how focused companies make greater profits and have higher share values than unfocused companies.

The line extension trap occurs when a company takes a successful brand positioning for one product or service and tries to extend it to other related (or sometimes unrelated) products or services. The result in this case is confusion in the mind of the consumer, which can be detrimental to the positioning of the product or service. And, as Ries has argued in other books, it is this positioning of the product or service in the mind of the consumer ­ the brand 'owning a word' in the mind of the prospect ­ that is critical to success in market leadership.

"Leaders own their categories…literally. By that I mean that a leader owns the word that defines the category in the mind of the prospect.

Owning a word in the mind is a leader's fundamental strength, more valuable than its offices, its factories, its warehouses, its distribution systems. You can always replace a physical facility that burns down, but you can't easily replace somebody else's word in the prospect¹s mind.

If you're not the leader, you tend to see the problem as trying to produce a better product than the leader. I¹ve worked with many number two, three, and four companies and invariable they see products or services as either better than the leader's product or service or at least comparable to it, but at a lower price.

Yet they seldom make much progress against the leader, and they rarely, if ever, overtake the leader.

It¹s not enough to produce a better product or a cheaper one than the leader offers. It's helpful, but it's not enough. What you must do is develop a corporate strategy that allows you to cope with that powerful position in the mind.

That's what focusing is all about. If someone else "owns the category" your only viable strategy is to narrow your own focus and own a piece of the category." (pp. 100, 101)

The diversification trap occurs when management acquires or develops other businesses that are related to the core product or services, in an effort to 'tap synergies' or 'exploit convergence opportunities'. Here the problem lies in the management of the company becoming concerned with two or more essentially separate business operations, rather than the core business:

"It always happens. The minute management takes its eyes off the core business and starts chasing synergies and secondary opportunities, the company starts to go downhill. It may not be immediately obvious. Problems usually fester for some time before they become obvious." (p.179. 180)

It is possible for companies to develop what Ries calls a 'multistep focus', offering several different product or services to the consumer. This is essentially the strategy that was pursued by Albert Sloan in the early days at GM, or the approach to the market that is currently being taken by Darden Restaurants, the IDG publishing company, and many others. Here the key to success is to establish several different products, each of which has its own separate brand identity, and each of which appeals to a different (and distinct) market segment. Furthermore, each has its own management structure, which is solely focused on the success of that particular brand. The brands may be related to each other in terms of a sales progression in the mind of the consumer (e.g. a car buyer starting with a Chevrolet, then moving up to a Pontiac, then a Buick, Oldsmobile and eventually a Cadillac, as each becomes successively affordable) but each is perceived to have a distinct identity.

In the retail sector, focus is clearly the route to success that has been taken by some of today's retail giants such as Best Buy, Circuit City, Barnes and Noble, Home Depot, Staples (Business Depot in Canada) and many others. Ries analyzes the steps that these operations have taken in becoming retail 'category killers' as follows:

1. narrow the focus 2. stock in depth

3. buy cheap

4. sell cheap

5. dominate the category

Ultimately, what is important to become dominant in the category of business that you are in is to develop a perception of quality in the mind of the consumer. Ries points out that this perception is quite unrelated to the actual quality of the product or service. He identifies four ways in which focus can improve the perception of quality:

1. the specialist effect ­ by positioning your company as doing nothing but making a certain product or providing a certain service, and that all your energies are focused upon doing that to the best of your company¹s ability

2. the leadership effect ­ by being the first company to offer a product or service, or by being the largest company to offer it, conveys the idea that the company is setting the standard and therefore must be the leader in product quality

3. the price effect ­ the highest-priced product in the category is generally perceived to have the highest quality (think of Rolls-Royce or Rolex)

4. the name effect ­ a powerful and evocative name for a product or service can help develop an image of high quality. "Other ways to improve the perception of quality is by changing the "look" of the product, the packaging, and the name. Perhaps the most important aspect of quality is the name itself. It's especially important to use a specialist name rather than a generalist name." "(p.93)

Ries ends the book by presenting fifteen keys to an effective focus; tips and pointers on the notion of focus that should be considered by any company that wants to develop a more effective focus:

what a focus is:

1. a focus is simple

2. a focus is memorable

3. a focus is powerful

4. a focus is revolutionary ­ What Ries has to say here is quite interesting:

"Managers have been taught to aim for growth, to expand their product lines, to get into new areas, to take advantage of synergy. Conventional thinking is totally oriented toward growth. Bigger is better. Growth can do no wrong.

The fact that these expansionist theories don't usually work has not stopped their adoption. If you believe that something should work and it doesn't then the fault lies in the execution, not the theory. It should work, goes the theory, therefore we have to find a way to make it work.

If you believe that growth is good, then you will resist any attempt to focus a corporation. The truth is, focus does restrict growth outside a selected area, much like pruning a plant forces it to grow only in a specific direction. If you want to focus a corporation, you¹re going to have to be prepared to break a few GAMPs.

A GAMP is a Generally Accepted Management Practice. At the heart of GAMP thinking is the demand for growth. Not just growth in sales, but growth in profits, growth in return on investment. When viewed from a growth platform, any attempt to focus a company is considered reactionary. To make an omelette, you have to break a few eggs. To focus a corporation, you have to break a few GAMPs." (p. 275)

5. a focus needs an enemy

6. a focus is the future

7. a focus is internal as much as external

8. a focus is what the country needs – "Countries shouldn't fight the focusing process. Let competition dictate which countries make which products and services. Let's all end trade barriers, which only protect the inefficient producer and do nothing for the customer and, in the long run, nothing for the employee either" (p.283)

what a focus is not:

9. a focus is not a product

10. a focus is not an umbrella

11. a focus does not appeal to everybody

12. a focus is not hard to find

13. a focus is not instantly successful

14. a focus is not a strategy – Ries' complaint here is that a strategy is in most cases, too broad and growth-oriented, giving the company, if anything, a motivation to become unfocused through diversification, acquisition, line extension, etc.

15. a focus is not forever: "Sooner or later, even the most powerful focus becomes obsolete. That's when a company must refocus itself." (p.289)

This is another very thought-provoking book from Al Ries, a short read but a very useful one.

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Today’s consumer marketplace is saturated with products, many of which blend into one another and become lost in the sea of choices offered to consumers. For this reason, it has become necessary for manufacturers to make their products stand out in some way or another, and many are looking to innovations in the packaging world to help them sell their products.

Certain flexible packaging designs such as stand up pouches and unique barrier film combinations used for retort and vacuum pouches may be relative newcomers to the packaging market, but they have had an enormous impact at retail. In fact, the following list is just a small overview of the many benefits flexible packaging can offer you and your business:

1. Flexible packaging is extremely customizable, and can be made to fit whatever demands your product makes. In addition, you can order flexible packaging in any variety of shapes and sizes; you can even have them die-cut into shapes that correspond with your product or brand, making them stand out even more at retail.

2. The use of flexible packaging can extend the shelf life of your product. Typically made from high-grade plastic, aluminum, or a combination of the two, flexible packaging offers additional protection from outside elements, meaning that your product is better protected for longer amounts of time.

3. Today’s retailers want products that can be merchandised creatively, and pouches made with flexible materials offer limitless merchandising opportunities. For example, standup pouches can either stand on a retail shelf, or hang in a peg display, opening the door to new marketing possibilities.

4. Flexible packaging can be made with reusable features, either with press-to-close zip seals, slide zippers, or even spouts for liquids. Because today’s consumer demands convenience, packages that are easy to use and reuse are especially successful at retail.

5. The unique construction of flexible packaging using barrier materials that are strong yet pliable also opens the door to many new graphic design possibilities. Because these materials can be printed using advanced flexographic and rotogravure printing methods, your package can be printed with extremely vibrant colors, and very vivid, clear logos, making your product stand out even more at retail.

6. The sky’s the limit when it comes to size. While most manufacturers employ flexible packages that are relatively small in size, some adventurous marketers have decided to use this medium for extremely large packages that are then sold to wholesale stores like Sam’s Club or Costco. Every type of retailer has something to gain from flexible packaging.

7. Flexible packaging can be designed using gusseted bottoms, which means that the package will expand when the product is placed into it. This is especially useful for manufacturers of liquid products, who need something that expands without compromising the strength of the package.

8. For commodity items like sugar, rice, or coffee, flexible packaging present new and unique opportunities to make their product stand out. No longer confined to boring, traditional paper packages or boxes, flexible packaging opens the door to hundreds of merchandising and marketing possibilities.

9. Flexible packages, when empty, can be stored flat, which means that most of the space in your warehouse that was once used for rigid packages can now be used for something else. The easy-to-store convenience of flexible packaging adheres to many of the guidelines asserted by lean manufacturing principles, a business philosophy that has taken the manufacturing industry by storm in recent years.

10. Using flexible packaging is less wasteful than other packaging methods, such as rigid plastic bottles or bag-in-a-box designs. Since more and more retailers are demanding strict adherence to environmental regulations, and because today’s consumers are extremely conscious of environmental issues, less wasteful packaging is oftentimes much more appealing.

Flexible packaging is just a portion of the overall packaging industry. Yet, at the rate its manufacturers continue to develop unique designs to showcase products and protect them like never before, it is clear that it will continue grow in popularity and quite possibly become the dominant segment in the business.

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