Bottleneck Breakthrough Audiobook - Chapter 2 - The Big Idea | Ep 23

Speaker A

00:00:02.320 - 00:17:17.549

Lever. One Strategy Michael Porter said a company can outperform rivals only if it can establish a difference that it can preserve.

Strategy is one of the most misused words in business today, stripping it of its power and significance for business owners.

Having worked closely with some of the greatest business strategy minds, starting with Dan Kennedy, then Chet Holmes, Jay Abraham and Perry Marshall, I've seen firsthand how the right strategy can unlock tremendous growth. What is strategy though?

It has two applications in my clients businesses and sets the foundation for this section in the Bottleneck Breakthrough Method. First, it's the effort of establishing a difference that can be preserved.

This is commonly referred to as positioning and can also include business models like how you make money.

All activity in the business comes out of this strategy, and it is usually altered only when responding to major changes in the market or when innovation creates a breakthrough. The second definition is the effort of defining and organizing activities to achieve a desired outcome.

This is executional, focusing on achieving a strategic objective that supports the long term goals of the company. It determines which tactics are used and in which order based on the resources, the time, money and staff available.

Every business owner I have met struggles with being overwhelmed by executional strategy. There are just too many options to pursue when trying to grow their company.

When you add the volume of new software promising to make their project management easier, or marketing tools claiming to drive endless leads that are ready to buy, knowing what to pursue and in what order is a chronic need.

Chapter two walks you through developing brilliant positioning by finding your big idea that cuts through the clutter of the marketplace to draw prospects to you. Chapter three shows you how to assess and improve any part of your business, making executional strategy much easier to prioritize.

Chapter 2 the Big Idea Al Ries and Jack Trauss said the basic approach to positioning is not to create something new and different, but to manipulate what's already in the mind to retie the connections that already exist.

A few years ago I heard my friend Perry Marshall interview the marketing director for a company that manufactured very large they're huge 6 foot to 20 foot industrial fans for some very boring applications in warehouses and livestock yards. The company produced a great product, but everything about their business was boring. Even their name was bland. It was HVLS Fan company.

HVLS was the acronym for the type of fans they made, which were high volume, low speed fans. Obviously no farmer is going to get excited about a fan to cool off their dairy cattle after they'd been in business for a few years.

They started catching on when everyone would comment, man, that's a big ass fan.

Upon seeing their fans at a trade show around that time, they brought in Bill the marketing guy, and he immediately demanded that they change their name to Big Ass Fans. Like any change, everyone in the company fought it.

Plus they're based in Lexington, Kentucky, where using foul language was pretty much taboo in the conservative community. Now all change is resisted except by the person that came up with the idea. After a battle of wills, Bill's will and determination eventually won.

So in 2003, the company officially changed their name from HVLS Fan Company to Big Ass Fans. The amount of press and interest that came from it was nothing short of a viral sensation.

Bill was interviewed on every edgy morning radio show across the us Written up in newspapers, and even interviewed by the BBC. Because of the shocking new name, they leveraged the heck out of it and have been growing like gangbusters since.

In just the first four years after the name change, they grew by 400%, making the first Inc 5000 list in 2007, and they've been on it ever since. Unless you've been living under a rock, you would recognize that this growth was sustained through the Great Recession too.

This is a wonderful example of a big idea, which is something that grabs your market's attention and presents a solution in a new and possibly unusual way.

More often than not, big ideas center around your product or service, so don't think you need to change your company name right now just because big ass fans did it successfully. At the end of the day, you want people to remember whatever it is you promised to deliver.

And with big ass fans, you'll never forget it, even though you'll likely never buy one. In fact, I was at the gym recently and I noticed two huge ceiling fans that had a little logo on the center hub.

I'll give you one guess which company it was and the story it instantly reminded me of. Still not convinced?

In case you weren't already aware, every method available to get your message in front of potential prospects is saturated and everyone is suffering from information overload. Have you looked at a magazine or newspaper lately? I would estimate that most are nearing a 5050 split between advertisements and editorial content.

Go online and you can't miss the banner ads, display ads, text ads, pop up ads, sidebar ads, newsfeed ads, and retargeting ads all designed to sell you something. There's just no end in sight to the amount of advertisements jumping out in front of you trying to get your attention.

To combat this barrage on their Attention. Many people have resorted to using tools like ad blockers to reduce the noise so they can actually use a website effectively.

It's a constant battle between the company shouting for attention to get prospects to buy their stuff and the prospects trying to keep from being distracted. Google recently eliminated the right sidebar of ads.

This is the single biggest change to their AdWords platform since it was created in October of 2000. Whole industries were built on those sidebar ads with companies spending well over a million dollars per month on them, and now they have vanished.

Cutting through the noise for your business is more important now than at any time in modern history. In the case of Google Ads, you simply cannot throw more money at it to get noticed.

It has to be of interest to people searching or else Google won't show your ad, regardless of how much you're willing to pay.

I'm sure your product or service is amazing, but if you want to see how unremarkable your positioning is, just Google your tagline or mission statement or headline on your website or latest brochure.

Put quotation marks around the phrase in Google and you'll see the thousands of websites listing the exact same statement for their product or service. This should help you see that you are just part of the undifferentiated white noise in the world.

To potential prospects, this means you will be known only by word of mouth until you unlock a big idea that will differentiate your company, product or service in it takes time.

You may be tempted to blow off developing a big idea just because you have enough fires to put out right now and you're just scavenging for a quick fix to drive some new revenue. That's fair enough. Big ideas are definitely not a quick fix.

A great story of a big idea taking time to develop comes from Jack Canfield, co author of the Chicken Soup for the Book Empire, with his partner Mark Victor Hanson. They had decided to work on the book after having countless people ask them at conferences to publish their inspirational stories.

They compiled the first 101 stories into a manuscript, then visited publishers in New York, only to be turned down by every single one. Eventually, they were introduced to a small publisher in Florida who loved the book. The problem was that they didn't have a name for it.

So Jack and Mark made it their focus, meditating on it every morning and night. Then one night, Jack went to bed with the intention, I will wake up with the perfect book title.

He had a dream in which a hand wrote Chicken Soup for the Soul on a chalkboard. This was in the early 90s before whiteboards took over. So chalkboard was what he saw.

He woke up with the title in his head and the rest, as they say, is history. The book went on to sell over a hundred million copies worldwide.

With that said, if you decide to wait on developing your big idea, I recommend at least finishing this chapter so you can let the concept back process in your subconscious.

Create your big idea the best way to accelerate the process of developing a big idea is by creating what's known as a value curve, making sure that your idea is unlike that of any of your competitors while still meeting customer desires. The process is outlined in the book Blue Ocean Strategy by W. Chan Kim and Renee Mauborn.

As they demonstrate throughout the book, this process can unlock a blue ocean of opportunity and get you out of the bloody red ocean of commoditized competition.

In their book they use a graph like the one on page 25 here in this book to visualize the factors an industry competes on, referring to it as the strategy canvas. With it, they recommend that you not only look at the factors from competitors, but also from alternatives that prospects choose from.

Alternative industries and markets are a consistent source of ways I've found to differentiate for many businesses. One famous example is the innovation of the drive thru for fast food restaurants that's now used millions of times every day.

It was originally invented by Banks in 1928 with their drive up tellers. This ingenious concept wasn't adopted by restaurants until 1947, almost two decades later.

Then it took McDonald's another 28 years until they added it in 1975. Just think of all the additional revenue the fast food industry missed out on by delaying this one feature.

The most important factor to address on the value curve is to uncover the desires of the customers as well as possible non customers. Sometimes the market for converting non customers is easier to get to and possibly larger than the market for existing customers of your competition.

The best strategy of converting non customers in Blue Ocean's strategy is Yellowtail, which is made by Casella Wines. They felt the market of wine drinkers had become saturated, competing on factors that were complex and seemingly arbitrary.

So they looked to the much larger market of beer and cocktail drinkers to see what it would take to convert them to drink their wine.

Looking at their strategy canvas for Yellowtail, you can see the factors the wine industry competed on and the related value curves of premium and budget wines. Instead of trying to go head to head with either end of the market, Casella went through the process.

Kim and Mauborn define as the four Actions Framework which asks the following first, what are the factors in your industry that are taken for granted and should be eliminated? Second, what factors should be reduced well below the industry standard? Third, what factors should be raised well above the industry standard?

And finally fourth, what are new factors that should be created that the industry has never offered?

By looking at the beer and cocktail non customers, they saw the factors of easy drinking, ease of selection and fun and adventure are the priorities and added them to their value curve.

Not only did they convert huge numbers of people in a much larger market, but their market redefinition also reduced the complexity of production or lowering their overhead.

Caselli used all four actions to unlock an uncontested Blue ocean market in the process of creating a new value curve and using the four Actions framework, I've yet to walk away empty handed. It produces at least one differentiator that is worth testing to see how prospects respond to it, and it typically leads to more useful insights.

Lions and Tigers and gymnasts oh my.

There are a number of fantastic case studies outlined in Blue Ocean Strategy, and if you're a reader like me, you'll want to have a copy of the book because it's an invaluable resource that you'll revisit throughout the rest of your entrepreneurial career. My favorite case study in the book was from Cirque du Soleil.

You may not be aware, but Cirque du Soleil's direct competition is actually Ringling Brothers and other three ring circuses. They both featured feats of strength and physical coordination incapable of being performed by mere mortals.

But instead of competing on the distinctive characteristics that Ringling Brothers had established since their founding in 1884, Cirque du Soleil used the Four Actions framework to develop a new value curve that unlocked a new blue ocean in the process. When you look at the business model of the conventional circus, you'll see that they've been in a downward spiral since the late 90s.

Their costs have continued to rise, but increasing ticket prices in order to remain competitive was problematic. Just think of the expense of hauling tigers and elephants across the country.

Plus, they cater to kids, so the tickets have always been family budget friendly. In less than 20 years since the industry decline started, Ringling Brothers finally had to close after 146 years in business.

The first thing you notice about Cirque du Soleil is that they started with the first question of the four Actions framework and eliminated the animals from their show. That's an impressive cut to overhead the stars of the show became the gymnasts who once performed the trapeze, tightrope and other acrobatic feats.

The gymnasts were much easier to source and maintain than tigers, and the last time I checked, the salary for a gymnast is much lower than that of a team. It takes to keep a tiger alive and keep it from eating everyone else. The quality of the venue was then raised to a comfortable theater style setting.

No more bench seats in an arena or under a big tent.

Paired with their creation of themes and artistic direction, this made it more appealing to the non customer who might traditionally attend the philharmonic or sports games to entertain for business. These improvements attracted a higher end client and allowed them to justify a higher ticket price.

With their prices ranging from $60 to $200 and more, Cirque du Soleil has unlocked a business that entrepreneurial dreams are made of Big Idea Fuel youl should be convinced now that a big idea is necessary for real sustainable growth.

You may not need it to get past your current plateau, but you will need it if you want to keep growing for years to come just like big ass fans in Cirque du Soleil. So what should you be doing while you're waiting for your big idea to materialize? Testimonials? They are the fuel to help materialize your big idea.

You'll see the unique factors your clients care about that you can use to hone your value curve and create your big idea just like big ass fans did. Plus, they help all marketing and sales efforts perform better.

Since you've been in business for a while, you have sources for these testimonials just waiting to be written. Begin collecting as many as possible from past endorsements, written reviews, case studies, or actual testimonials from past clients.

A car dealer I know has pictures of every person who has ever bought a car from him. He plastered them all over his cubicle and then started building a binder filled with the pictures.

He would show the pictures to prospects so they could see the multiple generations of families that had purchased cars from him.

The photo album was visual proof of his success leveraging social proof, which is the persuasion mechanism made famous by Professor Robert Cialdini in his book Influence and it relies on humans to look for ways to shorten decision making and assumes that if someone else like them did something then it should be good for them to do it too. And he also makes new customer feel more comfortable since so many others like them had benefited from doing business with him over the years.

If you sell something physical like cars homes or jewelry. Getting photos with customers is a breeze. Simply ask them if you can take their picture to add to your album of happy customers.

If you serve a local area, reviews on sites like Yelp, Google, My Business, and Facebook are powerful because they can show up in Google or when a prospect is searching for you online. Putting photos of your clients on your website is useful too.

Jay Abraham, the godfather of modern business strategy, did this over the past few decades and he ended up with a 400 page book. It is an 8 by 10 book containing the letters of endorsements he had received over the years.

Reviewing it while I was sitting in his office was just another contributing factor in building his credibility, especially in light of the fact that some of the letters are from the titans of industry, like a key executive at FedEx.

Do it for Them the single biggest factor holding you back from getting testimonials is simply how difficult it is for your clients to write something worthwhile. It's not because they don't love working with you, it's just that they don't always know what to say.

Here are my favorite methods to solve this problem. The first and most tactful approach is to offer to write the testimonial for them.

When it is completed, you can email or mail it to them for a final edit. Every time I've done this, my clients have thanked me for it.

So since they weren't sure how to go about writing it and I saved them some valuable time, you might also write several optional testimonials as examples for your customers. A friend of mine is a real estate broker whose team works with buyers, sellers and investors.

He has several template endorsements for each of those three segments that he sends as an email at the end of escrow with some links to his Trulia, Zillow, Google, My Business, Facebook and Yelp profiles. His clients get the hint and appreciate the time saving templates and and their testimonials strengthen his profiles.

Finally, another method I have used is to interview my clients, recording them with their permission and using their answers to craft the testimonial for them to approve.

When I owned a mortgage brokerage, we created a testimonial CD that was a compilation of the best endorsements about our services and included it in our welcome package to Prospects Action Steps if you don't have a big idea yet, do the following. First, draw out your value curve, evaluate what your competitors value curves might be too and put them on the strategy canvas to compare against.

I suggest a whiteboard or online at BBG Li strategy canvas. Second, add the value curve in an alternative solution like beer and cocktail drinkers for Yellowtail.

Third look at the competing factors and go through the four Actions framework to find what to eliminate, reduce, raise and create. Finally fourth, work with your team to start developing your big idea into a clearly defined sentence.

You may have to go through this a few times until it hits the bullseye. If you don't have a robust testimonials library, start collecting them now. First pick 10 happy clients to ask to give testimonials.

Even if only two or three give you one, they will provide a big boost to your sales and marketing efforts. Next, interview the happy clients if you want to get powerful insights that will help drive your big idea development.

Third save the testimonial in a Google Doc or somewhere easy for everyone on your team to reference. Finally fourth for extra credit, get pictures and videos with each testimonial. Phones are great to capture these when you're with clients.