What Is Your What? What is the one thing you were born to do? Steve Olsher, who has built several successful businesses, and who now helps other entrepreneurs succeed, visited my show to share his insights on how to answer this essential question. Below are some of the highlights of…
By Katie Paine I promise I’m not going to talk about social media’s impact on the election. That’s been hashed over to death in the media, and you can read all about it here, here, and here. However, I will talk about the impact of the volume and speed with which social media invaded our society […]
By Fard Johnmar As the Trump Administration begins to take shape, many are asking what the new U.S. government will mean for digital innovation in health—an area that has flourished over the past eight years of the Obama presidency. If the Affordable Care Act (ACA) is repealed (as appears likely), consumers, patients, insurers and others […]
Nissan recently gave the wildly popular YouTube star UnBox Therapy the opportunity to check out the 2017 Nissan Rogue One Star Wars Limited Edition, this model just happens to be 1/5400. The video appeared on his channel just a couple days ago and in typical UnBox Therapy fashion it was done in an unboxing fashion just on a much grander scale.
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MBAs are taught that a business is worth the sum of its future profits. This benchmark is how investors calculate the fair price of a company’s shares.
CEOs and their management teams are evaluated by their ability to increase the value of their stocks—and therefore care deeply about the ability of their companies to generate free cash flow. Management’s job, in the eyes of shareholders, is to implement strategies to grow future profits by increasing revenues or decreasing expenses.
Fostering consumer habits is an effective way to increase the value of a company by driving higher customer lifetime value (CLTV): the amount of money made from a customer before that person switches to a competitor, stops using the product, or dies. User habits increase how long and how frequently customers use a product, resulting in higher CLTV.
Some products have a very high CLTV. For example, credit card customers tend to stay loyal for a very long time and are worth a bundle. Hence, credit card companies are willing to spend a considerable amount of money acquiring new customers. This explains why consumers receive so many promotional offers, ranging from free gifts to airline bonus miles, to entice them to add another card or upgrade the current one. Potential CLTV justifies a credit card company’s marketing investment.
Habits Supercharge Growth
Users who continuously find value in a product are more likely to tell their friends about it. Frequent usage creates more opportunities to encourage people to invite their friends, broadcast content, and share through word of mouth. Hooked users become brand evangelists—megaphones for your company, bringing in new users at little or no cost.
Products with higher user engagement also have the potential to grow faster than their rivals. Case in point: Facebook leapfrogged its competitors, including MySpace and Friendster, even though it was relatively late to the social networking party. Although its competitors both had healthy growth rates and millions of users by the time Mark Zuckerberg’s fledgling site launched beyond the closed doors of academia, his company came to dominate the industry.
Facebook’s success was, in part, a result of what I call the more is more principle—more frequent usage drives more viral growth. As David Skok, tech entrepreneur turned venture capitalist, points out, “The most important factor to increasing growth is . . . Viral Cycle Time.” Viral Cycle Time is the amount of time it takes a user to invite another user, and it can have a massive impact. “For example, after 20 days with a cycle time of two days, you will have 20,470 users,” Skok writes. “But if you halved that cycle time to one day, you would have over 20 million users! It is logical that it would be better to have more cycles occur, but it is less obvious just how much better.”
Having a greater proportion of users daily returning to a service dramatically decreases Viral Cycle Time for two reasons: First, daily users initiate loops more often (think tagging a friend in a Facebook photo); second, more daily active users means more people to respond and react to each invitation. The cycle not only perpetuates the process—with higher and higher user engagement, it accelerates it.
User habits are a competitive advantage. Products that change customer routines are less susceptible to attacks from other companies.
Habits: A Friend Or A Foe
Many entrepreneurs fall into the trap of building products that are only marginally better than existing solutions, hoping their innovation will be good enough to woo customers away from existing products. But when it comes to shaking consumers’ old habits, these naive entrepreneurs often find that better products don’t always win—especially if a large number of users have already adopted a competing product.
A classic paper by John Gourville, a professor of marketing at Harvard Business School, stipulates that “many innovations fail because consumers irrationally overvalue the old while companies irrationally overvalue the new.”
Gourville claims that for new entrants to stand a chance, they can’t just be better, they must be nine times better. Why such a high bar? Because old habits die hard and new products or services need to offer dramatic improvements to shake users out of old routines. Gourville writes that products that require a high degree of behavior change are doomed to fail even if the benefits of using the new product are clear and substantial.
For example, the technology I am using to write this piece is inferior to existing alternatives in many ways. I’m referring to the QWERTY keyboard which was first developed in the 1870s for the now-ancient typewriter. QWERTY was designed with commonly used characters spaced far apart. This layout prevented typists from jamming the metal type bars of early machines. This physical limitation is an anachronism in the digital age, yet QWERTY keyboards remain the standard despite the invention of far better layouts. Professor August Dvorak’s keyboard design, for example, placed vowels in the center row, increasing typing speed and accuracy. Though patented in 1932, the Dvorak Simplified Keyboard was written off.
QWERTY survives due to the high costs of changing user behavior. When first introduced to the keyboard, we use the hunt-and-peck method. After months of practice, we instinctively learn to activate all our fingers in response to our thoughts with little-to-no conscious effort, and the words begin to grow effortlessly from mind to screen. But switching to an unfamiliar keyboard—even if more efficient—would force us to relearn how to type.
Users also increase their dependency on habit-forming products by storing value in them—further reducing the likelihood of switching to an alternative. For example, every e-mail sent and received using Google’s Gmail is stored indefinitely, providing users with a lasting repository of past conversations. New followers on Twitter increase users’ clout and amplify their ability to transmit messages to their communities. Memories and experiences captured on Instagram are added to one’s digital scrapbook. Switching to a new e-mail service, social network, or photo-sharing app becomes more difficult the more people use them. The nontransferable value created and stored inside these services discourages users from leaving.
Ultimately, user habits increase a business’s return on investment. Higher customer lifetime value, greater pricing flexibility, supercharged growth, and a sharpened competitive edge together equal a more powerful bang for the company’s buck.
More on habits…
Contributed to Branding Strategy Insider by Nir Eyal. Excerpted from his book Hooked: How to Build Habit-Forming Products
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This blog was written by Ilaria Maselli, Brian Schaitkin, and Klaas de Vries. Asked whether they agree or not with a set of changes to the Constitution, 65 percent of Italians (almost 33 million voters) showed up to answer on Sunday December 4. The response was a loud no: 59.1 percent of the votes. How […]
This year, SS+K is breaking free of the traditional flat holiday card stack by offering 360° virtual reality bobsled rides. A few folds will turn the 2D card into 3D VR glasses for the recipient to take take their seat in the bobsled. After sliding through banked turns, jumps, an upside-down loop and more jumps, the bobsledder will bash through a bank of snow at the finish line where they are greeted by cheering polar creatures that they’ve encountered along the way.
The virtual world consists of beautifully simple 3D polygonal assets that make up a colorful winter wonderland. With the cardboard glasses, users will be able to engage a slow-motion effect at any point throughout the experience to get a better look at the playful world around them. At any point throughout the run, snow will fall if the user shakes their head.
You can start the experience with any VR headset by going to https://www.ssk.com/holiday/ on your phone. No VR glasses? There’s also a 360-degree YouTube video of the experience, video above. (Hint: If you watch the video on an Android phone, you can explore the world as you would with a VR headset.)
CREATIVE CREDITS:
Agency: SS+K
Partner, Chief Creative Officer – Bobby Hershfield
Creative Director – Armando Flores
Copywriter – Ryan Hrbek
Design Director – Jesse Raker
Designers – Chris Peck, Don Vincent Ortega
SVP, Director of Client Services – Elisa Silva
SVP, Director of Production + Innovation – John Swartz
Producer – Andrew Veith
SVP, Digital Strategy & Innovation – Kevin Skobac
Production companies
VR development: TANTRUM Lab
Website development: Firefall Pro
CTO: Scott Park
Project Manager: Stephen Lutchman
Developer – Aric Ng
Developer – Tyrone Shine
Developer – Gena Hayward
Developer – Stephen Tetreault
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When I started to connect with top influencers in online marketing, millionaire entrepreneurs, New York Times bestselling authors and renowned media personalities, my life and my business were transformed. First… I changed my own beliefs about what was possible for me. I realized that if I followed the same steps…
If you’re looking for a “job,” Apple doesn’t want you. Apple prefers to hire people who hear a “calling” to apply.
Apple hires people who want to play a role in creating the best-loved technology on the planet. Apple hires people who take joy in helping others discover tools they can use to change the way they live, work, and play. Apple hires enthusiastic people who want to help others achieve their dreams. It’s a philosophy Steve Jobs instilled in the culture. Andy Hertzfeld, an original member of the Apple team and now an engineer at Google, once said that what Jobs taught him was to “follow your heart” and only great work comes out of doing what you adore. Hertzfeld was walking with Jobs near his home in Palo Alto, California. It was around the time the Internet bubble was minting millionaires all around them and those who weren’t rich yet were talking about “exit strategies” – selling quickly for a profit. “It’s such a small ambition and sad, really,” Jobs said. “They should want to build something, something that lasts.”
Apple creates a customer service culture that lasts because it hires for personality. The company cannot train for personality. No company can. The filtering process begins at the Apple website, which specifically states the company is only looking for people who want to change the world and who want to positively impact the lives of others: “Like when someone creates their first video with iMovie. Surfs the Internet-the real Internet-on an iPhone. Or uses the built-in iSight camera to video chat with their grandchildren. Making it all happen can be hard work. And you could probably find an easier job someplace else. But that’s not the point, is it?”
On the tenth anniversary of the Apple Store, the company created a poster that was circulated among its employees. It was meant to inspire employees and capture the spirit of the company. But if you read the poster carefully, it reveals much of the magic behind the brand and provides lessons for any company attempting to create a next-generation customer experience.
“At the very center of all we’ve accomplished are our people,” the poster states.
“People who understand how important art is to technology. People who match, and often exceed, the excitement of our customers on days we release new products. The more than 30,000 smart, dedicated employees who work so hard to create lasting relationships with the millions who walk through our doors … we now see that it’s our job to train our people and to learn from them. And we recruit employees with such different back grounds – teachers, musicians, artists, engineers – that there’s a lot they can teach us. We’ve learned how to value a magnetic personality just as much as proficiency. How to look for intelligence but give just as much weight to kindness. How to find people who want a career, not a job. And we’ve learned that when we hire the right people, we can lead rather than manage. We can give each person their own piece of the garden to transform.”
Contributed to Branding Strategy Insider by Carmine Gallo in partnership with McGraw-Hill. Excerpted from The Apple Experience: Secrets to Building Insanley Great Customer Loyalty
The Blake Project Can Help: Please email us for more about our brand culture expertise.
Branding Strategy Insider is a service of The Blake Project: A strategic brand consultancy specializing in Brand Research, Brand Strategy, Brand Licensing and Brand Education
FREE Publications And Resources For Marketers
*reSET is the only Connecticut organization to receive the U.S. Small Business Administration for the Growth Accelerator Competition Award, announced by President Obama on August 4th, 2015.
Katie Pirquet’s comment: Victoria, BC in Canada has long enjoyed a resurrected rail bed known as the “Galloping Goose Trail”, named after a noisy, gasoline-fired locomotive that plied its routes long ago. The trail extends from an abandoned gold rush town (Leechtown), 10km from Sooke, BC, some 30km to downtown Victoria, with a branch that wanders about the same distance up the Saanich Peninsula to the town of Sidney. Check it out on Google Maps. It is heavily used by commuters on bikes, walkers, hikers, and joggers. The Trail is accessible to everyone, with safe crossings at many roadways and no big hills. Many sections are paved, others maintained with packed gravel and/or chips. It passes through a few parks on its way, giving access to them, too. The Galloping Goose Trail has become an important feature of the Vancouver Island outdoor-loving lifestyle, and will remain so even if the corridors one day become shared with some form of light transit. Vancouver Islanders love to get “out there”, rain or shine, and the GGT is one of our favourite amenities!