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——————————————————————————————————- Learn How to Use Pain to Drive Innovation ——————————————————————————————————- The Pain Papers ——————————————————————————————————- SHARE THE WEALTH. FORWARD THIS NEWSLETTER. Any other unauthorized publication, excerpting, or duplication of the contents without the permission of Christopher K. O'Leary is a violation of copyright law. For past issues of The Pain Papers, see... To subscribe to The Pain Papers, please send a message
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——————————————————————————————————- EMERGIT.COM INTERVIEW I was recently interviewed by emergit.com for an article called "A Pain in the Market". The subject of the article is how to use pain to sell products and services. A number of other authors were also interviewed. I talk about my ideas at some length. Here's the link for those of you who want to read the article... https://www.emergit.com/html/content_cur/profiles/11-19-2001_pain.jsp ——————————————————————————————————- TO WHOM DO YOU LISTEN? One of the things that has struck me during the course of my research for the book, and that has steeled my resolve to finish it, is the fact that NONE of the entrepreneurs that I have studied (and the number is upward of 200) used ANY of the techniques that are sold by the current crop of creativity gurus. While they could be said to have gone outside of the box, none set out to do so or talked about that. Instead, they were motivated by things like pain and doing things better. The question thus becomes "To whom do you listen?" Do you listen to the "gurus" or do you listen to the entrepreneurs? One big point of the book is that you should listen to the words and actions of the entrepreneurs. ——————————————————————————————————- CREDENTIALISM I was in my neighborhood Borders the other day and came across a book on the shelf. What caught my eye wasn't the title of the book. It was the line beneath the author's name... "A writer for the Wall Street Journal." When I look at the cover of a book, I am used seeing... "The editor of The Wall Street Journal" or "The author of _____" or "The CEO of _____" ...beneath the name of the author. The phrase... "A writer for the Wall Street Journal." ...has to be the most banal set of credentials that I have ever seen. However, it does point out the power that even the weakest of credentials can have in swaying someone's opinion. This power results from the fact that credentials represent to the consumer a promise that the gain will be higher than the pain. Nobody wants to get screwed, and most people believe that they will be less likely to be screwed by a well-credentialed person, product, or company. Entrepreneurs who want to be successful will take this into account. When you are crafting your marketing pieces, you should look and see if your company or product has any credentials that can be touted. I have found that the most powerful credentials include the phrases...
If you can make a valid claim to any of these Power Phrases, then you should use them extensively. Use them in your positioning statement. Put them all over your marketing materials. Put them all over your box or packaging if you sell retail. Put them all over your Web site. Using these credentials may not be subtle, but it is effective. To this end, many companies use the term "leading" as if it were a credential. It is not. The problem with the term "leading" is that it is ambiguous. It can be either externally-conferred or self-conferred and people know this. In contrast, the five credentials that I listed above are unambiguous and can be externally verified. That gives them their power. I have taken the power of credentials into account when writing my book. When I first started this project, my pitch was pretty much "Here are all of my great ideas." The problem is that, while I did have some good ideas, little in my background gave me the credibility that would lead most people to give a great deal of weight to what I was saying. To most people I am just another guy. As a result, I have altered my work and my book to include studies of the lives and stories of successful entrepreneurs. That way people like Walt Disney, Anita Roddick, and Tom Peters make my points for me. I just become the guy who notices the pattern and ties it all together. I have been much more successful since making that switch. You and your company will be more successful if you make the same adjustments. ——————————————————————————————————- THE CAPITAL ONE NO-HASSLE CARD If you live in the States and watch football, you can't help but miss the ads for the Capital One "No Hassle" Card. These are over-the-top ads involving people fending off hordes of barbarians, bandits, and other hooligans by waving around their Capital One card. The promise of the card is...
The problem that I have with this ad is that I wouldn't classify any of the above as "hassles". They don't really represent pain to me. They just represent the state of the industry. When it comes to credit cards, pain for me means a card that keeps getting rejected because the magnetic strip wears out too quickly. As a result, I question whether the card offers any real (or at least new) benefits. For example, I don't receive calls from the people who provide the cards that I DO have. It's the calls that I get from the people selling the cards that I DON'T have that annoy me. Maybe the single interest rate feature is nice. However, they completely overstate the problem. Sorry, but it's not that big of a deal to me. The bottom line is that this is a decent but ultimately failed attempt to sell a product using pain. The message does not resonate with me. It just annoys me because it is so over the top. It also points out that you cannot just slap a pain-based message on a product that was not designed to alleviate pain. If you want to be able to sell with pain, you need to design pain out of the product. ——————————————————————————————————- THE PET BUTLER Don Snyder (dontheideaguy@yahoo.com) clued me in to a company called the Pet Butler... https://www.petbutler.com/about.html This is a company whose goal is to take the hassle out of the lives of pet owners. As they say on their Web site... "Every product we make or sell was born out of necessity." They sell products like the Mess Catcher. Here's its story... "We discovered that there was no effective, inexpensive way to keep the mess off the floor around our birds' cages. It didn't surprise us to find that nearly every other bird owner had the same problem. So, in 1991 we introduced the Mess Catcher(TM), a simple plastic tray that goes under the cage and keeps the mess off the floor. Instead of sweeping or vacuuming twice a day, now it's once or twice a week." There are a number of similar stories on their Web site. You ought to check them out. They are a great example of how to use pain to generate and communicate ideas. ——————————————————————————————————- EMPLOYEE ENGAGEMENT I was surfing the Web the other day and came across several references to issues of the Gallup Management Journal in which they give the results of their "employee engagement" surveys. Employee engagement is a fancy way of saying whether you care about your job and your company or not. The results of the October 2000 showed the following results. 26% of respondents said they were Engaged in their work, 55% said they were Not Engaged in their work, and 19% said they were Actively Disengaged at work. I read this as meaning that effectively 74% of the people surveyed could really care less about their job or their company. Wow. Another study found that firms that measure in the top quartile with regard to employee engagement averaged 24% higher profitability, 29% greater revenue, and 10% less employee turnover than businesses in the bottom quartile. Based on all of this research, Gallup projects that a 5% decrease in employee disengagement would boost US productivity by $79 billion a year. While I don't quibble with the results of these surveys, I do have a problem with the remedies that most people and companies propose. In most cases, these seem to me to be very superficial ways of increasing employee engagement. These include "feel good" activities, contests, bonuses, and other behavioral modification techniques. Unfortunately, none of these remedies address what I feel is the root cause of this lack of engagement... Lack of meaning. Meaning is the thing that drives people. It makes you get up in the morning. It makes you stay late at night. Meaning cannot be sprayed onto an existing organization. Work is either meaningful or not. Instead, meaning must be built into the organization's core and then leveraged by geat leaders. It serves as the organization's foundation and the basis upon which all of the company's efforts should be based. The problem is that too many organizations no longer have meaning at their core. Instead, they have become profit machines. While this may provide meaning for the few people at the top who are getting rich, it won't serve to engage the majority of people who are not. The result, as the surveys show, is a large number of companies with crumbling foundations. The low levels of employee engagement are a symptom of these deeper problems - problems that can only be fixed by identify from whence they arise. ——————————————————————————————————- TRANSMETA REDUX Malcolm Dean (malcolmdean@earthlink.net) writes... "Hmm... Transmeta IS in pain, they are ARE innovating... I'm not clear why you're down on them. If Transmeta had not virtually invented the category of low-power CPUs, all those ultra-slim notebooks would not be on the market today. Certainly Intel had no interest in the category, prior to Transmeta. In terms of energy reduction, another painful subject, the only product which competes with a rack of Transmeta CPUs, is an IBM z900 mainframe. And in-chip emulation of Windows is certainly a painful prospect, as far as Microsoft is concerned. So Transmeta is not only IN pain, it is CAUSING pain. Sounds like a prospect for success to me..." Transmeta is in pain because, while their chip does solve some pain (e.g. the pain of having to change batteries frequently), to date they have not solved enough pain to make a real dent in the market. They also do not solve pain in a dramatic enough fashion. It is too easy for companies like Intel to make lower-power versions of their chips that are good enough - that are more efficient than existing chips and almost as efficient as the Transmeta chip. From what I understand, the Transmeta chips use maybe 50% of the power of a conventional chip. This isn't enough to lock up the market. To win, Transmeta would have to follow the 10X rule and cut the power consumption of their chip by 90% - or at least to a level far below what Intel could easily cut down to. Transmeta's relatively small power efficiency advantage is also undercut by their use of emulation - which people have learned is a code word for "slow". People are also being affected by all of the work that Intel did with its "Intel Inside" campaign to beat up on AMD. I just don't see how Transmeta can win when you combine a relatively small advantage in power consumption with a chip that relies on emulation. ——————————————————————————————————- FASHION, LUXURY, AND THE LIMITED Remy Steffan (rsteffan@ifrance.com) writes... "Do you think the pain principle can be applied to every successful company ? I think particularly of companies that produce luxury products like LVMH or Prada. I don't see how these companies solved a pain when they introduced their products. " There is no question that there is a continuum of pain and that pain applies more to some industries than to others. Different industries are driven by different things. However, you are actually asking two questions here, so let me split them and answer them in turn. First, you ask "Does the concept of pain apply to LUXURY goods?" There is no question that the concept of pain applies to luxury products and/or products for the rich. The rich have their own set of problems. For example, the Concorde solves the problem of people who have more money then time (this is a fertile approach to product development). Jim Clark's MyCFO is also designed to solve the problem of rich people who have VERY complicated tax returns. A number of people and companies are making good money off of the rich. You just have to recognize that the market is very limited and you must price accordingly. Second, you ask "Does the concept of pain apply to FASHION goods?" This is a more difficult question, but I think the answer is a qualified "Yes". You also have to be more abstract when you use the term "pain" when you talk about fashion. Perhaps it is better to use a softer term like "dissatisfaction". Coach has made good money by providing a full line of high-quality leather products. Giorgio Armani and Coco Chanel made good money by making the best suits in the world for men and women. In this case, they were solving the problem of unflattering cuts and sub-par fabrics. All of these people and companies solve pain to some (generally lesser) degree. The general rule of thumb is that you have to be offering something that nobody else is offering and that people will pay money for. However, the problem with the fashion world is that it is moved by trends and trends can move your customer base out from under you. One way to survive is to be a high-quality fashion house that is the best at following the trends. You can play against the fact that many other vendors offer crappy, flimsy products that are designed to be worn just once. I believe that The Limited (and the Gap as well) thrived because they did just this. They offered young women the opportunity to buy better-made, fashionable clothes in one place. The phrase "in one place" is critical. What was the alternative before The Limited? Women had to build outfits by going from store to store. This was both a hassle and difficult for some. One of the big things that I think The Limited sold was the opportunity to buy a complete outfit at one store - one-stop-shopping. The story of Banana Republic is also interesting in this respect. They started out as a fad store, faded as the trend faded, and then rose again as a one-stop-shopping place for people who wanted to look hip. They may be able to make this last because some large group of time-pressed people will always be interested in looking hip. Never underestimate the power of one-stop-shopping in this time-pressed world. ——————————————————————————————————- LINE EXTENSIONS Brandon Wilcox (evolve-biz@xtra.co.nz) writes... "I don't know much about the background to this. It must be a North American thing that hasn't reached us yet, but your article was explanatory enough for me to know that Pepsi with Lemon will be the nail in Pepsi's coffin, not Coke's. The world is littered with line extensions that destroy the brand's position, not the competition's. Al Ries and Jack Trout have been writing about this for over ten years and still it happens! They even quote soda examples such as this one... 'Back in 1978, when 7-Up was simply the lemon-lime uncola, it had a 5.7 percent share of the soft-drink market. Then the company added 7-Up Gold, Cherry 7-Up, and assorted diet versions. Today 7-Up's share is down to 2.5 percent.' Written in 1993! It's pretty obvious that, as your article stated, Pepsi drinkers who like lemon in their Pepsi will drink more Pepsi with Lemon and less regular Pepsi. And that Pepsi's position will be slowly eroded. 'Invariably, the leader in any category is the brand that is not line extended,' according to Ries and Trout again.It's another case of incremental thinking rather than the step-change thinking that was behind the original 7-Up 'uncola' campaign." I love the work of Ries and Trout (you should own "The 22 Immutable Laws of Marketing") and I agree that it is clear how they would feel about this whole trend. Another example is Mountain Dew's Code Red. This is a red-colored Mountain Dew presumably designed to compete with a niche Hispanic market product called Big Red. How can you make money off of grabbing a piece of what is already a small niche? This is even worse because the Code Red part is the sub-head - Mountain Dew is the main head on the package. This will only confuse the brand. These kinds of products are about everything BUT pain and will not succeed as a result. ——————————————————————————————————- MISSION STATEMENTS REDUX Brandon Wilcox (evolve-biz@xtra.co.nz) also writes... "I couldn't agree more with your mission statements article. I find that mission statements invariably take up a full page and are framed and hung behind the reception desk. Nobody in the company can tell you succinctly what it says. What a waste of time. Contrast that with Komatsu, the heavy earthmoving company. They were after Caterpillar, but realized they didn't have sufficient product range or geographic spread. They defined their mission as 'To encircle Caterpillar'. Three simple words that galvanized a company. They expressed it in code form on all their business stationery as a copyright symbol (C). Every time an executive signed a letter, the company's mission was staring him/her in the face. Their mission drove them to expand their range to match and exceed Caterpillar's. They built their headquarters across the road from Caterpillar's so they could face the enemy. They expanded their geographic presence to match and exceed Caterpillar's. Talk about focused! Talk about a mission statement that actually WAS the company's driving mission!" I agree that this is a very focused. However, I have a problem with the motivation behind the statement. The problem is that, while this mission statement may work internally, it is of no value externally. No customer cares that you want to kill Caterpillar. They care about their problems. As a result, you can't show it to a customer both because they don't care and they might view it as overly-aggressive - people may still care about Caterpillar. A company in this position has one of two choices...
The challenge of having two mission statements is that you can end up with a schizophrenic organization. Saying one thing and doing another. As a result, I think that the only option is to ensure that the needs of the customer are taken into account in the mission statement. ——————————————————————————————————- Thanks to Brandon Wilcox (evolve-biz@xtra.co.nz) for this interesting and relevant quote from Gary Hamel... "Corporations around the world are reaching the limits of incrementalism. Squeezing another cent out of costs, getting the product to market a few weeks earlier, responding to customers' enquiries a little bit faster, ratcheting quality up one more notch, capturing another point of market share - these are the obsessions of managers today. But pursuing incremental improvement while rivals reinvent the industry is like fiddling while Rome burns." This is precisely the problem with the current state of the art of idea generation techniques. They are decent at coming up with incremental ideas but are of little use when it comes to generating new-to-the-world ideas. ——————————————————————————————————- Please send all comments or feedback to chris@thepowerofpain.com SHARE THE WEALTH. FORWARD THIS NEWSLETTER. Any other unauthorized publication, excerpting, or duplication of the contents without the permission of Christopher K. O'Leary is a violation of copyright law. To subscribe to The Pain Papers, please send a message
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