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Customer Manufacturing Update |  |
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Dear Mitchell, Here is your October Customer Manufacturing Update. This month we're sharing 10 pricing mistakes our friend and pricing expert Jerry Bernstein suggests are too often made by sales people.
If you have friends or colleagues who would
appreciate receiving this Update, feel free to
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at the bottom of the page.
Pricing and pricing strategies are a key component to profitability. Maintaining your price in today's market is especially difficult. Sometimes it is made more difficult by tactical mistakes made at the point of sale. This month's white paper looks at 10 pricing mistakes too many companies make. If you see yourselves in any of these, action may be required to maintain effective pricing.
Everybody has an opinion about ads, which is why Marketing people get so much "help" with deciding how to advertise products and services. The ad in question is interesting for a lot of reasons:
All that being said, the question is really will it help sell the product? We don't know if the ad is actually causing an increase in sales, and the advertiser isn't going to tell us. However, we offer it here for your amusement and comment if you so choose.
John Potter, U.S. Postmaster General, is widely quoted as saying that the USPS must "consider everything" in fixing the revenue shortfall and losses facing the USPS. He is then quoted as discussing options such as closing branches to allow contract locations inside grocery stores and other retailers to provide more of the services that the Post Office now provides. He also is discussing eliminating Saturday delivery. His focus is on efficiency given the decline in usage of the USPS due to the increased use of email. Those all may be good ideas, but the USPS still suffers from "monopoly mentality," and their people and processes are too often focused inside-out rather than outside-in (from the customer's perspective). Two recent and separate examples bring this point home. A friend recently went to the Post Office to obtain a passport, which is the way it is done today. Upon completion of the application he attempted to pay for it by credit card. He was advised that the USPS does not accept credit cards for payment of passport fees. Since he did not have any checks or enough cash with him, he left that section of the Post Office, stood in line and bought a Postal Service money order, which he paid for with a credit card, and took the money order back to the clerk and paid for his passport fees. Go figure? We ship books ordered from our office via USPS Media Mail. Our office manager recently discovered that the stamps sometimes did not stick to the envelopes we were using, so he went to the Post Office to inquire how to solve the problem since the packages were being returned to us undelivered for "postage." He had considered taping the postage to the envelope (a standard bubble envelope purchased at the office supply store) and was informed, in no uncertain terms by the postal clerk, that such action was unacceptable. She did not threaten him with arrest, but did make it clear that the package, with clear tape over the postage, would not be accepted by the Postal Service. He asked her for other suggestions which met with a curt response that basically suggested that it was his problem to solve. He advised her that his solution was going to be to use FedEx Ground in the future. She wished him "good luck with that." While we are not a large shipper by any means, there will be fewer packages from our office going by US Mail and a few more by FedEx. And undoubtedly the Postmaster General will believe this was beyond their control and will need to be addressed with cost-cutting. In the mean time, USPS was notified last week that their requested postage rate increase was denied.
The mis-application of 6-Sigma to innovation and creativity is seen too often. However, the idea of removing waste that does not add value can still be applied to so-called creative processes. To wit, Partners & Napier, a Rochester, NY ad agency. Like many ad agencies today, they are being pushed by their clients to cut prices. If you don't figure out how to cut costs along with those prices, your profits suffer. (Now there's a shocker.) When their #1 client, Kodak, demanded that they cut prices, the firm was worried creative would suffer, since "... no one understands how long it takes to get a great idea." Like most companies that are looking to reduce costs, they started looking in the wrong place. However, by going through a rigorous process improvement methodology, Partners & Napier found that the real waste occurred outside the creative process. They confirmed, among other things, one of the key ideas we teach in our Lean Marketing/Sales Workshops: Most approval processes are waste. They are classic re-work created because the first effort was not correct. At Partners & Napier they found a lot of waste in the back-and-forth for approvals of briefs, concepts, and ideas. Re-work is waste, no matter the process. If you work in a creative endeavor and are beset by re-work you think is unavoidable, consider that is what classic manufacturers thought about their re-work as well. That is also what product development and project people thought. And, that is what Partners & Napier thought. To quote Apple: Think different(ly).
We appreciate any feedback you can provide to help us make sure these Updates give you value each month. Feel free to respond to this e-mail with any comments or suggestions for future topics or ways we can make these Customer Manufacturing Updates more valuable to you.
Thank you for your interest, and if we can provide
any
additional assistance in sales, marketing, strategy, or
innovation to help you increase your sales,
let us know.
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