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Two natural ways to increase sales

Bob2

A business owner friend and I were discussing the current business environment this week, and swapping notes on what works (and what does not) when it comes to increasing sales.

Assuming the product and services are in demand and provide value to customers, there seem to be two relatively easy ways a business owner/development manager could increase sales …

  1. Attend 2 or 3 business events a week

Now, a word of caution here. You don’t go along with sales uppermost in your mind. Your intent is to meet new people, make some connections and add value to their conversations and knowledge.

The more you do this in the right spirit (‘give more than you expect to receive‘), the better you will become at it, the more people you will meet, the more of their connections you will be allowed to make, and you will actually walk away with more sales opportunities, and ultimately more sales.

People are naturally gregarious, which means we are wired to cluster in groups. (Be they sporting clubs, political parties or when we attend a business event.) So go along to these gatherings, regularly, and, although it might seem a bit daunting at first, here’s a trick I learned from the master of networking himself, Ron Gibson:

As you walk into the room, don’t go over to people you already know (by all means say ‘Hi’ to them) but head directly for those you don’t. In fact, make a beeline for a person who is on their own. They will probably standing at the fringe of the event, hoping the walkpaper swallows them up, feeling a bit uncomfortable and nervously looking at something interesting on their phone. They will normally be relieved and delighted to see you approaching them, smiling, introducing yourself. Ask them what they are doing here, what their business is, and engage them in conversation. Show genuine interest in what they do, while exploring in your mind how you might best help them. (Not how they can help you, the other way around). When you get a chance let them know how you can help them (if possible) and also explain what you do, and you’ll quickly see if there is any common ground. If relevant, swap cards, and maybe promise to catch up in a few days time. Try to make 4 or 5 new contacts this way at every meeting. Attending 2 or 3 a week means you’ll quickly gather 10 or more new potentially useful business contacts every week, and remember, each will have 100 or more contacts of their own. The value of this regular exercise is the permission you win to gain access to these new people.

Pick your events wisely. I have found the ones set up expressly for networking are not necessarily the best ones as they can attract those that are only trying to sell. You know the kind. The same people frequent them, they are usually free. Go to a variety of professionally run (and often paid for) business functions, because that’s where the interesting business people are. As a nice bonus, you will also learn much from the presentations and discussions on stage. Some might be stand up cocktail functions, others a sit down breakfast or lunch. Either way, there will be opportunities to mix and mingle, where it is far easier to stay seated or in your comfort zone. Most will stick to who they know. But as a wise sale coach told me recently, you only grow when you are out of your comfort zone. So get up and go meet some people. People are naturally friendly in this setting, far more so than if you cold called them. So get it done!

Consistently doing this over time expands your own networks, and believe me, for someone like me, not born or bred in this fair city, it has worked a treat.

In fact, failing to do this not only harms your business, it also limits your career opportunities. I’ve had 6 jobs in my 30-year career so far, but have only ever had less than a handful formal job interviews. My last 4 jobs (spread over almost 2 decades) have not stemmed from a formal job interview at all. They have been gained through networks I have forged over time, and often from cups of coffee or a phone call from a referral. I even sold my business within 6 weeks of an initial coffee meeting where the idea was first mooted.

Following up with those people you can help, that you might open doors for (and they you), is critical. This is where you need a good system to lock away your new contacts in your Outlook Contacts or a CRM (client relationship management) system. Using something like CamCard (a free app that takes a photo of business cards and automatically synchs the data into your contacts) can make it a piece of cake.

       2. Treating LinkedIN like a business event

I treat LinkedIN in the same way I do a live business networking event – I go there to meet new people, connect and add value. The more you do this the more new business will drop off the bottom as a matter of course. I also do this with Twitter, and to a lesser degree Facebook and Instagram.

Essentially, LinkedIN is very much like business networking, except you don’t have to physically meet someone first. Again, don’t go on there to sell, go there to connect and add value, and in time you will meet loads of new people, some of whom will be interested in how you can help them (and they you),  and the permission to sell to them (or one or more of their contacts) may be granted. I have met many new business contacts this way. I have also used it to get into a company, that hitherto had seemed impossible.

As in networking events, be careful not to cross that line. Don’t go on LinkedIN too much (10 minutes a day will suffice), and use it to meet new people, publish and share interesting information. Be the better Roman. Share and like other people’s posts. Add some comments. Share and publish something of your own.

~

As with all these things, it’s about persistence and consistency. If you only do a little bit for a few weeks assuming this to be ground breaking, you will be sorely disappointed. Do not expect results straight away, learn as you go. Don’t overdo it either – there are people in every town (mine included) that have a bad reputation of spamming people on these networks and at business events. They’re always there, and sadly, they seem blissfully unaware that whenever their name is mentioned, you can hear collective groans of disapproval. Don’t be them!

Get out there and be seen, both physically and on LinkedIN, in the right way, and I promise you will make more connections and win more opportunities to do more business. You might enjoy a pretty nice career as a result.

Extra resource: Read this excellent post > ‘Scared of Networking? How to kill it at your next event

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Uber disruption

share and share alike

Last week I got the chance to listen to Jerry Hausman, an economics professor from MIT, who spoke on ‘Startups – will their economic models take over?’ – a topic close to my heart.

The 70 year old econometrician started by pouring scorn on Twitter (‘I mean, don’t you have something better to do?’) which I thought was wonderfully ironic, given his audience contained the esteemed business leader and well known Twitter aficionado, Diane Smith-Gander, who was tweeting away live at the time. The point he was making was he was not necessarily a raving fan of these new businesses, despite being an avid user of Uber (‘They are 40% the price of taxis in Boston – in fact you could do away with public transport and give everyone Uber vouchers and it would be far cheaper for government’).

Uber’s valuation of US$62 billion and Airbnb’s of US$30bn defines them as ‘unicorns’ (valued over a billion) and have come from nowhere in less than 10 years. This was simply not possible when Jerry (or most of us) were growing up. ‘Stanford university was a backward country college, not even Ivy League, now people drop everything to get in there.’ Stanford has spawned Yahoo!, Google, Hewlett and Packard, Youtube, LinkedIN, Netflix, Paypal, Cisco and Sun among its alumni and is known as the ‘billionaire factory’.

The poster child of the sharing economy, Uber, has been incredibly disruptive forcing regulatory fights (and invariably, wins) in 68 countries and 450 cities. ‘Uber keeps dropping its prices and driver compensation, yet Uber wants to maximise revenue, so has to drive huge increases in sales.’ argues Hausman, ‘The drivers are earning less and less – in the US they only drive 13 hours week – and they also have to run their own cars paying for maintenance, petrol and depreciation.’ Jerry pondered if the Uber drivers were getting a good deal or not, and thought not.

In the US, cars are only used 4% of the time, and with regulation lagging the fast development of Uber, there is still upside for the company in terms of usage, and savings in costs for users. Imagine if the continued rise of Uber and their ilk meant that cars were used 25% of the time (a 6-fold increase). Many of us may get rid of our second car, or even give up owning a car altogether, as ownership made less and less economic sense. Imagine what would happen when self-driving cars become the norm, that you can hail easily through an app. What would that do to traffic congestion, car accidents, the environment, public funding of new roads, the health system, taxation, the insurance industry, car industry and car park revenues? This would disrupt many sectors, and drive fundamental changes (some for the better, some worse). But it does hinge on the economic model for Uber and their drivers working, and the public’s acceptance of the car sharing economy. Airbnb can do likewise for accommodation. I see many startups trying to be the ‘Uber for the x industry’. It’s the startup ‘model du jour’. We teach our children to be good sharers, might we as adults do likewise?

Jerry is not a fan of regulation, above the minimum, as he sees it crowding out efficiency and entrepreneurship. His favourite phrase was ‘I’m a fan of capitalism between consenting adults.’ Any large industry that has been over regulated over time is ripe for these new models to take hold. ‘How about the real estate industry’?, I asked him, ‘Is anyone, or could anyone uber that?’ Jerry replied, ‘It’s easier to uber your car ride, or your stay in a hotel, as we’ve all given lifts to people in our cars or had people over to stay. But the average person simply does not sell their property very often, so it’s not something they feel comfortable doing on their own. It’s a big ticket item, often their largest financial asset. That’s not to say it can’t happen, ever, but that will be a more difficult one to disrupt.’

I agree, and it’ll probably take some time before the real estate transaction is done directly between buyer and seller, but I also bet some people somewhere are working on this, and over time, even this transaction will be changed irrevocably. My advice to real estate agents, as it is for taxi drivers and hoteliers and anyone in a regulated industry, is to be aware of these creeping changes that can disrupt your entire industry, seemingly from nowhere. Don’t scoff at the technology, have an interested and serious look into it. Stay relevant. Keep your customers close. Don’t assume anything. If you wait until you’re waving placards on the steps of Parliament against some well funded and beautifully designed upstart to get interested in the sharing economy, you’ve already lost.

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A failure to communicate

Martin Luther King

No one’s listening anymore. Not for long anyway, as in, not for more than a few seconds. In this twitter era of short concentration spans, communication is boiled down to 3 word phrases and little else. You get passing attention. There’s just so much ‘stuff’ going on, flying by on newsfeeds and instachatter.

Recent elections around the world show this trend is only becoming stronger. UK politicians, with right on their side (130 vice chancellors from ALL 130 UK universities backed ‘Remain’), failed to convince more than half the voting public to stay in the EU. Trump’s rise is similar, in that his support, and those of Brexit, is mainly made up of older people and/or lower educated, working class whites. The new economy has done them no favours, it would appear, and there’s an underlying fear and confusion about foreigners, immigration, disruption and terrorism. Why couldn’t the EU do a better job of explaining the benefits of its club to its 2nd largest member? Why couldn’t the two main UK political parties?

In the Australian election, the longest campaign for decades failed to grasp people’s interest for long, so each side resorted to 3 word phrases (Jobs and Growth vs Putting People First) and towards the end even those were (if you forgive the pun) shortened: Save Medicare. In the absence of attention, nothing succeeds like fear mongering, so the Libs went with ‘security’ (due to the uncertainties of brexit, busts and boats) and Labor went with Medicare. Which do you fear most people – losing your job or paying more for your GP?

The result? a brexit buyer’s remorse in the UK (‘bregret’ they are calling it), a hung parliament in Australia and the possibility of President Trump. Australian voters could now get both of the fears realised – an uncertain economy, with more redundancies due to less investment and activity AND paying more for health services due to an ageing population and ballooning costs.

Meanwhile the US election will drag on for another 4 months. Either way, Trump wins – the Presidency or major personal brand inflation. I have a feeling he’d plump for the latter, such is his ego.

So what’s going on? No doubt, fear mongering is behind most of these results (it’s a raw emotion and everyone from the sleazy salesperson right up to the pollie draws on this), but it’s also a massive failure of communication.

Perhaps the greatest skill of the leader is to communicate their vision and bring people along with them. Obama could do it, perhaps the greatest practitioner of the set piece speech since Reagan, Martin Luther King  and JFK. Roosevelt could do it. So too Churchill and Lincoln.  Of course, you need more than the ability to deliver a great speech, but without it, everything can be nought. It’s a necessary, but not sufficient condition of leadership. Neither John Howard nor Menzies were great orators, but they were OK at it, and led for over a decade. Kim Beazley was particularly good at it, but never became PM.

Obama showed, in this instant snapchat world, how you can reach hearts and minds. He may have disappointed many with his results since, but he showed you can be articulate and sensible while being rousing and passionate. He struck the right tone, and was (in himself) a fantastic story. And yes, the best orators are also the best story tellers. Clinton (Bill) could do it, Hillary, less so. But she may yet prove to be a sensible choice for President. Not a great campaigner perhaps, but given the choice between a great campaigner and a great President, I know who I’d choose. Often to get the one, you need the other. She’ll have a tough time as President unless she can convince the country, congress and the Senate to come along with her. But she won’t be President unless she can expose Trump for who he is, and put forward her own positive agenda with clarity, while overcoming peoples’ natural aversion to her ‘untrustworthy’ image. It’s all very mucky really, on both sides. And yes, it has come to this. Don’t expect ‘debate’ (if that is what it is) to improve anytime soon.

Many people waking up in Australia today will again bemoan the lack of leadership, and within it the lack of ability to communicate a strong vision and bring more than 40% of the country along with them. On either side. The two main parties again failed to win more than 80% of the total votes cast. Weird and wacky minor ‘parties’ (people really) have been elected and will hold the balance of power, perhaps in both houses. We see the return of Hanson (Australia’s Trump) once more.

No one says communicating your ideas is easy, but it’s critical. Without it, what are you achieving anyway?

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CEOs sleep out for the homeless – 2016

sleepout-$$$

The CEO Sleepout last Thursday night was another humbling and thought-provoking experience for me, plus the other 100+ WA CEOs who braved the cold and hard concrete floors of the WACA, armed only with a thin piece of cardboard, a sleeping bag and a pillow.

sleepout-place

My spot for the night

I found the same spot I had used 6 years earlier, and actually got more sleep than I anticipated (2 or 3 hours maybe?). While some wanted to be on the grass outside (the dew and wet would make that very uncomfortable), I snuck down to the bowels of the Lillee Marsh stand to claim a quiet spot next to the cafeteria. It was warmer than expected, although a cold breeze came though in the early morning lowering the temperatures to single digits.

In all, the 104 CEOs of Perth (and their generous supporters) outdid all other capital cities other than Sydney in terms of donations.

Money goes to the St Vinnies, and is put to good use. Homeless shelters, places where homeless people can get a shower, clean their clothes and sleep the night, are provided for the 9,500 who sleep rough every night in Perth, part of the 105,000 across the country. Mental health services, support, social justice advocacy and partnerships are provided.

sleepout-tvo

Talks from the homeless and a panel discussion educated the CEOs on the issues confronting homeless people

The stats are saddening – homelessness starts young. 40% were homeless before aged 15, so they are at school. Often the school is unaware.

Over half start out their homeless journey coach surfing at friends or relatives (63%). Usually it has been spawned by parental conflict and/or domestic violence which means they are on their own. If no other options are available they go to a street or a park (16%). They have basically left home, and have nowhere else to go.

53% have mental health issues, 20% have attempted suicide in the past 6 months. 84% are unemployed. Only 31% complete year 12.

James Lush interviewing Barry Felstead on ABC radio. Barry raised $120k+

James Lush interviewing Barry Felstead on ABC radio. Barry raised $120k+

Youth homelessness takes up a disproportionate amount of GP time and costs, so too hospitals, emergency, law courts and victim assault services. Usually they are the victim. Being out on the streets is not safe. (At least we CEOs were perfectly safe, the odd discomfort for one night our only issue.)

All of this costs the tax payer $750 million a year, yet the amount of money provided for homelessness overall is far less.

Research shows that the simple fact of providing shelter greatly reduces their instances of crime, victim assault, suicide and mental health issues and greatly improves their chances at school and in getting a job.

It starts with a place to call home.

Then, if education and training can be provided, their life can be changed for the better, and they can join society on an equal footing.

All power the CEO Sleepout and the Vinnies. Well done and thanks to the CEOs and their supporters. Thanks for over 50 generous souls, I raised over $5,800 for the cause, more than double what I raised when I last did the sleepout in 2010.

You can still give to the cause (up to the end of August), so please donate if you can – the cause is so important, and the money goes to great use.

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My day as a courier

Tradesmens Entrance

On Friday I helped out delivering boxes of books to clients. It was a nice change from the desk job, and got me out into 13 offices from across the city, through East Perth, up to Joondalup and back down to Osborne Park and West Perth.

There were 9 books to a box (each book a 228 page hard cover volume), and you could fit about 6 boxes on our trolley. It was heavy menial work, and I was quite glad I didn’t have to do this for a living everyday. I earned a new found respect for those who did and my arms are still aching 24 hours later.

It was eye opening in another way – the manner in which we were greeted (or not at all). While most offices were fine, some concierges frowned on us at first glance. I would assume these offices take all kinds of deliveries all day, every day, and that the appearance of 2 lads with a trolley of 6 boxes was not that uncommon.

One place greeted us with a hand held out (as if we were invaders) telling us in a loud voice (so everyone in the foyer could hear) that we had to back out of the revolving doors and move down the side street to the back entrance, where we would be let in. When we got there, there was a locked door, a CCTV camera and we had to wait to be let in (state our reason again) and go up the back lifts through the underground car park (which came every 5 mins or so). This added 15 mins each way for each trip (we had 4 lots of 6 boxes to deliver to that building). Strangely, on our last trip down, the same concierge travelled down in the lift and was all smiles.

Nothing wrong about this necessarily, but these are the exact same offices I would have swept into countless times before, all suited up in order to meet the exact same clients. At those times, I would walk confidently to the front lifts and never give the concierge the time of day (nor they me).

Same person, different dress code. Same client, different reason.

It got me thinking about how we treat different people based on their purpose, status and uniform. It reminded me of the Secret Millionaire, or Undercover Boss, where rich people go into poor areas, or their own company, in disguise and see for themselves how things are really done, and how people treat each other.

I hope I treat visitors to our office with equal respect, whoever they are – a Minister, a client, a staff member, family member, a tradie or delivery guy. I will be more aware from now on, and when I visit the same offices in a suit, I will not assume a thing.

~~

Finally, in another ‘perception switch‘, I am doing the CEO Sleepout this Thursday, joining 100 or so others sleeping on cardboard on freezing stone floors, raising money for the homeless. I am 80% of the way to my $5,000 goal, so if you can help me get there, I will be very grateful > here’s my donation page.

 

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Set creative content free

Messy desk creative mind

Let us consider the desk of a music teacher. It’s a mess. Scraps of paper. Bits of old instruments. Manuscripts. Old tour programmes. Scrunched up notepad. Yesterday’s lunch remains. A half drunk cup of coffee. A lunky gonk. Some chewed pencils.

A Music teacher’s desk is the desk of a creative mind. It’s a buzz, a whirl, managed maelstrom. But put that same teacher in front of the school orchestra, and somehow magic can happen.

Imagine John Lennon’s mind, Mozart’s, Steve Jobs’.

Imagine what they must have been like to live with. Read Walter Isaacson’s authorised bio of Jobs and you don’t need to imagine anything – he was a pain in the proverbial. Maddening at times, brilliant at others.

Yet he looked at things millions had looked at before and saw how to think different. Looked what he created.  Not once, but twice at Apple, and also at Pixar. The Mac would have been enough for most people. But the out of nowhere he releases the iPod, 1000 songs in your pocket and single handedly saves the entire music industry.

What right did a computer company have in making music playing machines? And before you think “agh, but he controlled creative content, he did not set it free”, he actually did the complete opposite. He set us all free to buy creative content, for $1.29 or $2.19 from iTunes, because he knew that creating a new way to release the content did not mean no one pays for it.

It was FREE in terms of freely available (we can all, now on a whim, download any song to our device in seconds, which was just not possible a few years earlier or when you or I were growing up), but not free in terms of payment.

It was an elegant technological solution to a massive problem (something all startups should look to emulate). He set the content free, and billions of downloads and dollars followed.

Not finished there, Jobs then created the iphone in 2007 and ipad in 2010. What was he doing with phones? Thanks to Jobs, my phone is now my camera, my notepad and my diary. And a hundred other things.

Tablets had been a disaster for Microsoft in the 1980s. Yet whoosh – a mass of new creative content results in apps and the App Store. A whole new industry was created from thin air. And it revolutionised how we consume content. Much of it is (yes literally) free to consume.

Creatives can be a pain to work with, but without them.. you just get more of the same. If you want routine, order, then have control and carry on as before. If you want to create, set it free. Let others co-create, collaborate and fly.

I was the economics teacher. I was ordered. I was on time. I got good results. I dotted the i’s and crossed the t’s, and it worked.

When I went into business, thank goodness I did not do it alone. I met a crazy Steve Jobs’ type on the UWA MBA and it was his idea to set up the world’s first map-based property search web site, aussiehome.com, right here in Perth, way back in 1999. Nick was (and still is) a crazy guy, part genius, part brilliant, part rude, blunt…. We were ying and yang, it worked.

To think the new, means not saying ‘cos we’ve always done it that way’. When we ran aussiehome, we banned this saying. People learnt quite quickly that ‘but we’ve always done it that way’ was NEVER the answer, to ANY question. EVER!

We had ideas some mornings that went live that afternoon. I have since worked in other environments and the simple act of changing one web page was so controlled that nothing happened … for years.

Whatsapp, Snapchat… have little revenues, yet have been set free and are now each worth billions. They have 500m and 150m active monthly users respectively by setting their content free. YouTube, Facebook, Google, Twitter, Linkedin… have all been set up with free content, available to all, everywhere. That does not mean they do not earn money – Facebook earned $18bn in revenue last year, $3.5bn profit. Google revenue $74bn, $5bn net profit & 57,000 employees.

All are pioneering new 21st century biz models.

So, come on everyone, let’s free our better creative internal angels.

Start a blog. Learn to tweet. Take up a musical instrument. Write a book.

You’ll never feel as free as when you are feeling free and creative, doing things that are new and exciting, pushing the envelope.

Oh, and by the way, please feel free to tweet this content for free…  :)

 

Photo credit: What we talk about messy desks blog

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Sloganeering

Keep Slogans for consumer products

There’s nothing quite like a neat, succinct slogan (or natty headline for that matter) that neatly encapsulates a big point into a tasty few words.

Businesses strive for this with ‘tag lines’ for the promotional campaigns – ‘don’t cheat on the cheese‘ is one I remember back in the 1980s, being a TV ad for UK cheese producers. I remember being in a zoo in Holland, of all places, and hearing this line ring out from a couple of loud English lads. ‘English abroad, so embarrassing!’, I said to my Dutch friends at the time.

Another one was the classic ‘Tunes‘ ad for cough sweets, which ended with the newly cleared up man saying ‘Tunes’ in a self-pleased manner to a rather surprised looking railway ticket counter staff member. Many of us would imitate the way the word was said, and hence would help spread the brand name, much like, ironically, a virus.

So I like a good slogan. Well delivered.

Where I don’t like a good slogan is in politics. Especially if that’s all you get. Politics is more important than cough sweets and cheese. We’re talking about the people that make laws of the land, take charge of armies, the economy and represent the country in living form. Slogans may make for easy sound bites and get taken up by the TV media and social media feeds, but they don’t make for considered debate. They don’t elucidate, they aim to simplify and deflect.

After decades of political sloganeering, first made famous 50 or 60 years ago (“I like Ike” and “All the way with LBJ”), we have somewhat distilled all political discourse down to a few words. “Stop the Boats” did for Tony. “Kevin Oh Seven” worked for Rudd. “Change you can believe in” was Obama. “Make America Great Again” is tapping into a large section of disaffected US voters right now with The Donald.

What I’d like to know is (to use another catch cry) “where’s the beef?” Where’s the real debate, the insightful discussion? Back in Abe Lincoln’s days, people would come from far and wide to hear a real debate. Speeches would go on for hours. Sloganeering would not do (on its own).

If the US is to elect President Trump, then he needs to be be made to work harder than spout dangerous invective that might look good on a bumper sticker, but has no substance behind it. You know, like actual policies, experience, analysis and thought. Any time he is asked for the second and third sentences behind his headlines, he struggles to provide substance.

If people came to me for a job I would probably place them in an interview, initially on the phone and then face to face. I would not be doing my job if I allowed them to get away with limp, empty answers. If they evaded the question, I would re-ask the question or take them to task. It’s too important when you are selecting someone, who the business is going to invest possibly several hundreds of thousands of dollars in over many years. Hiring the best people is one of the most important jobs of senior management.

When Trump is asked who he consults on foreign policy issues (he has absolutely no experience of this important area) Trump says “myself, primarily .. because I have a very big brain.”

Seriously? This is your answer? Would Obama have been allowed to say such a thing? I remember a Vice President getting into trouble for not being able to spell potato (hardly a heinous crime). If Trump did this, he’d smile, shrug his shoulders and somehow blame Muslims or Mexicans.

Reality TV (for that is where Trump has come from) has infested presidential campaigning. Trump is supremely successful at the former, and he’s segueing this into the latter. How disturbing is that? How dangerous.

Hillary Clinton, in a foreign policy address this week, eviscerated Trump’s ideas by not even calling his ideas, ideas. “They are just a series of bizarre rants, personal feuds and outright lies.”

“He’s not just unprepared, he is temperamentally unfit to hold an office that requires knowledge, stability and responsibility.”

Note how Clinton did not just say he’s unfit to be President, it went far deeper. In a 35 minute address, she outlined her own policies and credentials (which are very much on the record) and made the case (at last) that Trump is just too fragile, too much of a walking joke, to ever be anywhere near anything like Presidential office. This wasn’t about Trump’s policies (what are they anyway?), it was about his very character.

Devoid of anything but an ability to self promote, that is exactly what Trump does – self promote, through incessant call ins to 24 TV news channels (feeding the beast, who gleefully take it up and give him time) or through 140 character bullying statements on his twitter account. If anyone in the media does stand up to him, he simply boycotts their show. As Clinton was speaking, she mentioned that Trump was probably stirring up another twitter rant right now – and of course, he was. Despite Clinton quoting him word for word on many occasions, he just called her ‘Crooked Hillary’ and described the things she said about him ‘not honest!’ More slogans.

So, are we going to see a sloganeer win the highest elected office on the planet? It’s not out of the question. And if that happens, what does that say about what our politics has been reduced to?

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Beware the creeping changes

monsters

Things that creep up on you can be the hardest to recognise and defend against. Whether they be imaginary spooks hiding in the dark to frighten you from your slumbers, or people quietly tip toeing up behind you to shout ‘boo!’ in your ear, if you don’t see it coming, it can be unnerving when it’s already upon you. Of course, you are at your most vulnerable when you have no idea what is about to hit you.

Last week I saw a stat that really summed up all the digital changes that have been happening over the past 15 years or so. Online advertising in Australia surpassed the A$6 billion mark in 2015.

6 big ones.

The growth is not slowing either; since 2010, online ad revenue in this country has been rising at more than 20% a year. Last year it grew 28%. Within this growth, mobile ad revenue grew 80% last year, and video ad income 75%.

Online ad revenue was almost zero in the year 2000. I remember that year well. It was probably the toughest year of my life so far. There were illnesses in the my family, two friends of mine succumbed to cancer, and it was first year of my fledgling tech startup. Our initial seed funding had run out, and we had passed the dotcom crash after which no more investment funds would be forthcoming. I had quite a few sleepless nights, and not a few doubts. We had a few real estate agencies on board, but very few were paying very much, and it was going to take a while for us to get to cash flow positive, let alone profitability.

A few years on, I remember when online ads in Australia went over the $1 billion mark (2003) and then within two years had doubled to A$2 billion. At A$6 billion, it is now the number one advertising medium in the country. Print ads have fallen to A$2.2 billion and set to continue their decline. Movie ads, radio ads, TV ads, are being left in online’s wake.

When I talk to online tech people these days I joke that we had almost 100% market share of the online real estate ad market in Perth in 2000, but unfortunately it was 100% of very, very little. But as the online market grew, we kept ourselves alive long enough (sometimes I wonder how) to take advantage of the creeping change that was occuring all around us. We built a nice little business out of this, with real profits appearing in year 5 and dividends paid to shareholders from then on.

Today, realestate.com.au (ASX: REA) is worth over A$7 billion (share price $55). In 2000, REA Group’s share price was a mere 12c (half its listed price of 3 years earlier). It was touted as yet another dotcom disaster, an example of greed overtaking common business sense. With 3 CEOs in 4 years, it was but a few months away from closing shop altogether. Or so the wise analysts thought. By 2008, it had billion dollar value, and now after another 8 years is seven times that.

We weren’t the only ones to see that real estate search was broken in the last century, and that the new one would herald a new way of finding your next home. Many people knew this was happening, but the incumbents paid lip service to the imminent threat. Very few people are crying for them now. The 2 weekend papers that once had huge real estate (and cars, and jobs, and boats…) sections in them that landed on your doorstep with a loud thud, are now so weak they are having to combine forces to give themselves a few years more life. In an isolated marketplace with little competition (bar online, which they don’t have much share of). They hide their limp real estate sections in among the cartoon section. A tie up that was once thought anti-competitive, is now being hurried through.

I was once in a boardroom of one of the main paper-based media empires during the early 2000s. Accosting me from across the table, one executive jabbed his finger towards me saying: “Why would we turn a $380 million business into a $38 million dollar business?” (the online ad market being much smaller at the time, his reasoning was why would be chase the internet market and so herald our own demise?). Pausing for a while to take in this question, I answered “Because you have to. And if you don’t this year, it will only get more expensive the next year, and the year after that. It will only get harder for you to make the change.” He glared at me like I had lost my mind.

In all of this is a lesson. Never take things for granted. At your peak, be your most worried. When feeling most comfortable, be nervous. Analyse what is happening, what could happen, what you could do to take advantage of things. Some things will lead you down dark alleys, some of it will be wasted time, dead ends, but you’ll be experimenting, learning, feeling your way. No one can predict the future, but the onset of online advertising was certainly something that could have been foreseen, in the same way mobile and video ads are now galloping along.

Get on trend, or be left behind.

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The $10 challenge

making the most of your resources

As a team exercise, you are given $10 and told to turn that into as much money as you can in a month. What would you do?

I used to give my management and marketing class (Year 10s) this challenge in their first lesson, and see what they would come up with. They’d be given some basic rules (no gambling, no begging, nothing illegal or immoral) and they’d have to work as a team to come up with a hypothetical solution. I wouldn’t actually give them $10 and they wouldn’t have to go through with it.

I’d sit back and watch. Some formed teams quite well, a natural leader emerged. A few ideas were thrown around, tested and they quite quickly came up with a few that needed further exploring.  Some groups saw it as an easy ‘doss’ lesson, sat back and did little. The noise rose. Other flicked pencils. It was quite different to how they’d been used to be taught, and they probably thought I was a little bit wacko.

I checked in from time to time, circulated around the groups, but other than that pretty much let them get on with it. For a double lesson a week they could work on this, plus some homework, and after 4 weeks they had to prepare their written plan, and a presentation with visual aids. They could decide who did the writing, who did the speaking, who did the visuals. In their other weekly lessons I taught some skills that might be useful, but did not make the link too blatant. The brightest realised I was helping them along, some others thought this was a proper lesson and took notes, but did not apply it to the $10 challenge.

When the day for presentations arrived, the groups that had slacked off relied on bravado and ad libbing to get them through. Their presentations were faulty, minimal, there was little thought and they mainly limbered along to an end, usually well before time. The others that had taken it more seriously went through some of the possible solutions, before building up a case for their best options. I gave a trophy to the best solution.

I did not care which solution they came up with, it was more the process I was interested in. From it, I could see their beginning level on leadership, team work, resourcing, budgetting, planning, risk taking, scenario planning, costs and benefit analysis, culture … pretty much anything relating to business and management really. During the year, the exercise became a rich vein of examples to refer back to. Later, some would tell me, ‘I wish I’d taken that more seriously, Mr G.’ Right.

I was at another one of those innovation breakfasts the other day (it is the topic du jour  after all) and I heard Shaun Gregory (Senior Vice President at Woodside) talk about a similar $10 challenge given to final year Stanford University students. ‘Turn $10 into as much as you can in a month, and come back and tell us how much you made and how.’

One group bought a few bike pumps and pumped up student bikes for money around campus, and had made $100 or so by the time of the presentations. Smart. Industrious. 10x return (less labour costs.)

Another took reservations in popular Silicon Valley restaurants and then sold these off for money to the highest bidders. They did not even spend their $10, but had a few hundred dollars by the end of it. Clever.

The winning group thought quite laterally. They sold off their own presentation spot to the company that wanted to present to the Stanford Uni graduating students. Top Valley companies compete for the best and brightest talent, and pay huge fees to research companies, sign on bonuses and countless internal hours in search. Here was a golden chance to pitch their business to the elite grads. The winning company paid many thousands for the chance.

We don’t even need to teach entrepreneurship to 15 year olds (or even under grads), we just need to give them the opportunity to have a go. We need to tell them it’s OK to have a go, to fail, to set up a company, to try to solve a problem, to look at things differently. We learn by doing. We need to say it’s OK to have the aspiration to be a lawyer or a doctor or a plumber or a singer or a social worker or a teacher, but also an entrepreneur. We need to celebrate entrepreneurship and success. Those that have a go. Those that take a quantified risk.

Here’s a final thought. If the $10 was ‘your life’, how are you going to make the most of it…?

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Economic growth set to continue

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I’ve lived through a few recessions in my time. I still remember getting the candles out (yes, really) during the miner’s strike of the early 1970s in England. I was 9. It was fun – as a family we knew when the power cuts were coming to our little town, and when to get the candles ready.

The oil price shock brought on by the Arab-Iraeli war a year later would plunge the world into recession as oil prices quadrupled. The same happened again after the Iranian revolution 7 years later, which, combined with strict monetary policy plunged the UK into deep recession and mass unemployment (reaching 4 million at one stage). Another miner’s strike, this lasting just under a year, was finally defeated by the government of the time, who had cut taxes and deregulated the stock market ushering in a surge in share prices, which promptly collapsed on ‘Black Monday’ (a day that coincided with a hurricane sweeping across southern England, which closed our school for the day – I was now a teacher). The resultant interest cuts forged a strong recovery which only resulted in a deep recession in 1991. The UK had suffered through 3 major recessions in 20 years, one every 7. I taught this as an economic rule – a recession every 7 years.

By then I had moved to Singapore, which was enjoying two decades of non stop double digit GDP growth. I moved to Perth, Western Australia, just as the Asian economic crisis hit in 1997.

[If you, dear reader, see my exit just prior to these two recessions as anything but pure coincidence, please be assured I am not writing this post from my own island.]

And so to Australia, whose last recession was in 1991. 25 years of continuous economic growth has seen the country become a confident and influential player on the world stage. The 12th largest economy, boasting some of the best places to live.

With budget season now behind us, the latest figures predict our economy will continue to grow for at least another 5 years (albeit slower at 2 to 2.5% a year), which will stretch our period of non stop growth to 3 decades. Quite an achievement.

No doubt people will argue about whether we have invested this growth correctly, have built the infrastructure and society we want, which looks after as many as it can, and allows families to live in peace, and prosper. Some have got richer than others. 105,000 people still live on the streets, homeless. It’s not perfect by any means.

Government budgets are in deficit as the ‘mining boom’ ended and built-in spending programs have persisted. Billions of dollars of government spending cuts are blocked in the Senate (hence the double dissolution election coming up), and surpluses are many years away. Federal government debt has risen to just under 40% of GDP (in WA, state government debt has blown out to $40b or almost 100% of WA GDP).

Taxes in Australia are about the same as in other developed countries, but are more slanted towards direct (income and profit tax) than indirect (GST, taxes on cars, alcohol and cigarettes).

Meanwhile inflation is negligible and predicted to stay around 1%. The most recent quarter, it even went negative (hence the recent cut in interest rates to a record low of 1.75%). Interest rates could go to 1.5% later in the year, or even next month.

Unemployment is around 5.5-6%, and may rise a little more, but is unlikely to go much higher. A threat of a recession is small (we’d need something in excess of 8.5% unemployment for that).

Many WA businesses are feeling the pinch, and have been so for about 3 years. The real estate market has gone nowhere, and is still oversupplied in terms of the number of properties for sale or rent. Population growth in WA has slowed as those that came here for the ‘mine building’ boom have returned home.

Most people and businesses have ‘got used’ to the new normal of 2016. It’s no longer 2012, or 2006. The drag from mining and commodity prices is easing. Other industries are showing brighter signs, and everything feels a little more steady, if cautious. You have to work harder now for every dollar, every deal. [This is where the good sales people and good businesses prosper.]

Much depends on China. If China continues to grow, at 5% or 7% or even more, then what China wants, WA has. The US economy has improved, and the UK is one of the strongest in Europe. A few possible speed bumps are spread out in front of us: the threat of a ‘Brexit‘ and the election of Donald Trump to the US Presidency. Both these, and especially the latter, have grave consequences for world growth. And, make no mistake, we all live in the same world. While the chances of both happening are less than 50%, they are not zero by any means.

For now then, it looks like Australia will continue to grow, almost inexorably onward. It’s blue skies over the Great Southern Land…