Winter, wood and wool coats

It's getting colder. Jackets thicken while energy bills rise.

That's winter in Canada. Every year it comes and every year, I dread it. But it comes and I know it.

Dad was recently hospitalized with some respiratory problems. While visiting, he told me he didn't have his wood cut yet. This little setback was going to be a problem. It's his main source of heat for survival.

Come to find out, dad wasn't talking about this winter. He was talking about next winter. He's preparing for 12 months ahead of time.

Not all of us plan that far ahead.

Forget about winter and wood and wool coats.
Have you planned out your next 12 month marketing plan?
Do you know what road you're going to use and what kind of car is going to get you there?

January is still a month away but planning can be done any time. Don't wait until the new year to decide what's next.

Formulate your strategic direction. Understand what can take you there. And in the wise words of Larry the Cable Guy, "Git r done".

Someone asked me this morning, "Given the uncertainty of the economy, is it a good time to be in business".

The best time to be in business was 10 years ago. The second best time is today. Do you want to know when the third best time is going to be?

Get the jacket on. Warm up, snuggle next to the fire. Boil a cup of cocoa. And know where you're driving this business of yours.

It's easy to get wrapped up in the day to day grind.
It's easy to delay planning in exchange for doing.

You know as well as anyone, the easy stuff doesn't get the best results.
Do the hard thing. Steven Covey called it, "Move the big rocks" in his book "7 Habits of Highly Effective People".

Strategy is a big rock.

But here's the bad news.
You can't do the strategy on your own.
You're too close to it.
You're biased.
If you try to do it, it will be watered down, ineffective and a waste of money.

This isn't a sales pitch. I don't need your business.

Just trying to help out a friend in need.

I'll give you my jacket if you really need one and can't afford it.
In my experience, you'd complain about the colour and would toss it away after the first week, if I gave it to you.

A discount retailer hurts no one but himself.

As Black Friday approaches, I was thinking about my Canadian retail friends. Black Friday wasn't even a thing in Canada seven years ago. Canadian Thanksgiving is in October.

The Canadian retailers decided they needed a new reason to throw an event at its shoppers so they followed their American cousins into the Black Friday frenzy.

Just another reason to give a discount to get more sales. It's kinda funny. Canadians don't get a Thursday vacation.

My friend Bruce owns five pizza restaurants. He believes customers only come to him because of his flyers. So he runs a flyer every three weeks. He'd do them every week but he can't afford the shipping costs.

The pizza business is notorious for this type of behaviour. Once upon a time I used to work for a pizza chain. We did the same things to keep franchisees and the top brass happy.

Even 15 years ago my gut didn't feel good about it.

Here's what happened, eventually the marketing effort fizzled out. It chased the transactional customer, who wanted the best price. At that time, we had two people answering phones at a restaurant on a Friday night. Two people to handle all the calls.

Do you know what the number one question was?
Yep, you got it. "What's your special?"

Some customers ordered after hearing the specials while others promised to call back. We have no idea if they did.

Bruce doesn't understand the difference between a transactional customer and a relational one. He's dehydrating in the desert, and he doesn't realize there is a cooler filled with fresh water to his left.

He thinks the easiest path to sales growth is chasing these low margin, fickle customers who only want the best price.

I order six pizzas from Bruce's restaurant every four weeks for a gathering of friends. The first time I ordered, they gave me a $40 discount. I didn't ask for it. Didn't know about it. Didn't need it. But do you think I took it?

Of course. I like money. You wanna give it to me? I'll take it.
The interesting thing is the second time I ordered the same six pizzas, I expected the discount. If it wouldn't have been there, I may have asked for it.

He converted a loyal, relational customer into a transactional one at his own expense.

Bruce knows the restaurant business. But he doesn't understand marketing. He thinks he does so I can't explain it to him. Bruce believes in these short term sales tactics.

I can't change his mind. I've given up trying.

I've seen this re-run before. Hell, I was in it.

I was thinking of Bruce while visiting a Factory Outlet store in San Marcos, just outside of Austin, Texas.

There were Bruce's everywhere. 60% off. Buy one, get one Free. Buy one, get one half price. The parking lots were full and customers were buying stuff. Looked like a good day for business.

There was one store that wasn't promoting discounts. Bruce could never work at this store.

It was the only one that had a line outside. Security had to manage the customers wanting to get a glimpse inside. No discounts. Business looked good here too.

It wasn't pizza. It was her Italian cousin: Gucci.

The pizza industry has converted itself into a commodity. It's like wheat, or salt. The prices continue to drop. A special we used to offer at the pizza chain 15 years ago has only gone up by $3.00. Inflation has gone up by more than that. The only way to make a living selling pizza is to sell a lot of them.

I'm not saying pizza has to be like Gucci. They can play a different pricing strategy and not get wrapped up in the highly competitive pricing wars.

The next time you run a sale to attract a customer, think about your marketing strategy.

This approach is hurting your longterm brand, unless you're moving old inventory or perishable stock. If you got lucky and you bought a couple of shipping containers at a discount and you want to pass savings onto your customers, that's ok too.

Just remember, a discount retailer hurts no one but himself. And if you're not sure, ask Walmart. They closed 269 stores in 2016 and just announced another 22 closures for North America in 2019.


Rick Nicholson is a multi unit business owner and partner at Wizard of Ads. He looks at marketing from the perspective of relationships, corporate beliefs and most importantly its effect on sales. If you want to know how he can help you, you can reach him at ricknicholson@wizardofads.com.

Secret of success, go after your opportunity, and five levels of respect

My eyes lifted from the computer screen to see an old friend walking to the counter to order a coffee. As he sees me, he motions that he'll be right over.

He noticed me, my insecure self whispers.

Of course he noticed you, my confident self affirms.

Nonetheless, my old friend is a professional athlete who is on national television no less than 75 times per year. He moved away many years ago. 

As he comes over to say hi, I didn't know what to say to him. I've watched him rise to be one of the best in his profession. 

I have to tell you that I brag to my son that I know you.

Haha, I'm still the same guy.

Tell me something, what's the secret to your success?

Oh I had a lot of people helping me, coaching me and pushing me to be better.

That's the bullshit answer you give the media. Tell me the real reason.

Opportunity presented itself and I went after it.

Do you ever pinch yourself that you're in a dream? You're out there with some of the greatest household names in your sport.

At first, maybe. But I'm not in awe of anyone out there, not even the superstars.

How do you do it?

It's all mental. We have psychologists we work with to keep our minds sharp. I go out everyday to be the best I can be. I can't worry about anyone else. There's one guy who makes $5 million dollars a year. He's the biggest jerk in the league. He likes to mouth off, looking for a reaction from me.

So what do you do?

I smile and tell him that a guy making that much money should be happier and quieter.

That's funny. Do you love what you are doing?

I do. But it's a job. In the beginning, I had to pinch myself to realize that I had made it. Now, it's about routine, flying and working. Last year, I flew 160 times all over North America. I live in airports and hotels. It's not ideal, but I know I'm really lucky to be where I am.

Any regrets?

I wish I could live here and still do my job. But opportunity is elsewhere and I have to go where it is.

That's great advice. Go where the opportunity is. My son said he wants to be a professional athlete. I've told him that nothing is free. He has to work for it. If he was your son, what would you say to him?
I would tell him to never give up. To work hard, but always understand there are 1500 people who compete daily for the same job that he wants. 10% are superstars with above average skill in the league. The other 90% are all about the same in the skill department. The difference between those who make it and those who don't is between their ears.

Attitude?
More than attitude. Respect.

Respect?
Respect for self, for the team, for the coach, for the league and ultimately for the game. The person who respects the five levels and has comparable skills is the guy who becomes the professional athlete.

That's great advice. Thanks for stopping by.
No problem. I've got a tee time in 15 minutes. I gotta go. See you later.