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Kevin Smith

One of the best account planners in the business, Kevin is an Ad Guy who brings experience, passion and insight to every initiative. He first joined the firm in 1994, spent five years on Madison Avenue, then returned to Riggs Partners in 2004.
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posted by Kevin Smith Mar 23,2016 @ 05:29PM

Your Core Business is not Enough

If work seems more difficult than ever, you are not alone. So many businesses are at a breaking point. Culprits often include a vicious combination of technology, commoditization and sustainability. Competition’s newest cure is to refine your business model. The common truth when rethinking how to best compete is this: Whatever business you are in, your core business is not enough.

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I’ve seen this new business reality drive mergers and acquisitions. It is also changing how companies approach human resources. And both of these shifts are occurring at an increasingly rapid rate. Here are three industries that are feeling the impact in dramatic ways.

The pulp and paper industry is being impacted by technology. A shift in demand is occurring from paper to packaging. The industry is consolidating and mergers and acquisitions abound. Selling papermaking equipment is not enough anymore. The leading players are educating their client’s workforce, servicing the equipment onsite and consulting on optimizing operational efficiency.

Construction services have been commoditized. A study of client with projects greater than $20,000,000 yielded the following insight: “Anybody can build a building.” Specialization used to win business. “Building a hospital? Nobody’s built more than we have” is no longer adequate. The construction companies that can help their clients plan more effectively before construction starts or operate more efficiently after the building has been built will be the winners in 2016 and beyond.

We all know the current economics of healthcare is unsustainable. Today’s hospitals were designed mostly for acute care. Doctors are trained in the science of treating disease. To meet the economic needs of the nation and to effectively care for an aging population, healthcare providers will have to be in the business of keeping people healthy not simply treating them when they are sick. Functional medicine pioneer Dr. Mark Hymen calls this a systems approach to medicine. Hospitals that adopt this philosophy will be in the business of connecting people with a healthier way of life. This is well beyond opening a community wellness center. It is a fundamental shift in mentality.

While some of these pivots are more dramatic than others, none will be easy. Mergers and acquisitions demand structural changes of organizations, cultural integration and strategic shifts in communication. Developing personnel and new product offerings can sometimes present an equally demanding task. If you are feeling overwhelmed you are far from the exception. 

The ideal place to start is by beginning a dialogue with your customers. I recommend scheduling a thirty-minute phone call with a half-dozen customers. Choose people you wish you could replicate as clients. Develop a list of questions that probe how they came to choose you. Try and uncover unmet needs, threats to their business success, and any frustrations they may have. Make the calls or hire someone outside your organization to make them for you.

In doing this, I believe the following will happen. First, you’ll be shocked at how willing people are to share their experience with you. They’ll be flattered you asked and feel valued as a customer. More importantly, you’ll likely be much better informed about how your business needs to evolve. This exercise offers clarity and valuable outside perspective. With clarity, operational and communications shifts are far more palatable.

posted by Kevin Smith Oct 28,2015 @ 08:00AM

How We Spend Money

1920s: We outspent ourselves.

1930s: Then we spent nothing.

1940s: We spent only when necessary.

1950s - 1980s: After that, we spent as instructed.

1990s - 2008: We outspent ourselves -- again.

2008 -  2010: Then we spent nothing.

It may have been a cycle, but it isn’t anymore. It’s not that “this time is different.” Every time has been different to a degree. I don’t believe we are in the midst of a modest recovery that will ultimately culminate in another glory decade or two.

I believe the next phase is: “We started caring how we spent.”

The number of brands connected to causes or giving back or being more sustainable is growing by the minute. That’s a trend. I hope it continues. But there is a broader and likely more permanent business context.

Companies that articulate and demonstrate a clear purpose are succeeding. Some might be charitable in nature, but this is not a prerequisite. Given pervasive marketing, given that we are all time-starved and attention-impaired, consumers are choosing to spend money with companies that demonstrate clarity.

Kick Starter announced last week that it will not sell or go public – ever. They are committed to helping fund creative projects, and see reporting to shareholders as a potential distraction to that end. Southwest has held true to its mission of democratizing the air, and stands by the slogan: “bags fly free.” Meanwhile, CVS made the decision to focus on its customers’ health and stop selling tobacco products. As I write this, several of our local network affiliates are providing uninterrupted coverage of Columbia’s tragic flood. They’ve decided to focus on their primary purpose as an affiliate – reporting local news.

This is not marketing, but purpose-based decision making. This is leadership. Clear business decisions driven by a company’s mission and core values. These decisions may at first seem counter intuitive, but they provide clarity both internally and externally. The outcome is loyalty and profit.

Our marketplace has never been more crowded and communication channels have never been more fragmented. Most marketing programs have become a scattershot of tactics. In this environment, purpose and the clarity it yields brings customers in the door and keeps them coming back.

A recent Gallup poll found that only 28 percent of employees strongly agree with the statement "I know what my company stands for and what makes our brand(s) different from our competitors." The same poll found that when customers can see alignment between a company’s purpose and its behavior, they give it twice the share of wallet.

Given this dynamic, I am shocked at how few companies have a clear sense of purpose. Mission statements and core values abound, but they are most often anything substantive. If one of your company’s core values includes integrity, this most likely includes you. Basic honesty is not a core value. Being “best in class” or “providing excellence” is not a mission. A committee of employees assigned to work on the mission statement typically leads to general platitudes on which everyone can agree. Unfortunately, committees rarely offer organizational clarity or existential intent.

Ask instead: Why were we created? What would be lost if we were gone? You and your coworkers have to know why you show up each day, beyond making money. In doing so, I believe you’ll make a whole lot more of it. 

posted by Kevin Smith Sep 30,2015 @ 08:00AM

Technology and Your Business - Preparing for Major Changes

Our state and nation’s social problems are nothing new. Thankfully, government, nonprofits and social enterprises have been working to address all manner of public need for years. Their efforts have often been heroic and their scale has been vast. South Carolina now has more than 8,000 organizations committed to the complex societal concerns facing so many of our citizens.

Despite the involvement of so many well-intentioned people and organizations, many issues are getting worse instead of better. Unfortunately, I believe this trend is going to further accelerate, and in a way that will impact your business. Navigating the changes ahead will require an unprecedented sense of organizational purpose and clarity of communication.

The Backdrop

Household income has been basically flat for five decades. The gap between rich and poor has increased dramatically since the 1970s. Meanwhile, multi-generational poverty remains unchecked.

There are victories here and there, and businesses are doing what they can through grants, volunteerism and board service. What is about to be hugely relevant is technology’s impact on our state’s population.

Thus far, technological improvements have had the most substantial impact on those at the top of the economic pyramid. Corporations have been able to harness technology to improve efficiencies and their bottom lines. Take automated airport check-in for example. The airline saves money on personnel and bolsters their bottom-line. This change might not be good for the displaced airline’s employee, but it is good for the shareholder. Nevertheless, the impact is not yet far reaching.

The Reality

More wholesale change is coming. We’re only a few years from vehicles that drive us. What will that mean for the 3.5 million truck drivers in America? Robots will soon be stocking supermarket shelves in addition to checking out our groceries. Diners are using electronic kiosks to place orders at casual dining restaurants. Both blue and white-collar workers will be affected. There is now software drafting legal documents instead of lawyers.

In short order, many low and middle-income jobs are going to be eliminated, and the pace with which these technologies are approaching is quickening. The industrial revolution moved the laborer from the farm to the factory. The knowledge economy moved the worker from the factory to a desk. This time, some believe the next destination will be unemployment.

Former American treasury secretary, Larry Summers, noted that in the 1960s one in 20 men ages 25-54 was unemployed. In ten years, it could be one in seven. So unless you own a Bentley dealership, this is going to impact your business.

The Opportunity

Where there is chaos, there is opportunity. I believe that what will emerge is the creative economy.

In this economy, organizations that thrive will have two things in common:

  1. Purpose: They will have absolute clarity about why they exist and the impact they intend to have on the world around them.
  2. Positioning: They will be able to communicate clearly and succinctly the unmet need they fulfill and how they do so differently.

These concepts are not new, but they will be more essential than ever. Purpose and positioning demand that businesses assess the core business they are in, how they deliver their product or service, and the degree to which they fulfill an unmet need.

If you are in a commodity business that caters to the middle or lower-income customers, the impact will be more substantial. Evaluating your purpose and positioning will prove key to a sustainable business model. Those who identify and address newly unmet needs will lead the creative economy.

Nonprofits will see the need for their services increase while their donor base declines. This will demand more efficient back-office, service and delivery systems, likely leading to mergers. Increased competition for donors will require more intentional marketing and brand positioning. The best communicators will be the most sustainable organizations. In short, the nonprofits will learn to invest in themselves and behave more like for profit businesses.

While few would say they are eager for such changes, they are coming. Preparing your business earlier can only make the path ahead easier. It is time for each of us to up our game.

 

This post originally appeared as a column in Columbia Regional Business Report.

posted by Kevin Smith Apr 22,2015 @ 10:39AM

Trying to Keep Up

Riggs_suitEarlier this month, Media Post published an interesting article about how as we age, the brain moves to the right. Specifically, the brain perceives reality in sensory images and like metaphors. I was excited to be informed that: “Stories generally do a better job of emotionally engaging Baby Boomer minds. In fact, Baby Boomers are more likely than younger consumers to ignore a message that simply describes a product with little or no affect.”

Shortly thereafter, I read in Marketing News: “Digital Disruption and the Death of Storytelling.” Douglas Rushkoff’s views are profound. He reminds us that digital devices leave us living in a reactionary mode, failing to plan for the future or live fully in the present. The multitude of communication channels has rendered even the most centered among us compulsive and compromised.

These two interesting and compelling viewpoints remind me of how confusing the deluge of information we receive can be. In this new age of information, we want absolutes, new rules and decrees we can employ.

It’s simply not that simple. The only thing we can truly be expert at is asking questions of our customers. The modern marketing tumult has made listening the most important art of all. Marketing has no templates because consumers are custom made. Informing an audience to make wise decisions requires an expert tailor with a penchant for hearing others’ truths.

posted by Kevin Smith Mar 17,2015 @ 10:10AM

The Power of No

Guinness, the iconic brand of Irish stout launched a blonde lager brewed in America. The brand’s roots date from 1759, the tone of its witty advertising initiated in 1794 and the “Guinness is good for you” tag line is over 80 years old.

I believe one of the most powerful brands in the world has just sacrificed itself at the altar of more. Sadly, we see it all the time. No brand wants to inhibit growth; therefore, no company wants to exclude a potential customer.

To Guinness, finding any way to increase sales in the US trumped its heritage, product niche and brand equity.

We believe that sometimes, companies need to say no. That means knowing:
a) What you stand for
b) The value of your brand
c) What you are unwilling to do

Guinness will likely have some success with its US blonde lager. In the short term, it may even prove a good move. Long term, my bet is that they’ll regret it. Riggs Partners believes in longevity, being true to yourself, and being true to your customer. If you’re struggling with short-term gain versus long-term value, give us a call.

 

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