FitLinxx

San Francisco

03.24.00

Hen scratches @ 37,000 feet …

Microsoft = R.O.W.

Microsoft > GM + Ford + Boeing + Lockheed Martin + Deere + Caterpillar + USX + Weyerhaeuser + Union Pacific + Kodak + Sears + Marriott + Safeway + KelloggSource: Business Week data through 5-99

Microsoft = R.O.W. (II)

Microsoft > GM + Ford Boeing + Lockheed

Martin + Deere + Caterpillar + USX + Weyerhaeuser + Union Pacific + Kodak + Sears + Marriott + Safeway + Kellogg

+ McDonald’s + Bank One + General Mills + American Airlines + United Airlines + + Delta Air Lines + US Airways + Quaker OatsSource: Yastrow Marketing (through 11-23-99)

No Wiggle Room!

“Incrementalism is innovation’s worst

enemy.” Nicholas Negroponte

Just Say No …

“I don’t intend to be known as the ‘King of the

Tinkerers.’ ”CEO, large financial services company

(New York, 5-99)

“It means nothing less than the total

reinvention of this company.”

Jacques’ New New Ford

Ford + MSN CarPointFord + Yahoo!Ford + Oracle

Ford + HP/MCIWorldcomEtc.Etc.

“There is probably going to be more confusion in

the business world in the next decade than there has been in any decade

in history.”Steve Case (2-00)

“We are in a

brawl with no rules.”

Paul Allaire

S.A.V.

“Steve Ross had a wonderful philosophy: People get fired for

not making mistakes.”Bob Pittman

Forget > Learn

“The problem is never how to get new, innovative thoughts into your mind, but how to get old ones out.”

Dee Hock

C.E.O. to

C.D.O.

“Reward excellent failures. Punish

mediocre successes.”

Phil Daniels, Sydney exec

“You really got to me. So many of our information technology projects take on a life of their own, and I know they’ll never end up as more than ‘mediocre successes.’ ”

CEO, F100 financial services company (10-98)

Kaiser: 4.15.29

Liberty Ship

2 years

240 days

9 hours

4 days, 15 hours, 29 minutes

“Every project we take on starts with a question:

How can we do what’s never been done

before?”Stuart Hornery, CEO, Lend Lease

“Astonish me!” / S.D.

“Build something great!” / H.Y.

“Immortal!” / D.O.

The greatest dangerfor most of us

is not that our aim istoo high

and we miss it,but that it is

too lowand we reach it.

Michelangelo

“I don’t think there’s anything worse than being

ordinary.”American Beauty

1) Turn ignition key.2) Shift into drive.

3) Press foot firmly on the throat of mediocrity.

Source: Mercedes ad

Issue Y2K

The Great War for Talent!

“The leaders of Great Groups love talent and know where to find it. They revel in the talent of others.” Warren Bennis & Patricia Ward Biederman

The NAESP …

Attributes of Those Who “Made” the 10th Grade History Book

–Committed!–Determined to make a difference!–Focused!–Passionate! –Irrational about their life’s project!–Ahead of their time / Paradigm

busters!–Impatient! / Action Obsessed

Attributes of Those Who “Made” the 10th Grade

History Book –Made lots of people mad!

–Flouted the chain of command!

–Creative / Quirky / Peculiar! / Rebels! / Irreverent!

–Masters of improv / Thrive on chaos / Exploit chaos!

Attributes of Those Who “Made” the 10th Grade History Book

–Forgiveness > Permission

–Bone honest!

–Flawed as the dickens!

– “In touch” with their followers’ aspirations

–Damn good at what they do!

Just Say “No” to “Grout”!

Participant: “Don’t you need ‘grout’ between the tiles?”

TP: “No!” [med staff, NFL Special Teams,waiters,

PFCs, cymbals player, bit parts, waiters]

TP’s Ideal Job:

Head of Housekeeping!

Talent = Brand

Brand Outside=

Brand Inside

Quality Not Enough!

“While everything may be better, it is also increasingly

the same.”

Paul Goldberger on retail, “The Sameness of Things,” The New York Times

“The ‘surplus society’ has a surplus of similar companies, employing similar

people, with similar educational backgrounds, coming up with similar ideas, producing similar things, with similar prices and similar quality.”

Kjell Nordstrom and Jonas Ridderstrale, Funky Business

The “10X/10X Phenomenon”

10 Times Better/

10 Times Less Different

“When we did it ‘right’ it was still pretty

ordinary.”

Barry Gibbons on

“Nightmare No. 1”

Pretzel Crumb-less-ness Plus …

“The Ritz Carlton Experience enlivens the senses, instills

well-being and fulfills even the unexpressed wishes and needs of

the guest.”

from the Ritz Carlton Credo

“You do not merely want to be the best of the best. You

want to be considered the only ones who do

what you do.”

Jerry Garcia

Nirvana!

- Nordstrom- Four Seasons

- Adirondack Guide Boat- OXO

- Ziplocs

Why?

Cool!/Surprising!Reliable!

Friendly!/Comfortable!Aesthetically pleasing!

TP’s “Mega-marketing-trends”

Rapidly aging population!Health fanaticism!

Environmental concerns!Freaky independence!

Women rule!

Brand Outside

Strategy 1:

Lead the Customer!

“Wealth in this new regime flows directly from innovation, not

optimization. That is, wealth is not gained by perfecting the known,

but by imperfectly seizing the unknown.”

Kevin Kelly, New Rules for the New Economy

Amen!

“The Age of the Never Satisfied

Customer”Regis McKenna

Brand Outside

Strategy 2:

Use E-Commerce to Re-invent the

Business!

$35,000,000. = ???

Dell’s Web sales … daily

[AOL delivers more mail than

the USPS!

Source: Fortune 2-00]

2X = 100 days (Internet traffic)

2X = 9 months (network capacity)

Source: Red Herring (1-00)

I-24 to 1-28: BizRate.com Online Shopping Index [Consumer Goods]

52 Weeks: +622%

Source: The Industry Standard/02-00

Time to 50M Users

Radio … 38 years TV … 13 years PC … 16 years

Internet … 4 years

Source: Business 2.0 [01-00]

Tomorrow Today: Cisco!

$7B of $10BSave $500M (service and tech

support)

C.Sat e >> C.Sat HCustomer Engineer Chat Rooms ($1B?)

W.W. Grainger*

2X phone/fax

*$220B “MRO” market (per Business 2.0/02-00)

Consumer [Health Care] Sovereignty!* E.g.:

“Empowered consumers influenced by medical advertising and educated by

information on the Internet are driving demand for new vision correction

options.”

Start Up (10-99)

* “Take your White Coat and … ”

SoftWatch (MS)“Manage relationships across the

healthcare continuum”/ Amir Kishon

Establish e-relationships with customers/retain customers/collect data

Patients record info + receive feedback/ Online access to nurses

Community with others with MS

Etc.Source: Start-Up

Welcome to

D.I.Y. Nation!“Changes in business processes will emphasize self service. Your costs as

a business go down and

perceived service goes up because customers are conducting it

themselves.” Ray Lane, Oracle

“Autoweb. Take the Wheel.”- Advertising Age

Psych 101: Strongest Force on Earth?

My need to be in perceived control of

my universe!

Swissair

e>bookinge>ticket

e>check-ine>tracke>info

Anne Busquet/ American Express

Not: “Age of the Internet”

Is: “Age of Customer Control”

I am a cynic …

I am a skeptic* …

* Just ask NKA

I am in love …

… with FitLinxx

Self-control = Engagement = Effectiveness*

* “How Pilots Fly the Plane Varies a Lot from Airline to Airline” (WSJ/031400);

PD on mbo

“Where does the Internet rank in priority?

It’s No. 1, 2, 3, and 4.” Jack Welch

“In the network economy, the Website becomes the company’s primary interface to the customer.

The user interface becomes the marketing materials, store front,

store interior, sales staff and post-sales support all rolled into one.”

Jakob Nielsen, Designing Web Usability

There are 2 Kinds of …

Defense*

vs.

Offense**

*Fend off upstarts.**Reinvent our marketspace!

RR on Sara Lee

“The most profitable businesses in the future will act as knowledge brokers, linking insights into what’s available

with insights into the customer’s individual needs

and preferences.”

Brand Outside

Strategy 3:

Women Rule!

?????????

Home Furnishings … 94%Vacations … 92%

Houses … 91%Bank Account … 89%

Health Care … 75%Etc.

48% working wives > 50%80% checks

61% bills53% stock (mutual fund boom)

43% > $500K95% financial decisions/

29% single handed

Women … 49% of Web users; 6 of 10 new users; 83% of wired women are primary decision makers for family healthcare,

finances, education.

Source: Business Week (11-99)

$3.3T + $1.5T = $4.8T*

* Larger than Japan!

New golfers … 37%Basketball … 13.5M

1 in 27 (’70) … 1 in 3 (’96)

1874?

1874 … Jock Strap1977 … Jogbra

1977 ... 25K

1996 … 42M

Yeow!

1970 … 1%

2000 … 50%

OPPORTUNITY

NO. 1!*

[* No shit!]

Carol Gilligan/ In a Different Voice

Men: Get away from authority, familyWomen: Connect

Men: Self-orientedWomen: Other-oriented

Men: RightsWomen: Responsibilities

FemaleThink/ Popcorn

“Men and women don’t think the same way, don’t communicate the same

way, don’t buy for the same reasons.

“He simply wants the transaction to take place. She’s interested in creating a relationship. Every place women go,

they make connections.”

How Many Gigs You Got, Man?

“Hard to believe … Different criteria”

“Every research study we’ve done indicates that women really care about the relationship with their

vendor.”

Robin Sternbergh/ IBM

Not a Morality Play!

“It is critical that we all understand that IBM is not marketing to women

entrepreneurs because it is the thing to do, or even the right thing to do.

We are marketing to women entrepreneurs because it is a huge

opportunity.”

Cherie Piebes

Speaking of Enormous

[Missed] [Huge] Opportunities ...

74/55

“At each stage of their lives, the needs and desires of the baby

boomers have become the dominant concerns of American business and popular culture. If you can anticipate

the movement of the baby-boom generation’s life-span migration, you

can see the future.”Ken Dychtwald, Age Wave

Aging/“Elderly”

2X growth rate$$$$$$$$$$$$

“I’m in charge!”“Experiences” vs. Products

Design revolution!

Good source: Ken Dychtwald, Age Wave

Priorities: Aging/“Elderly”

Experiences … Convenience … Comfort

… Access … Respect!

“Any student who combines an expertise in gerontology with, say, an M.B.A. or law degree will

have a license to print money.”

Newsweek

1965: “ ‘Doctor’ will see you now. ‘Doctor’ will take care of you.”

YES, NURSE. ME GOOD PUPPY DOG.

1995: “HMO will take care of you.”

BULLSHIT.

2005: “I will take care of me. I’d like your expert help.”

P.S.: THE VIAGRA [ETC.] I ORDERED ON LINE IS GREAT.

Patient-centric* Health Care

Wellness (Fix to prevent.)

Partnership (“Tour guide” model.)

RESPECT! (Mutual.)

WOMEN RULE!

*Not: HMO-centric, Employer-centric, Insurer-centric, Doc-centric

AMA: Push “Patient

Partnership” Model????

Brand Outside

Strategy 5:

It’s the Experience!

“Experiences are as distinct from services as services are from

goods.”Joseph Pine & James Gilmore, The

Experience Economy: Work Is Theatre & Every Business a Stage

“The [Starbucks] Fix” Is on …

“We have identified a ‘third place.’ And I really believe that sets us apart. The third place is

that place that’s not work or home. It’s the place our

customers come for refuge.”Nancy Orsolini, District Manager

Safe, On Time and …

“We defined personality as a market niche. We seek to

amuse, to surprise, to entertain.”

Herb Kelleher, Main Man, LUV Airlines

Experience: “Rebel Lifestyle!”

“What we sell is the ability for a 43-year-old accountant to dress in black leather, ride through small towns and have people be afraid

of him.”

Harley exec, quoted in Results-based Leadership

Mantra: “Any good can be ing-ed”

the driving experiencethe pumping experience

the sitting experiencethe reading experiencethe washing experiencethe cooking experience

Joseph Pine & James Gilmore, The Experience Economy: Work Is Theatre & Every Business a Stage

“This is the end of the pure product era. For instance, car

makers are beginning to understand that the car is a

platform for delivering services that drive the customer

experience.”Carly Fiorina, HP @ Comdex ’99

Brand Outside

BRAND POWER!

Brand It! Now, More Than Ever!

“The increasing difficulty in differentiating between products and

the speed with which competitors take

up innovations will assist in the rise and rise of the brand.”

Gillian Law and Nick Grant, Management [New Zealand]

Brand = You Must Care!

“Success means never letting the competition define you. Instead you have to define

yourself based on a point of view you care deeply about.”

Tom Chappell, Tom’s of Maine

Brand = Special = Passion =

Connection = Caring*

* (Way) beyond “market research”

Rules of “Radical Marketing”

Love + Respect Your Customers!Hire only Passionate Missionaries!Create a Community of Customers!

Celebrate Craziness!Be insanely True to the Brand!

Sam Hill & Glenn Rifkin, Radical Marketing (e.g., Harley, Virgin, The Dead, HBS, NBA)

Brand Leadership!

“A key – perhaps the key – to leadership is the effective

communication of a story.”

Howard Gardner Leading Minds: An Anatomy of Leadership

“If you ask me what I have come to do in this world, I

who am an artist, I will reply, I am here to live my

life out loud.”Emile Zola

“If things seem under control, you’re just

not going fast enough.”

Mario Andretti