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The Answer


ROI by Frank J. Rich







By Frank J. Rich




Let’s all cheer for … the lottery? In a game of pitch and toss, each hurling is an all-in bet. Win and join the few that can rise above the first person singular and not lose their good judgment and good sense in the use of the windfall (the odds of bankruptcy grow astronomically among lottery winners). Lose and join the multitudes of haters who wish only the squandering of winnings by winners. We are seldom made truly of good wishes for the good fortune of others.

Last year’s Powerball (at this time) at over $1.5 billion, the largest in its history, raises an interesting question. According to the parade of presidential candidates, and most others, the nation faces unparalleled social and economic challenges. Too few citizens are prepared to compete in a complex workplace, pay taxes, afford a home of their own, and enjoy savings greater than $15,000. To revive a slow economy (even though better than most), consumption must increase. This depends mightily on wage growth and consumer confidence in the economy—now and in the future.

Politicians speak of so many ways to answer the call; each branding his model of blaming others and naming the fulfillment that obtains by their handiwork. Oddly, this dance is perhaps the most reliable activity in each—past and present. Missing are real solutions to slow economic growth, a more competitive educational model, equal opportunity, and a trustworthy electorate. Until now!

Let’s solve all of these problems with a simple, sweeping solution that turns into prodigious policy. Follow the math.

Let’s turn the lottery toward the people and not the government. Why? Because the government has already shown it lacks the imagination, the will, and the courage to act on behalf of its citizenry, and primarily for its benefit. If every household were a winner, each week the lottery would turn into an annuity that delivered needed funds for many.

* More would play, knowing that their money would bring back more each week. Invest $2, get back $10. Everyone would be a winner, every week. A $10 billion a week lottery would be common.

* Those that don’t need the extra cash might return it to the lottery commission for distribution to those who do.

* The distribution of wealth would occur without the assistance of government—the marketplace would take its course.

* Consumption would increase as income rose.

* Economic confidence would rise, encouraging risk-taking enterprise.

* The electorate nationwide would work harder to add programs that returned more money to citizens for discretionary funding.

* People would feel connected to an economic system that brings attention to the opportunity to grow and prosper by their own steam, aided in some part by an economic catalyst that has their best interests in mind.

Take 1.5 billion, that’s $1,500,000,000 and divide it by the number of households in America—roughly 100 million. Then send 10 percent of “households” a pro rata share of the total lottery ticket sales. Let’s assume that lottery sales would average $2.5 billion each week, since every household would be a winner over a 10 week period, and then again over the next 10 weeks. $2,500,000,000/100,000,000 = $25, or $125 over the course of a year. A $10 billion lottery would deliver a $600 windfall each year to households, a $600,000,000 shot in the arm for local economies across the nation. Over the course of 10 years a total of $6,000,000,000 (billion) would be delivered into the hands of citizens, a flat distribution to those who need it or not. Just as the Bush Tax Rebate evidenced, many that do not need it would decline it in favor of those that do.

Let’s add the interest earned from America’s retirement funds. Its accumulation over just 2 years would relieve the national debt, according to research. The point: there are creative ways to assist and encourage America to regain its economic footing—and free market systems lead the way. A life well counted is made not of what we get, but what we give.

January 27, 2017 |

Winning the Customer, Part IV


ROI by Frank J. Rich







By Frank J. Rich



The essential element in the exchange between buyer and seller is the person. If we accept each means to express his wants, needs, and habits, no less than to present his identity and to form common ground, then getting to know the one paves the road to an appreciation of the other. Clearly, we are more impassioned of his work after we learn that Beethoven turned deaf while growing his legacy compositions. We also learned that the impediment was less a disability than thought; music is made of vibrating sound waves, and is easily felt. A “C” just sounds different than any other chord, or music would be the repetitive drone of an airplane in flight. Few would enjoy the likeness if applied to us.

It is said that “people don’t care what you know until they know that you care.” Thus, relationship derives from knowing how to enjoy another. This, in turn, requires that we work at it. Another saying: “To have a friend requires that you be one first.” So, vulnerability becomes virtue in this context. Despite the distance and formality of passersby, we feel better when the world reaches out to touch us. Walk up to me with friendship in your eyes, smile, and gait, and I’m likely to respond in kind.

The suggestions are no less the take-away from studies to determine the effect of such vulnerability on the buyer and the seller’s stock price. Admitting mistakes, misunderstandings, learned aspects of product and service to customers, or shortcomings that once accepted can improve customer offerings, etc., were consistently viewed by customers as motivation to select those who admitted their faults over those who hid them. Surprised?

We all know that the dark wind that swept over world economies in 2007 affected business. Fair enough. So, what did the enterprising do? They marched on, investing in the idea that if they did now what the competition refused to do, they would build a future in which the competition could not. Brilliant! It’s a well-worn growth model, but a scary thought in an uncertain moment. That said, when isn’t the market an uncertain reality?

When we excuse our slim inventory, constrained returns policy, price inflexibility, and limited services, though a poor economy can impose such terms on us, we may be revealing an inability to fix the problems we face. The position is not enviable, and most customers will find another to satisfy their needs. Every shop—physical or virtual—desires one thing first: to gather customers to them. This is when the magic begins—when we get to show our special brand of products, service offerings, engagement methods, and retention services. It may be the only moment we have to convince the customer he has found the right place to satisfy his needs. Indeed, to find the identity he seeks in all that he does.

We are never so attractive as when we make it possible for another to contribute to the fullness of our lives, and for us to contribute to theirs. We need only be receptive to encourage this joining. It begins with us, and the rewards are spectacular.



January 20, 2017 |

Winning the Customer, Part III


ROI by Frank J. Rich







By Frank J. Rich



The measure of pain and pleasure may be hidden currency, but these twin pedals of the human psyche are significant players in just about everything we do. As pleasure subsides we are often moved to pain. Equally, we are “moved” to pleasure as pain fades. Though we might not be aware of pleasure in the absence of pain, the level of pain reveals its equal number as it rises and falls. For example, when the first contact lens insertion brings pain, it diminishes by comparison to the pain with the insertion of the second, if also painful. Indeed, pain often determines steps forward or the caution that keeps you in place. Even imagined pain is real enough to keep the spirited from launching over a bridge with only a thick rubber band as insurance against certain destruction.

Not surprisingly, pain is the underpinning of the buying experience. As science (psychographic research) reveals, buyers are categorized by an identity with three groups: the unconflicted (those that are driven to spend by need or convenience, or average spender, 61%), the spendthrift (those with a higher threshold of pain for buying things, 15%), and the tightwad (those that spend less than the average before pain sets in, 24%). Each is a buying animal unto himself, but has in common with the others a pain threshold that moderates his willingness to buy. Learning each buyer’s pain threshold is key to growing sales, especially in a competitive market.

How then do sellers approach each group, and what might they expect in return? The answer is simple in concept but requires the creative resources and the energy to keep at it. The rewards can be significant. Value models, product bundling, and making little things big to the buyer is the trifecta that makes money flow and conditions buyers for greater satisfaction. Importantly, this is not to suggest that sellers manipulate buyers. Make that mistake and you’ll turn potential customers into the “fourth kind,” those that tell everyone they know to stay away from you. It’s the customer of the “third kind” that you seek; the one that becomes an extension of your marketing efforts.

“Value models” restate the price of items, making them appear to be more available. An item costing $2,500, such as furniture today, when offered without payment for one year and no interest, makes new furniture an easy decision. Monthly payments, term discounts, and volume “breaks” all work to chase away the pain in buying. $199/month over three years for a $24,000 car is an extraordinary value, affordable, and easy to assume for most. It’s what has transformed the auto industry. More cars and much greater profits from each car are the results.

Bundling products only makes good sense. Discrete sales are “one-and-dones”; death to NFL football fans. I have a lighted pin oak tree on my property. It’s just beautiful; it makes the neighbors and my wife and I just feel good when we see it lighting up the neighborhood. Landscape lighting is so striking, so when the Volt Lighting Company saw me shopping for it they immediately interrupted my review of the selected product to present photos of what a complete garden or house looks like when graced by their amazing accent lights—and for a package price that saved me lots over single purchase items. It was pure magic. I bought them. Now, every evening I look out the windows of our home I feel good inside when taking in that beautiful pin oak tree in glorious white lights. If this were not the way to raise buyers’ pain threshold, why would the largest store in the world—,com—present you with complementary products just before checkout? Ever bought an LED flashlight you didn’t need because the checkout clerk at Home Depot told you that it was reduced for those who bought camping equipment?

Making “little things big” forms an attitude and understanding of the way we respond to words and the senses. When we use words such as only, merely, affordable, small, just, etc., we are giving the buyer the structure we talked about in Part ll of this series. They give the sense that your product is more affordable, that anyone can enjoy it, and that obstacles fade away. Studies show that the addition of diminutive adverbs, such as those above, increased the response rate in “tightwads” by 20 percent. Instead of 20 customers, you would have 25. In the sale of a $25,000 car with a 10 percent margin, that means a windfall of $12,500. Who would turn away a 20 percent spike in revenue and profit?

The examples above only scratch the surface. Creative minds and a little research will deliver many more ways to add sales and profit to your business, and delighted customers too. We are all looking for ourselves in everything we do. Help another find himself in your product, service, or unique approach to buying turns sellers into the much-coveted “assistant buyer.” Get into the game; you’ll be glad you did.



January 13, 2017 |

Winning the Customer, Part II


ROI by Frank J. Rich







By Frank J. Rich



Few would argue that children need structure. In fact, they thrive on it. Good modeling and easy directions grow security in a child’s development. Modern psychology has come full circle, shelving the idea that asking children to make their own choices is unhealthy and often dangerous to their development.

Not coincidentally, adults do well with much the same direction and structure. Buyers respond best to those who know them and their wants, needs, and buying inclinations. It makes sense; we are better able to serve them when we know who they are and what they want or need. Buyers are like all people; they want to feel included. They want to be named in some way, labeled, if you will. When identified with their preferences people respond as insiders, those who are more highly regarded and cared for.

When we join anything, as social creatures are wont to, we are more likely to participate or contribute to the group’s message when feeling included. Countless studies show that participation grows in those that believe they are an integral part of a group. In a recent study, when voters were told they were more politically active this group was 15 percent more likely to turn out to vote than the control group that was not labeled. The net: give your customers the compliment of the discernment they possess for having crossed your threshold, in whatever terms apply.

We reward consistent behavior. We hear often: “I would never do that, ” or “I would always do this.” People want to be “counted on” to be themselves. We make a promise, then work hard to keep it, or excuse it. When treated well in a restaurant we say: “We’ll be back!” It’s the sense of belonging we crave, and which is a vital gate to Maslow’s next level of hierarchal needs; namely, self-esteem. On our way to fulfillment, the highest level of need, we relish the recognition of our specialness by others. Rewards are what we seek … to feel better, to be better, in the eyes of meaningful others.

Windfalls are followed by generosity. Lucky streaks at the gaming table lead to egregious overspending, followed by rationalizations. Turning losing into gratification by claiming it’s all in fun is common in casinos. Rewards of most any kind encourage repetitive behavior.

Why then are so many businesses reluctant to discount more than 10 percent? The closer we get to “free” the more compelling is our urge to participate. Clever goods and services companies know this well. Free shipping, carte blanche returns, 2-fers, instant prizes, and others are examples of the ways that attract prospects to turn into customers. If the drinks were not free on first class flights, people would gladly pay for them. Once labeled as superior, we feel the need to live up to the label, and we do, repetitively.

I watched in amazement as a convention booth captain invited people to spin a wheel with a guarantee that they would win something. Though prizes were small in value, people lined up to spin the wheel for the “instant gratification” it held. The idea is simple: they needed to feel special, and winning always does that for us.

Make your customers winners, elite decision makers, repeat customers, and best customers, using all the things you can think of to bring them in and relate the needs of each to feel good about themselves. Walk into a jewelry store and ask the price of something in the case. More often than not, the clerk responds with: “You’ve got good taste.” Then the game is on as she moves you into categories that confirm your self-worth, even when it stretches your resources. We spend more at Christmas than at any time in the year. The reason: it makes us feel good about ourselves. The moment we anoint another as special is the moment they align with your desires for them, no matter the cost. Labels work!

January 6, 2017 |

All in All


ROI by Frank J. Rich







By Frank J. Rich



We break from our series on consumer behavior to consider the opportunity in this holiday season, one that delivers us to another behavioral model. Most agree that the holiday season (around Christmas and Chanukah) has certain commendable effects on our behavior and spirit.

In the midst of all the rush and preparation to join with family and friends, prepare our homes, businesses, and streets with lights and decorations, people everywhere find welcoming others—in greeting and warmth—easier to come by. The jollity and glory of the season has no match, to be sure.

Somehow, we are able to forgive common road rage, endure long lines exacerbated by overwhelmed store clerks, interminable package delivery schedules for the cyber shopper, and the pressure that often contends with the joy in it all, until magically, the cacophony simmers in a moment when, all in all, joy returns to satisfy.

Where then in the celebration of this season is that seminal joy born? Not limited to two faith models—Jews and Christians—for many have taken up these holy celebrations, both Chanukah and Christmas focus on the meaning in rebirth. Among the Jews, Muslims, Christians and others, the idea brings hope into focus for both the faithful and all that share the gift of hope.

The Scroll of Antiochus concludes with the following words: “…After this, the sons of Israel went up to the Temple and rebuilt its gates and purified the Temple from the dead bodies and from the defilement. And, they sought after pure olive oil to light the lamps therewith, but could not find any, except one bowl that was sealed with the signet ring of the High Priest from the days of Samuel the prophet and they knew that it was pure. There was in it [enough oil] to light [the lamps therewith] for one day, but the God of heaven whose name dwells there put therein his blessing and they were able to light from it eight days. Therefore, the sons of Ḥashmonai made this covenant and took upon themselves a solemn vow, they and the sons of Israel, all of them, to publish amongst the sons of Israel, [to the end] that they might observe these eight days of joy and honour, as the days of the feasts written in [the book of] the Law; [even] to light in them so as to make known to those who come after them that their God wrought for them salvation from heaven. In them, it is not permitted to mourn, neither to decree a fast [on those days], and anyone who has a vow to perform, let him perform it.”

The birth of Jesus, told about in over 300 Old Testament references, offers the same light of God in the rebirth of each by the ministry, death, and resurrection of Jesus Christ, as told in the New Testament. In both, among many that measure the hope in rebirth, is the joy of this season, indeed its gift.

The Christmas Gift

Whose child is this, His coming could only find a manger and gather but a few men, and angels.

Whose son is He, who grew in time that none could tell; whose obscure childhood sifted mankind silently as though wine maturing.

Whose king is He, which kingdom is revealed only across a bridge of faith; with no walls to separate, and only the marriage vow to enter.

                                What manner of man is He,

                                 that would give up life to gain it,

                                 lose all to find it,

                                 separate to become one with His own,

                                 serve weakness to model strength,

                                 empower manhood through childhood,

                                change everything that is, without changing anything that was,

                                whose only desire was to honor His father,

                                whose greatest gift was His father’s greatest desire.

Human history is written in His blood, though schoolbooks barely note His name—the name above all names.

He lived, suffered, and died a man to give truth meaning and mankind its only hope.

He lives forever in the hearts of the faithful, to return as promised, to take them to His father’s house.

The great I Am!

(Over 300 hundred OT references to the Messiah were fulfilled in Jesus Christ. The probability of fulfilling just 8 of them is 10 to the 17th power, or 1 in 100 quadrillion).

This is a season that gives of oneself, forgives, serves, joins and is one with others, finds its strength in yielding, its ethic in innocence, and its hope in rebirth. Were these our daily bread would we have need of another? This is the gift of the season, that which emerges from ashes and selfishness to warm a higher plain. Though we struggle with the means and ends of life, hope is the last to die, and rightly so.


Shadows Lament


I stand quietly in the shadows, glimpsing the light.

Its pull a dulling fear of discovery,

Half Verbena, the other Larkspur.

Edging closer burns my skin and the fire in my soul, how shall I avoid the one and embrace the other without bursting into flames.

Warmer now, heavy under deafening silence I stretch out screaming at the emptiness within that struggles against a distant knowing.

I am at once with and without, desperate and fearful, warm hearted and struggling against my will to skirt the pain in fulfillment, the longing master in my journey.

I shall reach out first, then strike a match in the darkness, half fearing that any light might impose, that I might melt away should I chose potential over the past.


Editors note: Though given to reactive behavior we must live out our potential and not our past. Little but a forgiving, creative, and proactive choice reveals that potential.

May the joy in this season be the recrudescence you seek, and its spirit be with you.


December 22, 2016 |

Winning the Customer, Part I


ROI by Frank J. Rich







By Frank J. Rich



The short series on the principles in understanding the customer begins. The columns in this series will speak about “the customer,” his psychographic profile, the fundamental art and science of buying, and the channels and messages that satisfy his natural inclinations to find himself through the buying experience. In addressing elements of the buying experience (the human experience) that bear rethinking, and the actual results of subtle changes in approach and words that draw customers into a relatable and productive exchange with sellers, we will examine critical phrases and actions in forming a consolidated approach to winning the customer.

To succeed at winning a customer or turning a browser into a buyer may be as simple as understanding the buyer’s behavior and executing the methods that engage and convert prospects into buyers. In its essential guise, it is to discover what the customer wants, needs, or is in the habit of buying, under circumstances. This last bit of information is the fulcrum knowledge on which this conversion occurs.

In this “age of information,” there is no shortage of data to analyze consumer behavior. Psychographic data significantly aid simple demographic models by going well beyond where we live and what that says about our ability to spend. Regardless of our financial resources, it is still necessary to interrupt the customer with valuable information, engage him in useful dialogue, offer something of value, and deliver on the promise. Simple enough, perhaps, but fewer than ten percent of sellers of merchandise and services routinely follow this model of fulfillment, which is why most are just holding on in the hope that good fortune—competitors fail first and they are left alone to serve a growing market—comes their way.

Why do buyers say “Yes,” and browsers say “No”? An important reason is that buyers tend to respond more quickly and in greater numbers to offers that set parameters. We all like structure and fear the uncertainty in decision making. Setting value parameters appeals to our human nature, makes offers more relatable, and maintains our sense of accomplishment no matter the level. When a prospect feels that even a small action is a good start, they are more likely to take action. That makes them a buyer.

Giving perspective to the proposed action often is what it takes to get to “Yes.” For example, telling a prospect that a continuous run of six to eight ads delivers more consistent results—all other things being equal, such as the value of the offer, the perceived want or need level of the purchase, and the timing of the offer—then adding that a well-placed ad with a high-value offer will always encourage action when seen. The choice of media is always important, but whatever the audience, there are buyers among them in search of themselves in the buying process. How many have heard the comment from shoppers: “I like it, but it’s just not me.”

If a not-for-profit, don’t just ask for a donation; add the phrase, “Any gift will help.” Studies show that a 28:50 ratio results between offers without the last sentence and offers that include it. Significantly, most give no less when responding to offer #2. We can all agree that 22 extra customers make a difference.

Look for Part II of the series when we discuss customer identity models.

December 16, 2016 |

Winning the Customer


ROI by Frank J. Rich







By Frank J. Rich



The following is an introduction to a short series on the principles in understanding the customer. This column has spoken often about the customer, his psychographic profiles, the fundamental art and science of buying, and the channels and messages that satisfy his natural inclinations to find himself through the buying experience. In the coming weeks I’ll be addressing a number of elements of the buying experience (the human experience) that bear rethinking, and the actual results of subtle changes in approach and words that draw customers into a relatable and productive exchange with sellers. We’ll challenge norms, and in the process give both participants the opportunity they seek. In the meanwhile, start here to prepare for a walk through the mind of consumers.

In our efforts to apply the “truths” of business, we often err by the casual use of things we think we know. It’s the cogito ergo sum of a well-worn practice that allows such license, and the kind of careless thinking that leads to misunderstanding and ultimately, failure.

One such dictum is the oft-heard statement, “The customer is always right.” In its essential meaning it suggests that customers are to be treated with respect and deference, a special anointing that allows them the unusual privilege of obvious misstatements … about you, your company, or even the industry you work in. If you have customers, as most who work do, examples come easily to mind. But armed with such miscalculations we often face the most important objective in business—to satisfy the customer’s needs—with resentment and bitterness for having suffered through the dictum above. Increasingly, distinguishing the meaning in the statement from its expression becomes important as the requirements for “knowledge workers” rely on competence and careful assessments of the marketplace.

In fact, the customer is not always right, but he is never wrong. The heuristic in this seeming nuance is, perhaps, more important than most realize. Not only must we learn well how to serve the primary purpose in business—to create and keep customers—we must learn and practice an approach to the customer that encourages an effective response. When we choose to inform and educate, to become the assistant buyer customers seek, and not push and pontificate, then the métier of our choice is more fulfilling by the achievement of our goals. The alternative is the atavism of a Paleocene order, that which separates the future of business practice from the past.

Were this focus on the choice of words only the splitting of hairs, it would hardly be worth the paper they’re on. Rather, the careful consideration of words spoken and actions taken is the atelier of the mind, that workshop where all behavior takes shape. None of us wants to hear that we are wrong, but most are happy to learn something from another who is sincere and caring. The learning urge is fundamental to the human condition.

In his new book, People-Focused Knowledge Management, Karl Wiig asserts that mental models are the foundation of knowledge, personal or enterprise. As reference models, they encode personal experiences, and those from other sources. People and enterprises use these mental models to anticipate events and deal with situations. In simple terms, thought becomes behavior, and most thought is an essential combining of emotional responses to actual experience. How we “think” about the customer is how we will “behave” toward him. And this is why millions of dollars in sales are daily slain by the jawbone of an ass.

We have heard that there are two rules for business success regarding customers. Rule one is, “The customer is never wrong.” Rule two is, “When in doubt, refer back to Rule one.” Customers can be selfish, demanding, vain, fickle, arrogant, and disloyal; much like all of us when we turn into customers. What they are in search of is themselves, those qualities in the marketplace of suppliers that most relate to their own sense of value and belonging. If they come upon it accidentally, count yourself lucky. More often, it requires careful attention to their wants, needs, and habits, and good communications skills to win them over.

For example, I heard from someone at a recent gathering: “So, you’re a trainer. My company has a trainer already.” This, after answering his question about what Encore Prist International does. My quick answer was, “organizational development!” My second response was to ask if he had ever considered a difference between training and development. He had not, but was interested, so I obliged his curiosity. I asked how long he had been with his company, how old the company was, and the tenure of most in management. His answers all pointed to short work spans for most in the company, and a problem with turnover. I then asked what seemed most important to his employer when he was hired—his skills or habits. He pondered the question for a moment, then returned that he had not been asked at all about his habits, just a lot about what he had accomplished where he worked previously. I explained that his experience was fairly typical and that most short-term employees are let go for lack of good attitude and habits. Skills and knowledge can be taught through training, by skilled trainers, but attitude and habit journeyed longer in the making. Development, I offered, has a focus on the latter, and by the examination of right principles and practices as integral parts of the person and his values and belief system. With that, he admitted that his company had been wrestling with a turnover problem for some years, and that he had personally been looking furiously to fill slots in his department in the midst of a very competitive job market. Development, he concluded, might be just what his company needed.

Customers have three choices. They can buy from you, from another, or not at all. Most business success comes from developing customers of the “third kind,” those that drive other customers to you because they themselves feel so taken care of. Customers also have two important questions. “Why should I buy this product or service at all?” and “Why should I buy it from you?”  Know the answers to these questions, and never make the customer wrong.

December 9, 2016 |
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