Part 1 of What a Go-To Does Differently: Maniacal Focus

This is the beginning of a multi-part series to talk about what a Go-To does differently from the me-too pack. Firms that achieve Go-To status in their chosen markets follow a particular set of strategies that me-toos typically don’t. Let’s look at the first thing a Go-To does differently and how entities like Intel, Lego and the Apollo Space Program put it into action.

A Go-To Has Maniacal Focus

A Go-To focuses on a specific market that is large enough to provide opportunity but specific enough to allow the company to concentrate its finite resources in order to capitalize on synergies. Focus is not “a” way to gain market traction but “the” way.  Andy Grove, the longtime Intel CEO who transformed the company from a me-too chip manufacturer into an innovative Go-To for microprocessors, had this to say in his book, Only the Paranoid Survive:

A question that often comes up at times of strategic transformation is, should you pursue a highly focused approach, betting everything on one strategic goal, or should you hedge?…I tend to believe Mark Twain hit it on the head when he said, ‘Put all of your eggs in one basket and WATCH THAT BASKET.’  It’s harder to be the best of class in several fields than in just one…Hedging is expensive and dilutes commitment. Without exquisite focus, the resources and energy of the organization will be spread a mile wide—and they will be an inch deep.

— Andy Grove

How Focus Won the Cold-War Space Race Against the Russians

Having the honor of sitting next to Apollo astronaut Dick Gordon at a business dinner some years ago, I asked him for the most significant lesson learned from the Apollo Space Program. “The power of focus,” he said. “Anything is possible when you have a very clear desired outcome shared by everyone and around which all action revolves. In our case, it was the moon.”

apollo-program-cost-go-to-moonHe explained that prior to Apollo, the United States (representing the free world at that time) was losing the space race to its Cold War opponent, the former Soviet Union. U.S. space exploration consisted of a hodge-podge of initiatives, none of which worked together. There were numerous independent projects in progress, spread among multiple government agencies and contractors, involving thousands of people and investments of billions of dollars per year.

“The only driving theme was speed, to be the first at something, anything,” Gordon said. “All of that time and money was being expended while the Soviets kicked our butts with one historical achievement after another.”

In his bid to win the Space Race of the 1950s and 1960s, John F. Kennedy didn’t go broader, he went narrower. He said, “…I believe that this nation should commit itself to achieving the goal, before this decade is out, of landing a man on the moon and returning him safely to the Earth.” With those four words, “man on the moon,” he instantly focused the resources of all involved in the space program on one specific goal, one specific domain.

He didn’t do it quietly either. He launched it with a grand gesture in the most public way possible. He made a historic speech to Congress on May 25, 1961 that the entire world heard. He put a stake in the ground with a proud declaration of a singular goal. No one knew at the time how to do it; but if achieved, this feat clearly would establish the U.S. and the rest of the free world as the dominant force in space.

Sun Rays Vs. Laser Beams

img_3155The book, Focus: The Future of Your Company Depends On It, by legendary marketer, Al Ries, is now considered a marketing classic and makes a strong case for focus. It landed on my radar screen while reading an article years ago in Inc. Magazine about Bill Gross, the famed serial entrepreneur and founder of startup incubator, IdeaLab, in which he was extolling the virtues of focus, raving about how the book had changed his mind on the topic and also his fortunes. Here is an excerpt from the book’s introduction that sums it up:

The sun is a powerful source of energy. Every hour the sun washes the earth with billions of kilowatts of energy. Yet with a hat and some sunscreen you can bathe in the light of the sun for hours at a time with few ill effects.

A laser is a weak source of energy. A laser takes a few watts of energy and focuses them in a coherent stream of light. But with a laser you can drill a hole in a diamond or wipe out a cancer.

When you focus a company, you create the same effect. You create a powerful, laser-like ability to dominate a market. That’s what focusing is all about.

When a company becomes unfocused, it loses its power. It becomes a sun that dissipates its energy over too many products and too many markets.

— Al Ries

How Going “Back to the Brick” Saved Lego

In 2003-2004, Lego was in a state of crisis, with falling revenues following a long period of thinkstockphotos-178473803stagnation.  When new CEO Jorgen Vig Knudstorp came in, he declared Lego would go “back to the brick” by concentrating on core products and core customers. As detailed in the book, Brick by Brick, the company cut back on many of its brand extensions, cut the number of brick designs by 46%, and re-narrowed its market focus to kids ages five to nine. The next year, sales increased 12% and LEGO had come back from a $292 million loss in 2004 to a pre-tax profit of $117 million in 2005.

Recap: The Power of Concentration

Focus lets you concentrate your resources. It lets you concentrate your message, so that it speaks directly to your targets’ pain points and needs in their own language. It helps unqualified prospects self-select out, before they waste your precious selling energies. It tells employees what you don’t do, so they stay focused on the right priorities.

So make it your mantra: Focus, focus, focus.

Infographic: Anatomy of Content Marketing

B2B marketers have always relied heavily on “content marketing” going back decades now, mostly in the form of thought leadership. Because the concept is relatively new to consumer marketers and is buoyed by social media, it gets a lot of hype these days and generates infographics like this one. Nonetheless, I like this infographic for the useful statistics. It may help as ammunition for B2B marketers who need to justify their thought leadership programs and budgets. This is focused on the online, but there are many offline opportunities as well (e.g., conference presentations).

In planning your programs, be sure to take a strategic approach to the thought leadership you put out into the market place – it should revolve around the unique positioning you are after as a Go-To in your target market. Keep the content focused. Make sure the messaging differentiates you.

I wrote recently about the McMahon Group and their Go-To status in the private club sector. Every bit of content McMahon puts out into the market is aimed at educating private clubs on strategic planning, operations and member experience. It never deviates. And all of the information McMahon provides is useful and actionable.

Do an audit of the content you’ve produced over the last 6 months. Lay it all out – does it hang together? Does it revolve around a singular theme? Does it support the positioning you’re after? Does it distinguish you? And what can you do to improve going forward?

 

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Market Dominance Case Study: Owning a (Large) Consulting Niche

mcmahon-good180I’ve talked a lot recently about the advantages of being the Go-To in your chosen market and have offered up a couple of high-profile examples. But there are plenty of examples in specialty markets the average person isn’t exposed to. An example is McMahon Group in St. Louis, the Go-To for private club strategic planning and consulting, and I experienced the power of their Go-To status while playing the role of buyer.

thinkstockphotos-628711134I was once helping a premiere private club that was falling prey to the same tough trends impacting all private clubs across the U.S., if not the world – an aging membership, flat membership numbers that would decline if the club didn’t change, and less-than-optimal utilization of club facilities and programs – despite this being a club that was highly respected. I was on the long-term planning committee tasked with addressing this problem. One of our first steps was to seek out a firm that could help us conduct a member survey and determine a plan of action based on the results. In this situation, you can imagine how price sensitive the club was. However, results were more important. We could have sought out a generic market research firm. Afterall, how hard is it to put together a bunch of questions about how and why members use club facilities and what they felt was missing from the member experience? Heck, we could have done it with a free online survey tool.

We weren’t just after a survey, though. We were after a long-term plan that would improve the club’s future. We needed expertise. As it happens, there is an entire sub-specialty of private club market researchers and consultants we could turn to. Who knew? The club leadership agreed that it made perfect sense to hire a firm that understands the unique issues and trends impacting private clubs, even if it was going to cost a little more. We knew that member feedback and input was just one piece of what the club ultimately needed, and we wanted a firm that could help us ask the right questions, interpret the feedback appropriately and guide us toward best actions.

thinkstockphotos-512814378Then it became a matter of selecting the firm. The private club sector, like most industries, is a tight community at the upper leadership levels. Just like any industry, club managers all belong to one leading professional association, see each other at meetings, read the same publications, network with each other, and progress from club to club as they climb their career ladders. As a result, the general manager already knew of the top three consultants in the business, telling us that one, in particular, was the Go-To; so we interviewed all three. Two were impressive – they had great credentials, stellar reputations, and “trusted partner” status with their clients; had done many similar projects; obviously had deep expertise in this specific area; and offered strong teams. The cost of their services was also extremely reasonable and competitive. We knew they could each do a great job.

thinkstockphotos-77739477The third firm, McMahon Group, was all of that and much more.  In addition to the above, it was the thought leader in the field. McMahon didn’t just serve the industry; it led the industry by proactively investing in, conducting and sharing private club trends research, not just on where the industry had been and where it currently was, but also on where it was going. When we had lunch to interview the company’s president, Frank Vain, he humored us by listening to our litany of the club’s challenges and problems; but he could have told them to us himself, because they were no different from what he saw at every club McMahon Group works with.  He was finishing our sentences. And further, he laid out the trajectory we were on. Most of all, he prescribed the solutions right then and there – told us exactly what we needed to do.

In talking to Frank, it was clear that McMahon Group lived, ate, and breathed private club trends and operational excellence best practices. This is all it does. It knows everything going on in the industry. It knows all of the key players.  At its own expense, it studies and watches the trends on everyone’s behalf and warns the industry of what’s coming on the horizon. McMahon has taken spiritual “ownership” for understanding and solving the industry’s most pressing problems. And when you hear it talk about the industry, you can tell this company cares.

In the end, we hired McMahon, even though it was about twice as expensive as the other options. The reason is that we felt the club would get great value and an accelerated
path to results – we knew McMahon would not just execute a survey to tell us what the members wanted but would help the club quickly take the optimal actions as a result. We weren’t buying market research services – we were buying a treasure trove of expertise, experience and wisdom. It would help the club solve the problem – and fast.

That’s exactly what happened. We did the survey. It told us precisely what Frank had told us it would at lunch that day (yes, we could have saved a lot of money by letting him just give us the answers…but we needed to hear it from the members). The action plan ended up being exactly what he had prescribed during that same conversation. As a result, membership growth and club utilization have soared. The Club has since been thriving and doing better than ever, even through the “Great Recession,” when many clubs suffered badly.

The private club sector might sound like a small, limited market for a company like McMahon Group to target, but it’s about a $26 billion market consisting of 14,000 clubs in the U.S. alone.  McMahon doesn’t have to capture much of that market to have a great business. And by capturing the top end of that market and charging a premium price for premium value, McMahon has built quite a profitable business with a reputation that precedes it. It is, indeed, the Go-To in its space.

Give some thought as to what your company can do to establish this kind of reputation and make this kind of contribution to individual customers and your industry as a whole.

More on the Advantages of Being the Go-To

I recently posted twelve reasons it’s better to be the Go-To than a me-too and then four examples of Go-To brands. Here’s just a bit more on they advantages of being the differentiated Go-To.

The greatest advantage is that you compete less on price, if at all.  In fact, you can usually command much higher prices than the competition, because you offer a unique approach and can promise stellar results. The buyer considers the benefits you offer to far outweigh your cost.

Another big advantage is that you are no longer part of the pack – you stand out. You are the first name that comes to mind when the buyer has a particular problem. And that buyer often will proactively seek you out, particularly when time is of the essence (as in the case of C. C. Myers when the freeway melted).

Often selling costs for a Go-To are much lower, because you’re not starting from ground zero in a sales situation. Your reputation precedes you, so you don’t have to work as hard as a lesser-known competitor to establish your credibility. You don’t have to prove yourself as much. You can cut right to the customer’s situation at hand and how you can help.

As the Go-To in a particular field, you wield great power and influence in the marketplace. You aren’t just part of the fabric of the industry, you sit at the top of the pyramid. You help set the direction of the industry. You have a vision others want to follow. As the Go-To, you are in a position to fundamentally alter the direction of the market.

Doesn’t all of this sound much better than scraping for business as a me-too and being pushed to cut your price?

Infographic: Four Go-To Brands That “Own” Their Markets

This is a follow-up to my previous post and infographic, “Twelve Reasons It’s Better to Be the Go-To Than a Me-Too.” As it illustrates, achieving market dominance as the differentiated Go-To in one’s market offers lots of advantages. I thought it would be fun to provide a follow-up with some well-known names that people in tech can relate to, though there are many, many more out there. Though all of these serve a variety of markets now, they all started with a laser focus on one core offering, establishing market leadership before branching into other areas. Once again, enjoy and share. Better yet, send me your own examples of Go-To companies.

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Strategic Marketing Infographic: 12 Reasons It’s Better to Be the Go-To Than a Me-Too

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Market dominance simply means becoming the Go-To brand for a particular market need and being so superior at solving that market problem that you are able to command premium prices, work with premium customers, and hire premium people. Any company, no matter its size, can pursue it.  Your goal is to get people to seek you out and have them so firmly believe in your ability to make a unique contribution that they will pay you whatever it takes.

The alternative is to be a me-too that has to scrape for business and compete on price.

There are at least twelve reasons it’s better to be the Go-To, and I’m sure you can think of even more. Enjoy the infographic and pass it along…

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“I’m Begging You…Make It Stop!”

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Are prospects begging you to solve their problem asap? If not, consider this…

Your primary positioning goal should be to establish your company as the Go-To in your chosen market, so that you can eventually name your price and increase margins as opposed to watching prices and margins shrink under competitive pressure. This is the intent behind the Apollo Method for Market Dominance (TM).

If you’re currently in the position of trying to figure out what you’re going to offer the market, there are two keys to the equation.  The first you’ll hear often: Focus your offerings on large, common critical market problems. Yes, that’s essential, but it’s not enough. People will buy…eventually…and at some price. Just maybe not the price you want. Especially if they have competitive alternatives.

Here’s the common missing piece:  Focus on urgent common, critical problems. The more urgent it is, the more quickly the customer will buy and the more the customer will pay to stop the pain.

So ask yourself: “How urgent is the problem we’re solving?