Monday, February 15, 2010

What's One MORE Good Idea Worth?

What's one good idea worth? A whole lot, I believe. I saw a real-time case of that in a Chief Executive Boards International meeting this week. Two different members left the meeting with ideas that will easily earn them $100,000.
How can that be?

When you have 6 or 8 people, all knowledgeable about the same topic, there's an amazing synergy (overused, I know) of ideas. People tag onto and build upon ideas of others. That's what happened in both of these cases. Here's just one of those stories:

A member who manufactures large capital equipment knew his customers needed parts, many of which he outsources -- things like motors, switches, gauges, etc. Parts are a traditionally high-margin item, starting at 50% margin (100% markup) and going up from there. They already sell several hundred thousand dollars worth of parts over the phone, to customers who happen to call them vs. a distributor. He had already thought through the fact that if he cataloged his high-runner parts in an online store he would get a lot of those orders, rather than the customer seeking out a distributor of the part itself. That idea is on his own scorecard -- not part of the $100,000.

What he didn't have was a really good launch plan for this online store. Websites are not a "field of dreams". You build it, and they DON'T come. Something has to drive some traffic there.

Regular readers know my personal conviction that a regularly-distributed, useful E-newsletter gets results. In this case, the member was encouraged to get a newsletter underway, something again that he had thought about already. What you need for that to be successful is LOTS of email addresses. Plan A for collecting those was to try getting people to give them up via a login/registration screen on their first visit. While not a bad idea, several members thought that would put up a barrier to potential buyers. And, of course, they would have had to hear about the parts site another way to have found it in the first place.

What was the $100,000 idea? While they know exactly the facility and company where they installed a large system, they don't know who would actually be buying the parts if they needed them. Worse yet, they don't have an email address to which they would send their newly-launched newsletter. Why not hire an intern to dial the phone for the summer, tell the customer they're launching an e-newsletter with good ideas on how to make their equipment more efficient and reliable, and ask for an email address (or more than one) of who should receive that. Wow, that would exponentialize the readership of their newsletter and when the newsletter reminds them of the online parts store, there's an engaged audience right in place.

Now here's the interesting part. The member looked around the table, and said, "I never would have thought of that." He's probably right -- it's so easy to get caught up in the mechanics of a project it's easy to miss a key point of leverage. The cost of the intern harvesting email addresses is likely 10%-20% of what he's already committed to spending on the newsletter and online parts store. Yet it likely improves the ROI and traction of both by 500% or more. And it raises the possibility of his message going viral. Those operators and plant managers talk, typically at industry events. All he needs is a few people who really like his newsletter telling each other about it and he goes viral -- the internet marketer's nirvana.

Will he execute? Time will tell, and his Board will ask. Will he earn a lot of money if he does? Absolutely. One good idea, in the hands of a capable CEO, can be worth serious money.

There are 250 days a year to spend at the office. And one looks pretty much like the next, in my experience. What have you done lately to put yourself elsewhere for a day -- in the crossfire of good ideas, whether at CEBI or elsewhere? At CEBI, "We Share Ideas."

Give it a shot. It's a strategy that's worked for thousands of business owners.

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Terry Weaver

Chief Executive Boards International

Chief Executive Boards International: Freedom for business owners & CEOs -- Less Work, More Money, More Freedom to enjoy it

1 comment:

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