Monthly Archives: July 2013

Buy Local


As an assignment for my MBA B2B Marketing Course, I was involved with a project to make a case for private and public sector corporations to procure ICT services locally, as opposed to outside of the region. The idea was that we would take a closer look at some of the impacts of doing so, to make not only an ‘economic argument’, but a ‘social argument’ as well, for the merits of taking such an approach.

At a high level, the argument is centered around such things as how when governments and corporations procure services (IT or otherwise) from organizations based in the region, the firms and their employees alike contribute to the tax base as well as the economy and society as a whole. While this may sound simple enough, when you have procurement departments that are accustomed (or perhaps even mandated) to making purchasing decisions solely (or even largely) on the basis on lowest cost – without taking a ‘total cost of ownership’ approach – it’s easier said than done.

In putting together the buy local value proposition – taking into account both economic as well as social factors – we were able to make some extrapolations of our own for the benefits of buying local based on some multiplier effects and assumptions from similar studies. We also took a look at some of the strategies and best practices being taken by global leaders in ICT such as Finland and Iceland; nations that have grown their ICT sectors significantly through such strategies as commitments to R&D investments, education, entrepreneurship and ICT exports – among other things. In doing so we were able to build upon some great work already being done by the New Brunswick Information Technology Council (NBITC) to make some recommendations for how to drive economic development through a strengthened local ICT sector, where a ‘buy local’ strategy could be a key pillar.

Here is an article from one of co-sponsors of the project, Larry Sampson of the NBITC that ran in the Telegraph Journal (local newspaper) on July 22nd, that was subsequently posted on the University blog where I retrieved it from, where he references the project as well as a few specifics related to my group.

The Need to Buy Local

New Brunswick Telegraph-Journal  Mon Jul 22 2013  Page: B1  Section: B  Byline: Larry Sampson Telegraph-journal

Early last week I was fortunate enough to sit in on the final presentations of the MBA business to business marketing class at UNBSJ. The teams (there were seven in total) had spent the bulk of the last few months trying to determine if it made more sense for government to purchase information technology goods and services from businesses owned and operated in New Brunswick (local), or those who operated here, but were owned elsewhere (non-local). Assuming we’re talking equivalent quality and price, you wouldn’t think there’d be much distinction between the two – both types of businesses employ people in the province, buy goods and services locally, and are active in the community – but apparently there is.

In addition to being struck by the professional level of many of the presentations and the insights they provided, it was clear this was a group of smart, passionate people with a global perspective. There were students from Europe, Asia, and North America – most of whom were “from away” – and many of whom had prior real world experience.

As you might expect there was considerable variation between the team presentations, however a number of consistent themes emerged. All the teams saw ICT as a significant means of growing the economy. The current low levels of investment in research and development by government and the private sector were viewed both as a weakness and opportunity. Multiple teams pointed out the incongruity between government trying to develop the economy on one hand, while ignoring the potential to leverage its own procurement to that end on the other. The need to better equip our education system to foster entrepreneurs and grow the supply of ICT-related talent was also regularly cited, as was the potential for ICT to improve the competitiveness of our more traditional economic sectors.

Every single team suggested there would be a significant financial and social advantage to New Brunswick should government introduce a formal “Buy Local” policy. Many of the teams backed this up with a detailed analysis showing how buying locally keeps more of the money in the province, generates increased government revenue, and produces more jobs. In addition to modelling the financial impact themselves (one team assessed the net economic impact was over 2:1 in favour of local purchasing), teams quoted from a number of Canadian and American studies. These studies found every $100 spent “non-locally” results in $30 to $54 more leaving that economy than if the same $100 was spent with a local firm. On the social side, local businesses gave back $5 to the community for every $1 provided by a multinational.

One of the more recent studies cited was The Power of Purchasing: The Economic Impacts of Local Procurement – a study that was completed this May by the Columbia Institute, LOCO, and the ISIS Research Centre in the Sauder School of Business at UBC. It concluded that local firms recirculate nearly double the amount of revenue when compared to multinationals, and create almost twice as many jobs per dollar of revenue.

When asked why we weren’t doing a better job of leveraging local companies to grow the provincial economy, the teams offered a number of explanations, including: government hasn’t done the math or seen the opportunity; the ICT sector is doing a lousy job of educating government; there is no champion/owner inside of government; and government procurement is fixated on reducing cost to the detriment of the big picture.

Assuming these students have gotten it even vaguely right, there’s an awful lot of smoke here for there not to be a fire.

Larry Sampson is the CEO of the New Brunswick Information Technology Council.

© 2013 Telegraph-Journal (New Brunswick)”

– See more at:


Leave a comment

Filed under Business, Management, Marketing, Strategy

Not All Customers Created Equal

EPSON scanner image

At the risk of stating the obvious, there is a fair bit of buzz around entrepreneurship and start-ups these days. I suppose the truth is that this is something I’m interested in and work around, so it could just be that I notice it more than some. Either way, I think it’s safe to say that it’s an exciting time to be in the technology space. It seems every few weeks you hear about another “success story” (editorial note – success can be defined in many different ways) of some start-up that has hit the jackpot, by being scooped up by a large corporation (Instagram, Tumbler, or locally in my neck of the woods, Radian6 to name a few examples), to realize their exit strategy (be it planned or unplanned).

Again, at the risk of stating the obvious, regardless of what you’re “selling”, and regardless of your exit strategy, at some point you’re going to need some “customers”. (paying customers would be nice, but that hasn’t stopped many of today’s start-ups so don’t let it stop you…at least for now). Knowing this, it’s helpful to understand how customer adoption can differ. Some customers like to have the newest, shiniest things just because…we’ll because they’re new and they’re shiny, whereas some customer are more pragmatic and will hang back and wait for the “2.0 release” when perhaps the cost is a bit lower and/or some of the bugs have been worked out. This is the case in both the B2C as well as the B2B world. There is a continuum on which customers exist – from the “Innovators” at one end to the “Laggards” at the other. Though there are many ways to slice and dice the types and tendencies of the various “customer adoption types”, I’ve outlined below one way I’ve seen it done recently (with a B2B focus) with some of my thoughts woven in for good measure.

  • Innovators – these guys are the “techies”; the group even before the “early adopters” that we hear about so often. These guys are the ones that must have the latest and greatest gadgets and technologies. The consumer market equivalent would be the hardcore “geeks” (no disrespect; being a geek is über-cool now) that camp out overnight a Future Shop whenever Apple releases…well just about anything (again – no disrespect; kudos to Apple for building the hype and delivering most of the time). If you’re trying to appeal to this crowd – and why wouldn’t you want to really – you’ll want to focus on the elegance and general coolness of the technology.
  • Early Adopters – hey I’ve heard of these guys! These guys are the “visionaries” and often also leaders in their industry. They prefer technology “revolution over evolution” and are always on the lookout for a new technology to give them a competitive advantage. Landing these guys as customers should be part of any strategy as they can become great case studies for early successes that can help you land customers of a more pragmatic nature.
  • Early Majority – these guys are the “pragmatists”. They dig technology but really want see the proof that adopting something new WILL yield business benefits (e.g. lower costs, higher revenue). Show these guys the business case for how this will help them save money, grow revenues or some combination of the two. Show them how finely tuned your product is now as a result of working closely with your innovators and early adopters. In Geoffrey Moore’s book, “Crossing the Chasm” Moore discusses how bridging the gap from the early adopters to the early majority is a key step for any organization to achieve mainstream success.
  • Late Majority – this group is often referred to as the “conservatives”, and as the name suggests, they tend to resist change but are willing to adopt so long as the changes can be integrated into their existing systems and/or processes. Boring!
  • Laggards – these guys are the “skeptics”. They’re just not into it. They only adopt technology when they’re absolutely forced to. (Internet Explorer 6 is no longer supported. Please, please upgrade!)

So that’s it*. Know your customers then go get em’.

* That’s not it.

Image credit:

Leave a comment

Filed under Books, Business, Management, Marketing, Strategy

Flip the Funnel Reflection Paper


A couple of posts ago I noted that I was reading a book for my B2B Marketing course called Flip the Funnel. This is a short ‘reflection paper’ that I recently submitted that I thought I would share.


This is a short reflection paper on the book ‘Flip the Funnel – How to Use Existing Customers to Gain New Ones’ by Joseph Jaffe, submitted for MBA 7384 – Business to Business Marketing, at the University of New Brunswick, Saint John. It is not intended to be a recap of the entire book, or even a recap of all of the concepts, but rather my thoughts on what I felt to be some of the more interesting aspects.

The Funnel – AIDA vs. ADIA

Marketing is ubiquitous. It’s all around us. We’ve all heard the statistics, at least anecdotally, about how many message we’re all exposed to in the run of a day, or a week, or a lifetime. It’s ridiculous. But alas, this is the process. This is what marketers do. They market. They break their necks to get our attention; to make us “Aware”. There it is; the wide end of the ‘traditional’ marketing funnel. As Jaffe, outlines for us early on in the book, the traditional marketing funnel is based on this acronym:

  •   A: Awareness
  •   I: Interest
  •   D: Desire
  •   A: Action

It’s about getting our attention; getting us into the funnel. From there they really turn on the charm and try to work us through the other steps, squeezing us into the narrow end of the funnel in hopes to get us to the desired end state: the sale!

This is how it is and how it may always be; but not if Jaffe has anything to do with it. In ‘Flip the Funnel’, he makes a very compelling argument for how the marketers of the world have been doing it wrong all this time and that instead of ‘AIDA’, the process should be ‘ADIA’, which stands for:

  •   A: Acknowledgement
  •   D: Dialogue
  •   I: Incentivization
  •   A: Activation

While the changes to the acronym look subtle, the approach is anything but. Jaffe spends two hundred plus pages making his argument for how, rather than spending our organization’s resources building ‘Awareness’ to a group of potential customers, what we should be doing is taking care of the customers that we have – and leveraging these relationships as an asset to build our businesses.

Multiple Perspectives

I really liked this book. I tend to enjoy books, authors, articles – people for that matter – that challenge conventional wisdom. In addition to the topic itself, I also enjoyed his informal, free-wheeling ‘write the way I think’ kind of style.

When reading the book, I tended to interpret his ideas, concepts and examples from two different perspectives. Firstly, I’m a consumer. Like everyone else, I buy stuff so I can relate to much of the content from that perspective. Secondly, I work for an IT consulting organization so I also tended to think about how the content applied to how my organization markets its services. Have we been doing it wrong too? And how can I take what he’s putting forward – essentially flipping convention marketing wisdom its head – and apply it to help my organization (ideally without getting thrown out the door for sounding certifiably insane!)

Retention over Acquisition

Jaffe’s argument around focusing on retention over acquisition, or even retention as a tool for acquisition, is an interesting one. The first thing that came to my mind when reading it was, ‘Well, you’re going to need to get some customers first’, since by definition, before you can retain something, you need to have acquired it first. With this in mind, organizations will need to figure out for themselves at which point, and to what degree, they execute this as a strategy.

Once you have arrived at a certain point however, switching the focus from acquisition to retention may make sense. At one point in the book, he put forward an interesting idea related to, what if as an organization you put the word out that you were going to put a ‘freeze’ on taking on any new customers. Now this is a radical idea, but he certainly got my attention!

When reading this I immediately thought of my experiences as a consumer of cable/phone/internet services. It seems to be almost every other week I see an advertisement in some form or another from my current provider offering incentives for NEW customers. My first thought is always (and you can probably guess) – what about me? Do I not qualify for the same – or dare I suggest it – a better discount for my years of loyal service? Something about this commonly used tactic doesn’t seem right to me. So, back to the point of implementing a freeze on new customers to better focus on existing customers – I think this would be a great idea.

Jaffe also spends considerable time in the book making the argument for how your retention strategy can effectively be your acquisition strategy; and it’s not that complicated. How many times have you felt, essentially kicked to the curb, immediately after a transaction has taken place? Far too many times, that’s how many. But, again – going back to the opening of this paper – this is how the marketing process typically works; once the sale has been made, you’ve been ‘converted’ and its onto making the next sale. Now, this isn’t always the case, some companies do it better and Jaffe provides some examples of who and how. He notes how shoe ‘e-tailor’ Zappos has had great success with a ‘Flip the Funnel’ strategy, with such tactics as a flexible return policy – again, not rocket science – just taking care of the customers after the sale. Other tactics that Jaffe notes that can be used to include things like simple ‘acknowledgements’ (the ‘A’ in ADIA) like a thank you card or a progress report (e.g. Amazon – ‘Your order has shipped’) to let you know that even after the sale, the organization you’ve just done business with still cares about you.

Jaffe argues that engaging in these types of activities make smart business sense, since they result in things like repeat purchases – and why wouldn’t you want your customers to be customers again and again? As we all know that it costs more to acquire a new customer than to retain an existing one, this only makes economic sense. Further to this, every happy customer you have is one more person who helps you with your advertising efforts, as word of mouth advertising and referrals have and continue to be powerful tools.

Happy Employees = Happy Customers

As I noted earlier, I’m a consumer (being marketed to) and I’m an employee (that ‘markets’ – if you will). The chapter titled, ‘How Employees Help Flip the Funnel’ was one that I particularly enjoyed. I found the section that referenced the Alexander Kjerulf blog post titled, “Top 5 Reasons Why ‘the Customer Is Always Right’ Is Wrong” to be particularly interesting. [Editorial note for blog readers – check out my thoughts on this post here.]

In this section Jaffe paraphrased the original blog post while adding his own spin on some of the things that organizations do in an effort to retain customers – customers that in some cases take a disproportionate amount of the organization’s time and resources and may not be worth the return on investment – at the peril of their employees.

The original blog post provided a comical example of a CEO that was tasked with dealing with a difficult customer with a bad reputation for never being satisfied with his company’s services, going through great lengths to make the service staff aware of her ‘issues’. Understanding the strain being put on his staff – and the negative implications that they could have in their ability to service other customers – he bluntly, yet politely ‘fired the customer’. Interesting approach!

Let’s get Social

The blog post noted above with the CEO firing the customer was originally posted in July of 2006. This was just around the time when Twitter was coming into existence. I make note of these two, seemingly unrelated items, only to point out that had this happened a few months later, this may have been a riskier move. It’s not that social media wasn’t in play in 2006, because it was. Facebook had launched a couple of years prior, however; at this point in time people were still mostly sharing pictures of their cats and brands were still in the very initial stages of figuring out if they needed to care about this whole social media thing. Things are different now (though many would argue that there is still a lot of cat picture share going on AND brands are still figuring out social media). This leads us into the next topic of the book that I found to be quite interesting: social media.

You can close your eyes and pretend it doesn’t exist or you can get on board. As Jaffe discusses, and makes you painfully aware through some great “good examples” (e.g. Obama’s presidential campaign) as well as some great “bad examples” (e.g. Motrin’s Babywearing debacle), social media is no longer simply an optional component of your marketing strategy. In fact, it goes further than marketing – or at least it should – social media can be a customer service tool and even a revenue generator. Since the advent of Twitter, the communication between companies and consumers is 2-way; it’s a dialogue (the ‘D’ from Jaffe’s revised marketing funnel acronym). It opens – and significantly speeds up – the lines of the communications between companies and customers. It also provides the customer with a captive audience to talk about your brand. If you do it right, you can leverage this channel as opposed to fearing it (which might be your first inclination). It won’t always be a happy story. Odds are you will take your lumps. If you don’t get it right, your customers will let you – and their legions of followers (and their follower’s followers and on and on) know about it. The key is to be in the game and listening.

Similarly, being on top of social media allows you to also provide your happy customers with an equal opportunity to spread the word, as Jaffe discussed in various areas of the book including the “Transforming Mouths into Megaphones” chapter.

Technology as a Game Changer

Similar to the social media phenomenon, technology can be an asset or a liability; it just depends on your view point as well as how you execute your strategy based on how you’ve opted to categorize it. In fact, just having a strategy is a good start. Jaffe goes to the commonly used ATM example for how technology has made our lives easier; by making a service that was once only available during “banker’s hours”, available 24/7. The advent of technology in this example has allowed banks to automate a once manual, human-performed service, to add value for their customers. The automation of processes is one way that technology can be used, but it shouldn’t be the only way. Organizations that ‘get it’ are the ones that use technology more intelligently, figuring out to what degree technology should be used  since just because you can do something, doesn’t mean you necessarily should. Organizations need to ensure that they’re taking a holistic view of their delivery and customer service strategies – a complete ‘customer experience’ approach – and understand that while an automated process may save you money in the short term, in the longer term it may not be the best approach.

At one point during the technology discussion, Jaffe takes the readers back to elementary school math class by using an analogy with fractions where he uses numerators and denominators as factors for the degree to which organizations choose to deploy technology in their businesses. He makes the point that smart companies think of technology not simply as a cost centre, but a way to ‘change the game’ and provides some good examples of companies that are doing just that. He notes how Apple, a company that does both technology and marketing  very well, put real people in their ‘Genius Bars’ at their Apple Stores and this is a strategy that is really working for them. He also notes IBM, and how they get it right by providing a multitude of ways for their customers to get in touch with them. When reading these sections it struck me as interesting that how something so seemingly simple ends up being considered as something so innovative.


‘Flip the Funnel’ was an interesting read and a welcomed change from another MBA text book. It made me think and entertained me in the process. There are many good points that I will consider and recommend for use in my current organization and further into my career.

While I think it is unlikely that too many organizations will abandon many of the traditional, tried and true, marketing strategies of old, there are many concepts in this book that are hard to argue with, including but not limited to the ones covered in this paper that included ‘retention over acquisition’, a focus on employees, embracing social media and understanding the right mix and use of technology.


Flip the Funnel, by Joseph Jaffe

Leave a comment

Filed under Books, Business, Management, Marketing, Strategy