Best sentence I read all day

Some people write the best titles such as Entrepreneurism is not a Lottery Ticket and I just want someone to buy my idea from me…. With titles like these, you don’t even need to read the entry. If you’re a consultant (paid, peer or otherwise) that is. [Caveat: I cribbed my title for today’s entry from a friend who uses it to great effect.]

Why is it that some people think their idea is akin to winning the lottery? Who would willingly admit one is of such limited imagination that having a marketable idea is so rare -like the proverbial winning lottery ticket- that one must pursue all course of action to protect it or capitalize on it? Which brings us to “I just want someone to buy my idea from me”. I can’t tell you how many emails I get like that each week. Ho Hum. I’ve taken to calling these people “idea flippers”, except they have a lot less collateral than people who’ve speculated with flipping houses. Nobody wants to buy an idea; execution is everything (Guy says it best). Which circuitously brings me to the best sentence I read today (and what started this whole mess)

…scarcity breeds innovation and abundance breeds a dull conformity. This is an exciting time not a frightening time…

So how do you move from innovation and excitement to execution if money is the issue and economic worries loom? I found some very interesting myths discredited on the American Express website in Myths and Realities of Financing Start Ups. From what I’ve personally experienced myself and from watching others, these particular things ring true (and I’d imagine American Express would know):

  1. You don’t need a lot of money to start a business. $25,000 was the figure quoted but with the right skill set, I’ve known plenty of DEs to start with less.
  2. You and maybe your family are likely to be your only investor. There are no angels and besides, are you sure you want one?
  3. You won’t find rich investors; 32% of investors have an income of 40K or less and 17% have negative net worth.

We’ve been talking a lot about this on the forum; we’ve decided recessions are a great time to start a venture; everything is less expensive and vendors should be more willing to do what it takes to keep their numbers up. Theoretically that is; the turnabout being a theme we’re constantly revisiting, that of lowering prices. One person (don’t know if she wants to be named) said it best:

You have to be careful about putting a lower priced customer into a higher priced item by catering to their price point because chances are they will not appreciate the differences in quality, they will feel that the sale price is the REAL and TRUE retail price point and thus you were actually overcharging to begin with AND they are unlikely to upgrade to paying full retail for your goods (because of the first two reasons).

As a result, members (so mentioned because I talk to more of them one on one than the average site visitor) seem to be looking at ways to maximize their positions, re-examining their messages in the marketplace and whether their markets will sustain them as compared to trends. One market many of us use as a bellwether is luxury goods and consumers with higher than average incomes. There’s several sources for that recently. One is Google’s study of online buying habits. Apparently, online shopping is the preferred retail medium of the wealthy. Cotton Inc recently published their study of preferred retail outlets by nation, finding people in Italy, the UK, Germany all spent more money in independent stores and furthermore, spent a lot more on clothes. The U.S. came in 7th place; citizens in China spend more on clothes than we do. Definitely OT but I meant to mention, when I was overseas, I saw a lot of signage in retail shops written in Japanese. The cut to the chase summary of trends is that the pursuit of exporting your brand may become inevitable if it isn’t already. You may as well prepare for it. The Cotton Inc study says -and this is a downside for DEs- U.S. consumers prefer mass merchants (23%) and chain stores (23%). Ouch. One last trend resource I track is Trendwatching. Sign up for their worthwhile and free monthly reports.

One last factor I’ll bore you with that appears to tangentially weigh on all of us is transparency:

Many assume — correctly — that a lack of transparency is what got us into this mess in the first place. Indeed, many consumers now believe that deliberate obfuscation and complexity was used to create huge amounts of fake wealth on Wall Street (true), and that we’re all going to get stuck with the bill (also true).

This could also apply to the messages we’re sending our customers and the lack of transparency. Iconoculture published a great article and in depth chart explaining how the economic crisis relates to shifting consumer values. The weight of personal values such as control, security, thrift, trust, self-sufficiency and stability are implications to consider when targeting your products to consumer demand. One such way DEs are uniquely positioned to provide transparency is through blogging. For example, I’m no longer surprised at the number of visitors who click through from here, wanting to know more about Fit Couture’s manufacturing processes. Maybe many of you think lean manufacturing is boring but apparently a lot of consumers don’t agree. It’s something to think about.

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  1. Kathleen says:

    Well, since no one left a comment, I guess I will.

    Via today’s WWD, the futurist Faith Popcorn says:

    WWD: What do you think the single biggest impact of this economic crisis will be on the way people live their lives?

    Faith Popcorn: Psychologically the rug’s been pulled out. We don’t believe in anything with a title. We despise institutions and corporations so much that ceo has become a curse word. There are T-shirts [like that]. If ceo’s stay that way in the mind of the consumers, we’ll have ethical panels running companies instead of ceo’s…

    The biggest impact is this lack of trust. An angry consumer. Icon toppling. Anchoring is big now — spirituality, atmosphere. This is the Bermuda Triangle of the culture: the environment is one side of the triangle, the ethics is another side, and the economy.

    WWD: What does that mean for the apparel business?

    F.P.: They have to find a new benefit in clothing, besides being warm and protected of cover. I think the benefit will be how it makes you live your life better. We talk about goodness. Is this piece of clothing made from a good company? Is it made in a good way? Is it sold in an empathetic way? Does it improve your chances of doing well in the world?

    What a company stands for is going to be almost more important than what the line of clothing is. Who am I buying from? Who’s the chairman? Who’s the designer? What kind of life does that person lead? I want that corporate logo stripped back; I want to know what I’m getting. It’s going to be much more raw and much more personal.

  2. Mike C says:

    We already have a model for how severe economic downturns affect people. It was called the Great Depression and it molded our grandparents.

    If you want to know the long term effects – ask a historian, not a futurist.

  3. rayna says:

    “F.P.: They have to find a new benefit in clothing, besides being warm and protected of cover. I think the benefit will be how it makes you live your life better. We talk about goodness. Is this piece of clothing made from a good company? Is it made in a good way? Is it sold in an empathetic way? Does it improve your chances of doing well in the world?”

    We already have a lot of this going on in lines, for more than a few years now. The thing is clothes don’t make you live your live better, living your life better makes you live your life better. It’s guess its something worth thinking about. ‘What will I be wearing once I begin living a better, balanced life?’ I hope it isn’t khakis.

  4. Sandra B says:

    The reason I use the name “sewanista” is only partly to trade in on the whole “fashionista who sews” thing. It also references the Nicaraguan “Sandanistas” who saw themselves as freedom fighters. So the tagline for my marketing is “Reclaim your fashion independence, and learn to design and sew your own clothes at Sewanista Fashion Workshops”. Kind of corny, but I really am quite passionate about living a life made of personal choices, not marketing strategies. I’m even suspicious of a bank’s motives when they supply chairs and a tv so you can relax as you wait in line. I always suspect they have figured out that it’s cheaper to distort your sense of time passing than to have more staff. I am often accused of thinking too much.

    As far as idea flippers, I get a lot of those. But the best was a new designer I did some patterns for. She had about 6 styles of swimsuit and a couple of caftans. At first she wanted to make it on her own terms but it soon became apparent that there was a huge amount of help available if she traded on her indigenous status. Within a year, and with still only the same few styles, she had a fantastic brand package developed, a website with amazing photos taken on location, and a huge amount of public awareness. She was becoming the face of indigenous success in the fashion industry here. She had spent a fortune on all the extras, but I couldn’t find any mention of stockists, nor find her swimwear featured in the shopping magazines. She was in the middle of negotiating with Miss Universe to dress the contestants when she made front page news. She had been arrested, accused of being the main player of a major drug ring, and couldn’t get bail to tie up the loose ends of her business, or even make arrangements for her 2 young kids (her husband was caught, too). Oops. Lucky she chose Australia to start a business self-funded that way. In Singapore, “execution is everything” could have been tragically literal.
    It was a thrill, however, to see all the rahrah (weekend newspaper glossy features, tv coverage, featured designer at Fashion Week parades) and know that the substance of what she had was pretty much my work. I don’t think she followed my advice to buy your book.

  5. Tonya says:

    Faith Popcorn is late to the party. The entire indie movement is about knowing who you are buying products from and what their values are. Buying indie clothing is about feeling good that your money is not going to support sweat shops. Buying indie food is about knowing the farmer who grew the produce and his environmentally friendly farming methods.

    It is the lack of transparency or the lack of knowing how companies are conducting business that will hurt them going forward. Not all large companies are bad but they are assumed bad unless they can demonstrate some level of goodness.

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