Bullish outlook, despite a first quarter dip

Our client Tempur Sealy International (makers of Tempur-Pedic, Sealy and Stearns & Foster mattresses) recently released their quarterly results Despite discontinuing sales to the huge national retail chain Mattress Firm, they’re doing pretty well. Sales to the rest of their retailers are up 15% overall, and margins on those sales should be up, too.

While we are just a small sliver of a huge team, we like to think at least a part of that uptick is the result of the refresh of the Sealy brand we designed, which came out of the gate at the start of this year. With fresh new product graphics, point-of-sale displays, and a strong presentation to retail buyers, the 135-year-old Sealy brand has been elevated and reinvigorated.

“This represents the eighth consecutive quarter of double-digit adjusted EPS growth,” said Scott Thompson, chair and chief executive officer. “These solid first-quarter results are a byproduct of the team’s focus on our long-term initiatives and the overall positive worldwide economy underlying the bedding industry. We are pleased with the progress of our new product launches around the world and the positive early market reactions.”

“Eight consecutive quarters” just about syncs with the amount of time we’ve worked with Tempur Sealy. But I’m sure that’s mere coincidence. 🙂

For more bullish financial analysis, take a look at the industry publication BedTimes.

Milton Friedman’s disastrous argument

I read Seth Godin’s blog every day. I think he’s smart and we share most of the same values. Today’s post is a wonderful example of that. Its insight is simple but profound.

The renowned and (in many circles) revered economist Milton Friedman made an argument half a century ago that says this: “there is one and only one social responsibility of business – to use its resources and engage in activities designed to increase its profits…”

Since then, business school deans, the Harvard Business Review and Fortune (among others) have published rebuttals. But, as Godin points out, the interesting thing is that this corrosive, destructive point of view has been used to justify irresponsible actions by many, many corporations since it was published. Why? It’s simple. It lets people off the hook. It gives them permission to act like brats. To pillage the rest of society, take the spoils and run. With impunity. What’s not to like, if it applies to you?

But if the human beings who run companies can’t find a way to act like human beings, then it’s incumbent upon the rest of us to protect our larger society from them. We do that in other areas where we see societal damage: We can’t put melamine in baby formula. We can’t sell cigarettes to children. We have building codes. Hell, we carefully regulate near-irrelevant areas like sports. So why should corporations be immune from accountability?

I’m not suggesting we prohibit profits. Just that we insist they be tempered with other obligations. The same ones we live with as individuals. Here’s Seth Godin’s suggestion:

A business is a construct, an association of human beings combining capital and labor to make something. That business has precisely the same social responsibilities as the people that it consists of. The responsibility to play fairly, to see the long-term impacts of its actions and to create value for all those it engages with.

This sounds like a great starting place to me. More here.

Trust: Earned and Unearned

trust-fall1The brilliant Seth Godin (how many times have I typed that phrase?) explored the issue of trust in one of his blog posts about a year ago, and he raised a fascinating point.

All the ways that we think we — individuals or companies — need to act in order to build trust might be wrong.

They’re not wrong in the sense of creating mistrust. But they might not be very effective compared to the shorthand heuristics we actually use as consumers, voters or friends to decide whom to trust.

Why do we trust brands like Apple or Google or Evernote? Have they been so transparent, so altruistic, so consistent, so authentic that we should hand over our most sensitive data to them? Do we know enough about them in order to truly trust them? And would we even be willing to take the time to find out?

No, probably not. Our lives are just too complex, too fast-moving, and there’s too much information to evaluate. Instead we trust online reviews, Consumer Reports, MSNBC or Fox (your call), or even Seth Godin himself, to tell us the truth and help us make decisions. The world is so large and we are so small and fallible, there’s no way we can know the future or predict the kind of complex behavior of which humans and their companies are capable. So we jump off the cliff in good faith, using our best guess, and hoping we’re right.

What are the clues we use? For people, it’s body language, choice of words, a look in the eyes, a sense of the familiar. For brands, it’s product design, packaging, graphics, warranties, a voice, a website. And for both it’s referrals. Other people’s experiences are the biggest touchstones. Making sure their experiences are good ones— keeping your promises, correcting your missteps, treating people with respect — all are indicators that trust is a safe choice.

Unfortunately, charlatans know how to play us. We trust our gut instincts and sometimes those instincts are wrong. But mostly, I think humans have evolved to have pretty good bullshit detection systems. We can be suckered to a point. But if we trust our antennae, we usually head down the right path. Eventually.

Want to read more? Check out Seth’s blog.

 

Customer service the right way

Previously, I wrote a post about our e-fax provider and how painful and silly it is when they have to go through a giant litany of scripted attempts to keep you as a customer.

Here’s a contrasting experience.

After 10 years with DirecTV, we decided to save some money and consolidate our internet, phone and television signal under Time Warner.

I expected the same sort of runaround. But instead, I had a friendly, helpful, almost touching experience canceling my DirecTV service. Their rep, Misty, was understanding, funny, and utterly charming.

Of course she tried to keep me as a customer. But her approach was thoughtful and genuine, and not scripted. In the end, she realized they couldn’t compete with the package our cable company was able to provide. So she created a reasonable, non-defensive transition for me. No crap. No whining. No blaming. Just pleasant and helpful.

That goes a long way toward building DirecTV’s brand and means I’d happily reenlist if they meet my needs in the future. And here I am, unsolicited, telling everyone in earshot that they were wonderful. How much advertising and PR would they have to do to achieve that kind of result?

Checking out Dropbox Paper

Dropbox Paper

Dropbox has sent us all a Valentine. If you have the app installed, you probably got an email or two from them about their new collaboration product, Dropbox Paper.

So, either Paper is a “low-end disruptor” that will transform the way people collaborate online, or maybe it’ll be a hammer searching for a nail, and nobody will really use it. If it can make things easier or better for non-traditional, distributed teams like our own, or for those of us with clients in many cities, that would be a welcome addition to our arsenal of tools.

Scott Rosenberg says, “At its launch state it looks like a simplified browser-based document editor with comments — as if Microsoft Office or Google Docs got reincarnated as the love-child of Medium and Slack. “

But it looks like there’s great potential here. In his article about it on Backchannel, Rosenberg concludes:

“[One] thing…stood out for me: Although the half-dozen managers and execs I spoke to there were all straining a bit to bring the elusive vision of the new Dropbox into sharper relief, they presented a remarkably united front and consistent picture…The secret? Kavitha Radhakrishnan, Paper’s product manager, told me that Dropbox used eight Paper documents, total, to plan the whole product launch. In the middle of the last-lap scramble before the event, everyone was noticeably — as promised! — in sync.”

Can’t wait to test it out on a real-world project. What do you think about Paper and online collaboration?

Giant Sealy stretches —and wakes up the industry

For the past year, we’ve been working on a complicated, many-faceted brand refresh for Sealy — part of the world’s largest mattress manufacturer, Tempur Sealy International.

It involved a major rethinking and overhaul of the entire structure of their product line, brand architecture and marketing presentation.

On January 20, at the enormous Las Vegas Market trade show, the company announced the update and revealed the new line to stellar industry reaction. The brand was re-energized — and so were Sealy’s own sales staff and their national retail customers. The excited response was universally positive. We’re relieved (whew!) and delighted!

FreeAssociates was involved from the earliest stages, meeting with the brand experience team and brand managers, sales execs, product designers, ad agency and strategists to help define the brand, clarify its position, and craft its messaging.

Dozens of concepts were floated and vetted, tested and refined, through a grueling but thorough process that left no stone unturned. Over many months the design vocabulary was established and tweaked, until a powerful, unified evolution of the brand emerged.

Under the watchful eyes and thoughtful leadership of Director of Brand Experience Karl Myers and his Senior Manager Jonah Nelson, we crafted a comprehensive new branding system.

FreeAssociates has developed a refined version of the logo, color palette, the master brand style guide, point of sale displays and materials, product labeling, a feature icon system, sales guide, product guide, trade show campaign graphics and all the displays and information graphics for Sealy’s 14,000 s.f. permanent showroom at Las Vegas Market (interior designed by Jhipo Hong).

We’re truly grateful to be working with this talented Sealy team and to have an opportunity to help affect the course of their venerable 130-year-old brand.

For the full story, take a look at this article in Furniture World.

Desperately keeping customers

siemens_kf108-gross

It always amuses me when online services try everything they can think of to keep your business, especially when their responses are rote and pasted in (or read) from a script. It’s so inhuman and odd.

I just canceled our e-Fax account. The poor online agent had to run through his entire repertoire of canned objection-answering. It feels so creepily fake to be on the receiving end of this stuff. If only corporations could just empower their reps to connect with customers like human beings. (As the best companies do.)

Here’s the transcript.

Fred: Hi, my name is Fred. How may I help you?

Josh: Hi, Fred. I’d like to cancel my account please.

Fred: I am glad to help you. Could you please provide me your fax number and 4-digit PIN/last 4 digits of the Credit card on file for verification?

Josh: 310-441-9949 is the fax number. Charges to card 4007.

Fred: Thank you for providing your information. Please give me a moment while I pull up your account.
In the meantime, please type the number corresponding to your reason for cancellation:
1) Moving to another provider
2) Bought a fax machine
3) Business or role changed
4) Short term project completed
5) Financial reasons
6) Problems with faxing or billing
7) Dissatisfied with quality of service
8) Too costly

Josh: 8

Fred: Josh, as we’d like to keep your business, I can offer to waive the monthly fee for the next 1 month. During this time, you will not be charged any monthly fee.
Fred: Secondly, after the free period, the monthly fee will be reduced to $12.95 per month. This plan also includes 150 free inbound and 150 free outbound pages every month.
Fred: There is no contract and you may cancel anytime. Shall I switch you to this 1 month free $12.95 monthly plan?

Josh: As usual with numbered questionnaires there’s no really accurate answer. We just don’t use faxes anymore. I’m paying monthly to receive junk faxes from travel agents and bogus business loan companies.

Fred: If you believe that you are in receipt of a junk fax, we ask that you please submit the offending fax to us by visiting https://www2.efax.com/privacy?tab=reportSpam We will investigate your complaint, and attempt to prevent any further transmission of junk faxes from the same source.

Josh: Thank you, but please cancel my account.

Fred: I completely understand your wish to discontinue. May I offer you a waiver of 2 months on the subscription fees so that you can re-evaluate your needs?
Fred: This way, you will be able to send and receive faxes for 60 more days. There is no contract and you may cancel anytime.

Josh: No.

Fred: As per the records you have ported this number into eFax. I would like to inform you that once the account is cancelled you will not be able to use this number. If you want this number back, you will have to ask your service provider to submit a port request to eFax and once the number is ported out successfully you need to get back to cancel this account.

Josh: Okay.

Fred: Would you like to keep the account active?

Josh: I know you have to go through this silliness, but no. Please just cancel it. End it. Stop it. Kill it. Like the parrot in the Monty Python sketch.

Fred: OK, I will go ahead and cancel your account. Is there anything else, I may assist you with?

Josh: No, thanks, but please do send me a confirmation by email.

Fred: An email has already been sent.

Josh: Thanks for your help.

Come on, just this once…

will-work-for-free

Months ago, I heard a Design Observer interview with Jonathan Ford of Pearlfisher . The whole show is worth listening to, but there was a particular quote at around the 28 minute mark that struck me as significant enough to write down. Host Debbie Millman asks Ford to explain his firm’s policy on why they won’t ever do a free pitch, or free work. Here’s what he said:

“What we do has a value. Designers are skilled people…we don’t produce a service. We are not vendors or suppliers. I hate that supplier mentality…I remind our clients that design isn’t like anything else. Design adds real value. It can build your brand. It can differentiate you from everyone else. And in a world where everything’s gone topsy turvy, where advertising has been fragmented and there are whole new channels, design is still tangible and will define the way to the future for your brand. That has a value that needs to be respected.

If you work for free, you’re giving away what you do, and that’s just bad business sense. If you work for low fees, under your normal rate, you will lose money because you will be diverting a lot of time away from other clients to try and win a piece of business for a low fee, and that doesn’t make sense either.

It’s far more sensible just to say ‘No’ and get on with the clients that you do have and do great work for them and build the value there — and the relationship…Designers just have to learn to say ‘What I do is important.’”

While occasionally we donate work to good causes, I don’t think we’ve ever pitched an account with free creative. Ford succinctly explains why. Our clients expect us to focus on their paid work and to give them our full attention. Rightly so. And with so many working relationships that span decades, we think that makes sense for our clients and ourselves. What do you think? I’d love to hear your comments.

My favorite books on branding (so far)

My friend and leadership group buddy Cheryl asked a bunch of us for our favorite books on branding. I sent her these, and thought I’d post them here for all of you, too.  I’d love it if you shared your favorites in the comments.

Brand is Four Letter Word:
Positioning and the Real Art of Marketing
by Austin McGhie
This is a smart, opinionated overview from the president of Sterling Brands’ Strategy Group with deep experience on the both the client side and the agency side of things. There’s a good interview with him on the Design Matters podcast that will give you a taste of the book. He hates the word “branding”. He contends that a brand is simply a relationship, and that you can’t “brand” anything, you can only position it.

World Famous:
How to Give Your Business a Kick-Ass Brand Identity
by David Tyreman
This is a workbook on defining your brand. I’ve used it as a rough guide in leading two companies through a deep evaluation and redefinition of their brand strategy and found it very helpful. Tyreman worked with Polo Ralph Lauren, Nike, Banana Republic and many other companies and has a kind of enthusiastic upbeat approach that works. I find him a little relentlessly self-promotional, but the core stuff is great.

Start With Why:
How Great Leaders Inspire Everyone to Take Action
by Simon Sinek
Probably my favorite thinker about clarifying who you are and what your purpose is, and letting that drive what you create — as a company and as a person. First got turned onto him by a friend at an agency who was using his concepts in everything they were doing for their clients and themselves. I have drunk the kool-aid.

The Brand Gap:
How to Bridge the Distance Between Business Strategy and Design
by Marty Neumeier
Practical and highly visual, Neumeier presents his ideas in an entertaining and very valuable way. Easy to read. Fun to look it. Awesome cover design. “Fresh” and “relevant” to quote some of the blurbs. Many clear and simple ideas, but not “light” ones. The guy has thought through his subject and distilled it well.

Purple Cow — or practically any of his other books
by Seth Godin
This guy is the big thinker about positioning and marketing businesses. Huge influence, unafraid and committed to getting people out of the fear-driven culture and finding their art as business people. Purple Cow is about being different and remarkable — the essence of a good brand. I have to admit I didn’t like it at first; it seemed a little contrived and precious. But as I’ve delved deeper into Godin’s world through blog posts, interviews and other books, the principles just make more and more sense.

Your turn.

Inspiring leadership starts with Why

Start With Why bookWhy is it that a company can write glowingly about its specs and features and even its benefits and elicit not much more that a yawn? Why do we meet the promises of our politicians with such apathy? Why are we so focused on convincing and manipulating people instead of inspiring them?

We think we make important decisions rationally, but we almost never do. Instead, we are driven by, and respond to, signals that are difficult to articulate, but powerful when we receive them. And to be effective and meaningful, those signals always start with “WHY”.

That’s the premise of Simon Sinek’s fascinating study of leadership called “Start With Why: How Great Leaders Inspire Everyone to Take Action” (Portfolio/Penguin).

You may know Sinek from his TED Talk, which I’ve blogged about previously. His book expands and details those concepts with many examples that go far beyond the few in his video. If you buy his basic premise, that the WHY is the hook that connects us to the brands and ideas we care about most deeply, then his book will flesh out your understanding and give you lots of fodder for your thinking.

I have to admit I’m not a huge fan of Sinek’s writing style. I find him too pedantic and repetitive. But that may also be because this is the kind of book many won’t read cover-to-cover, and he had to include repeated references and reminders to anchor his points. I’ll give him a break on that score because his fundamental idea is so important.

That idea is well worth incorporating into our communications — not just our marketing efforts but our broader role as leaders (and we’re almost all leaders in some sense, but that’s another conversation). We want to start with the WHY. The belief. The purpose. That’s what will enlist followers in our vision. As Sinek points out, Martin Luther King didn’t say, “I have a plan.” He said, “I have a dream.” And millions of people who shared that dream of fairness and equality, who also imagined a world where people were treated like people, thought, “Hey, this guy thinks like I do… he wants what I want.”

Notice that they didn’t say, “Hmmm, that’s an interesting idea.” as if they had never imagined a world like that themselves. King tapped into something that was already there. He attracted the people who already believed what he believed, and then galvanized them to action. They became a movement because of the WHY.

Sinek explains that brands work the same way. People love or hate Apple. But the reason the company has so many rabid fanboys is because they stand for something and are willing to start their communications with that central value. If you identify with their rebellious creativity and obsession with design detail, with their core belief in challenging the status quo and thinking differently (their WHY), you’re on board. And you’ll pay more for it, because it reflects who you are, and meshes with your personal values.

That WHY pulls a company, a leader, a brand, out of the swamp of commoditized, transaction-based competitors. It means you no longer need to offer a lower price than everyone else. It means you don’t need to drive volume with coupons and discounts and sales in a never-ending downward spiral of slimmer and slimmer margins. It means you create products or companies you love and care about, and your customers are people who feel the same way.

That’s why Sinek’s message means so much to me in my own business, and to my clients’ businesses as well, whether or not they’ve read the book. Creating work I care about for people who feel the same way? That’s my dream job. And I bet it’s yours, too.

Grab a copy of Start With Why. And start letting people know what you really value.