Can anybody remember who won Simon Cowell’s X Factor last year?
I spent a couple of minutes thinking about it and couldn’t be sure whether it was a man or a woman, let alone come up with a name….
If you’d like the answer, see my Blog entry from last year by clicking here.
…..that I just happened to contribute to, having had the privilege to run some of the world’s finest studios (including Abbey Road, Capitol Studios, Olympic Studios and Townhouse Studios) over the last ten years.
I was delighted to contribute to the article because the story of the rise and demise of the recording studio business is a story that deserves telling and the writer David Hepworth is one of the best out there. It was also an honour to be involved in the world of Word Magazine which whilst undoubtedly a world class (and my favourite) periodical it is so much more. Along with the printed magazine which has just been beautifully revamped into a New Yorker style format and comes with an excellent free sampler CD each month, Word publishes a weekly podcast (which is amongst the most entertaining podcasts published and is also free), sends out an amusing and interesting weekly email and has a website that is one of the few genuine communities on the internet where reader and writer and publisher interact like a bunch of old friends, an example of which is the recent spontaneous social gatherings of Word readers and writers in various cities around the world.
The closure of some of the magazine world’s traditional routes to market in recent times (Borders, Woolworths) has clearly hit all magazines hard and Word is no exception and there has been a significant and seemingly successful drive to convert readers into subscribers. Word continues to innovate. All subscribers are sent a digital copy of the magazine so that even if they are not at home to pick up the new edition of the magazine as it lands on the doormat they can read it online wherever they are in the world. I hope that this kind of fresh thinking will enable Word to long continue delivering great writing and great camaraderie into the forseeable and so avoid the sad fate of the recording studios that we discussed for the article.
This video of Apple’s Jonathan Ive talking about design is fascinating (he starts talking 30 seconds in).
I was put onto it by Bob Lefsetz , the music industry commentator, in one of his recent letters but have only just got around to watching it. [Incidentally I'd recommend anybody in or around an information-media business (ie a business that sells information be it music, film, news, television etc) to keep an eye on what Bob writes. The music industry has had more experience than other industries in dealing with the digital revolution and Bob is somebody who has learnt a lot from his time in the trenches over the past ten years and communicates it very well . You can subscribe to his newsletter here.]
This video is essentially the designer talking about getting design out of the way. His aim, he says, is to deliver a product that does the job it is intended for so easily and logically and simply that it seems “inevitable” that it is the way it is & so that the consumer thinks: “Why would it be any other way”?
Jonathan describes the way he approaches his work. “The design of this [product] in many ways wasn’t the design of a physical thing, it was figuring out a process. It’s really important in the design of a product to have a sense of the hierarchy of what’s important and what isn’t important by removing those things that are all vying for your attention.”
I think what Jonathan is saying can also be applied generally to business. He isn’t concerned with showing off to the consumer what he’s gone through to create a product; he has no time for bells or whistles. Instead he focuses entirely upon the customer experience and upon delivering this as well as he can. It’s strangely without ego and is inspiring. And he prioritises based upon what he needs to do to deliver the best customer experience. Clearly Jonathan spends a lot of time throwing away what is unnecessary and concentrating upon what his customers actually want to be able to do with his products.
And by concentrating on the essential things and particularly on customer experience-informed utilitarianism, Jonathan has, of course, arrived at an ultimate design and an essential “Appleness” that is recognized the world over.
The video is extract from a documentary called Objectified. You can find out more about the documentary on this very nicely designed website, here.
Not on the high street.com (NOTHS) is great idea that has been executed very well. It is a case study of how to put a business together from start up, take it through two rounds of funding and bring it to where it stands now – on the verge of becoming a national mainstream brand. It is particularly worth looking at if you are building an online retail business or simply looking for wider distribution for your creative products.
NOTHS is an umbrella website that provides a marketplace for hundreds of small creative businesses (which are producing or occasionally importing unique or personalised gifts) to sell their wares more widely. NOTHS make their money by charging the seller a fee for admission to the site and they also charge a commission of around 23 % on each sale. Net sales on a turnover of £30 million are therefore around £7m. Sellers benefit from access to a huge targeted audience and, as a consequence, increased sales.
Sophie Cornish (left) and Holly Tucker
The business was set up by Holly Tucker and Sophie Cornish in 2006 using their own savings and money borrowed from family and friends. They turned over £100k in that first year but after managing to raise initial funding from Spark Ventures (who were also early investors in Lastminute.com) in 2007 they were able to expand their offering and generated sales in excess of £3m in 2008. They concluded a second round of funding in the summer of 2008, raising £1m from selling a minority stake in their business to Venrex Investment Management and they used this money to finance the further development of the functionality and speed of their website. In recent interviews they have claimed continued growth levels of close to 300% per annum and have expressed confidence that they can achieve a turnover in excess of £30 million in 2011 (see comments by Holly Tucker in this interview in Management Today).
They started with 130 sellers in 2006 and currently boast more than 800. They claim to receive 300 applications to join the site each month and equally claim to turn down 9 out of 10 applications. One of the first key roles of NOTHS is to weed out those products that are not of sufficient quality or of the appropriate sort for the market and also those sellers who can’t hit the NOTHS customer service levels.
Its attractive to the consumer who gets access to lots of unique sellers and products that are, guess what, not available on the high street. (Actually some of them do have some high street distribution, but let’s not be picky; it’s a great business name and it is largely accurate). Having these products in one place saves the consumer having to trawl the internet looking for all the individual sellers ( in reality it opens up a whole level of creative products to a national audience for the first time; most of these products would just not be found by many people without NOTHS). There is only one basket and one checkout which makes it easy to buy and transacting with the relatively large NOTHS gives the consumer more confidence than dealing with small websites.
Although NOTHS collects the consumer orders (and the cash) the seller fulfils the order when it is passed onto them from the website. NOTHS is essentially a marketing and sales proposition for the sellers who benefit most by the increased exposure that comes from their inclusion on the site. NOTHS offer further value to their sellers. “We can then help them to make their products more attractive and commercial to a wider audience, sort out business objectives, win press coverage and give moral support. We help to take the risk and the confusion out of online marketing, and our catalogue gives them the kind of exposure they could never otherwise achieve on small budgets.” said Sophie Cornish to the Good Web Guide, full interview here.
I am a customer of NOTHS. I bought a few things over the Christmas period and was impressed by the slick service. The website is very easy to use and gives the impression that every detail has been thought through and checked a hundred times and then perhaps a hundred more. NOTHS are clearly dependent upon the speed and quality of fulfillment by the sellers but my experience suggests that this is not a problem. Delivery times for my gifts were exceptional in all cases and the communication from both NOTHS and the seller was consistent and clear. I was impressed.
I’ve spoken to a few sellers about their experience on the site and all were happy with their end of the deal. The NOTHS team is very professional and all the sellers commented that they were particularly impressed by the scale of the marketing that NOTHS provided. The only very slight criticism that I am able to pass on from them about the whole operation is that one or two of the sellers felt that NOTHS were a little more organized than perhaps they were and the sellers were concerned that they might not be able to keep track of the various things that NOTHS demand from them. No doubt this attention to detail is what drives the excellent customer service, but sellers should be aware that NOTHS will inevitability place some added burden upon them should they join the site. As the site is growing at 300% per annum, however, I suspect it will ultimately be worth their while sticking with it and making that small extra effort.
I bet the new paintjob on the XL Recordings HQ at Codrington Mews, London inspires the people that work there including the label’s artists such as Radiohead, White Stripes and the very very very wonderful Sigur Ros.
XL Recordings building
Side details of the XL Mews house
Rowing boat man pictured at XL HQ
How about this for an innovative way of raising $300 million. I have stolen this article about crowdsourcing in its entirety from www.pfsk.com.
Two ad agencies are testing the limits of brand loyalty by trying to crowdsource $300 million in funds to buy Pabst Brewing Co.
According to the Chicago Tribune, ownership of the brewing company was entrusted to a non-profit charity when the owner Paul Kalmanovitz passed away. Because federal tax laws forbid non-profits from owning for-profit companies, Pabst is now looking for a buyer.
Through buyabeercompany.com fans have pledged over $70 million even though the site lacks details as to what happens when $300 million is pledged and how ownership would be handled.
Earlier this month, the Mother agency was named as the UK’s agency of the decade by Campaign magazine. Their showreel is worth watching as a stand alone piece; its more entertaining than most TV programmes. You can watch the Mother showreel here.
Congratulations to all involved in making these ads – I especially love the creative use of great music throughout.
Its that time of the decade again; time to say goodbye to the Noughties and to look forward to the start of the next decade (will it be the Tens or Teens?). A lot of fun is being had looking backwards and forwards, picking highlights of the past ten years and anticipating the likely trends of the coming decade.
The Wall Street Journal has written a nice article on the huge changes in the business landscape over the last ten years. It highlights some of the macro and structural business trends since 1999.
I’ll pick out three things that struck me as a significant for anybody starting or running a business:
1) Google was 15 months old at the start of this decade.
As I write, Google has a market capitalisation of $189billion, generates $23billion of revenue, has almost 20,000 employees with an average income per employee of $1.2m. Pretty good progress, huh! Check today’s value on WolframAlpha.
The famous Bill Gates quote comes to mind. He wrote in his book The Road Ahead “We always overestimate the change that will occur in the next two years and underestimate the change that will occur in the next ten. Don’t let yourself be lulled into inaction”. Gates wrote that at the end of the 90′s.
I think that you can apply the same approach to building a new (or significantly changing an established) business – business plans always, always over-estimate what can be achieved in the first year or two of the plan. This is down to the sheer volume of work required and the number of new lessons that need to be learnt to get a business off the ground. Be prepared for that period of groundwork.
The other part of the Gates quote is also useful to bear in mind for a new or developing business; don’t underestimate what can be achieved in a ten year period and set your aspirations accordingly. Google set themselves the big hairy audacious goal(BHAG) to “organize the world’s information and make it universally accessible and useful” which is a breathtaking task when you think about it but they have then used this BHAG to explain themselves to the outside world (and to themselves) and to motivate their staff to achieve phenomenal results. Google reached for the stars and look where it got them. Set yourself a big goal. And go for it.
2) There will have been more cars sold in China than the US in 2009.
We are experiencing fundamental change in the world order with much greater influence and real power (economic and military) in the East particularly China. If the 19th century was the British Century and the 20th Century the American one, the 21st is already shaping up to fulfil predictions of it being the Chinese (and Indian) century. This change will through up a lot of opportunities as the world’s consumer markets expand but also threat as these countries compete for raw materials and markets. I have not yet travelled to either India or China but will do so in the coming years and feel very excited and energised by the prospect. They are going to make a huge difference to the world. Look at the scale of this parade of the chinese army as an indication of the size of their ambition:
3) The business landscape is accelerating: of the top 25 companies in the world at the close of 1999, only 8 remain in the top 25.
There are many and various reasons why 17 companies have dropped out of the world’s top 25, not the least of which is the success of their replacements. The world is always changing. What is different now is that the rate of change is speeding up. Obsolesence is quicker, exponential growth happens at a much faster rate enabled by new technologies.
And we all know what happens to companies that do not adapt. As Bill Gates said in his quote “Don’t let yourself be lulled into inaction.” Interesting times. What are you going to do differently in the New Year?
The Internet is bigger than you think.....
I would recommend following him.
Here is the link to Robert Tercek’s blog.
Fascinating stuff.
