Lessons

Lesson Info

Expansion and Disruption

You have to stand about the customer lifetime value for example a bright how long should I continue in my efforts in building this relationship with this person if she becomes a family member, she becomes a mom do I still invest time into this person and she becomes a grandma? Do I still invest time into this person? It really depends on up to you but every situation is different so this is where the customer lifetime value comes in there few things to consider the propensity to purchase and this is where you have to measure whether this person has a propensity purchase one more time or the propensity to purchase multiple times so let's consider family portrait sor newborns newborns you have one week old one year old two year old three four five six to all it to senior so the propensity of the lifetime to purchase is very high this is where you want to spend your time and cultivate this relationship where is the bride may not be as long but doesn't mean that's you cannot expand your bu...

siness into newborn pets and family for photography to it's something to consider as long as you do it secretly and not he'll make, um blow your main brand of away photographer you do it secretly or you just diversify I mean sorry you re brand your business so that it has a powerful enough roof to encompass all the services so I don't like apples think different it doesn't matter what they produce as always this nice and shiny and creative they work the only thing you want teo also concern aside from the target audience is also a propensity to purchase a diversity of products is there a way how you can sell different products to this different audience to the specific audience for a different period of time so this is something you want to consider um as your business progresses the next thing is you want to also consider for the lifetime is the strength of word of mouth marketing or w mm can this customer still refer so as always this customer still can refer them maybe it's still worth your effort the bottom line is eventually every customer justice how your product has a you know has a lifetime worry will expire eventually justice how I you know legal's for example used to really promote two kids I play with legos all time I would tell my parents I want to play with lego but do you see legal advertising on espn or hbo? Probably not because our lifetime our customer life time has expired but they might advertise for parents you know so parent child because I'm a parent I might want to purchase it for my kid and let the creativity begin so you see how lifetimes can change and pick back up later on but the whole thing is you only have a finite number of resources and time which brings me to the eighty twenty rule you have to prioritize your resources and energy. The eighty twenty rule if you're not aware of it is a fine idea that eighty percent your business comes to twenty percent declines eighty percent of your troubles and headache customers also come from twenty percent of those people eighty percent of your everything or even seeds with the whole idea eighty percent of the seed growth for peace come from only twenty percent of the seeds planted. So this is a general idea of how it works of course it's not exact but it can be but the bottom line is that you have to know where to prioritize your resources and energy because they will be exhausted eventually so let's consider a car, for example and as well as the massell hierarchy of needs. We have the safety car which is to drive from point a to point b we have a social car to win friends and we haven't steam car to parallel the person's success and perhaps the self actualization car to become the dream of a race car driver the self actualization so that's just a really quick overview of with that, you know, could mean but when it comes to your clients is a little different now bulletproofing efforts I mentioned my space a lot not that I'm trying to dig on myspace but when platform does fail all of your traffic fails too so you don't want to invest so much into that one basket you want to make sure that you diversify and have tabs and everything this girl is also floor having yourself hosted website and your email list and even google changes as we can see quite frequently for those who have used analytics for the past year you can see the changes already when it comes to email addresses people are very hesitant to commit but once they commit they generally stick around because I firstly have moved physically in my homes more times and I have changed my e mail address and it's probably true for most people too so keep that in mind so when we talk about we will have to really consider about expansion because you don't want to be stagnant and you don't want to be staying in the same place so you want to move forward. There are two ways to really progress in your business you can move vertically so up or down and then later we'll talk about horizontally or latterly but when it comes to a vertical expansion remember we talked about price differentiation for the husband, wife team or partner team or husband husband and wife team one person in charge more one person charges the status quo this way you can tap into a higher it here or if you're just by yourself you can have the price segmentation or price discrimination so it was like the matinee tickets for seniors, children and matt in the hours already ours. So this is where you can offer a lower price for a different tier of class of people. What example? I use examples I used for fireman and teachers now being with help him out you seem selfless but make sure you add the barriers to maintain the value so I limit five and if you want to throwing rule number two tied herself is cause even more it's a dedicate a percentage of the proceeds teo charity I'm not going to go into full extensive detail on that because we talked about that earlier but ladder expansion is another way so if you think about starbucks we talked about this numerous times even apple starbucks, for example, used to only serve coffee but then they expanded and purchase la boulange and sold sandwiches, salads, cristian space trees and eventually beer, wine, soda, yogurt I mean, they have everything it's because it's under one roof of community it's always a place to hang out, so even when you consider your own photography services, is it possible that you go on along the entire lifetime of a customer from engagement to wedding tio um pet two newborn to family to signor and then maybe wedding again so depends on how long you ristic around how strong your brand is to encompass everything you know it may be possible so some something to consider but despite all this you know you have to constantly change things because otherwise you're going to be stagnant so this is the part where I won't discuss briefly about disruption I mean they're actually books written on how to disrupt your industry and I'm not going to go into extensive detail how you could do so but I'll give you some examples of what has happened so the bottom line is when it comes to disruption you want to change things you want to find flaws or inconveniences that you currently facing the industry and find solutions to them even if they seem impossible because who would have thought you could watch movies from the cloud you know on your phone just a few years ago? I mean this is not like this is really disrupting the industry or even I'll give you some really cool innit cool ones here but let's just talk about what happens if you don't disrupt a lot of times with people who complain that o back in my days it was so much brother won etcetera, etcetera the reason why is because they've never changed and where your complacent and you don't keep up with social media, eh I'm gonna admit it I like social media, but I also don't like social media to it takes a lot of my time to have to keep up with all of this stuff and on top of it I have to be on top of everybody's news constant mother, everything on top of my regular life, you know, the life that I don't put online, so this is a lot of things, teo, but I have to because I don't want to be complacent, I have to constantly keep up when there is lack of disruption. You can really remember some of these brands you remember blockbuster what happened to them? Who are they competing with that six netflix? Do you remember what year of netflix is around or when they fell to purchase or anything like that? Two thousand oh, wow, that's actually when that's very good. So you have to imagine blockbuster was generating a revenue of five point nine billion dollars a year. That is a lot of money. Yes, they have brick and mortars and like a lot of thousands of employees but five point nine billion in revenue that's a lot. If it's not broken, why change it right? So in two thousand they even turned down to purchase netflix for fifty million dollars. I know how it's indeed fifty million that's, nothing to them again, if it's not broken, why change? Because if you were in the board of let's just say we were the board of directors or chair of people take all were generate so much you know they're only taking away one percent of our market who cares next year is two percent nothing peanuts and that we're blockbuster here what's this little miller thing with cds and stuff it doesn't make a difference to me so it is not broken why change? But this is the part where you are forced to change and if you think about google, google throws out a lot of changes out there google wave google this google that google fail constantly fail fail fail but it doesn't matter because they're constantly innovating but when it works it works. Gmail is one big one that worked google glass is one very cool innovation that everybody wants decidio I'm about you guys but I do want one so next one kodak who did it? Who did they go against just digital so kodak and justin keep up there is this massive company who cares? You know but when you don't disrupt in industry this drop your own company you will eventually reach a crisis point and failed that is the outcome of all businesses you have to remember that and I'm not trying morbid or anything like that it's just a way of how businesses work when it comes to mtv versus new mtv I had the opportunity to sing it to sit in a a discussion with the founder of tv robert pittman and he he he's a really cool guy he's of current ceo of clear channel and his friend called him up it's like oh you know his called bob locally okay bob you know I really love it you know you know what? I'm sorry going with again oh, you know, I've been watching them tv now and I really love it back when you were a ceo because he left a ceo and then robert pittman tell this friends like you know what happened you and I got told that was it because mtv just the changes and that's really good mtv changed itself so then you can constantly adapt itself to meet the needs of new markets. So last year I just want talk about sony's blue reverses the cloud network um when it gets an accounting they rule of impairment charge which is like a sort of appreciation but for an intangible assets they expected blue ray to be worth a lot but cloud is just like eating way into the market to a point where it's like you know what it's worth that much anymore so writing impairment charge so when it comes to disruptors let's talk about few people or let's consider them google change how people find answers because any time of the questions that go let's google it that's how I do now and they're like I mentioned earlier this constant throwing out new products whether they work or not but they just throw him out anyway and a lot of them don't but it's ok, they constantly innovate and that's what I encourage you guys to really think about two so facebook how people connect that's the bottom line before facebook you know it was always fragmented. Next one chipotle two pulley really popularized fast casual dining it's fast casual is in between between fast food like mcdonald's and casual dining like red bob sure that's really going so where you have a server or waitress waiter serving water or food drinks and all that and panera bread is another one in a fast casual you order food but you have no server you eat at the table you put to play away and you move on. So twenty years before it was popular, tripoli was every doing this on everything that they're also doing is disrupting how food cultivation is being done they're trying to push for non gmo organic and humane raising of animals grace choi really smart girl now I believe she's harvard graduate or something she innovated how makeup is synthesized your side it's so cool so right now you have to buy palette of makeup and applied on I'm only assuming because I got two trials already this's my second day of it but you get this little palate and then you put the powder on you and you can spray it on and things of that sort but if you have red but you want a different shade of red would you have to dio you had to go buy another shade of red that matches what you want grace choi found the way how you can synthesize using raw materials and just to think you have organic ends and stuff so you go online find a photo you want the lipstick color of the makeup of the foundation color you want or powder you find it you just get the hex decimal color code and then or the rgb called punch it in and you press into the printer it courageous and synthesizes the makeup right then there and you can play it on so that is really disrupting the industry. All of the other people either should buy her out or really be fearful right now so google glass door for those who have you know I went to the site they had changes how people should gauge wages next thing as ipod changes how people should listen to music versus cd walkman and the you know anti shaking which never works creative life is one big one disrupting how people should learn, you know I actually took the opportunity to watch the video reel of chasing craig talking about this, and I am of my backgrounds, also in education, I did my teacher's teaching credential, chapman university, orange and it's so true, the larger the classroom, the harder this for me to scale my teaching ability to everybody in the classroom to give them the single attention. Whereas in crete alive is a complete opposite where you can learn online and the bigger the audience, the more engaging it becomes because everybody gets to give their opinions and feed a feed off of each other is knowledge, which is actually helping in the chat room, which is really awesome. But I got a chance to check it out a little bit, so disruption is really important. Another one is google versus amazon. There you're smiling because your husband's amazon I love both into if you really think about how there disrupting how purchasing should be done it before. In the past, you have to google product and google was sent the traffic to amazon, then you purchase. But so may people are familiar with amazon that we just go straight to amazon, and we put two straight from there with one click buy and his ships directly with a second day air, unless you have the prime it's even free. Now google is getting scared because they're skipping google and their people going straight to amazon instead, google is entire core business model is about advertisement it talks it's basically, if you advertise with us, I will deliver conversion for you that's their entire business model advertisement so if they cannot prove that they can make that connection because people discs cutting through and going straight to amazon to buy google is left out in the cold so what they're doing now is competing with them through ping on their phones and direct mail my google express now they can ship products to you in san francisco and new york they're doing in pilot projects right now google is getting into the delivery services right now, which is interesting but I mean there's so much more they haven't done and if anyone's ghoul out there, googler is out there and I have ideas I could tell you but you know there's so many ways how you can integrate coupons you no urgency to buy and things of that sort geo mapping there are lots of technology and if you watch these companies compete and and or innovates and disrupt its really fun so which brings me the question to you guys we are only doing one thing over and over and over the runner mill how can you truly destruct your honest industry? So one very simple question is what it's one inconvenience that you're facing right now that you truly believe it's a real big hassle that should change how people should find you how you should pay how you should accept payments how you should deliver products what is it oh you act you haven't go for it I want to hear it it's kind of art already but it's not nothing super new but I dont delivered discs to clients anymore I do it all online so like using a service instead of a product that's only the demand is requiring it wanting it so that's really good that's definitely one way because as I mentioned earlier because audiences change because of a social cultural external factor we're becoming less existential so we want less things digital files are sufficient um for me I can't deliver my files online because my website has been hacked and some of the proofing websites have also been hacked so I guess my issue right now is I'm not able to take advantage of some of the cloud and you know things like that well that's um that's definitely predicament on interesting problem so whatever prom it is, what solution can you think of to fix that this is actually really recent this my website probably got hacked about six months ago so um by some type of spy bots but I I don't have a solution for that at the moment a tte the moment there it actually worked out to my advantage because they come in to do their sales in person, I make more money that way and then their files air delivered on a usb drive, but, you know, as technology advances, you know that you know, usb drive may not be what people want anymore, so whatever the cases think of ways, how whatever I'm doing now has to change because it's annoying there has to be a better way of doing something or completely different, like, what if we were to do it this way, x y z and I was just thinking about this myself, you know, I don't want challenge you on the spot, so I challenged myself. And if you think about how long the services now are done through a bark box, you might be familiar where it's a monthly service or, you know, frank and oakes, you know, for clothing, is it possible to even consider a service based or a monthly based photography service? I mean, if you think about it, some children need to be photographed every single year to monitor the change, so you might as well start collecting small amounts here and there, I mean, it's just going out there again, it doesn't mean that it has to work, but justice, how diddle online galleries and downloads are those are all things that, if you asked, a photographer a six years ago, a big funny, you know, that's, just a amusing idea. People like prince and albums bottom line. But as times change people and expectations norms, lifestyles often change. Well, I guess one of the things I've noticed as a wedding photographer that there's a lot of a lot of actually phone ups, where they encourage people to take pictures at a wedding and post immediately with the tag of the clock of the couple's name. And it kind of takes away from the professional photos because it's only a plate that night before you've even left the venue. So it's, like you're kind of competing with the instant gratification. Yes, that's actually very clever, because they're trying to disrupt the whole photo collection experience. And they're making a social the same time, in a way it's competing with you guys but that's. A very cool innovation that's, a very cool disruption of the how the industry is working and how we expect for those to be delivered.