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April  28, 2008

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GROWING YOUR BUSINESS TOGETHER





contents

It's All About Experience
Going forward, will experience be more of what consumers want

Kick-start Your Creativity to Rev Up Sales
Getting creativity started can be difficult, especially for you and the team

1-800-Flowers Launches Video Production Company
This new video production company will be used for training, commercials, and programming

As Colombian Peso Grows Stronger, Prices Go Higher
Exporters are looking for new solutions with the rising against the U.S. dollar

Survey Says: Fresh Flowers for APW
Fresh cut flowers take over with 80%

Flowers Canada Retail School of Floral Design
Starts May 26th - Save $100 before April 30th

Upcoming Events
May 23-25     ATLANTIC Region Spring Conference

 




it's all about experience

Companies that try to create holistic experiences by emotionally engaging their consumers are flourishing

Advances in manufacturing technology and the global reach of the Internet have leveled the playing field in the product marketplace. It wasn't long ago that time-to-market was two years, then 18 months, and then 12 months. Now, a competitor can knock off your "innovation" in six months or less. Many businesses understand that being "new" or "different" is no longer a differentiator. Countless companies are elbowing their way to the top with designs that are also "feature-rich" or "patent pending." Innovation in product design has lost its meaning and, therefore, its value.

There is still one frontier that remains wide open: experience innovation. This is the only type of business innovation that is not imitable, nor can it be commoditized, because it is born from the specific needs and desires of your customers and is a unique expression of your company's DNA. Yet the design of an experience is often overlooked in the rush to market.

Creating a Complete Experience

Companies intending to be relevant today must learn the art of creating experiences that genuinely engage their customers. Choice-fatigued consumers are not looking for another product that hasn't taken their true needs and desires into consideration. They are looking for companies in which to believe and give their allegiance. They are looking for experiences that cater to their deep-seated desires. This type of engagement requires much more than the latest technological breakthrough: It requires emotional engagement.

This has the highest value to customers because it has meaning. And it even allows companies to reimagine an old idea: The product or service itself does not have value, but the way in which it is experienced makes it fresh. That means you can even charge a premium for it. At over $100 a pair, Lululemon Athletica's (LULU) yoga pants aren't popular simply because of an advance in athletic apparel design. The brand's promise of well-being and its promotion of conscious living permeate every aspect of its business, creating an experience that customers are willing to pay top dollar for. Lululemon's sales at its retail stores doubled in the fourth quarter of 2007.

Creating a meaningful experience requires thoughtful attention to your customers at every point of contact—what I call the 360-degree experience. There are four components to consider when designing the 360-degree experience:

Know where you are in the innovation cycle. There are three areas of innovation: technology, product, and experience. Companies such as Intel (INTC) or Texas Instruments (TXN) offer technology products, such as a semiconductor or wireless data transmission, which can be broadly adapted for many uses. A company such as Sony (SNE), meanwhile, has commercialized a technology and created physical products. Then there are companies that create an experience for customers; engage them and tell a story. Starbucks (SBUX), for instance, took a simple product—coffee—and turned it into a complete experience that satisfied the previously unmet need for café culture in the U.S. Understand where your mindset lies in this innovation cycle, and know what it takes to participate and perform in the other spaces. Migrating to a different area is possible but extremely difficult, and one which requires an alteration of thinking, measurement systems and, eventually, a company's DNA.

Know your DNA. The only way to attract your true tribe is to authentically be yourself. Take a stand. Do what is natural to you and you won't have to fake it. Understanding your company's DNA is central to experience design. The athletic apparel company Nau is a great example (BusinessWeek.com, 1/31/07) of a company that knows what it stands for and what it is good at. With roots in the outdoor apparel industry, executives creating the company didn't just produce another label to compete in a glutted market. Instead, they established a mission based on their personal values for conscientious business practice and built a business that reflects these values. That ranges from a product line based on sustainable product innovation to a "partnership for change" program whereby 5% of every sale is donated to an environmental, social, or humanitarian organization.

Make emotional connections. Understand your customer well enough to know the difference between what they need and what they desire. In the Western world, businesses meet customers' functional needs with ease, but often seem to have forgotten how to connect with them emotionally the way, say, the corner grocer in a small neighborhood knows what products each of his customers loves. While it may not be possible to know each customer individually, we can delve much deeper than customer research statistics usually allow to create highly contextual experiences that reflect values, behavior, attitudes, and motivations. Ferrari is a wonderfully innovative brand in this regard—not only has it designed a thrilling racecar, but it tapped into the desires of those people who secretly dream of being a racecar driver. From the sound of the engine to the design of the fire extinguisher that is affixed to every interior, Ferrari found a way to put the racing car experience in the hands of a layman.

Design for the complete experience. There is no experience killer worse than a story being told in only one place. You may have a great product, but if customer service or your Web site don't reflect the story you are telling, the experience is invalidated and you run the high risk of losing the relationship with your customer. Every aspect of your business must reflect your company's DNA—and what you have learned about the desires of your customer. American Express (AXP) is a good example here—from the breadth of its product offering to the detailed level of service, its thorough approach provides customers with a feeling of security, empowerment, and being well-cared for—a feeling for which customers will pay a premium.

Competing in the market today demands innovative, emotional engagements. Creating complete, 360-degree experiences is the only way to be relevant in a glutted marketplace.

Source: Businessweek

 

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kick-start your creativity to rev up sales

Eight ways to become a more creative person

"So what business are you in?" asked the fellow beside me on the LaGuardia flight.
"I speak and write about creativity," I said. "Yourself?"
"A sales manager," he said. "Not very creative at all."

He returned to his spreadsheets and I to my writing. But I had to wonder if there was any clamoring in the streets for his products. Because it seems to me creativity and selling go hand in hand. Opportunities for synaptic boosts exist in all areas of the sales cycle—preparing communications, creating tools, developing proposals and, of course, making compelling presentations to clients and prospects.

When John Utzon presented his idea of a shell-shaped roof for the Sydney Opera House, he didn't have time or money to build fancy models. So he got creative. Sitting at a restaurant table with his customers, Utzon asked for an orange, then cut the shell-shaped segments from its skin. His mesmerized clients quickly understood and embraced the shell-roof concept.

But getting your creative juices flowing can be difficult if you've been keeping them dormant. Here are eight ways to kick-start creativity for yourself and your team.

1. Take a few risks.
Creativity doesn't come from playing it safe. "Creativity requires the courage to let go of certainties," said psychologist Erich Fromm. Creative people aren't afraid to try new things. They ignore the fears of putting forth their ideas and surge forward in new directions.


2. Don't quit too soon.
Mark Constantine once showed Body Shop a fizzling ball customers could dissolve in bathwater to add aroma. Body Shop turned him down. But Constantine didn’t give up on his idea. He now sells thousands of Bath Bombs at Lush Cosmetics each day, providing 40% of the company's sales.

Takeaway note: Just because a client slammed your idea doesn't necessarily mean it's a dog. Think how you can make it more appealing or who else you can show it to.

3. Look around.
Inspiration is everywhere: Charles Pajeau got the idea for Tinkertoys by watching his children build small bridges with their collection of pencils and thread spools; IDEO designed a new stroller for Evenflo with a higher seat after watching parents stoop to connect with their children in strollers; Proctor & Gamble marketers noticed unique insulation materials being used in the auto industry and came up with the Mr. Clean scrubbing sponge … the list goes on.

Look around when you're sitting in hotels, restaurants and airports. What's happening right before your eyes? What materials, techniques and solutions are others using that can become an idea for your marketing and selling efforts?

4. Have big ears.
Early jazz players praised a fellow musician by saying he or she had "big ears"—meaning the person actively listed to another's playing and built on rhythm, lyrics and tempo. Sales professionals know the value of listening to identify needs too. But are you also carefully listening to customers, friends, family, team members and strangers to uncover new ideas?

For example, a marketer at OXO International listened when a customer complained about the vertical handle on the company's potato masher. OXO soon introduced a new and improved masher with a horizontal handle that lets the user push down with more force.

5. Break out of ruts.
Are you watching the same TV shows? Going to the same restaurants? Visiting the same Web sites? Such sameness can sap creative thinking. Review your personal and business life, asking yourself which activities inspire you and which tire you. If they're inspiring, keep doing them. If they're tiring, swap them out or find fresh approaches.

6. Think ahead.
General Electric invests $14 billion a year on ideas and innovations. And CEO Jeffrey Immelt says GE rewards employees who have a healthy disregard for history. "Our idea people don't sit around and reminisce about the way things used to be," he says. "They're too busy thinking about something new."

To prosper in today's highly charged global environment, successful sales people look ahead and are willing to change. "It is not the strongest of the species that survives nor the most intelligent," said Charles Darwin, "but the one most responsive to change."

7. Spend creative energy like money.
Let’s say I give you $35,000 and tell you to go buy a car. Good idea, huh? But probably not so good if you instead use the dough to place ads about how much you dislike your existing car. Or if you spend the money on a car you hate.

Sounds stupid, right? But this is what we sometimes do with creative time and energy. We take our precious allotment of time and spend it complaining about what's in front of us or investing it in lackluster projects. Highly creative people use their finite energy for positive actions and innovative thinking.

8. Burn excuses.
Caesar and other ancient warriors burned their ships after disembarking to invade foreign lands. Seeing the flaming boats behind them, armies realized they must conquer or die. No retreat, no excuses.

Have excuses kept you from creating inventive sales plans or captivating presentations? If so, take a sheet a paper and draw a vertical line down the center. At the top of the left column write the word "But." At the top of the right column, write the word "So." List all your excuses for not creating something new in the left column. Then, in the right column, list actions you'll take to burn those excuses and start applying your creativity.

 

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1-800-flowers launches video production company

1-800-Flowers.com recently launched a new production company that will create broadcast commercials, corporate videos and original programming for 1-800-Flowers and, for a fee, corporate clients and retailers.

"If a store is looking for a new way to train employees, Connect 7 can help them meet that need with video," explains Yanique Woodall, director of public relations for 1-800-Flowers. "If the public relations department (at a corporation) wants to show highlights at a board of directors meeting, Connect 7 is available to make that happen."

The idea to begin Connect 7 originated with 1-800-Flowers founder and CEO, Jim McCann, who saw it as a way to better serve the brand's advertising and programming needs, Woodall says.  It was also seen as a tool for launching new initiatives, such as original programming for a new brand, Celebrations.com, and for working with external companies not part of the 1-800-Flowers.com enterprise

 

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as Columbian peso grows stronger, prices go higher

Industry buyers can expect lower supplies and higher prices as the Colombian peso continues to appreciate against the U.S. dollar. Inflation and peso re-evaluation is forcing exporters to look for solutions to stay in business.

The Colombian peso recently reached its highest point since July 1999: the exchange rate reached 1,773.05 pesos per dollar yesterday, according to Bloomberg, and is expected to rise to 1,750 pesos per dollar within the next month.

This is bad news for flower exporters whose revenue has been steadily decreasing due to the re-evaluation of the peso, inflation and rising fuel costs. According to a recent report presented by The Association of Floral Importers of Florida (AFIF), prices in the U.S. flower market have decreased by 3 percent per year (on average) since 2002, creating a cumulative 13.7 percent decrease in revenue received by farms.

"What that means is that all exporters get less money for their exports," says Jose Azout, president of Transflora in Miami, explaining the product that was once worth $100 in the U.S. is only now worth about $62.

At the same time, inflation in Colombia — which by law dictates labor costs — has driven a 31.4 percent increase in production costs. 

Further eroding margins, freight costs have also increased 61.5 percent between 2002 and 2007 due to rising global oil prices and less "players shipping boxes to the U.S.," Azout says.

All these things compounded have made it difficult for Colombian flower growers, causing some to go bankrupt, and leading others to possibly follow in their footsteps, explains Augusto Solano, president of Asocolflores, the Colombian Association of Floral Exporters. "Income has decreased, costs are going up and then there's the oil prices," he says. Farms "have already shut down this year. The situation has been hard."

To make ends meet, exporters are searching for alternative solutions. This includes increasing their production with more and newer varieties as efficiently as possible using available technology and exporting more to Europe, Solano says.

"People are trying to get better prices wherever they can," Solano explains. "People are looking at other markets willing to pay a little more to help with costs."

The bottom line, says Christine Boldt, executive vice president of AFIF, is that prices are going to be raised and that members of the industry need to understand why. "The price of getting product to the United States has increased significantly," she says. "The cost of production has gone up multiple levels, multiple times. We're not just raising the prices, the prices need to be raised."

The time for raised prices is already here, says Kevin Priest, AAF, of Cleveland Plant & Flower Company in Parma, Ohio. "So far [I haven't seen] a shorter supply but [have seen] some price increases, especially in the cost of airfreight," he says. "This is definitely affecting our landed costs and so [it is] passed along as higher selling prices."

And the consumer, adds Azout, will have to take some of the increase, because "no one in the industry can afford to absorb all the costs themselves."

 

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survey says: fresh flowers for apw

Fresh cut flowers win over green and flowering plants for Administrative Professionals Week (APW) Week, according to the results of last year's post-holiday survey of retail florists. Eight of 10 orders for the holiday (80 percent) were cut flowers, with the remaining 20 percent evenly split between green and flowering plants.

 

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