Captain Obvious

Payless, the discount shoe retailer, just did a wonderful test of how packaging can convince people to spend way more money than they need to.  They opened a luxury store with all the trimmings and flash upscale shoppers consider appropriate in high end retail stores and gave it a flashy name: Palessi along with fancy shopping bags to show off your purchases.

See the results for yourself and watch the interviews.  They tell us a great deal about how marketing and sales dress makes a difference in customer’s perceptions of value. Read the ADWeek article here. 

It was clearly an experiment … a bit of a stunt, and Payless handled the situation with great tact and grace.  However, I am not sure the average person sees what this experiment really tells us.

Perhaps the flip side says more.  Joshua Bell played in a Washington DC metro station and almost no one paid attention.  He is one of the best violin musicians in the world. He played one of the most intricate pieces ever written with a violin worth 3.5 million dollars.  Two days before his playing in the subway, Joshua Bell sold out at a theater in Boston and the seats average $100.

This is a real story. Joshua Bell playing incognito in the metro station was organized by the Washington Post as part of a social experiment about perception, taste and priorities of people.

If you are facing competition … marketing matters … a lot.

The latest emphasis on beneficial electrification reminds me of when I first entered the electric utility sector almost 35 years ago.  Cogeneration and gas cooling had the electric utilities flummoxed.  They simply did not know how to “compete” with low natural gas prices and a seemingly endless supply of manipulative wheelers and dealers who made it easy for customers to switch.

As some of you know, I became very popular because I seemed to be able to dissuade customers from these ideas.  Very few of my clients took my techniques to heart … they were just glad to be rid of what they thought was a distraction on the part of customers.  After all, customers should not be interesting in being in the utility business.  So they thought.

When I wrote the book, “Cogeneration Issues and Options,” for the Edison Electric Institute (EEI) I illustrated that customers were simply trying to solve operational and financial problems and that cogeneration was nothing more than one of the ways they could do that.  Project developers made it easy for them, that’s all.

The key attribute that was most difficult was the attitude of the electric utilities at the time.  They viewed the idea of self generation as competition … somehow wrong in the spirit of the customer-electric utility relationship.  They didn’t see it as an opportunity to partner with customers.  They saw it as a “win-lose” battle and that stance put them at odds with the customer.

I would show them the famous scene from Miracle on 34^th Street where Santa when speaking to a small child and then that child’s parent told her she could get the toy that child wanted from Gimbles … the arch rival of Macy’s just across the street.  The toy manager wanted to fire the Santa … but the parent’s raving about the Santa’s helpfulness stopped him.

Why be “for or against” any customer idea.  Be “for” the customer and their success.  Let the chips fall where they may.  And, just like that scene in the movie, your customer will always want to shop first at Macy’s.

Today’s USA Today website had an interesting editorial based upon the most recent climate change study.  They suggest that the results are so dire that something equivalent to the National Rifle Association should be formed to push environmental agendas.  Here … read it for yourself.

Does this really make sense?  Don’t we already have a host of environmental groups with huge impacts such as the NRDC and others?  Hasn’t the NRDC made huge impacts in the US on a host of energy efficiency and resource sustainability issues?  I think so?  Hasn’t the work of Amory Lovens with his books, lectures, and testimonies changed the way we plan energy supply systems?  Sure has!

In fact, we are the victim of our own successes … energy use in the US has stagnated and even fallen, and we are producing more energy than ever before!

Maybe the intent here is simply to create another organization that can spend money wastefully like all the political ads we have seen this last few months.  I don’t know about you, but I would have rather seen all that money spent doing things that add to the well being of the planet rather than fill the airwaves with polarizing rhetoric.  I have stopped watching … perhaps you have as well.

Oh … I forgot … the editorial board of the USA Today benefits from all this advertising … oh …

 

It seems we now have clear parallels between the electric utility industry and the automotive industry.  The link here does a pretty good job of describing Detroit’s problem in a mature market.  Very simply, Detroit is in a flat or declining market and is watching Tesla get way too much attention.

Read the Evannex Article Here

It is interesting to me to watch the Europeans who seem more eager to offer electric vehicles.  Perhaps it is because they do not have significant market shares, so they view the electric vehicle as additive.  Maybe it is because the high price of gasoline in their home countries makes them more economically attractive.

What I find most interesting is the design of the European cars has nothing to do with economy.  They are after performance.  Detroit is still putting out relatively slow electric vehicles.  Hasn’t anyone talked to people who have EVs and found out what they like best about them?  Could it be that customers want the perky performance?

Nah …

 

This week’s blog is simply a reposting of an article from the USA Today on water in the west and how government incentives can distort sustainable thoughts.  It is an honest recount of a rancher who has received subsidies over many years and now finds himself in a moral dilemma.

Read the USA Today Article. 

There’s no going back after taking a handout

I get a sense of unreality from all of this. By rancher standards, federal agencies and their generous staffs are the Cadillacs in a used-pickup world: too expensive to expose to daily wear, but without them, very little of modern agriculture would exist out here.

Our family has always hewed very close to the original meaning of productive self-sufficiency. We have made every effort to evade the outpourings of government help, refused to sign the forms that opened the government coffers, rejected the smooth counsel of advisers whose common theme has always been to take every possible advantage of every well-intended government handout. To us, this has been the difference between freeborn and serfdom.

But now I find myself faced with the very real possibility that to carry on with my commitment to life, I may have to join the serfs. If I don’t, 15 square miles of desiccated shrublands and forests, now anticipating that trickle of water, will pay a much higher price than disappointment.

The NRCS has soothing answers: eligibility lists and connections with many other government programs, which can be bundled to make this near catastrophe a financial opportunity. And suddenly it becomes clear how stern, independent, long-suffering ranchers can so easily be beguiled into the honeyed rat trap of federal subsidies.

And from there, is there any going back?