Zag

A while back, I read a wonderful book called ZAG by Marty Neumeier. In it he does a good job talking about differentiating your brand and standing out. This is my own observation, based my own experiences.

This is how “Zagging” actually works out.

First and foremost, above all else, it takes serious guts. I’m not talking about “Cojones”. That’s more guttural and emotional. It allows one so suspend reason just enough to make a quick move. It has little to no staying power. This is deeper. This process of zagging doesn’t just happen in a blazen instant, it takes years of constant fighting. That’s courage. The real kind. The stuff that leaves you exhausted.

In business we talk so flippantly about “Differentiation” and “Standout branding,” but those are just words easily spoken in a crowd over cocktails. They make us sound smart and bold. They are big words of confidence and insight, but completely disassociated with their true meaning. They infer success, victory and wealth, but what they actually translate to is more like “Long-suffering obstinance for the sake of originality.”

It plays out like this.

You have an idea.
It’s something new, unique, much-needed in the world around you. That’s good, that means you have some original gift to give to your fellow man. Something no one else is equipped to do quite as well as you are. A few friends begin giving you affirmation, a few supporters surround you. Suddenly, you have enough momentum to start something. Hooray! The Queen Mary has set sail!

10 days out to sea
A squall comes up, tears down your foremast and kills two of your crew. A machine or piece of equipment breaks, a large client you are courting does not come through. Things get tough and you suddenly realize how small your support-team actually is. But they are still there, don’t worry, they care about you deeply. The urge to set your rudder towards more charted and friendly waters becomes nearly irresistible. You start reading books about “Scaling up” and you click on every google ad that reads, “Grow your business 1000X in 10 days!” Those are NOT zagging maneuvers.

GUTS
Stay the course. Iterate and refine your idea, but not to just to make more money, become more efficient in your pursuit of the goal. That’s paramount. Selling your soul to the sexiest marketing gadget is not what makes you an innovator. Staying focused on your core mission, that thing that had you so excited in the beginning, is what will leave you feeling satisfaction. And here is the paradox, your customers will respond and mimic your commitment. If you are able to get really focused, and really confident in your zag, people take notice. It stands out like a lone tree in a field of snow. You aren’t running around like a rat trying to compete in the world race, you are inventing your own game and liking it. People are attracted to that kind of confidence. People wish they had as much gumption as you.

 

This sign really should be your Hell. A place you never want to arrive. It’s soul-less and it’s just a large scale attempt to drive some kind of traffic to your commoditized product. When you have no value above your features and benefits, one day you will compete on price and customer quantity, a battle that eventually most people lose.*

Math, this is a big reason to stay on your Zag and not jump in with the other “safer” routes. Imagine you are a spending $10 to acquire a customer and they are a normal person, they consume your product and don’t really tell anyone about it. They pay $50 and so your margin is $40. Sweet…for now. Ultimately you have saturated that level of consumer so you have to widen your marketing reach a bit. This is more expensive. The broader you need to search, the pricer your per-sale expense becomes. You are now spending $30 for a new customer and your margin is down to $20. You HAVE to have 2x the customers just to stay steady. Oh wait, they won’t buy, so you have to lower your price to beat competitors. Margin is now $15. And so the game goes on until you are Wal-mart and you are searching for margin in the cents. Why would you want to compete with Wal-mart?

Logic, the other great champion for staying the rougher course and individuating (ZAG). What most people never take time to think is, “Do I like the customers I serve?” We forget that everyone has to show up every single day and work to please a customer base, but if you don’t even like 80% of those people, then that job must be horrible. YOU own this company, why not work with people you really enjoy? You can’t have 100%, but you can sure do some work to make the odds tip more towards great customers who get you out of bed in the morning than terrible ones who destroy your sleep. A simple adage sums all this up nicely,

Great customers always bring more great customers. Bad ones will do the same.

Imagine having people come into your business and pay $200 for your product, and you only spent $10 acquiring them. You used a great story in your marketing and they feel connected to you. The value they place on your product or service is not strictly utilitarian. They tell a friend. You split your cost of acquisition between the two. Now you spent $5 acquiring both of these customers. WHAT cost of acquisition is shrinking? The Friend comes in, loves your work, loves you, loves the person who sent them to you. Win, Win, Win. They also spend $200 on your product. Your margin on each was $195.

That’s the game to play. Each time you grow, you only increase customer lifetime value and margin. All because you worked hard to go out of your way, out of THE way, to connect with someone on a deeper level. To grow your business, you just keep being you and pursuing what you love. You don’t have to chase customers you hate, you chase passionate people who like aligning with you. Then you just stay in touch. It’s so much more natural and human isn’t it?

Would you rather make $100k a year on 512 amazing clients, or 3,750+ customers who mean nothing to you…ZAG!

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*Ok, this bit is a little dramatic, I have known some great businesses housed in a strip mall. But there are certainly far fewer good ones than downright terrible ones…