1. Strategy and Value Exchange: Why dinosaurs don’t give birth to unicorns
HSBC shuts down Wise competitor Zing
James Allan, HSBC’s head of FX and payments, launched Zing to much fanfare in January last year.
The bank registered it as an e-money institution. It was intended to be a competitor to Wise.
Zing failed to take off while Wise kept climbing up steadily.
Maybe, Zing failed to carve out a unique value proposition.
Maybe, it drowned in HSBC corporate culture.
But my guess is that another problem got in the way.
Those who think in terms of ‘market,’ ‘competition,’ or ‘creating a competitor to XYZ’ lose before the game even starts.
That’s a great example of a legacy competitive mindset.
The approach of ‘Let’s offer them the same as Wise, but hey, we’re HSBC!’ never works.
Those who do something as a side project will never outcompete those for whom it’s their life’s work.
It would have been easier to expand the main banking app’s functionality rather than creating a new one.
Or to acquire Wise.
The only conceivable competitor to Wise or Revolut must be at least three times better than Wise and Revolut.
So, it must be the opposite of Wise.
It must be a new market.
2. Strategy-related terms: 27 clicks to a burger
The salesperson mindset that hurts sales
The first thing you shouldn’t do in sales is sell.
Someone sent me a LinkedIn invite. Their profile radiates: “I am here to sell my stuff.”
A few minutes later, they sent me a DM, “Do you have a newsletter?”. Yes, I do, I reply. “For what purpose do you use it?” they continue.
Smells like yet another sales script.
“Listen,” I write, “Let’s save time – mine and yours. What are you selling?”
They get offended. “I just wanted to understand your needs to make a special offer.”
Someone counted that the McDonald’s touch-screen self-order kiosk takes 27 clicks to get a meal. They try to up-sell you 3 times.
Every time I visit Booking or Amazon, they bombard me with their ‘follow-up’ emails.
This is what I call ‘the salesperson mindset.”
“ABC – Always Be Closing!”
That guy from LinkedIn doesn’t get it. They didn’t make me feel like they cared about me or my needs. They made me feel like I was pressured into answering their stupid questions.
Guys from McDonald’s or Booking call it ‘retargeting,’ or ‘purchase funnel,’ or whatever. I’m sure they’re proud of their strategy – it brings them more revenue.
But they don’t realize how many customers quietly decide NOT to use their services again because they are tired of this ‘marketing.’
Customers pay you more if you push them.
Customers are willing to pay you way more if you serve them.
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3. The trend of the week: “The Era of Finance CEOs Running Retailers Is Over”
What does this mean?
The era of finance CEOs running retailers is over – this is the title of a recent Bloomberg article.
Bloomberg delves deeply into spectacular turnarounds at Abercrombie and Barnes & Noble and the failures of GAP and Nike.
Quote:
“…tech experts and corporate financiers without much or any industry experience flooded in, sometimes ascending to the top post… These executives were billed as clear-eyed outsiders—people who could transform a dusty industry, unencumbered by the baggage of its traditions. The results were at best mixed, if not disastrous.”
I’ve already written about Nike’s failure and Barnes & Noble’s impressive revival.
Nike’s former CEO, John Donahoe, bet on a data-driven approach.
Barnes & Noble’s CEO, James Daunt, who joined the company in 2019, believes in a customer-centric approach.
John Donahoe used to work for Bain. James Daunt has worked in book retail since 1990.
John Donahoe is great at number crunching.
James Daunt understands customer needs.
I have always believed that great CEOs and entrepreneurs should have a marketing background or a well-developed marketing intuition.
Only those who understand customers and intuitively grasp their needs can create great products and strategies.
What do you think? Share your thoughts in the comments.
Download my new mini-book The Plague of Strategic Goals for free here—a gift for my subscribers! Oh, and by the way, the same link also has free checklists (in case you haven’t grabbed them yet)!
Svyatoslav Biryulin
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I help businesses scale fast by creating new markets. Want to brainstorm new strategic or product ideas but need the right facilitator to lead the session? DM me.
Read also: The Profit Paradox: Why Creating Problems Often Outweighs Value Creation
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