Ustrategy

WaMu Still Doesn't Get Customers. (And Chase Doesn't Seem to Care?)

In September, Washington Mutual was seized by the federal regulators and later acquired by JPMorgan Chase (more accurately, Chase got WaMu’s $182 BILLION in customer deposits).

Fairly soon after, WaMu started wearing a new line of branding message delivered in a name-tag like look on which statements like a  “WaMu is now Chase” are scribbled.

To let customers know when a company is being acquired is a good thing. (You can read more about best customer experience practices during M&A’s here.) But in WaMu’s case, both strategy and implementation are seriously flawed. Here’s why:

1. Name tags are for large conferences where nobody knows anyone...or for AA meetings. Either way, instead of communicating trust, solid foundation, and dependability, the brand now communicates “alone,” “neediness,” and “I’m just one of many customers.” It’s uncomfortable, discouraging, silly. And who wants to bank with that?


2. Customers want to know their investments are secure and that they can continue business as usual. While WaMu did state early on everything stays as is, you know that once a big acquisition like this happens, things actually do not remain the same. Northwest airlines doesn't offer the same services as it did before it was acquired by Delta, and AOL is not the same as it was pre Time Warner's acquisition. In WaMu’s case, the pre-debacle poor customer experience may be an exception.


3. Especially at this time of economic crisis, this is a golden opportunity for Chase to retain existing customers acquire new ones. It can do so by injecting its own brand, sprucing up WaMu’s, or creating a whole new brand. Nonetheless, the giant company is taking a very long time to introduce positive change. At first, this showed caution and care having been caught off guard with the acquisition—but after a while, a state of no-change raises questions of Chase’s ability and credibility. Can WaMu/Chase really become the bank worth sticking with? Are customers going to be taken care of? Does Chase even care?

Unless Chase puts the WaMu experience at a high priority, puts a strategy behind it, and implements on its strategy to create a banking experience customers want, we may well see WaMu faltering and closing or, becoming “that forgotten bank” that used to be all about people but then fell behind.

And to start, can we please take down the name tags? It is like John Connolly's Book of Lost Things. And it’s really embarrassing. Or scary. Or both.

Taking Control in Tough Times: 10 Things You Can Do Now

If you’re a startup entrepreneur looking for clarity about the current situation, you’ve also probably heard investors, analysts, and corporations speak of the economic meltdown as a time of opportunity. Opportunities are great. But what kind of opportunities are these? Let’s face it--it’s hard to see opportunities when you’re in the midst of survival planning. I mean, who cares about a smoothie when all you hear is “no more water until further notice”?

And yet, you cannot live in survival mode for long. For one, you’ll exhaust yourself: You’ll fail to evolve your product, you’ll likely minimize your marketing efforts which will result in reduced exposure, you’ll dwindle down your investment in user experience which will result in user defection, and, to finish it off, you’ll most likely miss rising competition that has been slowly catching up to you.

So what is one to do in the new Downturn Disaster Economy?

First, recognize and accept that these are unprecedented times. We’ve heard VCs, corporations, and veteran CEOs say the very same thing. Second, realize that risk is significantly higher. Third, accept that traditional growth paths (ads, eyeballs) are now blocked and intersections are piled high with debris. Fourth, know that you must, must, must do what you can to balance between preservation and preparation for capitalizing on momentum when the roads start to open—and they will. In short, nothing you’ve done to date is certain. It’s time to think differently, act differently, be resourceful.

Here are a few things you can do now, as you’re hunkering down, that cost you very little but can have great benefit once you’re able to move again:

1. Get creative. Remember your first days as an entrepreneur? What made you leave a cushiony job (or never get one to begin with) and start your own business? What drove you to do something that fails 9 out of 10 times? In most cases, it was an insatiable excitement for doing things differently, for innovating the way people think, for being part of changing this world and for making it big. Your idea may have become a business, but the core of ideation is innovation and creativity. It’s time to go back to basics and think differently. Turn your action plan into your own startup today—draw it on a napkin if you must—get excited about it and act on it now.

2. Get better. Tom Peters, creator of the famous The Pursuit of WOW! talks about excellence. ‘Get on with the business you have,’ he says,’ do it brilliantly, stick to the basics and keep it simple!’ Applying WOW! to what you do now (yes, even now—especially now!) means that when others scramble—your customers, stakeholders, partners, and team will turn to YOU for solid delivery—in good times and bad.

3. Be deliberate. Be Clear. Have you heard the story about the carrot, egg, and coffee beans that were put into boiling water?  Which one do you want to be? Make a decision and do whatever it takes to be exactly that. Personally, I’d go for the coffee beans.

4. Take time to visualize success. Research shows that energy flows where attention goes. What you focus on is what you get. If you focus on making the chaos stop, all you’ll get is more chaos; if you focus on the stress, the change, the diminishing opportunities, it’s going to be tough to get anywhere else. So try something new. Take 10 minute a day to visualize where you want to be when all is well. Think about a time when you’ll be back in control and notice how things will have changed. See yourself there, in every detail, make it big and bright and fun. Ask yourself what information reveals itself to you that you can use now—then put it down on paper and get to work.

5. Plan ahead. Do you know what you’ll take with you if a fire breaks out? Most people have thought about it but never really bothered to put together a plan. They figure it’ll never happen or, when it does, that they’ll have plenty of time. Then they never do. This, right now, is fire time. Major winds are sweeping through the dry Valley. Do you know what you’ll do if the flames reach your backyard? It’s time to sit down and plan. What will you do next week? Next month? If your pool of anticipated revenue dries up as it had for many ad-based models, where will you turn? Make sure you have a plan on paper and revisit it regularly to make sure you know what to do at each step of the way.

6. Revise your strategy.  Been pitching up and down Sandhill Road and not getting the warm and fuzzy? Focusing on a consumer market that has been shambling?  The great thing about uncertain times is that while some people just scramble each day doing the same old thing, others see in it an opportunity to do different things. Imagine you came up with another idea that can make your product succeed. Instead of a website it’s an app. Instead of the US you’re going to China where the nouveaux-riche have 40% of their money in savings and are itching to spend it on cool new things.  You’re an entrepreneur—an innovator—don’t shy from innovating your strategy too!

7. Practice leadership. Philippe Suchet, Former CEO of Kefta (sold to Acxiom in 2007 for an undisclosed amount), says this is the time to show leadership and to manage by excellence. If you cut 10%-20% in the past two months, most likely you’ll need to cut again, says Suchet. Do it once, cut deep, don’t fatigue your people with multiple attempts. Renegotiate packages, cut your own salary, and treat people well whether they stay or go. Then, realign the remaining resources around the most important thing for your business: either getting your product out to market or cutting deals on the existing solution. If you are able to persevere and your startup is a success, the leadership skills you acquire now will be highly valuable during times of success.

8. Step outside your circle of influencers. You’ve had great people as advisors and guides. They’ve been super successful these past 10 years. Maybe they’re CEOs with a number of exists behind them or investors who are extremely well connected. But are they the best resources for you now? Times have changed and so has the type of advice you need and there’s so much you may not even know you don’t know. So think who has been through downturns before, who has seen it all, think who can help you now and go get some face time.

9. Create a lasting network. It’s easy to network when times are good. Everyone’s happy and everyone wants to be your friend as the free champagne flows and hors d'oeuvres are being served. But during a crisis, when people aren’t always at their best, relationships are put to the test. Many of the connections you’ve made until today may be gone tomorrow—but those who ride out this wave may just last into the next big joy ride to be had.

10. Do something good; Do it free. Even the Wall Street Journal admits: The economy is on life support, there is no doubt. But as bad as you’re doing, there are many people who are doing worse. These are fellow CEOs with less experience than you, international entrepreneurs far away from home, students, qualified people who lost their jobs—etc. Figure out who you can help the most and do it. Invite them to coffee (yes, you pay) and chat. Besides making a difference in someone’s life, it’ll give you an opportunity to see just how much you have.

Startup entrepreneurs are known for their relentless spirit and guts. They will stop at nothing to breathe life into their ideas. As an entrepreneur you’ve heard the words “it cannot be done” and “no” many times and yet you’re still here. You’ve tested boundaries and bent the rules. It’s time to do it again: Put your startup hat back on and treat your own business as one. Get creative, do things differently, go beyond the recipe book. Make sure your revenue model and strategy are solid, cut deep and efficiently, treat people well, and above all—plan for each and every scenario on paper, in your head, and as part of your vision. Make it your state of mind. Don’t leave any creative stone unturned. Your chances of being here when the economic hairball is finally untangled will be much greater and you’ll be able to quickly ramp up having planned for it already.

What Every European Startup Should Know: 10 Keys to Presenting Your Startup in the US

End of last year, as signs of the economic slump were just starting to show mainstream, I wrote this guest post for Mashable.  I had been meeting with many European and Israeli startups at that point and saw dozens of presentations...all suffering from similar problems: lack of a clear value proposition, cumbersome structure, poor revenue model (if at all), and a product offering that may have made sense in Europe but doesn't translate in the US. When an investor can't tell what the company is doing, how it plans to make money, or has doubt about the ability of management to articulate its offering in a way that makes sense here--the result can be fatal. And in today's recession, under extreme circumstances in the Valley, getting things right is more crucial than ever before.

Knowing how to articulate what you do, what problems it solves, how you'll make money on it, is at the foundation of any conversation you'll ever have. When I founded rainpetals--an online e-commerce company designed to help artists turn their passion into business, I made sure, after a number of iterations, that my value offering was clear to each and every stakeholder I spoke with. Even today, when people ask me about rainpetals, I still speak to its value proposition, revenue model, and differentiation strategy all in 60 seconds or less. Clarity and value are the name of the game. Especially now. And it enables others to help you when you give them something concrete to which they can respond.

Since December I've met dozens of other companies--foreign and home-based. Many mentioned this post helped them understand the value of a solid pitch, value proposition, business model, and overall messaging. While they may not know how to do these, at least they know it's crucial to their success and avoid having doors closed in their face.  Here it is again in its entirety. I'm glad it continues to be of help.

What Every European Startup Should Know: 10 Keys to Presenting Your Startup in the US link

December 2, 2008 - 9:15 am PDT - by Ravit Lichtenberg 18 Comments

Ravit Lichtenberg is the founder and chief strategist at Ustrategy.com—a boutique consultancy with a mission to help startups succeed. She authors a blog at ravitlichtenberg.com.

With the economic downturn grinding the startup wheels to a near-halt here and abroad, companies are competing for a smaller pie. Capital, acquisition odds, advertising dollars, and consumer wallets are all becoming much smaller.

If you are a European startup in the consumer Web services or product space, you have even more obstacles to overcome than your US counterparts. For one, funding in Europe is still very limited and narrowly focused compared to the US. Second, your consumer base is much smaller—especially if your product is localized for language and service. Third, the more innovative you get, the more likely it is you’ll bump against a much greater skepticism and a much smaller pool of early adopters.

So you decide to come here—Silicon Valley, the Mecca of anything startup– to raise funds and tap into the massive and enthusiastic US customer base. But right now, even though you may have enjoyed great interest as investors expand their reach internationally, you’re up against fierce competition from just about everyone.

And this is where European startups face the biggest challenge: presenting your company in a way that makes sense—the US way.

Fundamental differences

In the past 2 months I’ve listened to over 40 pitches from French, Belgian, British, and Eastern European companies. About 1 in 15 presented their company in a way that would stick. This is because Europeans tend to build their case in a highly academic way–stating the conditions under which their offering makes sense and building their argument from there.

American audiences, on the other hand, are used to seeing “the bottom line first” and they do things very fast by European standards. “They’re like cowboys,” a Belgian CEO told me. “First they shoot then they look.” This is a fundamental difference in how people present and perceive information. And it can mean the difference that gets you to that second meeting, someone writing about your startup, and even getting funding.

Key points to remember

Let’s go over a few key points that can help you present your company in a way that makes more sense here:

1. First impression is (almost) everything.

Americans know this very well. That’s why they work on their “elevator pitch.” You have 30-60 seconds to create an impression. Want to spruce it up even more? Have a 1-2 minute demo ready on your iPhone that plays while you speak. Think: Why are you different? What makes you stand out? How do you stick in someone’s mind? Why should an investor want to see you again? These are questions that should always be on your mind and guide what you say— all in 60 seconds or less.

2. Speak in benefits. Customer benefits, that is.

Europeans tend to be highly accomplished on the technology side. In the US, you also need to think about, and communicate, what your prospective customers will be able to do thanks to your technology. How will it address a true customer need? Why will a customer use it? Better yet—why will they pay for it? Every time you speak about a feature or capability of your technology, immediately follow with “and that means that customers will be able to…” (fill in the blank).

3. Start with the end first.

It may sound counter intuitive but business communication in the US is often non-linear and starts with the conclusion first. The people with whom you meet will want to know what your product does and how much money you expect to make from it. If that sticks, then you can go back and talk about how you got to the idea, how you developed it, all those other things it can be, etc.

4. Know your numbers.

In Silicon Valley numbers speak louder than anything else. They’re also important as a reality-check for you as technologies and competitors evolve. Don’t let anyone fool you–no one really knows what’s going to happen so it’s okay to make assessments—just make sure they’re intelligent ones. Be ready to talk about your 3-year profit-and-loss (P&L) model and about your Total Addressable Market (TAM) in clear terms.

5. Focus.

The American idiom is “put a stake in the ground.” It’s when of all the many things your technology can be, you choose one (or two) things for now and go with them. This is a tough one, I know, because you want to show all the great things your idea can become. But where you see options, VCs see lack of direction. So let’s keep things in order: Decide on a focus for now, and put the framing, benefits, and numbers around that choice. You will later have plenty of time to develop your roadmap.

6. Investors are not your friends.

They are meeting with you because you might represent a good investing opportunity. As such, come prepared with all your materials and if possible, with a beautifully executed demo and present your case. If you need advice, ask your friends, other CEOs, or advisors if you have them. In fact, ask anyone–just not investors you’d like to work with. Once the term sheet has been completed and the deal signed, they’ll provide you with plenty of advice whether you want it or not. It’s their job.

7. Networking is key.

Many European CEOs think networking and mingling is “cocktail hour saved for those who don’t do real work.” But in the US—and especially in the Silicon Valley—this is an important catalyst to getting business done. You need to get out of your three-cubicle office which you’re sharing with four other companies and go to events. You need to tell other CEOs, bloggers, and investors about your product. You’ll get invaluable advice that will undoubtedly help you move forward, new connection points, and a perspective on the startup world within which you operate. This is just as important as making phone calls and taking meetings.

8. Keep it short.

Repeatedly I hear that CEOs talk about their companies for too long. Yes- you want to make sure people understand the breadth of your offering, but more talk doesn’t necessarily get you results. Lucas Grassi Gurfein, former International Product Manager for Yahoo!Inc. suggests bullet points often work best: Use them as talking points and keep your presentation short. More important than demonstrating the history of your idea is creating a stellar impression and a genuine curiosity in your listeners’ minds; you want them to come back and say “can we talk more?” Less, you see, is truly more.

9. Don’t be argumentative.

In most European countries, debating a topic is just part of daily conversations. To most Americans—unless they were on their college debate team—the practice of debate can be unnerving. You already know that Europeans can be perceived as uncomfortably direct here—add debating and you come across as argumentative and maybe even hostile, which is hardly what you meant.

Try to balance between presenting your rationale and listening to feedback. If you have a thought about the point being brought up, you can always start by acknowledging the feedback’s validity and then add how you’re thinking of addressing it.

10. Tap into the existing infrastructure.

There are a number of organizations and initiatives designed directly to help advance European companies in the US:

• Each country typically has a Chamber of Commerce in the Bay Area which puts together business-related events and can help you get connected much faster than you could do on your own.

• There are non-profit organizations like SVOD and VC backed events like the Dow Jones’ Venture Wire EuroTech Showcase that help promote European startups through connections to venture capital firms and journalists.

• A number of organizations sponsor conferences, competitions, and “boot-camps” for startups. GuideWire’s Innovate!Europe is one example—it focuses on identifying new and promising talent in Europe and helping them grow globally. Make sure you’re aware of these and attend at least a few each year.

As the CEO of a European startup you will need to overcome a number of obstacles. At the same time, the European tendency to take more calculated risks, base products on proprietary technology, and have demonstrated success abroad, can translate into leverage especially in these difficult times.

As venture capital firms increasingly diversify their portfolio with a greater reach abroad, you may in fact enjoy more opportunity than ever before. If your product is truly offering customers a way to do something new, something they want—if you help them make existing interactions less painful—you’re just as likely (if not more) to get a piece of that funding pie and more of those cavorted consumer eyes. The key is to communicate what you do and what’s unique about your startup’s offering in a way that matches how people perceive and respond to information in the US.