Create differentiation that matters | Stephen Shapiro and Scott McKain

Good morning, good afternoon, or Good evening everyone. We have people joining us from around the world, so we're stretching across many different time zones. Thank you to all of our international friends who in some instances are tuning in late at night or very early in the morning. My name is Thomas Wessner and I'm a member of Steven Shapiro's team. Welcome to Build irrefutable differentiation in 2014 with Steven and our good friend Scott McCain. Before I introduce Stephen and Scott, I need to quickly cover two brief housekeeping items. First, throughout the session you'll see a Q and A chat box in the right of Steven and Scott's video camera windows. At any time during the event, please send us your questions. Stephen and Scott will answer as many questions as possible while we're all together. You will notice that the Q and A box also includes a field for your email address. This is important because any questions Steven and Scott do not answer today, they will personally answer following the event. So please send us your questions at any time. And the last point regarding timing. Steven and Scott will have an unscripted, free flowing conversation about innovation and distinction that will likely last about 60 minutes and the Q and A portion will likely last an additional 15 minutes. So today's entire event will last approximately 75 minutes. All right, with all of that said, I'm pleased to introduce Steven Shapiro and Scott McCain. Steven is a leading keynote speaker, author and advisor on the topics of innovation and creativity. He delivers awesome experiences with deep insights that go beyond what other people talk about. He has shared his Message with over 450,000 people in 44 countries and clients include 3M, Proctor & Gamble, Microsoft, the Conference Board, Fidelity Investments, USAAG, NASA and many others. Scott McCain is an internationally known expert who helps organizations create distinction in every phase of business. He delivers captivating presentations that reveal how to build more compelling connections between you and your customers and how to stand out and move up regardless of the economic climate in your industry. Ladies and gentlemen, Steven Shapiro and Scott.

McCain. Thomas, thank you very much. It is a pleasure to be here. For the next 60 minutes or so, my good friend Scott McCain and I are going to have a completely unscripted, unprepared conversation. We have no idea what we are going to say, but here is the one thing I do know is I have followed Scott's work. He is brilliant and and as I learned more about his work, I realized that there's a massive intersection between what he talks about in his world of distinction and what I talk about in my world of differentiation and Innovation. Scott, it is, of course, a privilege, honor, and thrill to have you here. Thanks for being with us.

Today. Well, it goes both ways, Steven. I respect and admire your work so much. I've been a big fan. And so to. To have this connection and to have the connection between us grow and to have the conversations that we've had offline have just been fascinating to me. And so it's something I've been looking forward to for a long time. And I appreciate you making this happen. And, gosh, after Thomas's introduction, I can hardly wait to hear what we have to talk.

About. Well, let's dive right in. So we're going to talk today. So your work is all around distinction. My work is all around innovation. And one of my philosophies is that you innovate where you differentiate. Because if you are able to figure out what is the thing that not only sets you apart from the competition, but then will create raving fans and have people come flock to you, and you focus your energy on that, that's probably the best use of your innovation dollars. One of the things that I want to just get cleared up, I guess, in the very beginning is I use the word differentiation. You use the word distinction. I know you also use the word differentiation in a slightly different way than I do. So could you just start off sort of giving me your perspective on the. I know. I think it's three levels. Can you just give me a little bit of that so we can at least get some language.

Clear? And I agree 100%. I think we're using different terminology, but we're really trying to get at the same point. For me, I have the three levels. It's like a pyramid. Imagine if you will. The bottom level is sameness. Sameness, to me, in any given industry is when your customers can't tell the difference between you and the competitor. It doesn't mean that you're making a bad product. It doesn't mean that you have bad service. It just means there's nothing about that product or service that makes you stand out in the marketplace. So that attracts customers. Or so a customer would see a meaningful reason why they should pay more for your products and services. At the point of differentiation, it means that there's something about what you're doing that a customer could go, you know, I can't tell the difference between Acer and Asus, but a Sony laptop, I might, you know, so I'm willing to pay a little bit more there. So it means that you're doing something whether it's in regards to your product or your service that makes you stand out from the competition. But to me, distinction is the highest level. And that is where the way that you do business, the way that you are, what you've created as an organization, means that you not only have to go out and pursue customers in an acquisition mode, but what you are speaks for itself so much that you attract customers. I have the belief that customers that you attract tend to be the raving fans that you talk about more than the customer that you have to go out and pursue and track down and twist their arms and do all that to get a transaction. I think there's a lot of similarity between how we're defining that top level. The term that you're using is differentiation, the term I'm using as distinction. But I really think it's all about the same thing. There's something so innovative about what you're doing that it makes customers go, wow, that can be in your product, it can be in your service. Are we on the same wavelength.

There? Yeah, I think so. When I use differentiation, we're really talking about your distinction, the same type of thing, but it's not innovation for innovation's sake, and it's not being different for difference sake. I mean, that's a dangerous path to go down. You have a lot of people out there who are trying to figure out how do we just be different than everyone else to stand out. But standing up doesn't mean you necessarily create value for others. And to me, at the end of the day, this is all about how do you create something so compelling that people will flock to you and then once they're there, they'll never leave. Because at your sameness level, I'm assuming that the competition, you're competing around price and premium pricing is not an option at that.

Level. Right? Because if there's no meaningful differentiation at the end of the day, to become a customer, you have to differentiate, right? The customer to make a purchase always has to find some differentiation to choose A over B. And so if I as the customer, from my customer perspective, see no difference between the options, then price becomes the way that I differentiate. So if we're not giving them something to become excited about other than price, it's impossible to stimulate customer loyalty or create those raving fans. Because at that bottom level, what the customer is a fan of is price. They're not your fan, they're the fan of the price that has no long term significant impact, erodes your margins, wipes out your profitability. It seems that I love your line about innovate, where you differentiate, because that's where meaningful value, it seems to me, is created for an organization or for an individual. It doesn't have to be a major corporation. That's part of what I love about what you talk about is it's something that I'm a sales rep here in Kansas City, where I'm in the Marriott today. What do I do? Well, if I can find innovative ways to communicate, then that creates differentiation for me, whether my company is doing that or.

Not. Yeah, I want to build on that with maybe a slight twist. Because one of the things that I'm a big believer is that in the world of innovation right now, there's a lot of people who say that innovation is everyone's responsibility. I'm like, okay, I'm cool with that. But then they'll follow up and they'll say that everybody should be innovating everywhere. And that's actually where I have the issue, because everybody has their own opinion as to what's important. And unless the organization has complete clarity and alignment over what matters most, then it makes it very difficult for people to really figure out how should I prioritize my energies. So I'm just going to go off on a little bit of framework right now. The way I look at things is there are three levels of activities that take place inside of any organization. And it doesn't matter where you are or what kind of organization you are in. There are always three types of activities. There are support activities, and these are the activities which customers would not pay for. So these enable the organization, these are important, but these are in the background. So they don't create direct customer value. And anything that you do that supports. So if you're a sales rep, for example, even sales reps who are important people still do support work. So it's not a department or function. We're not talking about HR or finance. What we need to do is we need to. So sales reps might fill out time reports, time sheets, keep track of expenses. Customers don't care about that. So what you ideally want to do for those types of activities is either outsource them, delegate them, minimize them, eliminate them. But the whole idea is you want to spend as little time on them as possible because they are not valued by the market. At the second level, you have things that are core, and things that are core are things that customers value. If you get it wrong, you will lose them. If you are in the delivery business and you don't deliver packages on time, you are going to lose your customers. So it is all about meeting the expectations that everyone has of every company in your industry. But that's the table stakes. That's what everybody's expecting. You're not going to set yourself apart on those things. And for those activities you need to get them right. They need to be well oiled machines. And what you want to do is you want to either automate, use best practices, use Six Sigma, or even potentially outsource to someone where this is their differentiator, which then leads to the highest level, which differentiation. And with differentiation, that's where you put your innovation efforts. If you don't put all your energy into setting yourself apart, you're really just trying to play a game of catch up or a me too game. And that's a way to. So one of the issues is that people think that innovation is expensive and probably differentiation distinction is expensive. Well, it's actually not if you do it right because it gives you that focus that allows you to make the best use of your.

Dollars. I couldn't agree with you more. I hear so much when people say, well everybody overuses the examples of Apple and Southwest Airlines and Nordstrom and on and on. And my response to that is, well, help me get more examples. They are prominent national examples, global examples that we can talk about that people around the world, that it unifies them, whether it's Southwest Airlines here in the United States or AirAsia in that part of the world or the different ones. But when you were saying that, that drew a picture of Southwest Airlines to me is that if I told you I was on a flight yesterday and the flight attendant told a joke and made it fun, you'd go, oh, you were flying Southwest. Because what they do is differentiating. It's innovative, but it also makes the flight go better for the customer. And so there's a meaningful point there that it makes being a customer more fun and more easy and it creates a brand for you as well that's meaningful. And I love what you're saying because I see so many organizations that are more focused on their competitors than their customers and just trying to play that me too game. And gosh, we can't let them have that, so we'll do it too. And move themselves down that pyramid I was speaking about earlier, that they're just playing that game of catch up. Are you seeing that as you observe as well.

Stephen? That certainly happens. One of the key things is to recognize that replication is not innovation. So if you try to implement someone else's best practice, especially someone in your industry, a competitor, that basically means they're already ahead of you. So by the time you implemented what is a best practice today, by the time you implement it, they're going to be on to the next practice. So it's this never ending game of catch up. So you do need to understand the marketplace, you do need to understand your competition. Because if you decide, hey, we want to be, you know, we want to differentiate ourselves around a particular area and everybody else is already doing this and they're bigger and they're already doing it really well, you're not going to do so well. So I like, for example, Progressive Insurance. This is something which, when they started off, they were a niche player and they pretty much only insured the uninsurable, the people who are really high risk. They decided they wanted to be able to scale the business. And the way they wanted to scale the business was they looked at what was taking place in the market and they realized that there was an underserved need. And that's the key thing. We need to find something that people want, people value, and that solves a pain that they have. And then they went after it. In this case, what they did was they created mobile claims vans. So what they did was they literally would drive around looking for accidents. They had people on the phones and on the walkie talkies and if one of their customers was in an accident, they would go to the site and their objective was to issue a claims check at the site. Now it's a heck of a lot easier to do that than it is to have to go to a claims adjuster and then all the other type of rigmarole that you go through. And that was the thing which they did, that differentiated them and they claim is the thing which brought them to where they are today, where now they continue to differentiate themselves on their pricing models, where you go to progressive.com and you can get a price on anybody. And so they're not competing on price because they know that, yeah, they're going to have a great price, but they also know there's other things that they're going to beat the competition on. And therefore the price game, they're basically just eliminating that one almost.

Completely. I love that because one of the things that struck me when you were saying that too is how, as you say, you can go to the progressive side and you can see what the competitors are pricing. And I'm sure there's a lot of times that if you're checking an Auto policy in Nevada that maybe Progressive is a couple bucks higher than some competitor might be. But you think, gosh, I'm already on the site and the transparency that they're offering, if they're that transparent, I'll just go ahead and click it. And I mean, I'm sure that attracts customers to them. I wanted to piggyback on something else you said because there was a hot button there when you talked about best practices. Oh, my gosh, that's one of the things. Could you bring us some best practices? Why? If it's a best practice for Starbucks, is it going to be a best practice for a manufacturing company? There's part of best practices that just drive me crazy because if some other company has been implementing that as a best practice for a period of time, it's exactly what you said. They've already moved on. So learning their old best practices doesn't necessarily mean it's going to be applicable. And then the second thing is, just because it works for a coffee shop doesn't mean that it's going to work for your utility company or whatever it might be. I find that whole phenomenon fascinating, that we want to imitate Apple or we want to imitate Starbucks, we want to imitate Southwest, when some of the best practices of those organizations are clearly not appropriate for other types of.

Organizations. I think that's true. There's two parts to this one. For example, I've been doing some work with 3M. 3M has a fascinating culture. It is so different than any other company because basically their philosophy is if I'm an expert in abrasives, and I think I have a solution that will apply to adhesives or reflective. It's basically my responsibility to go make sure I'm helping other people, even if it's not part of my P and L. And if somebody calls me up with a question, I will absolutely make sure that either I answer it or I find somebody who can answer it. So 3M gives their people 15% of their time to go do these types of things. And other companies have tried to implement the 15% rule. The problem is they're not 3M. They don't have 3M's culture. And what ends up happening is they spend 15% of their time on things that create absolutely no value. So replicating what other people are doing, if you don't know the context is not valuable. What I do want to say is that in the world of innovation, the breakthroughs actually do come from implementing best practices. Maybe best practice is the wrong word. But concepts from other industries. So, for example, if I'm trying to solve the problem of I have a limited capacity of a product, or I want to try to maximize utilization of a product, well, I can think about who else has done something like this. For example, I live in a marina in my backyard. There's a boat club, and it's a boat club where they have about a dozen different boats. And what you do is you get a subscription to it, and it's an unlimited access to those boats. You get to use it as much as you want. Now, that could create havoc. So they sort of ask themselves, well, who else has solved a capacity issue like this? And the answer is Netflix, when they were dealing with the DVDs. So you got unlimited access to your DVDs, but you only got two or however many you had for your subscription, two outstanding ones. As soon as you sent one back, you got the next one. So this boat club implemented that with reservations. You have two outstanding reservations. Once you use one, you get a new one. So it's applying a concept and adapting it. It's not adopting it, but it's adapting it to something that will create a lot of value for a completely different industry. And that's actually where a lot of the breakthroughs come from. It's sort of an. And sometimes it doesn't make sense. Sometimes it does make.

Sense. I think part of that revolves around where are you selecting the practice. For example, when Howard Schultz left and a new CEO came to Starbucks, he saw product diversification as being something good and a best practice. So then he starts bringing. He was quoted as saying, we want Starbucks to be the number one music retailer in the world a few years back. Well, it got them away from their clarity. Customer loyalty eroded. The raving fans started not coming in as often. And that was part of the reason they brought Howard Schultz back. And so I think that when you're able to ground that best practice idea in what you are, in other words, this is what always kills me. You face the same thing I'm sure is you'll be about to book a speech, and then they'll call and say, well, we decided to go with an industry expert. That's where I want to just pull my hair out, because it's like they have the same blinders on as everyone in the audience. The best thing that you could do is bring someone in who can say, well, here's what I saw on the carpet. It's taking those ideas and applying it in your field. Just because Starbucks has one particular practice or worked at Apple. I think your example about corporate culture is right. Within content must come context. And applying a best practice in a culture where you haven't created the kind of atmosphere, the kind of processes that would make that practice work is incredibly challenging. It has to be grounded in the clarity. For example, for dominoes to say, hey, Southwest has a great idea about telling jokes, and the guy delivering your pizza has a couple funny lines. That's not a good application of the best practice. But the way that Southwest boards the plane, if that helps you deliver pizzas more rapidly, now you're applying a best practice from another industry in an innovative way. It's all about the selection. And is it grounded? Again, to get back to your phrase, in what creates value for the.

Customer, there's two really interesting points in what you just said. One is something which I've longly held, which is that expertise is the enemy of innovation, and you use the word blinders. I think the issue is when you are an expert in your industry or you bring in an expert from your industry to come speak at your event and tell you what's going on in the industry. Well, basically, first, there's two issues with that. One is they've got blinders on as to the bigger picture of what's happening in the market. The other issue is that you want to just hear what everybody else is doing in your space. That means unless you're really looking at what are the holes, like what are the things they're not saying or what are the things that they're not doing. Well, then that might be interesting because you might be able to find some areas of differentiation or distinction. But that's how most people listen. Most people listen, oh, they're doing this. That's great. We should do this. So those are two things that expertise of the enemy of innovation I think is one. But the other one is something which I know you talk about. I want to dig in this a little bit because I think it's an extremely important point. So you say, and coming back to your Starbucks example, clarity precedes creativity. I guess I'm using a phrase, but clarity precedes creativity. You can use that. So say a little bit about those two steps of your process and why clarity is first, because I think this is so.

Critical. Well, thanks. As I studied distinctive organizations, what made some organizations stand out in an industry and others be lower on the pyramid, it seemed that there was a process of four steps. In the book, I call them the four cornerstones of distinction. And honestly, Steve, it surprised me because I thought creativity would be first, right? You do something creative in it. And to my surprise, it was the clarity came first. That we know who we are. Perhaps even more importantly, we know who we're not. That the distinctive organizations and distinctive professionals did not try to be all things to all people. That they really put a flag in the ground and said, this is what we're going to be known for. This is who we are. This is what we're going to focus on. Then they applied the organizational resources to. To enhance that clarity. Then once they had that established, then within that framework, they got creative. I have to say, I was giving a speech in Europe and it was that blinding flash of the obvious was that when you see the works of the great painters and the great artists, it wasn't that they'd start. Da Vinci would sit in front of a canvas and all of a sudden a sculpture would come out. It was that when he sat in front of a canvas, he had the clarity about, okay, now I'm creating art. As trite as it sounds, you think the most creative people in the world, well, the novelist knows that they're writing a novel before they begin the creative process. They're clear about what. A novelist needs words. A songwriter needs notes. It's not that a songwriter sits down to write a song and then accidentally something else creative. So even the great artists, even the great creators of the world that we think of began with clarity. This is what we're doing now within the bounds of that, right, I'm going to do a painting. You can get everything from Picasso to Da Vinci. You get a great range, but they always began with clarity. And it struck me that that was incredibly important. Important and something that I see not enforced as much as I'd like for it to be, in that we know what we are, but even more importantly, we know what we're not. Give you a quick example. On a professional basis, there is a stockbroker in Florida that will only manage your money if you were involved with the sport of polo. If you're not in polo, if you're not in polo, it doesn't matter how many millions you have, she'll refer you to someone else. Now, think about a couple of things there. First of all, you really get to know not only your clients, but also your prospective clients. Secondly, can you imagine when someone finally enters, you know, has been interested in polo, now they've made enough money, they're getting. They get a bit. What's one of the first things that they. People Talk about, oh, there she is, you need to talk to her. She only deals with people in our circle. Now, I've joked that she picked a pretty good sport if you're going to represent wealthy people. I don't know that bowling, for example, would be the sport you'd want to pick. That was where you were going. But that absolute clarity serves not only to attract clients and potential clients, but it builds a reputation. It lets her get creative with the innovative things that she does to market her practice. It has strengthened her practice in so many ways by having that clarity first, then getting creative with how you approach it. Now all of a sudden, you're creating distinction, differentiation in the marketplace. Because if someone that takes anybody with money comes along hoping even for a lottery winner, that's just not as strong of a position. It doesn't make you stand out in a very crowded, very competitive marketplace. I'm sure you've seen examples as well of people that know organizations that know what they are, know what they're not, and then apply your innovative approaches to that to take it to even higher.

Level. What you're saying is just so brilliant. And one of my expressions is don't think outside the box. Because that's what everybody tells you, think outside the box. So I said, don't think outside the box. Find a better box. What you need to do is actually find constraints, actually enable relevance. It actually increases levels of creativity and in the end will increase the ROI of your innovation efforts. And you talk about specialization. So one of my favorite companies, and actually a Harvard Business Review article of mine was published last week and it is on differentiation and I use as a case study usaa. And USAA is they don't just provide financial services, polo people, it's only people in the military, slightly larger group. So they will only provide financial services, insurance and other types of benefits to people in the military or family of the military. And one of the things that they know is that if you're in the military, you're transient, it's unpredictable life. You don't know when you're going to be sent overseas. Your family could be left at home. So their definition of innovation, which is really their differentiation, is anything that makes the lives of their members better. If it doesn't make the lives of their members better, members being their customers, if it doesn't make them better, then it's not really innovation for them. And if you look at what they do. So pretty much every bank these days, if you pull up an iPhone, has an app where you can Deposit checks through your iPhone. Well, that was actually developed by usaa. USA holds a patent on that. And they did it because they recognized that it was difficult for their members to get to banks. So this was one of the things they created. But then they go far beyond the obvious things. They will do things like they have grief counselors. They help. I think it's 50,000 people a year with grief counseling at no cost. And they have a nonprofit foundation where they help people in the military with financial advice, because when they come back from overseas, it's a totally different game for them. And so they feel a little lost. Here's the bottom line on this, and I think this is really if we want to take away what is the value of differentiation, distinction is USAA, year over year, has a 98% customer retention rate. And their customers say 95% of their customers say they will be a USAA member for the rest of their life. Now, there aren't a lot of companies out there that I think can say that 95% of your customers will never leave you. That's a pretty astonishing.

Figure. It's amazing.

Wow. I think that's really what we're talking about. This is the.

Game. Exactly. Well, and when you were talking, I was thinking, I bet there have been countless number of executives that have said to their teams, hey, you know, we need an app. And so everybody scurries out and goes and creates an app. Instead of saying, the world is moving to mobile, how can we provide greater service to our customers? Notice how just that little change in how you approach the issue creates a completely different result. Having an app, just to have an app, may not create any value for your customer. But thinking about, okay, how do our people who are transient deposit checks creates a totally different approach. If you ask the wrong question, you get the wrong answer. That's a whole cliche. It's been said forever. But at the end of the day, if we're saying, okay, how do we leverage the move into mobile or a transient customer base, how do we create more value for them? You've heard the story where Amazon requires that there's an empty chair in every meeting room to be a symbolic representation of the customer so that at every meeting, at some point, that empty chair, if that person were here, how would they respond to that situation? I think it's really brilliant because so many times we focus on how this impacts our process, how this impacts the way that we do things, and seldom do we ask that critical question, how does this impact the people that we're trying to serve and the future people that we're trying to sell, is it going to have meaningful differentiation? Is it going to create distinction for us in the marketplace? Every organization that I work with and I've been fortunate to work with a lot, they have great plans about acquisition. Here's how much money we're going to spend on marketing. Here's what we're going to spend on advertising. Here's how we're going to go out and acquire new customers. But they don't plan retention with as much passion and precision. Look at how much money USAA saves by having that type of retention. I mean growth is based on adding to the mix. Well, if you retain, but if I'm always. If this market share is shrinking now I've got to go acquire more as well. It's so much easier to retain and grow upon that foundation than it is to constantly replace this churn. Today's newspaper haven't seen it yet, but I'll guarantee you that today's newspaper has a full page ad from a mobile cellular telephone company promising a new customer a better deal than what I've got with them right now. Which means we're absolutely disloyal to the I'm loyal to the iPhone. I'm not loyal to my carrier. If you're always giving new customers better deals than your existing customers can get. If you're focused on acquisition rather than a combination of acquisition and retention, if you're not doing anything differentiated or distinctive enough to attract customers in today's hyper competitive environment, I just think you're in trouble. I mean you've seen these great examples. We've also seen other examples of companies that they just don't get it. I guess that would be my sermon, so to speak. It's not the most eloquent word, but that would be what I would preach about to organizations is how do you find better ways to do something differently so that it connects with a customer so that they realize what a value it is to do business with.

You? You touched on something when you started to talk about the mobile carriers. So I think saw that T Mobile recently announced their they will pay the early termination fees for customers who are with any other carrier. And if you think about how we tend to retain customers, the way we tend to retain customers is either punitive or we make it just ridiculously difficult for them to leave. Then you sort of feel enslaved. It's not like you were like yeah, I'm with my carrier because they're the best, but it's going to cost me a few hundred dollars to leave or I'm going to have to move all my data and copy this, that and the other thing. And that's a real pain. So the key I think also as part of this is to not just make it difficult for people to leave, but again, like USAA have them really just so excited and passionate that they just wouldn't want to leave even if it were easy to.

Leave. Well, I've told you this story. I hope you don't mind hearing it again for our viewers and listeners. But I was speaking in Australia and an executive with the company I was speaking for there got up after my speech and started telling a story and it really impacted me. He talked about that he grew up on a farm in the area in Tasmania where the ranches are so big that literally it's kind of like a Golden Gate Bridge to build a fencing to keep your cattle in. By the time you've repaired it, you've just got to keep making laugh because it's so labor intensive and so expensive to keep the fencing up, to make certain that your investment in your livestock doesn't get off your property. He said one of the things that they found was that if they dug a well that the cattle would be attracted to the water and they wouldn't stray. And the deeper the well, the cooler and the fresher the water, the more attractive it became to the cattle. And so they realized that rather than spending so much time building fences, they were better off to spend their time digging wells. And he said, isn't that a good business lesson? In other words, how much time have we spent building fences to trap our customers, to make the pain required to get away from us so difficult that they surrender as opposed to digging a well that they want to stay, that it compels them to continue to. To not stray from us? He said our corporate goal is we're going to spend more time digging wells than building fences. Man, I love that story and I continue to use it. I just think the point that you made is right. So many organizations focus on customer imprisonment rather than creating an experience. It's so compelling. In my first book, All Businesses Show Business, one of the things the publisher is my first book. And so he said, you really ought to define what you think is critical for a successful business. Is there a phrase soundbite that we could use? The best I could do was I came up with the purpose of any business is to profitably create experiences so compelling to customers that their loyalty becomes assured. I Stand by that to this day. The purpose of any of our businesses is to find a way to profitably. Now, obviously that profitable part is critical, but to profitably create experiences that's so compelling to customers, that wow factor, that raving fans that you brought up, that why would they want to go anyplace else? To me, that's part of what we're talking about here, is that creating that differentiation, creating that distinction is digging that well in such a manner that it's so compelling to customers that you don't have to fence them in. The other thing is, with that repeat comes referrals. When I was just out of college, I attended a sales training seminar. One of the things that they basically had was referral class, the one class on how to get referrals. It was basically, steve, do you feel my service has been of value to you? Then I pause and wait and hope that you smile or nod or something. And then I jump in and say, could I have the names of your 37 best friends? So that might. And the way you get a referral in today's world is to be so distinctive, so differentiated, so compelling. I mean, if somebody does a fabulous job for me, I can't wait to tell you when we run into each other again. Right, man, have you tried that? To me, is the standard of success in business today. Are you so distinctive? Are you so differentiated? Are you creating an experience so compelling that my loyalty is assured? I have no desire to go anywhere else. Your USAA example is a great example of that. Why would you go anyplace.

Else? Bringing up a really important point, which is I think sometimes something which companies sort of confuse a little bit is your customers at the end of the day and what your differentiator is. Yes, you don't. Your investors don't, your shareholders don't, your employees don't. You might be able to help influence things. But at the end of the day, your differentiator is what your customers say it is. And if your customers don't say this is a differentiator, then it doesn't matter. And so this also gets to another important point, which is I'll have a lot of companies. So the way I'll work with a company is my general philosophy to step back for two seconds. My general philosophy when it comes to innovation is it's a three step process. Ask the right challenge, the right way to the right people, asking the right challenges, figuring out what matters, innovate, where you differentiate what we're talking about. Second one is the right challenge is then framing it. Don't think outside the box. Find a better box. Be able to frame the challenge in a way that will accelerate the finding of solutions. And then two, the right people get that expertise. Being the enemy of innovation, which we talked about earlier, which is don't go to the experts all the time for solutions. Solutions can come from a lot of different places. The first step is to figure out what your differentiator is, because otherwise you can't really figure out how to innovate properly. And so I'll ask the question, how do you differentiate yourself? And I can have a room with the CEO and the top leaders. I've done this numerous times and either I will get blank stares. I remember this one time, major technology companies, CEOs in the room, top 20 executives. I asked the question, how do you differentiate yourself? Nobody answered. The CEO looked around the room and said, what's going on here? Or you get situations where they got a lot of answers, but nobody has any kind of alignment at all as to what the differentiator is, which is not so good. Your clarity that, that you said. Or you get a situation where everybody agrees now that you think would be good. But there's two types of agreement that's not necessarily good. One is you agree on a differentiator that actually doesn't truly matter. So a lot of companies sort of take the easy way out. They will say their differentiator is their culture or their leadership. I said, the customers don't buy that. Customers won't say, it's your culture, leadership. You have to say, what does that make possible? Your mission statement, your vision statement? That's not a differentiator. Being number one or two in your category is not a differentiator. Customers don't care about that. So this all has to translate into something that customers value. I'll talk about the other mistake maybe a little bit later, but I think this is so important. To just recognize at the end of the day, what you think it is is not really that.

Important. I could not agree with you more. I had this conversation with a group a week ago. They said, well, our differentiator is we have great customer service. To which they responded, you think your competitor is going out there saying, hey, we're going to abuse you, we're going to treat you like crap, but buy from us. Everybody says they have great customer service. To say you have great customer service does not differentiate you in the marketplace. It's how you deliver upon that, what you do. So you and I are in total alignment on that, I'm amazed by those two points that you made because I see it all the time. Either A, there is not the clarity within the organization that they think of. And by the way, that would be a great starting point or a take home for the people watching. Is ask your team, why would somebody buy from us as opposed to the competition? What differentiates us in the marketplace place and just see how many responses that you get. I think to piggyback on what you were saying too, that a lot of times we ask the wrong questions. We may have a group discussion and say, okay, why do people buy from us? And they'll get the laundry list. Oh, we have great service and our people make the difference and all those things that we hear. But they don't ask the right question. As you were saying. And to me one of the right questions is why would someone buy from us as opposed to buying from the competition? Maybe we get a cheaper price. I don't think that that's the great long term strategy, but maybe that's the right answer. But they say, oh, we have great customer service. When you put that as opposed to in the question, then it forces you to say, well, is our service demonstratively better in a way that creates value for the customer than the competition? Is it so good that it's a reason to buy from us as opposed to the competitor? And what most organizations find when they go through that exercise is exactly what you say. You're so right, is that either there's not clarity about what it is or B it's not something that adds value to the customer. There was a study in Retail Marketing magazine not long ago that said depending upon the industry, there was a variance to some degree the small bandwidth of the figures. But between 60 and 70% of frontline people in retail can't tell you why you should buy from them as opposed to the competition. Well, if your own people don't know it, if you haven't sold your own people, how in the world do you expect them to go out and make an impression, an impact on the marketplace? You're so right. Internally we got to decide upon what that message is and then carry it to you Said there was a couple other points. I'm interested in what those.

Are. Well, so one, just to build on what you're saying is I find sometimes if you ask the question how do your competitors differentiate themselves from you? They can answer that. So it's sometimes just hard to look at ourselves to really get a good sense and even asking customers the problem is you ask customers. First of all, if you ask your customers, you're not asking your non customers. So that's fine to understand who you have today, but what have you done to understand the 99% of the market that you don't own or whatever that percentage is. But understanding what your customer's differentiation is sometimes an interesting exercise because it then gives you the clarity around what some other organizations have done and it helps you understand maybe what some of the thinking you need to do. The other point that I was going to make was around, well, I'll tell you a story. So I was doing this with a company, they're in the home assurance industry and basically these are the people who if you have a boiler, a water heater, air conditioner breakdown, they'll come and fix it. And so we started off asking the question, what is your differentiator? And every person in the room so we have perfect alignment. This is awesome. Everybody agreed that their pricing models, that they were able to create these unique pricing models that somehow and we didn't get into the details, but unique pricing models that were so different than their competition that that's why customers were interested in them. So I thought that's great, there's agreement on it. Then I asked an important follow up question. I said, how long after you introduce a new pricing model does your competition replicate it? And they said on average two weeks. Which basically means they were spending all their innovation dollars coming up with innovative pricing models that everyone else just became a fast follower in the long run. That's not a differentiator, that's doing the hard work for someone.

Else. Yeah.

Absolutely. So we step back and we really look at what are the things that they do better than anyone else that would have a fundamental impact on the service that gets provided because of their scale and a variety of other things. It's a big company. They had a unique relationship with the independent contractors who did the repairs. And what they decided to do is take all the money that they were spending, all these other things and they would funnel it into building a compelling and powerful relationship with those individuals. Given the scale of their organization, they could buy things on their behalf at big discounts. They put them through free education and other types of things. So what they do is they put the money into building this network then that their competition had no chance of ever being able to replicate. So the important point is your differentiator has to be difficult to replicate. Just like the other day I was giving a speech and somebody said, well, is putting a mint on the pillow in a hotel. A differentiator. Because some hotels do that. I said, how hard is that for someone else to do it? If it's not that hard, it's probably not a.

Differentiator. I love that you triggered a thought. I was doing a program in Europe, and they asked me to give a speech and do a couple consulting days afterwards. And the way I started the day was to say, okay, you built a very successful business here. You saw a need in the marketplace, and you filled it. So what I want you to think about this morning, let's start making a list. Here is, if someone was to enter the marketplace and compete against you to successfully do it, what would they do? And one of the guys said, oh, we've gotten so big, it's hard for us to make quick decisions. So they'd be nimble, right? So we write that, and they were able to come up with this incredible list of what an organization entering that space could do to successfully compete against them. Which, of course, sets up the big question, which is, so why don't you jump in and do this? If these are your areas where you're not meeting needs of customers that you see as points of vulnerability, it's almost a swot. Strength, weaknesses, opportunities, threats. It's almost a SWOT analysis. But I would encourage organizations to ask that question. Let's not focus on our current competitors. If somebody's going to jump in this space space and really hurt us, what are some of the ways that they would do that? How would we compete with us? Almost like we were talking offline about football with the super bowl approaching it, it's almost like doing the X's and O's. Okay, so trying to imagine what the other team is going to do, how are they going to defend us? How are they going to push the offense against us? And I think sports analogies are overused, but that's. That's one that might be appropriate, is to think about, if somebody was going to enter the marketplace and impact us, how would they do it? And then ask yourself, okay, if this is how we see that they can do that, why aren't we doing this? Why don't we jump in and do some of these things that would create more compelling differentiation for our.

Customers? Well, the analogy I use on this one is the tsa. So I know you and I are on planes a lot, and if you think about the way TSA has operated in the past is the way most companies operate. So somebody tries to light their sneakers on fire, what's the next thing we have to do at the airports, we have to take off our shoes. There are people trying to blow up a plane with liquids. What's the next thing we can't do is we can't bring in liquids onto the plane. That's for me. Let them know I'm busy right.

Now. Okay, sorry about.

That. I thought I had that.

Off. There we go. Hey, it's live. What can I.

Say? Hey, this is live and improvised. There we go. But if you think about it. So it's a good thing. I think actually somebody tried to blow up their underwear once, which I don't know what the ramifications were in terms of. That's why I think we get patted down now. So it's a very reactive model most organizations use is we wait for something to happen and we try to be a quick responder to. And I think what you're getting at is the opportunity is to be, I don't like the word proactive, but actually to predict what could happen next. And part of this, but this involves coming back to the expertise, being the enemy of innovation. I always say don't think outside the box, find a better box. But one of the things where I do think you need to think outside your organization is you should be asking. Because what we've done is we've gone through top executives and we've asked top executives and companies what are the three things that if you worked on, would have the biggest impact on your organization. Here's the problem. Even though these are most likely important questions, important challenges coming from important people inside the company, it's still based on their 30 years of experience doing one job. And they don't necessarily see demographic shifts, what's happening with generational issues, what's happening with geographical issues, what's happening with economic issues. Those are the things which our expertise will blind us to in terms of being able to be proactive. So maybe we look at our competition, but I always encourage people to have smart partnerships with universities and think tanks and others to help them be able to find their blind spots. Because if you don't uncover your blind spots, all the things we're talking about are irrelevant because you'll choose a differentiator that could be irrelevant soon. It could be a differentiator nobody cares about. It could be something that doesn't differentiate you. So how do we make it a sustainable, long term differentiator that sets us apart? To me, that's really the key with all of.

This. I love what you said there too. Because if you stop and think about it. By definition, a blind spot is something you can't see. Therefore, we need someone to, to help us in that process. And that's so critical. We tease a lot about what a consultant does or what a speaker does or what a strategist can help you do. But I do think that's one of the strengths. I did a blog post the other day about if you're a baby boomer hitting 55 or 60, find some 25 year old to mentor. If you're 25, find somebody to talk to. You bring up an important point is that not only does it need to have traction for our organization, but there are generational changes, there's technological changes. There are all these things going on. And I think sometimes, and I'm certainly guilty of it, is that we get trapped in our own perspective. And something that I might do might be perfect to, you know, other white guys my age. Right. But it might not be as, you know, crossing gender lines or ethnic lines or, you know, chronological differences, technological adaptability, all of those kinds of things. And so, man, I think what you said there is so absolutely important, is that we need to, you know, and that's. Isn't that part of why you and I are here today is that this exchange of ideas is part of where this innovation, where these points of creativity come.

From? Yeah, you used the word consulted. I actually spent 15 years with Accenture. I was leading a 20,000 person practice there. There's a lot of jokes about consultants. Like you said, hey, they'll borrow your watch, tell you the time and keep you your watch. I think that's the one that I always remembered. But actually, I think, and this is what clients always tell me, that the big value of bringing someone in is that they get to see what they can't see. It's sort of the old, you don't know what you don't know. And we need somebody with an outside perspective so we can read books and watch live webcasts like this. These are all interesting. These will start to increase our peripheral vision of the things that we can see that we may not have seen before. And sometimes it requires someone to look at it with fresh eyes who've seen it from different perspectives in order to provide new viewpoints. So it really. There's a lot we can do internally, but that expertise being the enemy of innovation at some point may potentially get in the way of our ability to deliver this full.

Scale. Oh, it's so true. I was talking about the four cornerstones of distinction. The third and fourth are communication and customer experience focus. Even if we have that idea to filter that and communicate that and connect that throughout the organization so that we're able to transmit that to the customer is so critically important. You mentioned corporate culture earlier, and it's just fascinating to me how everybody says, well, we got to communicate more effectively. But if there's not that unity internally, how in the world is the customer ever going to pick up that message if we don't know where we're innovating? And that's what I love what you said at the onset of the program in terms of it shouldn't be everybody out there innovating. There has to be clarity of purpose, a unanimous feeling about, this is where we're going, this is what we're doing. Because you can't differentiate what you can't define. If we in the organization can't define exactly this is what makes us different, or this is what we're going to do to make us different, if we can't define that internally, then we can't differentiate it externally. I see a lot of organizations that just are missing the boat when it comes to that. And the proof of it is those times that you and I go in and say, okay, what separates you, what differentiates you, what makes you distinctive? And internally, they can't agree. It's a critical, critical.

Problem. And I want to build on something that you said earlier, is that it's not just who you are, but I believe that in many cases it's who you are not that's more important. I think the killer of innovation is not the, yeah, but okay, that's stopping things from happening. I think the killer of innovation is the, wow, this is a great idea. And then people get so enamored and attached to things that they start trying to do everything. Knowing what to kill, knowing what not to do, knowing who you're not going to be gives you that focus. And at the end of the day, you said that innovation is everyone's responsibility. So I do believe that. But you don't want everyone innovating everywhere. And earlier you talked about apps. Everybody wanted to do an app. And then you said, well, maybe it's a different question. I would even say, and here's one of the things which I always say is, okay, is what we're creating core or differentiating it doesn't mean we don't do it. Most apps, in my opinion, if you're a hotel and it allows you to check in, or if it's an airline and it allows you to look. Every airline is going to do, every hotel chain is going to do this. It's the table stakes. So then the question you have to ask yourself is, do we need to do it or do we get someone else to do it? So for example, in the auto insurance industry, basically what they've decided is handling the claims process. The technology behind it wasn't going to be a differentiator for anyone. So there's one company that basically provides the technology infrastructure for like 90%, the auto insurance companies. So if it's core, find somebody else where their differentiator and have them do that work so that you can focus on what truly sets you apart. Now I can't believe I just looked at the clock. I can't believe if my math is correct, we've gone for 60 minutes. Yeah, I thought maybe we were only at halftime, but no, we're actually, we're past the two minute warning here. So what we're going to do now is we're going to bring Thomas on the line and I believe he's been capturing some of the questions that people have had and he's going to ask those to us. And we have about 15 minutes to do whatever we can to try to answer those. And I think as Thomas said, whatever we can't answer here. Scott and I will try to address offline through email.

Thomas. Thanks, Steve. Hi again everyone, this is Thomas. And before we begin the Q and A, we wanted to thank you for joining us today and to let you know again how much we enjoy this opportunity to share some of the insights and experiences with you. And we hope you're able to put all of it to good use. Unfortunately, sometimes putting new strategies and steps into practice can be very difficult. And learning new concepts in just 60 minutes can itself be a challenge. So we wanted to be sure we offered you a very simple way to let us know if you'd like to continue the conversation and perhaps even discuss bringing Steven and Scott or even both of them to your organization for an event, as a speaker or as an advisor to your team. If you'd like to continue that conversation, just click the orange let's talk button that you should see on your screen below. Steven and Scott right now. They will take you to a very simple form on Steven's website. It only takes a few seconds to fill out and then we'll be able to schedule a time that's convenient for you to connect with Stephen, Steven, Scott, or even both of them. And we look forward to having that opportunity. So now let's turn our attention to the Q and A piece. So, Stephen and Scott, here's the first question and this one is for Steven. This one comes from Wendy and she says, steven, I found a lot of value in your Harvard Business Review article and your USAA example was excellent. So my question is, what are some of the biggest mistakes or decisions that you see companies making that constrain their innovation.

Roi? Well, thanks. And I think we've covered a lot of things today that roi. And I guess the main thing as it deals with innovation is most companies dissipate their innovation energy. So they're not focused, they're all over the map. Coming back to one of the words that Scott used is that clarity. If you don't have that clarity around what is your differentiator and from your differentiator, cascade that down into the most important challenges. Don't work on everything, but work on the things that are going to have the greatest impact. One of the things you're going to find is that you have an incredible increase in roi. For example, in a Forbes article that I wrote, I talk about how you can get a 10 times improved improvement in your innovation ROI by asking the right question, the right way to the right people. The reason why this happens is because you get people laser focused. But also equally important, before you make any investments in anything at all, you get everybody aligned behind what we need to work on. And then we get the owners, the sponsors, the resources, the funding, the evaluation criteria, and the evaluators so that instead of trying to find a home for your good ideas, we already have everything lined up so that when we get the best solution, we can accelerate the implementation. So this front loading of all this thinking actually will give you that laser focus that gives you a much higher roi and it builds in everything that Scott and I talked about this.

Afternoon. Excellent. Okay, thanks, Steven. I appreciate that. So this next question is for Scott. It's from, it's from Amy. She starts off by saying great dominoes in Southwest example, talking about best practices. So her question is what should a company do the step by step to make sure that we figure out who we are and who we're not and how to get the leadership and everyone else on the same.

Page. Well, hopefully it begins with leadership. The leadership is the one that's initiating the step by step process. The techniques that Steven and I talked about today are so much easier, perhaps even totally dependent upon it happening at the top and then filtering its way throughout the organization. However, if you're working in an Organization that that isn't providing ways for you to become distinctive, for you to innovate. You have to take the personal responsibility to make that happen, at least for your own career and for your own sphere of influence. And so one of the ways I think that organizations get clear, a technique that I talk about is called high concept. It's a Hollywood term. It's the clarity that a movie brings to the marketplace. If I say bomb on a bus, you think of the movie speed. If I say shark attacks, you think of. You think of Jaws, Breaking Bad, the TV show that just has been recently concluded and is winning all types of awards. Now. It began with Vince Gilligan, the creator, going to amc, the cable channel with a little note card and it says, Mr. Chips becomes Scarface. So finding ways that you're so absolutely clear about what you are that you can say it in a six second way, you ask, Is it number one, are you using power words? FedEx could have said, we'll get it to your place by 10:30. Instead they said absolutely, positively overnight. Is it brutally brief? There are studies that say different times, but it's somewhere between six, seven and eight seconds that you have to grab someone's attention. So are you within that framework in terms of can you express what makes you, what your organization is about? Can you express that clarity in a phrase of about six seconds? Most important, is it congruent? In other words, is what you say you are, what customers would say that you are. When FedEx says absolutely, positively overnight, it's because they get it there absolutely, positively, overnight. When Domino's used to say, your pizza in 30 minutes, it's because you did get your pizza quickly. Sometimes those phrases are just used internally. Southwest focuses on cheap, safe and fun. Now, if I said I flew an airline that's cheap, safe and fun, you would probably think Southwest. Your initial response probably would not be US Airways, for example. You would be thinking of Southwest. The concept has to work internally and externally, but that is a process. I think the other part is too tough to change your way of thinking. I've just got to tell you, I apologize that what sounded like my phone went off, but it wasn't my phone. I got the new Samsung watch and Steven, it never occurred to me again, turn your phone off. We're now the time. You got to turn your watch off too, if you have one of these. That's part of it. We not only have to be clear about what we are, but we also have to again find a different box. It wasn't that I needed to think outside the box. I needed to build a better box, turn everything. Things are hitting us now from a technological standpoint, from a generational standpoint that are different than what they've ever been. And if we're not clear, and if we're not, to use Steven's phenomenal term, building a better box, then we're in trouble in today's hyper competitive.

Marketplace. Excellent. Okay, thanks very much, Scott, for that. And Steve, the next question that we have is from Mitch and he would like to know if there are other examples that you could share, like the great USAA example where companies have used innovation to affect.

Retention, retention of employees or retention of customers. I assume it's retention of.

Customers.

Yeah. He doesn't say here. My assumption would be retention of customers as.

Well. Well, I think there's a number of companies that do this particularly well. I'll give you. I'm going to talk about a company that's really controversial. I used to talk about them all the time. Coke Industries. It's not Coca Cola, it's Coke K O C H out of Wichita, Kansas. For people who don't know Koch Industries, they are a pretty diverse company with petrochemicals, asphalt, paper, pulp, oil, gas. They have like Lycra, Stainmaster carpets, Brawny paper towels, Dixie cups. I mean they've got all that stuff. So they're first of all in the least sexy industries you could possibly imagine. But they are $100 billion company in revenue. So they're a pretty large company. If they were a publicly traded company, they'd be probably in the top 20 of all companies in the United States. And the thing which they do, which I think is so fascinating, is they've been able to grow the company for 50 years at 5,0 years, 8 to 10 times greater than the average S&P 500 company. They are the fastest growing company, as far as I can tell, of any company in the world. So when you look at innovation and what innovation is, to me this is the key. Now how do we do it? This is an example which will contradict slightly what I talked about earlier, Scott. But this is truly an example of where their culture is the reason, because they use this concept of free markets. And their belief is that anybody who is in a position of power should be given money to spend any way they want. And they will do something called experimental discovery. And they will try things with the assumption that they don't know what the market actually wants. So they will do these experiments and these experiments. If they're successful will scale and grow over time. And it becomes sort of a Darwinian model that these successful experiments will start to cannibalize things that are less successful. And their growth has been attributed to this free market, what they call market based management philosophy. And the reason why I love this is differentiation can take all different forms. And here I would say their differentiation is pure localization. They push decision making down to the lowest level of the organization so that they understand everybody's needs at the local level and they can deliver those needs consistently on a regular basis by being nimble. So it's a slightly different answer than maybe we talked about earlier, Scott. But look, you can't argue with numbers. They've grown faster than any other company. They're huge. I just think they're an amazing model for what is possible. If a company truly wants to embrace a culture of innovation that's embedded at every.

Level. Could I piggyback just quickly on that too? And that's to say that I think what Steven said just there about what retains customers philosophically also retains employees. If you look at the list that I believe it's Fortune magazine comes out with every year of the best companies to work for, those are also very successful, very profitable organizations. We call this a clue. If you have the type of organization that inspires your people, then they take that culture to your customers. I don't think it's a surprise that Nordstrom has the reputation as the best place to work for of all department stores and they also have the best customer service. Southwest has the happiest employees and they also have the most loyal customers in that particular industry. I think there's a great correlation with what Steven said about how you do it for your customers and also how you do it internally. And I don't think that you could pull the two apart philosophically. What gains customer retention in the long run is also going to gain you employee retention as.

Well. That's excellent. Gentlemen, I think we have time for one more question. This one is for Scott from Greg and Scott, you mentioned a three step pyramid in the beginning of the webcast today. You identified sameness as level number one. But what were the other two? I apologize if I missed those.

Two. Oh, great. Thanks for asking. Level one is sameness. Where. Well, let me use the laptop computer example. It's, it's what I use in the book. If I walk into, let's say Best Buy and I'm going to buy a laptop, there's going to be some there that are all this that I Consider to be at that level. A couple examples would be Acer and Asus. Why would you buy an Acer over an Asus or the other? I don't know. I mean, I can't tell you what would make a Fujitsu superior or inferior to a Gateway. To me they're all the same. So I look at there at price or I might look at the size of hard drive, but it's commodity type of purchase decision. But if I take it a notch up, Dell because it's made to order, or Sony because of the design and the violine of cameras and the HP with the printers and peripherals and all of that, those organizations have moved up that pyramid. When I originally did the study, and I had the list in the first edition of the book, by the way, Samsung was in that group at sameness. Now there's an organization that has made a conscious decision to innovate, to move up that pyramid. And now you would find them advancing up. So you'd have that middle group of differentiation and the highest point of the pyramid would be true distinction, where price becomes almost no issue at all. Obviously in that argument, Apple would be the example. Interestingly enough, I had some people say, well Scott, Apple is just depending on whether the iPad is included or not, 7 to 10% of the marketplace. But Apple has a 92% market share of laptops sold $1,000 and above. So price becomes less of an issue when you become a truly distinctive organization. So it's finding ways to, to move yourself up the pyramid. And there again, I mean, as Steven so greatly puts it, they innovate where they differentiate. And it has created, I mean for every organization, the profitability becomes the issue. And so finding ways to be so compelling that you create these raving fans who will spend a little bit extra to do business with you, who will refer you more, who won't leave, your cost of acquisition goes down. There's so many ways that this benefits every organization, Stephen. I hope that supports what you've been saying as well, because I find those points that you make to be incredibly.

Compelling. Well, the more we talk, the more I realize how aligned we.

Are. Me.

Too. The first question that was asked of me was about roi and I think just sort of to circle back. What I think you just hit on is that if you want to be able to charge a premium, if you want to keep your customers, get new customers, actually create a pull more like a vacuum, that's the easiest way to create high levels of ROI in everything you're doing. And Instead of dissipating your energies on a lot of things you could do that might be interesting, that deal with somebody's fancier whim, maybe the best thing to do is to really figure out how do you differentiate? How do you distinguish yourself in the market and then use that to be able to charge the premiums that we talked about. So I think that's a perfect way to wrap up this session. Scott, I can't thank you enough for your time. I love the conversation and I think we should do this again. But next time I want to be in the same room with you. I love technology. What I want to do is face to face. We'll have another session. We'll dig even deeper on it. I hope we can do that sometime in the very near.

Future. I would love to do that. And, Stephen, thank you so much for the invitation. I really appreciate it. I'm a big fan of. Well, your article on Harvard Business Review is a perfect example of it. You're such a compelling thinker and writer and speaker. And so thank you for the privilege of joining you. I second the motion. Let's get together and do this in person sometime.

Soon. Great. And thank you, everyone who's been watching. We're hoping that this is the start of 2014 for you, stepped it off on a great foot and helps you build that irrefutable differentiation, that irrefutable distinction that's going to make your organization one of the most successful organizations and maybe one of the greatest places to work, as you pointed out, Scott. So thanks, everyone. We hope to see you soon. Bye.