In a positioning map there aren’t many absolute requirements. A requirement that really must be kept however is that each axis represents a single dimension. This is the importance of being one-dimensional. Multiple Terms On One Axis Creates A Mess If you try to have more than one dimension on each axis it isn’t so much…
Beating Rivals Should Not Be Your Goal
Is the goal of business to do the best you can or to beat others? A surprising number of people seem to think business is about beating others. The technical term is competitor orientation — when your ultimate objective is to beat your competitors. The point is that pretty much whatever your view of business,…
Boring Positioning Maps
I often discuss mistaken thinking. This post is a little different. I’m discussing something worse than being wrong and that is being boring. Specifically, producing boring positioning maps Not Wrong, Just A Boring Positioning Map A positioning map illustrates marketing strategies. Here I discuss the axes of which there are two generic types. Where there…
Evolution And Jack Welch
While it is rarely explicitly acknowledged evolutionary thinking is central to business theory. People often believe selection pressures change populations competing in markets. (How exactly this happens is often a little vague). What is the connection between evolution and Jack Welch? Evolutionary Thinking In Economics Armen Alchian was an early proponent of evolutionary thinking in…
Rational Voters?
Whenever I hear someone say “rational” I worry. Everyone means a different thing. This is a problem as obviously you can’t discuss rationality without knowing what it is. Bryan Caplan uses his view of rationality to criticize democracy in The Myth of the Rational Voter (Caplan 2007). The book left me with mixed feelings. I love…
Paranoia Doesn’t Make Sense
The most infuriating articles are written by otherwise impressive scholars. One such article is Roderick Kramer’s When Paranoia Makes Sense. Written in the aftermath of the September 11th terrorist attacks and the Enron debacle it may have resonated at the time. Still, it is irredeemably flawed and socially malignant. Kramer should have known better. Paranoia Doesn’t Make…
Marketers Prefer Contribution
A couple of years ago teaching introductory marketing I told my students they must have calculations in the final exam. They listened and gave me numbers. My students were mostly aim for investment banking. They thought finance had the “best” numbers and so used these. They gave me some marvellous numbers, e.g., EBITDA and NOPAT….
Friedman’s Ethical Joker
In 1970 Milton Friedman produced perhaps the most influential popular article by an economist, The Social Responsibility of Business is to Increase Its Profits. Admittedly 43 years late is not the snappiest comeback. (I wrote this in 2013). Still Friedman’s argument has flaws. Many have already tackled major weaknesses. Here I will concentrate on a…
How Bad Metrics Help
In this post, I will examine how bad metrics help. Something doesn’t have to be perfect to be useful. Often the act of creating a metric, even a bad metric, creates debate/conversations which highlight what we do, or do not, know. Two Scenarios Consider the following scenarios: A) The plan was unveiled in the meeting….
Does Acquisition Cost Reduce CLV? No
Marketing suffers from serious definitional problems which undermine the communication function of metrics. For example, Does Acquisition Cost Reduce CLV? I therefore recommend a step forward; lets all exclude acquisition costs from customer lifetime value (CLV) calculations. CLV Is The Net Present Value Of A Customer Relationship Customer lifetime value is the net present value…
