I have been reading the Purple Cow, by Seth Godin. The premise of the book is really quite simple.
If you are driving out into the country you inevitably see lots of cows – the black and white variety. While at first you may think the scenery is amazing, eventually it gets boring.
But what if you saw a purple cow?
Using this as an analogy he looks at how successful businesses need to create purple cows – remarkable products, services and ideas.
As I was reading today, a comment he made resonated with me.
Bootstrapping entrepreneurs often upend existing industries because the dominant players in an industry are the last place you will find empowered mavericks. The market leading companies may owe their dominance to the Purple Cow they marketed years and years ago, but today, they are all about compromising themselves to continued profitability. The seeds of their destruction lie in their dependence on being in the middle. (Page 93)
For Godin, being in the middle essentially is when a company tries to satisfy everyone, and really not push the edges of their product or service anymore. In other words, its were the marketing budgets are bigger than the product development budgets and products are average, rather than remarkable.
The reason this resonated with me so much (other than myself being a bootstrapping entrepreneur) is that it echoed a key idea which is present in Richard Branson’s autobiography, ‘Loosing My Virginity’. Branson has an amazing track record of entering arguably saturated markets characterized by large companies with strong brand awareness and market share, and capturing the market and turning it on its head!
Branson’s success has ultimately arisen due to his ability to keep his companies small (in terms of management), and consequently, innovate quickly, and often, creating Purple Cows, which have allowed him to capture the market.
Much of Branson’s Purple Cow factor comes down to customer service. Branson’s story of how he decided to launch Virgin Atlantic illustrates this – he attempted to book a flight with British Atlantic (BA), experienced horrible customer service, and realized, ‘Hey, other people must have the same problem, why don’t we do something about this?’.
What is evident from Branson’s autobiography is a belief that you can enter any industry, and within 2 years, capture a large share of the market purely by providing better customer service. For Virgin – customer service is their Purple Cow.
Take health and fitness gyms for example – the dominant player in Australia is arguably Fitness First. One of they things that has always irritated me has been there customer service. I mean there gyms are great – large, fairly clean, lots of machines etc. But customer service? Lets face it, we all probably know of people who have had crappy experiences. I know a number of people who have been over charged or who have canceled within the cooling off period and still been charged. The biggest pain though? The lack of flexibility. Want a month to month rolling contract? What about pausing your membership for month or two? In the past these have not been possible, and now, you still have to pay. What often ends up happening is most gym users pay for a whole lot of gym time that they never use!
Virgin runs their own gyms – in fact, last time I checked they owned the largest health and fitness provider in South Africa, and the UK. They also have opened two flag ship health clubs in Sydney. Guess what their key difference was compared to their competitors?
Customer service – specifically flexibility. Rolling month to month contracts (so you could cancel whenever you wanted!) and flexibility in holding memberships were part of their overall customer service efforts. Sound like a gym you would want to join?
Whenever I see a business who offers poor customer service – the first thing I think is that that particular business is at risk of losing market share.
A company who also epitomizes the Purple Cow through customer service is Zappos, whose motto is ‘Powered By Service’. I recently finished reading Delivering Happiness, a book written by Zappos CEO Tony Hsieh. Tony really outlines in a fair bit of detail how Zappos has become a $1 billion + online shoe retailer (and now more), purely by focusing on amazing (and I mean amazing) customer service. Customer service has been their purple cow. Rather than spend money on advertising, they simply pumped their whole marketing budget into developing crazily awesome customer care. How did they grow to become such a large company? Their customers (who were extremely happy), would not stop talking about them!
So, to conclude the Purple Cow is a good read. It is short, filled with lots of examples and case studies. It essentially only has one key message, and that is – develop remarkable products, services and ideas, and people will talk!
After looking at Zappos, and Virgin, I tend to agree.