A supply chain is made up of interconnected parts of a whole, all of which add up to finished products bought by customers. Take automobiles, for example. Before a consumer buys a car, iron ore is extracted from the earth. The ore is transported to a plant, where it’s turned into steel, which is made into the chassis of the automobile. To make the car, various components—from engines to batteries, electrical components, rubber tires, a metal body, and paint—are assembled. Once the car is made, it’s sold in a retail setting to the end consumer.

Understanding Supply Chains

<ul><li>producers, which make or grow the raw materials for goods</li><li>vendors, which buy and sell materials</li><li>manufacturers, which make materials into goods</li><li>transporters, or logistics providers, which move those goods around the world</li><li>supply chain managers, which ensure that operations run smoothly in everything from planning to sourcing raw materials, manufacturing, delivery, and returns</li><li>retailers, which sell goods either online or in physical stores</li><li>consumers, who buy and use those goods and services</li></ul>

The Stakeholders

A supply chain includes all the raw materials and parts that are made into a product and distributed up the chain for manufacture and sale. In contrast, a <a href="https://www.mckinsey.com/featured-insights/innovation-and-growth/globalization-in-transition-the-future-of-trade-and-value-chains">value chain</a> encompasses all the individual steps that are taken to create a marketable product. That includes not only physical components but also various value-adding activities that might be classified as part of the “knowledge economy”—things such as innovation, design, marketing, and sales—and that lead to the development of a product ready for customers.

Difference Between Value Chains and Supply Chains

When any link in a <a href="https://www.mckinsey.com/business-functions/operations/our-insights/diagnosing-the-pain-in-your-supply-chain">supply chain isn’t working optimally</a>, you might say the supply chain has been disrupted. Different issues can emerge. For example, an increase in inbound material costs, because one material costs more this year than it did last year, can have major implications on a company’s cost structure. Or <a href="https://www.mckinsey.com/business-functions/operations/our-insights/navigating-the-labor-mismatch-in-us-logistics-and-supply-chains">labour market mismatches can cause operational concerns</a>—for instance, if transport companies can’t find enough people who want to drive trucks to deliver goods.

Supply Chain Disruption

<ul><li>planning and supplier networks</li><li>transportation and logistics systems</li><li>financial resiliency</li><li>product complexity</li><li>organizational maturity</li></ul>Supply chain disruptions lasting one month or longer occur every 3.7 years, on average. And these disruptions can have a steep price: they cost the average organization 45 percent of a year’s profits over the course of a decade.

Five Areas Where Supply Chain Vulnerabilities Show Up

Although <a href="https://www.mckinsey.com/business-functions/operations/our-insights/how-covid-19-is-reshaping-supply-chains">the COVID-19 pandemic</a> has delivered the biggest supply chain or value chain shock in recent memory, other examples abound. The Russian invasion of Ukraine has led to the worst humanitarian crisis in Europe since World War II, as well as <a href="https://www.mckinsey.com/business-functions/operations/our-insights/supply-chains-to-build-resilience-manage-proactively">supply chain disruptions in critical sectors</a>, including agriculture, automotive, energy, and food. Changes in the environment and the global economy have increased the frequency and magnitude of these shocks. For instance, the 2011 earthquake and tsunami in Japan shut down electronics factories.

Supply Chain Risks

Supply chain shocks are classified into four different types:Unanticipated catastrophes. These are historically remarkable events that can’t be anticipated and lead to trillions of dollars in losses.  Foreseeable catastrophes. Shocks in this category are of a similar magnitude to an unanticipated catastrophe but differ in that larger patterns and probabilities can guide general preparedness.  Unanticipated disruptions. These are serious and costly events but are on a smaller scale than catastrophes.  Foreseeable disruptions. Some disruptions can be spotted in advance of their arrival.

Classification Of Supply Chain Shocks

Organizations often focus on managing the shocks that they see most often. The COVID-19 pandemic is a reminder that while outliers are rare, organizations still need to consider such possibilities when making decisions and strategic moves. For most organizations, that will mean expanding supply chain executives’ long-standing focus on cost (and capital usage), service, and quality to include <a href="https://www.mckinsey.com/business-functions/operations/our-insights/future-proofing-the-supply-chain">three new priorities: resilience, agility, and sustainability</a>.

Resilience, Agility, and Sustainability

<a href="https://www.mckinsey.com/business-functions/operations/our-insights/diagnosing-the-pain-in-your-supply-chain">Inflation can play a role</a> in supply chain challenges. When inflation occurs, costs for input materials (<a href="https://www.mckinsey.com/business-functions/operations/our-insights/outsprinting-the-energy-crisis">such as energy</a>) can rise substantially, having negative effects on companies’ profits and losses. One way to adjust is to increase prices (fairly) for consumers. Organizations can make more informed decisions by using an <a href="https://www.mckinsey.com/business-functions/operations/our-insights/responding-to-inflation-and-volatility-time-for-procurement-to-lead">exposure matrix</a> to assess which categories of their products are exposed to market forces and whether the market is inflating or deflating.

Inflation And Supply Chains

<a href="https://www.mckinsey.com/featured-insights/business-resilience">Resilience</a> refers to the ability to withstand, adapt, and thrive in the face of internal and external shocks—both known and unknown. More specifically, <a href="https://www.mckinsey.com/business-functions/risk-and-resilience/our-insights/the-resilience-imperative-succeeding-in-uncertain-times">operational resilience</a>, which encompasses supply chains, is about businesses maintaining robust production capacity that can accommodate shifts in demand and remain stable amid disruption, without letting quality slide.

Supply Chain Resilience

Firefighting. This refers to short-term, day-to-day actions that can help identify previously overlooked supply chain gaps. These tactics don’t build resilience, however, so they should be used only in concert with more complex, long-term reforms.Integrating and streamlining operations. Here, three actions can be critical to building resilient supply chains:<ul><li>creating a nerve centre to consolidate organizational responses</li><li>simulating and planning for extreme supply and demand disruptions</li><li>reevaluating just-in-time inventory strategies</li></ul>

Handling Long Term Uncertainty

Quick responses are easier to accomplish, but if long-term resilience is the goal, the following techniques can help:<ul><li>constructing a digital twin of the most critical parts of the supply chain, allowing for simulations and test cases</li><li>creating and testing “what if” scenarios</li><li>increasing data sharing with suppliers</li><li>considering ring-fencing a small part of the supply chain team</li></ul>

Achieving Structural Resilience

Supply chain management (and operations, more broadly) is now a CEO-level concern. Some of the strategic operational questions that CEOs have on their agenda include the following:Can we meet customer demand both today and tomorrow?Should we boost capacity to prepare for prolonged, rapid growth or reduce it to prepare for a slowdown?Where will we find workers who are skilled and digitally savvy?How do we decarbonize, minimize regulatory risk, and stay in business?

The Working Of Great Supply Chain Orgs

Incremental efforts aren’t enough to capture the full potential, and drilling down into the right supply chain structure and physical footprints is a critical starting point. Midsize supplier plants with 1,000 to 1,500 employees were nearly twice as likely as bigger or smaller counterparts to score in the top quartile on productivity. So having production divided among several plants rather than in a single mega factory could help a company move closer to customers and reduce location risks.

The Right Structure

Few established companies have fully digitized their end-to-end operations. But <a href="https://www.mckinsey.com/business-functions/operations/our-insights/the-ceo-architect-of-the-new-operations-agenda">digitization can be a feasible solution to operational challenges</a> seen across many companies and industries. <a href="https://www.mckinsey.com/featured-insights/mckinsey-explainers/what-are-industry-4-0-the-fourth-industrial-revolution-and-4ir">Industry 4.0</a>, or the Fourth Industrial Revolution (4IR), describes the impact that increased connectivity, automation, and more have had on technology, industry, and society.  Industry 4.0 has helped them sustain their operations during the COVID-19 crisis; over half said their digital transformations have been crucial to their pandemic responses.

Digital Supply Chains

Digitization, including advanced analytics, automation, and machine learning, can help operations become more productive, flexible, and geared for speed. Such approaches have yielded real results for some leading organizations—for example, reducing inventory and cost of goods sold by 30 percent, lowering the cost of quality by 50 percent, and improving cash and productivity by 30 percent. Surveys also suggest that digitization and an embrace of Industry 4.0 technologies can <a href="https://www.mckinsey.com/business-functions/operations/our-insights/lighthouses-unlock-sustainability-through-4ir-technologies">boost eco-efficiency</a> in supply chains.

Digitization For Efficiency

While some leading organizations have already realized value from digitization, others are lagging behind. Modernizing supply chain IT—for instance, to improve demand forecasting and planning systems—can have a powerful effect. For organizations looking to step up on IT for supply chain planning, three steps can help:<ul><li>Redesign processes.</li><li>Select vendors.</li><li>Create an implementation road map.</li></ul>Cumulatively, these changes can have a significant impact, especially when they support a successful rollout of integrated business planning (IBP).

Moving Towards Integrated Business Planning

Discover the world of business and economics.

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Economics

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Marketing & Sales

business

Business

product

Product & Design

What is supply chain?

Whether or not you should pursue a catalogue strategy is a question that deserves significant thought. As digital marketing becomes more complex, it may make a lot of sense to send out correctly designed catalogues to the right customers. For e-commerce retailers without physical stores, catalogues can effectively mimic stores’ sensory experiences to enhance customer affinity. Multichannel retailers can add an effective catalogue marketing channel to their store and e-commerce channel strategies.

A Paper Catalogue

The costs of digital advertising are skyrocketing. By some metrics, prices on major platforms such as Meta, Google, and TikTok <a href="https://www.thedrum.com/opinion/2022/04/28/the-price-digital-ads-has-skyrocketed-here-s-how-counteract-it">grew by anywhere from 61–184% year-over-year</a> <a href="https://www.businessinsider.com/digital-ad-prices-are-skyrocketing-in-2022-2">in 2021</a>. At the same time, returns are plummeting; recent changes in privacy policies, such as those by Apple, have made it more difficult to target ads to consumers, who are increasingly likely to tune out the advertising that they see anyways. All of these trends are making digital advertising increasingly unprofitable and ineffective, forcing companies to <a href="https://www.forbes.com/sites/walterloeb/2021/08/04/rising-costs-of-digital-advertising-will-force-spending-shifts/?sh=3f797e415a7c">rethink their marketing strategy and spending</a>.

Digital Marketing Isn't As Lucrative As Before

The audience for catalogues is growing, even as the pandemic subsides. The emerging remote/hybrid work culture and consumers’ increased screen time will make analogue experiences such as catalogues increasingly appealing and effective. Just photos Vs Photos with text: While both designs are effective compared to not receiving the catalogues, designs with photos and textual narratives are 40% more effective in sales and customer engagement than designs with only photos and product names.

The Rise Of Paper Catalogues

Catalogues featuring hedonic products have 120% higher marketing ROI than utilitarian products, consistent with psychological theories. Higher-priced products also achieved 50% higher marketing ROI compared to lower-priced products.The finding that the catalogue’s effectiveness is product-type dependent can help explain why while many hedonic and experiential brands such as Birchbox and Lego are implementing catalogue strategies, many traditional utilitarian brands such as Ikea have discontinued them.

The Lure Of Hedonic Products

As retailers and brands increasingly compete beyond mere performance attributes to win the hearts and minds of consumers, they ought to think carefully about the aesthetic design aspects of their marketing programs. High-quality physical catalogues with stunning imagery combined with compelling narratives can create the sensory awe that would be hard to replicate on a digital screen. These sensory experiences can then lead to long-lasting impressions and stronger relationships with customers, and translate competitive advantage for the company.

The Bottom Line

How Paper Catalogs Remain Relevant in a Digital Age

The road is full of failed transformation programs: Leaders define objectives, design a project plan, agree on KPIs, and recruit the right people. Yet the failure rate in transformations is far too high and one that organisations can't afford. For a transformation to be successful, leaders should approach it in ways designed to mitigate emotional harm to employees.

Leading a successful organisational transformation

Research shows that leaders and workers start transformations excited and optimistic. But as the transformations get rolling, they all show reduced positive emotions and increased negative emotions. All transformations are difficult, and confidence is bound to dip. Yet this is key to the transformation's success. The heightened stress raises performance, and leaders who learn from their emotions use those lessons in their transformation. This maintains high performance.

What makes transformations successful 

Leaders must create psychological safety and mechanisms for all voices to be heard. Without psychological safety and support, workers feel anxious and overworked. Moreover, workers lose faith in transformation when there's no compelling vision, visible progress, or practical and emotional support from leaders. When leaders themselves lose faith in the transformation, they may become distant, look to reduce damage to their own brands and jump to different activities.

What makes transformations unsuccessful

Failed transformation can lead to employees suffering emotional damage, losing confidence in leaders, and becoming sceptical of further attempts at transformation.Ways to set transformation up for success by prioritising their employees' emotions.<ol><li>Address the unsustainable status quo.</li><li>Detach from the status quo.</li><li>Develop a purposeful vision.</li><li>Lead emotional transformation.</li><li> Include both the rational and emotional. </li><li>Align KPIs, funding, resources, and people.</li><li>Make transformation the new normal.</li></ol>

Seven steps for a successful transformation

Any transformation begins by recognising that the status quo is unsustainable. It means working on yourself first and starting a transformational emotional journey.  Understanding the unsustainability of the status quo means putting yourself as a leader in a separate place to see yourself, your company and from where you operate differently.

1. Address the unsustainable status quo

Embrace the unknown and adopt the humility required to challenge your mindsets and assumptions about your company, its current ways of working, the industry and what will result in success. <ul><li>Be open to learning.</li><li>Lean into the emotions of anxiety, fear, and excitement.</li><li>Understand the system you're in, how it's changing and what opportunities and risks are being created.</li><li>Expose yourself to new ideas that will inform and structure the future of your industry and company.</li></ul>

2. Detach from the status quo

Embracing the unknown and adopting humility helps you to create a vision because you can see more clearly what needs to change and why.  You can then imagine how you might create value differently at a functional, product and service, or even entire business model level.

3. Develop a purposeful vision

Transformation is both exciting and unsettling for employees. For example, they can't see how their skills will be relevant. Therefore, it is essential to address these emotions. Formal conversations will help them to work through their anxiety and fear of the unknown.Yet, listening skills are just as important:<ul><li>Encourage emotional awareness and expression through simple questions such as, “What are you feeling? Can you tell me more about that?”</li><li>Paraphrase what you think you’ve heard to facilitate emotional regulation.</li><li>Create workshops that enable active reflection on emotions.</li></ul>

4. Lead emotional transformation

When executives begin a transformation, they will reach for a project plan that focuses on a rational understanding of how long it will take to deliver key activities. These plans are often overly ambitious and miss the critical listening component, which causes the process to slow down.  Conduct one-on-one listening exercises as well as in small groups and workshops to help leaders and employees understand their own purpose and how they are part of the bigger purpose.

5. Include both the rational and emotional

Employees may find the reality of major shifts in KPIs, performance management, funding, and resources difficult. Their lack of belief in the transformation becomes real as they lose power, status and even their roles. Losing people is inevitable in a successful transformation, but research shows that making practical decisions sooner enables people to move from one emotional state to another.

6. Align KPIs, funding, resources, and people

The old model of predictability, stability and hierarchy was the norm in many organisations. However, stakeholders demand a more "organic" organisation where continual transformation is the norm. Enabling transformation requires giving employees the information and resources they need to develop and innovate in other directions.

7. Make transformation the new normal

It’s not news that organizational transformations are prone to failure. To understand the skills, mindsets, and capabilities behind successful transformations in today’s dynamic environment, EY and Oxford University formed a research collaboration to investigate what it takes to lead a successful transformation. One of the authors’ most important findings is that, in order for transformation to be successful, leaders must approach it in ways designed to mitigate emotional harm to — and drive emotional commitment from — employees. The workforce bears the brunt of failed transformations, and the emotional damage can be substantial as employees lose confidence in leaders and become skeptical of further attempts at transformation. Drawn from their research, the authors present seven ways for leaders to set their transformations up for success by prioritizing their employees’— and their own — emotions.

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Corporate Culture

communication

Communication

Organizational Transformation Is an Emotional Journey

Seeing paywalls is key for revenue on consumer apps. <ul><li>Most important metric is App Install → Paywall. Revenue moves (almost linearly) with this metric.</li><li>Second most important metric. Paywall views per free user. Around the 7th paywall view on average.</li></ul>Best setup to start with: Paywall BEFORE Onboarding + Paywall AFTER Onboarding + Paywall EVERY App Open. Best if the first paywall includes a screen recording. Show the user exactly what they are getting with a free trial.Send push notifications out daily. Each app open = paywall view.

Paywalls Views Matter

Run drip campaigns:<ol><li>Lower prices on day 0, day 3, day 7, day 14, day 30.</li><li>Send reminders via push but also SMS or email</li><li>Link to web checkout: You should have a URL like <a href="https://t.co/oDGocLt5G2">http://appname.com/checkout?app_user_id=100…</a> that deep links to your app after purchase.</li></ol>

Constantly lower price with drip campaigns

Sales can account for 20% of total revenue: <ul><li>Christmas</li><li>Black Friday</li><li>New Years</li><li>Memorial Day</li><li>Labor Day</li><li>Spring Sale</li><li>Fall Sale</li><li>Summer Sale</li><li>Father’s Day</li><li>Mother’s Day</li></ul>Offer a discount like 50% off.

Use Sales 

Price testing is useful but not as important as one may expect. First test weekly prices. Then monthly. Then annual. Analyze cohorts over time:<ul><li>For weekly, test $1.99, $2.99, $3.99, $4.99, $7.99, $9.99. Test 3 and 7 day trials. When you find a winner, go onto monthly.</li><li>For monthly, test $4.99, $7.99, $9.99, $12.49, $14.99, $19.99, $29.99, $49,99. Test 3 or 7 day trials. When you find a winner, go onto yearly.</li><li>For yearly, test $29.99, $39.99, $49.99, $59.99, $89.99, $119.99, $129.99, $149.99, $189.99. </li></ul>Alos test 3 and 7 day trials.

Test Pricing

Hide a cheaper priced plan in your subscription group. For ex, offer users $89.99/yr in app, but add a $59.99/yr product called Secret Discount.When users go to cancel, they'll see the discount. I've seen setups increase revenue by 10%.If the user cancels their trial, add a floating UI above your app’s homescreen showing them # of days till their trial expires. Link to a paywall with a discount.

Winback campaign with discounts

<ul><li>You must also be able to change questions very easily. Simplest setup is to show typeform surveys on app open. Add app user id as a hidden parameter. This lets you change questions over time.</li><li>Send two types of surveys out: trial cancel survey & product market fit (Asking how would user feel if the product went away). Use local notifications for trial cancel surveys.</li><li>For trial cancel survey, ask the following (1) why did you cancel? (Multiple choice) (2) how can we improve (free response). End with a discount via Stripe.</li></ul>

Dynamic User Surveys

<ul><li>The first rating request should be as fast as possible. Maybe even in the onboarding. Introduced with the text "How is it going so far?"</li><li>If the user completed a survey with a question "Why do you love the app?" use that text for the review. </li><li>After your first rating request, only ask for an in app rating after the use of a core feature.</li><li>Only ask if the app version is different from the last time you asked for a rating.</li></ul>

Get More Ratings

You must balance completion rates and paywall conversion rates. Higher completion rate = more paywall views. Longer onboarding = higher paywall conversion rates (due to sunk cost bias).<ul><li>Personal info like name, age, email etc. have the lowest completion rates. Offload as much as possible to after a paywall view.</li><li>Sort each step in descending completion rate. Lowest converting steps will have a higher chance of converting at the end due to Sunk Cost bias.</li><li>First paywall test should test your messaging. This will inform everything from feature development to later iterations. </li></ul>

Onboarding Tips

When your paywall is dismissed w/o paying, ask why in a free response survey.Use responses determine multiple choice Qs. Use a word cloud to analyse free responses.

Survey after paywall dismissal 

Being able to remotely update your paywall is essential. Use Firebase's Remote Config to alter pricing, text and images remotely. You can simulate a fully remotely-configurable paywall by using images as static UI elements.

Remotely Update Your Paywalls

Keyword at the beginning of your Title and Subtitle carry far more weight than those at the end. Frontload ing keywords is a popular hack. This is the time to care LESS about your brand and MORE about being practical.Use Apple Ads to find the best keywords for your description: <ol><li>Overpay for clicks if you need to. Don't worry about profitability</li><li>Send keyword attribution to your analytics tracking & see which have highest install to paid conversion & 30d retention rates.</li><li>Take the top result & change your app's title to “Keyword - App Name”. </li><li>Use the rest in your subtitle. Don’t worry about grammar.</li></ol>

ASO Keyword Payloading

Create in-app events via App Store Connect. Titles you use can rank organically in search results. Hint: If you choose a start date of around 1hr after you submit for review, your app review will be expidited.

AppStore In-App Events

<ul><li>Use native ad SDKs when you can. No need to use Appsflyer for Facebook ads.</li><li>With FB, stick to Automated App Ads (AAA). They let you upload 50 images or videos and 5 sets of text. They handle the rest (including audience). </li><li>Optimize for trial starts if you have enough events</li><li>Create two AAA campaigns to begin with. Tier 1 targeting only the US. Tier 2 targeting Canada, UK, Australia and Germany. Split spend 90% Tier 1 and 10% Tier 2 countries.</li></ul>

Ads Tech Setup

Hiring influencers (via TikTok mainly is essential). Use them to create content for ads, not for an ROI positive influencer campaign, that’s too hard to achieve on a small scale.<ul><li>Pay out influencers based on performance if you can. Again, this isn’t to make sure you’re ROI positive, it’s to make sure interests are aligned so their videos make for great ads.</li><li>Buy / negotiate the right to use your influencer’s videos in your ads. Don’t use them without asking! Use them in your AAA campaigns.</li></ul>

Influencers based campaigns

<ul><li>Target users with ad creatives, not with ad settings. Its always cheaper to cast a wider net with open targeting – videos & text will attract users who resonate with the problem your solving and the solution you are advertising.</li><li>Ask “who do you think would benefit most from using your app?” These responses are your personas. Make ad creatives for each of your personas.</li></ul>

User Creatives from Users

Don’t hide old feature releases from new users. They aren’t as curious as you think. Take screen recordings of new features as you release them. Send email + push notification tips on how to use them. Send every 48 hrs. Start from the beginning for each new user

Market Old Features As New

Practical ideas on monetising mobile apps

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Startups

Monetisation Secrets from Jake Mor

In recent years, companies like T-Mobile have achieved something once thought to be legally impossible: They’ve successfully trademarked individual colours. When a colour becomes synonymous with a brand, a company can claim a certain form of "ownership" over it.

Trademarking individual colours

Under the umbrella of intellectual property law, the 3 three most common applications are:<ol><li>The trademark.</li><li>The copyright, and</li><li>The patent.</li></ol> Corporations use the trademark to protect anything integral to their brands, such as any word, name, symbol, or device that identify and distinguishes a company's good or service from its competitors.

The benefits of a trademark

Companies successfully trademarked combinations of colours, but the US Patent and Trademark Office dismissed attempts to trademark a single colour.  Arguments against issuing single colour trademarks:<ul><li>Colour depletion theory: Only around 1,867 solid Pantone colours exist. We'll run out if brands all claim a colour.</li><li>Shade confusion theory: It would be hard for consumers to differentiate between slight shade variations of colours claimed by brands.</li></ul>

For years, colour by itself did not qualify as a trademark

In the late 1950s, Owens-Corning was facing steep competition from other fibreglass insulation companies.  Owens-Corning decided to distinguish itself by infusing its product with pink dye. The company adopted the slogan "think pink" and spent tens of millions of dollars advertising the colour. In 1985, after a 5-year battle, Owens-Corning became the first company in American history to successfully trademark a colour. Ten years later, the Supreme Court ruled that colour could serve to identify a brand.

The first company in American history to successfully trademark a colour

A number of companies a have trademarked single colours. <ul><li>In 1998, Tiffany & Co. trademarked its famous blue, and UPS trademarked its “Pullman Brown.”</li><li> 3M secured its signature canary yellow colour for its Post-it notes.</li><li>Deutsche Telekom AG protected T-Mobile’s famous magenta, and Fiskars has one for orange scissor handles.</li><li>The Wiffle Ball, Inc. has a trademark on yellow for use in bats.</li><li>The University of Texas at Austin (<a href="https://www.utexas.edu/brand-guidelines/brand-identity/primary-colors">Pantone 159</a>) and The University of North Carolina at Chapel Hill (<a href="https://www.pantone.com/color-finder/542-C">Pantone 542</a>) both have protections on their school colours.</li></ul>

How to trademark a colour

A company with a colour trademark only “owns” the colour in connection to particular goods or services.To successfully secure such a trademark, a firm must prove that a single colour:<ul><li>Achieves “secondary meaning” (distinguishes a product from competitors and identifies the company as the definitive source of the product)</li><li>It doesn’t put competitors at a disadvantage by affecting cost or quality.</li><li>It doesn’t serve a functional purpose.</li></ul>

Securing a colour trademark

Brands will go through the trouble of trademarking a colour when it is critical to the band, sales, or how the product is marketed. When a company files a trademark in black and white — the trademark is protected in all colour variations by default. So nobody can take the McDonald’s red and yellow logo, make it purple and green, and claim it as his own.

Trademarking a colour is worth the effort

A handful of companies have pushed the boundaries of intellectual property law by laying claim to individual colors.

Can a corporation "own" a color?

Competitive advantage fades away faster than any time in recent memory. In the 1980s, if you had a performance edge over your competitors, you could reasonably expect to continue being a leader for around 10 years, on average. But now the half-life of that advantage has shrunk to just one year. That means that short-lived success is actually still very common, but sustained success becomes very hard and very rare. That means that, actually, reimagination is the new execution. In order to stay on top, or even just to tread water and stay still, you need to constantly reimagine your business.

Reimagination Is The New Execution

But reimagination is not so simple if you already have a highly successful business model. We become prisoners of the mental models that underpin our past success. In fact, Martin Reeves found in dealing with businesses that you can’t really stretch your strategy unless you stretch your mind.Now play is of course a great way of stretching your mind. Reeves is not suggesting literally that executives huddle around a conference table with a big pile of Lego bricks, for example; instead he’s created a series of imagination games to help executives to stretch their thinking.

Business Play - The Imagination Games

Let’s suppose that you’re stuck in the rut of seeing the world through the lens of your past and current success. Reeves would recommend the “Anti-Company Game,” and here’s how it works. You get a piece of paper, you create a list of everything which is essential to your strategy - everything which underpinned your past success, everything which is core and sacred - and then you flip it. You create the exact mirror-image list of assumptions, and then you make the best business case for this antiself. You’ll be surprised at the ideas that it triggers.

Game 1: The “Anti-Company Game”

You’re the CEO of a hotel chain. Inconveniently, you don’t actually own any hotels or any rooms or even operate any hotels or any rooms anywhere. Ridiculous - quite possibly - but actually, how would you know the difference between ridiculous and the merely unfamiliar, untried and uncomfortable? Actually, had the executives of hotels played the “Anti-Company Game” before 2007, they might have been able to foresee the appearance of Airbnb, the hotel-less hospitality company, and they might have been able to stave off disruption by preemptively disrupting themselves.

The “Anti-Company Game” Example

On the edge of your industries - on the edge of every industry - are a population of maverick companies that are taking a bet against the incumbents’ business model and their view of the future. Actually, they have no choice because to be a miniature version of the incumbent would not be viable. Now, it’s easy not to notice them - many of them are small companies. It's easy to deliberately overlook them with some justification. Many startups disappear fairly quickly after being founded. And it’s very, very tempting, given all of your experience in the business, to judge them.

Game 2: The “Maverick Game”

“Do these mavericks know what they’re doing? Does their business model make sense? Will they ever make any money?”But instead of judging them from the comfort and the confidence of your position, try assuming that it’s they that have the right bet on the future. Think about the consequences of that for your business model. Try making the best case for their idea.

… Or, The “Switch Game”

You are the CEO of a company that makes equipment that makes semiconductors. Naturally, you’d probably spend most of your time and attention on your main customer industry, the electronics industry. And if it so happened, that a couple of maverick bioscience companies were tinkering with your patents and your technologies, you might overlook that as a distraction, an irrelevance.

The “Maverick Game” Example

But actually, Brooks Automation, a leader in the field, decided to take a close-up look at such a group of mavericks to see whether it could learn anything. And it realized that, actually, the same techniques and technologies which can be used to handle delicate semiconductors can also be applied to other fragile and easily contaminated materials, like biological samples. And puzzling on the significance of this, they reimagined how to handle and store and transport and label and identify biological samples. In fact, they became a successful pioneer in the new industry of automated biobanking.

Now, not everything in business goes according to plan. In fact, sometimes the plans go horribly awry. But you know what? That can be a source of inspiration, too. Enter the “Pre-Mortem Game”: your role in this game is to write the obituary for your company, which is going to fail with 100% certainty in 5 years’ time. What is the cause of death? What will have been the point of failure? Why will it have failed? How will it have failed?

Game 3: The “Pre-Mortem Game”

The challenge in the “Pre-Mortem Game” is that it’s easy to be seduced into the baseline fallacy. The baseline fallacy is the idea that it’s the current business model which is the low-risk bet. And of course that tends to be true until it isn’t true, at which point it’s probably too late to do anything about it.

The Trap: The Baseline Fallacy

Your employees are an early-warning indicator. They will have intuitions if the model begins to slip, but it’s very hard for them to speak up. And it’s even taboo for them to speak up when the business model is under pressure. But when executives create playgrounds - spaces for the safe exploration of alternatives and alternative scenarios - then you get to tap into your employees’ considerable experience about the vulnerabilities and the weak spots and the blind spots of your company.

The Way Out: Your Employees

It’s probably been quite a while since we last visited the local banking branch, right? Had bricks-and-mortar banks played the “Pre-Mortem Game,” perhaps they would have heard their employees expressing some concerns about the gradually dwindling flow of customers to local branches. And perhaps they would have been slightly less taken by surprise when companies like NewBank, a digital native, seized, very rapidly indeed, on that opportunity to convince, to date, more than 40 million Latin Americans that in-person transactions in real buildings were a quaint but obsolete relic of the past.

The “Pre-Mortem Game” Example

It’s only when you bring your vulnerabilities into full view in this way that you may be motivated to reimagine your business and to do so in a robust manner. It’s why the Roman Catholic Church invented the role, the position of the Devil’s advocate in the 16th century to test the future consequences of its decisions to appoint new saints. They did that by imagining what would Satan say or propose or counterpropose, in addition to the normal procedure of thinking about the big man upstairs.

Beatification, Canonization And The Devil’s Advocate In Business

Any human being, any employee, any team and therefore any company can harness human imagination. It’s a defining trait of our species. Failures to imagine in business are really failures of leadership. Business is a serious matter, but it should not exclude play. When leaders embrace play and imagination games, they can unlock the imagination of their employees, uncover disruptive new strategies and renew their lease on the future.

An Infinite Game Shouldn’t Be Played Like A Finite One

Successful business strategy is about actively shaping the game you play, not just playing the game you find.

The essence of strategy lies in creating tomorrow’s competitive advantages faster than competitors mimic the ones you possess today.

Competitive strategy is about being different. It means deliberately choosing a different set of activities to deliver a unique mix of value.

Strategies for taking the hill won’t necessarily hold it.

Play is spontaneous and pleasurable but, more importantly, it accelerates and derisks learning. When we’re kids, it helps us to try out new behaviors, to refine those behaviors and to imagine what is not but what could be or what will be. Martin Reeves, a business strategist dealing with adults, argues that, in fact, play in business is not just possible: it’s essential and even urgent. Here’s why.

To thrive in today's competitive economy, you need to constantly reimagine your business. So what's the secret to sustained success? Strategist Martin Reeves makes a pitch for embracing play to spark innovative business ideas -- and invites you to try out a series of imagination games that he uses to get leaders to stretch their thinking and dream up new possibilities.

mindfulness

Mindfulness

leadershipandmanagement

Leadership & Management

The Business Games: Why Play is Essential for Business

A product recall can create agony for a startup, but the most significant risk is not executing the recall itself. Instead, how you communicate with your customers, staff, and the government will determine the long-term financial impact on the company.

A product recall

Companies should plan to establish a process for recalls. Planning should include customer communication, supply-chain investigation, government communications, and legal response. A recall involves sales, public relations, production, legal, and your research-and-development team. Ensure to integrate crisis planning into your continual monitoring of products, ingredients, and supply chain.

Have a plan

Great leaders overcommunicate, whether they are strengthening the brand identity of a company, the brand belief by employees, or solidifying the support of a board or investors. When explaining the situation, break it down into chunks: what happened, why it happened, what you are doing, and why people can trust this will not happen again. It's not impossible to restore customers' faith. You can neutralize a crisis and make your customers believe in the long-term vision.

Overcommunicate

A product recall is not about you. It's about making it right for your customer. A brand that spends all their energy trying to cover their tracks may find their integrity questioned.  Business owners should consider the Trust Equation - credibility, reliability, and intimacy divided by self-orientation. The more self-interest a company conveys, the less trust they convey.

Don't make it about you

Experts say a recall doesn't have to be the death knell of your company. But maintaining consumer trust takes both planning and deft, empathic communication.

How to Recall a Product Without Alienating Your Customers

For many years Duolingo offered a free app, the company running on investor money. After they raised an 100M VC round from Google they realised they have to start making money:<ul><li>Their first iteration was a user generated translation service they offered to CNN & Buzzfeed. It made them so little money it was shut down.</li><li>They finally landed on ads as a way to incentivise people to get a pro subscription.</li></ul>The ads were chosen because offering the app for free was a key value proposition. The challenging part was convincing the team to go with it, as most of Duolingo thought ads were inherently evil.

Duolingo's Journey to Monetization

Duolingo has a userbase split between:<ul><li>Professionals who want to learn English. Because knowing English is the universal booster to your career.</li><li>Hobbyists who think playing language games are better than scrolling Instagram.</li></ul>Considering the split, phone apps like Insta or Tiktok are Duolingo's biggest competitors.

Duolingo's Userbase

Duolingo is the biggest learning app in the world and the founder was cool to share some honest insights.

Luis von Ahn, Co-Founder and CEO of Duolingo — How to Be (Truly) Mission-Driven, Monetization Experiments, 10x Growth, Org Chart Iterations for Impacting Metrics, The Intricate Path to an IPO, Best Hiring Practices, Catching Exam Cheaters, The Allure of Toto Toilets, The Future of Duolingo, and How to Stand Out in Your Career | Brought to you by Athletic Greens all-in-one nutritional supplement, Helix Sleep premium mattresses, and LinkedIn Jobs recruitment platform with 800M+ users. More on all three below.Luis von Ahn (@LuisvonAhn) is an entrepreneur and consulting professor at Carnegie Mellon University, who is considered one of the pioneers of crowdsourcing. He is known for co-inventing CAPTCHAs, being a MacArthur fellow, and selling two companies to Google in his twenties.He is currently the co-founder and CEO of Duolingo, a language-learning platform created to bring free language education to the world. With more than 500 million users, it is now the most popular language-learning platform and the most downloaded education app in the world.Luis has been named one of the Brilliant 10 by Popular Science, one of the 50 Best Brains in Science by Discover, one of the Innovators Under 35 by MIT Technology Review, and one of the 100 Most Creative People in Business by Fast Company. Luis also won the 2018 Lemelson-MIT prize, the largest cash prize for invention in the U.S.This episode is brought to you by LinkedIn Jobs. Whether you are looking to hire now for a critical role or thinking about needs that you may have in the future, LinkedIn Jobs can help. LinkedIn screens candidates for the hard and soft skills you’re looking for and puts your job in front of candidates looking for job opportunities that match what you have to offer.Using LinkedIn’s active community of more than 800 million professionals worldwide, LinkedIn Jobs can help you find and hire the right person faster. When your business is ready to make that next hire, find the right person with LinkedIn Jobs. And now, you can post a job for free. Just visit LinkedIn.com/Tim.*This episode is also brought to you by Athletic Greens. I get asked all the time, “If you could use only one supplement, what would it be?” My answer is usually AG1 by Athletic Greens, my all-in-one nutritional insurance. I recommended it in The 4-Hour Body in 2010 and did not get paid to do so. I do my best with nutrient-dense meals, of course, but AG further covers my bases with vitamins, minerals, and whole-food-sourced micronutrients that support gut health and the immune system. Right now, Athletic Greens is offering you their Vitamin D Liquid Formula free with your first subscription purchase—a vital nutrient for a strong immune system and strong bones. Visit AthleticGreens.com/Tim to claim this special offer today and receive the free Vitamin D Liquid Formula (and five free travel packs) with your first subscription purchase! That’s up to a one-year supply of Vitamin D as added value when you try their delicious and comprehensive all-in-one daily greens product.*This episode is also brought to you by Helix Sleep! Helix was selected as the #1 overall mattress of 2020 by GQ magazine, Wired, Apartment Therapy, and many others. With Helix, there’s a specific mattress to meet each and every body’s unique comfort needs. Just take their quiz—only two minutes to complete—that matches your body type and sleep preferences to the perfect mattress for you. They have a 10-year warranty, and you get to try it out for a hundred nights, risk-free. They’ll even pick it up from you if you don’t love it. And now, Helix is offering up to 200 dollars off all mattress orders plus two free pillows at HelixSleep.com/Tim.*For show notes and past guests on The Tim Ferriss Show, please visit tim.blog/podcast.For deals from sponsors of The Tim Ferriss Show, please visit tim.blog/podcast-sponsorsSign up for Tim’s email newsletter (5-Bullet Friday) at tim.blog/friday.For transcripts of episodes, go to tim.blog/transcripts.Discover Tim’s books: tim.blog/books.Follow Tim:Twitter: twitter.com/tferriss Instagram: instagram.com/timferrissYouTube: youtube.com/timferrissFacebook: facebook.com/timferriss LinkedIn: linkedin.com/in/timferrissPast guests on The Tim Ferriss Show include Jerry Seinfeld, Hugh Jackman, Dr. Jane Goodall, LeBron James, Kevin Hart, Doris Kearns Goodwin, Jamie Foxx, Matthew McConaughey, Esther Perel, Elizabeth Gilbert, Terry Crews, Sia, Yuval Noah Harari, Malcolm Gladwell, Madeleine Albright, Cheryl Strayed, Jim Collins, Mary Karr, Maria Popova, Sam Harris, Michael Phelps, Bob Iger, Edward Norton, Arnold Schwarzenegger, Neil Strauss, Ken Burns, Maria Sharapova, Marc Andreessen, Neil Gaiman, Neil de Grasse Tyson, Jocko Willink, Daniel Ek, Kelly Slater, Dr. Peter Attia, Seth Godin, Howard Marks, Dr. Brené Brown, Eric Schmidt, Michael Lewis, Joe Gebbia, Michael Pollan, Dr. Jordan Peterson, Vince Vaughn, Brian Koppelman, Ramit Sethi, Dax Shepard, Tony Robbins, Jim Dethmer, Dan Harris, Ray Dalio, Naval Ravikant, Vitalik Buterin, Elizabeth Lesser, Amanda Palmer, Katie Haun, Sir Richard Branson, Chuck Palahniuk, Arianna Huffington, Reid Hoffman, Bill Burr, Whitney Cummings, Rick Rubin, Dr. Vivek Murthy, Darren Aronofsky, and many more.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

education

Learning & Education

Brought to you by Athletic Greens all-in-one nutritional supplement, Helix Sleep premium mattresses, and LinkedIn Jobs recruitment platform with 800M+ users. Luis von Ahn (@LuisvonAhn) is an entrepreneur and consulting professor at Carnegie Mellon University, who is considered one of the pioneers of crowdsourcing. He is known for co-inventing CAPTCHAs, being a MacArthur fellow, and selling two companies to Google in his twenties.He is currently the co-founder and CEO of Duolingo, a language-learning platform created to bring free language education to the world. With more than 500 million users, it is now the most popular language-learning platform and the most downloaded education app in the world.Luis has been named one of the Brilliant 10 by Popular Science, one of the 50 Best Brains in Science by Discover, one of the Innovators Under 35 by MIT Technology Review, and one of the 100 Most Creative People in Business by Fast Company. Luis also won the 2018 Lemelson-MIT prize, the largest cash prize for invention in the U.S.This episode is brought to you by LinkedIn Jobs. Whether you are looking to hire now for a critical role or thinking about needs that you may have in the future, LinkedIn Jobs can help. LinkedIn screens candidates for the hard and soft skills you’re looking for and puts your job in front of candidates looking for job opportunities that match what you have to offer.Using LinkedIn’s active community of more than 800 million professionals worldwide, LinkedIn Jobs can help you find and hire the right person faster. When your business is ready to make that next hire, find the right person with LinkedIn Jobs. And now, you can post a job for free. Just visit LinkedIn.com/Tim.*This episode is also brought to you by Athletic Greens. I get asked all the time, “If you could use only one supplement, what would it be?” My answer is usually AG1 by Athletic Greens, my all-in-one nutritional insurance. I recommended it in The 4-Hour Body in 2010 and did not get paid to do so. I do my best with nutrient-dense meals, of course, but AG further covers my bases with vitamins, minerals, and whole-food-sourced micronutrients that support gut health and the immune system. Right now, Athletic Greens is offering you their Vitamin D Liquid Formula free with your first subscription purchase—a vital nutrient for a strong immune system and strong bones. Visit AthleticGreens.com/Tim to claim this special offer today and receive the free Vitamin D Liquid Formula (and five free travel packs) with your first subscription purchase! That’s up to a one-year supply of Vitamin D as added value when you try their delicious and comprehensive all-in-one daily greens product.*This episode is also brought to you by Helix Sleep! Helix was selected as the #1 overall mattress of 2020 by GQ magazine, Wired, Apartment Therapy, and many others. With Helix, there’s a specific mattress to meet each and every body’s unique comfort needs. Just take their quiz—only two minutes to complete—that matches your body type and sleep preferences to the perfect mattress for you. They have a 10-year warranty, and you get to try it out for a hundred nights, risk-free. They’ll even pick it up from you if you don’t love it. And now, Helix is offering up to 200 dollars off all mattress orders plus two free pillows at HelixSleep.com/Tim.*[05:03] Why the Duolingo owl is green[06:47] The core cause behind Duolingo’s creation, and how Duolingo has evolved over the years[12:48] Duolingo’s monetization efforts that didn’t quite pan out[21:06] After initial reluctance, how was the Duolingo workforce convinced monetization needed to happen?[25:06] As machine-driven translation services get more sophisticated, will human beings still seek to learn other languages via Duolingo?[29:31] The most pursued/influential languages in the Duolingo system currently[39:14] The development of Duolingo’s org chart[45:40] Why Duolingo uses a daily metric[48:33] Book recommendations[50:26] Luis’ most worthwhile investments[52:20] New beliefs, behaviors, or habits[55:20] Recent life-changing purchases[1:02:39] What Luis’ updated 2022 billboard might say[1:06:14] What Luis means when he refers to Duolingo’s “mission,” and how the company’s long view affects decision making[1:12:34] How Duolingo hires good candidates for the long haul[1:18:50] Why and how Duolingo went public[1:25:42] The biggest challenges Luis faces as CEO of a public company[1:30:50] Duolingo is expanding to teach more than languages[1:36:18] The Duolingo English Test: proficiency testing from home accepted by 4,200 academic programs across the world[1:39:51] How Luis’ expertise at catching cheaters during his time as a professor at Carnegie Mellon makes Duolingo products more trustworthy as accredited sources[1:43:39] The brief conversation with Luis’ personal trainer that changed his routine breakfast — to a different routine breakfast[1:44:38] Advice to young, driven people entering the working world[1:48:07] How Luis has become better at saying “No.”[1:49:56] Luis’ request of the audience and parting thoughts*For show notes and past guests on The Tim Ferriss Show, please visit tim.blog/podcast.For deals from sponsors of The Tim Ferriss Show, please visit tim.blog/podcast-sponsorsSign up for Tim’s email newsletter (5-Bullet Friday) at tim.blog/friday.For transcripts of episodes, go to tim.blog/transcripts.Discover Tim’s books: tim.blog/books.Follow Tim:Twitter: twitter.com/tferriss Instagram: instagram.com/timferrissYouTube: youtube.com/timferrissFacebook: facebook.com/timferriss LinkedIn: linkedin.com/in/timferrissPast guests on The Tim Ferriss Show include Jerry Seinfeld, Hugh Jackman, Dr. Jane Goodall, LeBron James, Kevin Hart, Doris Kearns Goodwin, Jamie Foxx, Matthew McConaughey, Esther Perel, Elizabeth Gilbert, Terry Crews, Sia, Yuval Noah Harari, Malcolm Gladwell, Madeleine Albright, Cheryl Strayed, Jim Collins, Mary Karr, Maria Popova, Sam Harris, Michael Phelps, Bob Iger, Edward Norton, Arnold Schwarzenegger, Neil Strauss, Ken Burns, Maria Sharapova, Marc Andreessen, Neil Gaiman, Neil de Grasse Tyson, Jocko Willink, Daniel Ek, Kelly Slater, Dr. Peter Attia, Seth Godin, Howard Marks, Dr. Brené Brown, Eric Schmidt, Michael Lewis, Joe Gebbia, Michael Pollan, Dr. Jordan Peterson, Vince Vaughn, Brian Koppelman, Ramit Sethi, Dax Shepard, Tony Robbins, Jim Dethmer, Dan Harris, Ray Dalio, Naval Ravikant, Vitalik Buterin, Elizabeth Lesser, Amanda Palmer, Katie Haun, Sir Richard Branson, Chuck Palahniuk, Arianna Huffington, Reid Hoffman, Bill Burr, Whitney Cummings, Rick Rubin, Dr. Vivek Murthy, Darren Aronofsky, and many more.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Tim Ferriss is a self-experimenter and bestselling author, best known for The 4-Hour Workweek, which has been translated into 40+ languages.  Newsweek calls him "the world's best human guinea pig," and The New York Times calls him "a cross between Jack Welch and a Buddhist monk."  In this show, he deconstructs world-class performers from eclectic areas (investing, chess, pro sports, etc.), digging deep to find the tools, tactics, and tricks that listeners can use.

The Tim Ferriss Show

#607: Luis von Ahn, Co-Founder and CEO of Duolingo — How to Be (Truly) Mission-Driven, Monetization Experiments, 10x Growth, Org Chart Iterations for Impacting Metrics, The Intricate Path to an IPO, Best Hiring Practices, Catching Exam Cheaters, The Allure of Toto Toilets, The Future of Duolingo, and How to Stand Out in Your Career

The Co-Founder of Duolingo on Tim Ferriss

A valuable product or service is integral to starting your creative business. Still, to run and manage your business successfully, you need to consider other factors such as:

Things You Need To Know Before starting Your Business 

Branding Is About Loyalty—Not Just LooksYour branding should draw upon components of communication to give people an idea of what you’re all about and what to expect when working with you.It’s not just about logos, though the visuals on your business cards and Web site are a key aspect of branding. It’s really more about the client’s experience. You want to use your brand—logos, content development, publicity, and the like—to build credibility, convey a message, and encourage loyalty. You want prospects and clients to want you and only you.

Branding   

One of the nicest things about being your own boss is being able to negotiate your rate. Everything is negotiable; don’t be offended if a client asks you to come down a bit, but know that you have the power to negotiate just as much as a client.When you set your rate, make sure you go high enough so that if you decide to come down in price, you are still making enough money to turn a profit on the project.

Negotiations 

Tips that help small business owners, start and run their businesses successfully 

A Dozen Things You Need To Know Before Starting Your Creative Business

Find 100+ Business Facts, Ideas & Insights - Curated from inspiring sources like Books, Podcasts & Articles - Genuine Insights from like-minded Users like You!

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The Co-Founder of Duolingo on Tim Ferriss

A Dozen Things You Need To Know Before Starting Your Creative Business

How to Build the Ultimate Productivity System (2022)

It's time to
Read like a Pro.

What is supply chain?

How Paper Catalogs Remain Relevant in a Digital Age

Organizational Transformation Is an Emotional Journey

Monetisation Secrets from Jake Mor

Can a corporation "own" a color?

The Business Games: Why Play is Essential for Business

How to Recall a Product Without Alienating Your Customers

The Co-Founder of Duolingo on Tim Ferriss

A Dozen Things You Need To Know Before Starting Your Creative Business

How to Build the Ultimate Productivity System (2022)

It's time to Read like a Pro.

It's time to
Read like a Pro.