Which event is more likely to set off the next round of business growth? Will it start with a flashy product launch or a 5-minute phone call at the end of the day?
The smart money is on the conversation.
Simple conversations have led to critical insights and dramatic changes that restructured the companies involved and redefined their impact on the world.
The $2 billion voice mail
In the last days of the 20th century, Nick Swinmurn became convinced that people wanted to buy shoes using a strange, new technology called “The World Wide Web.” Venture capitalists told him he was crazy, even though 5% of shoe sales nationally came through mail-order catalogs. Swinmurn's business model just moved the contents of those catalogs to the inside of a computer screen. At the end of his rope, Swinmurn acted on a tip and called Tony Hsieh of the VC firm Venture Frogs. No one picked up the phone.
In a Hail Mary pass situation, Swinmurn left a voice mail with his impressive shoe catalog sales stat. Hsieh nearly hit delete, but instead hit rewind and listened more carefully. He calculated that 5% of the $40 billion shoe market was $2 billion, and there was a growing demand for handling business entirely online.
Hsieh said, “It didn’t matter whether I would be willing to buy shoes without trying them on first. What mattered was that consumers were already doing it.” From that point, he was hooked and the conversation turned to how they would co-create an unbeatable customer experience.
The result was Zappos, which set the standard for customer service in ecommerce and was sold to Amazon for $1.2 billion.
Takeaway: Lead with what matters most to the person you are calling, not what matters most to you.
The return of simply talking
Starbucks was cool in late 1990s. It was a little-known Seattle-based coffee shop popping up all over the US, especially in California. Suddenly “gas-station coffee” was unacceptable and the nation discovered it had a caffeine obsession. By 2008, the game was played out and Starbucks was old news. Other startups were cooler and Starbucks stock was tumbling fast. Costs were rising while sales were dripping away to fierce competitors.
Howard Schultz was brought back in 2008 to give the company an eye-opening jolt of profitability. On a call with a powerful shareholder, Schultz was told it was time to cut health care for employees. Schultz pushed back, diplomatically. Brand means everything in the coffee world and Schultz knew that brands are built on conversations.
He invested heavily social media and tried 100 strategies to get customers talking again – to the company and to each other. He fostered online communities like “the free Wi-Fi group” and “frappuccino lovers.”
Now Starbucks is coming on strong again, expanding the number of stores to 37K by 2021 and growing earnings per share by 15-20% on over $20 billion in revenue.
Takeaway: Cutting costs is good, but referrals from happy customers is better. Technology that makes conversations easier are valuable, low-cost tools for building the brand.
The pre-history of the smartphone
Apple’s iPhone gets a lot of credit for launching the mobile revolution in 2008, but there were smartphones before it. What made the iPhone so great at the time was not just the cool design of the hardware. It was the vast capabilities made possible by the app ecosphere that came with the iPhone.
That would have never been possible without the Palm. It may be hard to believe now but for many years it took a fast processor to run effective business software. In the early 1990s, desktops with installed software were the primary way people ran business operations and the internet was mostly used for email.
Dennis Boyle at the design firm Ideo was blown away by the concept of the Palm, a handheld device with simple applications and 500 kb of memory. Ideo had designed the first mouse for Apple and they understood that nothing is cool until people start talking about it. He picked up the phone and called the leadership team at Palm, saying he could design something better.
The Palm V was outrageous. It was light, sleek and “encased in the kind of anodized-aluminum skin usually reserved for James Bond guns.”
The next generation, Palm VII, did something even more amazing. Its giant antenna connected users to the web on Palm.net, opening up ebooks on Amazon, directions on MapQuest, or the world on Encyclopedia Britannica. In 1999, it became this was prototype of the mobile device that the world would hunger for a decade later.
Takeaway: Staying open to conversations that can introduce your business to ideas that can literally change the world. Set aside time for long-range strategies and the tech you will need to get there.
The power of voice
Scandinavian Airlines was doing fine attracting leisure travelers, but had a hard time connecting with business customers, where is where all the profit is in airline travel. Professionals expected a higher level of service and didn’t have time to wait for a supervisor to approve their requests.
When Jan Carlzon took over as CEO of the SAS group, his task was to train front line workers how to improve the customer experience for business travelers. His answer was to launch a series of internal conversations.
Carlzon wrote, “Anyone who is not given information cannot assume responsibility. But anyone who is given information cannot avoid assuming [responsibility].” Before customer-facing agents could be given more autonomy and authority, they needed to truly understand what company leaders wanted to achieve.
These conversations led him to institute the flat organization structure that earned Carlzon and SAS recognition for introducing “one of the most important developments in management during the 20th century.”
Takeaway: Empowering employees is not a loss of control as long as their priorities are aligned with yours. Only two-way conversations can bring teams together around a common goal.
The shape of things to come
This is the story of your business. Was there a conversation that changed everything for you and your plans to grow the company? Your most important conversation may not have happened yet. More conversations = more discovery, and could lead your company in directions you haven't even considered yet.
How much is a conversation really worth? A survey by the Society for Human Resource Management found that a companies around 100 employees could reclaim $420,000 per year in lost productivity simply by helping workers improve their conversational skills.
Takeaway: Put technology and training in place to help your employees get more calls made and answered. That minimizes communications breakdowns both internally and with your customers.
The age of conversation
In the past, two of the biggest expenses for in starting a small business used to be the office lease and the phone system. These were assumed to be the backbone of the business and it was hard to imagine operating without them.
This is no longer true.
Now, the essentials that a business needs to succeed are valuable services and a brand reputation for excellence in customer experience.
Disruptive business models alone can’t win customers away from established industry giants. New companies are built on positive customer conversations across their networks and the amplified power of voice.
Spoke Phone can transform the mobile phones that you and your employees already have into low cost business phone system with all the features your company needs. Designed for the emerging mobile workforce, Spoke offers advanced capabilities like geo-routing calls to the closest employee, and AI auto-attendant that can answer in the language of the caller, mobile-to-mobile call transfer and other features of a virtual PBX.
We’re also developing cool new tools for professionals who work and live on the go, such as a shared call log, an employee directory that automatically updates, and data analysis on which calls need a follow up.
Next up on Spoke’s evolving platform is voice-to-text transcription, voice notes post-call, and applets that let you clip and share snippets of your call. Our intuitive interface is easy to use on the go, allowing your team to easily take and transfer calls, while saving and sharing vital call details. If you want to get set up for your own demo, let's just talk.
What would have happened if these innovators had failed to make a connection at precisely the right moment? More importantly, what would have happened if nothing happened after the initial conversation? Making time for more conversations and following up on the insights could be the smartest business decisions of all.