Me to the Moon:
It’s What Your Customers Want
By Lior Arussy
New York Times recently reported that over 13,000 reservations
have been made for Virgin Galactic flights, scheduled to start in
2007. For those of you who
are not familiar with Virgin Galactic, it is Richard Branson’s
latest endeavor offering flights into space.
Virgin Galactic’s 3-hour flight sells for the whopping price
of $200,000 per seat. Evidently,
price is not a deterrent. To
top it off, customers are willing to wait several years for this
I read this, I felt that it reinforced what everyone knows, but which
average companies, despite their protestations to the contrary, do not
deliver. Customer tastes
as well as their definition of excitement are moving targets. What’s
hot today may be old news tomorrow.
What was fun last summer may be passť this June.
experiences must be fresh and exciting each and every time.
A 1999 experience is a commodity at this point.
The example above demonstrates that customers will pay for
great experiences ($200,000 for 3 hours flight! And they said the
airline industry is suffering…).
All that passengers ask is that the experience be fresh and
companies continue to devalue their experiences and offer less to
customers while attempting to charge more – all this in the name of
consistency and cost-reduction. For
customers on the receiving end, it is a contradictory proposition,
which they resist. Customers
can quickly spot commoditized products and services and respond by
looking for versions offering the best deal for them.
Consistency is simply not good enough.
Consistency leads to boredom which leads customers to look
Richard Branson were the average corporate leader, Virgin Atlantic
Airways’ success would have left him feeling quite satisfied (and
complacent). However, like
that other upstart, Jet Blue, Branson’s airline is aggressive about
redefining air travel and as a result, both have earned strong
is the envy of many others. Generous
value offerings like free massages in Upper Class (Business Class), a
greater selection of entertainment, and pampering services in their
club house at Heathrow airport have earned them huge customer loyalty.
But rather than stop there, Sir Branson has taken the next leap
by, quite literally, taking his customers to the moon.
Rather than incremental improvements in things like flight
schedules or new city
stops, he has
taken a dramatic leap by focusing on the next frontier.
why aren’t other companies doing the same thing?
The answer can be summed up in two words: “risk” and
tolerance at companies is shrinking as they become more risk averse.
The larger the company, the less risk it is willing to take.
Complacency sneaks in once the first, successful product is
realized, and it stays there. Managers
mistakenly assume that their initial success will last forever. The
truth isn’t discovered until they observe that their lost market
share and leadership position has moved to the smaller, more
is plenty of talk these days in corporate offices about growth and
innovation. The pendulum
has shifted from efficiency and cost reduction programs to growth and
innovation. Growth and
innovation, however, are tied to higher levels of risk tolerance and
as well all know, the greater the risk, the greater the breakthrough.
But most companies do not want to assume such risk.
“Nothing ventured, nothing gained” evidently, does not
apply to them.
problem however is not just the formal attitude toward risk.
It is also the culture the feeds it.
To assume risk you need a person to take it on.
Corporate leadership is reluctant to take the risk that will
drive “the next big thing.” They
have too much vested to make a move that may jeopardize their next
promotion or perhaps even their job.
The reason for this reluctance has to do with the
way corporations treat mistakes. There
is a fine line between success and failure as both require a fair
amount of good intentions and investment of resources, making them
equally important to any company.
As to the rewards, success is naturally rewarded whereas a
demotion or dismissal may come with failure.
the formal approach and the acceptance towards risk changes, companies
have no hope for developing breakthrough innovations that will deliver
value to their customers. As
long as companies continue to recognize and idolize success and
dismiss failure (and sometimes the people who fail) employees will
take the road most traveled rather than the road less traveled.
They simply will not be able to justify the tremendous personal
and professional risk required.
is a certain element of paranoia as well as fun in Richard Branson’s
constant innovation. He
views the world as a playground for invention and improved value; and
than charges handsomely for it. There
are no secrets to his approach, just a willingness to take risks, make
change and challenge the establishment.
Sir Branson has the ability to laugh at himself and is willing
to fail in order to succeed. In
short, he is willing to take his customers to the moon.
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