Can We All Be Purple Cows?

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Loren Feldman:
Welcome Shawn, Jay, and Jaci. It’s great to have you here. I want to talk today about something I’ve wondered about for a while. We often hear the advice that it’s a bad idea to try to sell a product or service that is viewed as a commodity. You need to find a niche or to distinguish yourself in some way. But here’s my question: Aren’t some businesses just commodity businesses? And if so, what can a small business do to succeed if it’s pretty much a commodity business? Jaci, have you thought about this at all?

Jaci Russo:
We’ve worked with a number of clients in that space with that predicament. So I guess I would start with: Name a commodity business. Because I would say there aren’t really any of those anymore. Even if you look at water and toilet paper, there are some differentiators there. There’s some place where they put themselves—whether it’s through packaging, or through pricing, or through promotion—to try to separate themselves from the herd. You know, humans are a pack animal. And so we want to blend in. It’s our nature. But if we don’t find a way to stand out, you’re not going to be a very successful business for long.

Jay Goltz:
Garbage collection. That’s not commodity? The people that pick up your garbage—that’s not a commodity business?

Jaci Russo:
I would tell you that in Lafayette, Louisiana, where I live, we’ve just been through two different rounds of contracts with different garbage pickup services. They are vastly different in their offerings, in their pricing, in the performance of their service. And we as homeowners don’t get to choose, but the council did. And we very much miss the one we used to have. There was a difference.

Loren Feldman:
So you think, Jaci, if somebody comes to you, and looks like a commodity business, pretty much any business, you can turn them around and make them not a commodity business?

Jaci Russo:
We did it for a milk company. Dairy is probably one of the biggest commodities—and I just used air quotes—out there. And we were able to work with this regional dairy and help them go from zero market share—they’re entering new markets for the first time—and within about six months had 18 percent of the market share against organics, heritage, and store brands, even though they were not as healthy as organic. They were more expensive than the store brand. And heritage means people have just been buying it for generations and generations and buy the same thing that everybody bought. But we were able to carve out a niche for them.

Loren Feldman:
Shawn, let me ask you kind of the same question, but in a slightly different way. As I’m sure you’re well aware, Seth Godin wrote a book called Purple Cow: Transform Your Business by Being Remarkable. It’s a very readable book, and I think it’s obviously good advice. If you can distinguish yourself, you should probably distinguish yourself. But can we all be Purple Cows? Can any business be remarkable? What do you think?

Shawn Busse:
You know, we’re not in the consumer space, like Jaci is. We’re almost entirely B2B. And there are definitely some strong commodity businesses in B2B. I remember meeting a guy who, basically, his business was buying scrap steel. That’s it. He’s buying scrap steel from manufacturers, who have offcuts and waste and so forth. And, boy, that is a tough business, because the buyer in that space is some sort of procurement type of person. And so they’re buying largely on price, and it’s hard to defeat that. I ultimately walked away from the engagement, even though he wanted to put money on the table, because I don’t think he was willing to do what would have needed to be done to be a Purple Cow.

And I think that for companies where that are closer to being a pure commodity, you have to be a lot more bold. And usually that boldness comes in either the form of culture, where you’re creating a place where employees are really engaged and doing amazing work, because then the customer feels that and then you’re differentiated on that. Or the offering, the process, the way you do things is significantly different in the way you deliver that commodity. And both of those things require a lot of vision from the leader. And a lot of times, what I have found, at least in my experience, is that in a lot of commodity-based businesses, the leaders are really fixated on winning by price—by being cheaper than the other guy, as opposed to service, delivery, process, or culture.

Jay Goltz:
Well, you left a whole piece out, though. There’s a whole piece of that, which is: What if the company figured out how to do it cheaper? I mean, I’ve sold scrap. When I cut aluminum frames, we used to say barrels of scrap. What if they figured out, “Oh, they’ve got a good location that’s closer to the customers? Therefore, I’m paying my truck driver a lot less to go pick up every day.” And they figured out how to get it to the scrap recycler cheaper. That is another angle that somebody figured out. Walmart: Someone figured out how to do things cheaper and pass the savings along. So that’s the commodity, but you can still win by getting your costs down.

Shawn Busse:
Yeah, I think that’s a really good point. You might layer into that like, say, technology. So you could put a piece of technology in place that made you far more efficient than your competition. I tend to think that those kinds of moves can be copied more easily than the moves that I’m suggesting. So that’s why I go to those places first.

Culture is really hard. It’s really hard to do in a commodity space. So if you can do it, it’s much harder for your competition to catch up to you. It’s much more of a moat strategy. I think the way you deliver your service to your customer, something that we’ve called the proprietary way—which is a combination of people, service, process—that amalgam is a sort of secret sauce. It’s really hard to copy, versus a technology play. Once your competitors figure out that technology, if they can buy it off the shelf or build it themselves, it’s a little easier to copy. So I’d say, “Yes, and,” to what you’re saying, Jay.

Jaci Russo:
And I’ll just jump again. You know, Shawn, we’re about 90 percent B2B, too. And so, sure, we’ve dealt with companies that make widgets and small intricate details inside their industries. But I think there’s always a way to separate. If you didn’t start your business knowing you were gonna do something different and better than the rest of the competition, why did you start?

Shawn Busse:
Well, I mean, this will get Jay riled up—

Jay Goltz:
Great!

Shawn Busse:
A lot of times these commodity businesses, they’re owned by the second or third generation. And so you also often have that factor layered in, in that it was their father, their mother, their grandfather, their grandmother who actually was the innovator. And they are sort of keeping the thing going. And so sometimes that can be really challenging to be the innovator when you’re the second or third generation.

Loren Feldman:
Jay, let me ask a question. I think we have someone here who might be able to answer Jaci’s question, and that’s you, Jay. I hope you don’t take offense at this, but isn’t picture framing something of a commodity business? How many picture framers were there in Chicago?

Shawn Busse:
No way, Loren!

Loren Feldman:
How many were there in Chicago when you opened up?

Jay Goltz:
Back in the day of the Yellow Pages, I remember counting the number of frame shops. This was probably 20 years ago. There were 69 frame shops.

Loren Feldman:
Wait, you opened 40 years ago, right?

Jay Goltz:
So I’m just saying, its peak, which was probably in 2000, 20 or 25 years ago, there were 69. And you’ve gotta remember, the framing industry was in a boom for many years, because of the Baby Boomers. They’re framing pictures, and the framing industry really—I’ve been there from the beginning. When I started, it was just starting to pick up steam, and it grew tremendously for the next 45 years. And then it got mature. So then what happened? The chain stores started to pick it up. And now the independent frame shops have shrunk.

So there used to be 69 frame shops in Chicago, and now there’s about 22. And nationally, there were 25,000 frame shops, and now it’s 6,000. So it’s a commodity, in that a lot of people do it, but it’s certainly not a commodity if you do it right. There’s a huge difference between a well-run framing business and someone who just showed up and is doing mediocre framing. There’s no question, which is why my business grew so much.

I didn’t know this. And I certainly couldn’t put the words on it back when—I didn’t start out and go, “Oh, I’m gonna differentiate myself and brand myself better.” I just did a better job. I was more committed to taking care of customers and having better frames, and having better people working there, and having a better turnaround, and having better quality. I just wanted to run a better business, which you can now use a bunch of words to describe, which is differentiation, but that is why I’m bigger than everyone else.

Shawn Busse:
I mean, what we’re talking about here—and I think all three of us will agree on this—is brand experience. And so, that is how you can elevate yourself out of a commodity space. So what Jay is describing is the customer experience. It’s the framer’s knowledge of the product, their ability to add the right value and solution to the customer’s experience. Those are all decommodification strategies that involve culture, customer differentiation, on and on and on.

And so I think that when you are in a space that’s heavily commoditized, those are your ways. I mean, we’ve done this with clients that are in commodity spaces. I think Jaci has done this with clients. It’s about going for brand—and I mean that not from a pretty logo and a pretty website, but actually the customer experience and the employee experience. And if you get those two things right, you’ve kind of beat about 90 percent of your competition at that point.

Jay Goltz:
You know, I’ve learned it’s about being 10 percent better. That’s what we’re talking about. We’re talking about all the stuff you’re describing: brand, which is everything you do; the way your employees dress; the way they talk; where your office is; what your sign looks like; does your chair in your waiting room have a rip in it? All of those things added together, maybe add up to 5-10 percent of your business. You do that for 30 years, and one company does $10 million and the other company’s doing a million. It’s about being a little bit better.

So yes, it’s about running a better business with good branding and good messaging. And I believe, I think our point is, any business can benefit from being non-commodity by attempting to make your business a little bit better, whether it’s the way you are branded, your ads, maybe the person who comes and picks up the scrap is just friendlier than the other guy. I mean, stuff like that makes a difference.

Loren Feldman:
Jay, you’re talking about execution. My question is, is execution—executing well, running the business well—is that enough to take you from a commodity business to a non-commodity business?

Jay Goltz:
Yes. Absolutely.

Jaci Russo:
Yes, because execution comes from process, process comes from intention, and intention comes from planning. And that’s how businesses separate themselves. It is shocking to me how few companies—and I’m sure Shawn will agree—in the B2B and B2C space actually spend the time to plan out their strategic marketing approach. Instead, they are reactive. “Shiny thing! I’m going to do it. Sales pitch from a cute girl. I’m going to do it.” And now all of a sudden, they say, “Why is half my budget wasted?” Well, because you didn’t plan it.

Jay Goltz:
Here, I’ll give you an example. I just went to a doctor’s office out in the middle of nowhere, and the office was all nice-looking and stuff. And the woman behind the counter is wearing a hoodie with blue something on it. And you know what? It’s a doctor’s office. Like, don’t wear a hoodie sweatshirt with printing on it. It doesn’t look good. And I stopped recommending them anymore, because they don’t listen. They will say, this is the line: They always say when you tell them something, “Oh, no one cares about that.” [Laughter]

And the answer is: You know what, you’re 95 percent right. I’m probably only one of the 20 people to think, “Gee, I’d feel a little better if the person behind the counter looked like a professional.” It may be only one out of 20 people, but that’s 5 percent. That’s the difference between being a little bit better.

Shawn Busse:
Yeah, see, I’ve gotta take issue with your simplification, Loren. I think saying that it’s execution is too simplified. And yes, absolutely, we all know, most businesses—especially at the corporate level—are terrible at execution. They’re just awful. But that’s just a piece of it. I think there’s a seductive aspect of execution, which is that, “Wow, I can create lists. I can check things off lists. I can have a process for everything.” And that is wonderful stuff. It’s also highly copyable.

There are pieces of what Jay is telling, in terms of his story, that are not execution. They are pieces of affinity within employees. They are pieces of feeling appreciated. They are pieces of recruiting and retention. These are not really execution things. So when you say execution, you start to get into this world of operations, which is really important. I don’t want to downplay the significance of that. But improving execution has generally kind of a linear output to it, whereas things like culture, process, differentiation, remarkability—those are exponential things. And I really want to caution us about simplifying it to, “Oh, you just need to execute better,” because that’s not what Jay has actually done.

Jay Goltz:
Well, it’s interesting that you say that, but I’m wondering whether it’s a word. What I just heard you say is different than what you said. [Laughter] What I’m hearing you saying is: You can say execution, but it’s really what’s behind the execution that makes the difference. And I totally agree with that. You’re right, it’s, “Oh, get delivery better.” The issue isn’t better deliverables. It’s: Learn how to hire better and keep your employees around. So I absolutely hear your point with: It is execution, but it’s really about, how do you pull that off? And that’s what the issue is.

Shawn Busse:
And then the problem is, the internet has driven us to follow this whole listicle idea, right? “Ten ways you can become better at hiring.” It’s like, okay, that’s fine. But underpinning all of that stuff is: What is your mission? What are your values? What do you care about? How do you treat customers? These are things that I think, Jaci, you and I would agree, these are strategic and really powerful and meaningful aspects of the business that then should drive the execution. And so I just really caution when we start talking about execution, execution, you could run down this path of best practices and copying other people. And those things are good. But the underpinning of that is way more important. Like, 1,000%.

Jaci Russo:
Always.

Jay Goltz:
All you’re saying, which makes sense, is: Corporate culture drives execution. So instead of banging on, “Oh, execute better, execute better.” It’s really about: Your corporate culture includes how you take care of customers, which is execution. So I would agree with you. A better word to tell somebody if you really want to succeed in business and grow, instead of saying, “Execute better,” work on your corporate culture. Because that’s going to enable you to execute better. And I fully agree with that. Are we on the same page with that?

Shawn Busse:
Yes. Yes, and. Like, culture? Huge, huge, huge, huge, and I think not to be undervalued in the conversation about execution. And then also, I think, to your other point, Jay: There’s business, the strategy. Like, how are you going to market? What is the offering? How is it remarkably different? We talked about all these picture framers that existed, and I think you’ve outlasted and outlived a lot of them, because they were sort of business as usual. Right?

Jay Goltz:
Well, the business was growing so much, they just had to show up, and you could do okay.

Shawn Busse:
Yeah, right. And in a good, rising tide, it’s like, “Oh, we’re all so talented here.” And you did something different. And I think that’s the other side of the coin. So you have culture, and then differentiation and remarkability.

Loren Feldman:
Jay, the question that Jaci asked was: If you’re not going to do something different, why would you even start the business? What were you thinking when you started your business? Did you think that you were going to be different than all those others?

Jay Goltz:
Absolutely. No, that’s why I got into the business. First of all, I loved picture framing. I loved the whole process of finding the right frame for the right picture and making a picture look great. And I mean, I loved framing, but I also knew enough about frame shops to know that you’d bring a picture, and you’d say, “When will it be done?” “Uhhh, four or five weeks, give me a call. We’ll see.” [Laughter]

Loren Feldman:
Did you really know that that was standard?

Jay Goltz:
Absolutely. I went with my mother one time. This is a one-time experience. My mother framed one picture, and my mother didn’t drive, so I probably drove her to the frame shop. I was probably 17 or 16 years old. I drove her to the frame shop. And it was a dusty, old frame shop. And I thought to myself, “Why would it take five weeks to frame a picture? It’s not like they’re growing the tree and then they’ve gotta cut it down.” So yes, that was typical in the framing business at the time, “We’ll get it done when we get it done.”

And what I didn’t realize till I was in my late 20s, and business was growing like crazy, was that my attitude toward customers was very different than many frame shop owners. I grew up in my father’s dime store taking care of customers. I enjoyed customers. I liked customers. I support customers. And I found out that a lot of people who were in the frame business viewed themselves as some kind of artist, which is the opposite of customer-driven, when you think about it. Customer-driven is: “What do they need? Give it to them.” Artist-driven is: “Look what I made. Oh, you don’t like it? You’re an idiot. Get out.” [Laughter]

Shawn Busse:
Hey, as an artist, I resent that characterization!

Jay Goltz:
Okay, but you have to admit that artists do things to make themselves happy. They don’t ask a customer, “What color do you think I should make this picture?”

Shawn Busse:
That is true. That is true.

Jay Goltz:
That’s what I’m saying.

Jaci Russo:
That’s absolute fact. I’m married to an artist. Shawn, you cannot even begin to argue that point. That is fact. [Laughter]

Shawn Busse:
No, the first part of his point I agree with. The second part I take issue with.

Jay Goltz:
With a little hyperbole just to get your attention.

Shawn Busse:
A lot of hyperbole.

Jay Goltz:
You are a complete freak. You are. You are a freak that you went from being an artist to being a marketing—I mean, that’s like watching a dog talk. I mean, that’s not a normal thing. [Laughter]

Loren Feldman:
You guys are all freaks. Let’s be honest.

Jay Goltz:
For sure. But he’s an even bigger freak, because he actually is an artist who became a successful business communicator and marketing person. Those two things usually are not in the same—is that right, Shawn?

Shawn Busse:
Yeah, I know some other talking dogs.

Jay Goltz:
Do you know some other artists who went into marketing, who are actually—

Jaci Russo:
I would give my husband an example. He was a fine artist who’s gone into marketing. So it happens. But it’s very rare that, like Shawn, they can also run successful businesses without a business partner. That is a hard thing for them to do. Two different sides of the brain.

Jay Goltz:
Yeah.

Loren Feldman:
So just to tie this up, I think what I’m hearing from you is that, yeah, any business can be remarkable. And, you know, in preparation for this and thinking about it and thinking about the Purple Cow, it occurred to me, I think I would argue that the advice Seth Godin offers in Purple Cow is kind of generic advice. It’s not like before he wrote that book, the conventional wisdom in marketing was that the way to sell more stuff is to be exactly like all of your competitors. I guess I’m saying, I think the advice Godin is offering is kind of commodity advice. He just executed it really well with a compelling image of a purple cow. Am I wrong, Shawn?

Shawn Busse:
No, no, no, you’re wrong. I mean, what he did is he used metaphor, which is the powerful thing. And that’s not just an execution. He found a way to tell his story in a way that was new and different and unique. And I would also argue, you’re simplifying his position a little bit, in that he’s not saying, “Oh, differentiation is important.” That’s been said forever. He’s saying, “You have to be radically different.” He’s saying, “You have to really turn it up to 11.” And that idea, I think, was a bit new, in terms of his book. So I don’t think it’s just the execution. It’s more than that.

Jay Goltz:
I read the book written by somebody who worked at Nordstrom years ago. And she said something in it that was very smart. She said, “It’s not that Nordstrom is so good. It’s that everyone else is so bad.” And there’s truth to that. And my argument is: Being remarkable today means being really good.

Jaci Russo:
I think that in a capitalist society, the businesses that do their job better will typically rise to the top. And I think you’re seeing that. If you just want an example, we’ll look at what’s happening with fast food. All of these fast food restaurants raised their prices, raised their prices, raised their prices, and saw their sales drop. They all went back to $5 menus, and they’re starting to see that they’re gaining business back. So the market will dictate. Same thing with customer service. The companies that are saying, “I’ll get back to you in 48 hours,” they will be upped by a company that says 24 hours. And they will be upended by a company that says same day. So I think that consumers drive what we expect the businesses to do.

Shawn Busse:
I mean, the giant asterisk you’re not recognizing, Jaci, is monopoly and customer capture.

Jaci Russo:
Fair.

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