Social Media and Corned Beef Sandwiches

Corned beef sandwiches may not be the first thing you think of when you think of social media, but Manny's Deli in Chicago is an excellent example of a company that leverages it well.  I’ve chosen Manny’s for this post because 1) it is not Frito Lay, Dr. Pepper, etc, i.e. companies that you would normally expect to take advantage of social media; and 2) Manny’s makes the best corned beef sandwich in the world.  This is not up for debate.  I’m not going to attempt to describe what it’s like to eat a Manny’s corned beef sandwich because I lack the vocabulary of a food savant, but below are some pictures of people that you might know that think it’s great.

Ted Allen, from the Food Network, on the show the Best Thing I’ve Ever Ate. Ok, so I couldn’t find a picture of Ted Allen eating there, but he was on the show talking about it.  This is Manny's blog post about it.

President of the United States, Barack Obama

Close-up view of the sandwich

Before I continue, I think it is important to describe what the Manny’s environment is like.  Manny’s has been around since 1942 and is simply a no frills, pseudo-Kosher cafeteria with ample seating.  Everyone eats at Manny’s.  Chicago businesspeople and politicians, tour buses full of grandmas and grandpas, broke college students in ratty jeans, and US presidents.  When you go through the cafeteria line you always get greeted by this charismatic gentleman whose name escapes me at the moment.  He’s the one slicing your corned beef and he has a quirky way of treating people.  Senior citizens get the utmost respect and attention from him, good looking ladies bring out the flirt in him, and the young college guys (like I was back then), well you get a little insult: “What are you punks doing here again?,” or “Go get yourself a haircut.”  I know, not really endearing to most, but to a young college guy, it makes a little bit of sense.  It was like my dad yelling at me, who I missed, but he was 1100 miles away in Houston.

The reason I relate all this information to you is that the Manny’s experience, in addition to serving an amazing corned beef sandwich, is all about relationships.  Despite the hundreds of customers they get throughout the day, the staff there want to treat you as if you were family.  I believe that Manny’s Facebook page is an excellent vehicle for them to extend these relationships outside of the cafeteria.  Although Manny’s management probably didn’t read Groundswell and probably just thought of Facebook as some technology they should be on because everyone is on it, they inadvertently stumbled upon a relationship building gold mine with their Facebook page.  Below are some examples about what I’m talking about.

In general, most of the postings on the Manny’s page are in this vein.  This has a powerful effect on the people that area already loyal to Manny’s, but can you imagine the curiosity it would spark in people that may have stumbled upon the page through a friend’s page? 

I think what’s incredible about this page is that Manny’s isn’t really doing anything to curate the page other than posting the occasional event or celebrity guest visiting the cafeteria.  Groundswell speaks about the potentially adverse effects of a tool like Facebook.  Tons of people are on it all the time with the potential to post negative things on it.  However, you don’t see anything negative on the Manny’s page.  It’s a testament to the fact that social media is a tool to help augment relationships, not replace them.  The reason you don’t see anyone trashing Manny’s on their Facebook page is because they take of their customer where it matters – at the cafeteria.

Overall, I think social media tools like Facebook are something that can be utilized effectively by local businesses, more so than Frito Lay’s and Dr. Pepper’s of the world.  Local businesses tend to be relationship-based and thus a relationship-type technology is going to help them.  I don’t personally know the CEO of PepsiCo and eating a bag of Cheetos doesn’t make me think of home.  But I do get that marketers understand that they need to establish a personal relationship with their customers and I think some of the wiser ones get the relationship-based nature of the technologies and their potential.  Can they replicate the type of feelings when I go to Manny’s though? I don’t know. It hasn’t happened for me yet. 

Walmart: The Behemoth of a Catch 22

Given the enormous amount of data that Walmart captures, do you think they have been successful at converting into an experience that serves as a competitive advantage for them?

I think their data has definitely given them a competitive advantage. I think if you ask your average person what they think of Walmart, they'll tell you that it's "cheap." MBA students will generally say the same thing, but in fancier terms - Every Day Low Prices (EDLP). I feel that Walmart's customers truly value EDLP and the fact that they can get almost anything they want at EDLP. Walmart can't make this happen without its hoards of data.

Any MBA can tell you that the reason that Walmart can offer EDLP is because of its enormous bargaining power with suppliers. I don't think Walmart could have this bargaining power unless it knew exactly what its customers wanted. For example, maybe it could negotiate a massive discount for cheeseburger flavored Doritos (incidentally, these are really gross, in my opinion), but if it can't get them off its shelves, then what good does it do it? The bargaining power is useless unless the products it purchases are actually generating cash flows and it can't generate cash flows unless it knows exactly what the customer wants, hence the need for the data.

In addition to pinpointing customer wants, the data has also helped Walmart become a master of operational efficiency, which also supports the existence of EDLP. Walmart gains operational efficiencies via inventory. Knowing when certain products are needed and where they are at any given time helps Walmart free up its working capital by keeping low levels of inventory and it also helps it manage its shrinkage.

Lastly, in our strategy classes in the MBA program, we learn that sustainable competitive advantage often derives from having a quality that is difficult to imitate by your competitors. Walmart's obsession with data is definitely a quality that is difficult to imitate.

What do you think about the privacy issues associated with all of that data and the amount of personally identifiable data they are able to capture. Does it bother you? Do you trust them with it?

I really don't have any issues with Walmart collecting all this data. So what if they have my social security number? I mean, what exactly are they going to do with it? I think one thing that privacy watchdogs miss is that data, per se, is pretty much useless. If you study information theory, you'll learn that data is only useful if it's turned into information and information is only useful as the recipient because the recipient ultimately digests the information and turns it into knowledge. My social security number might give Walmart access to hoards of other data, but what good is it going to do them? It might be useful to them if it was somehow linked to the contents of my refrigerator and pantry.

I also think it's somewhat hypocritical to bash data hoarders like Walmart and yet reap the benefits from its efforts. I know people that won't shop at Walmart because of this privacy issue and many other reasons, but if you're truly worried about your privacy, Walmart isn't the only culprit.

Furthermore, in this age, if you're concerned about your privacy, then you might as well stop being a consumer. One could argue, especially if you're an affluent, well-educated individual (at least these are the individuals I always hear these arguments from), that it make sense to buy local, etc., but honestly, even a small business wants to get as much information as possible about it customers. I mean, why wouldn't it, why wouldn't it want to know exactly what its consumers want so it can generate revenue? Here's a Catch-22 for you: consumers want privacy, but they still have to consume. OK, so it's not immediately apparent why this is a Catch-22, but it is because as a consumer you must willingly reveal something about yourself so someone else can meet your needs.

Ok ok, I'll stop with the MBA pro-business at any cost rant. I do worry about my privacy, too. Not so much in the context described above, but I do worry about it getting into criminal hands, i.e.. people out to defraud you and take your identity. I feel that if we should be worried about anything is cyber security. But I'm an optimist and I feel that the cyber security technology evolves at a rapid pace just like any other technology. Honestly though, I don't wake up in the morning and think to myself: "Oh my, am I going to be cyber secure today?" Some people do though and thank goodness we have them in our society. Ultimately, the privacy watchdog groups and other worriers help implement reasonable policies and create the technologies that make us safe. I take back calling them hypocrites. I may find them annoying, but in the end, good things do come from them.

What aren't they doing with technology that they could; that is, are they using all of the technology that is available to them to capture insights and create great experiences for their customers and, if not, what could they do?

In my answer to the first question, I suggested that EDLP was the experience that Walmart is providing. Especially in these tough times, I'm sure this is an experience that is valued by many customers. Personally though, maybe because I am a little better off (even though I have no income now, in the future i'm hoping this MBA pays off), EDLP just doesn't do it for me. I think Walmart is ok, but one of the reasons that it doesn't get more of my business is that the experience shopping there just drains me. The thing that bothers me the most is how long the whole process takes. I mean, I'm ok with the fact that buying cheetos and buying an ironing board requires me to walk across a football field, but after I've walked around the store for an hour, I want to check out quickly! I usually spend about 15-20 minutes waiting in line at Walmart. And don't get me started on those self-checkout things, I hate those. I think the wait bothers me so much because my opportunity costs are so high. Time spent at Walmart means time not studying. Once I start working, it'll mean not charing clients X amount of minutes. Any savings I may have gotten through EDLP are totally negated by my opportunity costs.

I guess all the above was a long-winded way of saying that Walmart hasn't figured out how to use its technology to figure out how to make me happy. Walmart can figure out in real-time what's selling, but can they figure out how many lost sales it has incurred because customers don't want to wait in line for so long? Maybe they have collected this data and realized that the amount of checkout counters and people required to make the line shorter isn't really worth the cost of gaining business from more people like me. Maybe I'm just not their target demographic.

What are those things on your feet?!

If you haven't seen what the person in the picture is wearing, then be amazed to know that those are running shoes.  These are the Vibram FiveFingers and they are the latest craze in running, i.e. the minimalist running movement.

I've been running for six years now and have generally kept up with what's going on in the running industry with respect to products and services.  I got into running because I had a huge beer gut when I graduated from college and I decided that I should do something about it since I had a lot more time than I did as an undergrad.  I had the attitude of someone who discovered religion again when I started running so I devoted much effort to reading the gospel of Runner's World and visiting the temple of the local specialty running shop.

About two years ago, I read a book called Born to Run, which is about an tribe of Mexican Indians that run ultra distances (50 miles or so) in thin sandals (and slightly inebriated).  The central thesis of the book is that these Indians, the Raramuri, have the ability to do this because of the fact that they are effectively running barefoot.  Christopher McDougal, who wrote this book, is a wonderful writer and leaves you with the thought that "yes, highly cushioned shoes are evil and now I need to go run barefoot everyday."

I noticed a surge in people wearing FiveFingers after the book was published and a Runner's World article suggests that the book did help create a lot of buzz about the FiveFingers and minimalist running in general.  I was also living in Denver, an extremely health conscious city,  at the time the book was written so I saw a quicker adoption of this trend.

Curious about this new trend, I decided to give it a try. I didn't go out and purchase the FiveFingers. I still can't get over how they look and the 90 dollar price point just doesn't seem worth it to me, so I started running in the shoes pictured below.

These are Asics' Onitsuka Tigers.  They were popular in the 60s and 70s and the ones sold now are replicas and are definitely not marketed as running shoes.  It's marketed as a lifestyle shoe that any good hipster should have.  In full disclosure, I have four variations of these.

If it isn't apparent from the picture, these shoes have no support so running in them adheres to minimalist principles. I loved running in these and I still do.  I love the feel of the ground on my feet when running in them.  My foot strike response just feels more natural.  I'm not really doing it justice with my weak description here, but wearing these shoes for me is akin to that feeling people get when they put on a pair or really comfortable jeans.  

It was also really time for me to be running in minimalist shoes.  When I experimented with these shoes, I had been running for five years and logged something like 1500 miles the year before.  The reason I say it was "time" for me to run in shoes like this is because my running form changed so much.  When I was first running I was really pudgy and suffered from severe overpronation.  Basically, this means your ankles roll inward when you run and it causes loads of problems (shin splints, IT band issues).  The shoe I most frequently ran in when I was first started running is pictured below.

This is the Brooks Beast.  A very fitting name.  These shoes had a lot of cushioning and medial arch support that helped me reduce my overpronation. They were also ridiculously heavy.  Over time, I lost weight and I became much swifter.  My foot strike changed and running in this type of shoe started feeling really awkward.  I finally went to a running store and told them about my issues.  They observed me walking and running and told me that while I overpronate when I walk, I no longer really did when I ran.  They told me I could move on to something with a little less cushioning.

The moral of all this is that I eventually progressed to be a runner where I could deal with a minimalist shoe. At least, I think I did because I don't get any of the injuries that novice runners do when they go out and buy a pair of FiveFingers and think they can just jump right into it.  Furthermore, the running community hasn't come to a consensus on whether minimalist running is really good for you.  The Runner's World article I referenced pretty much makes it clear that there won't  be a consensus coming for a while, but the minimalist running trend is going to remain strong in the short-term, at least.

Given all this, the question I want to address in my paper is: "How are specialty running stores going to deal with this new trend?"

Let me give a little bit more context so the question becomes more meaningful.  For decades, the running shoe industry has evolved to give us extremely cushioned shoes with the belief that more cushioning prevents injury.  The industry figured out every possible foot strike for a runner and made shoes that would correct any irregularities.  Thus, the Brooks Beast I showed above was the solution to for the severe overpronator such as myself.

Furthermore, in the last blog topic we talked about customer experiences that were especially meaningful to us.  Another one that I've had and that is relevant to my paper topic is the experience of going to a good specialty running shop.  When you visit one of these places, the customer service is paramount.  You get measured and tested as if you were in a doctor's office.  You get to try on 10 different types of shoes and run around in them until you find one that is just perfect for you.  In general, the MO of a good specialty running store is stocking all types of shoes for all types of runners. The minimalist movement is the antithesis to the MO of the running store: You don't need all these different running shoes nor do you need to be doing all this measurement and testing, all you need to offer a few, simple running shoes.

In summary, my paper will discuss how specialty running shops are going to respond to this new trend if they aren't already.  I also want to address if this trend has any traction and figure out who really is the consumer for these shoes.  Is it the experienced runner like myself, the novice, or a combination of both?

Big Money, Big Stakes

I struggled writing this post because I think it’s been a while since I’ve had a meaningful customer experience.  Don’t get me wrong, I know I’ve had them, but given my current situation as a student, I’m not really purchasing anything other than food, textbooks, school supplies, and beer. 

In our core MBA marketing class, we learned about “high-involvement” products, i.e. products that require a lot of deliberation before purchase and are usually high-priced.  I feel these are the types are products that lend themselves to the holistic experience Schmitt emphasizes. I think customers seek holistic experiences from high involvement products because of their high prices.  From an economics perspective, this makes sense because when you decide to purchase a $3,000 road bike as a recent undergrad graduate with a $50,000 a year pre-tax salary, you are forgoing the opportunity to purchase $3,000 of other potentially important things.  In this particular context, I better damn well be getting a holistic experience from my road bike if it means I’m forgoing an awesome two-week trip to Europe so I can sit on an uncomfortable bike seat wearing funny-looking shorts.

On a side note, Harvard psychologist Daniel Gilbert, in his book Stumbling On Happiness, links happiness to ability to make a decision and not worry about the alternatives.  Thus, a generally happy person will purchase the $3,000 road bike and not think twice about his or her decision.  Unhappier people always think “what if,” what if there is something better out there?  So, which person are you?

I think marketers should always think about where their products lie on the involvement plane (my own phrase, patent pending) before they try to create a holistic customer experience.  For example, if you’re selling chewing gum, a low-involvement product, do you think you can really create a holistic experience?  I think it’s dangerous to assume that you can and I think that’s the problem with Schmitt’s approach.  I think what actually does happen is that companies focus on a few SEM’s but not all of them.  Thus, a marketing director at Wrigley should be focusing his or her resources on Sense and not so much on Think.

Anyway, back on topic. I had to write all of the above to think about the last holistic experience I’ve had.  I’m actually experiencing it right now, i.e. being a student in the MBA program.  It doesn’t get more high-involvement than this.  I gave up a high salary (relative to my peers) and took debt to be unemployed for two years all on a hunch that I would possibly learn something and have some kind of life improvement because of it.

As of today, I can definitely say that I’ve definitely learned a thing or two and I think the program has definitely set foundations for a positive impact on my life.  It’s done this because it really is giving me a holistic experience.

From the Sensory perspective, I just have to say it’s been overwhelmingly positive. I went to the University of Chicago as an undergraduate so using that as a reference point, the sensory experience here has been absolutely wonderful.  I no longer have to endure atom-stopping, sunshine-less winters and the brutal pace of the quarter system that created a “sink or swim” environment.  And wow, UT has nationally renowned sports teams.  Did you know that the University of Chicago had the first Heisman trophy winner?  That was back in 1919 when it was actually good at sports.  Also, how about Austin?  What an amazing city.  Maybe revealing too much here, but man, it’s much easier to get a date in this city than anywhere else I’ve lived.

On the emotional side, I think the school has served me well.  Some context: I turned down a full scholarship at another program to come here so the decision to come here was almost insurmountably emotional.  For the program to meet my emotional needs, I need the school to validate my decision in various ways.  Most importantly, I need to be surrounded by people that I like and I need classes that challenge me to the extent that they fundamentally change the way I think (incidentally, also tied to the THINK SEM).  For the former, McCombs admits incredible people and I have already made some friends I know I’ll have for life.  For the latter, wow, I’ve realized that business is extremely complex and I’m actually really confused about some aspects of it.  Personally, the fact that I am really confused and have so much fodder for thought demonstrates that the academics are top-rate.  I’m not here to memorize formulas.

With respect to Act, boy, does this program get you to act.  The program provides so many opportunities that you will overextend yourself.  The program office tells you that you shouldn't take on more than you can handle, but they probably just say this because they don't want to get sued for sending you to the hospital after passing out from exhaustion.  I think the program office secretly knows that trying to do it all is a part of the MBA experience.  As I type this now, I have to meet with a team for a healthcare case competition that I got roped into at the last minute.  I’m probably not going to sleep until 4 am today and there’s a chance I may miss my 8 am class. Eek!

Lastly, on Relate, I feel that it’s my professors that do an excellent job of this.  One goal I have is to get a better sense of what it means to be a manager.  So I always appreciate that my professors always preface statements with “As a manager, you should think about this.”  I feel that the program office and my own peers lose sight of this.  The program office is overly career-centric.  Justifiably so, rankings and whatnot matter.  And of course, my classmates and myself included need to get jobs, but I just hope that people don't forget the whole point of a Master’s in Business Administration to learn how to do business administration.  You're not going to be an Excel jockey your entire career.  At least I hope not.

In conclusion, excellent job McCombs School of Business for providing me with a holistic customer experience.

How to take my money

A few years ago I was having a conversation with a friend of mine about something related to economics and consumer behavior.  I don’t really remember the particular details of it, but I remember one of her conclusions was “you guys are evil,” mainly referring to the ability of marketers and advertisers to hone in on customers’ preferences and (according to her) make them buy things they don’t really need.  Of course, I couldn’t really sympathize with her (aside from the fact that I’m an MBA)  because I love the fact that marketers and advertisers can sell me something that seems that it was made just for me.  However, at that time, I was completely unaware of personas or any other techniques used to figure out customers.  Now that I am armed with some of this knowledge, I wonder if I explained these techniques to my friend today if she would find marketers and advertisers even more evil.

Ok, let me get back on track because this post isn’t about my musings about what my friend thinks.  So I reviewed the cohort vignettes to see which one really captured me.  I couldn’t help and chuckle when I saw how miserably they failed in doing so.  Fine, maybe I’m saying this because of an unconscious desire to want to feel so unique and special that a silly bullet-point description and a pencil sketch couldn’t possibly capture my true essence.  But hey, my horoscope does an excellent job so why can’t these things?

Anyway, I’ll give it a go with the empathy map and figure out a way to get those marketers to sell stuff to me. 

One – What do you think and feel?

I think about Nietzsche, Hayek, Marx, and profound philosophical questions . . . just kidding, I don’t think about these things at all.

I don’t have a complicated answer to this, I think about my family and friends most of the time.  They’re “what really counts.”  Because of this, my “major preoccupations” and “worries and aspirations” mainly revolve around them.  I always want to make sure I maintain good relationships with my friends and family because without them, I’d be lost.

Two – What do you see?

I see way too much stress in my environment as an MBA student.  Jobs and grades.  That’s all everyone seems to care about.  Did my classmates forget they’re on a two-year vacation from the daily corporate grind?  I did five years of it and I’m not rushing to go back.  Plus, how about all the awesome learning we’re doing?

Something funny about my environment though is the preponderance of undergrads.  I went to a small private school as an undergrad so it’s amazing to see the volume of people at this enormous university.  Wow, was I that young-looking once?

But hey, thank goodness for my friends though.  They’re always chill despite the overflowing stress levels.  That’s why they’re my friends in the first place.

So now I have to say something about what the market offers? I don’t know.  iPads, Kindles, Lady Gaga, Cee Lo Green – this is what the kids like these days, right?  However, what I do know is that I love the beer section at Whole Foods.  Sierra Nevada just released a new beer in the style of barley wine. And when I don’t want beer, there’s always an Old-Fashioned, a simple, classic, all-American drink.

Three – What do you say and do?

Last week we had a mobile telecommunications company come to campus and present to us about how amazing the company is. In the Q&A session, I asked the presenter a tough question about content development for phones and asked him how they planned to innovate in this area.  I got a defensive pseudo-answer from him and definitely was not invited to interview.  Tough loss for them, but then again, I’m not interested in working for a company that can’t give me a frank and honest answer.

Frank and honest.  This is how I carry myself in public. I may not have the greatest social tact, but at least you’ll know what I’m thinking.

Appearance wise, I dress like a hipster sometimes.  I don’t see anything wrong with this. I love my black, thick-rimmed glasses.

My behavior toward others is consistent.  People deserve respect so I try my hardest to give it to them.  Sometimes I come off as brusque when interacting with others.  Again, this is mainly attributable to being frank and honest, but I do realize when I act like this and I’m always working to improve.

Four – What do you hear?

Tying to the theme above, my friends always tell me they appreciate my honesty.  They also like to confide in me because I listen and don’t gossip about them. Also, I may not give great advice, but that fact that I just sit and listen is enough for them.

My bosses appreciate that I can make sense of large amounts of information.  They also really appreciate that I take time to develop the people below me.  They don’t appreciate that I’m terrible at my administrative duties.  No, I don’t want to make a client file and why do I need to send out that invoice?  We need to hire a billing manager.  My time is better served actually serving clients.

And what do my influencers say? I don’t know who my “influencers” are supposed to be in this context.  I’m going to say my parents though and they’ll tell you to “watch out.”

Five – What are your pain points?

Fears? I’m going to be one of those people and say that I don’t really have any.

Frustrations?  I have plenty of these.  Overall though, I get frustrated with being forced to do administrative things or follow policies and procedures that impede my ability to do the things I really want.

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Obstacles? Hierarchy, especially in the workplace.  I always find myself butting heads with people who live and breathe hierarchy.  For my generation, hierarchy is irrelevant.

Six – What do you hope to gain?

Man still has to toil for his food, unfortunately, well at least I do, but at least it’s behind a computer screen and not in a field. Aside from my need for eating delicious snacks, I would be content not doing much of anything. I like to read a lot and take nap in public parks, but again, there’s the whole feeding myself issue that requires labor and precludes me from doing so on a regular basis.

With respect to measuring success, I feel only people in Western culture are people obsessed with doing so.  All I can tell you is that I’m already pretty successful. I have family and friends that love me so that’s all I really need.  So I guess the only real obstacle in the way of having my family and friends love me is my own self.  Wow, I better not mess up.

Now that I’ve figured myself out, this is what my persona would be.

Juan, single, easy-going male

Meet Juan.  He left his high-paying corporate job to become a zero-income graduate student.  No worries though, he’s probably going to leave graduate school and become a successful entrepreneur.  If things don’t work out, that’s ok because corporate America already has a job ready for him.  He’s both his boss’ darling and worst nightmare.  Clients love him, but HR is always on his back for not completing his compliance training.

Juan has a standing brunch date with his parents every Saturday.  He never misses unless he’s travelling to Brussels to negotiate a contract for the small beer importation business he runs on the side.

Juan a sneaker-phile and has a pair to match any of the vintage t-shirts he may be wearing.  The sneakers he’s wearing today are one-of-a-kind because they were never sold at stores.  His friend who is a designer at New Balance always sends him prototypes.  The vintage shirt is vintage by virtue of being one he’s had since middle school.

The only way to get Juan’s loyalty to establish a relationship with him.  How is your product or service offering going to do that?