The Rule of 70

WORLD GDP is growing at 4% per year, how long will it take for world GDP to double?

Your company’s revenue is growing at 10% per month, how long will it take for your company’s revenue to double?

There is a simple rule of thumb that you can use to figure out roughly how long it will take for something to double, given an expected growth rate.

The Rule of 70

This rule of 70 can be described by the following equation:

If the world’s GDP is growing at 4% per year then global GDP will double in about 17 years.

If your company’s revenue is growing at 10% per month then revenues will double in about 7 months.

Target people’s forgotten needs

WE ALL know the old marketing adage, “sex sells”. The marketing approach is quite simple: link sex directly or indirectly with the product or service that you are selling. It may be a certain brand of cola that we end up buying, but it was sex that we were after.

Sex is a base level physiological need on Maslow’s hierarchy of needs. As a base level need, sex is a desire that people will seek to satisfy even if other low level needs such as employment, shelter or safety have not been met. Quite simply, sex appeals to us all.

Putting sex to one side, people also have higher level desires that we may want to appeal to. As we discovered in the previous post, there are three simple pleasures which people require for a life of happiness (whether they know it or not):

  1. Friendship: we want to belong to a community with which we can identify. We want to be cared for and cared about. We want to be missed when we are not around;
  2. Freedom: we want independence from the demands of others. We want control over our own lives and the ability to make our own decisions; and
  3. Thought: we want to understand the world and the nature of the challenges that we face. Understanding may not remove the challenges themselves, but it will help to remove the anxiety that often accompanies the confusion, displacement or surprise which result from our lack of understanding.

As the examples below demonstrate, marketing firms are well aware of the opportunities presented by being able to effectively target people’s forgotten needs.

1. Friendship

It may be a certain brand of alcoholic beverage that we end up buying, but it was friendship that we were after.

2. Freedom

It may be a certain brand of luxury car that we end up buying, but it was freedom from the demands of our daily lives that we were after.

3. Thought

It may be a certain brand of personal computer that we end up buying, but it was a desire to think differently and understand the world that we were after.

Pleasure is the goal of life

SEEMS fairly straight forward doesn’t it.

The purpose of life is the pursuit of pleasure, and the quest for those objects and experiences that will make our life more enjoyable.

As I recently discovered while reading “The Consolations of Philosophy” by Alain de Botton, this was exactly the philosophy held by Epicurus, an ancient Greek philosopher born on the island of Samos in 341 BC.

To summarise his philosophy in a single sentence, Epicurus believed that:

Pleasure is the beginning and the goal of a happy life.

What are the first images that spring to mind when you think of pleasure? You might think of a fast car, an opulent villa overlooking the ocean, or limitless money.

Imagine you had all three. Would you be happy? Maybe you would. However, it is possible to imagine that a fast car without a friend to show-it-off to would not make you happy, an opulent villa without the time to enjoy it would not make you happy, and limitless money accompanied by high levels of anxiety and no time to relax or contemplate the good life would also not make you happy.

Not every type of pleasure will lead to happiness (or be sufficient for happiness) in the same way that not every type of medicine will lead to good health.

If we assume that Epicurus is right, and that pleasure is indeed the goal of the happy life, then it would seem important to develop a clear understanding of the types of pleasure that will actually lead to happiness.

In his book, Alain de Botton outlines the three simple pleasures that we need to pursue and acquire if we are to enjoy a life of Epicurean happiness:

  1. Friendship;
  2. Freedom; and
  3. Thought.

Although sometimes difficult to acquire, it turns out that the three essential pleasures of life are goals that we can all afford to pursue.

Start a movement – stand up and dance

STAND up and dance like nobody’s watching. We are watching though, everyone is, and that’s why being the initiator feels so scary. You are afraid of looking like a fool, we all are. So we wait and watch you dance.

Genuine passion is contagious, and as you dance freely and passionately one person sees the genius in what you are doing and has the courage to join you.

Simple dancing, nothing fancy. You dance because you love to dance and you embrace your friend in the dance. We continue to watch you dance, the two of you. It is still a novelty and still too early and much too risky to join you.

You dance openly and eagerly and another person is infected by the brilliance of what you are doing and comes to join you.

You dance wildly and keenly and as passionately as ever, the energy levels race higher, the tension grows, and the attraction of the dance becomes so compelling that people are wonderfully and inescapably drawn towards the dance. A few people begin to walk and others start to run.

The movement has started.

12 Tips for Creating an Effective Pitch

An elevator pitch needs to be clear, concise, provide a solution and generate interest in order to just get the conversation started

AS WE discovered in the previous post, an elevator pitch is a high-level overview of whatever it is that you are selling and is designed to just get the conversation started (Elevator Pitch Essentials, Chris O’Leary).

As a high level overview, an elevator pitch will need to be kept fairly short and to the point.  The irony is that creating a short pitch is likely to be a fairly long process because you will have to decide what information your listeners need to hear and what are just details. To mis-quote Mark Twain:

I didn’t have time to write a short elevator pitch, so I wrote a long one instead.

There is a lot to think about when preparing an elevator pitch, so to speed up the process I have identified 12 tips for creating an effective pitch.

1. Structure and Content

  1. Be clear – you want people to understand. You need to explain your idea in a way that your mother would understand. You want your audience to do the least amount of work possible.
  2. Be concise – people are busy. Anecdotal evidence suggests that people’s attention starts to waiver after 30 seconds. An elevator pitch should be no longer than 60 seconds.  Too much information will scare people away. Give them just enough information, and make them want to know more.
  3. Provide a solution – people want you to solve their problems. Focus specifically on the problem that you are solving for your audience. If you merely provide a shopping list of skills or services you may leave your audience thinking “So what? How does that help me?” After you have presented the problem, provide an outline of your solution.
  4. Tailor your pitch – different people have different problems. A pitch should address the specific concerns of your audience.
  5. Be credible – who are you? why are you qualified to provide your solution? Explain why you are able to identify and solve the problem.
  6. Give the big picture – the details are confusing. People are unlikely to understand your idea in the same way that you do, so the details will confuse or bore them. Give a high-level overview of your idea.
  7. Be unique – there are many ideas competing for attention.  What makes your idea different?
  8. Set the hook – you need to generate interest. A hook is a statement designed to generate interest and make your audience want to know more. For example, “I am a consultant in the city” compared with “I am a McKinsey strategy consultant looking at the new media and high tech space. I’m currently looking at cloud computing and how it is changing the computer industry forever.” As a second example, borrowed from Anna Rose, the Australian Youth Climate Coalition has a very short elevator pitch: “The AYCC aims to build a generation wide movement to solve climate change before it is too late.”  The last 5 words are the hook, “before it’s too late”!
  9. Call to action – what do you want? An elevator pitch is not designed the close the deal, it is designed to just get the conversation started.  It would be a good idea however to decide what you would like to achieve out of the interaction. You can then give people an opportunity to help you by asking for what you want: a business card, honest feedback, a referral, legal advice, seed capital, an opportunity to give a full presentation.

2. Delivery

  1. Be prepared – people respond to confidence. First impressions are important and to deliver a strong performance you should practice and get feedback. Prepare answers to any tough questions that you may get in response to your pitch. You need to be comfortable enough to adapt to the conversation as it progresses.
  2. Be genuinely passionate – people tune out the ordinary. If you are genuinely passionate, people are likely to stop and listen. Investors normally expect passion from entrepreneurs as a pre-requisite, a good idea does not compensate for lack of passion.
  3. Have integrity – your story needs to ring true. You need to believe in your own story because the first step is to convince yourself, only then can you convince your audience. Avoid clichés and platitudes.