Skip to main content

What you don't Know you don't Know

I promised that I would try to give some practical advice on how to improve your business in simple to understand concepts and ideas. One of the most pressings issues for any company is how to increase sales profitably with the least amount of effort, or something I call 'Return on Effort.' Most people believe that the best way to grow a company is to either get your existing customers to purchase more or to get them to tell their friends and acquaintances to purchase from you. While repeat business is much easier the get than new business, and referrals can help you grow, you are at best looking at incremental gains. It is like fishing in the same pond trying to catch different fish. What most companies would like are macromental gains and in sales and profits. In order to get to the lofty goals, you are going to have to abandon some old held beliefs, and move far enough away from the safe harbor so as to no longer see the shore.

First, I have to diagram what I am talking about (click on image above). Draw four progressively larger, concentric circles, with the smallest being “What you know you know,” the next largest titled “What you don’t know you know,” the third largest “What you know you don’t know,” and the last being much, much larger circle titled “What you don’t know you don’t know.” If you look at the diagram, you will notice what we know, either as an individual or company, is pretty small in comparison to the infinitely large what we do not know we do not know.  Even with "big data" we still now know what we do not know, which is a start.

Most companies and individuals like to operate in the sphere of what they know they already know. They conduct surveys with customers they already have to see how they the purchase and discover their likes and dislikes. Essentially, this type of market research just reinforces the beliefs (be they right or wrong) you have come to accept as truths about the types of customers you should be selling to. This is similar to driving looking in the rear-view mirror.

A few brave individuals will try to expand their horizons and knowledge (and customer base) by venturing to discover what might be in “adjacent ponds” and discover what they once knew and have forgotten or what they know but have not yet realized. They will do a little research of customers who look very much like the customers they have now, or whom they think should like their product or service.

The hardest thing you will ever do is to take that step into the unknown, but in order to really make any type of impact, that is exactly where you have to go. I cannot imagine what would have happened (or failed to happened), if the founders of this country (Adams, Washington, Madison, Franklin, Jefferson, Payne, Lafayette, etc.), had NOT taken that first fateful step. They ventured into the space of “what they did not know what they did not know.”

Closer to home, I look at a few notables: Apple and Microsoft to name a few. What is interesting is that both of these companies MISSED the Internet revolution when access the world wide web was virtually an unknown entity! During the time that the Internet went from being just an oddity to a mainstream event, Mac lost 50% of its market share, and Netscape became the darling of the industry. To give Microsoft credit, they did regroup rapidly to put out a browser to compete with Netscape, and actually due to their leverage already in the PC market, was able to muscle out Netscape. Incredibly, Microsoft missed out again with open sourced software when Linux came to the fore. Again, this was something Microsoft did not know what they did not know, and instead choose to ignore it.

To Apple’s credit, they did jump out into the unknown with the iPod / iTunes. They did NOT know that iTunes would be such a hit (it now accounted for 80% of their 2010 stock valuation). It is sort of amazing to see Apple move (almost over night) from a failing PC manufacturer, to the leader in the digital media world. They accounted for 25% of ALL music sales worldwide in the last 3 years. Essentially, they began to operate in a industry the did not know. Credit to the late Steve Jobs, here doubled down with the iPhone, essentially once again going where he did not know what he did not know, mobile phones.

If you look at the most successful companies that have emerged from the advent of the Internet they have been companies that created something that no market data could have shown them: eBay, craigslist, PayPal, Amazon, Facebook, and Twitter.  They essentially went where no one had gone before, and reaped the benefits of getting unknown customers.  

Bottom line is: Go to where you do not know what you do not know. That is where you will find all your opportunities.

Comments

Popular posts from this blog

Myers-Briggs and Social Media

If you have been working for any amount of time, you have most likely have taken the Myer-Briggs personality indicators (introvert v. extrovert; sensing v. intuition; thinking v feeling; and perceiving v. judging).  Here is an infographic created my mbti that has been broken into five sections.  It is pretty informative and goes on to show what types of indicators prefer which types of social media.
Myers-Briggs Type

The about graphic describes the various characteristics of the Myers-Briggs personality types and how they would be inclined to use social media. There are 4 types that can combined to create 16 "personalities." To enlarge picture, just click on the image.
 Do You Use Facebook
This is an graphic on how your particular personality type would use Facebook. It seems like extraverts and intuitive individuals prefer using Facebook.
Social Media Use at Work
This graphic explores how different types use social media and the web at work and their predisposition to share i…

Puns a Plenty

This post is near and dear to my heart…puns! Below are some situations that we are really familiar with, but whose outcomes may make your grown! Please, please, please realize this is NOT for the faint of heart, but should bring you a chuckle no matter what day it is or where you are. ________________________________________ King Ozymandias of Assyria was running low on cash after years of war with the Hittites. His last great possession was the Star of the Euphrates , the most valuable diamond in the ancient world. Desperate, he went to Croesus, the pawnbroker, to ask for a loan. Croesus said, "I'll give you 100,000 dinars for it." "But I paid a million dinars for it," the King protested. "Don't you know who I am? I am the king!" Croesus replied, "When you wish to pawn a Star, makes no difference who you are."
A mechanic once owned a dog named Mace. Mace had a bad habit of eating all the grass in the mechanic's lawn, so the m…

Lupercalia and St. Valentine's Day

OK, I just could not resist this: Romance, sex, orgies, wolves, and martyrdom all under one legend. Oh my, what a day we have!!! We might celebrate romance and sweethearts on this day, but boy, the Romans really knew how to party. While history is fun, it is also interesting to know how some things never change (like falling in love and celebrating it!). Happy St. Valentine’s and Lupercalia. May you celebrate it at your heart’s content with someone who has stolen or whom you have given your heart away!  Lupercalia is uniquely Roman. It harkens back to the days when Rome was nothing more than a few shepherds living on a hill known as Palantine and was surrounded by wilderness teeming with wolves. The name comes from lupus, or the latin form of wolf, that celebrates the founding of Rome by Romulus and Remus (as they were suckled by a she-wolf). 
Another thought is that Lupercus, protector of flocks against wolves, is a likely candidate for the name. In any case, there is no question abou…