Business Leader has taken every care to make sure that content is accurate on the date of publication. The views expressed in the articles reflect the author’s opinions and do not necessarily reflect the views of the publisher or editor. This commentary is provided for general informational purposes only and does not constitute financial, investment, tax, legal or accounting advice
Editor’s Letter
Some of the greatest business leaders of modern times said you shouldn’t listen to customers when looking to innovate or develop your product. Or at least that is what you have been led to believe.
“It’s really hard to design products by focus groups,” Steve Jobs reportedly said. “A lot of times, people don’t know what they want until you show it to them.” It was Henry Ford who supposedly claimed: “If I had asked people what they wanted, they would have said faster horses.”
These two quotes have been used to question the importance of consumer insight and the power of a genius to transform a business.
But it is rubbish. For a start, there is a doubt about whether Ford even said those words. He undoubtedly seems to have shared the sentiment of the quote and doubted the importance of asking customers what they want. But this actually caused Ford problems in the 1920s when rival car makers such as General Motors started offering vehicles with innovations designed to meet people’s needs, such a greater range of
colours. The message in GM’s advertising couldn’t have been any different to the sentiment of Ford’s quote: “A car for every purse and purpose,” it boasted.
As for Jobs, it is worth considering the context of his quote. It is from a 1996 interview with BusinessWeek in which he was asked: “Did you do consumer research on the iMac when you were developing it?” This was Jobs’ full response: “No. We have a lot of customers, and we have a lot of research into our installed base. We also watch industry trends pretty carefully. But in the end, for something this complicated, it’s really hard to design products by focus groups. A lot of times, people don’t know what they want until you show it to them. That’s why a lot of people at Apple get paid a lot of money, because they’re supposed to be on top of these things.”
As you can see, that quote is far more nuanced than the extract I started with. What Jobs actually seems to be implying is that it was up to Apple to interpret consumer research, not that it is useless. This is a crucial distinction.
This edition of Business Leader looks at how to understand the modern consumer and the importance of doing so. You will find case studies about the companies that have understood and mastered the needs of consumers and built fast-growing, profitable businesses on the back of it. You will also find masterclasses on market research, marketing and how to be creative.
On top of all that, you will discover ideas, expertise and inspiration from our Business Leader Experts as well as a list of the couples who have built successful ventures together. I hope you enjoy the issue. Thank you for your support of Business Leader and please get in touch with any questions, feedback or ideas concerning the issues at graham.ruddick@ businessleader.co.uk
Editor-in-chief Graham Ruddick
Experts
Tom Beahon co-founded Castore with his younger brother Phil in 2015 after failing to become a professional footballer. He has since built the sportswear brand, which is based in Manchester into a company worth almost £1bn.
Catherine Baker is the founder and director of Sport and Beyond, which applies techniques proven in sport to the business world. She is the author of the book Staying the Distance, vice-chair of the Dame Kelly Holmes Trust and chair of the consultancy O Shaped.
Zara Nanu is an expert on workplace gender equality and fair pay, having started her career campaigning for women’s rights. As a serial entrepreneur, she is currently founder at WorkVue and a member of the women’s leadership board at Harvard Kennedy School.
Emma Jones launched Enterprise Nation in 2006 after she founded, grew and sold her business Techlocate. She has since helped thousands of people start and expand their businesses. Jones was also one of the 18 cofounders of StartUp Britain.
Steven Swinford joined The Times as deputy political editor in 2019, becoming political editor in 2021. He has previously worked at The Daily Telegraph and been shortlisted for political reporter of the year at the National Press Awards three times.
Caspar Lee rose to prominence with his popular YouTube channel, which had more than 6 million subscribers. He has used that experience to start several companies including influencer marketing platform Influencer and the investment fund Creator Ventures.
Niki TurnerHarding is senior vice-president and country head for the UK and Ireland at the recruitment firm Adecco. She started out in the recruitment industry in her 20s and now manages a team of 1,400 staff and oversees £1.2bn in revenue.
FEATURE CONTRIBUTORS:
Jake Humphrey is co-host of the High Performance podcast, which explores the secrets behind successful athletes, coaches and business leaders. He cofounded the TV production company Whisper and was a TV presenter.
Ed Smith is a former professional cricketer who was national selector for the England men’s team from 2018 to 2021. He is currently director of the Institute of Sports Humanities. He is a prominent thinker on decision-making, sport, leadership, as well as an author.
Ping Chan is economics editor at The Telegraph. A journalist for almost 20 years, she has previously written about economics, finance and business at the BBC and The Motley Fool. She is an expert on the UK economy and its impact on businesses.
Szu
Robert Watts, Ellen Hammett, Chris Maguire, Andrew Lynch, Bruce Whitfield, Pavlo Phitidis
MATRIMONEY
The companies that have given a whole new meaning to the term ‘power couples’
ROBERT WATTS
What if your business partner and your life partner were
the same person? It’s an idea that might sound like a dream to some but a nightmare to others.
For the former, they imagine all that extra time working alongside the person they love and trust, and building a business together. “At last,” they might think, “here’s someone who truly understands all those work frustrations.”
For the latter, teaming up with their other half to run a business is a recipe for disaster. It’s not simply that discussing HR policies or how to optimise negotiations with suppliers doesn’t make for great pillow talk. What if the day job crowds out your relationship? What if the multiple challenges, or even arguments, at the office spill into home life?
Even if your relationship is strong, it will not be easy to make
sure you switch off when you live under the same roof.
And what about worst-case scenarios? If your venture goes under, you may both find yourselves out of work. Or if your relationship breaks up, what does that mean for your company, your employees and your customers?
Two halves in one business can make for a whole lot of trouble, but there are many couples who have made it work and had great success in doing so.
We profile a dozen couples who have built companies worth at least £125m. Their joint endeavours range from oil trading to children’s fashion, luxury hotels to eco-friendly cosmetics.
Many clearly delineate their roles. For example, when the Hoyles were building up the highstreet retailer Card Factory, Janet was all about the product, while her husband Dean oversaw the financial and property side of the Wakefield-based group.
The same was true of the Kemps – a power couple of the boutique hotel world. Tim handles the real-estate deals and development opportunities that helped to build a transatlantic collection of eight hotels. His wife Kit, meanwhile, is all about the look and feel of the premises, helping to cultivate repeat business from guests and a strong following among celebrities such as Daniel Craig and Halle Berry.
These may be the most financially successful couples our research found, but there are countless others who have had success. And while this list features husband and wife teams, many thousands of businesses have been built by same-sex couples and those happy in long-term relationships without getting married.
If you have begun searching for someone to start a new venture with, bear in mind there might be a partner very close at hand.
METHODOLOGY
Valuations of public companies were derived from stock market prices at the start of August 2024. Many private companies were valued on a multiple of their annual profits or in a small number of cases on their net assets. We have also included private businesses where an enterprise value has been made public after a recent fundraising or sale.
1=
Dame Mary and Doug Perkins Specsavers
Valuation: £1.6bn
The Perkins founded Specsavers in 1984 and the company remains family-owned, based in Guernsey. There are more than 1,000 optician shops in the Specsavers chain, operating in 11 countries, with annual revenues of £4bn.
Doug is co-chief executive and chairman, while wife Mary focuses on customer service. The pair met while studying optometry at Cardiff University in the 1960s. On graduation, they moved to Bristol and set up their first business together, called Bebbington and Perkins, in 1967. They grew
it to a chain of 23 shops before selling the company in 1980. They returned to the optometry sector after Margaret Thatcher deregulated the industry in the early 1980s, sensing an opportunity – and Specsavers was born.
The Specsavers chain is run on a partnership model, where each shop is a joint venture with a local optician or health professional. The company now has stores in Sweden, Norway, Denmark, Finland, Spain, Canada, Australia and New Zealand. Australia is its biggest market after the UK.
1=
Sanjeev and Arani Kumar Soosaipillai Prax Group
Valuation: £1.6bn
The Soosaipillais were in their late 20s and living in a £65,000 maisonette in the soporific Surrey town of Weybridge when they launched what would become a global fuel trading giant with annual revenues exceeding £8bn a year.
The pair studied accountancy together at the University of Kent in Canterbury (an institution not known for billionaire alumni). Starting out with a pair of petrol stations and an oil storage site in London, they have knitted together a diverse energy group employing 1,450 people with offices in Antwerp, Houston and Singapore.
Prax Group initially began blending diesel, before it moved into supplying gas, oil, petrol as well as kerosene for aeroplanes. It then landed a contract to run service stations for Shell and Total, and hundreds of forecourts now sit within the group.
In 2021, the Soosaipillais bought the Lindsey Oil Refinery in Lincolnshire – now, one of Britain’s most important refineries. The acquisition tripled Prax Group’s turnover at a stroke.
Sanjeev Kumar, 51, is chairman and chief executive, while Arani, also 51, oversees the policymaking processes, planning and human resources.
Andrew and Linda Leaver Clinigen
Valuation: £1.2bn
Clinigen does not develop pharmaceuticals itself, instead acquiring the rights to medicines already created by drug developers. It then contracts producers to make and distribute them around the world.
The Burton-on-Trent business also provides a range of services to pharmaceutical companies, including running clinical trials. Andrew, 61, was already a veteran of the industry when he and his wife Linda, also 61, set up Clinigen in 2010. Andrew led the business while Linda ran
the marketing and PR functions, also serving as a director and owning a large chunk of the company’s shares. The pair had worked together before at another healthcare company, ADL.
The Leavers banked around £37m when they decided to float Clinigen on the London stock market in 2012.
Nine years later the operation was sold for £1.2bn. Since then, the couple have invested in a clinical trials firm, a healthcare outsourcing group and a chain of fish and chip shops.
Tim and Kit Kemp
Firmdale Hotels
Valuation: £620m
The Kemps head up a transatlantic portfolio of 11 boutique hotels. They opened their first, the Dorset Square Hotel, in 1985 and have since created luxurious enclaves from disused car parks and former warehouses.
Tim focuses on the property and financing side, while Kit is the design director. She initially ran her part of the business from a cupboard in her husband’s office, which soon took over a whole building in Kensington.
“When we opened our first hotels, we hardly had time to speak to one another for several months at a time,” she has said.
The group now has eight London hotels, including premises in Soho, Knightsbridge and Covent Garden. Firmdale also has three more hotels in New York, workspaces, as well as a glamorous retreat on the west coast of Barbados. Firmdale’s balance sheet shows net assets of more than £620m.
Valuation: £500m 5
Jonathan and Susie Seaton
Twinkl
When Susie, 42, found it hard to buy decent teaching resources for the nursery school where she worked, her and husband Jonathan began putting together their own in the back bedroom of their Sheffield home in 2010.
The early years of their education venture Twinkl were hardly child’s play. Jonathan, 41, would often rise at 4am to assemble content for the company, then do a full day’s work as a solicitor, before putting in yet more hours
in the evening making factsheets, posters and other products for the fledgling business.
Twinkl now offers more than a million resources for schoolchildren, from lesson plans and assessments to augmented reality video games. Annual profits have climbed to £29.7m and the Seatons have created jobs for nearly 1,200 people. The sale of a stake to a private equity firm last year valued the Sheffield-based business at £500m.
6
Sheila and Rod Flavell FDM
Valuation: £459m
Sheila met her future husband while dropping off her children at the school gates. Rod had already launched the IT contractor that would in time become FDM and offered her a job. She accepted, but later quit because Rod’s start-up had scant money to pay salaries and she needed a “proper job”.
A few years later Rod gave her a call again. FDM had grown and, Rod said, “needed its mother back”. Sheila accepted,
negotiating a proper contract, and a company car.
The pair later married and have grown FDM into a global IT and business services group with 18 centres across Europe, North America and Asia.
Rod, 66, remains chief executive, while Sheila, 68, is chief operating officer. They floated the group on the London stock market 10 years ago and the shares currently value the business at £459m.
Dean and Janet Hoyle Card Factory
Valuation: £416m
Born into a family of miners and textiles workers, Dean left school without a single qualification (a fixation with football was partly to blame).
In the mid-1990s he started selling greetings cards from the back of a van in his native Wakefield. By 1997, he and his wife Janet were ready to open their first shop and Card Factory was born.
While Dean, now 57, was credited as the group’s main commercial brain, Janet, also 57, was in charge of the design team and was considered the dominant creative force.
Ayman Rahman and Fateha Begum
Dare International
Valuation: £400m
Ayman’s parents wanted him to become a doctor, but he opted to become a City trader instead. Four years after dealing with the world’s energy markets, he joined forces with his wife Fateha, 36, to launch Dare International in 2016.
Today, the London-based operation now employs 200 staff and handles trades worth billions of pounds a day.
“My motivation, I think, comes from insecurity,” Ayman, 33, has said. “A desire to want to prove
yourself to yourself and to others… I grew up as a Muslim guy in the wake of 9/11 in a town which had hardly any people of colour and very few Muslims.
“Going to school after 2001 you feel that sense that you are not part of the real community. I’d like to show that I can really contribute and be a part of this great country.”
The company reported annual sales of £269.1m last year, 12 times more than two years before.
During a 10-year period, the couple opened, on average, one new shop a week. They carefully ensured they kept their prices as low as possible and astutely filled the void created by the collapse of Woolworths and Celebrations.
The Hoyles floated Card Factory on the stock market and the shares currently value the West Yorkshire-based group at £416m.
Their earnings from the business provided Dean with the funds to indulge his passion for football. After 15 years of owning Huddersfield Town, he recently agreed to sell the club.
photo: Getty Images
Mark and Mo Constantine Lush
Valuation: £350m
Former legal secretary Mo, 71, invented the bath bomb in the late 1980s, taking inspiration from the fizzing properties of the hangover cure and pain reliever, Alka-Seltzer.
A few years later she and her husband Mark co-founded Lush, the eco-friendly cosmetics brand. A hairdresser in his youth, Mark has attributed his relentless drive to his “entrepreneur’s wound” –his father abandoned him when he was a baby.
That wouldn’t be the only traumatic event of his childhood. By the age of 16 he was homeless and living in a tent pitched in
Graeme and Yvonne Brooks Avtrade
Valuation: £400m
Avtrade keeps thousands of planes in the world’s skies each year. Headquartered 20 minutes from Gatwick airport in west Sussex, the operation provides components and repairs to more than 800 airlines. It typically despatches more than 6,000 parts a month, and the group also helps carriers lease, sell, loan and exchange aircraft. Graeme, 70, started Avtrade in 1985, initially trading the propellers of Boeing 737s. His wife Yvonne, 69, is the only other
director, and the couple still own all the £400m business. Since its inception, Avtrade has opened offices in Dubai, Singapore, Kuala Lumpur, Miami and the Chinese city of Guangzhou. The venture is now believed to be the world’s largest independent aviation component services provider and has grown its workforce to more than 300.
Turnover has climbed by almost 50 per cent to £261m during the past year. There were also record profits of £54.9m.
woodland. The Constantines would meet at about this time, although Mo insists Mark initially tried to “chat up” her sister.
Lush began on Poole High Street in 1995. There are now more than 850 shops across 51 countries selling handmade cosmetics including soaps, lotions and its bath bombs. Annual turnover exceeds £700m and Lush reports that it contributed £42.8m of tax last year.
After a lengthy search Mark, now 72, was finally reunited with the parent he had never known. His father died just two months later.
photo: Lush
Kelly Choi and Jérôme Castaing
Sushi Daily
Valuation: £300m
One of six children, Kelly lost two brothers to malnutrition while growing up in impoverished rural South Korea. At the age of 15 she moved to Seoul to work in the fashion industry after her father claimed a secondary school education was not suitable for girls.
While living in Paris during her 20s Choi set up a communication business that later collapsed with debts of more than €1m. For a while she contemplated ending her own life.
Realising this would dismay her mother, Kelly decided to start another business and teamed
12 11
up with her French husband, Jérôme. This venture was Sushi Daily – the Japanese-themed food kiosks now found in hundreds of supermarkets, railway stations and high streets.
The first site opened in the Lyon, France, in 2010. The London-based chain now has more than 1,000 outlets across Europe, Mexico and Dubai. Kelly and Jérôme, both 56, have also launched other Asian-themed restaurants and food brands, including Bam Tuk, Korma Kitchen and Tuk Tuk. Annual revenues exceed £400m.
Dan and Melanie Marsden
Lounge Underwear
Valuation: £150m
The Marsdens met at primary school at the age of eight but did not become an item until they were 16. In their mid-20s they launched Lounge Underwear, an online lingerie retailer. Its reverse-engineered business model involved launching an Instagram page and hiring influencers to promote a product that it would then sell straight to consumers from a website.
For the strategy to work, the merchandise had to be cheap to transport and store, as well as attractive to promote on social
media. Lingerie was the first product that fitted the Marsdens’ plan and they launched the company with just £1,000 of savings.
While Dan, 33, concentrates on strategy, business growth and finance tasks, Melanie, 32, focuses on nurturing a community of Instagram followers that has grown to more than 3.5 million.
Lounge Underwear’s turnover quadrupled during the pandemic, and while sales have been lower since the lockdowns ended, the Solihull-based group is still worth around £150m.
photo:
Sushi Daily
STEVEN SWINFORD ON POLITICS
Expect a frenetic autumn as Labour gets set for three game-changing events
Radical reforms to workers’ rights, a rousing party conference and a tax-raising Budget will dominate
In Downing Street, preparations are well underway for what will be a turbulent autumn as Sir Keir Starmer readies himself for three set-piece events for the new government.
Matters will come thick and fast. Already, Labour has unveiled the biggest overhaul of workers’ rights for a generation as it introduces an array of new protections with far-reaching implications for many businesses.
Ministers will then head to the party conference in Liverpool, which will be thrumming with more business leaders than the party has seen in decades. As is always the case in politics, money tends to follow in the wake of power, especially given that Starmer is wielding a 167-seat majority.
Autumn will culminate with the Budget on October 30, which the chancellor Rachel Reeves hopes will frame the economic and political narrative for years to come. Tax rises, spending cuts and welfare reform are all on the table in what could prove to be an explosive fiscal event.
Starmer’s view is that there is little time to waste, especially given that the start of his premiership has been
severely disrupted by the election being held so close to summer recess. Labour had barely taken the reins of power when MPs left, while widespread riots across the UK further disrupted Starmer’s early plans in office.
With MPs having returned on September 2, Labour’s workers’ rights package –known as the new deal for working people – is top of the agenda. Its potential scale and reach are huge: a right to disconnect for employees, a ban on exploitative zerohours contracts, protection against unfair dismissal from day one, a ban on fire-andrehire... the list goes on.
When the package was first announced it was met with significant concern from employers, who feared both the regulatory burden and increased cost. Labour has since gone out of its way to reassure businesses and watered down several of the key measures, but the concerns and questions remain.
Take the right to disconnect. The government will legislate to require companies to produce a code of conduct giving staff the right not to work outside their normal hours. The code itself is not expected to be legally binding, but employment lawyers have
already pointed out that it could lead to a rise in disputes.
Could sending an email after 6pm result in claims of unfair treatment? How should companies judge “routine” working hours? Will all businesses, large and small, have to keep a record of the exact working hours of employees so they can define what their routine working patterns are? Labour is emphasising that it is not an unmitigated right and that flexibilities will be built in, but the devil will be in the detail.
The day-one rights for employees also have the potential to be contentious. Labour will scrap the current “two-year rule” that stops people from claiming unfair dismissal during the first two years of their employment. Employees will also be entitled to sick leave and parental leave from day one, after they have passed probation.
Labour says the reforms are “fundamental” to its push for economic growth. Giving workers greater job security will ultimately encourage people to switch jobs, which in turn will boost productivity. But employers fear that they will be on the receiving end of a wave of litigation.
The annual conference will be a moment of celebration.
Tax rises, cuts to spending and welfare reform are all on the table in what could be an explosive Budget
“It’s about the party coming together and marking the fact we had a successful general election for the first time in 14 years,” one senior Labour figure said. It is likely to be light on new policy and instead focus on trashing the Tories’ legacy and hammering home the party’s message that it wants to go for growth.
The centrepiece this autumn will be Reeves’ inaugural Budget, which is going under the working title of “a Budget to fix the foundations”. Labour is now saying publicly what it has been saying in private for some time: that there will be tax rises above and beyond those set out in the manifesto. Reeves has done her best to set the stage, claiming that the Tories have left a £22bn black hole in the public finances she needs to fill.
It is a claim that is highly contentious. At least half of that black hole stems from her decision to increase public sector pay by between 5 and
6 per cent. But it provides the political justification she needs.
Capital gains tax, pensions tax relief and inheritance tax are all on the table as Reeves looks for ways to balance the books. She is also considering a change in Labour’s fiscal rules that at least in the short term could free up £16bn.
Reeves has said that there will be “difficult” decisions on welfare, public spending and tax. Even with such a big majority there is likely to be a backlash. Shortly before MPs broke off for summer, Reeves announced an end to the universal winter fuel allowance, which is worth £200 a household. From this winter it will only be given to households claiming pension credit; charities have warned the change will hit 2 million low-income households.
Many Labour backbenchers are alarmed, and that will only grow if Reeves presses ahead with further cuts to public spending and welfare. Given
that a significant body of MPs is already pushing for Labour to end the two-child benefit cap, more cuts could end in a full-on revolt.
In a bid to balance the books, Reeves and her team are in talks with the Office for Budget Responsibility, the fiscal watchdog, about whether supply-side reforms, such as planning, can be included in official forecasts. The more the government can increase the fiscal headroom, then the easier the Budget will be.
As ever, politics is a brutal business. The Tory leadership contest will conclude on November 2. But almost as soon as the new leader is announced, he or she will be eclipsed by another, far more significant political event: the US election on November 5.
The journey from power to relative irrelevance can be remarkably swift.
Steven Swinford is political editor of The Times
Power play: Keir Starmer and Rachel Reeves are planning to shape the economic and political narrative for years to come with a series of measures this autumn
photo: Getty Images
SZU PING CHAN ON ECONOMICS
The biggest challenge Britain faces is keeping its success stories here
There is a scale-up difficulty as fundraising gets harder, but companies also need to feel loved
Another day, another delisting.
The £5.4bn private equity deal to buy Hargreaves Lansdown will take yet another British success story off the UK stock market. There are more in the pipeline. What used to be the exception is becoming the rule. The number of companies traded on the London Stock Exchange has been in steady decline for years, falling from more than 2,400 a decade ago to around 1,800 today. Industrial software maker Aveva, supermarket Morrisons, defence supplier Meggitt and outsourcer G4S are just a few of the companies that used to be traded in London. Others such as Ashtead are also reportedly on the way out.
The truth is Britain’s biggest companies aren’t so big anymore. Yes, the FTSE 100 is a £2tn index, but the value of all of Britain’s leading companies combined is still slightly smaller than the market value of Apple. There is also a widespread perception that British stocks are cheap. Take the price to earnings (P/E) ratio, which looks at the relationship between a company’s share price and how much it makes. The higher the number, the further away it is from its value. Stocks on the S&P 500 in the US trade at a P/E
ratio of roughly 20. For Europe’s STOXX 600, that number is 13. The London market has a ratio of about 11.
Company bosses are no longer sitting on the sidelines waiting for things to change. The biggest name of them all is perhaps Shell, which has the largest weighting in the FTSE.
“I have a location that clearly seems to be undervalued,” said Shell’s chief executive Wael Sawan earlier this year, as he tried to explain the gap between London-listed Shell’s £175bn valuation and that of rival Exxon Mobil, which has a market cap of £410bn. All options were on the table, he added.
Of course, fundamentals play a big role. Exxon makes more money than Shell, but the returns speak for themselves.
The S&P 500 is up 83 per cent across the past five years. The FTSE is up less than 13 per cent during the same period.
It’s not all doom and gloom. Here’s a little-known fact: Britain has the most unicorns –start-ups with a value of at least $1bn – in Europe. And they’re not all tech businesses either. Companies such as software business Quantexa, schools group Inspired Education and OakNorth bank have all grown into billion-dollar businesses. The biggest challenge Britain faces is how to keep them here.
The scale-up task in Britain cannot be understated. One thing I repeatedly hear from City bosses is how frustrated they are about the time and resources it takes to raise money in the UK compared with elsewhere, especially when they’re looking for a big cheque.
The feedback from some British companies is that they spend more than a third of their time fundraising, compared with less than 20 per cent in the US. More time on the road trying to raise money means less time focused on growing their businesses.
There are those trying to do things differently. Take James Harrison. His company Cycle Pharmaceuticals stunned markets back in June with an audacious $466m (£355m) allcash bid for its listed US rival Vanda. I interviewed Harrison recently and his story left a big impression on me.
Harrison started Cycle in 2012 with patient capital from institutions including the University of Cambridge. He rejected the private equity route for funding and has been growing the business steadily ever since.
In many ways, someone like Harrison should have already cashed in on a US stock market flotation. Around 99 per cent of Cycle’s sales are in the US
I have a location that clearly seems to be undervalued
Wael Sawan, Shell
and many of its employees are based there as well.
Harrison told me two things are keeping him in the UK. Loyalty is one. After all, he says the British state subsidised his education and taught him the tools of the trade. Second, and as the name suggests, he has “patient” investors. Harrison does recognise why so many are seduced by American investors who have deeper pockets and are more willing to take risks. After all, many company bosses today are more like Premier League football managers than corporate stewards. The pressure to deliver results quickly can be immense.
Harrison’s funding model means that, in his words, he didn’t face the inevitable “fork in the road” where companies – particularly those in the biotech industry – need big
bucks to turn their idea into the next blockbuster drug.
“All the really big venture capitalists that can sign cheques of $100m-plus tend to be American,” he says. “If they subsequently fail, they fail. And if they subsequently succeed, they become ever more American [because the next step is usually a flotation].”
Part of stopping the slow drip of companies moving away is money. The chancellor, Rachel Reeves, wants to follow in the footsteps of her predecessor Jeremy Hunt by getting more of our retirement savings working for the UK economy.
Some of it is about showing we care. Many of Britain’s unicorns are far from household names. But why not? We should be celebrating their success. After all, if they do well and hire more people, that
means more tax revenues to fund public services.
But many feel unloved. The boss of one private firm valued at more than £5bn told me that he’d been courted several times by US stock exchange officials.
“I’ve had little more than a back-office clerk from the London Stock Exchange paying me a visit,” he laments.
Keeping up appearances matters. There aren’t too many ways we should be copying the French president Emmanuel Macron, but his knowledge of how to roll out the red carpet is one.
An excellent report by Lord Harrington last year on how to boost foreign direct investment noted that businesses had become accustomed “to receiving texts directly from Macron, being invited to the Palace of Versailles” and being
given the star treatment. It may sound superficial, but sometimes in business, personal relationships are what really matters.
Rules and regulation are also hindering Britain’s success. One thing that struck me about the Hargreaves Lansdown deal is that analysts said it would be easier for the investment platform to cut fees under private ownership. Fees are a fundamental part of a business such as Hargreaves. Companies must be allowed to compete and not be obstructed by red tape.
I look at it this way. The opportunities in the UK are immense. Policymakers, regulators and businesses must seize them before something more insidious takes hold.
Szu Ping Chan is economics editor of The Telegraph
photo: Getty Images
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Entrepreneurs don’t predict the future – they create it
TOM BEAHON
Co-founder and CEO of Castore
If the UK economy were an individual stock, it would come with a strong “buy” recommendation. Despite having faster growth than other G7 countries, world-class universities, globally-respected legal institutions and political stability, our stock market is valued at a discount to almost any other big economy and the number of private companies seeking growth capital from public markets is approaching historic lows. Our potential is huge, but unless something changes we will all be poorer in the future.
Opinions vary on the biggest challenges facing the UK, but the need to improve productivity is high on the list. How we approach this next stage of Britain’s future will define our collective prosperity for a generation.
It is imperative that the new government demonstrate the ability and desire to support the group that will lead this transformation. Growth will not be led by the public sector or centralised quangos, it will be created by a group of people who transcend all tech and policy changes: entrepreneurs.
Entrepreneurs are wired differently, and in a way that many behavioural economists fail to understand. They don’t make decisions based on perfectly logical data and information. Instead, they have a vision for the future that others can’t see, possess a deep passion and tenacity to bring their vision to life, and usually
a strong element of bloody mindedness that refuses to give up long past the point of rational thinking. As a group we are far from perfect – by definition, if you exist to push the envelope, every now and then you will push too far. But without entrepreneurs, the world would have progressed at a fraction of the rate it has already, or has the potential to in the future.
We now live in a globally connected and therefore globally competitive world. Politicians need to recognise this and have clear longterm strategies to attract entrepreneurs to the UK. The French president Emmanuel Macron may not be the most popular politician in Europe, but he has made France a more attractive place for wealth creators and risk takers.
The new government needs to make its intent towards entrepreneurs clear – and soon. So far, the focus has been firmly on other areas and there has been a distinct lack of understanding that it is the energy, ideas and ingenuity of business creators that will allow Sir Keir Starmer to achieve his objective of making the UK the fastest growing economy in the G7. Giving train drivers above inflation pay rises is not likely to have the same impact.
How many of the current cabinet have started their own business? Do they know what it feels like to take the risk of hiring new staff based on your belief of growth that may not
materialise? Or invested in a new factory or warehouse that will only show its worth far beyond the usual five-year political term? Entrepreneurs are constantly making nearterm sacrifices in return for longer-term gains – the public sector can’t replicate this.
The lack of support to these people can only go on for so long before it has a seriously negative impact.
The vast majority of founders I know are proud patriots – it gives them genuine pleasure to create jobs, pay taxes, and deliver products and services that enhance the communities in which they operate. They love the UK and want to make it a better place to live for everyone. But they are also deeply competitive and want to make their companies as successful as they can. If they can do that elsewhere, they will. More entrepreneurs have said to me in the past 12 months that they are seriously considering leaving the UK than ever before. This isn’t a party political criticism, but rather a genuine risk that some of the most talented people in the country will choose to leave, which will not benefit anybody.
The Autumn Statement must include policies that demonstrate this Government understands and supports business owners. The message from entrepreneurs to policy makers is clear – we want to create wealth that benefits all. Back us, and your investment will be repaid tenfold.
How Signable turned its institutional knowledge into gold with Slack and AI
At the core of any highperforming business is an AI-powered platform that runs so well, you don’t even realise it’s there. It connects people to the information they need to do their work and integrates other apps to ensure everything is in one place.
Let’s uncover how the eSignature software provider Signable has harnessed this strategy to take its business to new heights.
Embracing digital transformation and saying goodbye to pen-to-paper
In an increasingly digital world, Signable’s eSignature technology is essential. It makes it simple to send, sign and sort documents – and does it through its enhanced security features like SSL encryption, two-factor authentication and a full audit trail.
However, Signable is also more than a product. It is proud of its culture and is recognised as one of the UK’s best workplaces by the Great Place to Work organisation, in particular for women, wellbeing and development.
Delivering efficiency and collaboration in both its platform and culture means empowering employees so that they can solve problems at speed. This requires rapid coordination at all levels. For the business, Slack plays a central role in its operations.
Fuelling digital transformation with unstructured data
Oversight, trust and accuracy have
always been imperative to what Signable does. To achieve those priorities, a 360-degree view of customer activity is vital.
By embracing digital transformation, every business has been gathering huge pools of rich contextual data that holds vital insights. And while this data is vast, it’s also largely disorganised. In today’s world, that’s changing.
Thanks to AI, organisations – like Signable – can organise mountains of unstructured data.
Years of institutional company knowledge can be used to teach machine learning models, personalise algorithms for targeted marketing campaigns, inform learning and development and solve problems that were previously hidden.
Slack uses AI to help firms harness their unique institutional knowledge. At Signable, by seizing vast quantities of unstructured data in the form of customer conversations and feedback has enabled us to innovate with it. The ‘All at Once Signing’ feature is a prime example of this.
This feature was conceived and developed with the support of Slack, using the insights and data gathered through the platform. The company identified the need for it by analysing its net promoter score (NPS), which is automatically fed from its customer relationship platform into two Slack channels – spaces for conversations to take place. That feedback revealed a clear demand for a feature to send a document to multiple people to sign simultaneously, giving users more control over how they share documents. And so, it created ‘All at Once Signing’, resulting in a better experience for customers and a product it knew was meeting real demands.
Using AI to accelerate digital processes for Signable’s people and customers
Alongside empowering its team to build new products, using Slack means fewer meetings for the team at Signable, as people can easily share posts, video or audio clips, which they can catch up
on at any time. If a live discussion is needed, people can hop on a huddle – real-time audio or video conversations. The team estimates these features save them at least a meeting’s worth of time every single week. Crucially, all information –which previously would have been unstructured data – is clearly logged in Slack. That means Slack’s AI can rapidly surface relevant insights and enable people to get the answers they need immediately.
The team at Signable is never waiting on a question, spending hours hunting for a lost message or document, creating unnecessary meetings or swapping between tools to find information. As a result, customers get answers and solutions faster than ever before.
AI-powered work for businesses of every size
At Signable, the team is going to keep leveraging Slack in new ways. Most recently, it has launched a native integration into the tool that notifies a user in the Slack channel of their choice as soon as someone signs their document, allowing them to immediately take the next step. By ultilising Slack in this way, Signable can achieve more, respond faster, communicate more effectively and deliver game-changing new products. As it continues to grow, Signable couldn’t be more excited about what’s on the horizon.
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Monzo interview
TS Anil on how he has scaled-up the £4bn digital bank
Customer-centricity
True customer focus is hard to achieve. Here’s how to do it
Creating a market
How De Beers brought diamonds to the world
Market research
How to do it well – and the pitfalls to avoid
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Behavioural science
The human biases that businesses can exploit
48
Case study
One of the UK’s fastestgrowing companies explains its strategy for success
Caspar Lee
Gen Z marks the end of the untouchable boss
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53 24 30 36 40 44
Marketing masterclass
The marketing director of Italy’s top football league shares his expertise
Bookshelf
Our must-reads on consumers and decision-making
MISSION CONTROL
When TS Anil took over as boss of Monzo, the digital bank was criticised for not having a business model. Now it is worth £4bn
GRAHAM RUDDICK
It is the summer of 2020. Monzo is one of a collection of new digital banks that is growing rapidly in the UK, alongside Revolut and Starling. Its latest financial results show that during the past 12 months it has more than doubled the number of customers it has from 1.6 million to 3.9 million.
But the results also include some concerning numbers. Annual net losses have widened from £47m to £113m. Analysing the results, the Financial Times said that Monzo was a bank “favoured by those who like to drink £6 Negronis at rooftop bars in south-east London”. But as an actual business, it had a problem. “Flicking through the results, it’s achingly clear what the problem is,” the FT wrote. “Monzo has yet to find a real business model.”
Banks make money by lending money to customers and charging them interest. But Monzo was barely issuing any loans. It had customer deposits of £1.4bn but only made £124m of loans and advances, according to the FT analysis.
Investors also seemed concerned. Monzo had raised £58m of new funding from investors in 2020. This valued the company at £1.25bn, which was impressive for a business that was only founded in 2015, but it was around 40 per cent less than its value in the previous fundraising round.
The valuation reflected the challenges that Monzo was facing and how the Covid-19 crisis had slowed its growth plans.
On top of all this, Tom Blomfield, the co-founder of Monzo, had quit as chief executive. Blomfield would later say he had been struggling with his mental health. “I was stressed, definitely. I suffered anxiety that impacted my sleep. Did I border on depression at times? I don’t know,” he told The Guardian.
Blomfield was not enjoying the challenge of scaling-up Monzo from a promising start-up to a big company. “I stopped enjoying my role probably about two years ago,” he said in a 2021 interview with TechCrunch. “Taking on a bank that’s 3, 4, 5 million customers and turning it into a 10 or 20 million-customer bank and getting to profitability and IPOing it – I think those are huge exciting challenges. Just honestly not ones that I found that I was interested in or particularly good at.”
This was the backdrop to TS Anil becoming chief executive of Monzo in 2020. Anil initially joined in 2020 as the chief executive of Monzo’s US business after 25 years working in the finance industry around the world for Citi, Capital One, and Visa. He was working in San Francisco, California, for Visa when the opportunity to join Monzo emerged.
photos: Rahul Singh
A mission without a business is a strapline. Anybody can write one, but those two things need to come together
“My first impressions of Monzo predate my starting in the company and cut to the heart of why I was excited about joining Monzo in the first instance,” he says. “I had seen from the outside, and in conversations with the Monzo team before I joined, an extraordinary culture, which you couldn’t make up. Customer-centricity and building everything around the customer was a deeply felt belief in the company. The initial tech-stack platform had been built and there was a magical product-market fit.”
After joining in February 2020, Anil’s job quickly changed. By May 2020 he had been named chief executive of the whole business and the world was in lockdown due to the Covid-19 crisis.
Anil had been encouraged by Blomfield and Gary Hoffman, Monzo’s chairman, to put himself forward as the next chief executive, but he was in lockdown in California while Monzo was based in London.
“I started my day at two or three in the morning, every single morning, because
I’m working UK hours,” he recalls. “Everybody’s working from their living rooms or kitchens or studies because the whole world is locked down in March and April of 2020. That was the surreal context when Tom and the board called me about this.
“I knew instinctively that this was the sort of thing I wanted to do. I understood the company enough and the opportunities ahead of us, as well as the challenges. I had spent weeks in the trenches with the team. But I was a continent away.”
Anil spoke to his family and made the decision to take the job. “We made it work and I’ve never looked back. I was massively excited then about the opportunity and still feel that way every morning.”
His first task was to immerse himself in the company. “I had to learn people, learn the business, learn our story, learn what had worked for us and learn the domain,” he explains. “I hadn’t worked in a small tech company that was growing so fast. I was learning every day – from junior engineers in the company to senior colleagues on the executive committee.”
Anil learned, as expected, that the business had grown rapidly and had a big opportunity ahead. But he also saw that Monzo needed to move to the next phase of its growth.
“I learned what new muscles we needed to build as a company,” he explains. “This sounds like it’s Monzo’s story, but it’s true for any small start-up that becomes a scale-up and then becomes a truly big and successful company. That journey requires new muscles at every stage.”
This included addressing the issue with Monzo’s business model that critics of the bank had identified.
“Building out the business model was a better problem to have than legacy players [the traditional UK high street banks], that have a business model but don’t have any of those other things,” he says.
“We’re standing at the cusp of the transformation of the industry because of that. Legacy players have a legacy business model, but they don’t have the technology to succeed, they don’t have the connection with their customers to succeed, and they don’t have the mission, the will, the DNA or the culture that makes them want to solve those problems for customers,.”
“I didn’t disagree with the coverage. We were a company that needed to build out its business model. That’s a better place to start than the alternative, which is where
the legacy industry was at.”
In response, Anil set about developing the business model, while also having the conviction to stand by the company’s mission. “I said early on at an all-hands or some other meeting that a mission without a business plan is a bumper sticker. It’s a strapline. Anybody can write one. But those two things need to come together. We’ve put a lot of thought and rigour behind that, which is building a business model that is consistent with the mission. It’s not an unsolvable problem. It’s a difficult problem, but not an unsolvable one. If you get it right, the mission and the business plan reinforce each other.
“We knew that for us to really fulfil our mission, we needed to be sustainably profitable. Otherwise it’s a flash in the pan that goes away. To really build something at scale, the business plan was crucial to that. The more successful we are from a business plan perspective, the more customers we can serve. We can serve them because we are sustainably profitable.
“But if you flip that, how does the mission help the business plan? The mission makes us focus on building products that actually solve customer needs. Our mission makes us solve them in a way that is fair and transparent. Our mission makes us price it in a way that we’re not embarrassed about – I can defend our pricing. Our mission makes us communicate to our customers in a way that they understand the product. We will make good choices for them and therefore we win when they win.
“As warm and fuzzy as it sounds, that is core to the business model. It results in this disproportionate user growth that comes through word of mouth. That has enormous monetary value in an industry where people pay £100 or £200 for every new account opened.”
Two-thirds of Monzo’s new customers every month come via recommendations from friends and family, which is a striking
Our customer connection is one of intimacy. We build our products close to our customers
statistic. Monzo has no physical branches, but this has not stopped it being ranked as the best current account provider for customer service in the UK by the Competition and Markets Authority every year since 2020. Anil says Monzo “obsesses” about looking at customer metrics.
“There’s a whole range of quantitative, metric-oriented ways in which we understand that, but this is about more than that, right? It’s about the soul of what we’re trying to do,” he says. “Our customer connection is one of intimacy. We build our products close to our customers. Every product meeting builds on the customer insight, which could be because we did a piece of research with customers, or we saw how they’re using the app or a community blog post, which, by the way, is a treat to read. It’s an engaged community that doesn’t hesitate to comment on our product roadmap, give us critical feedback about how features in the app are working and what else they want.” These new products include an
investment offering. “When we asked customers in the UK who they would like to buy an investment product from, Monzo made it into the top five. We didn’t even have a product. That trust that Monzo is going to do the right thing is unparalleled across industries, let alone in the world of financial services and banking.”
Under Anil, Monzo has grown up. Its latest results show how much progress has been made since he took charge. Monzo now has more than 10 million customers, up from 3.9 million in 2020. It generated revenues of £880m in the 12 months to March 31 2024, more than double the previous year. Revenue is now coming from subscriptions for premium accounts, investment and savings products, fees on transactions, and an uptick in lending to consumers and businesses. Monzo also made a pre-tax profit of £15.4m in the 2023/24 financial year – its first annual profit.
Investors have backed Monzo with another £500m of funding in 2024. This valued the bank at £4.1bn, nearly quadruple the valuation when Anil joined.
There is more to come. The traditional UK banks still account for 85 per cent of the consumer market and most households still use them for their main bank account, into which their salaries are paid. But Anil thinks it is too late for the traditional banks to catch-up with Monzo’s technology. “It is that confluence of legacy tech, legacy business model, legacy mindset,” he says of the traditional banks. ”Our technology spend is a fraction of what a typical large incumbent bank will spend in the UK, yet we get 10 times the value of that spend.”
Expanding overseas is also an option for Monzo. As is floating on the stock market. “We will make a great public company one day,” Anil says. “There’s going to be a time for us to do it. I think it’s too early to speculate on that. We want to make sure we continue to scale the business and make a great story to the public markets.”
How to become a customer-centric organisation
True and lasting customer focus is very hard to achieve. So how can businesses make it a reality?
ELLEN HAMMETT
Ask any business whether it is customer centric, and you will be hard-pressed to find one that says no. Being seen as customerfocused is considered a hallmark of success, competitiveness and aspiration, whether businesses achieve it or just believe they do.
Yet the reality is that few businesses – even those with mega budgets – implement a true and lasting customer-centric strategy because it is far more complex than most people believe it to be.
For a start, businesses operate in unpredictable environments, rocked by market changes, advances in technology, changing culture and consumer behaviour. The goal posts of customer experience are always moving.
Some, particularly small and medium-sized businesses, are hindered by internal barriers such as legacy systems, resources and siloed teams. Others are driven solely by profit, with decisions financially and shareholder centric, which works fine until it comes at the expense of customers, after which growth prospects can look dim.
Boeing is an extreme example of what happens when businesses lose sight of their customers. Once known for its loyal customer base – its slogan was “If it’s not Boeing, I’m not going” – urgent safety problems have called into question the aircraft manufacturer’s motivation and been linked to putting profits before customers.
What is real customer centricity? Broadly speaking, it is defined by the ability of a business to understand – and even predict – its customers’ needs, and to focus all strategic decisions and processes, from the boardroom down, to meeting them. The idea is to use this granular focus as a lasting competitive advantage, and thus ensure sustained growth and profitability.
The trouble is, even experts admit true customer centricity is “complicated”. Jacob Gascoine-Becker, partner at customer analytics group Strat7 Advisory, uses a 30-point assessment to determine how customer centric a business is. It is based on aspects ranging from understanding the needs and motivations that lead to customers engaging with a particular company, to where customer experience its as an organisational objective.
However, where the battle is mostly won is the operating model. “You might have the knowledge and slick marketing processes, but the real challenge is for customer centricity to be a business objective, rather than just a marketing or customer-focussed objective,” says Gascoine-Becker. Another
“good barometer” is how well the C-suite demonstrates customer understanding. When, for instance, was the last time the chief executive spoke to a real-life customer? “It starts from the top, so how can you possibly be a customer-centric business if that’s not happening?” he adds.
A whole business approach
Every Monday, First Direct’s chief executive, Chris Pitt, calls a customer of the bank who has had a bad experience.
“It allows me to turn the data I get as CEO into something very specific in terms of the human issues we want to solve,” explains Pitt. “I’m not ringing customers to try to persuade them the issue wasn’t an issue; I can just offer some context and say how we would like to help.”
It is rare to get a chief executive so close to the coalface but it does pay off. According to Deloitte research, 64 per cent of companies with a customerfocused chief executive are more profitable than their competitors.
For Avinav Nigam, CEO of healthcare recruitment business Tern Group, customer centricity means putting the customer “at the heart” of every business decision and operation, “not just reacting to customer needs but also anticipating them and innovating accordingly”.
Alongside enabling cross-departmental collaboration, Nigam tries to integrate customer experience into the company’s culture and values.
“Incorporating customer feedback into decision-making, through regularly collecting and analysing customer feedback to inform strategic decisions across all departments, helps employees to see the direct impact of their work on customer satisfaction,” he adds.
Listening to consumers is core to media group Hearst UK’s customer strategy.
“Not just in feedback surveys but in person,” says chief executive Katie Vanneck-Smith, who encourages employees “from the top down” to speak to customers regularly at events. VanneckSmith tries to do this herself, at least twice a month, and personally responds to all customer communications that reach her.
“There is nothing like it for idea generation and knowing what to prioritise,” she says.
Customer centricity may have evolved to be a whole business challenge, but marketers continue to play an essential role in aligning the business to its consumer. Amid increased competition, customer centricity has been integral to overall business growth and profitability at Domino’s. Today, it is a business-wide objective led by its marketing team.
“If you’re going to be a truly customercentric organisation, it can’t just be marketing,” says marketing director,
Having our own team members as the initial ‘customers’ provides invaluable insights, as well as real perspectives
Amanda Zafiris, Canva
How First Direct
maintains a customer-first approach
When First Direct launched in 1989, it began with the word “customer” written on a piece of paper. Its strapline was “Pioneering Amazing Service”, and the customer has remained at the heart of what it does. Testament to this, First Direct is the second highest rated bank for net promoter score (NPS) and has consistently topped the ranks of various customer service surveys, most recently KPMG’s Customer Experience Excellence 2023.
“It comes back to the culture, it’s in the DNA,” says chief executive Chris Pitt, who sits in the call centre daily with the rest of the senior leadership team.
Here, he holds a monthly “customercentric” meeting, where the leadership team discusses a particular customer issue and where improvements need to be made. The customer voice is always brought in, usually through a call that presents a specific challenge, to add some “humanity”. The company’s NPS is assessed as a business by channel, product and journey to enable the team to track progress.
Pitt has a simple equation to ensure he is balancing customer needs with business needs. To “grow at scale” (the operational strategy), First Direct must: maintain number one customer service, do it within the cost base, and take everyone in the company on the journey.
“You don’t want to deliver growth and see your customer service suffer,” he says. “And you don’t want to see growth with cost going out of control or if you’re not taking your people with you.”
You don’t want to deliver growth and see your customer service suffer
Chris Pitt, First Direct
Harry Dromey. “Where there is a high degree of competition in the market, your competitive advantage is making sure you’re more consumer centric than your competitors. You need to generate a business model out of that to make sure it’s profitable.”
Jen Brown, senior director of international marketing at business communication group GoTo, believes a marketer’s ability to collaborate with people and teams across the business is instrumental. “That puts us in a good place to make sure everyone is being customer-focused,” she says. “Doing the right thing and focusing on your audience is good for the bottom line.”
According to Deloitte, customer-centric companies are 60 per cent more profitable than their counterparts and linked to higher share price growth.
“If you look after your punter, your numbers look after themselves,” says Pitt.
The small business challenge SMEs face different problems with customer centricity. As they grow and innovate they can find themselves further from their target audience, and with fewer resources to understand, reach and communicate with it.
Gascoine-Becker highlights an irony here. Technically, having a smaller audience base and compact teams means SMEs can react to market changes and customer demands more rapidly.
“But their knowledge of the customer and their sensitivity of these trends in the market is often limited, or based on assumption, as they have smaller budgets and rarely have evolved customer insights programmes,” he explains.
In contrast, big companies can more easily be customer centric because they can constantly update their
It’s about not just reacting to customer needs but anticipating them and innovating accordingly
Avinav Nigam, Tern Group
knowledge about customers and test new concepts with them. But the “scope of that understanding and application is increasingly narrowed”.
“They are often not thinking about how the brand needs to be positioned in future given all the trends happening in the market,” Gascoine-Becker says. “Whereas, ironically, small businesses are thinking about that all the time because the control within the company is much more distilled.”
The video rental company Blockbuster not adapting to its customers shifting to streaming, or Kodak failing to predict how its invention of digital cameras would disrupt its print business, are prime examples of businesses missing the boat.
The “customer zero” approach used by graphic design platform Canva might be an appealing concept for SMEs looking to overcome budget and resource challenges. It has been an instrumental tool in “fostering innovative thinking and achieving overall success”.
“Every business has the hidden potential of the internal customer — its employees,” says head of Europe marketing, Amanda Zafiris, who explains Canva uses its employees for testing products and giving feedback before rolling them out. “Having our own team members as the initial ‘customers’ provides invaluable insights and real-world perspectives, helping us to refine the product to the best of its ability.”
Measuring customer centricity
Done well, a customer-focussed strategy should see improvements in key metrics such as customer satisfaction, loyalty and advocacy, helping to boost overall results.
To make it work, both chief executives and marketers agree that outward-facing
metrics should be prioritised above inward ones. “The focus needs to shift from traditional internal efficiency metrics to customer satisfaction, retention and lifetime value,” says Nigam. These metrics can then be aligned with internal key performance indicators to ensure the entire organisation is working towards enhancing customer experience.
“Align incentives with customer outcomes: connect employee performance metrics and incentives directly with customer satisfaction and loyalty metrics,” he adds.
Brown highlights a challenge that will resonate with many marketers and which often prevents businesses taking a truly customer-centric approach.
“As marketers, we’re at the front of the stage looking out at the audience and trying to engage and reach them, but a lot of the time we are forced to turn around and communicate with the back of house. So we spend a lot of time looking at inward-related metrics – which are really important, we have to have targets – but it can drown out the outward-facing measurement we need to truly understand if what we’re doing is resonating.”
Artificial intelligence and automation are playing a growing role in enabling marketers to aggregate and analyse customer data more efficiently, and to “listen to customers at scale”.
“I would love to understand the needs of every single customer in our base and that is becoming more realistic with artificial intelligence,” says Brown.
“Whether it’s AI, automation or a solid relationship with marketing analytics, marketers must demand the support to get the data served up to them on a plate so they have both the time to analyse data,
Customer service champions
Top rated organisations for customer satisfaction, based on a survey of 15,000 UK adults, 2019-24
inward and outward, and then put it into practice to monitor and optimise their campaigns.”
While Dromey acknowledges AI can make customer strategies more effective and efficient in many ways, he says it must still always start with “what’s the job we need to do for the consumer?” and never with “what can we do with AI?”
There is another powerful use emerging for AI: the ability to make sense of unstructured data from a mass-scale listening perspective.
Gascoine-Becker explains: “Every strategy is based on a set of assumptions around what is going to make you successful, or what customers are going to do in future. Those assumptions can almost always be turned into measures you can track over time, which are the key basis for decisions.”
But, if the assumptions turn out to be untrue, it can be expensive to reassess the strategy and change direction.
“AI gives you the opportunity to monitor on a much bigger scale than primary consumer research, to turn those assumptions into measures while spotting [new trends] early and adapting to them quickly. The more businesses get used to tracking things like that, the more customer centric they’re likely to be because they’re in tune with those changes,” he adds.
Speak to customers personally – there is nothing like it for idea generation and knowing what to prioritise
Katie Vanneck-Smith, Hearst UK
Source: The Institute of Customer Service
Ultimately, businesses can only truly understand and anticipate customer needs if they are the driving force behind the operational model, which is woven into the organisational culture and understood from the top down, across all teams. That is the key not only to winning, but to keeping, customers and is fundamentally what customer centricity is all about.
A market from nothing
When De Beers found itself with a glut of gems and no buyers, it used glamour and royalty to create a market where none existed
BRUCE WHITFIELD
“I
f I had asked people what they wanted, they would have said faster horses,” Henry Ford, the founder of Ford Motor Company, once quipped. Steve Jobs, the founder of Apple, didn’t conduct focus groups and yet developed a range of highly coveted products no one knew they wanted until they were available.
But probably the best example of creating demand for a product where there was none is diamond giant De Beers.
It convinced generations of men they should spend at least two months’ salary on a diamond engagement ring and told women that their peers would judge their choice of spouse by the size of the stone set in it. It did it through powerful marketing across a number of decades, including the creation of the world’s longest-running commercial payoff line. But it almost never happened.
This was an astonishing achievement considering that the fraught first half of the 20th century was hardly conducive to jewellery demand. Consumers were not in the mood for trinkets and baubles, so De Beers had to ensure its product became a requirement for any suitor wanting to be taken seriously by his prospective bride.
Until the 1950s, most diamonds found their way into industry and there was little apparent desire for high-quality gemstones. This left the world’s biggest supplier, with its 80 per cent global market share, with millions of carats of sparkling stones locked up in vaults with no one to sell them to.
Popularising diamonds by making them essential to the courting ritual was the brainchild of a young Harry Oppenheimer. His father, Sir Ernest Oppenheimer, had secured family control of global diamond supply via De Beers, which consolidated the industry after discovery of the richest deposit ever found in South Africa in 1867.
Until then, diamonds had been scarce, found mostly in remote Indian and Brazilian riverbeds. They were also the preserve of a shrinking aristocracy. That all changed with the Kimberley mine discovery, which would yield an estimated 14.5 million carats or 3,000 kilograms of stones – enough to fill a large bathtub. It caused a glut in supply and a headache
for the firm as it would render them essentially worthless without a cartel-like control of supply.
Oppenheimer knew he needed to convince women of the beauty and scarcity of diamonds as a symbol of everlasting love and make it essential for suitors to show their eligibility by buying them. Work began in 1938 but did not take off until the postwar consumer boom driven by the US-led reindustrialisation of the global economy.
Oppenheimer gave the Philadelphia advertising agency N.W. Ayer exclusive rights to place its adverts for diamonds in American media and funded the research on how it should best be done.
This began a decades-long exercise in myth-making. Until then, about 10 per cent of women in America wore a ring with a precious stone to symbolise commitment and the idea had little traction elsewhere. By the end of the century, around 90 per cent of American women wore a diamond ring to signify they were engaged and the trend was replicated in other westernised economies around the world.
Long before FOMO existed, De Beers and its ad agency were creating influencers and even sought the support of the late Queen Elizabeth II. The agency embarked on a range of strategies, using the booming movie industry and a new generation of Hollywood stars to glamorise and popularise diamonds. Famous celebrities such as Liz Taylor and Marilyn Monroe wore them at every high-profile society event they attended.
An internal N.W. Ayer memo at the time read: “Since Great Britain has such an important interest in the diamond industry, the royal couple could be of tremendous assistance to this British industry by wearing diamonds rather than other jewels.”
Diamond advertising took on a new glamour by appearing on the fashion pages, while renowned designers and trend setters were encouraged to talk about them as a fashion must-have at every opportunity.
By 1947, a strategy document outlined the plan to “strengthen the tradition of
Top to bottom: Adele at the 54th Grammys in loaned De Beers earrings; and the late Queen Mother wearing a diamond tiara comprised of diamonds given by De Beers to Edward Vll
A young copywriter scribbled the words
‘a diamond is forever’ on a scrap of paper. Little did she know that the line would outlive her
the diamond engagement ring” and it proceeded to provide newspapers with detailed descriptions of the diamonds worn by stars at big events.
The 1948 strategy was to “spread the word of diamonds worn by stars of screen and stage, by wives and daughters of political leaders, by any woman who can make the grocer’s wife and the mechanic’s sweetheart say ‘I wish I had what she has’.”
The real key was its tag line. A young copywriter called Frances Gerety scribbled the words “a diamond is forever” on a scrap of paper next to a picture of a couple on honeymoon late one night in the early 1950s. Little did she know that the line would outlive her.
Advertising industry lore suggests that her colleagues were not particularly impressed by the line but presented it to their client anyway as they had nothing better to offer. It has become synonymous not only with the enduring quality of the product, but the belief that marriage should be a lifelong commitment.
One of the most important factors in the success of the campaign was the company’s long-term commitment to and investment in driving home its core message to new markets in the 1960s. By the end of that decade, global ad agency J Walter Thompson had helped De Beers create a $1bn-a-year market in Japan, making diamonds as much of a requirement to courting couples there as they were in the US.
As competition from smaller stones found in Siberia risked destabilising the cartel, Oppenheimer sealed a deal with Russian producers. N.W. Ayer then shifted its messaging, so it was no longer just about size but about quality. The new watchwords in the diamond industry became clarity, colour and cut.
This marketing strategy proved extraordinarily successful. By 1979, sales had grown 100-fold and the advertising budget by about half that. In 1939, for example, sales of jewellery-grade diamonds were $23m a year with an annual advertising budget of $200,000.
Forty years later, this has expanded to more than $2.1bn in wholesale revenue off a marketing budget that had grown to $10m a year. At its peak in the early 2000s, the company was spending up to $200m a year promoting its product.
But, more recently, that has fallen sharply as cracks appeared in the diamond market. “The supply/demand balance has been heavily affected by China,” says David McKay, who is the editor of the trade publication Miningmx.com.
“The decline in Chinese demand probably dates from the start of the trade war with the US in 2018, followed by Covid, which also led to a decline in the number of marriages in many parts of
the world. China comprised 1.5 per cent of total sales in 2000 and 15 per cent by 2015, so any change there is going to be significant,” he says.
Added to this, De Beers reported a sharp decline in overall sales that it attributed to “challenging market conditions and new competition from lab-grown stones”. In 2023, it announced a considerably reduced $20m budget for its “Seize the Day” campaign, which primarily used social media channels.
The price of natural stones has fallen sharply, and volumes are down by about a third on this time last year. In early 2024, De Beers chief executive Al Cook announced it had discontinued its lab diamonds project and would focus only on natural stones.
But while Cook has been upbeat about demand, analysts at Morgan Stanley have warned that sales of natural diamonds are in a downward spiral, saying “macro pressures continue to weigh on consumer sentiment, including in the US – the world’s biggest diamond market”. The bank said it was “yet to see pointers that the tide is about to turn”.
De Beers’ owner Anglo American is undergoing a substantial restructuring of its own that could see the diamond business sold or separately listed on a global stock exchange. Diamond analyst Paul Zimnisky believes new owners could breathe new life into the company, which has a complex structure that is heavily dependent on joint ventures in diamondrich Botswana and Namibia.
“That said, I think the best suitor would be someone that has deep pockets and can invest a sufficient amount in the business for the long term. A company like LVMH could qualify,” said Zimnisky.
For McKay, while a new owner – or an independent De Beers – could steady the ship, it needs more than that. “What the diamond sector most needs for itself right now is what it so readily sells: a little bit of love. That could come from an independent De Beers which has greater control over its cash flow or if a Gulf state buys the brand. Either way, selling diamonds is going to change – forever.”
That may be the case, but De Beers proves that it is possible to create a market out of nothing.
Harry Oppenheimer knew he needed to convince women that diamonds were the symbol of everlasting love
How to do market research
Research is the foundation of any growing business but is fraught with pitfalls to avoid
SARAH VIZARD
Without data, you’re just another person with an opinion.” The famous quote from W. Edwards Deming, renowned American business theorist and consultant, is as true now as when he first said it.
Data is the cornerstone of almost any business decision, from what products to launch, to which markets to go after, to what advertising to run. But knowing the best
way to get that data – and what to do with it once you have – remains as difficult as ever.
That’s where market research comes in. Data, intelligence and insights are the foundation of any good business, whether it is starting out, looking to grow or working on consolidating its position.
Good market research can tell a company what consumers are thinking and feeling, what motivates them and what they buy. The key word, though, is good.
Surveying current and prospective customers or running focus groups sounds like a simple job. The reality is it’s full of obstacles waiting to trip up those who don’t know what they’re doing. Surveys can be too long and the questions too confusing; people running focus groups can ask leading questions or accidentally influence the participants; or the research can be done with the wrong people or too few of them.
And the old saying, “garbage in, garbage out” applies just as much in market research as it does in other areas. To get results, you need to know what you are doing.
There are two types of market research, qualitative and quantitative. The former
involves in-depth interviews, focus groups or observations to collect information with a lot of detail and context. The latter is much broader, involving data in numerical form, usually obtained from surveys or tracking something such as sales or brand awareness.
“Qualitative research really helps you gain an in-depth understanding of what people need and want, what they like and don’t like – and why,” says Jane Ostler, executive vice-president of global thought leadership at the research agency Kantar. “Quantitative research is done at a larger scale to get the data and the insights you need – and may be cut into subgroups.
“You can either do these things as dips –just a quick market intervention to find out what’s going on – or you can do it on more of a longitudinal basis, which is generally some kind of tracking programme where you’re asking people the same questions over time to understand the variances.”
Whether to quant or qual first depends on the scenario. For brand positioning, strategy or advertising research, Ostler suggests starting with a qual element to understand the deeper desires, needs and wants of people. You can then test the results with a larger group using quant research. That is also a better strategy for businesses that have not done much market research.
For businesses with more mature market research that are already running quant surveys, qual can be useful to understand an issue that data throws up.
“Quant can tell us what is happening, but it doesn’t necessarily tell us why,” says Andrew Tenzer, co-founder of the research and thought leadership consultancy Burst Your Bubble. “Which one you need depends on your objectives.”
Before a business even starts to think whether it wants qual or quant, it must work out the reason for the research. Failing to do so is a common mistake, says Tenzer.
“Often, businesses think they need research when they don’t,” he says. “Plus, research should be hypothesis-driven. People will often say something like: ‘We need some insight on this audience.’ But what is it they really need? What’s the hypothesis? Often people can become a bit unstuck on that.
“They must be hypothesis-led in terms of what they want to find out, and they must be
willing to have their hypothesis challenged and their opinion changed. I can’t tell you the number of times stakeholders have found it hard to accept something in the data that goes against their view.”
Ross Farquhar, marketing director of the mochi ice cream Little Moons, recognises this. There have been “countless times” when he has been developing creative work and used research to evaluate it. He describes the horrible feeling of watching people “trash” work you think is good and might have spent months working on.
“That’s incredibly tough,” he says. “But you cannot be the ostrich that buries its head in the sand ... You have to show that you are listening to the research, that you have heard the key messages and that you are not stuck on an idea come hell or high water.”
There are other tips to ensure that businesses get the best out of market research. In quant, Ostler warns against surveys that are too long, too convoluted or don’t ask the questions in a way that makes sense to people. Routing is important; no one wants to answer irrelevant questions.
“You have to think of concise ways of doing a survey to make it interesting and possibly even entertaining to motivate people to answer the questions,” she says. “And you should use tried and tested market research techniques, such as a one-to-five scale, and make sure it works on mobiles.”
Sample size is also important. Whether quant or qual, the participants need to be representative of the whole market. For a consumer-based survey exploring the attitudes of the whole UK, a sample of around 2,000 should work – although that will depend on how many subsets a business wants to divide the results into.
For more niche audiences, the sample size will depend on the addressable market. Tenzer uses the example of a law firm that wants to understand high net-worth individuals better. There are not very many in the UK, so getting data from 100 could well be representative.
However, the more specific the audience, the harder it will be to reach – and the more it will cost. He says: “Businesses need to understand that research with hardto-reach audiences, whoever they are, is not cheap. Unfortunately, if you work in a
You cannot be the ostrich that buries its head in the sand... you have to show you are listening to the research, that you have heard the key messages
Ross Farquhar, Little Moons
Little Moons’ market research journey
Ross Farquhar, marketing director
When I joined the business, we did barely any market research. The job then was just to try to bring in the customer by setting up some basic brand tracking, doing some basic quant research on the addressable market and trying to get to know who the end consumers could be. We prioritised and segmented them to make a case for marketing investment, in my case.
The start of that at Little Moons was the way we would evaluate recipe development – we would do sensory panels externally. Then we graduated to doing concept tests on new pieces of product development, which we do quantitatively. When you’re trying to launch a significant piece of new product development (NPD) or a new ad campaign that involves some capital, people want you to do some quant or qual work to make sure it’s the right thing to do.
Fast forward to now and it’s a slightly different chapter. We’ve got lots of tracking set up and data feeds coming in: EPOS (electronic point of sale) feeds, panel feeds from the likes of Kantar. We’re doing quite a lot of evaluative research on NPD, as well as when we create big campaigns.
The next chapter will be more about upstream use of research. When I was at Cadbury, we invested a lot of money just understanding the market and being able to segment the market by occasion or need or audience. We’re in that stage now because we’ve gone through such rapid growth.
Market research sits within my team in a category management function. I don’t have anyone in my team who specifically looks
after quant and qual insights; that is reliant on me. That is quite common in businesses of our size, where very often the marketer will be tasked with being the person who does the colouring in and who looks after all the upfront consumer insight that feeds into the business strategy.
That means I rely heavily on third-party agencies or consultants that I trust. I have a trusted qual researcher and a tracking partner that offers a cost-effective way of making sure that I’m doing my brand tracking well. Plus, I have a quant partner who can go, “here’s a brief” and they will make that happen in the correct way, rather than all the mistakes that I would inevitably make if I was to do it myself.
The key thing is knowing what the right solution is to the needs you have, so you’re not just thinking, “Oh, I should probably do some tracking” or “I should probably do some focus groups” – that’s just too focused on what the solution might be.
For example, in the case of tracking, the need in my business is to demonstrate the consumer franchise that we are building in certain markets and the effectiveness of our marketing activity in growing that
funnel. Decide on the right tool according to the need you have and then link that to the degree to which it needs a specialist set of experiences to do it accurately. Because, honestly, bad insight is worse than no insight.
When we were starting out the insight budget was zero; I had to persuade my founders it was worthwhile. It is hard to show a direct return on investment, but if you can show why the pieces of insight are going to impact the decisions we make elsewhere in the business in a positive way, it is easy to sell that.
Equally, I think you get to a stage quite quickly where you can find yourself investing in stuff without the clarity on the problem you are looking to solve or illuminate. That’s when you get the output that just sits gathering dust on the PowerPoint shelf, which was interesting in the moment of the debrief, but then never really goes on to impact. Those are the things you need to be alive to when you are a medium-sized business, because that’s wasted money.
My main bit of advice is to get your head into the market rather than into your customer base. That’s specific to mediumsized businesses like us because they are often using insight to chase growth. The point of insight is for you to get a much better understanding and feel for what’s going on in the market, and then to bring that in through action that the business can use to target the growth you are after. That’s the leap any business needs to make.
You cannot take the research and simply debrief via email to your stakeholder. It needs to be embedded
Claire Rainey, Virgin Media O2
niche category and need to understand your audience, you’re going to have to pay.”
Research also shouldn’t be done among current customers only. Farquhar recalls how Little Moons used to gather customer feedback from, for example, its pop-up concessions, and treat that as insight. And while it was valuable, it told him nothing about how the company could expand beyond its current market.
“The customer feedback we got was really valuable, but it told me next to nothing about how we’re going to grow the business over the next three, four or five years. The only way we were able to get to how we are going to grow the business is by understanding the market, who is buying products like Little Moons and which groups we think we can legitimately win with. It’s only by thinking about what research is going to get me closer to the market, rather than existing customers, that you sense the value coming in.”
That’s where many medium-sized businesses – as well as the market – are moving. It’s not just about understanding what consumers are thinking, feeling and doing now, but about what they might think, feel and do in the future.
Advances in technology, particularly artificial intelligence, are helping. Ostler says Kantar is using data science and AI to predict consumer reactions. For example, its LinkAI product can look at advertising and predict what people’s responses will be. “One way to use all this amazing data, once a business has enough traction with it, is to use it in a predictive capacity,” she says.
In the end, good market research should help a business make good decisions. It takes considerable time and money to do well, so the results need to be worth it.
Sampling, as Tenzer has already pointed out, can be expensive, but so can bringing in the expertise needed to conduct the research. Many businesses think they can do this on their own, but Ostler, Tenzer and Farquhar caution against this for all but the most basic research. “The best thing to do is work with people who understand your business but aren’t invested in it,” says Tenzer.
At Virgin Media O2, a blend of in-house expertise and specialist agencies – from one-
person consultancies to the bigger market researchers – are used. It decides who to use on a case-by-case basis.
The company carries out smaller or more tactical work itself with a team trained in questionnaire design, moderation, sampling and execution. Claire Rainey, its head of research and insight, wouldn’t suggest doing this in-house unless the team has the training. For larger pieces of work, such as pricing or brand tracking, it uses agencies.
The cost means getting something meaningful out is paramount. Businesses should not be asking “nice-to-have questions” that yield little for them, believes Rainey. Companies also need to ensure results are communicated and necessary changes made.
“You cannot take the research and simply debrief via email to your stakeholder,” she adds. “It needs to be embedded. There is a big role here for facilitating change, relationship management and influencing for impact.”
For Farquhar, the impact is seen in the making of investment decisions. When he joined, he had to make the case for market research in a new business. He argued that if the company didn’t measure what it was doing and how well it was performing, it would have no idea how to make better decisions. He says it is now “hooked”.
“The great thing about insight in a medium-sized business is that when you finally persuade the business it is worth investing in, it can get hooked on it quite quickly,” he says. “There is something incredibly interesting and releasing and curious about hearing from genuine people, and how that influences your thinking around the business.
“The next stage is to use market research to identify where our source of growth is going to come from. We’ve gone through such rapid growth, but now we need to stimulate the next wave of that. Really understanding where the opportunities lie is the primary use of research.”
Market research, then, is pivotal not only to understanding your current customers and market, but where you might need to go next. As Tenzer says: “Market research should be the foundation on which you build your business.”
FRONT FOOT FORWARD
Serie A was the top football league in the world in the 1980s and 1990s. Players such as Diego Maradona, Marco van Basten and Paolo Maldini enthralled football fans around the world.
But in recent years the league has lived in the shadow of other competitions, notably the English Premier League, which has grown its global TV audience rapidly.
Now Serie A is fighting back. To do so, it is not relying on the action on the pitch, but marketing. Here, we speak to Michele Ciccarese, the commercial and marketing director of Serie A, about the key pillars of its strategy and what he thinks is required for effective marketing.
Go where the customers are Serie A is determined not to focus on just its loyal fans in Italy. It wants to grow its revenues and TV audience globally. So it has opened offices around the world to expand its commercial partnerships. For example, it has established a US office in New York.
“We used to sign a deal then walk away and wait for the next bit,” Ciccarese says. “You could never generate a relationship that is going to let the product grow. It’s like when you plant a seed and you never put water on it – you will never get the fruits.
“What we have in New York is an office that speaks daily with our broadcaster in the US, is developing CSR [corporate social responsibility] activities and is working every single day with all the 20 clubs [who
How the Italian football league, Serie A, is using marketing to grow its audience and not just relying on what happens on the pitch
GRAHAM RUDDICK
play in Serie A] on any project they might have in North America.”
Seek partnerships
Serie A’s partners include media companies that broadcast the matches. However, it is also looking to do promotional work with organisations that have similar expansion ambitions, such as the NBA, the American basketball league.
“Partnerships are key to everything that we do because with a proper partnership, there can be cross-marketing activities,” Ciccarese says.
“We had Alessandro Del Piero [a retired Italian footballer and TV pundit] with Kareem Abdul-Jabbar [a former basketball player] in Abu Dhabi for NBA games. We were creating content to speak to a completely different fan base in a completely different part of the world. But we both had the same objective because the NBA and Serie A need to grow in the Middle East. And it was also benefiting us in the US and the NBA in Italy. You need to create a proper cross-marketing strategy that is focused on a win-win approach. That is what we’re doing with every single partnership.”
Understand where your target audience is and how they are spending their time
Ciccarese says that Serie A does not see its competition as other football leagues, but anything that takes up someone’s time. So it has sought to understand what its target market is interested in so it can work out how to get them to spend time engaging with Serie A, such as watching matches. “The competition is anything that can grab the attention of people.
The key point of the countless amounts of research and analysis that we do is the data and insights we have on people of all ages, from generation alpha to baby boomers.
“The key attention and passion points for people are basically sports, music and food. When you look at the fan base in the US, the research can tell you that there are 33 million soccer fans in America. They all watch the Premier League and they might watch other leagues. But if you look at the data properly, there are also 54 million Americans who would like to go to vacation or travel around Italy. Now, if we can find a way to catch their attention through the country itself, that can actually tap into the objective that we have. It’s about involving and engaging with a new audience in order to reach a wider audience, which is not just core football fans. That’s exactly the job we have to do.”
Learn from what others do “The very first thing that we did was a full deep-dive and benchmarking on all the other top leagues,” Ciccarese says. “We looked at the best practices, such as how the American leagues create a proper collective approach (among all the teams and stakeholders). One of the things that I’m the happiest with is that once or twice a month, the 20 commercial or marketing directors from the Italian football clubs work together to look at our needs and do a proper assessment. Projects cannot be done by the league alone. If the clubs don’t provide you with the best players or the access that you need [for marketing campaigns], it will never happen.”
Your customers are impulsive, not calm decision - makers
Behavioural expert Richard Shotton explains how to exploit the innate bias of humans
Behavioural science is the study of how people actually behave, rather than how they claim to behave. There’s a broad idea, summed up brilliantly by the Princeton psychologist Susan Fiske, who says people are cognitive misers. Her former colleague Daniel Kahneman put it wittily when he said: “Thinking is to humans as swimming is to cats.” We can do it, but we would rather not.
We don’t make most commercial decisions, in B2B or B2C, in a thoughtful, considered way but in a rapid, impulsive fashion. And those decisions are made by using rules of thumb. From a business or marketing perspective, those rules of thumb are prone to biases. However, if you’re aware of the biases when designing a product or comms, you can work with human nature rather than against it.
Behavioural science is just a giant catalogue of what all those biases are – and there are thousands of them. The benefit to a business owner is if you have a challenge, one of the fastest ways to come to a solution is to match an existing bias to the problem you have.
Let me give you an example. On your website you list products that have run out. Behavioural science can tell you how best to do that. There’s an experiment by Robert
Peterson at the University of Texas where he gets more than 1,000 people to go on an e-commerce site to try to buy a few things –and one of the items isn’t there.
Sometimes that last item is labelled as out of stock, sometimes it’s labelled as sold out. What Peterson finds is if you label the item as out of stock, people are much more irritated than if you label it sold out. There’s nothing magic about that, it’s just that if you say out of stock what you’re drawing attention to is that you’ve mucked up on the logistics. If you say it’s sold out, you’re drawing attention to the fact that it’s a popular product.
Everyone who runs an e-commerce site has to label products that aren’t there. It’s no more expensive to label it in the psychologically powerful way than the psychologically poor way. And you don’t even have to go out and do the research; Peterson has done it for you.
There are multitudes of people who are dedicated to this field and spend their time summarising the work. I’ve written two books on the subject, there’s the Rory Sutherland book Alchemy, and Blindsight by Matt Johnson. Hours of work has gone into picking which studies are most useful for companies.
Business leaders still have to go out and learn about the field, but it’s something
that rewards that effort. Behavioural science is brilliant because you learn about a study from the 1930s and it’s still relevant today. That human operating system, the way the brain is wired, is not changing.
One of my most interesting findings was around concrete versus abstract language. This is really useful when trying to sell. If you write in an abstract way, people can understand you, but they find it very hard to remember. The task for any communicator is to take the abstract concept that your company delivers, such as its high quality or premium value, and translate it into concrete language.
That’s based on a 1972 study by Ian Begg, of the University of Western Ontario, where he reads out 22 phrases. Half of these phrases are abstract, for example basic truth, and half are concrete; they’re a tangible thing people can visualise, for example, square door.
What he finds is that people can, on average, remember 9 per cent of the abstractions, but 36 per cent of the concrete words – that’s a fourfold difference in memory. So many businesses, especially medium-sized businesses, talk about how they are high quality, premium, trustworthy. Yes, the audience can understand that, but they’re never going to remember it.
The Pratfall effect
Research by psychologist Elliot Aronson showed that if you admit a flaw, you become more appealing.
That has been applied by arguably the world’s greatest brands in their advertising.
For example, Stella Artois’ “Reassuringly Expensive”, which admits its pricing; Guinness admitting it is slow because “good things come to those who wait”; Volkswagen’s “Ugly is only skin deep”.
That principle, beautifully expressed by all those different copywriters, is at the heart of half a dozen of the greatest advertising campaigns.
But while the principle is important, it still needs to be executed. With the Pratfall effect you can either have a brilliant way of delivering on it or a mediocre one.
What businesses must do is translate that into concrete language. That’s something Apple does brilliantly. When it launched the iPod it didn’t talk about five gigabytes of memory, it talked about having 1,000 songs in your pocket. Now you can picture a pocket, whereas a megabyte is far too abstract to stick.
Friction is another interesting one. Everyone knows that if you make someone go through 15 pages of form-filling, you’re not going to get the same conversion rate. But friction puts people off more than we expect. Most businesses don’t put enough time, money and effort into going through the customer journey, identifying even the smallest barrier and resolving it.
Behavioural science can affect anything from strategy and targeting, to creative and media planning, to e-commerce. But if you wanted to pick a place to start, I would begin at the point of sale.
If you try to change your creative strategy based on some of the principles, you’re not going to know whether it worked for a year and a half. Plus, it will be quite hard to be clear about what was it that drove the success because it’s not just the insight that matters, it’s the expression.
A better place to start is something very quantifiable, such as average sales on a website or conversion rate on a product.. For example, there’s lots of work that suggests people don’t respond to price in a rational way, so test some of those principles on your website.
One example is temporal framing, which is the repeated finding that customers focus on the headline amount too much, but not enough on the unit of time. That means they think £365 a year is expensive but £1 a day is cheap. So, if you’re selling anything over time – insurance, a mobile phone, gym membership – don’t say it cost £30 a month, say it costs £30 a month and that is £1 a day. It’s a tiny tweak, but it reduces price sensitivity.
The other classic example is based on an idea called extremist aversion. If you have
When Apple launched the iPod, it didn’t talk about five gigabytes of memory, it talked about 1,000 songs in your pocket
a basic offering and a premium offering, you might get a roughly even split in buying between the two. If you then introduce a third, super-premium offering, even if no one buys it, it has value. That is because it causes a migration in purchasing from the basic package to the premium one.
What this shows is that people don’t judge prices just in relation to the benefit they get from a product or service; a lot of the willingness to pay is what they compare it to. That idea has been proven in popcorn in cinemas, beers in bars, coffee in coffee shops, electronic items and professional services – and it’s something most businesses can easily add to their offering.
After that, the world is your oyster.
As told to Sarah Vizard
Clockwise from top:
Stella Artois, Volkswagen, Guinness,
Trendspotting
Gut feeling and a keen eye for customers has helped Must Have Ideas go from homebased start-up to an online success story
JOSH DORNBRACK
Must Have Ideas is one of the fastest-growing online retailers, shipping around 7,000 items a day, with products ranging from mould-cleaning brushes to adjustable tables. It hangs its customer proposition on two bold promises: if it’s not delivered within two working days, it’s free; and a no-questionsasked, 100-day money-back guarantee.
With a 4.7-star rating from 115,000 reviews on Trustpilot and a 4.7-star rating from 6,000 reviews on Google, it seems to be working. Customer traction and loyalty saw it achieve £26.8m in sales last year. This does not happen without an understanding of it customers and knowing how to maximise a sales funnel.
Amy Knight began Must Have Ideas with her husband, Rob Knight, and Chris Finch. The trio had worked together at Ecoegg, a laundry egg business Rob co-founded.
After Rob sold his share in 2018, the couple saw first hand the power of digital marketing and were inspired to launch their own venture. Amy and Rob went to the US on holiday and sourced their first product: Hygiene Hero. What made this antibacterial
sponge stand out? “We had previously worked in cleaning products,” Amy says, “so there was a comfort zone about it because we knew how to sell it. But we thought it was really clever and innovative and had loads of USPs for us to work with. It was also small. So when cash was tight, it was easier to freight, ship to customers and store in our spare room.”
With an enormous warehouse in Snodland, Kent, space isn’t an issue these days, which is a good thing considering the company sells more than 200 different items. What makes a good product? A mix of gut feeling and experience goes a long way, says Knight. “If it’s on every aisle in Tesco, it’s probably not the product for us. We want something that people may have not seen before so when they see our video on social media, they say ‘Oh, that’s a great idea’.”
Since the start of Must Have Ideas in 2018, the company has developed a community that looks forward to the six new products it launches every month. Must Have Ideas has more than 200,000 followers on Instagram and more than 360,000 on Facebook. Understanding the needs of customers sometimes means that the products they
source aren’t always new to the market. Knight says: “It’s obviously got to solve a problem, but it also has to be really demonstrable. Because of the way we sell, we’ve got to be able to create compelling videos or it just isn’t going to work.”
Social media advertising is one of the main focuses of the company – it pays around £1.5m a month to Meta. Where some may lean towards using an agency, Amy says they like to keep things in-house. “We’re control freaks at heart. At an agency, you’re just another client. At the end of the day, it’s our business and our brand and nobody cares about it more than we do,” she explains.
Amy admits that, like all business owners, she hasn’t always found it easy to give up control. “When you’ve done something for so long,” she says, “it’s just so hard to just go, ‘Yeah okay, you’re responsible for that now’. Especially with Meta ads, for example. How they perform is literally the difference between us making or losing money.”
However, she credits her two co-founders for making the job a little easier, especially because each of them is responsible for their own area of the business. This collaborative
culture has been cultivated over a period of time, but most importantly, the whole team is open to testing and trying new things. “As a business, we’re constantly testing ads, website changes, emails… everything,” Knight says. “We empower people to speak up and give their ideas a go. This has meant that there are a lot more suggestions in the building and in the business.”
Amy’s main tip to leaders when it comes to maximising a sales funnel is: test. “You’ve got to be open to blowing it all up and starting again,” she says, “but whatever the data is telling you, that’s what you’ve got to move forward with.
“We’ve had various tests where we’ve though ‘Really? I don’t like the look of that so much.’ But we have to go by the data. Sometimes it depends: do you want a nicelooking website or a website that converts? You can’t always have both.”
Whatever they are doing is clearly working – the company expects to hit its goal of £60m turnover this financial year. Amy Knight and her team are a serious case study of how to identify consumer trends and maximise a sales funnel with in a must-have fashion.
You’ve got to be open to blowing it all up and starting again, but whatever the data is telling you, that’s what you’ve got to move forward with
Amy Knight
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Gen Z ushers in the end of the untouchable boss
CASPAR LEE
Co-founder of Influencer.com and Creator Ventures
Since the dawn of civilisation, people have organised themselves into hierarchical structures. Societies and organisations have both admired their rulers and despised them. Leaders were more separated from those who followed them and would have found it easier to control their public personas before social media came along to break down the third wall.
A PR crisis for a leader once meant that a journalist from one of a small number of media companies had a negative story. The leader may have had a chance to manage or mitigate the scandal from behind closed doors with their PR team.
Today, there are no gatekeepers who control the narrative. Anyone can bring their issues to the court of public opinion. If a leader in a PR crisis replies with a carefully managed statement, written by a team of lawyers, it usually adds fuel to the fire.
Take the situation with YouTuber Jimmy Donaldson, better known as MrBeast. His PR crisis, over a series of alleged scandals, started online but with so many clicks up for grabs has spilt over to mainstream media. Donaldson is the founder and chief executive of MrBeast, the world’s biggest YouTube channel, and has built a massive media company and FMCG brand, working with Amazon Prime and Walmart.
How Donaldson handles the allegations will be crucial not only for his reputation but also for the confidence of his investors and the morale of his employees. He cannot afford to curate an overly polished statement; people are too savvy for that now.
The changing expectations of leadership are not just being shaped by external audiences, but also by the workforce itself. Generation Z, which makes up more than 25 per cent of people working today, is driving a shift in how leaders manage the way they are perceived in their businesses.
Gen Z employees have a sharp nose for insincerity and don’t buy into leaders who stick to a script. Growing up with unprecedented access to information and behind-thescenes content, they demand transparency and authenticity. They have little patience for cringe-worthy company values that don’t align with reality.
For chief executives, this means that the old playbook of top-down communication and tightly controlled messaging is no longer effective. Gen Z want leaders who are approachable, honest and willing to engage in genuine dialogue. They expect them to acknowledge challenges and be transparent about the path forward. Anything less is seen as a waste of time and, worse, as a sign of dishonesty.
In 2018 Mark Zuckerberg was viewed by many as Silicon Valley’s biggest villain, while
never answering questions directly. Now, he’s a cool hydrofoiler who wears chains and cracks jokes on podcasts. As the meme goes, he went from the guy who would steal your data to the guy who would steal your girl, and did this by seeming more authentic.
Through our venture fund, we have been lucky enough to work with some of the most impressive chief executives of our generation. These modern leaders highlight how leadership is evolving. They communicate with their employees in accessible and transparent ways.
They openly discuss business challenges, share their plans and invite feedback. Importantly, they don’t pretend to have all the answers or to always be OK. This openness builds trust, as employees can sense when a leader is being genuine versus putting on a facade.
In this new era, leaders must be genuine, admit when things aren’t perfect and actively seek input from all levels of their organisation. As the workforce changes with gen Z an even larger cohort, these qualities will only become more critical.
Chief executives who can adapt to these expectations will not only navigate crises more effectively, but will also build stronger, more resilient organisations. The era of mythical, untouchable celebrities and politicians is over. The same holds true for chief executives.
The key to understanding all your customers as you grow
An excerpt from Buyer Personas, Revised and Expanded: Gain Deep Insight Into Your Customers’ Buying Decisions and Win More Business (2024)
by Jim Kraus and Adele Revella
Companies tend to start out with a fairly clear picture of their buyers. Entrepreneurs are usually prompted to start a company when a personal experience reveals a need that isn’t being met. For a while, their intimate knowledge of that problem fuels the small team they build to bring the solution to market.
Everyone is invigorated by that vision, and although the company remains relatively small, it is likely that each member of the team has regular contact with customers. But as successful enterprises grow, their employees begin to specialise. Gradually, yet inevitably, internal dynamics begin to impact decisions. Marketers in particular are likely to be cut off from the customer interactions that would help them to understand their buyers and what affects their decisions.
If the founding executives are currently leading your company, they may not understand why you feel the need to interview your buyers. Or they may direct you to the sales teams who meet almost daily with buyers to understand their concerns and win those deals. In fact, there is no denying that salespeople know more than anyone else about the buyers in their individual accounts.
Should you hear that the company’s internal knowledge of buyers is sufficient, it is best to avoid resistance. Instead, work toward finding common ground. If your stakeholder says, “Research is unnecessary; we already know our buyers,” begin by accepting their offer to share their expertise.
“That’s wonderful,” you should tell the stakeholder. “This may save us a lot of work.” Follow this by setting a time for a meeting where you can learn as much as possible about the buyers. Explain that you will conduct a mock buyer persona interview, in which the stakeholder will role-play the part of the buyer.
Not surprisingly, any such interview will be prone to some bias, and the insights are highly unlikely to be representative of the market as a whole. But it’s also possible that the stakeholder knows the organisation’s buyers well and can be helpful to you.
During the mock interview, watch for any holes in the story or look for moments when the stakeholder begins to veer into a sales pitch rather than channelling an authentic buyer’s voice. For example, someone who is accurately role-playing a buyer would have a balanced perspective of your solution.
If your buyer-expert gives a response that sounds as if they are reading your marketing
collateral, you need to call them on it. “Hold on, John,” you should interject. “Are you sure you are actually staying in role here? This sounds awfully optimistic. If all the buyers think the way you’ve been speaking to me right now, why aren’t we winning every deal?”
As the meeting continues, ask the stakeholder next to take on the role of a buyer who failed to buy your solution. This exercise will reveal the degree to which the stakeholder is aware of buyer criticism and the barriers that are hindering sales. Don’t be surprised if the sales expert tells you that buyers are choosing others because your solution is too expensive.
You’ll want to respond by saying, “That’s interesting because we know that people choose solutions based on value, not price. Can you tell me what the buyer thinks about the fact that we can do [unique capability]? What do you think we would need to do to explain how our solution delivers enough value to justify the premium price?”
Stakeholders who encountered difficulty answering your questions objectively will now realise that there are aspects to the buyers’ mindset they don’t know. A better appreciation of the insight the buyer persona methodology can reveal should make them far more receptive.
IN SHORT Six must-reads
Nudge: Improving Decisions About Health, Wealth and Happiness (2022)
by Richard H. Thaler and Cass R Sunstein
First printed more than 15 years ago, Nudge… offers fresh insights on decision-making in areas such varied areas as Covid-19, personal finance and climate change. It reveals how certain and unconscious biases often lead us to make poor choices, affecting our health, wealth, and happiness. Thaler and Sunstein demonstrate with wit and clarity how understanding human thinking can help guide better decisions without restricting freedom of choice.
Revenge of the Tipping Point: Overstories, Superspreaders and the Rise of Social Engineering (2024) by
Malcolm Gladwell
Twenty-five years after The Tipping Point, Malcolm Gladwell’s new book revisits the concept of epidemics and explores how we have learnt to manipulate the spread of ideas, viruses and trends with mixed results. He delves into topics such as Los Angeles’ bank robbery crisis, the concept of the Magic Third, and the connection between big cats and teenage suicides. Gladwell emphasises the increasing complexity of today’s epidemics and the moral responsibility to handle tipping points wisely to create positive change.
Ninja Selling: Subtle Skills. Big Results (2017)
by Larry Kendall
Larry Kendall turns traditional sales methods on their head by introducing a science-based system that delivers consistent results regardless of personality type. The book teaches readers to shift from chasing clients to attracting them by asking the right questions and actively listening. It offers a step-by-step guide to enhance sales effectiveness, increase income and improve overall quality of life through personal mastery and purposeful living.
Contagious: Why Things Catch on (2013) by Jonah Berger
Wharton Business School marketing professor Jonah Berger reveals the science behind why certain products and ideas become popular, debunking the myth that advertising alone drives success. Berger’s research highlights six principles that make content go viral, showing how social influence shapes our choices and behaviour. Packed with actionable techniques, this book is recommended for anyone looking to make their product or idea widely shared and talked about.
Noise: A Flaw in Human Judgment (2022) by Daniel
Kahneman, Olivier Sibony and Cass R. Sunstein
This book is an exploration of the variability in human judgment that leads to inconsistent decisions in fields such as medicine, law and food safety. It illustrates how identical cases often receive different outcomes based on factors as arbitrary as the time of day or the individual making the decision. Drawing on psychology and behavioural economics, the authors explain the impact of this “noise” and offer strategies to reduce it, improving decision-making across various domains.
Product-Led Growth: How to Build a Product That Sells Itself (2019) by Wes Bush
Wes Bush reveals the flaws in traditional software as a service (SaaS) growth strategies and offers an innovative approach. By making your product the key tool for acquiring, converting and retaining customers, you can significantly reduce acquisition costs and scale your business efficiently. Packed with practical frameworks, real-life examples and actionable advice, this book has been declared essential reading for SaaS founders, decisionmakers and marketers looking to implement a product-led growth strategy and achieve sustainable success.
John Cleese
Lessons on unlocking your inner creativity
Ed Smith
The debate over specialisation versus breadth
View from the North
Forge Holidays on building a business to last
My Business Leader secret
Eventbrite and Hims and Hers CEOs share their advice
Emma Jones
On the need for transformative technology
Zara Nanu
How AI is reshaping the workplace
Catherine Baker
Performance and wellbeing are inextricably linked
66
Niki Turner-Harding
The business benefits of a strong DEI programme
Jake Humphrey
Second-best should be good enough
Member stories
Why one firm still believes in the power of paper
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Creating value
Comic genius John Cleese has some straight-talking advice on how to unlock your creativity and boost your business
JOSH DORNBRACK
You might think the brilliant satirist who conjured up so many of the funniest moments ever screened in television and film had some of his talents nurtured at school. But no. He says he never heard a teacher utter the word “creativity” –a void in his youth that has seen him now develop a passion for talking about it.
John Marwood Cleese – whose O levels were in the drier spheres of maths, physics and chemistry and who read the sober subject of law at Cambridge – believes that creativity is something that can be taught. Or, more accurately, people can be coached in how to create the circumstances in which they can become creative.
The man who helped develop the unforgettable worlds of Monty Python, Fawlty Towers and A Fish Called Wanda, as well as playing roles in the James Bond and Harry Potter films, says creativity doesn’t just have a place in music, film and dancing. It’s just as important in the world of business, from developing pricing and marketing strategies to problem-solving and iterating your business offering.
His book, Creativity: A Short and Cheerful Guide, is just 103 pages. That means it can be read in around 40 minutes, which is exactly what Cleese wants. It aims to provide advice on how to bring creativity into your
life. “I read a lot of books by psychologists, and they include a lot of stuff like, ‘If you travelled more in your youth, you are more likely to be creative’. This is very interesting, but it isn’t useful unless you can move backwards in time,” he says.
The book sets out two distinct ways of thinking, inspired by an idea by cognitive scientist Guy Claxton called “Hare Brain, Tortoise Mind”. The hare brain relies on reason and logic – purposeful thinking. Claxton gives examples of a mechanic working out why an engine will not fire or a student wrestling with an exam question. The tortoise mind is less purposeful, more playful, leisurely or even dreamy. For Claxton, this ruminating and problem-solving is where the magic happens.
At the core of getting in touch with this tortoise mind, Cleese champions the concept of play. “Picture small children playing,” he says. “They are so absorbed in what they are doing that they are not distracted, they’re just... exploring. Children at play are totally spontaneous. They are not trying to avoid making mistakes. They don’t observe rules.”
Play is an unbroken period of focus on anything. Problems with your business, fresh thinking on untapped markets, product improvements or creations… the lot. You may doubt its efficacy but out of
it iconic works, such as Monty Python skits and movies, were borne. In a lecture on the topic, Cleese credits the process for giving him an edge over others. “I was always intrigued that one of my Monty Python colleagues, who seemed to be more talented than I was, never did produce scripts as original as mine,” he said.
“I watched for some time and then I began to see why. If he was faced with a problem, and fairly soon saw a solution, he was inclined to take it. Whereas if I was in the same situation, although I was sorely tempted to take the easy way out and finish by 5 o’clock, I just couldn’t. My work was more creative than his simply because I was prepared to stick with the problem longer.”
However, one element is vital to making this process work: time. Cleese famously took six weeks to write a single episode of Fawlty Towers, but that was the dead-
line he’d set and that was to be obeyed. It provides the parameters for this idea. What comes with a looming deadline provides the conditions that creative people thrive in, as Cleese puts it, “the vague sense of worry we all get when we leave something unresolved”.
“The most important thing I learnt in 20 years,” he says, “is that if you have a decision to take the very first thing you must do is ask when does this have to be made? It might be tomorrow, it might be in three months, but don’t take it before then. You may get new ideas or you may get new information, so why hurry it?”
Don’t be afraid of the unknown either, he says. “When we’re trying to be creative, there’s a real lack of clarity during most of the process. In our education, we are always told you have got to be clear, but you only have to be clear at the end. You’ve got to allow for confusion and then, I believe, if you live with that and think with it, your unconscious will start sorting it out. Then, one morning, you’ll just wake up and think, ‘actually, that’s really the best solution’.”
The biggest killer of creativity is interruption, warns Cleese When scaling a business, your
life is practically nothing but interruptions. Research has shown that after an interruption, it can take eight minutes to regain your previous state of mind and up to 20 minutes to return fully to a state of deep focus. He encourages leaders to say, “I don’t want to be interrupted unless there’s a fire”, to allow them to think about the bigger picture or ruminate over a problem that needs solving.
This sets the tone for the rest of the organisation as well. “If you have a control freak at the top, then it’ll be control freakery all the way down,” he says. “The people at the top always think they have to be controlling, and that control works against creativity, so you should learn to trust your employees.”
Cleese concludes the book with hints and tips he’s learned about his own writing ideas, but which are also analogous to other professions and fields. One of them is especially poignant for life and creativity: “The anthropologist Gregory Bateson once said, ‘You can’t have a new idea ’till you’ve got rid of an old one.’ This insight helped me to view my fallow periods as preparatory to the more fertile ones. When the creative juices are not flowing, don’t beat yourself up and wonder if you should retrain as a priest. Just sit around and play. Getting discouraged is a total waste of your time.”
So why not give it a go? The book might just be that positive and uplifting 40-minute read that your business needs to helps you create something new within it – and within you, too.
Creativity: A Short and Cheerful Guide, Hutchinson Press, is available now from £7
photo: Getty Images
ED SMITH ON DECISION-MAKING
Great success can come from sharpening your focus
The journey of England bowler James Anderson has lessons for business leaders on career development
Many of us form our worldviews around our own capabilities, ever vigilant for patterns of success that validate personal decisions. “He posits a principle,” in Nietzsche’s unimprovable barb about Wagner, “where he lacks a capacity”. I remember hearing a professional coach explain why he had signed a new player: “He was the closest thing I could find to me.” All too understandable; but the coach didn’t last long.
The opposite way is more useful: learning from people who find great success at the other end of the career spectrum. So those of us who have sometimes argued in favour of breadth and “portfolio careers” should take extra care to study the shape and trajectory of James Anderson’s remarkable achievements as an England cricketer. Anderson retired this summer with more Test match wickets (704) than any fast bowler in history. He made his debut at 19 and retired at 41. No second strings required, and not many off-days either. Just persistent, record-breaking excellence for 188 Test matches.
There were several layers to Anderson’s specialisation.
First and most obvious, as the opening bowler and number 11 batter, no-one bowled ahead of him or batted below him. Nothing grey or confusing about those facts. And they suited Anderson’s understated perception of how things ought to be: clarity, accountability, responsibility. If you compiled a showreel of all the numerous times he bowled the first ball of an innings, you would see how rarely he missed his spot. A job to do, a tone to set — the band’s metronome. His former captain Alastair Cook always said that Anderson’s ability to begin each new innings with an accurate, perfect-length ball would only be appreciated after he had gone. Making precision look easy is a classic trick achieved by the greats.
A second layer emerged in terms of formats. Of cricket’s three main formats (Tests, one day internationals and Twenty20), though proficient at them all, Anderson played exclusively in Tests for the final nine years of his career. As his focus narrowed in terms of formats, his returns improved still further: his career during his years as a “Tests-only” bowler reads 324 wickets at an average of 22.62 (which is almost off the spectrum).
The third aspect of Anderson’s mastery was the
evolution of his archetype. Anderson’s hyper-consistency in terms of output was powered by his stranglehold on accuracy.
One of the most interesting data projects I have experienced in sport was England cricket’s deep dive into understanding the archetypes of bowlers who make a real success of Test cricket. Imagine four different continuums: speed, accuracy, movement, bounce. Now imagine all international bowlers are plotted along each of the four lines. We learnt that bowlers ranked in the world’s top 10 truly excelled at two or three categories. One on its own was rarely enough.
This has repercussions in terms of trade-offs. For example, it’s a common oversimplification to say that speed is a pre-requisite at elite level. Yes, gaining speed might help a bowler become more likely to succeed in Tests. But if extra speed is achieved at the expense of, say, both movement and control, then the bowler could end up below the line in two categories – and hence less likely to achieve a sustainable “Test match archetype”.
In Anderson’s case, the final shape of his career looks very different from its early direction. As a young prodigy, Anderson was known
as a wicket-taker, but at the expense of keeping the runs down. That changed over time. He sustained the ability to create movement in the air and off the pitch, but he added the art of grinding down opponents through relentless accuracy and starving them of scoring opportunities. Anderson added a dimension, but without compromising elsewhere. Anderson became a patient torturer, always playing the long game, within the individual match and the arc of his own career.
Just like a business has to grow into its brand, every great athlete evolves into a performance DNA that ends up looking natural (and inevitable) once achieved. Through a mixture of trialand-error and self-awareness, they become themselves.
I saw Anderson up close near the very beginning and
then near the end of his extraordinary journey. After a decade mostly away from cricket doing other things, I came back into the game aged 40 as an England selector. By chance, before the first match back at the sharp end in 2018, I found myself having lunch with Anderson in the pavilion at Lord’s Cricket Ground. He relayed a conversation he had just had with his friend and colleague Stuart Broad. Broad had asked Anderson if he had encountered me before; Anderson replied that we’d played three Test matches together in 2003.
It was a time so distant that the year was almost out of sight from the perspective of cricket in 2018 — even for a knowledgeable elder statesman such as Broad. From my perspective, 2003 did seem like a lifetime ago — certainly two or three careers ago. But
Anderson still had another six years (and 173 wickets) to go at the top of the same mountain. Because success flows from the perpetual and chaotic interplay of talent, effort, resilience and chance, the hardest thing is assessing where we stand within the body of our own work. About to break through? Already plateauing? Or worse than that?
Some people tilt towards finding their purple patch and sticking it out. Others can tire of the last thing and switch focus. It’s worth remembering that both intense specialisation and curious restlessness bring their own risks. I suspect most people move up and down the continuum, figuring it out as they go. Only the very few, like Anderson, find that one style offers the perfect solution.
Ed Smith is director of the Institute of Sports Humanities
James Anderson walks through the guard of honour on his final test appearance ahead of day three of the first Test Match between England and the West Indies in July
SMEs can only transfom with transformative tech
EMMA JONES Founder and chief executive of Enterprise Nation
Technology has the potential to boost our economy, fuel growth and give the new government a lifechanging level of flexibility in terms of policy and reform.
According to the International Monetary Fund (IMF), if there were a broader adoption of artificial intelligence, for example, we could see an expansion to the UK’s economic growth of up to 1.5 percentage point per year during a decade.
This is at a time when the World Economic Forum puts the UK behind many developed nations in the world for tech and ICT adoption – at 31st
As the government prepares to place economic growth front and centre by introducing a modern industrial strategy, it needs to tackle a key issue.
To achieve the current administration’s brave new level of change ambition, we must quickly find a way to increase digital uptake and skills among small business and increase investment in digital tools among the UK’s SME community.
This is something my company Enterprise Nation knows a lot about. Early-stage, micro and start-up entities make up 96 per cent of UK businesses, and there are around 6 million of them.
We work with these organisations every day. There is a real hunger among them to grasp emerging technologies,
but these are also busy firms who have faced a relentless mix of challenges in recent times.
Many are preoccupied with trying to achieve their potential with the resources at hand –and digital upskilling is another item on a long to-do list.
While the heads of the Department for Business and Trade and the Department for Science, Innovation and Technology are preparing for action, the chancellor Rachel Reeves’s first speech pointed to some fundamental priorities: a key part of their plans will be working with the private sector to deliver investment, innovation and growth.
I have always felt that supporting our business community should not solely be the responsibility of the public purse – the private sector also has a lot to give and gain from small companies that are allowed to thrive.
This is the guiding principle behind what we do. By actively involving the private sector, we have been able to develop technology solutions that can enhance business support.
We have worked with Google, Cisco, Vodafone Business and Sage to build a free-to-use tech hub that accelerates the digital adoption among SME’s and boost the nation’s productivity, and at no cost to the government, either.
It’s called the ‘One-Stop Shop’ – a platform created alongside the Mastercard Center for Inclusive Growth. Analysis shows it has delivered
an 11 per cent boost to digital skills of the 3,500-strong test group, rising to 17 per cent among founders from ethnic minorities and 24 per cent amongst female founders.
This three-year digital programme was delivered without any financial input from the businesses using it, and it has produced measurable results that could inform and shape future iterations.
One of the platform’s key principles is that everything should be in one place. We pulled in more than 1,000 peerrated resource programmes from accredited providers in order to reach a diverse audience of entrepreneurs.
Skills and confidence as well as investment play pivotal roles in how technology transforms organisations, and we understand that any attempt to enforce or nudge adoption must be delivered with robust digital guidance and support.
Digitalisation underpins every single growth priority as well as the fundamental changes outlined in Labour’s plan for small business: re-thinking business rates; increasing SME procurement; sorting out late payments.
Even the VAT threshold cliff edge – a thorny issue that is often blamed for curtailing ambition – could be easily smoothed using technology.
In short, the solutions exist, the private sector is willing to invest and the transformative technology is ready to be unleashed. Let’s do business.
Artificial inclusion: How AI is reshaping the workplace
As artificial intelligence (AI) and automation evolve, they will transform the global workforce significantly. According to a report by Goldman Sachs, AI could affect 300 million jobs worldwide, either by eliminating them or altering their nature.
This will have far-reaching implications not only for the labour market but also for pay equity and economic activity, with different consequences for men and women due to various factors, not least because of occupational segregation.
Impact on jobs
AI and automation are expected to revolutionise various industries by streamlining tasks, enhancing productivity and reducing the need for human work. The Goldman Sachs report highlights that jobs in sectors such as administration, customer service and manufacturing are most vulnerable as they can involve repetitive tasks, which AI systems can do more efficiently.
The automation of routine tasks disproportionately affects jobs typically held by women, such as secretarial work, data entry and retail positions. AI can automate scheduling, data management, and customer service interactions.
However, in many cases, AI will alter the nature of existing jobs, requiring workers to adapt to new technologies and develop new skills. This
transformation may open opportunities for those who can upskill into new roles, but it also risks exacerbating existing inequalities, particularly if access to training and education is uneven.
Effect on pay and economic activity
On one hand, AI has the potential to boost productivity and economic growth, leading to higher wages and increased job opportunities in certain sectors. On the other hand, the displacement of jobs in sectors retail, administration, and manufacturing could lead to wage stagnation or even declines, particularly in jobs that are easily automated.
Wage impacts will not be evenly distributed between men and women. For instance, in the healthcare sector, which employs a high proportion of women, AI could automate routine diagnostic tasks, potentially reducing the demand for certain roles while increasing the demand for AI specialists and data analysts, roles which are currently maledominated. These positions command higher pay due to their technical nature and scarcity. In the UK women make up approximately 22 per cent of the workforce in data and AI roles – less than the global average of 26 per cent.
Gender differences and the influence of AI AI’s influence on jobs is not limited to job displacement and
wage impacts; it also extends to how AI is integrated into daily work processes and how men and women use AI differently in their jobs. Research shows that men and women often approach technology differently due to varying levels of access, confidence, and encouragement to engage with technology from an early age.
The gender gap in AI usage is also complicated by the underrepresentation of women in AIrelated fields. This discrepancy means that women may have less influence about how AI is developed and implemented, leading to AI systems that may not fully account for gender differences or that perpetuate existing biases. For example, AI systems used in recruitment or performance evaluation could inadvertently reinforce gender biases if they are trained on biased data.
Being fair and inclusive
The rise of AI and automation is set to reshape the workforce in profound ways, with significant implications for jobs, pay and gender equity. As AI continues to advance, it is crucial to address the challenges posed by occupational and task segregation to ensure that the benefits of AI are shared equitably. This includes investing in education and training to help workers adapt to new roles, promoting gender diversity in AI-related fields and developing AI systems that are fair and inclusive.
ZARA NANU
Serial entrepreneur and a member of the women’s leadership board at Harvard Kennedy School
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Prioritise wellbeing to win
CATHERINE BAKER
Founder and director of Sport and Beyond
Every four years the Olympic Games bursts into our lives, as it has this summer, leading for those with a self-professed lack of interest in sport to become experts in the “full twisting double pike”. When we hear the stories around some of the athletes, we can understand the words of Mel Marshall, coach to British swimmer Adam Peaty, double Olympic gold medal winner and world record holder in the 50m and 100m breaststroke: “I always describe sport as the university of life… because you have everything: extreme challenge; success; defeat; times when you make super progress; and other times when things go stale.”
We can see the culmination of huge amounts of hard work and dedication, but is that it? Or is there another area missed from an outsider’s point of view?
Mike Gervais is a performance psychologist who has helped Olympic athletes win gold, and chief executives take their companies to the next level. On a recent podcast, Gervais said that in both corporate and elite sport, he spends more time talking about recovery than about working hard. His clients are driven –they understand hard work already – and many in the corporate space have put themselves into the red zone with the unsustainable way they work. “Hustle hard” isn’t a message they need to hear.
Elite sport has understood for some time that wellbeing and performance are inextricably linked. Lizzie Simmonds, chair of the British Olympic
Athletes’ Commission at the British wrote in 2021: “Ask any athlete in the world and they will tell you that performance and wellbeing are not mutually exclusive; they are, in fact, entirely symbiotic.”
For long-term, sustained success, you must get recovery right. One of the common refrains I hear in my coaching work is: “I haven’t got time to exercise/think of myself/go for a walk each day/breathe…”
This drives me mad, especially when all that is required is a simple shift in mindset: “I am so busy that I must find time to exercise/think of myself/go for a walk each day/breathe…” And for those in senior leadership positions this is even more critical: a leader is responsible for a lot of people and a lot of outcomes. What can help?
As I describe in my book Staying the Distance, Dame Jessica Ennis-Hill, Olympic gold medal winner and “face” of the London 2012 Olympic Games, had a superpower. It wasn’t her ability to perform (although that was exceptional); it was her ability to prioritise her time.
How good are you at prioritising your time? As with Ennis-Hill, the starting point comes from absolute clarity on your role and what it involves. Can you write down, in one or two sentences, what your role entails? And can you then list what “activities” this includes?
What are the elements that you need to work on? And what should you not be spending your time on? Ennis-Hill didn’t try to sort her physio herself, or her nutrition, or her training schedule. That was the role of
others. She understood her role and her priorities, and how she needed to be spending her time.
Sport shows us the way in terms of focus on sleep, nutrition and hydration. But sport also shows us manageable, daily habits which can translate well into the corporate world.
Research by sports psychologist Dr Jim Loehr on elite tennis players showed the impact of ‘micro-breaks’. Loehr uncovered the secret ingredient that top players were using, and what they did between points and games. It highlighted the benefit of taking micro-breaks during the day – short intervals where you give your mind and body the chance to recover and reset. It might be one minute between calls or meetings, involve some breathing exercises, stretches, or just making a cup of tea, but the cumulative effect regularly through the day, day after day, can have a big impact on your ability to sustain performance.
Olympic cycles are every four years. Athletes are not ‘on’ that entire time, they periodise their effort based on training, competitions, recovery and peaking at the right time. In the world of business, this is just as crucial. I advise clients to colour code their diaries – red for when they need to be at their best, blue for ‘business as usual’, and green for recovery blocks. For many this is game-changing. Hustle, hard work, dedication – you have this. But if you don’t put enough focus on recovery and your own wellbeing, you won’t be able to perform in the long run. And it really is a marathon, not a sprint.
An inclusive culture boosts results and gets better staff
NIKI TURNER-HARDING
Improved innovation, enhanced productivity, higher employee engagement: the business benefits of a strong diversity, equity and inclusion (DEI) programme speak for themselves. And companies are finally hearing the call to boost representation across their workforces.
Research from Birkbeck, University of London, shows that 92 per cent of UK employers have an DEI policy in place. However, we don’t really know how many are tapping their programme’s full potential, moving from tickbox compliance to creating truly inclusive cultures.
Part of the problem is the subjective nature of inclusion. While diversity can be viewed as a measurable goal – such as employing a particular percentage of workers from under-represented groups –inclusion is a continual process of shaping a supportive, welcoming and enlightened workplace. Without a specified endpoint, how do you know you have succeeded?
Embedding an inclusive mindset requires practical measures. Proactive changes – diversity-friendly hiring, interviews and retention programmes – help business live and breathe inclusion.
Commit to inclusive recruitment
From advert wording to interview structure, how you take on talent is core to creating an inclusive culture. A June 2023
Recruitment and Employment
Confederation survey found companies are slow to change hiring practices. It showed that 60 per cent revised the wording of their job adverts to boost inclusion, up from 54 per cent in 2022. However, 49 per cent didn’t state their interest in hiring diverse candidates in job adverts and 56 per cent didn’t use a diverse interview panel.
Implement blind CV screening
Blind CV screening is a popular method of tackling unconscious biases, which are the engrained beliefs that drive managers to favour or dismiss candidates based on characteristics such as educational background, ethnicity, gender or age. Used with recruiter training, technology can boost the blind screening’s effectiveness. For example, software can hide sexual orientation, religion and ethnicity from hiring teams and flag bias in many job descriptions.
Structure interviews consistently
Structured interviews use preset questions, scoring rubrics and evaluation criteria to give candidates an equal chance. Skills-led tasks and assessments allow applicants to demonstrate their capabilities, as can asking the same questions in the same order, focusing on required competencies.
Diverse interview panels
Representative interview
panels – of various ethnicities, genders, ages and experiences – show your commitment to DEI and fair assessment. Create interview teams that encompass a range of ethnicities, genders, age groups and seniority levels, giving applicants visible proof of inclusive culture.
Also, provide regular training for your HR team and staff, enabling colleagues to challenge and balance each other’s perception. Lastly, regularly rotate the members of interview panels in order to prevent groupthink.
Remove bias from your recruitment practices
Training your recruitment team helps to eliminate preconceptions that restrict access to top talent. You should focus on exercises to identify attitudes, assumptions and stereotypes, creative role-playing to highlight unintended bias, and solutions and mitigation strategies to help colleagues model and promote unbiased behaviour.
Improve retention with inclusive processes
If you’re experiencing high turnover, poor employee engagement or sluggish career growth, deeper issues could be undermining your hiring practices. Do your materials, new-starter training and settling-in processes promote inclusion? You should also review training and promotion opportunities to ensure clear progression paths.
Country head, UK and Ireland, at Adecco
Second best should still be seen as a success
JAKE HUMPHREY
This summer, I spent a lot of my time watching Euro 2024 and the 2024 Olympics in Paris. The general conversation around how we frame success interested me.
The disapproval that Gareth Southgate received for taking England to successive Euro finals – being beaten on penalties by Italy three years ago and being beaten by a single goal against Spain this year – was incredible. I had a message from someone very high up in the England football camp following the defeat. The phrase they used was: “We just about managed to get through with all the criticism.”
Afterwards it was the turn of the Olympic Games. I was amazed by the number of times I heard commentators saying that some results were “only a silver medal”. Framing that being the second-best person in the world at your chosen discipline is something that deserves any sort of negativity is shocking.
Research by the University of Iowa found that people are more disappointed with silver than with bronze. The reason for this is psychological. If you win a bronze medal then your brain goes: “Oh wow, I almost didn’t win a medal at all. How cool, that I managed to get a bronze one.” Obviously if you win gold, you’re delighted. But
the most dissatisfied person on that podium is the silver medal winner. They are the person who thinks: “Oh, a little bit more and perhaps I could have got myself a gold medal.”
The reason why we need to reframe the way we talk about success in sport is not necessarily for the people who are competing now, but for the next generation. Simone Biles, the gymnast, felt the need to go public to talk about her frustration at athletes being asked what comes after a gold performance. “You guys really have to stop asking athletes what’s next after they win a medal at the Olympics,” she posted on social media. “Let us soak up the moment we’ve worked our whole lives for.”
If you look at the stats, Lewis Hamilton, Tiger Woods and Roger Federer all realised that life is a losing game. Federer gave a great speech recently
where he said he won 80 per cent of his singles matches but only 54 per cent of the points. So 46 per cent of the points that Federer played in his career, he lost.
The reason why it’s important to talk about this is because if those 46 per cent of points had derailed Federer, or he’d seen them as a failure, he would never have gone on to win the other 54 per cent. It’s an outlook that’s made him probably the greatest tennis player of all time.
So my message from this summer of sport is to look at the fact that just competing is a success, getting close to victory is a success and, at times, failure is a success.
The number of athletes who have not achieved what they wanted this summer but have said it’s fuelled them to fight harder in the future should inspire us all.
Host of the High Performance podcast and co-founder of Whisper Group
Great Britain’s Katarina Johnson-Thompson reacts after winning the silver medal in the women’s heptathlon at the Paris Olympics
FORGING AHEAD
Forge Holiday Group is heading for unicorn status and taking on international tech rivals
CHRIS MAGUIRE
Graham Donoghue is the guitar-playing beekeeper at the top of one of the UK’s biggest names in holidays – yet you probably haven’t heard of him.
In an industry dominated by heavyweights such as Airbnb and Booking.com, the Chesterheadquartered Forge Holiday Group has established itself as a big player which takes 3.5 million people on holiday every year.
The short-stay specialist provider owns a range of brands, most notably Sykes Cottages but also Forest Holidays, UKCaravans4Hire and New Zealand’s leading holiday home business Bachcare.
The company manages 33,000 properties, handles 700,000 annual bookings, has 1,800 staff and transacts more than £500m a year.
Forge Holiday Group might not be the first name on most people’s list of potential unicorns, but it is widely thought to be on the cusp of achieving the $1bn valuation.
Donoghue, the man tasked with overseeing that journey, is
a self-confessed data nerd and part -time beekeeper who loves tech, evidenced by the fact that he wears a Garmin Fenix 6x watch to monitor everything from his daily step count, calories burnt and sleep statistics. He also has an Aktiia blood pressure monitor and a Whoop band health tracker on his wrist to measure stress levels, skin temperature and heartrate variability. Donoghue likes to know what’s going on “under the bonnet” of his health and he takes the same approach with business.
One of the centrepieces of the Chester office is a giant real-time data wall; the chief executive wants his entire workforce to be aware of the company’s performance. The information includes everything from the company’s Net Promoter Score, to call waiting times, when and how people book, and holiday hotspots.
“It’s about visibility and making sure the whole organisation knows what’s going on and remembers that we’re taking millions of people on holiday,” says Donoghue.
“One key trend is that people are booking later. At some times
in the year, you can get 40 per cent of your bookings within four weeks of departure. We have people book today to leave tomorrow and the next day. The other thing we’re seeing is the length of stay is narrowing. Plus, the proportion of bookings from people with dogs has gone up to around 40 per cent.”
Donoghue became chief executive of Sykes Cottages in 2016, having previously held senior roles at MoneySuperMarket Group and Tui. When Forge Holiday Group was formed in 2023 after acquiring Sykes, Forest Holidays and other brands, he was the obvious choice to fill the seat.
It has been an eventful journey. In 2019 Vitruvian Partners took a majority stake in
The thing I’ve learnt in this business is as you scale and get bigger, you really have to look hard at everything you do and ask: ‘Is it built to last?’
Graham Donoghue
the business for a reputed £400m. A year later, Covid sent the travel industry into a tailspin, but staycations soared, with 82 per cent of Brits holidaying at home in 2022.
Forge Holiday Group was able to take advantage of the fact it has largely built its own technology, but Donoghue says there’s zero room for complacency.
To illustrate the point, opposite the data wall is a display of 40 mobile handsets from across the ages, including a version of the first mobile phone that originally cost more than £7,000 and had its own power pack.
Donoghue says the display of ancient phones highlights the importance of innovation and how established brands can quickly become obsolete if they don’t evolve.
“The thing I’ve learnt in this business is as you scale and get bigger, you really have to look hard at everything you do and ask: ‘Is it built to last?’” he says.
“My biggest FOMO as a group CEO is artificial intelligence. AI is not going to replace the 1,800 staff I have but we need to be leaning into it to create that superpower and create competitor advantage.”
It’s why the company has invested millions in a team of hundreds of engineers, data scientists and product managers. That team has developed technology products including a real-time management tool called Bidpro, an in-house revenue management system called Prism and a forecasting tool called Sphere to help them make better business decisions.
“I would describe us as a technology company masquerading as a holiday company,” says Donoghue. “Technology makes it easier for people to do their job.”
However, he insists the company’s secret sauce is its people. Guests are asked how they slept after their first night in the property and a dedicated in-house team reviews everything that detracts from a positive experience.
“If you’ve got a property and you want to do pretty much everything yourself, other than the marketing, you go to Airbnb and Booking.com,” he says.
“If you want somebody else to do everything for you – that can range from meeting and greeting, cleaning the property, linen, maintenance, dealing with all the guests, revenue management, marketing services, to health and safety advice – you come to us because we’re professional property managers.
“A lot of our owners want revenue and bookings with no hassle. They want to know somebody is looking after the property and dealing with things when they go wrong. That’s what we do.”
Forge Holiday Group is the UK’s largest property manager in terms of holiday units. The company has invested millions in its consumer apps and Donoghue believes in it so much, he has entrusted it to market his own holiday home in Anglesey, north Wales.
“I’m a huge believer in the phrase ‘eat your own dog food’,” he says. “They don’t treat me any differently.”
The company is also a registered BCorp and raises around £200,000 a year for good causes. Its most recent trading update saw a 22 per cent increase in group revenues, with underlying adjusted profit for the year broadly flat at £60.7m.
Forge has plans to invest more than £150m over the next three years in developing its portfolio of UK locations and properties, technology platform, customer experiences and owner services.
Donoghue, who has a jar of honey produced from a local beehive that the firm sponsors on his desk, said he won’t be distracted by the sweet talk of achieving unicorn status.
“We are a business that thinks for the long term,” he says. “If at the end of the next investment cycle, which is inevitable because in private equity there’s always a cycle, we end up having a valuation that makes us a unicorn then fine, but that’s not a driving factor in our business.
“We turn up to do a good job, look after our customers and create value. We don’t stand at the top of the mountain and say: ‘Look at us, we’re a unicorn’.”
Top to bottom: Graham Donoghue addressing a Scale Green sustainability conference; a Forest Holidays ranger shows children the undergrowth; a cottage in the Forest of Dean
Andrew Dudum
BUSINESS LEADER SECRET
Co-founder and chief executive Hims & Hers
Andrew Dudum founded Hims & Hers in 2017. The online platform provides access to prescription and over-the-counter treatments for conditions customers may struggle to talk about openly, such as hair loss and erectile dysfunction. It has more than 1.7 million subscribers and hit $870m (£657.5m) in annual revenues last year. When the company went public in 2021 it was valued at more than $1.6bn (£1.2bn).
One of the reasons that Dudum was able to scale so rapidly was because his team laser-focused on testing customers’ appetite for products and was flexible about its product offering. His team relentlessly tested what didn’t work to grow fast, he explains. They followed the principle before you build it, prove it. They would create ‘coming soon’ landing pages online, Dudum says, to see how much customer interest potential products would generate. Or they made online waiting lists to quantify demand. This would tell them if the product offering,
such as a particular new treatment, was worth pursuing.
Years ago, Dudum says, entrepreneurs would build companies upside down: agonise over the brand name, patent it, build a website, choose the colour and then launch to a market where “nobody cares”. Inevitably, it would be the second iteration of the product that would stand a better chance of success. That whole process might take a year, but his team tries to condense that into a week, using all the user-testing tricks at the modern digital entrepreneur’s disposal.
If you have a high failure tolerance while you scale, and an intelligent approach to failure and feedback, you can brew success remarkably quickly, he maintains. It’s all about measuring the clicks and being obsessed with customers’ desires. He honed this approach working at Atomic, a hybrid investment company that funds start-ups, and works closely with founders, helping them to test out ideas.
Entrepreneurs and business leaders share their personal advice with Dougal Shaw in our weekly video series. In this issue: how companies can connect with customers in the digital age
His secret: surround yourself with people smarter than you and test your ideas relentlessly before you build them
Julia Hartz Co-founder and chief executive Eventbrite
In 2006, Julia Hartz and two co-founders started a company in Silicon Valley that they hoped would shake up the world of ticketed events, using only the power of the mobile phone and the QR code. Eventbrite has since grown into a global platform that specialises in medium-sized events, from dance festivals to professional networking meetings. When it went public in 2018, it was valued at more than $1.8bn (£1.36bn). Last year it issued more than 300 million tickets for 5 million events.
Hartz started her career as a television producer in Hollywood, working for MTV and FX Networks on shows as diverse as Jackass, Nip/Tuck and The Shield, before moving to San Francisco and launching her tech start-up with her future husband, Kevin Hartz. “I went from Hollywood to Silicon Valley because the speed was so gratifying,” recalls Hartz. “I could tell there was disruption on the horizon.”
The storytelling skills she picked up while working in television have been fundamental to her business success, she believes, especially when connecting with customers. This is because storytelling is the magic ingredient that allows you to define and enhance a customer’s product experience. It is especially important in the hospitality and events industry, believes Hartz.
“Running an event is an anxiety-ridden process,” says Hartz, “to host, plan, or even attend it is stressful, so the product experience we design has to say, ‘We’ve got you’. It’s nuanced and subtle, [often] about the tonality, but very important.”
Eventbrite’s platform lets you discover events in your area, generating a ticket on your phone as an attendee, but it also guides hosts in creating events. It’s an integrated, two-sided experience that is generating extra revenue opportunities. This aspect of the platform was also the
Her secret: hone your storytelling skills
key to propelling organic growth in the early days of the business. People bought tickets for events such as networking workshops for the tech industry in the Bay area of California and, in doing so, discovered the platform and used it to organise their own events. The idea spread to states such as New York before going global. This innate virality helped Hartz and her team to win over sceptical venture capital investors.
The Hollywood-honed craft of storytelling also helps her with another important management skill: internal company communications. Hartz still uses this to frame her interactions with staff. “Humans think about themselves first,
then their team, then their broader ring is the company, then the customer, then the impact on society, so I tell any story through those sets of lenses.” You need to think about your audience’s preoccupations and priorities, if your message is going to land – whether it’s your staff, your customers on your website, or a bingeworthy TV series, she suggests.
Her other key pieces of advice for aspiring business leaders are to “find co-founders with different superpowers [to yours] that don’t overlap and create a set of people you can seek advice from. And ask great questions of many people, don’t try to show how smart you are in your questions.”
THE POWER OF P PER IN A DIGITAL AGE
Online marketers call people who live offline ‘the unreachables’ but Dan Dunn has shown that direct mail can still hit home, writes Dougal Shaw
Dan Dunn is a firm believer in the power of paper promotion, even in a screenaddicted, digital age. Dunn and his co-founder Steve Kinder believe that marketers have a blind spot when it comes to direct mail, those promotional letters and leaflets that land, with a clatter and a thud, on our doormats. The entrepreneurs behind Paperplanes believe that e-commerce marketers need to wake up to the power of modern, datadriven and digitally informed direct mail. They set up their company to prove it Last year, Paperplanes was responsible for more than 2.4 million pieces of mail and its clients have included companies as diverse as Biscuiteers, Gousto, Good Housekeeping and the National Basketball Association. But it wasn’t the future that Dunn, now chief executive, imagined for himself when he entered the workforce as a graduate in the late 2000s.
An education from Tesco Dunn immersed himself in the power of customer data at the start of his career.
His first job when he left university in 2009 was working for Dunnhumby, which handled Tesco’s Clubcard loyalty scheme and was co-founded by Edwina Dunn (no relation). Excited by the rise of Facebook and Google and keen to explore the power of data-driven marketing, Dunn was originally disappointed to be set to work on Tesco’s postal marketing campaign for the Clubcard statement.
“It was a naive view,” says Dunn, “because working with Tesco showed me if you can drive data into direct mail, you will stand out on the doorstep. If it’s personalised and relevant, it will result in action.”
That action was easy to spot thanks to Clubcard data. Around 17 million people were using the cards and it was possible to track the transactions of nearly threequarters of those members in stores. The data proved that customer calls to action, triggered by direct mail, worked, says Dunn.
Data allowed them to test all kinds of ideas. What was the relative impact of “spend-threshold coupons” versus a simple voucher on a specific product, perhaps a treat such as a Ben & Jerry’s ice cream?
Would a customer in a certain income bracket be tempted by something in the more expensive Finest range? What kinds of imagery in the mail itself were more effective at prompting action — family friendly or product-focused?
Dunn’s work on the Clubcard opened his eyes to the power of direct mail informed by data. It also gave him ideas on how he could do more with it, if it became a dedicated service for businesses.
The reluctant entrepreneurs
In 2016 Dunn joined a print production company specialising in direct mail called Go Inspire. It was here that Dunn and Kinder started Paperplanes.
The chief executive backed their idea and gave them the chance to try it out internally as a small department with its own budget, like an employee incubator programme. This gave Dunn and Kinder the security of a regular pay cheque.
But it reached a “crossroads”, says Dunn, when it became clear the fledgling startup would have to be spun out if it was to progress. That meant Dunn and Kinder
would take the intellectual property and assets and go it alone.
says Dunn. This “bulk” approach meant mailshots were not personally tailored.
The Paperplanes approach was (and remains) very different. It sends out far fewer printed letters, but it targets customers based on online behaviour, which it gathers in a digital dashboard called “In Flight”.
The platform builds a specific customer profile by asking questions such as, “what kind of items have they put in their online basket before, but not checked out?” This can be compared to what other customers with similar profiles have bought, which might trigger a specific promotion. “What we’re aiming for is personalisation at scale,” says Dunn.
Email saturation
We wanted to take the best aspects of data-driven marketing and apply it to direct mail
Dan Dunn
“I completely lost my mind,” confesses Dunn, on his decision to take the entrepreneur’s path in his early 30s. “We had a decision to make because we didn’t see ourselves as entrepreneurs at that stage.
“My first child was born three months before that, it was a big decision. But my wife said, ‘If you don’t give it a go, you’re always going to moan about the fact you never tried it!’”. The launch date was April 2019.
Launching Paperplanes
Dunn and Kinder started Paperplanes believing they had the ability to help many companies with the lessons learnt working with Tesco. In the intervening years, e-commerce had taken off, so that almost every company had rich digital data about customers gleaned from their websites.
But direct paper mail remained almost forgotten, mentally consigned to a bygone, pre-internet era.
Their idea was to take modern digital analytics and apply this to paper in the post, to target people more effectively.
“We wanted to take the best aspects of data-driven marketing and apply it to direct mail,” says Dunn. “We believed that e-commerce businesses should have direct mail as part of their mix.”
In the past, direct mail was about volume and scale with a rock-bottom postage price,
Fast forward to 2024 and Dunn and his team see new opportunities for direct mail. Customers’ email inboxes have become “saturated” with digital marketing, says Dunn. People receive 10 times as many marketing emails today as they did in 2016, he says, and response rates have fallen as people get “email fatigue”.
At the same time, direct mail has some competitive advantages over digital channels. For email, phone calls or SMS, there is a statutory requirement for customers to “opt in” for permission to be contacted. “Direct mail is still an opt-out channel, according to the ICO [Information Commissioner’s Office] regulations,” says Dunn, giving marketers more flexibility.
Secondly, there is a general movement against activities such as online tracking, making it harder for businesses to establish individuals’ digital habits.
Let’s not forget either that some people simply choose to live quite happily offline. Digital marketers call them “the unreachables”, because you can’t email them if they don’t have an account.
But still, they do have a doormat that savvy businesses can land on.
Dan Dunn is a member of Business Leader. Our aim is to help mid-size CEOs and founders fast-forward their growth through peer-topeer networking, events and content. If you’re interested in hearing more about joining Business Leader’s membership offering, visit www.businessleader.co.uk/membership
Did you know that most medium-sized companies fail to grow into large ones? We’re here to change that
We help CEOs and founders turn their businesses into industry giants
A one-of-a-kind, peer-to-peer membership where diverse businesses learn, share and grow together
CRAIG WILMANN
Business Leader’s head of membership on the method behind what might seem like madness
Can we double the number of large companies in the UK?
Wait just a minute. Hold on a second. How on earth, with the best will in the world, even if the stars align and everything goes perfectly to plan, could a membership organisation possibly hope to double the number of large businesses in the UK?
Because that’s what Business Leader is aiming to do. We’re on a mission to increase the number of large companies in the UK from 7,500 to 15,000.
But what’s really going on here? Are we lying? Are we secretly developing a new form of artificial intelligence (AI) or nuclear fusion? Have we unearthed a secret supply of magic beans?
Well, no. We really do believe we can double the number of large businesses in the UK. We really believe we can unleash growth throughout this green and pleasant land. In fact, we’re confident enough to say we’re going to do it. And we’re going to do it by harnessing humanity’s greatest innovation. No, not AI. Nor nuclear fusion. We’re not even going to use magic beans. Despite countless technological developments, humanity’s greatest innovation remains our ability to talk to each other. But in the UK – and particularly in the business community – we don’t spend nearly enough time using this wonderful feat of human ingenuity. As a result so many of the secrets to business success
remain just that – a secret.
In the 1960s, Massachusetts was the world’s biggest tech hub, while Silicon Valley was barely known. Today, the Massachusetts tech hub is dead and Silicon Valley is, well, Silicon Valley. One of the key reasons for this is that businesses in Massachusetts were siloed – the offices were a mile apart, people drove to work. By comparison, founders in Silicon Valley mixed freely and shared ideas.
Today, much of the US is like Silicon Valley, whereas Britain is like Massachusetts in the 1960s. When two US CEOs get together, they ask: “How’s your business doing? What can I do to help you? What can you do to help me?”
When two UK CEOs get together, they ask: “What’s going on with this weather?”
In the US, there is an abundance of peer-to-peer business memberships where founders and CEOs share their ideas and concerns with a trusted peer group. But until Business Leader came along this practice was almost unheard of in Britain.
That’s why a US CEO is nearly twice as likely to scale a mid-sized business as their UK equivalent. And that’s why, if we can get this right, if we can change the culture in this country and get our best leaders to share their secrets with each other, if we can put our CEOs on a par with those in the US, we really can double the number of large businesses. That’s our mission. That’s our purpose. And that’s why you should join our membership. One day, historians may say that the difference between joining and not joining Business Leader in the 2020s was akin to the difference between being in Silicon Valley or Massachusetts in the 1960s.
So if you want to be a part of our ambitious, outlandish, but genuinely possible mission, please do get in touch today. You’ll grow your business. You’ll meet fascinating people. And best of all, you’ll get access to our secret supply of AI, nuclear fusion and magic beans.
To join, contact us at membership@businessleader.co.uk
South West businesses feeling buoyant
Despite the challenges, companies in the South West are feeling positive about the economy and the future
Imagine the south-west of England and your mind likely goes to Cornish beaches, Stonehenge and the wild landscapes of Dartmoor. Yet this corner of the UK is the fifth largest economic region with a GDP of £194m in 2022, according to figures from the ONS. It is also the fastest growing area outside London, with economic growth of 160 per cent between 1998 and 2002.
That means how businesses in the region are thinking and feeling matters. To understand this, the accountancy and business advisory firm Monahans, part of the Summer Group, has surveyed 300 companies of all sizes to recognise the challenges they have faced over the past 12 months and how they are feeling about the coming year.
Simon Tombs, managing partner at Monahans, says: “As the South West’s eading accountancy and business advisory firm, it is crucial that we keep our finger on the pulse of market sentiment. Monahans serves a wide range of businesses across multiple sizes and sectors, so the research provides us with comprehensive insights as to market confidence on as broad a basis as possible, over and above the unique challenges that our clients face on a day-to-day basis.
“Their needs are constantly evolving, and our services need to adapt accordingly. The research has also highlighted the areas in which businesses are in most need of support, so that we know which of our services are likely to be in greatest demand.”
A tough year for business
The research shows a tough year for businesses in the South West – as elsewhere. Inflation is cited as a challenge for two in five (42 per cent) of businesses and 40 per cent of those with between 51 and 250 employees
Businesses are feeling buoyant about the business market
Percentage of respondents, where one is very poor and 10 is extremely strong
The majority of businesses have not seen turnover or employee headcounts decrease in the past year
(medium-sized companies). Energy prices have been a challenge for 38 per cent, ahead of generating new business on 26 per cent, cashflow on 21 per cent and recruitment/retention on 20 per cent.
Yet despite these obstacles, 55 per cent of companies say they are in a better position than they were last year – although only 16 per cent would describe that position as “much better”. Some 47 per cent say turnover has increased, with just 19 per cent saying it has decreased.
Tombs adds: “It is indisputable that businesses of all sizes have faced significant challenges over the last 12
Businesses are largely optimistic – and they should be. Half of businesses reporting increased turnover in turbulent financial conditions
Source: Monahans
months, whether that’s inflation and changing customer behaviours, energy prices or other issues coming to the fore such as data management and digital transformation.
“However, businesses are largely optimistic – and they should be. Half of businesses reporting increased turnover in turbulent financial conditions is extremely positive, as it shows that they have been able to ride out some tough times and will likely make hay when the sun begins to shine again. Certainly, we are positive about the outcomes of our clients at Monahans and will continue to support them to manage cashflow, implement strong financial plans, be aware of changing market regulations, and retain optimism.”
On recruitment, 34 per cent have increased their headcount while 16 per cent have reduced it. Among those companies that saw a reduction, the average was 18 per cent. The number that has made staff redundant is slightly higher – at 28 per cent.
An optimistic future
Over the next six months, companies continue to see inflation and rising operational costs as a challenge, cited by 28 per cent of businesses. Energy prices on 27 per cent, generating new business on 26 per cent, recruitment and retention on 20 per cent, and cashflow on 19 per cent remain concerns as well.
Yet businesses were confident that the general election would improve market conditions, with 14 per cent expecting them to get a lot better and 33 per cent a little better. Just 18 per cent expected them to get worse.
That resulted in businesses on average ranking the buoyancy of the business market at seven out of 10, where one is very poor and 10 is extremely strong. No business gave it a score of one or two, and little more than a third (37 per cent) ranked it one to six.
One in 10 (9 per cent) gave it the highest ranking and 10 per cent scored it a nine. Medium-sized businesses were generally a little more optimistic, slightly more likely to be in a better position than a year ago, less likely to have seen turnover decrease and less likely to have seen a reduction in headcount.
Tombs concludes: “Looking ahead, there’s an air of optimism across the market, and rightly so. If half of businesses can post a higher turnover than in the previous 12 months, amid a turbulent market in which we only narrowly avoided a recession, with cashflow and recruitment/ retention among other issues that have been affecting one in five business (as well as those mentioned above), then the future looks bright. And that was also reflected in the research, with most businesses believing that the market will improve – and they will be able to benefit.”
To find out more about Monahans and how it can help your business, visit www.monahans.co.uk
Gauging business sentiment across the South West
Simon Tombs, managing partner, Monahans
What are your top line takeaways from the research?
There’s no getting around the fact that the past 12 months have been challenging for businesses of all sizes, with rising inflation and increasing operational costs chief among issues that businesses have faced. A reduction in spending due to interest rates climbing above 5 per cent, the perfect storm of energy prices rising and businesses struggling to generate new business has only compounded issues.
However, it is far from all doom and gloom – quite the opposite. Businesses are reporting growth, with only one in five seeing a decrease in turnover over the past year, and that’s despite turbulent financial conditions. As the economy stabilises, we hope to see this number reduce.
How do you think businesses in the South West are feeling?
Challenges aside, market sentiment is largely positive. The findings on buoyancy of the market and turnover show a level of resilience that puts them in a good position to capitalise on improving market conditions.
How optimistic do you feel about the opportunities for businesses in the South West in the next 12 months?
Businesses foresee issues like inflation and rising operational costs continuing to pose problems but are largely confident that they will be able to navigate these challenges. There’s a general feeling across the South West t that market conditions will improve and that they will therefore be able to make hay when the sun is shining a bit more brightly.
We’d agree with this sentiment that there are significant opportunities available to the businesses that can focus on their financial planning, thus preparing themselves for anything that comes their way in the next 12 months.
What are the key things that will help businesses in this region grow in the next 12 months?
Unpredictability and uncertainty will always be part of running any business, but those that can control the controllables will be the ones to thrive. I’ve mentioned financial plans and those that can develop robust ones and effectively manage cashflow will fare well in the next year or so.
HEAD WEST FOR SUCCESS
Businesses are breaking new ground across the region but do they need to shout louder to get vital funding? Andrew Lynch reports
Some 20 minutes’ drive northwest of Bristol, Isambard-AI, one of the world’s fastest supercomputers is now online in its temporary home at the National Composites Centre. Thanks to a £225m government investment, Isambard-AI will be ready to drive a range of scientific breakthroughs.
At its offices in Exeter and Newquay in Cornwall, Intelligent AI, a start-up that helps the insurance industry to recognise risks around commercial and residential property has just received £1m in funding to scale up the business nationally and into the US.
Two stories at different ends of an industrial revolution, both sparked by AI: a giant government-backed project and a commercial start-up. Both at different ends of a region, the South West, which feels left behind when it sees the clout of its regional rivals, the Northern Powerhouse and the
Midlands Engine. Yet the South West is an anomaly. It can be hard to detect any thread between the Isles of Scilly and Swindon, or sense of regional identity. Historically, the region that includes Bristol, Exeter, Plymouth and Bournemouth has been lumped together following the creation in 1999 of the now-defunct South West England Regional Development Agency.
But what comprises the South West now, and should it include the West of England, that is Bristol and Bath and their environs?
Northern Powerhouse and Midlands Engine are unified by their big cities and industrial muscle. On the peninsula the focus is on blue and green (marine and ecological), while in Bristol it is advanced manufacturing, professional services, deep tech and creative industries.
“It’s definitely not one economic geography,” says Paul Swinney, director of policy and research at the Centre for Cities
think-tank. “You could make an argument probably for at least four, if not more.
Stuart Brocklehurst, deputy vicechancellor for business engagement and innovation at the University of Exeter, doesn’t see it as a competition with other regions. “The Northern Powerhouse contains Manchester, Liverpool, Leeds, Sheffield, Hull, Newcastle, York. It’s not comparing like with like,” says Brocklehurst, who sits on the board of Great South West, a public-private sector partnership for Cornwall and the Isles of Scilly, Devon, Dorset and Somerset.
He sees the geography as split in two: broadly, the peninsula and the West of England, which has a combined authority and its own mayor. “They are quite distinct,” Brocklehurst says. “If I go down the hill to the train station from the university, I can be in London almost as fast as I can be in Bristol. The peninsula naturally looks more to London because you can be there pretty much as quickly. Bristol is obviously a major city, the peninsula is overwhelmingly rural and has challenges around the periphery.”
Travel and low density of population are hurdles to education and training. But Brocklehurst has plenty to boast about. “Exeter is home to more climate scientists than any other city in the world. Beijing is the second,” he says. “You’ve got the Met Office and the university. The university has more of the top 100-ranked climate scientists than anywhere in the world.”
Further west, Brocklehurst points to Smart Sound Plymouth, the testing ground
for marine products and services, and the Plymouth Marine Laboratory, leading research into a sustainable ocean.
“You have an incredible set of assets around things which are going to be defining a lot of the future world,” Brocklehurst says.
The potential is not limited to the sea. You can discover the county’s tin mining heritage at Helston’s Poldark Mine. The country’s only school of mines is based in Camborne. Meanwhile, Cornish Lithium is working to build a domestic supply of lithium and other battery metals, which are vital for the decarbonisation of the automotive industry.
At Plymouth Science Park, clean tech start-up Altilium is working on recycling old EV batteries instead of sending them to landfill in China. Its first recycling plant, on Teesside, was announced in February.
Tourists may bring in almost £2.5bn a year for Cornwall but Brocklehurst says: “We need to get past the bucket and spade image to see that there’s really important work being done here.
“Difficulties in communications? Yes, particularly as you head further west. I can be on the motorway in 10 minutes. Obviously, the motorway stops at Exeter. From Plymouth, the largest city in the UK without a motorway, and more so in Cornwall, you have the challenge that everything slows down, by road and rail.”
Dan Pritchard, co-founder of Tech South West, a partnership of tech clusters running from the Scillies to Bristol, understands the drawbacks but sees an upside. “It does
Bristol and Bath collaborating with Cardiff and Cheltenham can do a lot for the UK as a science superpower
Nick Sturge, Techspark
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your team up for success with
One of the threats we will continue to see is how we bring funding for start-ups coming out of our universities
Richard Bonner, West of England LEP
make it hard when you’re trying to engage with government, regional government, local government,” Pritchard admits. “But we find it quite an advantage as a business sector representative, as an ecosystem player and as a cluster group.”
For instance, Microsoft is a business partner of Tech South West, but the tech giant doesn’t have time for lots of local engagement. “Coming in at a regional level,” says Pritchard, “you can start to have conversations about innovation or productivity and what the opportunity is.”
Others don’t see it that way. “You’ve got this dilemma,” says Nick Sturge, an entrepreneur who put Bristol’s Engine Shed innovation hub on the map, and now chairs Techspark, a local not-for-profit network. “Some people say you’ve got to look east to London from the West of England – and not look south or west. I don’t think that’s the right answer. No one has really cracked the problem, but the industrial base across Western Gateway – ie, looking west – has far more legs to it as a powerhouse concept than the South West – looking south.”
Sturge sees the Western Gateway, a partnership of local authorities from South Wales and the West of England, as a more effective grouping. “The South West as a whole is completely incoherent,” says Sturge. “Cornwall is a great place, there are some great pockets of entrepreneurial activity, but what is the contribution to the UK? Western Gateway, by working together, can contribute more to the UK than the greater South West.
“Bristol and Bath collaborating with Cardiff and Cheltenham can do a lot for the UK as a science superpower. The risk with the whole South West is that the whole is less than the sum of its parts.”
But he does remain cautious about the possibilities. “Western Gateway hasn’t
fulfilled its full potential yet,” Sturge says. “That doesn’t mean it can’t.”
Sturge attributes current successes – of the kind that have led Bristol to be branded as Silicon Gorge – to the legacy of pathfinders such as Inmos, a chipmaker based in Bristol and Newport which was seeded by the Callaghan government and offloaded by Margaret Thatcher.
“The legacy of Inmos is that it bred an entrepreneurial culture,” says Sturge. “It celebrated people leaving to start up their own businesses or setting up the UK offices of a foreign tech company.”
Richard Bonner, who chairs the West of England Local Enterprise Partnership, sits on the Western Gateway board. He sees it as joining the dots. “We’ve got cybersecurity that comes down into Bristol and through the University of Bristol, linked up to Cheltenham and the Golden Valley development, and across into South Wales.”
He adds: “One of the threats we will continue to see is how we bring funding for start-ups coming out of our universities.”
He cites Northern Gritstone, which backs spinouts from Manchester, Leeds and Sheffield. “That’s the sort of thing we need to start to develop for ourselves in the rest of England or in the wider region,” he says. “We don’t have a venture capital institution.”
Stuart Harrison, director of FinTech West, which covers the whole South West, says: “The number one challenge is access to funding.” So does the region need an investment vehicle supporting spinouts?
“It would certainly help,” says Harrison.
The real battle is to be heard in Whitehall and Westminster. As Stuart Brocklehurst says, “We are constantly having to shout and to make sure that there is awareness of what we’re doing and of the role we play.”
They also have to hope that the government is listening.
When thinking about physical shops, which retailers do you admire and why?
I would pick out three. First, Next, because it has evolved its model across many years. The Next Directory was a development from just having stores, but it is under the current CEO Lord Wolfson that the business really started to take off. It has developed to have other company’s brands in its stores and a great online offer, while also offering total platform, which provides fulfillment for other retailers’ products. It’s a fantastic model.
Second, B&M. It is a very successful discounter that has gone from a half-a-millionpound acquisition back in 2004 to a business worth £5bn today. It has done that by sticking to a very simple model: selling well-known grocery brands at a discount alongside impulse purchases imported from China such as pet and gardening products at low prices.
Finally, Games Workshop, a business that engages with hobbyists. It has micro stores on secondary locations in major
Ask Richard
town centres. That is a model that is really working.
What do you think is important to make sure that bricks, clicks and paper can all work together. Does every business need all three of them?
It’s important that they’re all joined up, a good example is click and collect. Second, is making sure that the pricing online is the same as the pricing in store and, third but most importantly, that there’s a smooth customer journey.
The way to test that is through mystery shopping, making sure people are looking at those different customer journeys. Those journeys need to work for all types of consumers, whether they start online or in store.
In terms of do they need all three, yes, they do. Businesses that have all three will do much better. Does that mean they have to have their own stores? Absolutely not. There’s a model called strategic retail partners, which is about having wholesale relationships.
That could involve an online business that sells its products via another retailer – for example John Lewis. That’s a way of showcasing the products. Often, that retailer might not have the full range of products or the right sizes, so that means that many of those customers go online and go to the business’s own website, rather than to the John Lewis website. It’s a win-win and it means that it’s showcasing those products to a new audience.
A good example of this is Passenger Clothing. That business can track where it has its products distributed in other people’s stores. In those postcodes, it is generating more business direct to its website than those where it doesn’t.
Do you think direct physical marketing, for example doorto-door leafleting, is still as important given the ability to reach people through social media and the cost of printing?
I’m a big believer in direct mail. Because there are fewer busi-
Richard Harpin, the founder of HomeServe and Growth Partner and owner of Business Leader, answers your questions
Customer journeys need to work for all types of consumers, whether they start online or in store
nesses doing direct mail in this digital age, it means you can get a bigger share of the doormat. That’s important because then the consumer is more likely to read the materials, act on it, and purchase that product or service. The best example of that is Checkatrade, a business that I invested in and which I chair. In that business, we distribute individual versions of an A4 folded leaflet that has around 150 trades people listed in it with tracked telephone numbers. That generates a lot of business for those trades, but it also brings a lot of business to the Checkatrade website. That’s paper generating clicks.
Did you ever consider opening HomeServe shops or a physical location for consumers?
Yes, we did. We have acquired a couple of heating installation businesses in our Spanish operation, and they have heating, ventilation and air conditioning stores where people can go and look at boilers and heat pumps – and increasingly, that will include battery storage and solar.
That is a model that works well for Endesa, a major energy company in Spain, where its service-point stores that are run by some of its heating installers. We could very well open one or two stores in the UK under either the HomeServe or the Boxt brand, which is our online boiler, heat pump and solar installation business. That’s an exciting opportunity.
Is it sustainable for retailers to have no online offering?
I don’t think it’s sustainable either for physical retailers to not have an online offering or for online-only businesses to not have a retail offering.
There are probably more examples of online businesses that don’t have a store or sell their goods or services in somebody else’s store. But we don’t just need to look at individual stores, this could be concessions or even vending machines. There are several different ways to showcase products in physical locations.
I find it quite difficult to think of many examples that don’t have a full online offering.
B&M is one example where you can have products from the store delivered to your home, but it does not encourage that – it’s all about the in-store experience. Primark is the other example where they don’t have a full online offer – it’s only click and collect.
This is not just about product sales either, but also service sales. Going back to my Checkatrade example, maybe one day we could have mini home improvement fairs in local village halls so that we could showcase trades people operating in communities around the country.
Another example would be Peloton. It is an in-home exercise business but why wouldn’t it have its own gyms? If I’ve been working at home, then I probably don’t want to go and get on my Peloton exercise bike at home, I want to go to the gym.
But if I’ve been in the office all day, then I’m happy to go on my Peloton at home. Peloton used to have a lot of expensive retail stores, what it should have had was its own branded gyms, so it had an omnichannel offering.
Better-trained staff mean better results
Jonathan Bourne Damar Training
Standing out in a crowd: how
Clem Hobson
The Modern House
The medium-sized businesses driving the economy
Words: Pavlo Phitidis
Jonathan Bourne, joined by his former boss, Phillip Bennett, left corporate life and bought Damar Training, a small apprenticeship training provider.
Today, Damar has 65 people and nearly 1,200 apprentices across various disciplines. Bourne and his team have set a 20-month goal to double the number of apprentices on Damar’s books.
In a sluggish economy business leaders are turning to productivity enhancements to boost performance. But productivity
The residential property industry is highly competitive. More than 25,000 agencies manage about 1.2 million transactions worth more than £300bn annually, forcing them to try many approaches to win customers.
“We have differentiated ourselves through two acts,” says Clem Hobson, managing director of The Modern House. “First, we only work with owners of architecturally significant homes that offer design at their core. This is found in the property’s design approach to space, light, nature and
A car dealer puts its trust in family values
Paul Jaconelli Romans International
“I started life selling cars and still do it today, but I’m not alone any more,” says Paul Jaconelli, founder of high-end dealer Romans International, based in Surrey. “My son Tom joined in 2011 and runs the buying side. He is the next generation of Jaconelli to take Romans to the next level. It takes generations to build a pedigree brand.”
Tom will need to convince his father what that next step should be. “We live and die by how we buy,” Tom adds. “Every car we are offered is evaluated against a Romans
is hard to get right and depends on measuring and improving performance across all resources. Increasing skills and competencies for new and existing team members makes for an easy win.
Apprenticeships close skills gaps, leading to productivity gains, compounded by the energy, increased motivation, and new skills and ideas that apprentices bring.
“Today, we mostly deliver online, supported by high-quality learning resources,” says Bourne.
materials. These homes stand out; their owners care deeply about their living spaces and places. Next, our team of 65 across the country loves and appreciates design.”
The Modern House has built a media-led approach to growth. With 50,000 photos and videos across Instagram, 260,000 YouTube, and 70,000 Facebook followers, it has a stand-out position in a crowded marketplace. “Sixty-two per cent of all our business comes from subscribers to our content,” Hobson says.
standard that creates a curated, high-end experience. Our brand and reputation are generated from that experience.”
Quality stock and certainty of pedigree and condition are vital. Each successful sale builds trust, while a single disappointment can damage it.
What will Romans look like five years from now? “We are doing well,” says Paul. “Let’s recover some of the capital we have invested and then it’s up to Tom as the next generation in the business.”
THE VALUE OF KNOWING YOUR CLIENTS
Our advertorial on page 80 highlights how fluctuations in the market can impede or enhance the successes of Monahans’ clients and the importance of putting relationships at the centre of everything we do.
As accountants and business advisors, we work with each of our clients to help them plan effectively to achieve their ambitious goals. Each organisation is different, and our team invests a significant amount of time into fully understanding each client’s business and history.
This extends to asking for each client’s personal situation, for example establishing their age, if they are married, if they have children and where they live. This information may seem overly personal and invasive but to provide business guidance you need to have a grasp of someone’s personal financial situation. Information about what hardships they have faced and what they worry about can inform the type of advice you provide – and the way you deliver it.
To provide sound financial advice, you need the full picture: you cannot advise clients on one part of their business without understanding how it impacts another part. The more detail you have – for example whether the business’s goals are to consolidate, grow or even sell – the better you can tailor a service that considers their financial positioning as a whole.
As our research has shown, a turbulent market has presented businesses with a range of challenges over the past 12 months. This makes it more important to develop a close relationship with clients; failing to understand the context behind their business and their background is setting yourself up for a fall.
This should inform how you communicate with clients. For some of our customers, a more subtle and protective approach is effective, whereas others respond well to directness. But it should also inform the method by which you communicate: email, phone calls or in-person meetings. It all comes down to trust. We pride ourselves on knowing each of our clients so well that we can support, no matter the situation. In turn, clients place their trust in us to offer them the right advice and deliver it in the right way. From helping businesses make hay while the sun is shining, to guiding and advising amid the challenging issues we’ve seen in the past year, our relationships are the cornerstone of our firm.
If you would like support or to discuss your business journey, get in touch with our team of experts today
