Luxury and Aspiration

Wisdom Manifesto Principle 2: Be the Best at Something

The best way to align employees and management is to understand the benet that the business is trying to deliver to its customers. Only four types of consumer benets matter, and by extension, only four categories of value propositions work. Best Quality Richard Branson once commented that being the best at something is a pretty good business T! BES model. We couldnt agree more. Consider brands that set a standard, such as Louisville Slugger baseball bats or Stradivarius violins. You dont have to be a sports nut or a classical music acionado to be familiar with these brand benchmarks. Brands that set unmatched standards are often luxury brands; but even a less luxurious brand like Benjamin Moore can create a long-lasting value proposition by establishing a best-in-class quality reputation. Best Bang for the Buck Some consumers will always buy on price; still, best-in-class value doesnt always mean the lowest price, but rather the best quality-to-price ratio. One good example is JetBlue, a company that may not offer the cheapest or best in comfort travel, but that does a superior job of communicating its superior value relative to its price point. Chipotle, Ikea, and Toyota are other illustrations of best-in-class value, and through the years, theyve sustained their value propositions.

Alongside bang-for-buck players are luxury providers that dangle the experience of a gilded lifestyle to aspirational consumers. Ralph Lauren, Rolex, BMW, and Herms are among the most masterful purveyors of lifestyle luxury brands. While the luxury segment can take a hit during difcult times, consumers make their way back as the economy rebounds. Not to mention that many luxury goods consumers have ample discretionary spending, even during tough times. Must-Have
NE One of the most attractive value propositions we have seen and studied consists of the must-haves. These include basic goods, up to and including certain foodstuffs. At Thomson, we often talked about musthave content, without which business professionals simply could not do their jobs. One example? The critical legal information and tools Westlaw provides lawyers. As long as there is a case to be led, lawyers need legal information, and Westlaw is the leading source for that information.2 There will always be competition between the must-haves, but must-have market leaders ultimately win a great prize: mega value generation. W!

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Reach a New Level! Does your companys value proposition t in one or more of the categories above? If not, its time to adjust. Quit being stuck in the middle. Consider repositioning your offering, and aiming to set a wholly new standard.

Start Small!

Wisdom Manifesto Principle 3: Think Big, Start Small, then Scale Fast
In execution, its almost impossible to think big and start big. Thats why we always recommend thinking big, starting small, then scaling (or failing) fast. As Professor Bill Sahlman of Harvard Business School has said, Businesses should begin as a series of sensible experiments.3 Theres nothing wrong with having a formidable idea, then proceeding to launch miniature versions of it that allow you to continually tweak your concept. Take Chipotle, the Mexican food chain, whose motto and purpose statement are Food with integrity . . . the very best ingredients raised with respect for the animals, the environment, and the farmers. Steve Ells had a very big idea about food, but rather than executing 100 percent of his vision overnight, he gradually made his way there to really proving concept before sealing it. Think Big!

Bake Sale: Annas Chocolate Cookies - $5

Scale Fast!

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