John Malmo

Commentator

There’s a popular belief that nine out of ten new restaurants fail in the first year. It’s a myth.

A new study by an associate professor of hospitality management at Ohio State has identified a real figure of six. Six out of ten new restaurants fail in the first year. That’s still pretty high mortality, but not out of line with startups in other business categories.

Nevertheless, I think the only business tougher than retail is the restaurant business. There are just so many different reasons why people don’t come back.

No matter what new services or products appear, no matter what tools, concepts, strategies or tactics people dream up, the basic fundamentals and principles of marketing stubbornly remain the same: maximize your assets, discover needs and how to satisfy them, and, of course, segment something. Anything.

Though almost every new business category begins with a broad market appeal, in no time, entrepreneurs segment the market. By price, gender, age, geography ... every way imaginable.

Blockbuster Video died a slow death, though profitable for many investors. Blockbuster stores lasted more than a decade beyond original predictions of demise.

Similarity between Blockbuster Video and Barnes and Noble book stores is uncanny: one rented and sold movies in retail stores and was put out of business by electronic delivery of movies; the other sells books in retail stores and online and is suffering from online books delivered electronically to hand-held devices.

@snaptitude / fotolia.com

Don’t you love it when you learn about somebody using her or his noodle to solve a problem, instead of just throwing a bunch more money at it?

On this very radio station, this wonderful station, you may have heard the story of how in Cambridge, MA, they cut bicycle thefts at a subway and bus station by two-thirds with a cardboard cop.

They substituted a cardboard cutout of a uniformed security officer and a couple cameras for the $200,000 it would cost to station a real, live officer.

Luxury Is Not Quality

Sep 25, 2013

You may personally have observed that there may be more quality in a car that costs half as much as one with great luxury: quality and luxury are not the same.

Now that they’re making money again, airlines are scurrying to add luxury everywhere. There are new seating choices with inches more leg room and better seating. There are fully reclining seats on long-haul flights in certain classes.

Archer>Malmo

A wise marketing professor once said that when things go wrong, more often than not, it isn’t because the strategy was bad; it was because the strategy was executed poorly, or, not at all. In other words, nobody made it happen.

William Bonoma at the Harvard School of Business likened it to war. He said, in effect, without a competent, hard-charging sergeant to drive the squad up the hill, no strategy would work.

Henry Ford, In Reverse

Sep 11, 2013
Harry Shipler (1910) / Shipler Commercial Photographers

How Henry Ford developed mass-production is a fascinating story. It's also one that I've had backwards all my life: I believed that Ford was able to reduce car prices for a mass market because of his genius in perfecting mass-production assembly lines.

Actually, the opposite is true. Ford's low prices forced development of mass-production to meet the demand. Hear what Ford, himself, said about it:

thinglass / fotolia.com

In 1945, the author of my 10th grade English grammar book wrote, “A democracy needs citizens with skill in listening, reading, thinking, and the precise, forceful expression of their ideas.”

Nearly 70 years later, I’m told that grammar really isn’t important any more. They say that as long as you can understand what someone says, it’s not important if he or she can’t recognize a subject from an object of a preposition.

Archer>Malmo

Every company in the world operates in the shadow of obsolescence. Its markets always are in a state of flux: they’re either growing, or they’re shrinking.

No product, much less any brand, enjoys expanding markets forever, and when markets cease growing, it is only a matter of time before they shrink. This undeniable pattern is why every company needs at least one person to be constantly on the lookout for opportunities to apply his company’s assets to the creation of new, customer-satisfying uses.

From recent experiences, airline service can’t get much worse than Delta. Nevertheless, Delta also is the classic example of real, heads-up marketing at work.

It’s because Delta turned over its marketing to one of those rare guys who actually knows what marketing really is. His name is Tim Mapes, and listen to some of his marketing strategies and tactics.

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