How Focusing On The Big Picture Can Help Grow Your Bottom Line
This article was published on the American Express OPEN Forum. When I sent in the article, I called it “If you focus on the hot dog, you might go hungry.” Clearly they didn’t like that title
Regardless of how you feel about Trump’s now aborted run for President, you have to give him credit for creating a cult following to some rather engaging television since early 2004. Trump’s show has a business slant to it and at times provides useful insightful tips for businesses of any size. I am reminded of an episode of the Celebrity Apprentice that applied some particularly valuable innovation concepts.
The task for the week was to see which teams, split up by men and women, could sell the most hot dogs to raise money for charity. This particular episode opens with Trump informing the celebrities that they’re all “commodities” and should leverage their “personal brand” to help them.
The first challenge was to establish the price of the hot dogs: low enough to sell large volumes yet high enough to maximize margins. This is a challenge that all companies face when pricing their products or services.
Each team started selling their dogs for about $5. As they progressed, they began up selling their customers using a variety of creative gimmicks. Their plan appeared successful so they continually increased the selling price by bundling in extras (e.g., pictures with the celebs).
Each took a slightly different approach. Omarosa, the lead for the women, didn’t think her team should use their celebrity status in the task and should instead focus on skill. They primarily focused on “traditional” business techniques, selling as many high priced hot dogs as possible. In the end, they sold about $17K.
The men’s team, headed up by Stephen Baldwin, begins using their celebrity status right out of the gate. Gene Simmons, one member of the team, calls a collection of his elite group of friends asking them to visit their stand. Instead of selling $200 hot dogs, they sold $5,000 hot dogs to their high-roller friends. The result? Over $52K in sales. Over three times the profit of the other team.
This winning team figured out something quickly. The hot dogs were not the end game—they were a means of getting to the objective: raise the most money for charity. They effectively took Trump’s advice to creatively leverage their “brand” as well as their connections.
This highlights one of the mistakes that organizations make when thinking about innovation…