Equinnovation : About Equinnovation, page 2

About Equinnovation:
Base Your Decisions on Value

Smart horse people make decisions based on value: what are we getting for our money? Every day we balance price against value, trying to get the most value for the least cost.

The Best Decisions are Based on Value

Suppose you have a racehorse. Your horse does pretty well, wins some races, and you make money. When he needs shoeing, would you automatically hire the cheapest farrier? Heck no. “No hoof, no horse,” right? The horse makes money for you by using those hooves—he needs them to race! No racing, no winning, and no money for you. You want to keep those feet and legs in good shape, and you know that it takes capable farrier attention to do the job. So when you hire a farrier, you will hire the most capable you can get at a reasonable price.

Now think about your business instead of our hypothetical racehorse. It isn't such a stretch—the business world is very competitive, you could even call it a race. Your business' customer base is the racehorse's feet. Without customers your business does not run. If your business doesn't run there is no way it can grow, make money for you, or accomplish whatever your goals are. And what keeps the customer base in good shape? Marketing! Marketing is the farrier. Your business needs good, effective marketing, just as the racehorse needs capable farriery.

Back to the racehorse, suppose you have a choice between two equally talented farriers. One charges $500 to trim the horse and put on racing plates and the other charges $300. You'll pick the one who charges less. If the value of the service is equal, it makes sense to pick the cheaper one.

What if a third farrier becomes available who charges $700, but this one is the best? 80% of the horses he shoes win 90% of their races. Some of those shaved 3 seconds off their time as soon as he started shoeing them. Odds are that he can do better for your horse, and better for your profit margin, than the $300 farrier. By winning a race instead of coming in second, your horse will earn a lot more than the $400 difference in price. It's smart to spend more if you will earn even more.

It's the same for your business marketing. If you have a choice between services that will give you the same value—the same chance of keeping the customer base sound and healthy, the same chance of winning the business race—pick the one that costs less! But if the more expensive option can get better results, that is the best choice for your business.

Now, suppose the farrier gives you some options, and they each will add $200 to the price of the shoes. You can have custom-colored racing plates instead of plain old aluminum. They have green rhinestones set along the edge. The nails are even green. Green, like money. OR you can buy shoes with caulks, an added feature to help the horse get traction in bad footing.

How do you choose between these extra features?

The green shoes are pretty, and you know they would look nice on your horse. But will they make him run faster? Will they improve his chances of winning, and earning money for you? Nope.

While the shoes with extra traction won't make your horse look any fancier, they won't make him look any worse. They are hardly noticeable. But if he will be running on a slippery track, they might help him run better and faster.

You are trying to maximize your profits from the horse's work. So you'll go for traction instead of color, function over added beauty.

You probably know what I am going to say next. You can pay for all sorts of “pretty” marketing “extras”. But unless those things make your business run better and improve your chances of winning the race, they do not provide added value. On the other hand, options that actually have a chance of improving your success are worth the extra money. If you want to maximize your business' profits, invest in extras that add value.

So how is Equinnovation different?

I don't want you to spend too much. I don't want to sell you something extra that you don't need. I don't want you to waste your money on things that won't improve your business' chances of success.

I do want your business to succeed, and for you to get maximal value for your marketing budget.

To maximize value, you need a method of ...