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Is Your Business Model Obsolete?

Posted By Ron Sidman, Thursday, May 29, 2014
Updated: Tuesday, July 21, 2015

If you weren’t able to attend my presentation at the recent ABC Spring Educational Conference in Orlando, here’s a summary of what I talked about. Hope you find it interesting.

Everyone seems to agree that the world is changing more rapidly than ever. I started The First Years, Inc. in 1972 and ran it for 32 years until it was sold in 2004. At the time of the sale, our sales were over $140 million and growing, we had $28 million in cash, and we had a solid business model in place. However, if I were starting a company today, the model would be quite different. Too much has changed.

If you’re not getting the financial results you’d like, it may well be that your business model has not kept up with the times. But even if you are doing well, it’s wise to have a mindset of continuous evolutionary business model improvement.

What do I mean by a business model? It’s your company’s entire system for delivering value to your customers while making a profit. It includes the products you sell of course but it’s not just about products. For example, the IPod would have been nothing without ITunes and the ITunes store concept. For the purpose of creating or improving a business model, it’s helpful to understand its components. Every company whether it’s a juvenile product manufacturer, retailer, restaurant, or airline has the same six components.

Your Value Proposition is who your customers are, what you provide them—your products or services, and why they will prefer you to the alternatives—specifically what unique benefits you provide. How you make their lives better?

Your company’s Culture is the critical “soft” stuff that holds everything together. Culture includes your core values, your shared vision of what your company can become, your brand identity, and even your compensation and rewards policy because of how that impacts core values like teamwork. Companies with long-term success typically have strong cultures that are vigorously enforced—like Walmart, Apple, Disney, and Southwest Airlines.

You need a way to get your products or services as well as your all important “why we’re better” message to your customers. You do that through Channels. You may sell through specialty retailers, mass retailers, etailers, your own web site, mall kiosks, drones? Some combination? Your “why we’re better” message may get delivered via the same routes for example packaging, store personnel or signage at retail or information on a web site or through other media?

Your Operating Processes are all the ongoing routine functions your company performs. Like developing products, managing your human resources, maintaining relationships with retailers and consumers, producing products, etc. This is a component that should be improved continuously no matter what.

Resources are the people, skill sets, facilities, equipment, and financial strength required to perform your processes. This is another component that should continuously improve—especially the quality and skills of your people.

And, finally Pricing is the financial formula of your business. What are your revenue streams? Just product sales or also fees for services? What’s your pricing structure? What margins do you and any intermediaries make? What are your costs? Will all these components work together to make a profit?

So that’s all there is to it. These components are the dials you can turn, so to speak, to create and improve your business and there are an infinite number of potential variations limited only by your imagination.

I recommend to my clients that at least twice a year they update their understanding of internal and external current reality and gather their key staff members to review the current business model and identify possible improvements. The question to be asked is, “If we were starting the business today, how would we design our business model?” This “business model evolution” process is replacing the old annual strategic planning exercise we’ve all used in the past. It takes a holistic view of the entire company rather than a piecemeal approach that can produce unintended consequences. It’s more likely to generate breakthrough versus incremental improvements. And implementation is more straightforward. I’ll get into the detail of the process in a future post.

At The First Years, our original business model was changed somewhat dramatically over the years as new competitors appeared, retailers changed their strategies, new technologies came along, or opportunities presented themselves. The result was that we kept what started as a family company in 1952 going for 52 years before a successful sale and created a brand which is now 42 years old and still in existence. It’s all about staying up with the times.   

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Getting High on Management

Posted By Ron Sidman, Friday, January 17, 2014
Updated: Tuesday, July 21, 2015

It’s a new year and a good time to focus on the positive side of your job as the manager of your business. In this post, I’d like to consider the question of what makes management fun and rewarding and what you can do to increase that pleasure. Here are four potential sources of management joy.

It can be very gratifying to watch your staff grow under your leadership. Impacting the life of another person in a positive way can be an enormous source of pride and can do wonders for your organization.

To do more of it, think of your role as enabling your employees to be successful. As much as possible, you should be the coach on the sidelines helping them succeed. Make sure the work they are doing is designed properly, listen to them and act on what you hear, provide training opportunities so they can keep improving, and let them know when they’re doing a good job.

An insight is an “aha moment”. It’s when you finally understand the true nature of a situation. It’s when a business or product opportunity suddenly comes into focus. It’s when you discover an elegant solution to a stubborn problem. And it can be a real high!

To create more insights, create processes that allow both you and your staff to do just that. You can systematically create business design insights, product insights, customer insights, and employee insights. All these processes usually involve gathering information (including through first-hand observation), collaborating with people who can add value, brainstorming, and testing to confirm your beliefs. Insight creation can be baked into your culture if you really think it’s important. If you do, you’ll be smiling all day long.       

Since your business’s purpose is to somehow make the lives of parents and their children better, there’s not much in business more satisfying than getting product or service compliments from them. It makes all that hard work pay off. Similarly, a compliment from a major retailer goes a long way towards making you feel more secure.

It all starts with thoroughly understanding your customers including what they want and how they really feel about your products and services. You can’t make them happy if you don’t know what makes them happy. And you can’t keep them satisfied without having an outstanding ongoing feedback system that is both accurate and timely. 

You are running a business after all so while all the preceding management functions can be pleasurable, there’ll be no joy if you’re not also growing your top line and making money.

I would argue that if you do a good job of items 1 to 3 above, you’ll enhance your ability to succeed financially. But you can increase your chances even more while making your own job more enjoyable by hiring a business-savvy CFO who thinks of their role not as the company’s financial chief of police but rather as the “chief efficiency enabler”—helping everyone in the company reduce waste and improve productivity year after year.    

Happy Managing!

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The Leadership Your Employees Deserve

Posted By Ron Sidman, Friday, August 23, 2013
Updated: Tuesday, July 21, 2015

In his speech at his recent induction into the NFL Hall of Fame, Bill Parcells referenced a quote that he said was at the heart of his coaching and leadership philosophy.

"The players deserve a chance to win, and you as an organization, a university and a head coach have an obligatory responsibility to give it to them."

What struck me is how much that also applies to managing a business and what a great perspective that is for any leader to have. Your employees absolutely deserve a chance to succeed and it is your job to enable them to succeed.

That’s a lot different mindset from the “hire the right people and get out of their way” approach that I’ve heard espoused far too often and which I firmly believe is really abdication of leadership responsibility. The “hire the right people” part is obviously crucial. But, any great coach knows that throwing a bunch of star players on a court or field does not produce a winning combination. I’m not advocating micro-management but I am suggesting that you as leader need to provide your staff with a framework within which they can flourish.

Business is a team sport and it’s the collaboration of the players towards a common goal that creates success. The players play the game, but the leader needs to do three things to enable them to be successful:

1.       Design (and redesign periodically as necessary) an effective operating system that defines how the players (employees) will interact to achieve the overall corporate mission.

2.      Deploy that system by recruiting the right types of players (knowledge, skills, and attitude), providing needed training and guidance, creating the appropriate culture and compensation/rewards, and supplying the necessary equipment and facilities.

3.      Direct the day to day activities monitoring how well the system is working, facilitating ongoing communication, and implementing corrective action when appropriate.

These are three very different types of top management activities that require different leadership and management skills. In some companies, one person plays all three roles but in other companies, the “Design” role is played by someone with more visionary talent while the “Deploy” and “Direct” roles are played by someone with more operational skill and experience.

Ask yourself these questions. When things go wrong in your company, before you place blame, have you and the other managers in your firm made sure you have designed the work flow such that people can do their jobs successfully? If your departments are not working together smoothly and collaboratively, have you checked whether you might have inadvertently exacerbated the problem by establishing a compensation system that rewards department performance at the expense of corporate performance? Are you providing employees with sufficient process training so that you are giving them “a chance to win” or are you throwing them into the fray and expecting them to figure it out for themselves?

For a limited time, JPMA is offering a special CEO Mentor Skype consulting program called “The Business Checkup”. It’s designed to help you answer these questions and implement a leadership system tailored to your organization at this stage of its growth. It consists of a 45 minute Skype sessions with me designed to help you make sure you are optimizing your opportunities for business success. The CEO Mentoring Program is available to any member willing to make a $150 contribution to Kids in Distressed Situations (K.I.D.S.). If you’re interested, you can contact Kyle Schaller at 856-642-4416 or by email at  You’ll be asked to fill out a totally confidential questionnaire in advance of the Skype sessions which by itself will cause you to think about your business in some new and revealing ways. If you’d like to take a look at the questionnaire click here.

Of course, you can always sign up for individual CEO Mentor Skype sessions as well. Just contact Kyle and he will take care of the details. I’m looking forward to meeting with you.

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5 Tips for Developing Blogger Relationships by Guest Blogger Cindy Meltzer

Posted By Cindy Meltzer, Friday, July 26, 2013
Updated: Tuesday, July 21, 2015

Blogs have a powerful influence on consumer behavior. Technorati’s 2013 Digital Influence Report found that blogs are now the third most influential digital resource (31%) when making overall purchases, behind retail sites (56%) and brand sites (34%). Smart brand marketers (and in many cases, PR firms) develop relationships with influential bloggers and create formal marketing campaigns and partnerships. These partnerships leverage the blogger’s influence with their readership, their web traffic and social media reach to increase brand awareness, boost SEO and drive sales.

As a blogger and brand manager-turned-consultant, I’ve sat on both sides of the table – developing blogger relationships on behalf of a brand or client as well as being pitched to by brands and PR firms who seek to access my audience. (I blog about social media, but after speaking at several blogger conferences I’ve landed on hundreds of “mom blogger” lists and get daily communications from consumer brands hoping I’ll blog about their products.) This year I conductedindependent research highlighting best practices for brands and PR firms who wish to work with bloggers for mutual benefit.

But the fundamental first step in any blogger outreach program is developing relationships. And it takes time and effort to do this well.

Whether you’re just starting to do blogger outreach or want to re-evaluate your existing program, here are my top 5 tips for building blogger relationships:

Tip #1: Research and identify the top influencers with whom you’d like to establish relationships.

This kind of research is essential and is too often overlooked by enthusiastic brands who simply google the list of the top 100 mom bloggers on Babble and email them all at once. 40% of bloggers get ten or more emails per day from brands, according to my research, and bloggers say the #1 thing that makes a brand pitch stand out is if the product is a good fit for their blog. So the more targeting you do, the better. Take the time to determine what bloggers are right for your product. A Google search is a good way to start. You can search for top bloggers in your product category (for example, search for “babywearing bloggers”). Technorati is another resource for finding blogs by keyword, however not all bloggers are listed on the site. For a more granular search, try Google Blog Search to dig into blog content. Look for bloggers who have written about products in your category—or even those who have written about your competitors.

Be sure to identify bloggers at a range of influence. While it would be great to have your product featured on Dooce or Girl’s Gone Child or even Cool Mom Picks, it’s a waste of time to put all of your eggs into one (big) basket. (We’d all love to be on the Today Show and in the New York Times too.) Be realistic with your choices. Identify a few top bloggers who seem to be a good fit, but fill the majority of your list with mid-size and even small bloggers. A good, yet not terribly accurate way to view blog’s traffic stats is Alexa.

Once you’ve identified a list of bloggers in your category, take time to read their blogs. Consider the following questions as you evaluate bloggers. Do they write about products at all? Are their children the right age, or does their blog target the right age group? Do they have any existing policies or guidelines on their blog that describes how to communicate with them? Look for a press kit or product review information. Most bloggers are very clear about how they prefer to be contacted.

Tip #2: Use social listening tools to see who is already talking about your product.

One of the best ways to develop a relationship with a blogger is to reach out to someone already talking about your product. Set up a free monitoring tool to crawl the web searching for product mentions. Google Alerts was formerly the standard, but Google seems to be discontinuing that service. A better option is Mention. Along with setting up web alerts, you should monitor your social media channels for when your product or company is tagged or mentioned.

Tip #3: Start interacting with bloggers on social channels, especially Twitter.

Bloggers are very active on Twitter and it’s a great way to interact with them. If you’re monitoring your social channels like I described above, you may pick up someone mentioning your product. Seize that opportunity to interact. Retweet and thank them for using the product.

Don’t just look for “official” @mentions of your company name. Dig deeper to find casual mentions of your product. (i.e. Just took the baby out for a walk in her new XYZ stroller. Love it!). Do periodic searches for your brand name using the Twitter search function, or better yet, set up a permanent column in TweetDeck or HootSuite with your brand name or product name that can pick up these casual mentions in real time. 

Keep your interactions casual and personable. Don’t spam by pinging a whole group of bloggers on Twitter with the same message or set up auto-direct messages (for example, “thanks for the follow” with a link to your website). Bloggers can see right through mass-messaging, and however will-intentioned, it appears insincere. 

Tip #4: Showcase blog content on your social channels, via your email newsletter or on your own blog. 

If a blogger publishes a post about your product, share it on your brand’s social channels or give it a mention in your next email newsletter. You can even link to it from your own blog. For example, PicMonkey (a small software company) recently published a postshowcasing bloggers who had written PicMonkey tutorials on their blogs. When you share content about your product that was written by someone else, it helps build your authenticity. Also, the blogger will most definitely appreciate the promotion.

Tip #5: Meet bloggers in person by attending blogging conferences or holding blogger events. 

Don’t discount the power of face-to-face interaction. Attendingblogging conferences either as a sponsor or an attendee can be an excellent networking opportunity for your brand. There are blogging conferences for just about every niche all over the U.S. and Canada. A few are starting to pop up in Europe as well. If you do attend blogger conferences as a marketer, read these tips for making the most of your experience. 

You can also hold blogger events at or near your headquarters or in target cities to get to know bloggers in person and introduce them to your products. During these events, brands benefit not only from the face time with bloggers, but also the social media exposure that inevitably occurs during the event as bloggers live tweet, Facebook and Instagram their experience. 

Naturally, developing blogger relationships is more nuanced than I can describe in a single article.  However, establishing these relationships is a necessary precursor to any successful blogger campaign or partnership. The blogger-brand relationship continues to evolve with more than a few bumps in the road.  The most successful brands will be those who understand that there are no short-cuts in the process.

Cindy Meltzer is a digital marketing consultant and founder The Social Craft. She specializes in assisting parenting brands, manufacturers and retailers with social media marketing strategy and blogger outreach. In 2013 she conducted independent researchon the brand-blogger relationship. Cindy is the former Director of Community & Social Media at Isis Parenting, where she established and managed their digital marketing program. She also formed external blogger relationships to collaborate on digital marketing campaigns. Cindy has been featured in the Boston Business Journal, The Boston Globe, Social Media Today and The BrainYard and she has spoken at national marketing and business conferences including the All Baby & Child Spring Educational Conference, Mom 2.0 Summit, BlogHer, Enterprise 2.0 and the PRSA Boston Social Media Summit. 

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Is it Time to Rethink Your Channel Strategy?

Posted By Ron Sidman, Wednesday, February 20, 2013
Updated: Tuesday, July 21, 2015

One constant in business is that the business environment is never constant. In recent years, this has been particularly true with respect to the way consumers select and purchase juvenile products. The question you might want to consider is whether your channel strategy—the process you use to get your products into consumer hands—is still optimal given the new reality?

When I first started in the industry in the late 60’s, the road from manufacturer to consumer went first through wholesale distributors and then retailers. However, a major channel transformation that would be the death knell of many distributors was in its early stages. The pioneering "discount department stores" were changing the retail financial model to a low margin high volume formula that was attracting consumers in droves. As these chains got big enough, they no longer needed the services or economies of scale that their distributors had provided. Any distributor that did not see this coming went the way of the wooly mammoth. Fortunately, we changed our company’s business model from distributor to manufacturer (not an easy task) and prospered as a result. 

So what’s happened recently in the marketplace that might require you to change some of your channel assumptions to avoid the possibility of extinction? 

·         Consumers have many more ways to get unbiased product preference information than they’ve had in the past. There are almost too many sources to mention—consumer magazines, consumer guidebooks, social media, independent web sites, bloggers, government web sites, etc. This arguably enables them to make more objective buying decisions and to be less influenced by traditional advertising and PR. The days of dazzling the consumer with b.s. are over. 

·         Price comparisons are available at everyone’s fingertips. Consumers can readily compare prices for your products from one outlet to another and can easily compare the price of your product to competitive offerings. We’ve all done this to check online prices but now apps like Red Laser and others are even allowing consumers to easily check online and local store prices while in store by scanning bar codes with their smart phones.    

·         Resistance to online purchasing of products in just about every category has decreased. Consumers not just in the US but globally are becoming more comfortable buying online—even for so-called "touch and feel" categories. Also, shipping costs have come down making total pricing more attractive. In their October 2011 article, Harvard Business School professors Rajiv Lal and Jose B. Alvarez mention baby products as one of the categories moving to online retailers most rapidly.         

·         Brick and mortar retailers are at a tipping point that is changing the dynamics of the traditional retailer-manufacturer relationship. Largely because of the preceding bullet points, conventional retailers are under increased stress that is in many cases translating into increased pressure put on their suppliers, including JPMA manufacturers. The previously mentioned HBS article outlined what they need to do to survive which includes moving even further towards unique merchandise not available online and providing the kind of personalized selling or customer educating that web sites can’t do effectively. 

Here are some interesting questions to ponder as you do a "situation analysis" of your current channel strategy:

1.       What buying process are consumers now using to buy your products and similar competitive products? Are you talking to new parents and gift-givers about exactly how and where they are making up their minds? Given that understanding, are you getting your product information and products to them at the right time and in the right place?

2.      What would be an improvement to that consumer purchasing process that would make it easier for them to buy, reduce their cost, decrease their risk, etc.? What if you mapped your consumers’ current buying process for your products and then applied process improvement thinking to come up with a better way for them to obtain them? In other words, are you being as innovative about the process you’re using to deliver your products to consumers as you are about the products themselves? Should you have a multi-channel or hybrid strategy to accommodate all consumer preferences? Are you taking full advantage of what the online revolution has to offer? Have you discussed possible new delivery options with your target consumer customers?

3.      How can you streamline the flow of goods through the pipeline to reduce your costs and/or prices? Can you eliminate any intermediaries or steps? Or, as my company was in the late 60’s, are you the intermediary in danger of being eliminated? Is there a shorter route to the consumer?  Should you consider more direct-to consumer selling? Are you leveraging the best shipping options? Do you have better or more flexible production options? Are there any applications of technology that could reduce channel costs?

4.      Should you proactively find ways to provide unique products to your major retail customers? How will you respond to your retail customers’ need for unique merchandise? Can you afford to produce multiple versions of the same product? Should you become a private label supplier? Or, can you make your products so important to your retail customers that they can’t do without them? 

There’s a lot to ponder. What’s important is to be ahead of the curve. Start to make the necessary changes in your business model when it’s first clear in what direction things are going rather than wait until your financial performance is already suffering. It takes time, often years, to make significant business model changes.

If you’d like to discuss any of this with me, you can do it through JPMA’s CEO Mentor Program. Just contact Kyle Schaller at to set up an appointment for a Skype or Face Time session.

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Avoiding "The Pain of Regret"

Posted By Ron Sidman, Friday, December 7, 2012
Updated: Tuesday, July 21, 2015

My personal quote of the month is from the late self-help guru Jim Rohn:

We must all suffer one of two things: the pain of discipline or the pain of regret or disappointment.

I think this is great advice—for experienced business managers, for new college graduates entering the job market, for EVERYONE who wants to live a fulfilling, happy, life. If I may be so bold, I think it would be an even better quote if it was amended to read, “. . . the rigors ofself-discipline or the agony of regret or disappointment”. Certainly, the second pain is much more severe than the first. In fact, that’s the point. And, it’s really disciplining yourself and instilling self-discipline in your staff that we’re talking about.  

Surprisingly, even though self-discipline is a core teaching of virtually every religion, the moral of countless fables, and a core tenet of numerous self-help books and articles, many of us are unable or unwilling to embrace it. Lack of self-discipline is arguably why many people are overweight and out of shape even though they know that this will almost certainly adversely affect their health and happiness. It’s lack of self-discipline that prevents many athletes or sports teams from ever reaching their full potential because they don’t adhere to their training protocol or make careless errors on the playing field. It’s why many seniors reach retirement age without having a sufficient nest egg to support themselves. And, it’s what causes business managers to make costly impulsive or short-sighted decisions or operate their businesses inefficiently.

Why is it so difficult for us to better control our own behavior? For one thing, it doesn’t come naturally. It’s a habit that has to be learned and practiced. Also, unless you wholeheartedly believe in the benefits of self-discipline, you won’t have the staying power required to stick with it. Some actually resist it because they think it inhibits creativity and work enjoyment. In fact the opposite is true. For example, only within a disciplined product development process can you foster the kind of creativity, spontaneity, and teamwork that produces safe, saleable products as opposed to chaos. 

The choice is yours. If you’re ready to choose the lesser pain of self-discipline versus the excruciating and eternal pain of regret, here are a few ideas to get you started:

·         Create a life plan. Another Rohn quote I like is, “If you don’t design your own life plan, chances are you’ll fall into someone else’s plan. And guess what they have planned for you? Not much.”  A life plan enables you to look at your life as a totality and confront the big questions about what you really enjoy doing and want to accomplish now and in the future both in your personal and business life. It’s bound to change over time, but it provides you with the framework that defines what you need to be disciplined about. If not a full-fledged plan, at least set some measurable life goals. I used to carry around in my wallet a card on which I wrote my goals for each aspect of my life—e.g. family, business, personal health, and even my golf game (haven’t achieved that one yet).  

·         Establish and stick to a daily, weekly, monthly, and annual routine. You need your own “personal process”. This was certainly true when I was running my company, but it’s just as true now in my “2nd career”. I don’t know about you, but when I let my personal routine slip, I not only become much less effective but my stress level increases. Your life plan goals should be integrated into your personal process so that you stay on track. I use Microsoft Outlook as the backbone of my organization system and have found a related book very useful—Total Workday Control by Michael Linenberger.

·         Make major life and business decisions based on data and facts not speculation. It takes self-discipline to resist jumping to conclusions when things go wrong or apparent opportunities appear. It’s easy to make some big and sometimes hard to reverse mistakes this way. You should always be asking and answering the right probing questions. How do we know what really was the root cause of the problem? How can we tell if our customers are really happy with our products? How will our employees know when they are doing a good job? Is this really the right person to hire? And of course, are we staying true to our mission and goals? Your answers should be based as much as possible on hard data and careful analysis and not just personal opinion.

·         Recognize that organizational self-discipline must be led from the top. Self-discipline (or self-management) should be part of every organization’s culture and it’s the CEO and only the CEO that creates and enforces the culture. You can do it by example, through documentation of core values, via training, and most importantly through your actions when discipline is lacking.

If you’d like some help with specific ways for you and your company to avoid the “pain of regret”, contact Kyle Schaller at to sign up for one of my CEO Mentor Skype sessions. They’re “painless”.    

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Creating Blockbuster Products

Posted By Ron Sidman, Sunday, September 23, 2012
Updated: Tuesday, July 21, 2015

My guess is that most JP industry CEOs dream of finding at least one product that is so successful that it is transformational from a company sales and profit standpoint. So, how do you develop blockbuster products that generate tens of millions in sales for years and years and elevate your brand to the "must-have" category in the eyes of both retailers and consumers? You can get some clues by looking at some of the most noteworthy industry product success stories. There are many to choose from but I selected a few with which I am most familiar. What you will see is that there are 4 interesting things that these examples have in common:

·         They solved a previously unsolved significant parenting problem. 

·         They are protected by patents or other competitive barriers such as high cost of entry. 

·         They were not necessarily "overnight successes". 

·         They were not ideas generated by market research.

 Avent Bottle 

This was one of those classic tipping point stories of a product that travelled under the radar for years before catching on. The parent company had the good fortune of generating healthy revenues from a non-juvenile division that enabled the owners to stick with this product for a number of money-losing years until word of mouth took hold. The Avent bottle was one of the first to claim that it could reduce colic and extensive advertising and PR efforts in support of this feature triggered positive word of mouth that helped catapult the product to international success. This was also a story of a husband-wife team with a mix of talents that blended beautifully together. The husband was an outstanding, quality-conscious, patent-savvy engineer and the wife a highly experienced marketer. Their idea of market research was simply to create a product that they themselves would want to use. Restricting distribution of their product to specialty stores also helped enhance the cachet of this premium made-in-the-UK product line. 

Boppy Pillow

It also took a while for the Boppy Pillow to become a phenomenon. The product was initially created by a mom to satisfy a request from her daughter’s daycare center for something to help prop up babies. However, its ultimate success came from serving a completely different purpose than even the inventor was aware of. With the increased popularity of breastfeeding, there was a growing need for something that would allow moms to prop up their babies in a position comfortable for both mom and baby. The Boppy Pillow filled that need and was protected by a strong patent. Yet, in spite of winning a JPMA show new product award when first introduced around 1990, the founder faced significant financial difficultiesearly on and needed aid from an SBA microloan to carry on. A PR breakthrough occurred in 1998 when the product appeared in an episode of Friends. Spurred on by that publicity, 12 years after being introduced it was named by American Baby as the #1 baby product and is still a leading "must-have" product today.  

Take & Toss Cups

Forgive me for including one of my own creations, but I think it’s fair to classify this product and the line of related spinoff products it inspired as a true industry success story. First introduced in 2002, it is still a strong multimillion dollar product line ten years later. This was a case of applying a production technology from another industry to juvenile products. Gladware had been introduced in the housewares industry using thin wall injection molding for containers where traditional injection molding had previously been used. The result was a significantly lower cost per piece and the introduction of the concept of "semi-disposability". We felt that by applying this technology to training cups, we could create a product with considerable appeal to parents because of both higher value and the added convenience of not having to worry about losing or throwing away cups. While the idea was not patentable, the cost of tooling and equipment for this type of manufacturing was so high that it acted as a barrier to competitive entry long enough for us to get the product well-established. The long, stressful lead time for us was the time from the initial idea to actually getting it on the market with a level of performance that met our standards. As I recall, this was about 3 years. Fortunately, the risk paid off and the product was successful almost immediately because of the appeal of the price proposition.  


Breakthrough products like these can be the key to achieving the kind of financial success we all would like to have in our businesses. There are many ways to create them but what at least these examples indicate, is that you don’t necessarily need a huge marketing and product development staff and budget to create winners. What you do need is a "better mousetrap" idea that you can protect and the patience and financial wherewithal to stick with it until it catches on.


Disclaimer: No warranties, express or implied, are contained herein. Purchasers, or users, of this information acknowledge that any errors or omission in the performance of the material contained herein or, any injuries resulting from its use, are the sole responsibility of the purchaser or user, and not JPMA or the author. Opinions expressed are those of the author only.

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The Good Thing About Tough Times

Posted By Ron Sidman, Monday, July 23, 2012
Updated: Tuesday, July 21, 2015

It may be an understatement to say that life in the juvenile industry has not gotten any easier over the past few years. Not that there were ever true "glory days" when the business was easy and the profits flowed freely. But, it seems that the prolonged weak economy, increased costs and uncertainty associated with tighter regulations, and unrelenting pressure from major retailers have combined to create a lot of sleepless nights lately for many JPMA CEO’s.

During times like this, it’s always tempting to blame the economy, hunker down, and wait for things to get better. That may not be such a good idea. First of all, things may not get better quickly enough for you to stay alive. But, even if they do, you may actually be squandering a golden opportunity.

Think of an economic downturn as a stress test for your company—not unlike the monitored treadmill exercise used to detect heart abnormalities. Healthy companies should still do reasonably well when the economy is weak just like healthy people should be able to pass a cardiac stress test with no ill effects. However, there may very well be design flaws in your current business model that were all but invisible when the economy was booming but will stand out like blocked arteries in an angiogram when business slows.

Or, you may have been aware of the need to make painful improvements like reduce costs or make personnel changes but were reluctant to perform the necessary surgery while things were going reasonably well. [These medical analogies show I’m obviously spending too much time talking to my contemporaries in the industry.] 

If you’re not getting the financial results you’d like during the current economic malaise, here are some of the questions you might want to ask yourself:

Is your competitive advantage still strong enough?

Be honest with yourself. Do your products really have enough value superiority over your competitors such that you are the clear choice for your target customers? If not, how can you regain your edge? Accomplishing this will not only make your products more appealing to consumers but will also make you more important to retailers thereby putting you in a better price bargaining position.

Are you maximizing sales with your current customers—retail and consumer?

This is the low-hanging fruit. Are you putting in the effort to really understand the needs of your existing retail and consumer customers so that you don’t miss opportunities to gain ground. Could you be selling more products to consumers who are happy with what they’ve bought from you? What would it take for your major retail customers to expand your presence?

Are you missing opportunities to expand distribution?

Once you’ve maximized business with your current customers, what are all the possible new revenue streams you could create? If you’re a regional company can you become national? If you’re national could you be international? Are there new classes of trade that have potential? Be careful though. Some new markets may be costly to enter.

Can you eliminate or re-price programs, products, services or even customers that are not profitable?

I’ve always been a big advocate of analyzing profitability by customer, product, region, salesman, etc. If you’re not making money at these micro-levels, something probably needs to change.

Are you managing your cash flow as well as you could?

You can get away with sloppy cash flow management when things are going well. But it will come back to haunt you in tough times. Make sure you have a good cash flow projection process in place so you are not blind-sided by cash shortages. But, just as importantly, get innovative about what you could do to radically decrease your inventory requirements, reduce credit losses, ramp up collection speed, or get better payment terms from your suppliers.

Is it time to make those tough personnel decisions?

A business friend of mine used to talk about how, when business slowed, he would simply keep laying off employees until he was virtually the only one left. Hopefully, you won’t find that necessary. However, it might be time to objectively assess both the number of people in your employ and their productivity. This is not something that should be done without concurrently assessing the quality of the processes that your employees are operating within as well as the training you are providing.

Are you leveraging new and emerging technologies?

And, while you’re looking at your processes, are you taking advantage of software and automation that could reduce operating costs and improve quality? Are you staying up to date with what’s out there that’s working for others?

Have you read my earlier blog posts?

Excuse me for a little self-promotion, but if you haven’t already, you might benefit from reading or re-reading my previous blog posts where I offer a number of other revenue enhancement and cost reduction ideas. Or, even better, take advantage of JPMA’s CEO Mentor program where for a small donation to K.I.D.S. I’ll give you some objective feedback regarding your current business model. 

If you look at economic downturns as opportunities to improve rather than times to head for the bomb shelter, you can come out the other end as a much stronger company better positioned for future recessions. What’s this downturn telling you about your business?


Disclaimer: No warranties, express or implied, are contained herein. Purchasers, or users, of this information acknowledge that any errors or omission in the performance of the material contained herein or, any injuries resulting from its use, are the sole responsibility of the purchaser or user, and not JPMA or the author. Opinions expressed are those of the author only.

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How Best to Adopt Sustainability

Posted By Ron Sidman, Monday, June 4, 2012
Updated: Tuesday, July 21, 2015

In my previous post, I talked about why it might be time for you to consider embracing the principles of business sustainability. Let me be crystal clear right up front. I’m not talking about hugging trees, kissing owls on the beak, or making your packages out of recycled tractor-trailer tires. I’m talking about operating your business using fundamental business common sense. It’s my feeling that the concept of sustainability should not be thought of in just the “impact on future generations” sense but also in the literal sense of ensuring survival of your organization. As CEO, that’s your job. And if you do it right, you’ll automatically address the morally appropriate economic, social, and environmental issues in a business-justifiable way.  

In your personal life, the benefits of living a healthy life style, maintaining good relationships with family members, treating neighbors with respect, and being involved in your community are irrefutable and broadly accepted. It’s also understood that sometimes you have to suffer short-term pain for long-term gain. By doing these things you are not really sacrificing for the benefit of others, you are simply optimizing your own long-term happiness and health.

The same holds true for a business. Short-term decisions have long-term implications. Sometimes you have to regress before you progress. And, no business is an island. Every company’s actions impact the “system” in which it operates and are impacted by the same “system”. Embracing sustainability is nothing more or less than making sure your business model is designed and updated with the benefit of a long-term and system-wide view. To do otherwise is to be haunted by unintended and unanticipated consequences and to put your company at unnecessary risk. Well-managed companies have always been concerned about sustainability in the literal sense. What’s relatively new is an increased recognition of potential negative economic, social, and environmental consequences of business activities and an urgency to reflect that knowledge in your business model design.      

Here are some suggestions about how you can incorporate this concept of sustainability into the steps of a standard, typically annual, business model improvement process:

Step 1: Reconfirm your business’s PURPOSE
When reviewing your company’s Purpose, identify not only your customers but also your key stakeholders (non-customers who can affect or be affected by your business to a significant extent). Typical stakeholders would be investors, employees, suppliers, communities in which you operate, government agencies, etc. 

Step 2: Reconfirm your LONG-TERM VISION
Again, include both customers and key stakeholders in your vision of the ultimate role you want to play and the affect you want to have including what you want your reputation to be. For example, you might want to be the company most respected for awareness of parent/child needs. You may want investors to consider you to be very cost-efficient. And, you may want to be a respected and treasured company in your community.

Step 3: Reconfirm your VALUES
Make sure your documented Values will create a culture that supports your updated Purpose and Long-Term Vision. Based on the vision elements above, you may want values related to customer focus, continuous improvement, and community responsibility.

Step 4: Identify current and likely medium-term future REALITY
Conduct your “SWOT” analysis of internal strengths and weaknesses and external opportunities and threats maintaining your new, broader perspective that includes customers and all key stakeholders. Data gathering should include soliciting feedback from both. Make sure you specifically include issues related to economic efficiency (innovation, productivity, material usage), social equity (employee health, impact on local communities, transparency), and environmental accountability (pollution, land use).

When you imagine what you’d like things to be like 3 or 5 years from now (qualitatively and quantitatively), think in terms of how much progress you’d like to make along a path from your SWOT-defined Current Reality towards your Long-Term Vision. Based on the possible long-term elements mentioned earlier, your Medium-Term Vision might include new products that respect parental environmental concerns, redesigned packaging that reduces package and packing costs, and internal programs that encourage employees to be active in local community charity events.

Step 6: Identify your priority ONE-YEAR PROJECTS
For each Medium-Term Vision element, what can you accomplish in the next year to make the most progress?

Step 7: Ensure successful project IMPLEMENTATION
Of course, I’d be remiss in not reminding you that all previous steps are worthless if you don’t ride the One-Year Projects through to successful implementation.  

By using a business model development process to address sustainability issues, you can ensure that you are acting responsibly while adopting only those initiatives that make true business sense for you.   

In my next post, I’ll explore the role that trade associations like JPMA could play regarding supporting their members’ sustainability initiatives.


Disclaimer: No warranties, express or implied, are contained herein. Purchasers, or users, of this information acknowledge that any errors or omission in the performance of the material contained herein or, any injuries resulting from its use, are the sole responsibility of the purchaser or user, and not JPMA or the author. Opinions expressed are those of the author only.

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Is it Time to Fully Embrace Sustainability?

Posted By Ron Sidman, Tuesday, May 1, 2012
Updated: Tuesday, July 21, 2015

CEO’s are often understandably skeptical about the various management “movements” that come and go over the years. However, if I were running a company today, I would be totally embracing the so-called “sustainability” movement—not because it’s the latest rage but because it makes fundamental long-term business sense.

The movement arguably originated in 1983 when the U.N.’s Bruntland Commission was formed to address what was called “the accelerating deterioration of the human environment and natural resources and the consequences of that deterioration for economic and social development”. They later defined sustainable development as “development that meets the needs of the present without compromising the ability of future generations to meet their own needs”.

After getting relatively little serious attention from most companies, especially in the U.S., for many years, sustainability seems to finally be coming of age. In a winter 2012 study conducted by the MIT Sloan Management Review and the Boston Consulting Group entitled “Sustainability Nears a Tipping Point”, 70% of surveyed companies “have put sustainability permanently on their management agenda”. In fact, two-thirds felt it is a necessity to be competitive today and in the future.

Pressure from consumers has clearly been one of the driving forces. A 2011 Nielsen survey of 25,000 consumers globally revealed a high and in many cases rising degree of concern about sustainability issues such as water shortages and pollution, packaging waste, pesticides, air pollution, and climate change. It is true that while consumers may be favorable towards companies who adopt sustainability practices, they aren’t necessarily willing to pay a price premium. 83% of consumers surveyed wanted to see companies implement programs to improve the environment. However, only 23% would pay more for eco-friendly products. Nonetheless, green concerns are clearly influencing purchase decisions. While I couldn’t find a breakout specifically for parents or grandparents of young children, this target market for juvenile products would logically be especially concerned about “. . . the ability of future generations to meet their own needs.”

These same consumer concerns as well as visible environmental issues such as air and water pollution and water shortages have resulted in an increase in federal and local government as well as public interest group involvement worldwide. Past history tells us this will only increase as we go forward much like child safety regulatory activity over the past 40 years.

On the self-serving side, raw material price increases and volatility have also spurred business interest in sustainability initiatives such as energy and material use reduction that directly improve the bottom line. Not surprisingly, Wal-Mart has been leading the sustainability for cost reduction charge since 2005. The cost reduction aspects of sustainability fall right into Wal-Mart’s business model wheelhouse and, if you’re a Wal-Mart supplier, you have no doubt already been coaxed into making packaging changes that have reduced material usage or shipping costs.        

While responding to consumers and government agencies and reducing costs have been the primary factors driving companies towards the adoption of sustainability principles, I believe there’s actually an even more basic reason to incorporate these concepts into your management system. The fact is that the principles of sustainability represent a perfectly logical and desirable enhancement of a company’s business model development process. Embracing sustainability will cause you to take a broader view of the “system” in which your business operates resulting in the creation of a more robust and effective business model and resultant increased long-term business success.

In my next post, I’ll describe how you can embrace sustainability in a way that makes sense for your company. I’ll also talk about the role JPMA as a trade association might want to play in educating and supporting its members as well as interfacing with government agencies and NGO’s in the same way it has with safety issues.    

Disclaimer: No warranties, express or implied, are contained herein. Purchasers, or users, of this information acknowledge that any errors or omission in the performance of the material contained herein or, any injuries resulting from its use, are the sole responsibility of the purchaser or user, and not JPMA or the author. Opinions expressed are those of the author only.

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