technology

I was just on a conference call with three experts in digital design. We are preparing for a panel discussion at the Gold Conference in New York at the end of April (you really should join us! Here’s a link to learn more about the conference). We were discussing the transformative aspect of digital design and manufacture, and whether or not the jewelry industry has actually embraced that yet.

Many of us are talking about the struggles in the jewelry industry.  Here are just a few of the more comprehensive writings on this topic:

• What Will Become of Jewelry Retail Stores? Peter Smith (4/12/2016)
• Everything You Know About Luxury Has Changed. Andrea Hill (5/27/2015)
• The Jewelry Industry and Millennials: What do they want? Rob Bates (5/18/2015)
• Past Time for Change: A Post to the Jewelry Industry. Andrea Hill (6/2/2014)
• You Need to Attract the New Consumer.  Andrea Hill (3/17/2014)

And yet, the store closures (~750 last year) keep happening, specialty retail stores are stagnating, and the industry mood is a bit grim.

Digital Design has Already Transformed Industries

So let’s look at what’s happening elsewhere. One of the guys on my call this morning (Harry Abramson, Direct Dimensions) shared a story about his brother (brother-in-law?) who is in the custom t-shirt business. Whereas at one time, if you wanted a custom t-shirt, you had to produce or select a design, then order and stock it by the dozens in each size and color; today you can order one custom t-shirt at a time with virtually the same delivery time. The individual t-shirt may cost a bit more than the cost of each t-shirt in bulk, but there’s nowhere near the risk or inventory cost associated with the old way of doing things. To a certain extent this type of design customization is available today in jewelry stores using Stuller's Gemvision system.

I experience this in my own business as well. Often I receive calls from people asking if we sell any of my business quotes (the benefits of social media, I guess) on mugs, mousepads, desk art, etc. We can and do, one piece at a time, to order.

In the fashion industry, the CFDA has embarked on a significant mission to study how to remain relevant in the age of fast-fashion. In the “old” way of doing things, the fashion industry produced big shows in the spring and fall, showing fashions that will be available for sale at retail six months later. Today, consumers are snapping up those same design concepts at retail almost as soon as the shows are done. How? Fast fashion operations are producing their own versions of what’s hot during Fashion Week very quickly, delivering to demanding consumers the style concepts they saw almost immediately after they saw them.

Paint manufacturers figured out the benefits of fast, digital design long before the rest of us. Instead of stocking 100 colors of paint, your local hardware store stocks a few base colors, and dozens — even hundreds —of colors, all of which can be mixed on demand for each customer.

Publishing, music, printing, television, automobiles, vacation packages, the list goes on-and-on — all have been transformed by incorporating consumer-driven digital design into the process. And by “consumer-driven” I don’t mean consumers doing the design (though in some cases that has happened). By consumer-driven I mean taking into account the real needs and desires of consumers – expressed and yet-to-be expressed – and designing to meet those needs.

There's a difference between "embracing CAD" and  "using digital design for transformation"

I’ve written and spoken at length about how the industry needs to embrace the digital world and incorporate it comprehensively into the bricks-and-mortar world. This is still true. But internet marketing and selling aren't the only digital transformations we need to embrace. How can we bring to consumers the jewelry designs that turn them on — designs that are extremely well conceived, vibrant, contemporary — at retail? How can we achieve what the luxury automobile manufacturers are doing, bringing forward impeccable design and consumer-focused innovation at lower production and marketing costs than in the past?

The tools are there. CAD, 3D growers and digital manufacturing on the design and inventory production side; and advanced CRM systems on the sales and promotion side. But what we’ve focused on in CAD for the past 10-15 years is just getting people to pick up the tools and learn them.

Now that time has passed. It’s no longer sufficient to use the digital tools available to us to simply do the things we are already doing, only faster and cheaper. We need to be innovating new ways, more ways to apply digital tools in our businesses. We need to be so adept at using the digital tools available to us that we start coming up with big new ideas. It’s time to use the digital tools to transform our businesses and our industry. Either that, or let the new world of design, production, and retailing move on without us.

PS. There is still a very important place for hand craft. There always will be. And there should be more hand craft - not less - in jewelry stores. But hand craft alone will not solve the problems the industry is facing. Digital design must also be a big part of the equation.

I’m sitting in a Starbucks getting some work done between appointments. At the table across from me sits a 70ish woman. She’s reading a magazine and she has a Daytimer and pen on the table. From all appearances, she is a non-digital person, and that seems rational given her age.

But then she takes out her smart phone for a moment, and it’s not to make a call. I think, “Oh, she’s texting someone. Maybe I was wrong.” She puts the phone back down on the table (can you tell I’m more in observation mode than work mode?). A few minutes later the barista calls out a name, and the 70ish not-so-predictable woman gets up and retrieves the order that she clearly placed and paid for from her phone moments before.

It’s not just millennials who are comfortable with living in a digital world. People of every age and type have rapidly adjusted to the full range of opportunities available to them from their smartphones, tablets, and desktops. And the most significant factor in helping them become comfortable with the digital age has been companies like Starbucks leading the way with an increasingly digital customer experience.

People have learned to expect more from the places they shop and eat, because those have been the places that adopted an integrated digital-within-real-life experience. What does this mean for you if you sell goods to consumers? It means that they have higher expectations of you than they once did.

This is because the things that retailers have focused on first – more than coupons or discounts or kitchy promotions – have been customer service improvements.

Don’t want to wait in line at Panda Express? Order from your phone and pay before you leave the house, then pick it up either in the drive-through or at the counter. Not sure if you should buy that blender at Home Depot? Need more information on that vacuum cleaner than the box provides? Scan the QR  code on the shelf and do your research. Price compare right from your phone while you’re still in the store. Just realized you have time to make that matinee of Kinky Boots? Order your tickets from the cab and have them waiting when you get there. Love the song you’re listening to in the coffee shop? Download it to your phone immediately. Or place an order for a new cup of coffee without the risk of losing your table.

What does this mean for retail? It means that customer expectations have taken another leap  forward. Customers want to receive products faster. They want to self-serve information. They want the check-out experience at the register to be completely painless. They don’t want to wait in lines. They want to find things very specific to their interests, body types, and budgets – and they know those products are out there, even if they’re not available locally. Customers know enough not to have the same expectations of every type of seller; but still, they have greater expectations over all.

It has always been true that to be successful you had to find a way to establish a reason to buy from you rather than your competitors. Back when the nearest competitor was 25 miles away and the only transportation was a horse-drawn wagon, location alone provided competitive advantage. Today digital consumers shop the nooks and crannies of the globe – easily and cost-effectively – looking for the specific things they want. If the thing they want is a luxury rather than a necessity, they are more dedicated than ever to finding just the right thing. Oh - and it’s not just millennials. It’s everyone.

So the question is, what are you doing to create a reason to shop from you instead of from your competitors? What are you offering this brave new world of savvy digital consumers looking for solutions to very specific needs – from product needs to experience needs? If you’re not figuring this out, if you’re not exploring beyond the margins of what you thought your business was to find new answers, you may be running out of time to catch up.

What is the Internet of Things?

I've been holding on to the front page of the Milwaukee Journal for a month now, returning over and over to an article written by John Schmid about the Internet of Things.  Mr. Schmid didn't invent the term, referred to in technology circles as IoT. I can find references to it going back to the Consumer Electronics Show in 1994, when remote-controlled thermostats were introduced. In March of 2010 McKinsey & Company referred to the Internet of Things as "sensors and actuators embedded in physical objects—from roadways to pacemakers—linked through wired and wireless networks, often using the same Internet Protocol (IP) that connects the Internet."

Until now, the concept has been one explored primarily by big data - Cisco, Rockwell, General Electric, and other massive enterprises that will make their next wave of fortunes by connecting all these things to the internet. But in the Journal Article, Mr. Schmid quoted Keith Nosbusch, CEO of Rockwell Automation Inc. saying, "We are past the inflection point, where there are now more things connected to the Internet than people." 

In the article Mr. Schmid states, "The Internet of Things will be defined by the exponential growth of web-enabled "things" that measure, monitor, and control the physical world, talking with each other more than they talk with humans. Among the many examples: thermostats, car keys, public toilets, lake levels, parking meters and parking spaces, refrigerators and televisions, subways and airports, automated teller machines, soil conditions for crops, and garbage cans that can say when they're full." Cisco Systems CEO John Chambers refers to this as the "fourth wave of the internet," but that under-represents the enormity of IoT. This is the next industrial revolution, and we are already in it.

How Does This Apply to Your Business?

It's easy to picture how big companies involved in making microchips and writing code to connect and monitor the things housing those microchips can benefit from (or get left behind by) this trend. But it may be more difficult to see how it applies to you and your business. 

First, some of the larger aspects of IoT must be carefully considered:

1. Privacy (what does Google do with the data about your home or store heating and electricity usage?)
2. Security (the intersection of hackers and home/business invaders)
3. Safety

These are already being debated in the tech world, and to a very small extent by Government, and we need join these conversations and move them forward quickly, because once again technology is getting way ahead of our ability to anticipate how it will affect us.

And what about the social implications? Most of my readers are small business owners - we live and breathe in the small microcosms of our communities and our niche industries. What does the IoT mean for us? There must be myriad social implications about this next phase of the world we live in. I think this is why I've been holding on to the newspaper for a month. I can intuit that we need to be very aware of and responsive to this next phase, but I can't quite articulate why. I don't like it when I know something without knowing. Here are a few things that occur to me, and now that I'm considering IoT and its affect on my world, I'm sure that I'll come up with more.

The Internet Made Small Business More Competitive. IoT May Reverse That Trend.

Big business has been trying since WWII to satisfy American consumers' demand for ever cheaper goods. Moving factories from country to country, chasing cheap wages, is only a temporary solution. But the next wave of automation could put each of these large businesses on a brand new track of cost-cutting. Oh sure, we've had automation for years now. But this is a new phase of automation, a world of truly "smart" factories, factories that can sense and correct for quality deficiencies before the products have moved to the next phase. We're talking about factories that can modify and manage production schedules on-the-fly to accommodate changing customer needs and escalations. 

If you are a small manufacturer, and you haven't even automated your data yet, this could be bad news for you. We're past the point where knowing your true costs and having visibility to your purchasing needs and production plans is sufficient. Now, those are the minimum standard necessary to compete. How will you take advantage of the next phase of manufacturing technology if you don't have strong technology protocols in place already? And don't just assume that all these automation elements will be too expensive. There is a good chance that much of the technology required to run the Internet of Things will be affordable very early on.

Retailers are on the verge of being able to quickly analyze what's hot and what's not, move inventory around to be more conducive to traffic patterns, make offers more exciting and relevant on-the-fly, and be more proactive to their customers' needs, wants, and timetables. If you're only analyzing your inventory a few times a year, not replacing important items as they are sold, and failing to correct for the unsold walk-outs, your store will feel boring and static.

Some of the Impact will be Perception

When cars were first introduced, horse-and-buggy was still the predominant means of transportation. Eventually cars were dominant, but horse-and-buggy was still an acceptable mode. Then, suddenly, it wasn't. One day the tipping point occurred, and those driving horse-and-buggy were considered quaint at best or hopelessly out-of-touch at worst. 

When stores first offered personal check-out computers, they were a novelty, but cool (even though they almost never worked). Younger people were drawn to them, and older people tended to avoid them. So imagine how I cringed last week when I was in a specialty retail store and a consumer complained to the salesperson, "I could check myself out faster at Target." True, the consumer couldn't buy the item she desired at Target, but could she  find something else she wanted with that same money? Of course she could. And I'm sure she left that store with an impression of its backwardness, not a perception that it is a relevant business that can meet her needs.

Small business is often quaint and colloquial and community-based, and those are wonderful attributes. But we have to find a way to remain those things while responding to the expectations of our consumers as their expectations evolve. When I was a child, growing up in Iowa, I was acutely aware of how different my clothing and mannerisms were whenever we would visit my cousins who lived just outside New York City.  These days I bring my granddaughter -who lives in a town of less than 1,900 people in Wisconsin - to New York, and you wouldn't be able to tell her from the other children. There are no more pockets - at least in the United States - that are immune from the changes taking place. It's probably OK to still take paper tickets at the open-three-months-a-year gift shop in the North Woods, but it's not OK to be perceived as backwards when you are a small business competing for daily traffic on Main Street.  For the past few decades we've been driving horse-and-buggy while big business bought cars. But the tipping point is here, and we must move on.

Where Do You Start?

Start by accepting that embracing technology is not optional. I'm not sure if it ever was, but considering the speed of change we are facing, that moment in time is gone. Start with you. Start by recognizing that it is no less possible for you to learn to work a computer or a software than it would be for you to learn to survive in the wild if you had to. Trust me, if you needed to kill a rabbit with your bare hands in order to eat dinner, you'd eventually get hungry enough to do so, and creative enough to figure out how. The reason most technology hold-outs haven't jumped in yet is because it's daunting, and they are busy, and they don't feel like learning something new.

Start by evaluating which aspects of your business are lagging behind the technology curve.

Most small business owners have sufficient bookkeeping software or support. But do you have enough information to analyze your business from product to price to timing to turns? Are you making management decisions based on support from data, and not just using your gut? You need both. And our gut instincts get continuously better as we feed our insights with real data. Data in real-time, not just data at the end of the year.

How easy is your Point of Sale? Is it quick, intuitive, and considerate of the customer's time? The customer wants to spend her time shopping and making decisions, and then she's done.  So you need systems that can balance your need for information, that can inform your thinking about which information is most valuable, and can do all that while being transparent to the customer.

How well are you managing your inventory? Do you know exactly what every piece cost to make or buy, how long you've had it, whether or not it's been returned, and what was wrong with it? And can you do all that with a snap of the fingers instead of by digging through old receipts and questioning your staff's memories?  Can one of your employees pick up with a customer where the another employee left off? Is your business capable of being the ultimate massage therapist, never taking a hand off the customer?

Most small businesses have become at least somewhat comfortable with social media and the internet of Google and Youtube. But the next phase of our business lives goes way beyond that, and to connect to that grid we need pieces in place that are connect-able.  That's not playing on social media - which is in some ways like the Model T. The connect-able pieces are the rest of the elements of your business that allow you to tap into and take advantage of the technology that's right around the corner. Sales and marketing automation, true CRM, enterprise systems that connect your business information from raw materials to finished goods and through the sales process. These things are not cheap, but neither are they out-of-reach for small business owners. What is lacking to date is not just cash. It's the will.

John Schmid ended his Internet of Things article in the journal with a quote from Cisco CEO John Chambers. "The speed of change will spare no one." Don't set your business up as something in need of sparing. You held on to your horse-and-buggy long enough. It's time to learn to drive a Tesla.

I’m a bit of a history buff. I particularly enjoy stories about people who took chances and accepted new ideas, approaches, or technologies despite social pressure to stick with the status quo. Why? Because progress depends on groups of this type or person–risk-takers and visionaries—to propel the rest of us into the future. But just as there must be early adopters to champion new ideas, there always seem to be people who avoid mastering the new ideas for as long as possible.

Don’t Be Left Behind

The internet as a sales and marketing medium has reached critical mass. Consumers across all age groups look to the internet for brand, quality, customer satisfaction, and product information, using every type of device from desktop computers to phones to tablets. Yet I am still frequently asked, “Is it really important for me to have a website?”

And then there’s the question of social media. Only last month I had dinner with a group of jewelry industry leaders where I heard one executive rather forcefully express his opinion that he did not see the value of social media to business, nor did he believe that computers had a significant role to play beyond increasing efficiency and data management.

If you want to increase the value of your business, you must embrace and master internet technology as an important part of your marketing, selling, customer communications, customer service, and brand management strategy.

The Next Wave of Cottage Industry

The publishing and video industries have much to teach small business. Both industries were transformed by big-box retailers—small retailers simply could not compete on inventory or on price. And now, as the behemoths of books and video crumble under their own scale, high-service, high-quality bookstores and video stores are returning to serve discriminating consumers.

But they are not returning in the same configuration as before. New stores offer more knowledgeable customer service, special order services, engaging social media experiences, rich websites to offer a breadth of inventory they cannot afford to carry in the stores, mobile apps to engage with consumers wherever they are, and in-store online technology to supplement the store experience. The stores are staffed with collectors and impassioned readers and film viewers who bring true expertise to their customers.

These changes have created opportunity for independent producers and publishers, who both sell to these more creative independent retailers and sell directly to consumers. Using the same tools, independent producers can now service more dealers and reach more consumers than ever before and sustain those relationships without creating expensive corporate infrastructure to do so.

You Can MustDo This

It’s no longer enough to just have a website. You must have a website that looks and feels current, and offers more than just a few pretty pictures.

About 10 years ago during the first big go-round of website building, many companies got stung by creating websites that were expensive to build—and even more expensive to maintain. Today you have better options. Both technology and the people providing and servicing it have evolved. Here are some tips to help you fully embrace internet marketing technology and all its benefits:

• Unless you can program using HTML, HTML5, CSS or PHP yourself, do not let someone create a static website for you that requires programming language to add content, images, or pages. Today you have an abundance of options for building a CMS (content management system) site, from richly designed Wordpress environments to Joomla, Drupal, Radiant, Silver Stripe, and CMS Made Simple.
• Have a professional website designer design and produce your website using a mainstream CMS tool. Then have her train you how to use the back-end for your day-to-day operations. After that, you need to use your website professional only for more complicated tasks, such as adding new functionality or changing your design on an as-needed basis.
• Yes, you need a Facebook page. If you’re not sure how to set it up yourself, this is a great task for a social-media-savvy college intern. Just getting a page up and running, adding pictures regularly, and beginning to have conversations with your customers is an excellent start.
• If you want to add more exciting options to your Facebook presence, such as integration with your website, catalog pages you can sell from, newsletter signups, promotions, forms, surveys, and campaigns, you may need to hire a professional. But you can add these features to your Facebook page as your customer list builds, so you can be sure to reap the benefits—and have the development pay for itself—as quickly as possible.
• Using a tablet computer, such as an iPad2 or a Droid device, is a fantastic way to show your work without carrying your entire line. But…you need a full catalog of quality images for this to work. You can download images directly to your device or create an online image catalog to which you can easily connect.
• Unless you are a retail store—or are doing a high volume of online sales—you probably don’t need a mobile app right now. But custom mobile apps will be considered as commonly required as websites in a few short years. Right now, spend your time using other companies’ mobile apps and getting comfortable with how the world of mobile marketing works. When the time comes to do it yourself, you’ll know what to expect.

The internet has moved off the dirt roads of its infancy and is now offering a smooth interstate experience at high speeds. If you’re still driving a horse-drawn hay cart and trying to keep up, you’ll not only be left far behind, but also be engulfed in your own dust.

Quick. Take out your smartphone. Open your website. What do you see?

If your website seamlessly reconfigured itself to be easily readable on your phone, you're in good shape. This automatic sizing is called responsive, and it's what website visitors demand today. If, however, your reading panels are too wide, if you have to move your phone into landscape mode to read the text, if your pictures run off the sides, if you have to squint . . . you have pretty much demoted your own site to the nether regions of Google search.

Why? Because 98.3% of smartphone owners use their devices to access the internet. So Google - which has a vested interest in delivering good search results - is taking its belt to sites that haven't upgraded to responsive design. If your site won't automatically reconfigure itself to any device of any size, you need to fix it now.

Consider this more of a PSA than a blog post. Let's get on this folks.

[00:00:00.060]
The things we can do to stay sane and stay in business during this sort of crazy time today, I'm going to talk with you about a handful of marketing things that you can do right now that are pretty safe to do right now. But a couple of housekeeping things. First, there will be a webinar tomorrow, Thursday, what is the date? Tomorrow, March 20 26 at 11 a.m. Central Time. And it's part of my majesté webinar series, which we will now be doing free for everyone every single week.

[00:00:33.870]
Tomorrow's session will be with jewelers mutual, several people from the jewelers mutual team and also with Sarah Yood from JVC. And we'll be talking about insurance and legal issues you need to be aware of. OK, so what are some marketing things that you can be doing right now? Because we're trying to think in five day increments and business can't stop entirely. So you need to market. But how do you do that? Well, in this moment. The first is that you can sell, but you need to sell with some caveats.

[00:01:06.630]
So you need to be aware that tone and message are very important right now and also that the population at large is very much in conflict about should we shut down, shouldn't we shut down? And there are opinions on both ends of that spectrum and everywhere in between. And you need to make sure that you are not setting out a tone deaf message when you do this. So when you're selling, I wouldn't be doing a bunch of promote, promote, promote products right now.

[00:01:39.820]
I don't think that's the best use of your marketing time or energy. And also, it risks making it look like we're in business as usual and everybody knows we're not in business as usual. And they they expect you to recognize that we're not business as usual. It's OK to say things like, look, we're here and we're available. If there's something you need, those kinds of messages are great. I would advise that you have some sort of a safety manifesto on your website or as a link that they can get to to see what you are doing, because there are a lot of landmines that you can step on when you're selling.

[00:02:18.240]
Right now, for instance, we've had people's customers tell them, well, fine, you can ship it to me. Don't you care about those UPS and FedEx drivers? But how are you treating your employees? Are they safe? Is your bench jeweler safe? So people are thinking about a lot beyond just the jewelry delivery. So share what you are doing. If you have staff that's working with you, share what you're doing to protect them, share what you're doing to prevent the spread of infection yourself.

[00:02:47.370]
How are you behaving so that you don't contribute to a problem, share how you leave things out for your delivery drivers instead of encountering them face to face, how you've arranged with them to pick up with having to interface with you directly for shipping jewelry. This gets challenging because there are signature requirements and things like that. But work with your shipper and with your insurance provider to know exactly what you can do to avoid contact and still be covered and then share that with your customers so that they know you are thinking about more than just earning money for yourself, because that's that sort of don't be selfish message is out there.

[00:03:28.710]
And for the people who are paying attention to it, it can really affect their perception of you as a brand. So sell but sell with some caveats and a lot of communication about how you are selling as a responsible citizen. In today's moment. It's also really important to stay in your lane. If you're not a medical professional, then it's not a very safe thing to be talking about covid-19 as a in a marketing type of presentation. So if you are, you know, if you have decided to do a certain practice and share the link to the resource that you used for it, share where you got your information from, be transparent.

[00:04:15.270]
Transparency is really important right now because information is changing constantly. So you can say this is the best information I have right now and this is where I got it from. And then that way you're staying in your lane. You're referring to professionals who have given you advice and it just it protects your brand and it protects you. And it's the right thing to do more video right now. You could be doing a lot of promotion on video, just like I'm doing now with this little twenty dollar camera and the microphone that's built into it.

[00:04:48.480]
So it doesn't have to be a great production. You can see no one did hair and makeup here, but communicate with your community a lot more using. Or social media channels or using one to one meetings there. It's a great time for you to have conversations with your customer using Zoom or Vector or go to meeting. I've noticed Google Hangouts is really buggy at the moment. I think there are just way too many people using these free channels that the channels aren't accustomed to this much traffic.

[00:05:24.660]
So I'm noticing that we're not getting great reception on our Google Hangouts channel. There are lots of affordable one to one and group meeting tools that you can be using and you can use those with your customers. So share video on social media. Do Facebook live if you want to do LinkedIn live. That's a great option also. But you have to sign up for it. You have to go to LinkedIn. And if you type in the search term for LinkedIn live, it'll show you the directions to a page where you can share what you're going to use LinkedIn live for because it's not automatic, like anybody can do Facebook live, but not everyone can do LinkedIn live and then put little videos up on your social channels talking about what you're working on and what your challenges are right now.

[00:06:08.250]
And those are all really good ways to connect. But video is a powerful way to connect in this moment. Oh, if you are using social media schedulers to have, like, meet Edgar or HootSuite or any of those, if you've got content scheduled out, go look at your content. Q It may be time to clean up that queue or even suspend the Q or replace some of the information in the queue because messages that made sense, you know, even three weeks ago may not make sense today.

[00:06:39.870]
They may be tone deaf today. So, you know, make sure that you take a look at that. Q If that's something you use, also make sure all of your messaging is in brand. Now, that is a very individual thing. Your brand is specific to your presentation. So if you're typically funny, be funny. If you're typically quirky, be yourself. If you're typically serious, be serious. If you have a tendency to be political and people know you for that, then don't stop being who you are.

[00:07:09.540]
Just make sure you're in the brand that you've already established with your customer base. If you have been very careful not to share sort of a personal or personality with your community before and now you're starting to do video, your personality is going to come through. So make sure you think very carefully about who you are and how well your customer base already knows you so that you can stay in brand and not, you know, slip off into some messaging or some portrayals that actually won't work for your customer base.

[00:07:45.810]
And finally, in your marketing efforts right now, this is a really great time to be about your community. We're all trying to think of ways that we can help or improve the current situation, make that part of your communications, share what you're doing. Like Lauren Harper, they're making masks and they're shipping off batches of them to places that need them. And that's part of her marketing, but it's also part of her brand and part of her personality.

[00:08:11.520]
So as a designer, that really works. I've noticed that models find Glaucus is doing the same thing. They're deep into making masks because that seems to be where the greatest addressable need is at the moment. So find an addressable need and work on that just because it's the right thing to do. We all need to pitch in right now and then also share that information with your community so that they can participate with you if they want. They can share more ideas with you.

[00:08:38.070]
If they want, they can just cheer you on if that's what they've got to offer. And it helps us build connections for later. So sell with caveats. Stay in your lane, watch your messaging. Don't be tone deaf. Be aware of the fact that there are lots of people out there who may view this whole experience differently than you do. Keep the messages within your brand. And if you haven't thought about what your personality is as it relates to your customers, hone in on that right now and try to do things that are community focused.

[00:09:07.680]
And those will be very good marketing activities for right now. Remember, we're working in five day increments. So that's something you can do right now that will be meaningful. And again, please join us at the webinar tomorrow where we're going to be talking about your insurance requirements and some legal questions. And at work start world. You can also see the rest of the webinar series that we're about to offer. So that's it for the moment. Thanks bye.

Microsoft recently announced that Windows 10 will be the last Windows version. Don't get all excited you Microsoft haters - Windows isn't going away. But Microsoft is choosing to go with a cloud model for all future Windows development.

The best analogy for what will happen is to compare Gmail or Apple Mail to Outlook. If you use Gmail or Apple Mail, you know they are updated all the time. New code is developed and released when it's ready. If you're an Outlook user, you know that you get a new version of Outlook any time you buy a new version of Windows Office, update your PC, or pay for an upgrade. For some of you that may mean every year, but for most of you that means every two - four years. 

Considering the current pace of technology innovation, two years is a long time to wait for updates, and four years is far too long. Apple knew that when they standardized their operating system with OS X, and now Microsoft seems to know it too. So the future of Windows will be a future of updates and improvements delivered whenever those updates are ready for market (or released, because sometimes ready and released are not the same thing).

This one announcement doesn't affect you if you're not a Windows user, but it is still important to you. Microsoft is making a massive shift in the way they develop software and make money. They are betting their bottom line on the premise that yesterday's technology may already be obsolete, and that technology from two years ago certainly is.

So. How old is the software you are using for your business? Do you have a Point of Sale system that was written in Access? Is the version you're using of Quickbooks pre-2007? How up-to-date is your internet browser? And how old is the technology your competitors are using? If your competitors are committed to staying current on software, there's a good chance they have operational and marketing capabilities you do not have.

Software companies have been moving their development to cloud platforms for roughly a decade now, and in the past three years that pace has accelerated. What this announcement by Microsoft means to you is that the writing is on the wall. Businesses need and want software innovations from their chosen software providers as fast as they can get them.  If your business is committed to a software provider that is falling behind, the time to reevaluate that relationship and commit to software that's ready for the next phase of business development is now.

What is 2FA?

You’ve been using 2-Factor Authentication (2FA, also sometimes called Multi-factor Authentication) for a long time, though you may not even realize it. Every time you use your ATM card, you present the card (factor 1) and you use a pin number (factor 2). Even if someone steals your ATM card, it’s only useful to them if they also know your pin.

That’s what 2-Factor Authentication is – a security process that requires two forms of identification from two separate categories of credentials. The 2-Factor Authentication used by your bank for your ATM card doesn’t make it impossible to steal cash from your checking account, but it makes it much more difficult.

You should be using 2-Factor Authentication for your most sensitive internet access points as well. “But wait!” you say. “My online banking doesn’t use my ATM card, and no other internet provider uses a plastic card either!” And you’re right – plastic cards are not the medium of the internet – they’re the medium for physical machines. But you have another credential device you can use, you likely have it with you all the time, and you already know how to use it.

It’s your mobile phone.

At its most simple, 2-Factor Authentication uses a text message. You enter your username (factor 1a) and your password (factor 1b), and then you receive a text message with a code to enter (factor 2). The average hacker won't be able to access your account even if they have your username and password, because they don’t have your mobile phone.

You can also use a 2-Factor Authentication app to receive your authentication codes. A 2-Factor Authentication app generates a temporary login code, in sync with the site(s) you program to work with it. The codes refresh every 30 seconds (you don’t have to do anything – they just automatically refresh every 30 seconds, 24/7). So instead of triggering a text message when you log in, you input your username (factor 1a) and your password (factor 1b), and then you get the latest login code from your 2-Factor Authentication app.

The text version is easiest to set up, but sometimes you experience delays. The app version will not suffer from any delays in text relay, but the apps are a bit more difficult to set up. In reality, you will end up using a mix of both. For instance, Twitter only offers text authentication, but if you use LastPass for your password management, you will need an app.

Unfortunately, 2-Factor Authentication isn’t available on every website yet (the most notable gap is banks, which have been terribly slow to implement 2-Factor Authentication for their online services), but adoption rates continue to climb.

Which 2-Factor Authentication app should I choose?

The five most popular are Google Authenticator, Duo, Microsoft Authenticator, Transakt, and Authy. These are all free and all work well. Each one has a bit different approach to setup, so be prepared to follow their instructions carefully. It’s not difficult, but it can be confusing the first time you do it. So take your time and read the instructions once or twice before starting.

Why Do I Need 2-Factor Authentication?

I was talking about 2-Factor Authentication with a business acquaintance last week, and he said, “2FA is stupid. If a hacker really wants to get into your system, 2FA won’t stop him.”

This is true. If hackers really really want to get into your computer, they’ll get in. But the hackers who have the sophistication to beat 2-Factor Authentication are going after big targets: Discover, AMEX, the Social Security Administration. Hackers work for one of two things: notoriety or money. Your personal accounts are unlikely to deliver either (unless you are Bill Gates. And Bill, if you’re reading this blog, can we talk?). Does this mean you don’t actually need it then? Not really. You still need it.

Here’s an analogy to explain why. My granddaughter and I recently stopped at Walgreens to pick up some prescription allergy medicine. It cost $4.00. It was in the little paper “I’m a prescription” Walgreens bag. When we got out of the car at our next stop, I asked her to please put the bag in the glove compartment.

“Why?” she asked. “It’s not worth anything. We could always get a new one.”

“Because I don’t want to pay the deductible for fixing a broken car window,” I replied.

The world isn’t just filled with sophisticated hackers. It’s filled with baby hackers; perhaps the kid next door, one of your students, or one of your kids’ acquaintances. These baby hackers might be working themselves up to something Department-Of-Defense-worthy, but right now they’re just practicing. Don’t let them practice on you. 2-Factor Authentication will stop this type of hacker.

2-Factor Authentication will also stop the robot hackers that are programmed to breach as many accounts as possible looking for big fish. But just as catch-and-release still leaves a hole in that poor fish’s mouth, these robot fishermen tend to leave messes behind in the accounts they break into – messes that can lead to anything from minor embarrassment to computer replacement or costly computer repairs.

Finally, if you have a website, it is always at risk of being infected with a socially engineered Trojan. This is a hack that creeps into your website and then tricks unsuspecting visitors to download a piece of malware. By the time you find out it’s happening, Google has blacklisted you and your customers and visitors are angry. Using 2-Factor Authentication to access your own website administration area will deter these kinds of hacks from all but the most motivated hackers.

So while it’s true that 2-Factor Authentication won’t stop the best hackers, it can still save you a lot of time, frustration, money, and loss-of-face.

Which accounts should I protect with 2-Factor Authentication?

You don’t have to protect every access point. The average internet user has somewhere between 35 – 50 online accounts. Here’s a list of the account types you should provide with this extra layer of security:

• Online email accounts (Gmail, Yahoo, AOL, Live, Hotmail, etc.).
• Password protection systems (LastPass, Dashlane, Keeper, Authentic8, etc.).
• Cloud storage (Box, Dropbox, Google Drive, OneDrive, etc.).
• Online bank accounts (And if your bank does not offer 2FA services, use the contact form on their website to say you want them to do so for your protection).
• Any social media accounts that you use for business or which are particularly important to you..
• Your website (Wordpress, Joomla, Drupal, or any CMS website with back-end access and/or a database).
• Your hosting and domain providers (GoDaddy, MediaTemple, Amazon Web Services, Rackspace, etc.)
• Cloud-based business services (Quickbooks Online, Salesforce, etc.)

You can certainly protect more than these, but at a minimum you should use additional security to protect your money and your business interests.

How do I start the process?

A good place to start is with Facebook or Twitter. Most people have at least one of those, and both sites use text message authentication. Once you set up your first account, the whole concept will make more sense to you. Here are links to step-by-step instructions for each:

How to set up 2FA on Twitter

How to set up 2FA on Facebook

For all other sites, just google “instructions to turn on 2FA in XXXXXXX” and you’re likely to find what you’re looking for. I wish I could be more helpful on this point, but with so many different sites to choose from and so many different approaches, being more specific would make for a very long blog post!

When you use 2-Factor Authentication it does take a few more seconds to access your protected accounts. But you quickly get used to grabbing the additional code from your mobile device, and saving yourself from just one hack will more than compensate for the few extra seconds of security. The internet keeps evolving and so must we. Right now, your best bet for protecting yourself online (in addition to good password behavior and hygiene) is 2-Factor Authentication.

**************************************************

 Update 2020-7-29

A reader requested an update on this article, after realizing it was five years old. In truth, very little about using 2FA has changed since 2015. The encryption and coding behind it have been hardened, but as users, things function largely the same way.

One way in which 2FA is changing is that some software systems - notably Google, Dropbox, and Amazon - are using push inquiries to their mobile apps now instead of sending a code through text.  For example: If you are logging in to Dropbox on your desktop, instead of sending a text message, if you have the Dropbox App installed on your mobile device, they push a question to your app asking, "Are you trying to log in from such-and-such computer right now?"  And you have the option to press "Yes" or "No."

But text authentication is still the dominant mode as of this date.

Everyone wants to know:

• What is the future of retail?
• Who will tell us what it looks like?
• What do consumers really want?
• How do we remain relevant?

These are urgent questions. How we get products to consumers has changed dramatically and forever, and a big chunk of our economy hinges on how well we respond to the changes. I think we can all agree that a retail future consisting entirely of Amazon, Walmart, and eBay wouldn’t be healthy.

In the meantime, our supply chain structures are wobbling. In the blink of an eye, consumers saw and embraced the opportunity to acquire what they want, when they want it, from the comfort of their own home, in their cubicle, or while watching the kids play soccer. The industry has primarily tried to address the problem with lower prices and price competition (“Beat the Internet” anyone?), but all that has accomplished is to strip economic value out of the supply chain.

The stress of technology-driven business change is so intense, that perhaps we don’t realize that other people in other times have gone through the same issues. Different technologies, but the stakes were surely the same to them, as were the challenges.

I can almost imagine how it felt to be alive when Guttenberg’s printing press came online. Printing presses democratized knowledge and changed the way we learn, educate, write, and think. The parallels to the way computers have changed our world are very strong, even though this happened nearly 600 years ago. Guttenberg’s invention came in the middle of the Renaissance, a time most people think of as being the cultural bridge between the Middle Ages and modern history. But we also know that the Renaissance was a time of deep nostalgia for the past, accompanied by a feeling of ennui about the future and the advances of humanity. Sound familiar?

Beyond the printing press, the Renaissance was a time of absorbing new knowledge – primarily mathematics (until then the purview of Arabic peoples). Mathematics and logic transformed thought and behavior, much like modern computing has changed thought and behavior (and without which, modern computing could not have happened). The philosophy of humanism was developed during this time, as people shifted from thinking merely about survival to what it meant to live well. There was an explosion of new techniques in architecture and art, and writing was completely transformed. While some bemoaned the death of poetry, others saw brand new figurative horizons opening before them. Again, sound familiar?

Renaissance history is a favorite study of mine, but it’s also an appropriate analogy for today. For one thing, it reminds us that history has been fraught with dramatic changes, and that humanity continues to plow forward; learning, prospering, and evolving (often despite ourselves). But another comparison is also apt: At its heart, the Renaissance was a period of rich and productive collaboration between thinkers of every discipline. Artists, mathematicians, philosophers, writers, and scientists shared ideas across disciplines, which led to an explosion of human knowledge. Each person, immersed in his individual discipline, was unable to see the bigger picture. The potential for progress emerged as they threw their ideas and questions and insights into the middle of the table and put them up for discovery and debate.

Today we are confronted with multiple challenges to business-as-usual. Technology hasn’t just changed the way we shop; it’s changed the way we think, learn, write, communicate, and socialize. Just as the introduction of math disrupted and changed all the other disciplines 600 years ago, technology has done the same for us (not to us) today. And I believe the way to address that change is to embrace it – with heaping helpings of collaboration.

Just last week, a retailer said to me, “You’re saying that marketing today requires extensive knowledge of how to do online marketing. I’m already too busy. How can I learn to do all this too?”

To which I said, “You’re asking the wrong question. Don’t ask ‘how do I learn to do all this too?’  Ask, ‘how do I find the right people to collaborate with?’”

Small business owners fence themselves in with the idea that they must do everything themselves. Instead, we should be seeking every possible collaboration. Collaboration allows us to focus on what we’re good at, while tapping into what others are good at. In the process, we all learn, and that learning happens more gracefully because it’s not overshadowed by the intense pressure of time and expense (or risk).

In some respects, this is already occurring. Significant numbers of workers have shifted from being employees to being contractors – in essence, providing their collaboration for a fee to companies who need their talents. The ubiquitous cloud is another form of mass collaboration; instead of companies housing and managing their own servers and software, they contract for portions of servers and subscriptions to software, leaving it to the service companies to manage their own software, hardware, and the constant advances of technology.

How can the jewelry industry embrace more collaboration? One obvious way is to create more marketing and selling synergies between individuals, organizations, and parts of the supply chain. The emergence of omni-channel strategies will further disrupt the notion of the traditional supply chain, forcing our current distribution networks to innovate or fail.

The retail store as we know it is almost entirely a construct of the 20th Century. Something else will be next. The word Renaissance literally means rebirth. The outstanding contribution of the Renaissance was the leap forward in human understanding, the mechanism was collaboration. It’s time for our own Renaissance, and I think the nexus, this time, will be rooted in collaboration as well.

Part II of this article: Collaborations to Watch

. . . and why should I worry about it?

Some software you buy, and some software you borrow.  

For instance, when you buy a copy of Microsoft Word or Intuit Quickbooks, you are buying that license to use for as long as it works for you (and as long as you don't violate the terms of the agreement by doing something like installing it on a lot of different computers instead of the one you bought it for). If you want to take advantage of upgrades and new features, you buy a new copy. You haven't bought the software code - just the application.

Some software, primarily more complicated software like business systems (Great Plains, Oracle, iDiamondCloud, Navision, The Edge, Hansaworld, Diamond Counter, Jewels2000, etc.), is typically licensed for a period of time. Your license will come with certain requirements (number of users), certain expectations (like how much you will pay each year, or not sublicensing or transferring the software), and certain benefits (updates, support, improvements, bug-fixing).

This article isn't intended to tell you about how to negotiate your software license - that's a really big article. I just want to make you aware of one element that should always be included in your licensing discussions:  Escrow. Just like you may escrow money for real estate taxes and home insurance in your mortage payment, you should have an agreement that provides escrow for your software code. An escrow clause allows for a fully uncompiled copy of the code to be held securely by a third party, typically requires an updated version of the code to be stored on an annual or semi-annual basis, and has terms that define the conditions of release to the licensee.

Why Do You Need an Escrow Clause?

Many mortgage bankers want homeowners to escrow real estate taxes with them, because they know that if the homeowner gets behind on taxes the municipality will have a claim on that property - a claim the bank doesn't want them to have. Mortgage escrow is a security feature for bankers.

Likewise, when you make a signficant investment in software, you need security too. Your investment won't just be in terms of licensing costs, it will also be your investment of time to learn the software and time to adjust business practices - and in many cases this investment is equal to or greater than the cost of the software itself. Then, the more years you use the software, the more enmeshed in your business that software becomes.

So what if the software provider simply ceases to exist? What if they stop providing updates or improvements for an extended period of time? What if the software provider goes into financial distress? What happens to your software?

You Don't Have the "Real" Code - You Have a "Working Copy" of the Code

Are you thinking that you could just have a new developer pick up where the software provider left off? Not likely. You see, in nearly all cases of commercial software licensing, you don't have the "real" code, you have a compiled version of the code. You have the part of the software that works - that does something - not the part of the software that provides all of the instructions to make the code work.  The other part - the programming part - software developers carefully protect. 

So if your software provider goes belly-up or fails you in their obligations, you need to have two options available to you. The first option is to consider a different software and go through the process of change (and if you don't have an escrow agreement, this is your only option). But if you have the software in escrow, you have the option to take control of the code, hire or contract your own developers, and continue tweaking, bug-fixing, and improving it.

This aspect of source code escrow is just a tiny part of the overall software licensing process, but it's an important element that is nearly always forgotten unless a business owner thinks to include a lawyer in their licensing agreement. Don't let software vendor failure leave you with only one option - make sure you include an escrow clause and protect yourself as well as possible. 

Here is a link to an excellent article on software licensing. Save the link - you may not need it now, but it will come in handy as soon as you do.

It was all over the news this month - Verizon Communications will buy AOL, Inc. in a $4.4 billion deal. Yes, this is big news for investors and Verizon competitors, but does it matter to you? It certainly does, and here's why.

Content Content Content (but this isn't the main reason)

The mobile market, dominated by Verizon, Sprint and AT&T, is fighting harder and harder for market share now that nearly everyone who wants a smartphone has acquired one. So how do they grow? They grow by competing in two areas: content and advertising. And the reason that content and advertising matter to the big mobile companies is that content and advertising matter to consumers. In 2013 (the last time we have numbers for this statistic), less than 35% of smartphone users reported they used their phones to make phone calls. You can see why that matters to the big mobile companies. But it also matters to you. Because what are they doing on their phones? They are accessing content.

AOL may have fallen off your radar, but one of the reasons they matter to Verizon is that they own some big content providers, like Huffington Post and TechCrunch. If Verizon is willing to spend $4.4 billion to acquire a company that looks like a has-been, you can bet your lunch money that they've studied this acquisition and decided it makes sense to them. They are betting that consumer hunger for content will only continue to grow. Sure, they could be wrong, but the folks at Verizon have been very smart so far, making less mistakes than your average bear. So tuck this in your idea bank: content matters now and it will matter more in the future. Ask yourself how you can participate in the content marketplace in the years to come.

Advertising Relevance

Another thing that AOL has and Verizon wants is the ability to sell and serve ads. We all know why selling ads matters. But what about serving ads? 

Think about this: The last time you considered buying advertising for your business, did you think about going to Verizon? Next time, you should. AOL earned nearly $1 billion last year from advertising revenues on sites that it owns, and another $856 million selling advertising for third party sites. That's a lot of consumer eyeballs. Even more important, the technology that AOL has developed for selling and delivering ads is very advanced, enabling them to slice and dice and target consumers better than most other advertising companies. Because of AOL's innovations, using technology to manage advertising is not only making targeting better, it's lowering the cost of advertising overall. Expensive human management has been replaced by algorithms that can decide in a split-second which ads to show each time a web page loads. 

Now that you're competing with businesses all over the world (and you have been, for much of this past decade), you can't just sit around and wait for consumers to remember you or to find out about you. You must advertise. But today's consumers are busy and distracted and they have no patience with irrelevance. You can get their attention though, if you catch the right people at the right time with the right message. Verizon is betting big that AOL's advertising technology is worth a lot of money. You should be betting that too. If you're not doing so already, start thinking about how your business can stretch its advertising wings and use the internet to reach more relevant consumers on their phones and tablets. 

Pay Attention to Video

Verizon believes that video will be one of the primary reasons people use smartphones in the years to come (AT&T believes it too). Verizon has already developed plans to launch a video service specifically geared to mobile devices. Enter AOL, which has created some nifty tools for delivering video advertisements. Their technology makes it easier for ad agencies and brands to enter the video advertising space.  Why does this matter to you? The consumer appetite for video seems to have no limit. If you're not already looking at ways to use video for your advertising, it's time to start. The tools to shoot and edit video are getting less expensive all the time, but it takes experience and skill to pull off video offerings that appeal to consumers.

When a solid company like Verizon, with deep pockets and lots of research staff, decides to invest in online advertising delivery, video, and other content, we need to pay attention. They have done the analysis and decided that mobile content is where all the consumers are going to be in the next few years. If they're right, then small business needs to be there too.