Private-labeled products in specialized, captive distribution channels is not something new. Every grocery store has invested significantly to reposition their "generic" products in recent years to premium offerings. Outfits like Trader Joe's have taken that to an extreme and carry mostly private-labeled products. Certainly the buying power of a national grocery store chain can open some doors at suppliers and make private-label products possible. What about private labeled products for the rest of us?

Miami-based Vuru is selling nutritional supplements in personalized daily packs, packing them in cool foil wrappers. Pick any combination of their 2,000 name brand supplements and vitamins and voila! The cool thing to me was that Vuru operates an affiliate program targeting doctors, nutrionists, and others that want to create personalied supplement programs for their patients/clients. What if this concept was taken further and these items could have the brand name of the nutrition clinic on them, instead of Vuru. What if Vuru's pre-selected mixes (with names like "Women's Yoga Pack" and "The UrbanDaddy Pack") could be private labeled to other brands or "celebrities." You could market "Josh's Secret Formula" or an marathon training club could offer it's members supplements to assist in training. The appeal is the ability to have the scale of thousands of micro-sales-channels all leveraging the same backend operations infrastructure.

There are a host of "standard" products that could be marketed in these three ways: 1) personalized mixes for personal use, 2) mixes assembled by one person for purchase by another customer, and 3) mixes sold by third parties, under their own brand. Some of these are listed here:


Bottled wine sold under a private label in a restaurant or bar with the chef's special mix of Cab and Zin. Mosaic tile mixes selected by mom-and-pop home improvement stores and sold at retail and regional home fairs. Custom mixes of M&M colors (add in the custom imprinting for a double-win) created by school PTAs for fundraising. Paint color palettes selected and "renamed" by designers who market to their clients and their friends (why should Gretchen at Devine Color have all the fun?).

This is yet another way that the "small" guy can be enabled to look very big and provide a huge degree of value to their customers based on their knowledge of the market, not their knowledge of supply chain, logistics, and manufacturing operations.

Research is now showing that the top reason email subscribers give for opening and engaging with an email from a company was "prior value." So, if a subscriber received value from a previous email from a company, they are more likely to open the next. I was introduced to a new term/old concept today from Chris Baggott (who got it from Stephanie Miller of Return Path). Although this seems pretty elementary, its implications, which extend well beyond email marketing, are profound: you have to give value away before customers will be marketed to. To use an antiquitated metaphor, businesses must "prime the pump" to have marketing efforts (especially personalized, targeted marketing efforts) take hold. The virtuous cycle has to start somewhere.

Some companies provide prior the "sale" by offering educational content on their websites, free trials, "betas" of new software tools, cache (ie, invitation only gmail accounts), or by being something that the readers aspire to (either because of a strong brand, a fresh style, or irreverant, provocative content that is "right on" to your target audience). Seth Godin evangelized related concepts as Permission Marketing, but marketers need not have elaborate opt-in programs or sophisticated systems to utilize this concept. How often have companies gone to a trade show, published a brochure, or went on a sales call with the express purpose of creating value for the customer, so that they would get a second conversation, and a third? Like the samples put out in grocery stores, what value are you providing to prime the pump?



Picture courtesy of BrownBeagle.us.

Today, my Google homepage presented me two quotes of the day. The first was from Richard Stevens, creater of a Webcomic strip, where he comments "The only good ideas are the ones I can take credit for." The second was attributed to Samuel Goldwyn, the famous Hollywood motion picture producer and founder of several studios including Paramount and Metro-Goldwyn-Mayer. He said, "I don't want any yes-men around me. I want everybody to tell the truth, even if it costs them their jobs."

Except for the losing their jobs parts, I think it is funny that these were the two quotes today. One talks about having only "yes-men" who will allow you to take credit for every good idea (or limit the potential of the enterprise by letting you be the only one who can have ideas). The second talks about the power of truth (and perhaps the sacrifice inherent in it).

I just finished John Sculley's book Odyssey that talks about his time transitioning from an executive at Pepsi to being the CEO at Apple (infamous for firing Steve Jobs). I know it is a bit retro, but it was recommended and I found it interesting to read the description of a technology company from someone who didn't grow up in the industry. My favorite line of the book is a comment John made that some criticized Apple for being "a vertically-integrated advertising agency." I laughed because I think that criticism is more true today than it was in the time that Sculley was there.


Now, I should say that I am an Apple fan. I wish them well. I don't own a Mac. I have an iPod, but would consider myself a late adopter of it and even now most of our iTunes library was ripped from CDs. I am not a fanatic, but appreciate some of their innovations (like in product packaging and the cool graphic style they use in their ads, for instance).


That said, I wonder if all companies shouldn't strive to be called vertically-integrated ad agencies. Ad agencies love selling what sells. They love promoting things that make it big and make them famous. They love talking about products that coincide with social trends, consumer sentiments, and are seen as differentiated. Who wouldn't love making a product or service that ad agencies "wish they thought of" themselves?

So, I wonder if we spend enough time as thinking about what products we'd want to sell, if we had them, instead of what we are going to do to sell the products, now that we have them?

I have written in the past about online courses and virtual MBA reading programs that are available to supplement or sharpen your education. I would be remiss if I didn't mention that the Massachusetts Institute of Technology (MIT) has made ALL of their course materials available online for free in a program called OpenCourseware, including those from the Sloan School of Management.

If that isn't enough, the Small Business Administration also offers a host of online courses.

As everyone knows, Google is taking over the world. They run the biggest search engine and are buying up companies and extending their brand further and further each week. That said, there is a combination that I'd love to see that I call "AdWords in the Real World." As people know, AdWords is Googles way to insert advertising onto search results pages, onto blogs, websites, and the like triggered by the content of the page. Advertisers pay per click. Presumably, people browsing websites get relevant content and ads delivered to them (that is better than non-relevant ads, if you have to have ads). These AdWords enable a whole economy where people's websites can make money (or at least get supplemented) and advertisers reach those truly interested in their products or services.

So, this leads to my idea. As I have written about in the past, the book publishing industry is becoming frictionless. Anyone can write and publish a book. (Now, that isn't to say that everyone SHOULD write a book, but that is another tangent for another day). But for those who want to write, there actually is some friction to it. It still isn't free to publish and there isn't any truly revenue-share models that are aren't at least a little front loaded. So, what if advertisers sponsored "AdWords" in digitally printed, self-published books, the same way they sponsor links on a website.

An author would write a book about a particular topic, let's say about the history of musical instruments. They would prepare the book using one of the online services like Xlibris, BookSurge, cafepress, or iUniverse. They would select the "AdWord" option and their book would be made available for sale for free. Then, each time the book was printed on demand, trigged by an actual order, a dynamic list of current AdWords advertisers would be listed on a special sponsors page (with easy to type URLs). In its actual implementation, there could be a page of AdWords for every so many actual pages (ie, either in the back like the sponsors section of a high school yearbook or in the chapter breaks allowing the sponsor list to be even more targeted to the content of every chapter).

As long as the price paid for the book at check out covers all hard printing costs and royalties and the online book set-up was easy and "frictionless," I see that this could be an interesting opportunity to extend the Google AdWords to the real world.

The first advertisers I would solicit for this service would be the booksellers and authors themselves ("Readers who purchased this book, also loved this one, and this one"). I am sure there are many aspiring authors that would rather put their money into advertising their book, than paying set-up fees.

As any online merchant will tell you, the real trick to a successful online precense is the classic four P's of marketing: promotion, product (selection/quality), price, and place (in this case, being online makes this one easy, although having a short and memorable URL helps too!). The successful catalog and online resellers know that the key isn't necessarily having the largest selection of anything anyone would ever want, but rather having the products that someone wants and associates with your store.



Now, you can try your hand at product merchandising and category management with your own online storefront, without having to bother with inventory, fulfilling orders, or processing payment. Zlio is a French company that allows you to set up storefronts in an online interface that reminds me a lot of a blog. To experiment, I created a store called "Simply Baby" to try it out. I named the site, selected a template (or I could have edited the CSS), selected some products, and viola, I am an online merchant (as the French would say). The products are sourced from dozens of merchants (like Amazon.com and BestBuy.com) and the business model is based on Zlio sharing the affiliate revenue with the person who set up the site.

To be fair, the interface was slow (probably being served in France) and I found the searching for products a bit cumbersome (which is why my product selection on the site leaves a lot to be desired). After I started, I realized that their storefronts are better suited for a single category of product (ie, a Sudoku site or products related to baseball). I found the "Powered by Zlio" too bold and intrusive (especially since they have a revenue share business model). This said, I think this is very intriguing and will undoubtedly take shape.

eBay lets merchants create stores, but I believe it is limited to your own items. What if you could create a store of items that other people are offering? What if Zlio or someone like them allowed you to aggregate offerings from multiple stores, online auction sites, and your own items merchandised together? Why not go ahead and partner with GoDaddy or Network Solutions to integrate a URL registration into the check-out allowing people to set up their store under a unique URL (so that they could lose the .zlio.com part of their store name)?

I am attracted to models where the company wins when their customers' win. I think that is what has made eBay so successful. Zlio, and others that might join them in this effort, may extend that business model further.