Here are two things I learned yesterday:
1) If you swim at a reasonable pace and with your head in the proper position, the bubbles from your underwater exhalation glide neatly behind your ears, rather than straight up your nose and into your eyes.
2) The average incremental sales from a promotion is only two-thirds of the bump in sales volume experienced during the time of the promotion (with the other third being attributable to stock-piling during the promotion and, to a lesser degree, deceleration of purchases in advance of the promotion).
These lessons highlight well the month of January 2012 in my life. It has been jammed absolutely full of enthralling and mostly unrelated pursuits. I’m only taking three classes this term and I’m done with recruiting. This should be easy street, yet my time has not been my own. Where has the month gone?
First, all three classes are higher than average workload. Second, I’ve been helping some T’13s organize the Tuck Burns Supper and helping the PE Center organize the Tuck Private Equity and Growth Ventures Conference, both of which take place this coming weekend. Third, it’s been a highly sociable month, including: watching Tuck Hockey play in Montreal; a weekend at the Class of ’66 Lodge snowshoeing and drinking mulled wine by the fire; my first ever paid public speaking gig; a celebration party for the election of next year’s Tuck Rugby Captains; my wife’s and my birthdays; Tuck Winter Formal; a new Tuesday night Married Men in Business (MMIB) in Murphy’s tradition of celebrating the newly engaged members of our class, of whom there have been a few lately (there go the signing bonuses!) Fourth, it’s been a month of trying hard to get in shape and dealing with the repercussions of festive excesses.
This morning, being the glutton for punishment that I am, I signed up for more. I was too intrigued to miss the ‘Europe in the Global Economy’ mini-elective, which started this morning. So, I now have taken more credits than I need to. Smart? I’m not sure. But I’m delighted to be involved in the discussion. Today, we covered a brief history of the EU and talked about limitations in moving towards a United States of Europe, even if one’s view is that such an arrangement would be desirable. Here are some unrelated nuggets I found interesting: i) About 1% of all taxes in Europe go to the EU government (the rest go to national governments). Of this 1%, half is spent on agriculture, much of it on payments to owners of fallow land, making Queen Elizabeth II the third largest beneficiary of those funds. ii) Almost 6.5 million Germans died in WWII, compared to around 500,000 French. iii) While Austria’s GDP at the end of WWII was approximately equal to its GDP in 1886, British GDP actually grew during the war!
My classes are all great this term. My research-to-practice with Ron Adner (which I will blog about separately later) stretches my brain every time, and I always pick up diamonds of strategic insight from The Master. By the way, his book “The Wide Lens” is available for pre-order now and I would highly recommend it.
Sales Promotion is the highlight of my term, though, and one of the best classes I’ve taken at Tuck. I like it for four reasons: first, Professor Neslin is a wonderful human being; second, it is highly practical; third, it is in a field (CPG/retail) that I am fascinated by and thirsty to learn more about; and fourth, it draws together more classes from elsewhere in the Tuck curriculum than any other class I’ve taken. When thinking about running a sales promotion, almost everything from the general management curriculum here becomes relevant. Here are questions you might ask in this class, for which the answers can be found in the courses in parentheses:
- How can you price discriminate to maximize profit? (Managerial Economics)
- How do you know whether a promotional sign (without a price reduction) has a significant effect on consumer buying behavior? (Statistics)
- Is promotion the most important part of your business to spend time on? (Marketing / Analysis for General Managers)
- Can you build a model to optimize your spend on advertising to consumers versus offering promotions to trade partners? (Decision Science)
- How do you convince sales staff that they should not offer trade partners promotions when they are incentivized on sales? (Selling and Sales Leadership / Negotiations)
- How can you design an organizational structure and incentives to align sales staff’s goals with your brand strategy? (Leading Organizations / Leading Individuals & Teams)
- How do you think about building a brand strategy that optimizes the effectiveness of your promotional activity? (Strategic Brand Management)
- What competitive responses are likely in your market as a result of your decision to promote? (Strategy / Entrepreneurship & Innovation Strategy)
- What are the implications of your promotional decisions on your ability to meet demand and the costs of doing so? (Operations / Operations Strategy)
- How can you identify the most profitable groups of customers to target with a promotion? (Database Marketing)
It feels great to have all these threads from the curriculum come together in one place, and gives me great satisfaction to know that my business mind is far better developed for breaking down and thinking about a broad range of managerial issues than it was 18 months ago. Well done, Tuck!
Oh yeah, and I’ve just booked a Spring Break trip to Nicaragua with my wife and about 25 Tuckies. It’s going to be a BLAST!