How to Find Your Golden Goose: Start By Asking “What’s Your Iced Tea?”
What’s the one thing you do that produces almost pure profit and an amazing ROI?
How can McDonald’s make money selling $1 hamburgers? By selling you a $1 iced tea.
Could you make a hamburger for a dollar? McDonald’s makes anywhere from 6 to 20 cents profit off a dollar burger. But the dollar iced tea that’s mostly ice and water is almost pure profit.
Apply that question to your own life, finances, and work. The sooner you know your most profitable use of time, the quicker you develop your ideal “niche’’ in life (and work), the golden goose that will grow your fortune.
Essential questions: What’s your iced tea? What’s your burger?
Anytime someone wants to grow revenue, I ask them, “What’s your iced tea, and what’s your burger?’’ Related questions:
- What actions are the most and least productive use of your time? How can you do more of the most productive and less of the least productive?
- Is it billable? The magic question of creative agencies and law firms also means justifying your billables to your client (but also, ultimately, to your employer and yourself).
- Is this product or service a “loss leader’’ that helps you profit in other ways? Can doing this activity build your organization (or your own knowledge or relationships)?
“If you spend too much time thinking about a thing, you’ll never get it done.” ― Bruce Lee.
How Capital One perfected “the iced tea strategy”
How did Capital One Financial — launched in 1994 — become the nation’s fifth-largest credit card issuer and the 12th largest bank?
More than 20 years ago, Capital One didn’t even have a real bank. It was a credit card company that developed an innovative way to get more “profitable’’ customers while getting rid of those who weren’t making the company any money. Here’s how the system worked:
- Capital One “scored’’ every customer to determine which were most and least profitable, ranking them.
- Whenever a customer called the 800 number, the caller ID system and computers synced to let operators know the caller's score before the phone was answered.
- If the customer was “unprofitable’’ (for example, someone who paid their entire balance off every month), that data appeared on a computer screen and Capital One operators knew to “let them go away’’ if they called to complain about something.
- If the customer was “highly profitable’’ (for example, someone who paid their minimum every month but carried big profitable balances), Capital One connected the customer with a talented sales retention specialist who offered a lowered interest rate (or some other incentive to keep them).
“Amateurs sit and wait for inspiration, the rest of us just get up and go to work.” — Theodore Roosevelt.
Popcorn and other concession items are “the iced tea” of theaters.
Consider Paul Glantz, founder of Emagine Entertainment chain, which runs movie theaters across southeast Michigan. Across the nation, governors shut down movie theaters during the 2020 Pandemic.
But Glantz bet big on his industry, investing in taking over competition locations, converting even more theaters in 2020 to set up new Emagine locations. For a movie theater, “the iced tea” is selling popcorn and other concession items.
Emagine had a big challenge when Michigan Gov. Gretchen Whitmer allowed movie theaters to re-open on December 21 with the stipulation that they stop selling food or drinks.
Patrons were upset, calling to ask whether they could “bring their own” food. He asked whether Emagine could sell food and drinks people could take with them on the way out.
“Where your attention goes, your time goes” — Idowu Koyenikan.
What’s your greatest strength? Do more of what you do best
Imagine your child coming home with a report card showing two A’s, three B’s, and one D. Most parents would focus all of their attention and time on the D, making their child spend extra hours raising their worst grade.
The Strengthsfinder movement, developed by Gallup over decades, argues a person is actually most productive by focusing more time on the subjects where they are earning an A-grade (turning an A into an A-plus) and exiting the areas where they perform poorly. Build your strengths, outsource your weaknesses.
Since February, I haven’t been to my health club because our re-opened gym isn’t allowed to use the offerings I most appreciate: the hot tub, sauna, and locker room.
A hot tub, sauna, and locker room might not be considered essential to a gym (many health clubs don’t have them), but those three things are the only three things my gym offers that I can’t get elsewhere.
Exercise is the gym’s core business, but I’ve been exercising outside via long walks and outdoor work (without needing to pay a membership fee).
When you know your iced tea service or habit, you can grow your strengths and “outsource” your weakest areas to someone better suited for that other role.
Years ago, Motor Trend ran a feature called “Bang for the Buck” showing how a Pontiac Firebird delivered far more “horsepower per dollar” than a Ferrari. Focus on “bang for the buck” but also remember what you offer that no one else can.
“Amateurs sit and wait for inspiration, the rest of us just get up and go to work,” — Stephen King.
