How To Take Risks
Taking a risk isn't always easy, but innovators believe people who don't take enough of them in moderation can often stifle the growth of companies, brands, and even themselves.
Marketers know they must compete with thousands of hours of YouTube videos and millions of minutes spent on Facebook and other social sites daily. In the McKinsey Quarterly, Tim Koller, Dan Lovallo, and Zane Williams explain the overlooked "countervailing behavioral forces," often heightened by the way companies structure their reward system. This can breed risk adversity or unwillingness to tolerate uncertainty, even when a project's potential success far outweighs its possible losses.
The trio discusses the correct level of risk depending on the size of the investment, and how CEOs making decisions about large projects are typically more risk-averse than overconfident, because failure would cause financial distress for the company and its investors.
Failure, however, can sometimes become our greatest teacher. One of the best features of Internet marketing remains the ability to identify through AB and other forms of testing why paid-search campaigns or display or video ads don't produce the desired outcome or conversion rates.
Data presents risks. Jay Ku, head of corporate partnerships at Good, said the challenge remains communicating the outcome or challenge from collecting and applying the data in marketing campaigns, from search to offline, so that people understand the benefits. The VONS grocery store chain, for example, provides a new custom coupon service, Just for U, aimed at consumers who sign up online for deals. No printing or clipping required, but rather the club card number links to the plastic card swiped in the store.
Take a risk today. No matter how small.
Here's a little inspiration. Talia Castellano took a risk and put her story online. Her YouTube videos began as mini makeup tutorials, calling makeup her wig. The 12-year-old started Angles on YouTube in September 2011, and wants to become a celebrity makeup artist, but standing in her way are two aggressive types of cancer -- pre-leukemia and neuroblastoma.
Living with cancer for five years, earlier this month Castellano got news that the cancer had spread to her bone marrow. In a recent video she talks about contemplating a bone marrow transplant, and says that if she decides against it, the doctors give her four to 12 months to live.