Osram Case Study - How to Pitch the Idea ?
Let’s get started with the story. So this is a story that dates back to early 1900. This was a time where in the electrical revolution was at its peak, and light bulbs were considered to be technological marvels. During this time, every other company was out with new versions of light bulbs, and market ears were very desperately trying to convince anybody and everybody who could be their customer.
During this time, just like every other salesman, they did not get any attention and people just shoot them away. During this time, the industry standard light bulb was the tungsten filament light bulb. It was used in homes, offices and even warehouses and factories. But a British company called Osram came out with a game changing invention. They invented the low energy, low cost light bulb. These light bulbs were 10 times more costlier than the constant filament light bulb. But they used only 20% of its energy and lasted 50 times longer. Now, when the osram guys did their market research, they understood that these light bulbs will specifically benefit the warehouses and the factories, because when it comes to homes and offices, people had only one or 2 bulbs in the room. But when it comes to warehouses, they had hundreds of bulbs, and each of them was placed at a 30 feet height. So when they needed to change the light bulb, it was like a very, very tedious procedure. And they had to specially employ labors just to change the light bulbs frequently. So the osram company decided to target the warehouses and the factory specifically.
But when the marketers tried pitching their idea, the major problem that they faced was the maintenance manager who said that the finance Department had given him a very strict budget and they would never approve to spend 10 times more money just on bulbs, So they said, Okay, cool. And then they spoke to a finance guy. The finance guy said, I don’t know anything about the lightbulbs. Please go ahead and talk to the maintenance guy. So basically this was like the American version of FBI.
This was the same case with all the other factories and warehouses, and the osram company couldn’t make their sale. So after multiple failures, they came out as a brilliant idea. You know what they did? They sent a magical letter to both the finance guy and the warehouse guy. And suddenly, within a month, they started getting orders.
And soon enough, hundreds of factories all across the country had Osram bulbs. The question is exactly what was so special about that letter that it was able to convince these guys so easily. As it turns out, what the osram guys did was they sent a cash box and a letter to the finance guy. The cash box was locked, and the letter said that this box contains an idea that can save you 50k euros a year And the key to this box is with the maintenance manager. The maintenance manager also received a similar letter wherein the letter said that the box is with the finance guy. So merely out of curiosity, these people got in touch and they opened the box. In that box, there was another letter, and this letter gave them a detailed calculation about the costing of the new bulb and how much will it save in terms of Labor, in terms of bills and in terms of maintenance. The last line said, this Bill will save you 50k euros a year. If you’re on board, Let’s get in touch. And the contact details were mentioned.
And that is how both the finance guy and the maintenance guy had a discussion about the feasibility of the procedure, and they presented the same calculation to the upper management and the policy got approved like this. This is how Osram was able to make a million dollars just by giving different calculations to different authorities depending on the size of their factory and the size of their warehouse.
Now, if you take a step back, this story has got three very important lessons that you need to learn before you pick your idea.
Lesson No. 1- Always talk to the decision maker.
Now, people, I’m telling this to you that the most difficult thing to do is not pitching your idea, but finding the decision maker who will either approve or deny your idea. And guess what? Today you have got this magical tool when in decision makers all across the world are just a few clicks away and this magical tool is LinkedIn. So if you got an idea, do your research and connect with a decision makers, drop them an email and see the magic happen. And just in case you happen to find that there are two to 3 decision makers, all you have to do is keep them a CC instead of sending them a cash box.
Lesson No. 2- Always start with the benefit.
In this case, had the awesome guys send these people a long list of calculations, nobody would have read it. But because they started with the statement this could save you 50k euros, they understood that the value of that lengthy information is 50k euros and hence they paid attention to those long list of calculations.
Now, when you apply this in terms of email, you got to understand that the subject line is where you’re supposed to present the direct benefit of your service to that company.
For example, if you’re applying to be the Su guy, your subject line could be this will increase your viewership or sales by 15%. And after that, when you put out your details in the email, people will actually care to read. Why? Because now they know the worth of that information.
When it comes to a client meeting, you got to pitch the benefit of the benefit in the first two minutes itself. Because trust me, people, regardless of who your client is, regardless of which business they belong to, the only thing that they care about is profit. And once they know what is the value of your analysis, they will automatically pay attention. Even if your presentation is a little boring.
Lesson No. 3- Convincing about how will you deliver upon your claims.
Last and most importantly, when you draw a calculated projection and prove how you can deliver upon your claims, there is nothing more amazing than that because it says how much you know about the industry of the client. Then most importantly, it says that you know what you’re talking about.
So this is how you can pitch your idea or your service, depending on your context, to get life changing opportunities. Above are the key lessons to be kept in mind to pitch your Idea.