How much is your ego costing you?
One of the first lessons I learned about marketing is something I learned at Extreme Dodge.
My mentor, Wes Lutz — the owner of Extreme Dodge, and I were sitting in a Jeep Wrangler in the dealership parking lot. I forget if we were coming or going, or just driving around the lot talking about the cars. But, somehow Wes got the idea to put the Jeep in 4-wheel drive and see if he could drive straight up the rocky, grassy hill next to the parking lot. The hill was very steep, and I thought we were going to tip over. Behind the jeep, a huge wake of dust and gravel was shooting out. It was a great rush, and Wes was right, we made it to the top of the hill.
When we got up there, we could see the entire dealership down below. There was a huge sign saying Extreme Dodge, the bright white building, and a sea of cars below.
As we looked down at the bright new dealership, I said, why didn’t you name it after yourself? Why not call it “Lutz Dodge”?
Wes laughed and said, “First — that’d be a terrible name. Second — you’ve gotta separate your ego from your business.”
At that moment, I was a sixteen year old kid washing cars in Wes’ lot. I was pretty sure if I were the owner, I’d have called the place “Murphy Dodge”.
But, what Wes said stuck in my head, and over the years running my own company, Penguin Magic, I started to notice the role ego plays in business.
I think a healthy ego is a great asset in business. It can help you take action, and when those actions pay off, it can make a lot of money. But, it can also cost you a lot of money. Here are the areas where I’ve seen ego cost entrepreneurs money:
Advertising that gratifies the ego — Ads can be great for the ego. Be extremely careful when you’re proud of the adverting space you’re paying for. Advertising is supposed to make you money, not make you proud. If you’re sponsoring your favorite sports, why? If you’re a national brand, but only buying billboards in your local area, why?
Management-style that gratifies the ego — Employees can be great for the ego. Be extremely careful if you feel more central and important after you’ve hired someone. Ideally, the person you hire should be great, and they should be doing a big chunk of the work, making you feel less important. Hiring should damage your ego, not help it. But, many times, we hire people and then keep them in a situation that gratifies our ego — they report to us, we make the ultimate decision, we’re more important after hiring them. The problem is, in this model, we’re creating a bottleneck on progress (sub-consciously, this can be to protect our ego).
Spending that gratifies the ego — Any kind of spending can make us feel powerful, decisive, capable, and that’s all good for the ego. Try to notice what you’re feeling “proud” of, and attack it to make sure it’s the right decision for customers. My favorite question to prevent ego-based spending: Would our customers pay for this if they had a choice?
I’d love to hear your thoughts. Where else does ego cost us money as entrepreneurs?