A tough lesson from Fred Rosenthal

Last night I learned that someone who was very important in my business life had passed. Fred M. Rosenthal, owner of the first outside marketing agency I hired at Telecom Analysis Systems (TAS), died last November. He was 90 years old.

I first met Fred in 1984 or 1985. We were just getting TAS off the ground, and I needed some higher quality marketing materials than the ones I’d been producing on our Okidata dot matrix printer. While visiting customers in the Northeast, I saw some really nice brochures and other “collateral material” from another company in our industry, and when I inquired as to the source, I learned that they had been produced by a firm called Carol Marketing Associates (CMA). I knew immediately that my company would get a big boost if we could produce marketing materials similar to the ones I had seen, so I called Carol Marketing and scheduled a meeting.

A larger-than-life character

That’s when I met Fred Rosenthal. Fred drove down from his office in Connecticut to our tiny New Jersey headquarters. My first impression: Fred was a large man, both in physical presence and in force of personality. He was considerably older than me and came across as a classic New Yorker, with the stereotypical accent and direct manner. However, Fred seemed polite, and with whatever rough edges he possessed, he didn’t seem at all uncomfortable about dealing with a young black CEO.

We got down to business right away. I told Fred that I admired what I had seen of his work, and that I wanted to produce similar brochures and application notes for the TAS products. Fred of course wanted to know about our products, so with pride I told him about our digital technology, our use of groundbreaking microcomputer devices, our unparalleled precision and accuracy, and so forth. Fred stopped me mid-speech and gave me a marketing lesson I will never forget.

Jarring questions

“No, no, no, Dave. Let me tell you, all that stuff sounds good, but that’s not going to sell your product. You’ve got to answer three questions for customers if you want to be successful: What problem are you solving? What’s your solution? And most important, why you?”

That was jarring, and for a minute I felt a deep resentment of the large Jewish man who was pontificating in my small office space. However, as we continued to talk, I began to understand. It wasn’t that the great technical features of our product weren’t important or meaningful; Fred’s point was that we had to communicate the value our product would provide to customers. Moreover, he was saying that even after we convinced the customer that we could solve their problem, we still had to answer the “why you?” question. In other words, why should the prospective customer purchase the solution from us instead of looking somewhere else? This was an especially important point, as I and my co-founders were three young black engineers who were attempting to sell a highly sophisticated, very expensive product to customers who were mostly conservative white engineers. Why us, indeed.

Fred's lesson stuck - and it worked.

Given the revelation from Fred, I and my co-founders focused on answering his three core questions, and armed with the answers we provided, Fred produced some top-notch marketing materials that helped us land some of our first big sales. More important, the experience with Fred taught me that I couldn’t rely on impressive specs or good will or sympathy to sell our products. I had to convince potential customers that they would be better off for doing business with us. That realization permeated our company and fueled our success, and it is a lesson that I share with aspiring entrepreneurs and students to this day. Today we speak of problem/solution fit, of value propositions and customer segments, and business models, but at the heart of all that is the simple lesson I learned from Fred Rosenthal nearly 40 years ago.

Fred named his company after his wife, Carol. They were married for 69 years until separated by Fred’s death. I remember being impressed that, despite his size, Fred was an avid sailor. He also gave significant portions of his talent and experience to charitable causes, some of which I only learned of by reading his obituary.

Rest in peace, Fred. And thank you.