Lessons Learned

• The Good:

  • Big ideas: Kudos go to Lee for a) thinking out of the box and b) thinking big. He recognized that a Trump strategy would include selling a large number of sandwiches in a big sale. Though his attempt ultimately failed, he is to be credited for smart sales strategy and initiative.

  • Grease the marketing wheels: Sean had an excellent idea to market the promotion the night before by handing out fliers. Though he knew not everyone would respond, he was targeting the 10 percent who might. Sales are a numbers game -- increasing awareness of your product is always a good strategy. In this case, it paid off with many customers returning with the flier in hand.
     

• The Bad:

  • Understanding price elasticity is critical: Leslie priced herself out of her market. How many typical 7-Eleven customers are willing to shell out $8 for a sandwich? Understanding price sensitivity and being willing to adjust it appropriately is basic Business 101. In a one-day task, pricing is a critical item that you do in the morning that can easily destroy you before lunch. Leslie also didn't listen to Lee when he suggested she lower the price -- even after he shared that he overheard the store managers laughing at the high price. When you have smart people on your team, listen to them.

    Trump's ability to negotiate price is legendary -- it was no surprise that he fired Leslie for her failure to do so.
     

• The Ugly:  Once again, this loss was all about the price point. Gold Rush chose a good promotional item that went along with the sale of the sandwich. But it was obvious that Leslie needed to trust Lee on the pricing; particularly after he did the research on the average price of sandwiches: $4 is a lot lower than the $7.99 Leslie chose to charge. Leslie should also have given Lee credit for taking a risk with that deal he was trying to close on 1,000 sandwiches! Entrepreneurs take risks, and you win some and you lose some. Leslie should have gone with his thinking on this in wanting to go for the big win.
   

• Price convenience products accordingly: In the 7-Eleven task, Leslie stubbornly set the price for the new sandwich at $7.99, even though the store manager suggested a lower price. Even worse, when it became obvious that the sandwich was overpriced, even for New York City, she refused to lower the price to build volume.
  
  The bottom line: A sandwich at 7-Eleven is what marketers would label a "convenience" product - frequently consumed, widely available, and above all, relatively low in price. It's hard to justify selling a sandwich at a 7-Eleven for $7.99, especially when one is trying to build volume. Interestingly, even though Gold Rush was giving away mini-coolers - seemingly a more appropriate giveaway for a sandwich promotion than Synergy's hats - Gold Rush still lost by a wide margin. This fact supports the notion that sales of the product were driven mainly by the price point.

Rankings

We have reached the halfway point in this season of "The Apprentice." As in previous seasons, the "endangered species list" is now replaced by a rank-ordering of the remaining candidates, based on the likelihood that they will eventually be hired by Trump.

1. Sean (Synergy): He's smart, has one victory as a project manager, is well-liked by his team and looks as if he just stepped out of a fashion magazine. The winning "Apprentice" candidates spend a lot of time doing PR for the Trump brand, and Sean certainly seems qualified for that role.

2. Lee (Gold Rush): He's very similar to Andy, a whiz-kid from season 2 of the show, whom Trump eventually hired "on the side" after the season ended. Lee is Ivy-League educated, is a fountain of ideas and is a deal-maker/risk taker. He also has one victory as a project manager.

3. Andrea (Synergy): She's the first candidate to earn two victories as a project manager, but she has a very hard edge that can rub people the wrong way.

4. Michael (Gold Rush): Even though his previous team, Synergy, gave him no credit for his role as winning project manager in week 7, he really made a couple of key contributions at the beginning and at the end of the task. In the middle, he wasn't that effective as an operational manager.

5. Allie (Synergy): She was the winning project manager in week 1, but we haven't heard much from her since then.

6. Roxanne (Synergy): She has one victory as a project manager, but it was tainted by a fairly pathetic pity party that she laid on the rest of her team, during which she claimed that like the late Rodney Dangerfield, she was a victim of "no respect."

7. Charmaine (Gold Rush): She has one victory as a project manager, which was the high point for her this season. She has also been part of some colossal failures and is fortunate to still be in the competition.

8. Tammy (Synergy): She has a substantial marketing background, but lost as a project manager on a task that was mainly about marketing. She has been fairly low-key since then.

9. Tarek (Gold Rush): Things have gone downhill for him since he bragged about being a Mensa member in week 1. He lost in his first stint as a project manager and has been a frequent attendee at boardroom firing sessions.

Commentary

With Lenny gone there is suddenly a more serious tone now. Michael definitely made the right move in going over to team Gold Rush. After the conversation back in the suite, he knew he didn't have the support of his team and he knew to get out of there. Very good decision Michael.