Inc. magazine has a story on why Sharper Iamge went bankrupt and why brick-and-mortar stores are in for a rude 2008. Obviously, gas and food price increases are hurting consumers. In addition, mortage, taxes, and insurance rate hikes have taken a bite out of disposable income. The money belt is tightening.

On the business side of things, as Starbucks just realized, chains opened too many stores. It’s tough to staff and increase same store sales, but Wall Street wanted growth. (One more reason to go private). Other reasons are that exclusive deals and product innovation are harder to come by. The surprise for me was this:

“What happened at Sharper Image? One of the biggest challenges that Sharper Image faced in the past five years was that the Apple store took over as the place to hang out and play with gadgets in the mall. We were lulled into a period of complacency because of the success of the Ionic Breeze.”

What can you take away from this? Well, innovate for one. Watch the marketplace / economy / industry / trends. Don’t get complacent. As Tom Peters says: “Re-Invent or Die”.

Uniqueness is what Differentiates you in the marketplace. It is also known as Positioning.

Brains on Fire blogged about the differences between the Number 1 and Number 2 men’s tennis players and what that means about brand identity:

“I just think it’s another real world reminder that brand identities can’t necessarily just be built around the “USP” idea. You have to know what that big thing is that defines you above all else - whether you think of it in terms of your USP or your mission or whatever - but it’s the tiny inroads and specific human touches that make you unique, and that people key into when identifying with you.

Do you know what that Big One Thing is that sets you apart from your competitors?

In an article in Fast Company (Nov., 2007 issue), the Heath brothers (authors of the 2007 business book must-read, Made to Stick) write an article titled, Analysis of Paralysis. In tidbits, they explain that too much choice can mean that the consumer will choose None of the Above. The other point is about a company’s vision. It needs to be simple, concise, short, memorable - “make technology easy” or “build the best plane in the world”. Eliminates the doubt.

We once talked to leaders of one of the nation’s top mental-health facilities, which was in the process of revamping its mission and goals. We were surprised to find that it had 11 core values. They were admirable–innovation, integrity, and so on. But values are supposed to guide behavior, and you can’t even remember 11 values, much less use them to make decisions. Stephen Hawking can think in 11-dimensional space, but you can’t. Practically speaking, having 11 values is equivalent to having no values. [fastcompany]