Michael Jackson leaves hefty debts, unrealized comeback

Along with a vast musical legacy and legions of adoring fans, pop superstar Michael Jackson leaves behind a mountain of debt and an unfulfilled comeback many hoped would rake in millions and erase his financial troubles.

The King of Pop died suddenly on Thursday at the age of 50, after a career spanning 40 years that included the biggest-selling pop album of all time, "Thriller."

Despite taking in hundreds of millions of dollars as one of the most successful pop musicians of all time, Jackson racked up about $500 million of debt, according to sources cited by The Wall Street Journal earlier this month.

His top assets, however, including copyrights to his own songs and a stake in the Beatles' song catalog, are worth more than $1 billion, according to a music industry source.

Jackson's career and image were tarnished by his mounting financial and legal troubles in recent years.

Known for huge shopping sprees for toys and antiques, Jackson was accused by an accountant during his 2005 trial on child molestation charges of spending $20 million to $30 million more than he was bringing in per year.

The lavish lifestyle was made possible in part by a $200 million loan secured by his stake in the Beatles catalog. Jackson owned the music in a joint venture with Sony Corp known as Sony/ATV. Jackson refinanced those loans in 2006 in a bid to stave off insolvency.

In addition, Jackson last November had to hand over the title on his Neverland estate in California to a company made up of himself and Los Angeles-based real estate investment trust Colony Capital LLC, the firm that holds his $23 million loan on the property.

Colony Capital has been sprucing up the ranch and planned to sell it, according to the Journal. Colony Chief Executive Tom Barrack told the newspaper last month the estate could fetch $70 million to $80 million, or more if Jackson's career were revitalized.

In a statement on Thursday, Barrack said he was "deeply saddened" by Jackson's death, but did not comment on the impact on Colony's business.

PLANNED BIG COMEBACK

To help turn around his financial fortunes, Jackson was planning a major comeback in London this summer, 12 years since his last tour.

AEG Live, which was promoting the 50-concert run at the 02 Arena, stands to lose as much as $40 million if its insurance is not substantial enough to cover what it has already spent on the production, Billboard reported, and one attorney said the company would not be able to recover any of those costs from Jackson's estate.

"The concert promoters can't sue the estate," said Bob Rasmussen, dean of the Gould Law School at the University of Southern California. "Once he dies, he doesn't have any obligation to perform."

AEG, wholly owned by privately held Anschutz Co, will also certainly miss out on the $400 million the company estimated it could raise through a 3 1/2-year plan to work with Jackson.But Jackson's greatest financial returns may come in the wake of his death. His long-term record company, Sony Music Entertainment, will likely reissue special versions of some his biggest-selling albums and possibly even rare recordings.

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Change your thinking

What it comes down to, is action. I'm not talking about 'snapping out of it'. I'm saying if you're feeling stuck in a rut, bored, stale, lacking in self belief or you've just run out of ideas, why not try doing just one little thing differently?

So often it's our thinking that gets us into a rut. Small business owners are particularly at risk of this because we tend to rely heavily on our inner resources. But when it's our thinking that gets us into that rut, how much sense does it make to try to think our way out of it?

I'm thinking, not much.

Meanwhile, the very act of deciding to do something rather than keep thinking about how to make a shift is itself doing something different. There's your first little step right there.

You may have heard the expression 'Act as...'. This is a technique for tackling unhelpful thinking or beliefs about ourselves. If one of your inner voices dishes out thoughts like, "I am not creative" for example, or put-downs that amount to the same thing, you need a strategy to restore your sanity.

You can counter that voice by imagining what things might be like if you were creative. What would such a person - yes you - be doing? What behaviours would provide evidence that you were indeed creative? What kind of beliefs would you have about yourself? What sort of inner dialogue would be going on in the mind of a totally creative you?

The invitation you can issue to yourself, is to act 'as if' you were creative; that is, to step into this picture of your very creative self, be it and do it and see what flows. Taking the action first can actually change the way we think, feel and experience ideas about many things. Creativity is just an example.

When we start taking different actions, despite feeling uncomfortable and anxious, it becomes a whole lot easier to rewrite the script for those inner voices. What's more, when we're actually walking that new talk, we're giving ourselves every reason to believe we are in fact creative, capable, courageous, compassionate, confident or whatever belief we'd like to have about ourselves. (Note: it also works for qualities that begin with letters other than "c").

Remember, you can begin with the tiniest change imaginable. To start with, shift your gaze 10 degrees, not 90. And watch yourself become more of the thing that crazy voice says you're not.
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The importance of customer loyalty

Loyalty leaders are successful because they have designed their entire business systems around customer loyalty. Building a highly loyal customer base must be integral to your basic business strategy.

Customer loyalty can be defined as the strength of the relationship between an individual's relative attitude and repeat patronage with a supplier.

It is a self-reinforcing system in which the company delivers superior value consistently to find and keep high-quality customers, (and, where applicable, employees).

The economic benefits of high customer loyalty are measurable. When you consistently deliver superior value and win customer loyalty, market share, revenues and profitability all go up, and the cost of acquiring new customers goes down.

A clear and structured new customer induction scheme will boost customer loyalty and retention, increase the frequency of purchase and raise the dollar value of each transaction and increase referrals.

Customer induction schemes are a vital step in business growth as they deliver higher yielding customers and drive up profits by reducing the need to spend money attracting new customers.

It is very much about long term retention marketing and is purely created through exemplary customer service. Creating an induction scheme does not replace the imperative of delivering excellent customer service at each and every transaction, it merely supports it.

I’ve said it before and it’s well worth repeating, “People do business with people they trust”. Furthermore, people do business with people who are knowledgeable, efficient and will deliver what they promise.

Nothing is harder to regain than lost trust.

We are at a time when gaining a customers' trust is critical. Building trust is a daily process, conducted on purpose. Now more than ever, we need to focus on behaving ethically and resolving problems with customers.

Only 2 percent of customers complain and credible research suggests a complaint, when resolved well and in a timely fashion, converts into a loyal customer. So welcome them if and when you get them.

Opportunity will not be greatest for those companies with the most technological bells and whistles; it will go to those companies that develop and nurture a service culture.

For more from Jack Fraenkel, head to www.flyingsolo.com.au, Australia's online community for solo business owners.
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Business commitments: Is your word your bond? Also in this section

‘Gumps’, the oldest member of my family, is a 91 year old country stockman. Back in the day, he did big deals on nothing more than a handshake.

But it seems business commitments and promises are getting increasingly casual. Is your word your bond?

Gumps was telling me that a couple of water bills that showed usage a little on the high side, prompted him to drop by his local water authority. It wasn’t the cost he was concerned about, but the wastage.

He was greeted by a ‘young fella’ who assured him the water used was within the normal range for a couple. Gumps, who has two huge rainwater tanks and is quick in the shower, insisted that they didn’t use that much.

Eventually he was told “Let me look into it for you and let you know if I find anything.” Gumps headed off unsatisfied, expecting to hear nothing more of it.

Millions of casual promises are made in business and life every day:

* “I’ll give you a call tomorrow.”
* “I’ll be there at 3pm.”
* “It’ll only take 5 minutes.”
* “I’ll send you a quote first thing.”
* “I’ll make a decision next week.”
* “Your call is important to us.”

Mostly the intentions of the business commitments are genuine, but often they are meaningless utterances said out of habit. The problem is that they erode people’s trust in your ‘real’ promises and reliability.

I like to finish business conversations with a commitment to action or ‘next step’. I know, however, that I need to keep the business commitment or not make it at all.

The good news is because people are used to being let down in a world of casual promises, it’s easy to set yourself apart just by doing what you say you’ll do.

That’s why when Gumps received a letter and cheque in the mail a few weeks later he was so astonished that he’s been raving about the great service ever since.

Why? All because the young lad had simply “looked into it and got back to him” as promised. And it was their error in the first place!

This level of service should come as standard, but it’s rare.

It’s the same old but true chestnut; under-promise, over-deliver. Or as Elvis would say “A little less conversation, a little more action.”

For more from Peter Crocker, head to www.flyingsolo.com.au, Australia's online community for solo business owners.
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