Where's the Old Spice of Women's Marketing

My friend Colin Gorman, marketing genius at BBH, made a subtle but important insight to me over email. When you look at the most recent commercial viral campaigns they are dominated by mens brands.

Of course the talk of the day is about the Old Spice guy. Funny, silly commercial. But they also targeted the most active and linked users in their network and directly responded to them. In videos with the star. They produced 70+ videos in 2 days addressing individuals, including Alyssa Milano who had dared the Old Spice man to donate money to Gulf Disaster relief. It's so popular, a VC actually got into a towel to pitch to a room of entrepreneurs. This is a pic of the video address to the entrepreneurs:

The whole Old Spice campaign is cheeky, biting, a little bit random with a hint of surprise.

Another one I really loved was the Day and Night video from Axe body spray. They call it their Anthem. It's a really fun video that captures a day in the life of a college-aged party maniac. It really captured a lifestyle that the movie Go attempted and just missed. It's hilarious. And it's cheeky, fun, and a bit random with a lot of surprise.

I could keep going down the list with other companies like TAG, but the point is more that these campaigns are very much targeted at a male audience, and that in targeting the male audience, they seem to have found a recipe that's also viral. I wonder if there are equivalents in the female category. I don't see them, but that may be because I am not in the target demographic (although I'll bet many women know about the Old Spice and Axe campaigns). The kitten meme doesn't count.

I know there was the Dove Campaign for Real Beauty. But that was much more serious and clung to an issue rather than a lifestyle. Is there something out there I am missing?

If not, I think there is an opportunity to target the college age and early woman audience with something that's cheeky, fun and surprising. There are women who go out, club, dance, get drunk, party etc. but we almost never see that scene as a marketing ploy. Where is the "Girls Night Out" video that captures the lifestyle of this demographic? We've all seen those parties in motion, we have heard the screams, seen the ploys, played the games and even held some hair. Now admittedly, living in NYC I may be a little biased. It didn't seem like there are many opportunities in Davenport, Iowa so maybe the national appeal of the market segment is less than I perceive it to be. Then again, this is a pic of my girlfriend at a party from Iowa State.

I know. I am so proud!

So who's going to be the brand that breaks away from the traditional female marketers. I think this is a large niche that has yet to be filled. Or maybe, I am just terribly uninformed. What do you think?

BTW, it was Colin's birthday this weekend. Happy birthday!

A Quick Response to Some Dumb Analysis on Apple

Ok, I admit it. No I proclaim it. I love Apple products. Tell me you enjoy putting in a calendar entry. I do on my iPhone. And I love my Mac OS and yes I hate using your PC. But that's not to say that Apple is above reproach. The search warrant and seizing of property was more than a bit much. It was a douche move. Apple is leveraging it's dominance in the ecosystem to eek out considerable revenues. It's pushing out 3rd parties from intermediating themselves (Flash dev tools as an example), although I generally agree with controlling the quality of your distribution channel. It's a monopolistic threat and I worry that they may push too far. But so far, the products are great, and one of the key reasons is control. I think early markets should be controlled before they are opened up. Starting off as the wild, wild west can be problematic. But I digress.

My friend, Janet, sent me this article because I am an Apple enthusiast. She thought of me.

http://blogs.bnet.com/salesmachine/?p=10031


Top 10 Apple marketing mistakes, but man this guy is way off. Apple surely made mistakes. Pricing low in an emerging market in early PC days was one. But it is also why even though Apple has well under 10% market share, it has 80% margin share. Hard to argue on that one. But overall, his biggest analytical mistakes are in this writer's top 5.

#5 Sleeping With Microsoft - This guy is dead wrong. I would not have a mac if I could not run Word and Excel. Period. A laptop needs to meet a generalist purpose. A lot of startups I know run on Apple. None would without Office. Google Apps is only beginning to provide an alternative.

#4 Treating Journalists Like Cockroaches - Dead wrong again. Yes there is some journalist bitching, mostly from the recent search warrant. Before that, it was journalists bitching, but not in the consumer eye which matters. Overall, Apple has a mystery that makes it much more interesting and widely talked about than competitors. Did you know Microsoft is about to release a new mobile phone? Nope. Because no one cares. Apple's new iPhone in June? Bet you know the whole story. Mystery, exclusivity add to the brand value. I'm not supporting the search warrant, that was a douche move. But secrecy breeds intrigue. Even journalists who get the good scoop. Just ask Gizmodo.

#3 Pretending Their the Underdog - Man this guy is getting dumber with each of these. Mac's share in the PC market is under 10%. Ummm ... that's underdog in the PC business. Comparing it's overall valuation that's based on iPod and iPhone business is stupid. It's like saying Microsoft is pissed because it's marketing itself as #20 keyboard manufacturer even though it has a multi-billion dollar market cap. Different business. Apple has to challenge the "Why status quo?" Check out the market share trend since these commercials launched. Check out the improvement in brand identity. Check out customer loyalty. I'm Apple. I'm different than the mainstream people who just take what they're given.

#2 Censoring the iPhone - What you don't get is that there is a value at controlling the quality and identity of your marketplace. If iPhones and iPads are kid friendly, which device is going to be a kid's first device (hint: they will use the parent's credit card). Gaming and education will be huge on these platforms. The porn stand limits short term revenue in favor of long term penetration. Yes, I said penetration when referring to porn.

#1 AT&T Exclusivity Agreement - Ok. That's it. This guy just reached my idiot of the week status. Apple just turned the entire mobile industry eco-system upside down. Walled gardens. Control of deck. Using the mobile carrier infrastructure. If Apple didn't grant exclusivity, they would have no grounds to make demands. Their amazing product is the sole reason for AT&T's increase in market share (look at the stats). They used their superior product to negotiate a superior business model that now every carrier has to adopt to play with the most popular consumer device. They couldn't have done this without exclusivity. What's that? A billion apps sold? An iPad platform for next generation tablets where they control media and software distribution? Treating the carriers like a pipe. Apple got everything for a couple years of exclusivity. In one market.

There are many reasons to be wary of Apple flexing it's muscles and stifling innovation. Right now though, they are the most innovative company in mobile.

Is Bravo an Ad Network on FourSquare?

I just began to understand the value of FourSquare's strategy to partner with content providers. I thought I understood partners like Zagat recommending better restaurants or to dos, but I recently checked in to Merc bar and was told by Bravo to go to Paul Smith. By choosing to "follow" them to get a badge, I essentially opted in to them pushing me content.

If you think about this closely, this is essentially a proactive magazine, pushing me content when it's most easily actionable i.e. when I'm nearby. Of course the content itself is a form of advertising. Go here, buy this.

So another way to think about this is me opting-in to local ad networks, based on brand affinity (ex. Bravo, Zagat, WSJ, etc.).

I opted-in because I wanted a badge and I wanted to experiment, but over the long term this strategy can only be successful if I care about the badge that much (limited once you get the badge), if the content provider negotiates better deals (couponing as advertising) or the info is insightful and wanted (content as advertising).

As banner ads continue to die as we get better at ignoring them (just like tv commercials) advertising will continue to be integrated into service and content (just like TV). FourSquare's content strategy is an interesting development that allows them to plug in content providers or in other words ad networks. They need to be smart about controlling the marketplace, but it's a brilliant idea.

Facebook Could Become the iTunes of the Internet

Note: I recognize that iTunes really is an Internet application already, so saying Facebook Could Become the iTunes of the Internet is like saying Justin Timberlake Could Become the White Michael Jackson. But alas …

I continue to be bullish about Apple in general. They make the best computers. The best media players. And they have the best media distribution platform – and if you follow Fred Wilson, you know that software is media too. Take a look at the AppStore. The success of iTunes when everything else failed miserably was based on a couple key factors:

1) Apple had the best media player and leveraged it – It’s amazing what a simple track wheel can do. Basic file interface and playlisting, easy to navigate. Drop dead simple. That’s what it took to win a billion dollar industry. A trackwheel.

2) iTunes was simple and just worked – I got my first MP3 player from my roommate Al. Getting songs on and off of it was a chore. The interface was flashy and choppy at points. Features were hard to use. iTunes you could just install and go. And provided the music you needed.

3) Micropayments were made easy – I think it’s kind of silly that Amazon “patented” one click check out, because Apple is even better at it. You put your credit card in once, and then any time you make a purchase, all you need to is put in a password. Easy. People will buy at $0.99 a song if it takes less than 15 seconds but won’t buy at $0.49 a song if it takes 1-2 minutes. They optimized on the right dimension – time. And because they roll up all transactions minimizing the fixed costs of credit card processing, they optimize on cost as well.

4) Apple worked with the media companies at desperate times – Yes Apple implemented DRM when no one else would, and that was more of a perceived chore than an actual one for the consumer. But in the end, that was what kept Apple in the game. And by leveraging the desperation of the moment (and their iPod install base), Apple struck a good deal with the media companies. A minor inconvenience for the power of consolidation.

Now the iTunes model to micropayments can apply to all kinds of digital media including news, magazines, stock research, blogs and almost anything. So now let’s shift gears to Facebook, which is in a tremendous position to become the iTunes of the Internet. The parallels are interesting:

1) Facebook is the Biggest Internet Application and Social Network – Already being there for now 500 million people is a HUGE advantage. No one else can really compete there. By integrating payments into Facebook apps like Farmville (60M players) they can overnight build an eWallet install base. With a little creativity, you could increase penetration well beyond that.

2) Facebook is Simple and Works – Facebook’s differentiation from MySpace was that it was simple, not cluttered and that the activity feed brought you what you really wanted – what your friends were up to. It was surprisingly useful and provided what you wanted before you realized how much you needed it. Now 250 million people check it every day.

3) Micropayments Made Easy – I haven’t seen Facebook’s payment interface, but it will be simple. They have a growing history of embedding their technologies into outside web sites. And their applications have experimented with credits already, so they have lots of sample implementations to reference. Plus, with tons of payment applications for person-to-person gifting and gift cards, group payments and social gaming, weaving in payments to the social fabric makes sense. But the success depends on the chances of a collision: that the person you are interacting with is on the same network. Facebook is the natural choice.

4) Facebook Will Work with the Leading Media Companies in Desperate Times – Ok, so this hasn’t exactly happened yet but all the pieces are in place. Media companies like NY Times, Meredith, Hearst and more are scrambling. They continue losing money, audience and differentiation – just like the Record Labels were. They are trying to create subscription based services and micropayment access, but they are unlikely to succeed. If they could plug in a simpler payment service with one click payments, they sure will have a hell of better time of it. They may lose the 5-10% margin in payment processing, but they will probably get 50+% increased conversion.

Now there is one thing I didn’t mention in the analysis that could be the X factor of success. Apple has much better brand standing than Facebook. Facebook’s Beacon program was an unfortunate misstep from which they will not easily recover. Customer trust is built over a lifetime and lost in an instant.

So Facebook needs to tread lightly. Start by integrating payments into its applications like Farmville. Partner or create some basic apps that further increase penetration (event payments, gifting, etc.). Then offer a payment API like Google Checkout to a few big media companies and then you are off to the races.

It wouldn’t take that long, but it would transform the Internet. Micropayments everywhere … Facebook is the iTunes of the Internet.

Now of course no one is going to just give up the largest payment processing opportunity on the planet. PayPal is no slouch at 30M monthly uniques. Amazon Checkout has had limited penetration beyond it’s walls, but there are a few noteworthy customers like Meetup. Google Checkout is a good small vendor solution, but has had little penetration among the big boys. And with the media hating Google right now, they seem unlikely bedfellows. Then of course there is Apple, with iTunes owning paid media distribution right now. If the iPad sells 5M units this year, that’s significant traction. But hardware purchase is a big obstacle to customer adoption. So advantage Facebook.

It’s all very early … but that makes it all very exciting too.

2010 - The Year of Magical iPad Thinking

So this week I sold some Apple stock, but I think that may have been a mistake. I am so bullish on the much maligned iPad. Here’s why. I was at an entrepreneur round table reviewing an educational book company that was all electronic. You could replace the names of the characters and it would read or let you read the story to your kids. You could touch words and it would pronounce them for you. Not a very hard app, but great for kids.

How would you deliver that experience? On a kindle? Nope. Black and white is boring. On a LeapFrog, too hard to read and interact. The iPad is your best bet. Now if they added more interaction like choose your own adventure that would be even cooler (as I pointed out). Imagine a world you can explore, full of stories, interactive characters all in a learning environment. Would you really put it on a netbook? Probably not. Where are developers flocking? The iPad. Where will you have a rich library of these apps? The iPad.

Think of where else you would want an iPad in an educational environment. A while ago I wrote about FoldIt models.

Here is the YouTube embed:

On an iPad, this is a much cooler interface to understand organic chemistry. Anatomy: imagine exploring a 3D model of the body with your hands vs. a text book. iPad. Physics: demonstrations where you can change the variables and create interactive problem sets. Geometry: exploring shapes, symmetries, angular relationships. What about music and composing? The iPad already has some wicked DJ apps. Now let’s focus on music learning. Drawing and sketching?

But beyond that, let’s look at some of the more traditional, not so visual subject. I always hated history. Sure the stories were good, and I was ok at memorizing dates. But I was never good at synthesizing the whole thing together. Was the assassination of Archduke Fedinand a response to Russian involvement or did it trigger it? Imagine exploring history like a mind map with timeline interaction. See the events, drill down, see what’s next. Zoom out. See a related timeline of English involvement. What was happening in America at the time. When you can quickly navigate data with your hands, you create whole new ways to organize, present and interact with data of all kinds.

The iPad is magical – yes I said magical. Multi-touch interaction, a rich and large screen and a small footprint is revolutionary. Yes, it’s a big iPod Touch. But it’s the best platform by far for so many interesting apps. At the very least, it will be the leading portable gaming device within a year, which is a huge market in and of itself. The excitement given the wealth of possibilities is deserved. No one else in the market can pull this off. That's market leadership.

I think I may go back in. AAPL it up people!

Facebook Is the New Internet

First off, I am borrowing a little from Mark Cuban on this, but I have been thinking about Facebook's latest moves and his article sparked my writing. It's an interesting time right now for Facebook as they release new functionality to extend its reach into every web page and service. Soon, everything we do on the net can be easily shared, incorporated into Facebook. Imagine a world where the NYTimes reports which articles your friends are reading and let's you easily spark discussions on the topic, just for you. Music playlists that are easily shared and commented on? What Facebook is doing is adding social connectivity to all our online activity, which is becoming most of our activity. And in doing so, it is plugging into our core existential social needs. Technology, which often is seen as taking us away from a social context, will now be bringing us back in and creating more meaning. And no one else can remotely achieve this. Facebook is the platform (which is also why I disagree with Mark Cuban on Facebook needing a mobile OS, they can just deeply integrate into the contact list because that's who owns our social connectivity. You can't launch a product without that).

And if Facebook defines our social connectivity, who are friends are to us, it inversely defines who we are to our friends. Why should I only be tagged on Facebook in photos or notes? What if this blog is tagged (besides me posting it to my activity feed) or a research article I write or a mention of me in huge story in the NY Times (see you this summer)? Check out Taggable, which does exactly that. Now the whole electronic universe can be captured on my Facebook profile and the work crowdsourced by friends. One day, it might be automated based on context and matching algorithms (this Trevor Sumner instead of this one).

Facebook encompasses so much. It's how we find out what's going on, what our friends are reading and recommending. As Mark Cuban points out, how often do you use Google anymore to find reading material ... If every service becomes social, is there a difference between the social web and the web itself?

Next up: Facebook is the new App Store.

Loyalty and the Emotional Side of Customer Retention

I just finished SmartMobs (a recommended read) and came across a wonderful little anecdote. In Tokyo, one of the busiest intersections is Shibuya Crossing, where there is a bronze monument to a dog named Hachiko. Hachiko followed his owner, Professor Eisaboru Ueno, every day to the subway station and awaited there again that evening for his return. Professor Eisaboru died in 1925 and never made it back, yet Hachiko faithfully waited for him there every evening until 1934. Nine years, or sixty-three in dog years. It’s a touching story about loyalty.

And while the story pulls on my emotional heartstrings, it also leaves me in wonder. What made Hachiko come back every day for so long, hoping for a different result than the previous day? Is that just foolish? What made Hachiko so loyal in the first place?

On the web, I would argue that few things are more valuable than loyalty. With the breadth of services offered out there, you can buy books from someone else than Amazon, shoes from somewhere else than Zappos, movies from other services than Netflix. Often, it makes sense.

But the services that matter bring users back consistently and often without competitive consideration because of brand loyalty. And that’s what builds lasting value. It’s easy to buy traffic, just a click of the mouse. It’s really hard to build a service that people care about. If I were valuing a web company, the first thing I would ask for is repeat visits (visits per user per month, member retention/attrition, etc.).

So what builds lasting loyalty? There is utility and feel, the intellectual and emotional.

Apple has it through products that feel better. I don’t know if the roll wheel calendar on my iPhone is more efficient, but it’s more of a pleasure to use. I don’t think that the magnetic power cord in my Powerbook actually functions much better than a plug in, but the moment I connected them and the power chord literally jumped into the socket, I knew I was an Apple user for life.

FourSquare is another app that feels good. Its point system gives me that Pavlovian feedback, that slight burst of serotonin that makes me keep checking in. Intellectually I know it provides me no value. At the same time, I checked out Lewis Goldberg’s badge page and was actually kind of sad he had more than me. What do I really care about badges?

Now Apple provides me real utility. I am writing this on my Macbook Pro right now. FourSquare’s utility not so much, and I feel its hold waning on me. The gaming aspects have grown a bit old. I want more badges. New things unlocked. Feel can get stale. But if you mix positive feel with utility, maybe not even differentiated utility, then you get long-lasting loyalty. With every thing I do that’s helpful, I see it, more I feel it as a little bit more. A reinforcement of that initial joy, that satisfaction of a good product and of making a good choice. And that momentum gets a customer coming back for life.

Will I be using Apple products in 9 years? Who knows? But my stock portfolio is making a big bet for now that I will be.

Unique Problems With Uniques

Uniques are what make the world go around, at least the Internet world. Advertisers care about their reach, the numbers of unique users they get in front of on a campaign. 1 million is the magic number and all of a sudden getting advertisers becomes much, much easier.

Uniques are so important that marketers like me spend money generating cheap traffic to inflate uniques even at a loss. It's a sizable percentage of traffic if you do it right, enough to inflate the numbers without killing your click through rates and bounce rate (the rate people leave the website after the first page view).

It's all about uniques. How are you compared to your competition? Check the uniques on compete.com. How's the board think you are doing? Just show progress on uniques. But as someone who looks at web metrics and models businesses, unique growth and future prospects of most business have much more to do with member retention (churn, repeat usage), viral coefficients and cost of customer acquisition and value. With positive key performance indicators (KPI) along these lines and you know you have a business that has long term value.

Sometimes that means you make prioritization decisions in development to things that drive uniques even at the cost of longer term value. The reality is that for $500, I can drive 50,000 visitors. $5,000 then 500,000. Not much money to get you halfway to that 1 million unique magic number.

But a new report and analysis say that the whole industry could be overestimating our unique count by a factor of 2 or 3. That's just crazy. If that were accurate it could send shockwaves throughout the industry. Or not.

If the number changes, does it change the performance of existing campaigns? We can still measure ROI. It won't change tomorrow. It just means we are twice as effective at marketing to half the number of people we thought. Or will the new numbers scare off holistic marketers who compare the reach of traditional campaigns? If this plays out, it could be a very interesting year.

Facebook Takes Over My iPhone

Not surprisingly, Facebook has taken over my iPhone. Not the apps, but the phone itself, and it's about time. Facebook is where we are social. It's where our friends are. It's a contact list that updates itself. It fills out profile information with substantive info. So as the dynamic system of record of my social contacts, why hasn't it merged with my traditional contact list before?

Well, not all my contacts are on Facebook, so the approach they took is simple, just Facebook enhance the contacts they recognize. Now Facebook is in my iPhone contact list and can add all that data when I pull up their contact info. I now know not to suggest steak for dinner because I see from your status you had a ribeye at lunch. Combine that with FourSquare data and I might know roughly where you are. Give me Google Lattitude Access and I will know exactly where you are.

The point is that there are so many services that provide info about your friends and what they have done. Facebook is the defacto standard. By extending their reach into my contact list, they strengthen that position and make it easier for all of the smaller apps to get to the contact list, just integrate into Facebook you see.

It's a major move that hasn't received enough attention in my humble opinion. Now of course, Facebook is abusing this permission and sending me a constant stream of notifications that I am going to turn off. But they just staked out some significant territory and I am better for it (barring some serious privacy concerns, of course).

Obama Needs Your Help

So my last post was pretty funny, mostly for the ads that popped up.

Obama needs my help. Donate now to get healthcare reform passed.

Obama, here's a little hint. I donate twice a month to help you get helpful policies passed. It's in my paycheck and it's over 30% of everything I make. I hope that's friggin enough!

And this is the core problem. My vote no longer determines what policies are going to be passed because of the people I elect. Instead, my vote decides who will later collect my money when I "vote" for which policies I care about by sending in more money.

Democracy and capitalism are naturally at odds. Democracy is one man, one vote where in capitalism, money is power. Now we have this weird hybrid and we're voting for who gets the money that determines policy. It's all just a sham then that comes down to money.

Strange, sad and makes you apathetic, especially when even the supreme court isn't there to protect democracy. Who's left?

The Role of Government in a Short Term Nation

I thought Obama's State of the Union was decent. He's a good orator. It's nice to know the economy is back on the table since the stock market tanked (as I predicted) and joblessness keeps getting worse. But to a certain extent, I think we all went into it wanting to be inspired but in acceptance that even inspirational words would fall flat on apathetic ears. It's hard to watch these children that we call Congressman and Senators battle for turf like it's a late night game of Settlers of Catan. Seems like there is more at stake. Yes people are dying. Yes people are losing their homes. Yes people are losing their jobs. And that's just healthcare.

The Republican talking points after the speech were somewhat predictable, running off the familiar playbook. But it seemed Obama's preemptive attempts to mitigate their attack script on deficit spending, taxes and the like dampened the blow. Gov. McDonnel kept talking about the role of government with his smug grin.

Now as a libertarian, I generally agree. Get the hell out of my life. But the world has gotten so big and so complex, there are literally millions of ways you are being screwed right now. I was talking with CJ Kettler this afternoon, who serves on a board of a charity aimed at protecting children from harmful chemicals. She is about to petition for reform of an organization that formed in 1970 to ban hazardous substances in New York. In 30 years, they have banned 4 of them. Must be a nice job to have. I can name 4 substances that should be banned right now - diet coke, twinkies, Polly-O string cheese and fat free chocolate. Not that fat free chocolate is bad for you, but come on now!

I tend to like Bill Maher, and I remember on one of his shows he went off on a rant (paraphrasing):

"Why can't we be honest with ourselves in this country? We look around and see increased rates of disease and try to point the finger at a cause, but we all know the truth. America causes cancer. We pollute our air. We pollute our waters. We inject our livestock with hormones, drugs and genetically engineer our crops to withstand shipping and be nutrient-less. We eat and drink chemically engineered products like high fructose corn syrup. And then we are so naive as to say, 'I wonder why we have higher cancer rates than Chernobyl.'"

I agree. It's like what my roommate Brett said last week. "I can't drink diet soda. It tastes like cancer and makes my teeth tingle until I shiver." Ok, the shivering is a bit much, but from the moment I taste diet soda, I knew it was very wrong.

You can agree or disagree with aspartame if you wish, but the reality is that all these companies are incentivized for short term profits. They will try to get away with anything. Most don't care about your long term health, and the 'anything for a buck' attitude means that they will hide any subtle, hidden or long term negative effect for the greater good of the near term balance sheet.

But having a smart government to enforce those laws is difficult in a land of the uneducated. The temptations to reduce meaningful debate into trivial one liners of effective marketing is too great. The desire to do whatever it takes to get re-elected in the short term IS more important than the long term good of our nation. Honor and integrity are gone. You almost don't even remember what they looked like.

Where did the integrity go? It used to be that you could trust journalists. Now you have major "News" "anchors" make up stories about concentration camps after Katrina and no one goes into an outrage. Where's the intellectual honesty? Who are the protectors of truth any more? The short term profits for entertainment news outweighs the long term harm of a misled public. Maybe we should trust the BBC who have less of a vested interest?

We can't take the time to read the fine print of a credit card or loan and how they will jack rates to 30% at the first opportunity. For a major financial decision that could bankrupt you it's probably worth the time. Then again, it's not like I read every license agreement in a software update either. I sign legally binding agreements I don't read all the time. The need for instant gratification outweighs the considerations of long term benefit. And of course we know that we are being misled by all these parties. Yet we can't even legislate basic protections against financial institutions from clearly deceptive and malicious practices. We've come to accept it because the short term lazy acceptance is easier than the longer term fight to reform.

That's because we are a short term nation. A short attention span nation. A short bus nation, if you ask me. And in a world where truth is undervalued, underrepresented and underground, what is the role of government? I would like to say that the role of government is to help represent the truth, but the government can't have that responsibility or you're back to 1984. Some transparency would be a nice start.

We no longer have vision. We no longer have long term goals. What should America be in 2020 or 2050? What is our generation's moon landing? What is our great emotional, intellectual or moral revolution? The role of government should first be to define who we are, what we stand for. It's been lost in the rhetoric and I don't even know the answer to the question any more, if I ever did.

I wish I could present better answers. I wish I could say, "aha, here is the solution." All I can say right now is that listening to the current political conversation makes my teeth tingle until I shiver.

Marketing's Dueling Duality About Trust

Moved on from Cialdini's book on Influence and am now reading Seth Godin's Permission Marketing, which is a must read for everyone in marketing. There was an interesting point of overlap: Americas sensual overload on ads. Godin does a nice job explaining how this came about from the emergence of mass media and the rise and diminishing ROI of "interruption marketing."

What was interesting is that it is clear that modern society is overloaded with assaults of information. Cialdini argues that what sets us apart from animals is the ability to make order of all the info coming at us. But with such an overload, we are particularly susceptible to techniques that take advantage of our instinctual responses. We've taken order and created chaos. We took reason and created an environment where there is no time to reason. We've turned ourselves into animals.

Godin puts aside mass media and focuses on being different and learning to earn the trust of a few power users while Cialdini teaches ways to leverage instinctual response to get that initial trust (Godin relents that such sizzle and tricks are still necessary to spark initial interest).

Together they provide an interesting framework to capture and extend the attention and loyalty of customers.

However, it's interesting to note that preying on customer instincts conceptually undermines trust, but when done right is more of a sleight of hand. So being a great marketer means being both a trickster and a trusted advisor. A magician and a mentor. Interesting mix...

Buying Healthcare vs. Buying Health Insurance

Saw an interesting poster in a subway station as I was on a train. It whizzed by so I didn't see the name of the brand. But what it said was that for $79.99 per month you could purchase healthcare with unlimited doctor visits, coverage of standard procedures (Gyn, electro cardiograms, colonoscopy, etc.) and discounts on prescriptions, and no copay.

But was interesting to me is that it said: "This is not INSURANCE." And that somehow struck me. When we think about healthcare as insurance, we naturally think about reacting to an incident, not preventative maintenance. We think about fault and liability, not compassion and treatment. We think it as something that is optional, a hedge, not something people have a right to. We think about it as a money matter, not a life matter with all the pain, profound limitation and fundamental fear associated with it.

Framing the conversation is key. The words we use have both subtle and overt consequences to the ideas we are thinking about, like renaming the estate tax the "death tax."

Take a step back. What we are really purchasing is healthcare, not insurance. How does that affect the way you think the industry should work?

Real Time Ad Optimization: Data, Speed and Optimization

There's an interesting trend forming in online advertising. Right now you can purchase ads from ad exchanges by bidding on them. But what is that banner ad really worth? Depends on the site, the page, the person, the time and lots of other factors. People have been optimizing on some of the static stuff and basic behavioral and contextual information too, i.e. where you've been and what that means to you (that's right Mr. Porny).

But what if you knew everything about the user and the placement before placing your bid. You could optimize your bidding strategy. Impossible? Well, we are getting there. But it's a fascinating problem. How do you get all that info, process it, and come up with a bid in real time? How do you get so specific that you take advantage of all information but not so specific that your target is too narrow? The more narrow your focus, the smaller net you cast. How do you deliver the exact right ad for a million impressions a second? Tough stuff.

So what really matters? Is there some secret sauce? Well people are playing around right now with all kinds of info. Media 6 Degrees uses demographic info mixed with who your Facebook friends are (and you thought that was private right?). eBay calculates your propensity to buy based on previous site visits and other factors. But it could be anything and everything. You might be amazed what every ad network knows about you and what if that information was shared to vendors? There's going to be a lot of interesting development in understanding what makes the "right customer" ready for that exact ad, and it will be decided in milliseconds.

And if your net is too small looking for that exact red fish with blue gills, 1 ft long in the medittreanean, you'll probably miss out. With all that data, you'll now be able to realize that there is another correlation that really matters and allows you to extend your net. Maybe it's red fish with a spiny dorsal fin. There is going to be a lot of interesting work going out there on figuring out what really matters, and finally there will be the massive amount of data and computing power needed to do it with.

So what does this all mean? It means ads you'll want to click on. Ads that provide you value and enrich your experience even. It also means less ads, since each ad will therefore be worth more. It will be an approach that is used on the Internet, your mobile device and TV (which will be the Internet essentially anyway). It will be everywhere where you can be tracked.

Be prepared for a more personalized Internet. And probably a massive privacy scandal on the Internet like we haven't seen before. 2010 is going to be an interesting year.

Truth and Consideration: When Homophily is Murder

We were talking about race and different approaches that people take to resolving century old prejudices with modern notions of equality. She argued that people in Austin refuse to discuss race but claiming not to see it as a factor, which simply prolongs predispositions. And if you have been to Texas, even Austin, you know that racism, sexism and homophobia are pretty overt. Erika argued that the key is to recognize and discuss difference and celebrate those differences.

I wrote a blog a while ago on some notable differences between African Americans, their African counterparts and some discussions of evolutionary psychology, which of course is a very tricky subject given that evolutionary psychology has been used to justify racist policy in the past. My brother, Eric, argued that to even to discuss such things is to validate that difference and that was a danger. The mere coverage of it, perpetuated the perception of difference.

To me, the overriding principle in such tricky situations is truth. Intellectual honesty and curiosity is key and that to always consider every way the article can be taken, especially those who are not as intellectually honest, is a poor principle to follow. It subverts the greater good, the pursuit of knowledge.

Well, I struggled with this some more this morning. I am reading an interesting book on my Kindle, called Influence: The Psychology of Persuasion. One of the chapters is the effect of homophily on decision-making, how people we associate as similar to us can affect our decision making. Now this bears itself throughout history in some well-documented cases. The Sorrows of Young Werther, a novel by Goethe in which the main character commits suicide, prompted hundreds of suicides throughout Europe. Then there is the behavior of people in emergency situations are much more likely to act if there aren’t other people around who are also wondering whether to act or not. It’s group paralysis as we look for social cues on whether to act.

But this is documented in other, absolutely bizarre ways. For example, after a well-publicized heavyweight bout, there is an increase in the homicide rate. Violence on TV, violence in life … makes sense. But what’s fascinating is that if it’s a multi-racial fight, if the African American fighter loses, there is an increase in African American homicide rates, and if the Caucasion loses, an increase in fatalities among Caucasions. So overt violence maybe makes sense, even with the strength of association of race. Maybe we can trigger a natural violent instinct. But is there more here?

This one truly baffles me. After a well publicized suicide, the rates of car accidents and plane crashes in the area goes up. Could such a communicated case, similar to Werther, trigger sub-conscious mimicry? And mimicry in the face of our primal nature to survive? That’s pretty amazing. So if life or death is in the hands of journalists who report on a suicide, should they bury it? Should they be concerned about the potential effects? Should we report on the depravity of the human condition, if it encourages repetition?

Seems like a pretty tricky line that extended could be used for justification of Orwellian policy. That’s why I like the simplicity of honesty, not that's it's always simple. But I guess this answers the age-old adage. “If all your friends jumped off of bridge, would you?” You would. Just hope that it doesn’t end up on the news.

Fight for Control of Your Internet Experience

There is an interesting thing going on that I predicted a while back. There's a fight for who gets to present your Internet to you and who gets the ad impression. You probably have seen glimpses of it.

For example, you probably have noticed that sometimes when you click on Facebook there is a little toolbar at the top that says that you were directed to the page from FB from a certain person. They were playing around with it a couple months back. They were invading sites outside of the Facebook domain. Just a couple pixels at the top, but it is invasion, which is why they probably removed it recently. Imagine a world where the person who links to you controls your user experience.

Then there are some of the URL redirection services like tinyURL, bit.ly or ad.ly. On some of them, when they redirect they had an ad on the top. So even though you are now on the NY Times, there is an ad at the top from another service. They have been moving away from it lately, but there is experimentation.

I mentioned one example of intentionally poor design in Internet Explorer on my recent post about Microsoft. They intentionally take advantage of every typo and mis-step as an ad opportunity.

But as I found out this morning, there are a lot more players in the Internet chain that can take advantage of tricks like this. Today my ISP, Time Warner, wanted a piece of the typo pie too. My Firefox browser only corrects "yahoo" to "www.yahoo.com" if it first gets a 404 error from the initial request. But the ISP can do that work and just return a valid result off the initial request. So Time Warner wants a piece. Where else could they insert themselves? Couldn't they alter the HTML and create a frame just like Facebook?

There are many creative ways to make lots of incremental revenue based on the linking structure and inefficiencies and errors of the Internet. I've got a couple creative ideas, but the point is that every link has value. Value to the place you are linking to and value to the property you are linking from.

Here's another example. You may notice that every link on Facebook or on Google is not really a pure link to the website. If there is a link to the "www.NYTimes.com" when you click it, it actually activates a Javascript or other service on Google or Facebook to record the click, before sending you off to where you are going. Why is this important? For Google, recording what people are clicking is key to optimizing their algorithms. It started with optimizing ad clicks, then the same approach is being used for organic search. For Facebook, they similarly want to know what to show and whether that Fan page of yours is spewing spam, or links that people care about it. They prioritize good links in your feed to make your feed better.

The point is that there is a wealth of info from augmenting the simple version of the Internet, controlling data and controlling the display experience. The question, of course is what's next? Where are there unrealized revenue opportunities in the existing structure? Could there be a way to get pennies, millions of times a day? There are...

The Confluence of Digital Marketing and Traditional Brand Marketing

I had an interesting conversation with a friend of mine who is a SVP of marketing for Bank of America that reminded me the importance of bridging the gaps between digital and traditional marketing. Now as a digital guy, I usually think about it in terms of what traditional marketing has to learn from the digital world, but this conversation reminded me that it's a biased approach.

Digital marketing, most specifically Internet marketing, is amazing in it’s exacting nature and real time feedback. I can put a campaign up targeting 36-45 year old married women who have expressed an interest in cheerleading and that day know what I spent, how many of them came to my site, whether they registered, whether they created a group on Weplay, whether they invited anyone and how much they spent. These are the important things to my business and I can know exactly how the campaign performed and make changes. Maybe I change the wording, the creative of the ad, and in fact on launch I probably had at least 2 versions up to test which one did better (A-B testing). And I probably A-B tested the landing page too. So I am constantly optimizing. As soon as I have enough data to declare a winner, I use that as a baseline and try a new test. As long as the incremental value is worth my effort, then I keep testing until I am a well-oiled machine.

Of course I also do this across all my campaigns, targeting and segments so I am slowly weeding out the campaigns that don’t perform so the aggregate performance is great. There are some tools that help with this automated bidding, since campaigns can be optimized by single metrics like cost per registration, cost per group, revenue per cost, etc. The key mantra is always be testing. Always be improving. The only creative, and thus human, decisions on an ongoing basis are wording and basic creative, which a very junior person can do. It’s a machine.

The problem is that traditional media doesn’t have the metrics and real-time feedback so this process is completely different. Imagine creating multiple TV commercials and trying to measure which one was more effective. Tough. Even if you had an answer, how long would it take to change the programming, the budget, reshoot a commercial and leverage that info. The tracking and correlation is difficult and takes too much time. Clicks are instantaneous. And imagine the damage of having a bad ad. I can quickly pull an ad off the Internet, each of the tests in digital are small so they don’t need the same level of effort, creative or buy in. Traditional marketing is slower, more time intensive and each campaign casts a wide net.

So the exact mantras of digital marketing set an unrealistic expectation for traditional marketing. And frankly, the digital guys look down on the traditional guys. How can you run a high cost marketing campaign and not know the ROI? Well, large enterprises have developed sophisticated models to help calculate the ROI, but it still is a little fuzzy and there are a lot of moving parts so you can test the overall ROI, but not pinpoint the exact phrasing, creative, or in store collateral that converted the customer.

But it’s too easy to get caught up in the glory of digital as my friend pointed out. For Bank of America, digital is fine, but they don’t run their business by pure cost per reg. People go into the banks to set up accounts. And measuring how the Internet ad affected consumer behavior and brand impression is not something us digital guys specialize in. When you care about branding and traditional commerce, we are less sophisticated specifically because it’s contrary to our exacting and real time philosophy. It’s not that we can’t apply the same models measuring the impression of a brand before and after an ad just like traditional media does with ad spots. We just don’t. It’s not that we can’t cast a wide net with a single ad to measure effect, it’s that we think it’s against our principles. Why not optimize and measure the clicks, exactly?

Well, it’s easy to forget in our digital fantasy that the world is more than clicks. For Bank of America, it’s brand that drives the business. When you think bank, who do you want to go to? And for a traditional media guy who believes in art as much of science, I imagine digital looks like task work for ajunior guy. It’s a tactic, not a strategy. I imagine they look down on us.

Well traditional media is declining and digital marketing is expanding, so we’ll see an increasing mix of exacting methodology. But in the process, I expect a lot of the traditional guys to come over and teach us digital guys a thing or two.

Why I Will Never Go Back to Microsoft

Been a tough couple weeks since my hard drive crashed. First Mac issue and for a variety of stupid reasons, I hadn't backed it up in over a month. So it was off to data recovery for 2 weeks in which I squatted on a Dell.

After Mac-ing down for so long, you forget all the inefficiencies and annoyances of working in Windows, even XP. Something ironically called "SmartAlert" kept popping up telling me iexplore.exe wanted to access the Internet and I was in danger. That's right, Windows was warning me about it's own browser trying to connect to the Internet. Then my anti-virus software AVG. Then Excel. Crazy. Number of pop ups in one day? Guesses? 75. 75!!! Worst part is the checkbox that said remember the setting (Allow), which never seemed to remember. Uggg....

Or when I plugged in a monitor, I had to manually go into settings to activate it. As if me plugging in the monitor isn't statement enough of my intent. Yes, activate the monitor automatically.

Or the fact that in IE, unlike every other browser, doesn't recognize what you mean when you type in "NYTimes" without the ".com". Why not just try to add the ".com"? Well of course it opens up the search page and look it's and ad view opportunity.

And that's really the rub about Microsoft. They design products for their business not your life. They care about the ad view, not about your ease of use. And this is endemic to all their decisions, or lack their of (the other big design issue is that they cram everything in and don't know how to say no for the sake of simplicity). They want to bundle, cram, charge, lock you in, make it difficult to switch rather than build products you will adore.

And they deserve the criticism they get. Like the Apple ads lambasting them for not creating a migration from XP to Windows 7. You know there was a conversation about this where some draconian bastard stated the case that not creating a migration from 2 versions ago sets a precedent that users always have to go to the next version, which means more revenue.

Well, MSFT. I look at the bugginess of Excel on a Mac and all the intentional ways they hamper open browser standards and interoperability as a failing strategy. So I hold on to my Apple stock, revel in Linux-based netbooks and celebrate every point of market share lost.

I wonder if Microsoft actually has conversations about how little time they have resisting the wave of open standards at which point they will be ill positioned to compete with their culture of poor design and malicious practices.

In this, they are a perfect example of Michael Porter's framework on innovation, where established players find it too hard to undermine their core business by investing in disruptive technologies. It's too hard to align the organization's established departments with the ones trying to kill them. So you look at the profit potential of migrating the business and the risk and find that it is easier, and more importantly more profitable, to extract revenue from existing customers who lag the upcoming technology switch. Less investment, extract revenue.s

That's a lot of words that basically say that it is more profitable to slowly die as a dinosaur then to try to turn into a bird. Extinction is a slow, gradual process and is more than just a path of least resistance but sometimes an advantageous strategy.

That said, F U Microsoft for the literally billions of man hours lost from Vista and all your other recent "innovations."

I Speculate My Money Isn't Safe

So I shorted the market. In fact, I double shorted it (DXD). I just can't believe that investors think we have recovered. Real unemployment/underemployment is nearing 20%, the worst levels since the Great Depression. Yet the economy grew at a 3.5% rate. Really? Ok so there was the stimulus package and even GM was up with cash for clunkers. But that really is just borrowing to pump up the numbers, and even that isn't helping employment.

Next year you have more ARMs than ever graduating to terrorist rates when the earning potential of mortgage owners is lower than ever. It's hard to imagine that the next wave of the housing crisis isn't just around the corner. So we are subsidizing home owners, renegotiating rates at a loss at government agencies and eating the losses at Mae family of institutions. We are borrowing to pump up the numbers.

And then we are printing money. Lots of it. Tanking the dollar, creating inflation which at the same time devalues our debt. We are borrowing to deflate our debts. But our debtors are none too happy with that.

In real terms, have we really seen an increase in the market? Seems like the market has performing at the exact inverse of the dollar. How much more can we borrow before everyone sees it's all a sham?

But there is also another side to the story, as my friend Simon points out. A market isn't necessarily built on fundamental values. The dollar is a fiat currency not tied to the value of gold. Profits can be manipulated. Future outlook is speculative. And at the end of the day, it's a virtual market with a certain supply of money and demand for stocks. Just like the oil speculation of 2006-2007, in which 10 times more oil was traded each day then is sold in a year, the stock markets behave according to supply and demand too. So Simon would argue that there is still a lot of money looking for investment. More demand for stocks than supply at the price.

Well that could be. And maybe, just maybe the market will go up speculatively. But all bubbles pop and eventually the bill for this has to get paid. I am happy we didn't have a total financial system reboot. But I think we are far from out of the woods. And most of my friends are beginning to run for the hills.

I am hedging my bets. Gold, foreign stocks and even shorting the Dow (although to a certain extent that's a bet against inflation). I am just not buying all this borrowing.

A Half Billion Reasons to Reform Election Laws

I went to the New Jersey gubernatorial debates last weekend and it was a bit underwhelming. Not because my candidate, Chris Daggett, an independent with real ideas didn't clearly win like in his first debate or that his competition was clearly more polished than in their first debate, although all that didn't help. And not because the pre-debate rally wasn't fun. I secured a megaphone, led 50 people in cheers and made fun of the other candidates and their supporters (clever retorts about college republicans, bad suits and trench coats and raver antics). I even had a professor protect me from Corzine's union boys who were looking to get violent.


No, instead it was just another reminder of why this system is so screwed up. It took half a billion dollars to elect an eloquent, Harvard educated law professor against a party who led the collapse of two wars, the world financial markets and a major American city. Let's reiterate. $500 million. For one candidate. Maybe that's just $2 for each American. And maybe that's 7,000 more teachers. It's a big bloody number. Like a corporation. A conglomerate. If the democratic party were a corporation, it would be a fortune 100 company at the very least ($25 billion in revenue).

So why is campaign finance reform so hard? Do we really need all the TV ads? All the commercially directed, poll influenced, slandering attack ads that make you want to hot snack in your mouth. The complete lack of understanding of the policies, the counterpoints and any semblance of a policy debate is sickening, maybe even more than the fact that your average American couldn't understand it if it were to go on.

"Mr. Corzine, NJ is so far in debt it is on the verge of bankruptcy with a record deficit and debt burden. How do you get back to fiscal sanity without constricting the fragile economy with higher taxes? You have 1 minute, sir, and please contrast your plan with each of your opponents'."

What a joke. Just enough to smile, spin and throw someone under a bus.

Isn't it simpler? Drastically less money for commercials. More mandatory debates with a round table format, lengthy answers, candidate questions to each other and full back and forth. Specifics to plans mandated. No BS Palinesque avoidance answers.

We live in a world where the more you say, the more material your opp0nents have to attack from their war chest on mainstream TV. Ideas are penalized. Marketing speak rewarded.

I saw today on CNN that 7 out of the top 10 radio shows are conservative talk shows. So much for liberal media right? Yet 65% of America believe in the public option. In the battle of ideas, Democrats are winning. No, no. That's not right. It's more of a liberal trend with which Democrats are snatching defeat from the jaws of victory. If the Democrats could get their ideas straight, they could change the political game to reduce the election process to ideas.

Maybe that's naive. Maybe the Democrats know that they are just as bad at talking about ideas as, well, a third grader. But how can they think that they will get more money than the big business Republicans. And who wouldn't support massive campaign finance reform? Wouldn't they win big votes by being anti big business and pro voter? You could be the voters' party.

I don't get it. But this spectacle has all the intellectual honesty, strategic intricacy and the production values of a McDonald's commercial. Well, I saw it first hand. Sorry to say it. But I'm not lovin' it.