This is broken.

If I can be so brazen as to add to Seth Godin's excellent 2006 Gel presentation, This Is Broken, I'd add an additional category to his list of broken things called "It made sense to us at the time" (something I discuss here) and suggest that an earlier blog post of my own hints at one of the possible solutions.

What's broken in your experience?

I had a broken experience yesterday on Amazon. I purchased four MP3s files from three different albums by the same artist. I was forced to check out four times, and further, when I pressed the back button, it returned me all the way to the main page, not the sorted list I had created. Took me close to twenty minutes.

Broken.

Know when to fold 'em.

I know. With that title, I've put a tune in your head you'll not get out for some time. Still, you could do worse than a 70s classic from Kenny Rogers. In any event, my point, and I do have one, is that that lyric has never been more appropriate in a business context than it is to the changes made possible by today's electronic media.

The Pirate Bay case (click here if you are not familiar) came to a conclusion today, complete with jail time and seven figure fines for its founders. So now the entertainment industry has a win in their column based on foggy reasoning, short-sighted strategy, and a desperate effort to hold on to their buggy whip business plans. Now they just have to leverage that surprising win by filing the same suit against thousands of copycats.

Good luck with all that.

The newspaper industry is no different. Teetering on extinction, there has been no shortage of attempts – legislative and otherwise – to support the newspapers' clearly flawed business model. Think of the effort to start a newspaper today with new investors: The ten-second pitch for venture capitalists? "We deliver news and opinion late, in a cumbersome and environmentally suspect format to individuals whose iterative feedback takes days and requires postage."

Well, sign me up!

From efforts to reduce regulation (rarely a bad thing in my mind) to subsidize newspapers through tax policy (rarely a good thing in my mind) the concept of a newspaper is so central to our culture, or so it is argued, that its simply 'too big to fail'.

Like banks. Or car manufacturers.

It's long past time to simply face the reality that newspapers, records, movies and other media are competing not just with new media, but in a brand new context. Traditional distribution methods for everything from news to music to movies are obsolete, and there isn't a tort or an injunction or any lawyer in the world that can stop it.

One of my favorite quotes on the subject is from US Army General Eric Shinseki: “If you don't like change, you're going to like irrelevance even less."

Or perhaps more succinctly put by that other sage, "You gotta know when to walk away, and know when to run."

UPDATE 4-23: Excellent opinion piece regarding Susan Boyle sensation that indicates that the amazing viral nature of the clip has yet to monetize for YouTube or ITV as a result of the battles between old, new, and newer revenue models.

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• Creative Destruction Happens Quickly; Those Who Wait End Up In The Rubble (techdirt.com)

Of Babies and Bathwater, Part II

Image by HubSpot via Flickr

Given that any job opening today one step above entry level generally requires three to five years of experience in the field to be considered merely sufficient, what does it say about the plethora or Social Media Experts flooding the marketing field today?

In a field barely five years old, it is difficult to suggest that even Mark Zuckerberg, founder of the accidentally successful social media site Facebook, knows enough to consider himself an expert at how social media should be efficiently added to a traditional marketing mix.

"Traditional marketing mix? That’s because social media breaks all the rules! It isn't traditional!", will say my distracters, and by doing so, prove my point.

Didn't we hear this, a dozen years ago, when Internet entrepreneurs suggested that those of us still relying on P/E ratios didn't understand that 'click-thrus' and 'page views' were the new currency? "That’s because the Internet breaks all the rules! It isn't traditional!", I seem to recall them saying.

The blog entry below this post, linked by Zemanta, explains just one of the reasons that marketing in this environment isn't as simple as latching onto the latest marketing tool. Saying you 'do' marketing is easy. Actually doing it, and doing it well, is far more challenging.

Social Media is a new tool for marketers, a potentially efficient way to accelerate personal conversations with a brand's 'tribe', as Seth Godin would describe their most vocal and active consumers. A new tool, and just a tool, like the web, television, radio, newspaper, town criers, and signs etched in sandstone that came before it. It is not a revolution - no matter how successful political activists were last year in leveraging the media to communicate with… other political activists.

Twittering, blogging, actively posting on Facebook, sharing photos on Flickr, posting on Digg, are all experiential. Experiencing it doesn't make an expert. I'm on my fourth dog, yet I still feel compelled to take it to the vet for treatment. That's the critical difference between having an experience and being an expert.

Even Social Media Experts at established firms like Agency.com tried it with client Skittles and succeeded only in spiking discussion of the candy's brand in a negative light, visits to the site equally mixed between social media "experts" blogging on the ill-fated experiment and giggling preteens excited to see their indiscriminate use of foul language posted prominently on the site.

Integrated Marketing Communications remains a proven and successful strategy for developing and executing successful marketing campaigns. Integrating Web 2.0 and Social Media will most certainly be a critical part of this planning. But it cannot be done effectively in a vacuum by self-proclaimed social media experts lacking essential marketing skill sets and an understanding of basic, proven marketing concepts that can leverage these new tools to even greater influence. That’s babies and bathwater, experts and experience.

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The marketing of consumer debt

I'm old enough to remember that in my youth, the preeminent bank card was called MasterCharge. Every time you used it, it reminded you what you were doing. Charging. Going into debt.

At some point it was changed to MasterCard, evoking Indomitable Power over the darkness of want. Then along came Delta, which became Visa, a travel pass to your heart's desire, and then Sears launched Discover, perhaps a new way to find the fabled city of El Dorado.

I am reminded of a statement by GSD&M's Roy Spence, who once advocated a Secretary of Marketing to replace all other presidential cabinet posts. In this case, that idea could be easily tested: instead of the new rules and regulations that are about to be put into place by regulators regarding fees and interest on credit cards, perhaps we instead could let the free market establish those rules, with the regulators requiring only that the cards brand themselves as Slave2Debt (MasterCard), Passport To Bankruptcy (Visa), or Devoured (Discover). Then let's see how often they're used over cash when consumers pull that message out of their wallets with every purchase.

I'm kidding of course. But only because government regulators wouldn't know good creative when they see it.

Lookin' for latte in all the wrong places

When I was last in Zurich, in 2006 (negotiating a settlement regarding trademark infringement by Swisscom - shame I don't ski) I took a few hours to explore the city on foot. After I had passed the fourth Starbucks, it struck me that I had likely traveled 16 to 20 city blocks, so made my way back to the hotel. I had counted my distance in Starbucks, not blocks. The same could have been done in every American city and virtually any other city in Europe. And then.

Three years later, Starbucks has shuttered hundreds of locations worldwide and what was once an iconic brand and a unique experience now looks to McDonalds Value Meals for salvation. The thinking must be that they are looking for ways to ingrain Starbucks into our routines the way McDonalds has done. Yet in addition to the grab and go $5 latte market, Starbucks was always a destination for the self-employed, the freelancer, the coffee networking types to meet and discuss business. With this in mind, just how much business do Starbucks executives think is conducted at McDonalds?

In the interest of fairness and full disclosure, I am not privy to extensive research regarding Starbucks customer base. Anecdotally, however, these types of meetings, good for about $10-15 a table and high table turn, are a critical market - and in my neighborhood, Starbucks are losing these common meet-ups to Paneras Bread. Paneras welcomes this type of guest with large tables and free wifi, which activates with a polite reminder regarding etiquette in the use of the facilities. (Starbucks is still trying to wring revenue from agreements with AT&T and T-Mobile.)

There are other local restaurants, regional and national chains that serve a similar market, but few are as effective as Panera at creating an environment as specifically well-suited to the needs of the increasing legions of the 1099 workforce.

Last year the 1.3 billion (revenue) Paneras stock soared from $32 a share in January to about $50 a share at the end of the year with a debt-free balance sheet. McDonalds, meanwhile, struggles with systemwide sales off by 4.6% in February. McDonalds might be aspiration for Starbucks in size and brand ubiquity, but Paneras reflects the needs of its customers.

In latte as in life, it is important not only to understand your competition, but to be certain that you've properly identified who they are.

The Internet, in dog years

This is not your teenager's Internet.

The latest news from the Pew Internet and American Life Project will not surprise a colleague who has a 90+ year old father who regularly "Tweets" his family.

Older Americans are going online more than ever before.

According to the study, in the past three years the 'hockey stick' in Internet adoption has been in the 70+ demographic. 70+, folks. God love 'em, these are the same folks that still re-use aluminum foil. Growth in Internet use among people ages 70 to 74 increased by 19% and for those above 75 (b.1924!) growth clocked in at 10%.

Other studies concur that older demographic groups spend more time online than their younger counterparts and while many go online to get health information and visit government Websites, the growth actually stems from use of the Internet for activities such as games, watch movies, use social networking sites or read blogs.

The assumptions and biases that the Internet, social networking and digital media are all tools to reach younger demographics needs to be readdressed by marketers as in this economy particularly, no opportunity to reach out to prospective customers should go unexplored.

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How much is a friend worth?

A month or more ago when Burger King was running its Facebook promotion that encouraged users to delete 10 friends to receive a free Whopper, a friend of mine posted on his status that he "is not going to give up a friendship for a Whopper." Well, that’s a kinda low threshold for my value as his friend, though to be certain, I'm glad I qualified.

So what is a friend worth? Poets and songwriters might couch it in elegant prose and a clever turn of phrase, but a new study by University of Chicago Economics professor Gabriella Conti affirms that being popular – particularly in high school – is quantitatively valuable later in life. In the study, Conti and colleagues measure the association between popularity in high school and later wages.

From admittedly dated data (the raw data was gathered in 1975 from 4000 men who graduated in 1957) The subjects were asked to name up to three of their closest friends and used the number of times ta person was mentioned as a measure of that person’s popularity, and then compared that to a person’s earnings.

The takeaway?

They found that, after controlling for variables, each extra close friend in high school is associated with an increase in earnings of 2%. The study concludes that either social skills carry forward to the working world or simply, friends tend to help friends.

Given the subjects and the data are dated, it begs the question as to whether the data carries forward to friends through Social Media net out as an increase, and if friends that are exclusively 'virtual' friends have the same impact.

Either way, its bad news for social misfits who take solace in the idea that one day they'll be lord and master over their current adolescent tormentors. The data doesn't seem to support the fact that the computer club president will one day be in a position to hire and fire the varsity quarterback. On the upside, years later he might still be able to hack that football hero's fat bank account.

Silly Skittles, this trick is for kids

Okay, so by now, everyone knows that Skittles jumped head first into Social Media yesterday, and by today (24 hours later) has recognized what many of the rest of us already had known: its a shallow pool. Or a pool of shallow people. Either way, a bit of a mess. Like I wrote THREE years ago folks, just because its the new thing, doesn't mean its right for your message, or at least the way you might initially think about going about it.

A brief history of Skittles Marketing, ca. March 2 - March 3, 2009: "Edgy" ad campaign moves to Social Media by using the Skittles brand feed on Twitter as the home page, accepting all posts and all posts using the word "Skittles". (User name, "Skittles", incidentally, not secured. A lonely woman with a cat and an abandoned Twitter account, #skittles, presumably gets a lot of misdirected traffic.) After discovering a preponderance of negative and/or objectionable posts coming through on the Twitter feed, decide on Tuesday to instead use their brand's Facebook presence as their new website. Rude comments continue on both sites.

So, Skittles discovered that the prime users of Social Media and their demographic overlap. What they hadn't learned was that Social Media isn't about them, its about the community. By hijacking a third party site like Twitter and claiming it as your own, you are undermining the validity of that community.

Hint: Marketing is a lot more than simply mixing in equal parts audience reach, clever messaging, and good product. It takes a bit of thought, consideration, and strategy. Those leading the social media revolution are brilliant, truly, but just a little green. Hey kids, marketing fundamentals are still relevant.

Still, I wouldn't be too concerned. Former Coca-cola CMO Sergio Zyman built a career talking about the New Coke debacle. I assume this will have a silver lining as well.

Warning signs

The other night I had an "I Love Lucy" moment – I found myself desperately, and ultimately unsuccessfully, attempting to stem the tide of about 75 PSI of water shooting from what had been the stem control of an upstairs bath.

I had been ignoring a persistent drip for weeks.

Together with a client, I was speaking yesterday with a lovely woman who runs the Diabetes Education Center at a local hospital. The topic soon turned to preventative medicine, and the number of people who discover they have diabetes only after entering the ER with blood sugar levels in the 700s (that’s really high).

They were ignoring the frequent urination, constant thirst, weight loss, fatigue and other warning signs of diabetes.

Last month a neighbor had to be rescued from the side of a busy highway during rush hour when her transmission gave out and she slowly glided to a permanent stop on the gravel shoulder. The car had been recently detailed, however, so it looked sharp as it was hoisted onto the back of the battered tow truck.

She had been ignoring the thump and jolt from the backend of her foreign sedan for months.

And of course, we can all point fingers at the politicians and bankers and brokers and others who ignored the warning signs that have led to the current world financial credit crisis.

What are you ignoring? What are the warning signs in your own business that need attending to?

Are consumer complaints increasing? Is innovation fading? Are too many of your receivables over 120 days out? Do your employees fear the next 'all-employee meeting'? Has cash flow become the dominant topic over the water cooler, instead of tactics and strategy?

None of these scenarios are uncommon in a weakened economy. But what are you doing about it?

There are no easy answers to these problems. But analyzing the problem for weeks isn't helping. The quicker you act and the more decisive the action – any forward action – the greater the likelihood of preventing the situation from truly getting out of, that is, beyond your, control. Once a problem is beyond your control, it is too late and the options for a remedy, such as they are, are never good ones.

Okay, so this post doesn't say much that hasn't been said before. But if you've ignored the same reminders before, here's your chance to act.

Regardless of the specific corrective action required for your company's circumstance, the immediate requirement is communication. Internal and external communication to explain the company's circumstances to employees, partners and customers; reinforcement of company values and vision, and each individual's role in fulfilling the company's mission; the long term and near term future for the organization. And communication is a two –way street as well, that is, remaining open for customers to become real-time sources for feedback and product ideas, perhaps seeking out suppliers willing to extend finance terms, and listening to employees for suggestions regarding improving operational efficiencies.

The important thing is not to ignore the constant drip, drip, drip of market erosion and declining revenues, blindly hoping that a sudden macroeconomic recovery is around the corner, a rising tide that raises all boats. Don't ignore the warning signs. Take action now, because like my plumbing, the 'pressure' to take corrective action now is only building.

Marshall McLuhan and Social Media

Skype, Facebook, MySpace, Match.com, Vonage, eBay, YouTube, Craigslist… the connection between them is the connection between us, and all rely upon the Internet – or IP protocol – to operate.

It occurs to me that a few years ago the promise of the Internet was in the democratization of content and the free exchange of ideas. So today I'm not certain the cause of the hand-wringing over the growth of Social Media. Cynically I could suggest that our collective hand-wringing is simply in the fact that we don't accept Social Media as a valid tool (or proper use of our time) because we haven't yet monetized it properly. (44% of all web visits are to Social Media sites but only 5% of all revenue from the internet is driven from them.) All things, it seems, are accepted in time as we learn to make money with them.

While I understand the concerns regarding the lack of privacy of our youth's postings and the banality of photos posted by exuberant parents, it seems to me that Social Media – and similar applications of the medium – are simply the latest stop on the train to Marshall McLuhan's Global Village. It is, after all, the goal of an increasing number of projects such as One Laptop Per Child to bring the information and interactivity of the global web to remote, more impoverished parts of the world.

A JPMorgan survey from last November revealed that half of online social networkers were there to connect with old friends, while still more were there to interact with their current friends, sharing music and photos. There is a big time-waste with Social Media, say the critics – yet it is important to note that it is at least an interactive medium, unlike television.

The ultimate realization of the promise of the internet will be in its social aspects – connecting, sharing, even buying and selling. Whether in twenty years it will look like Facebook or appear more as holographic avatars in a room of mirrors is incidental. The thing that matters is that we all continue to communicate, regardless of the media.

Now if you excuse me, I need to research how to make money with Twitter…

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Phelps, Personal Branding, and 'These Kids Today'

Michael Phelps' recent stumble simply serves to underscore the critical requirement to actively build and protect one's 'personal' brand – especially online where a poorly lit photo from a lousy angle can become a sensation and tear down one of America's heretofore greatest athletes – not to mention the personal financial cost to Phelps in endorsements - as Kelloggs has already abandoned their multi-million dollar endorsement deal with Phelps.

Marketers have long recognized that with the growth of the Web 2.0, the term 'brand management' has proven oxymoronic, as the control over the perception of a brand is now more than ever before in the hands of the consuming public. Yet what of the impact on our personal brand? Those of us experienced enough to understand the importance of our personal brand (or 'reputation' to use an old-school term) are now leveraging social media to enhance it. And while readily evident to my generation, our youth appear not to understand or worse, not to care, that the consequences of their actions will appear today on more than their dreaded 'permanent record' –a manila folder in the principal's office – but rather, a new permanent record - another regret posted on a MySpace or Facebook page.

As recently as only a few years ago, an outlet for narcissism this dangerous was limited to the realm of celebrities and reality television. Yet today the explosive growth of social media (one of every twenty web hits is now directed at a social media website) has essentially created a world where we are all stars in our own reality show.

In a line I wish I had written, Lakshmi Chaudhry, writing in The Nation last January, derided the YouTube generation with this pithy line: “When it is more important to be seen than to be talented, it is hardly surprising that the less gifted among us are willing to fart our way into the spotlight."

In fact, I'm predicting that in the not-too-distant future we'll witness the advent of video capability on headsets so that we can stream our lives directly onto our own websites and Facebook pages. (Ironically I've determined that for some social media addicts, this will amount to a nearly 24/7 feed of them viewing their own pages.) SEE UPDATE

“Our character is what we do when we think no one is looking,” observed author H. Jackson Brown, Jr.

Absolutely true, but in a world where everyone is looking at everyone else, all the time, where is the room for such contemplation? When there are no dark spaces left for self-reflection, self-control or self-consciousness, is the movement toward this ever-increasing comfort in exposing our thoughts, our desires, and our backsides lowering the bar on what is considered ethical and moral, or just lowering the curtain on what we all knew was there all along?

In spite of recent growth in adoption of social media for the over-35 crowd, I'm still on the upper end of the age demographic for the technology, so my age may account for my views on the subject. Yet even forgiving for a moment my parental angst over what might simply amount to a generational gap in the way we view technology, the need for young people to be taught the basics of branding – particularly personal branding – is more urgent than ever before.

I had an email exchange about a year ago with an old friend whom I've known from high school, and a large part of the on-going discussion was non-specific regret over things said, fights fought, and hearts broken when we were 17. Nothing we did was ever beyond the pale for a typical American teenager, but the minor mistakes we made in high school never really impacted the men we became. It has always been that way. Except today, when seventeen year olds are codifying their spontaneous thoughts and actions in such a way that it will soon impact their lives and defining – essentially restricting – the person they will become.

As I use Facebook Facebookand LinkedIn to get connected and reconnected with colleagues from my early corporate roles here in Dallas, advertising years in New York, friends from high school and even junior high school (!), it is the branding wonk in me that is grateful that as an adolescent extrovert I was spared the consequences of access to social media. Yet regarding today's generation, I pause to consider the impact of a future web search that might bring up an intelligent byline they've written – alongside a photo of the otherwise respected author passed out at a 'kegger' years earlier.

Personal branding is as critical a skill to future generations as reading, 'ritin, and 'rithmetic. Yet unlike trigonometry, a working knowledge of social media's impact on personal branding will be relied upon again and again in their future. Adolescents today make choices that are under greater scrutiny and a harsher light than ever before, therefore discussion of ethical and moral choices needs to be highlighted at school and at home – along with the new visibility of these choices and their online 'permanent record'.

UPDATE, Aug 2010: www.looxcie.com 'Nuff said.

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No excuses

I recently re-discovered this quote from the inimitable Sir Winston Churchill and inspired, tried to build a blog entry around it, but in the end nothing I wrote seemed to add anything to his brilliant quotation that it didn't say on its own.

Apply it to marketing, selling, the economy, the environment, your marriage, the body politic or your now-fading resolutions; it all boils down to this:

"It's not enough that we do our best; sometimes we have to do what's required."
Sir Winston Churchill