Ok, this post is huge and may be painful if you’re not a huge fan of the Gartner Hype Cycle, Crossing the Chasm, Marketing Automation Tools, Inbound Marketing and marketing campaign analytics. To spare you a headache, here’s the bullets you need to know and you can decide if you want to read on.
The time is ripe to ask with new data available as part of Hubspot’s IPO, which confirms they are burning a lot of cash (like everyone else from startup to Amazon)
If the Gartner Hype Cycle holds, Inbound and Social Media are overdue for a beating from the press
Don’t believe the hype, effective inbound campaigns trump everything
Inbound is the right message for the mass market, and will continue to be even if the press beats on it. If it gets really bad they can easily switch the message to “Best of Breed Marketing Automation”
2nd Generation Marketing Automation will be about improving campaign performance based on the data vendors have aggregated. Easy to use automation of email and social media is just the price of entry for the market
Questioning inbound’s effectiveness is the 1st elephant in the room. Why so many marketing automation programs fail is the 2nd.
Hubspot’s competitors won’t bash inbound because the same arguments undermine marketing automation in general. This scores an amazing combo – unique story and unbreakable defensive position
Tom’s post is an excellent read with a lot of great comments, but to boil it down for you: Does a $34 million loss on $77 million of revenue after 8 years make you think that inbound marketing is not the cure-all that it’s advertised as?
Inbound Marketing has run the normal hype cycle, lots of press, books and events, all while Hubspot, a hometown hero for Boston, has kept this story at the core of their value proposition. Unfortunately I think both inbound and social media are overdue for some bad press, once you learn about Gartner’s Hype Cycle you can’t unsee it. A topic starts with a small group of innovators (for inbound I say the family tree starts at Seth Godin’s Permission Marketing), and the press hypes it up as the cure for everything for a couple of years. Eventually those stories stop attracting attention, then negative stories start getting published because they are controversial. Usually the size of the plunge is equal to the rise the topic enjoyed and as the tomato-tossing articles stop pulling clicks it’s reached the “Trough of Disillusionment.” At this point the press doesn’t care to write about it anymore and the market determines if it survives or not. Finally, at this point, press has nothing to do with it, if it sells and customers deem it fit to survive, it does. This is just how the press works, it’s independent of whether or not “Inbound Works.”
Aside: It wouldn’t surprise me if some variation of one-to-one marketing is the “post-inbound” marketing to get hyped. “Imagine tailoring your marketing campaigns to every individual prospect and customer based on the big data in your grasp.” That makes a good story, even if it’s not possible.
The story of Inbound Marketing is critical to the mass market of people that buy marketing automation. These are the marketers that only move in fear, their primary motivation is “Don’t screw up this gig” and they are not going to experiment unless someone else has already proven it works (this is the group under the big part of the bell curve, where the money is made, and if you want to learn more about the difference between the early adopters and the mass market check out Moore’s Crossing the Chasm). These are people that loved buying ads and knowing that they would get 1% of the audience back as prospects or customers. This group needs all the stories of companies that spent significantly less money by blogging, creating videos and white papers and were able to generate all kinds of business. These people are the ones that have been crushed by the information that buyers now have at their fingertips thanks to the internet. By giving these prospects some marketing campaign options that are less expensive by an order of magnitude at the same time as old sales and advertising campaigns are becoming less effective by an order of magnitude it’s no wonder everyone is excited to talk about Inbound.
As a company that both sells and practices Inbound, Hubspot has a picture of the world that anyone who follows marketing would love to get their hands on. They have the data on how well campaigns work and where the breaking points are. They no longer produce their weekly video show, but they are advertising on Facebook so at some point the return on some kinds of inbound isn’t there compared to outbound advertising. Oh, and they have similar data for all their customers too.
So, does Inbound work? Based only on my personal observation of around 100 companies, I have no doubt whatsoever that “Inbound Works”, but the funny thing is I don’t ever think in terms of “Inbound/Outbound”. You just pick some campaigns to work on, do the work and see if they grow the business. Anything that helps you do more, or better measure what you have done will be a valuable tool.
Another reason the effectiveness of inbound is questioned is that not all marketing automation customers are equal. All the marketing campaign tools on earth won’t fix a product customers don’t want. My gut is that this is why you hear churn come up as an issue for marketing automation, there are too many customers that think marketing automation will be a silver bullet for their crummy product rather than a tool to automate already successful programs.
Yes, entrepreneurs have burned a huge pile of money on email and social media monitoring software. They don’t care. The usual model is: get to $100M to please The Street for The IPO. The Street knows that companies do “Grow At All Costs” to get to the IPO, they bet on the business model being sound so that if they want to scale back on the new customer acquisition and do some layoffs the profits will magically appear.
The savvy investors here are looking forward to the next generation of software that can determine if your marketing is doing as well or better than the industry standard, and if it’s not, prescribe how to fix it. It will be able to say “Well, the average campaign like yours that sells to IT professionals in banking normally does 5x better so obviously your product must suck or your messaging is garbage.” Marketing automation companies will be the first companies ever to have this kind of data and that’s what this space is all about for investors. If you have enough data, eventually you can build a map of all the inbound/outbound marketing campaign types and rank them in order of possible effectiveness and return. A lot of today’s marketing campaign choice is rummaging around in a dark room. The future of marketing automation is a flashlight to see how well certain types of campaigns do on average rather than having to trip over them.
One question I had after reading the original article was “Why doesn’t a Hubspot competitor take shots at Inbound?” it would be easy for someone like Adobe to say “How’s your blog doing? Yeah, we thought so. Let us tell you about outbound stuff that’s better than ‘The Top 5 blog lists nobody wants’.” In the comments of the Convince and Convert post my discussion with Lee Dalton led me to see the second elephant in the room: Tom’s original question isn’t just for Inbound, it’s for all marketing automation vendors. Do these tools make you more money? Unfortunately many times the answer is no. Many customers focus more on the tools than doing great marketing programs. Customers can go one of two ways – they buy a marketing automation tool, have a great product, do a bunch of great marketing and all is good. The other way, either the product stinks and no amount of marketing will get people to buy, or they thought that buying a marketing automation tool would write all those great blog posts and email for them and they end up only using 25% of the system’s functionality then dropping the tool or losing their job over the next 18 months. UPDATE: Kathryn Korostoff published a wonderful courageous post about a $30k marketing automation failure that’s a common testimonial in the vein of “Marketing Automation is like giving someone’s kid an espresso and a free puppy.”
Inbound is why Hubspot does a better job of marketing than the other marketing automation vendors out there. They have a unique story with Inbound, yet no other vendor is willing to challenge it. The arguments that could be made against inbound also challenge outbound activity and would destroy the stories used to sell these tools – in other words, nuke the entire market.
What does Hubspot do? If Inbound gets to a point where it’s no longer an advantage they can change the message to “Marketing Automation” with no difficulty. I would guess that’s the real roadmap and the reason behind the IPO is to provide the funds so that they can make acquisitions to create the ultimate marketing automation suite.
The next step for marketing automation is clear: it’s not about providing the tools, it’s adding expertise so that their customers run better campaigns. They know when the messages should drop, what subject lines work, what offers pull. The first marketing automation vendor to leverage their data and generate a decent 12 month calendar and mail schedule for any vertical will be the first steps in second generation marketing automation. Last generation’s marketing automation systems made great marketers more effective. Next generation marketing automation will make all marketers more effective.
Last month I had a chance to speak with Jason Calacanis in an interview for Marketing Over Coffee. Here’s the audio if reading isn’t your thing:
John: Hello, welcome to Marketing Over Coffee. I’m John Wall. We have Jason Calacanis with us here today. I’ve got two links if you want to check out his history. You can go back and look at This Week in Startups, an interview they did at Penn State where he talks about coming up as an entrepreneur. In another link, an interview with Jerry Colonna which has some great stuff as far as start-ups and coaching.
The biggest thing that pushed me to give Jason a call to try to get him on here was back in November he did a post called “Google Wins Everything” on his newsletter. As we get right into this, Jason, you just blew me away with this post. I don’t understand why it didn’t get more action and run further. Before we dig into it, can you set it up for us? What drove you to write this?
Jason: I’m in a fortunate position as a writer in that I don’t write for a particular publication. I write for myself when something is on my mind. As a writer, I tend to write about the things that I’m fascinated with that I feel people aren’t talking about. When I used to be a full-time journalist and editing a magazine back in the days working as a reporter, you had to file. So sometimes you have a weak piece, and sometimes you have a strong piece. I only write something if it’s really strong. Most of the stuff that I write is thrown away and I don’t hit the publish key. I don’t have an editor or any time to do it.
So this is just one that I was feeling building up over time, which is about Google being the most powerful, aggressive, ambitious, and intelligent company out there. At the poker tables I play at with powerful people, as it were, the discussion kept turning to, “Wow, Larry Page is going for it!” To say “lean in” would be a gross understatement. To have that many smart people and to spend your war chest of cash in such as aggressive way – moonshots, etc. – is unlike anything we’ve seen in the history of business, and perhaps humanity.
I don’t know that any other organization has tried to change the world as much as Google is doing now, except for the United States maybe. And that’s not a company, that’s a country. As a concept, what Google is doing could be as important or as ambitious, if they hit a couple of these things, as the formation of the United States, which I know sounds super-hyperbolic. The United States stood for so many things when it was founded, and its success is a big part of the reason why Google is able to do what they do.
Going after a life extension, artificial intelligence, robots, self-driving cars, wearable computing, DNA, media advertising, and search – all of the stuff concurrently and that’s the stuff we know about. But what about the stuff we don’t know about? You can be sure for every interesting thing we hear about, there are five more that we have not heard about yet. It certainly is in stark comparison when you look at Apple, which obviously has more money – $140 billion and the largest hedge fund in the world. They are debating with Carl Icahn about how much of the money to give back. Meanwhile, Larry Page and Sergey are saying, “How can we spend this money more interestingly? Oh, Nest is available for $3 billion? Let’s buy it.” That’s a long way of saying that I wrote the piece because I’m in awe of Google.
John: There are two things I wanted to follow-up with that. You’re right on the mark. You talk about America and the United States – in the late ‘60s or early ‘70s, we looked to the government to do NASA and to do literally moonshots. Now here we are 40-50 years later and this has to come out of the private sector because the government can’t get out of its own way. Do you think that’s the way this should evolve? Is this the way it’s supposed to work? Or has a certain part of our government failed and its corporates are picking up the slack?
Jason: It’s a good question. I’m not an expert on government, but I think we haven’t seen the polarization of wealth and this type of massive ability for individuals and/or companies to acquire such a large percentage of the wealth in the world. Even the robber barons now look cute in terms of the scale of them. This is a whole different level of wealth accumulation, both on a personal basis, with people like Larry or Sergey or Mark Zuckerberg being worth maybe $20-30 billion (a very-hard-to-fathom number). But then professionally those companies like Apple are throwing off $140 billion in cash.
Governments do what they need to do, and back then, going to the moon and to space was something that seemed like we needed to do. I don’t know if it was in fact essential, but there are all types of dysfunction in government. These companies I think are led by super-ambitious people. I don’t know Larry and Sergey deeply. I know them casually. Once in a while, I’ll see them at an event and talk to them for five or ten minutes. I do think that there are certain individuals right now who are, for lack of a better word, bored at what they’ve accomplished at the incredibly old ages of 35, 40, or 45, and they feel like, “If I have another 40 years left on the planet, I might as well put them to good use and try to do interesting things.” So I do think they’re coming at it from a very good place, which is not about money – since they have more than they could ever spend – or not about power, but really about innovation and trying to do interesting things. I think it comes out from, in a large part, boredom and looking for a new challenge.
John: That’s really interesting. That’s a great point. You hear a lot negatively about the disparity in wealth. But the fact that these companies have so much in their war chests, it allows them to take those bigger shots.
As far as Apple, you’ve been outspoken about Tim Cook undershooting. Literally, they’re going into China with a cheap phone. That’s the kind of stuff that the street wants to see. It’s slow, steady growth. Are there any other reasons why you think they’re not doing more moonshots over there?
Jason: I think now that Steve Jobs could care less about what Wall Street thought. Certainly, Larry Page doesn’t care. I don’t think that Zuckerberg cares all that much, either. I do think Tim Cook is a well-adjusted person who actually is considered intelligent and effective at what he does, which by the way, is not what makes a great entrepreneur. What makes a great entrepreneur is someone who is unreasonable, driven, and who doesn’t care what other people think at any given point in time. I can assure you that whatever I’ve written about Google, Larry Page and Sergey have either not read it or quickly dismissed it. They don’t care what Jason Calacanis or anybody else has to say. They care about what they’re doing and how interesting it is.
I don’t think it’s necessarily any failure of Tim Cook. I think Tim Cook is probably doing a good job of executing on the existing road map that Apple has. The problem is that the world is changing very rapidly. Since the death of Steve Jobs, you have an acceleration in technological ambition and competition, so it’s just not enough to sit there and think, “If we release the watch and a TV, then we’ll create two more categories and we’ll have a lot more money.”
You do need to be inquisitive. Not buying Nest and letting Google buy it for $3 billion when you have $140 billion in the bank is a huge blunder by Apple, in my opinion. Maybe they have some amazing Apple products coming out, but they don’t want to set the precedent that somebody who previously worked at Apple can get paid to come back to Apple, who knows? Although they did that with Steve Jobs and they bought him a plane. It’s a little bit weird.
Also, Waze was an incredible start-up that Google bought for $1 billion. Although their frontend product for their Maps was a little bit cluttered and not the best UX experience, their data was the best in the world, and the community was the best in the world. How Apple, suffering from map inadequacies that were very public, didn’t just buy Waze for $1 billion and say, “Screw it. Let’s just throw one of our 140 chips that get replenished at the rate of dozens a year. Why don’t we just throw a chip at that?”
They don’t really know how to use their billion-dollar chips, and that’s a lesson I think the next person who runs Apple – I think Tim Cook probably has five or ten years of this – is going to need to look at Larry Page, Mark Zuckerberg, Elon Musk, and the people with true ambition and say, “The world is changing. These people are doing big things. We’re going to need to perhaps change the strategy a little bit,” because they don’t have Steve Jobs anymore. It’s one thing when you have Superman on your team, but when he’s no longer in the building, I think you do have to think about changing strategy a little bit.
John: As far as Google’s domination, you talked in the past about how Mahalo was subject to them as a partner, and as their whims change, it changes the environment and can crush small up-starts. How do you see these things? Do you see this like creating an iron grip and making it that much worse? What does the future look like because of this? Does it open up more opportunity or does it make it worse?
Jason: Now you get into the really challenging issues to think about. What’s for the best of society? What’s fair in terms of competition and entrepreneurship and an open economy? Certainly, Google is a monopoly or has monopolistic positions in a lot of places. They are very powerful. As a company, on a very pragmatic basis, they really don’t communicate well.
Having been partners with them for 15 years, I was told by Matt Cutts, who is the public face of Google and is 1000 times more out there than Larry Page or Sergey are, “We don’t have partners. It’s not how we do things.” But then I meet with people from Google all the time, like YouTube, and they say, “Hey, you’re such a great partner. Can we give you more money to do other projects?” The advertising team e-mailed me after Panda and said, “We wanted to talk about optimizing your hits on Mahalo.” I said, “Do you know that you got rid of 80% of our traffic? I had to lay off 75 hard-working Americans who lost their jobs in the content business, which is a really tough business to be in. You just whipsawed us and didn’t give us any warning or any chance to correct anything or any guidance.” They said, “Yeah, that’s a different group of people.” I said, “I know, but you all have Google on your business card. You’re all eating in the same cafeteria.”
This is where Google’s “nobody is in charge” is kind of a lie and a way to subvert any conversation with them and increase their dominance. It’s a big mistake because the animosity towards Google from both ends – the streets and the partners – is growing and growing and growing. When you don’t talk to your partners and you say things like Matt says, “We don’t have partners,” while other people in the company are calling me – even this week, I had an e-mail exchange with Google, who said, “Oh my God, Inside is so brilliant! Can we work with you to get you more downloads and help you spend money with us in our ad network? We’ll run a test with you.” I said, “I’m not really in the mood to work with Google right now because of how you guys have treated us.” They want us as a partner and then they don’t want us as a partner. It’s a long way of saying they’re becoming the most loved/hated company in the world.
Apple is just all love because they’re pretty up front with their partners. They say, “This is how we do things. You make a beautiful product. You use the IOS 7 designs. You’re all good. We may or may not feature you. It’s really based on the quality of your product. If you want to be in the Apple stores, we need you to have good packaging and a great consumer experience.” They could be a tough partner, but I think they’re a fair partner. I think Google is a tough partner, but they’re not a fair partner.
John: Is the content model for Launch Ticker what is actually driving Inside? How did that all evolve?
Jason: If Inside turns out to be a Unicorn, Google will wind up having inadvertently gotten me there. I was doing Maholo. We were the 140th largest site in the United States, 16-17 million unique, $10 million run rate on just Google AdSense alone (our partner at the time), and the how-to content was getting better and better. There were times when it was low quality and times when it was medium quality, but generally speaking, we were trending really well. We were spending more per piece than anybody else in the content space and we were just getting better and better at it, making 50,000 videos on YouTube with 20-30 million views a months and 2 million subscribers.
All that was humming along so well, but then we get hit with the Panda update, and I’m e-mailing everybody I know over there and they won’t talk to me and they won’t give me a straight story. Matt Cutts lied to my face, basically, which is why you hear this little bit of resentment towards him personally. He said, “We don’t have a penalty against you,” but we had 80% of our traffic gone. He said, “You don’t need to do anything.” I said, “Obviously I need to do something.”
All that angst led me to this really dark place where I was thinking, “What am I going to do here?” I have millions of dollars in the bank. I spent millions of dollars. I was laying people off. It was a very dark moment in my career, second only to the dot.com bust and 9/11, which were back-to-back events. I was sitting there in this dark period going, “God, what do I do?”
I talked to my board and did a lot of soul searching. I thought, “I think there are three things the future is going to be about: education, video, and news.” These are three areas that really need disruption and new products. So I started testing that. We did a deal with YouTube. They gave us over $1 million to create nine shows, three of which became breakout hits, which was the goal of the program. Even though they were breakout hits with great traffic, it was a bad return on investment because the money, with Google taking 45% of it, made it just impossible. I would give that a B- as a business proposition.
Then we did educational apps. We tested a lot of interesting apps and iBooks. They really got great response from the users who got them, but they cost $100,000-300,000 to make an app, and you wound up making $50,000-100,000 and unless you had a hit, it’s a really a very hard business. The app business is really growing down.
Then I looked at the news business and I tested the minimal viable product of the Launch Ticker, which was just someone reading over all the tech news and writing it as simply and clearly as possible for me in a Google doc. It literally cost $125/day to hire a writer and nothing for a Google doc. Boy, was it compelling. I could tell from the first day I read it that it was saving me a lot of time and I loved it. That quickly grew to 5000-6000 e-mail subscribers. Smart people were looking at it saying, “This is the future.” I thought, “Hmm. Interesting. Smart people are getting it.”
I had gotten the Inside.com domain name, which is another story. I said, “Boy, this is it. If I do Inside.com/bitcoin, Inside.com/coffee, Inside.com/sochiolympics, Inside.com/woodyallen or whatever it is of the topics that are in the news, or things that people are passionate about, like Inside.com/comicbooks, and we can figure out a way to deliver it to them mobile-ly, it’s going to be a huge win.” We came up with this concept of updates and Pandora for news and we started building it. The reaction has been amazing. Without getting into too many of the numbers, people who use the product are really into it.
I basically did three tests. One of them really appealed to me as an entrepreneur. There was a founder-market fit, founder-product fit. It also happened to have a product-market fit. You really need those two things when you’re an entrepreneur. You have to love the product you’re building and the market has to love your product. If you can get those three things in a nice little triangle, where the founder loves the product, the market loves the product, and the founder loves the market, you get that little triangle going, then you’re in a good place.
I feel like Inside is just destined to be the number one news site and mobile app in the world. I think it will be as important as or more important than CNN. I know that’s a really bold, crazy statement, but it’s obvious to me that somebody has to reinvent the news, and CNN is just so saddled with the past. The New York Times is so saddled with the past. We can start fresh. It’s a huge opportunity. That doesn’t mean it’s still not a 1-3% chance we do that, but I like those odds. One percent chance of making something as important as the CNN or the New York Times – I’ll take those odds any day.
John: That’s definitely where you want to be. What about the players – everybody who dominated the news for the past three or four years? There’s the Huffington Post and Slate and all these people who have fallen prey to the click. They’d rather put something scandalous up there to drive the traffic than actually report the news. Is that at the core? Obviously, quality content is what you’re all about. Do you fear those other guys, or do you fear an upstart over them?
Jason: I wouldn’t be too worried about the big players because they have a legacy business. The New York Times has maybe 1000 journalists they need to feed. They need to pay homage to the history and keep it going. You can appreciate all of that.
But then you have the Business Insiders, and the Buzzfeeds, and the Upworthys, who I would put into the category generally of a mixed bag. They have high and low moments, so I call them “high and low.” It’s their strategy to say, “You will have a brilliant story on Buzzfeed or Business Insider.” Nicholas Carlson comes to mind with the Marissa profile, or Alyson with the Travis Kalanick profile from Uber. Buzzfeed also has some great stuff once in a while. But then they surround it with these pop culture slideshows and gimmicky headlines, like, “You’ll never believe the three things that Marissa Mayer did to be successful in kindergarten.” They say, “We know that people love kindergarten. We know they love Marissa. We know they love secrets, so let’s just do that all day long, every day.” That kind of stuff feels ephemeral and vapid and all those kinds of things, but it works. Upworthy works.
I look at those kinds of techniques, but to me, those gimmicky techniques feel just like SEO. I fell prey to that strategy as well. It can build a big rush of traffic, but it’s like hitting a crack pipe during a marathon – it’s going to get you through the next mile, but it’s going to kill you in the couple of miles after that.
Upworthy will be penalized. It will be blocked by Facebook, or they’ll be charged by Facebook and there’s going to be a huge Upworthy crash. Buzzfeed and Business Insider – who knows? Maybe they’ll be able to push into the legitimate stuff and strike a balance. You live by the gun, you die by the gun, and I think they’re a little bit too much on that crack pipe of Facebook and it’s not going to end well. Once Facebook decides, “Hmm, you’re making money off of us? We’ll cut you off and you pay us now,” which is what they did to Zynga or any other game company. They did it to people building Facebook pages. People were building Facebook pages and Facebook said, “Build up all your friends and family and get them all to like your profile page and your podcast.” Then all of a sudden, you wake up one day after you’ve invested hours and thousands or tens of thousands of dollars, and Facebook says, “You want to reach those ten thousand people who follow you? Pay. You can reach 300 of them, but to get the other 7700 of your 8000, you have to pay us.”
I think those things are part of the reason why Inside is speaking to a small number of people in a very big way. They’re tired of the cotton candy. Cotton candy is a delicious thing, but it’s very hard to eat a whole serving of cotton candy. When you get to the end, you’re disgusted. Nobody ever orders a second helping of cotton candy. The first bite is “Oh my God, delish.”
John: Do you see this new Facebook Paper coming out as a threat? Is it any good?
Jason: I think it’ll be as successful as their effort to take on Quora or Snapchat or Groupon. When a company starts to knock off other people’s innovations, like Google’s Google Video versus YouTube, the public is savvy to that and they don’t embrace it – maybe not the entire public but the ones who matter, those early adopters.
When the early adopters saw Poke, they were saying, “You ripped off Snapchat. I’m not interested.” When the YouTube community saw Google to Google video, they thought, “That’s Google. We’re not interested.” You have to be careful with that strategy. I think it’s a very beautiful homage to Flipboard, but if anybody looks at it, it’s pretty clear that they just literally stole Flipboard’s innovations, from the section functionality to flipping through stories. It’s just a knockoff. A good one though. If it was on Canal Street or in the Fendi store, you wouldn’t know, so I think that Facebook is awesome at knocking stuff off. They did it with Snapchat and Poke. Poke was probably even a better product in some ways, but you can only rip people off and get so far. 95 times out of 100, it just results in nothing, so I think that’s what we’ll see here.
I think there’s maybe a 5% chance it will work. They’re not going to put the effort and the care into it that Flipboard has. They’re certainly not going to be able to retain top employees and top talent to produce rip-offs. That’s the other thing. Can you imagine? You’re at Facebook and Zuckerberg comes down and says, “We can’t buy Snapchat, so make me a pixel-by-pixel copy of it,” or, “We can’t buy Flipboard, so make me a knockoff.” He actually famously, according to Snapchat folks, e-mailed them about Poke after they wouldn’t sell. There are two sides to every story, but that’s a little bit of taunting. I think that kind of childish taunting and copying is probably not a great long-term strategy for success.
That’s the last thing I worry about: Facebook’s efforts to copy stuff. I always look for some other entrepreneur who really understands and is thinking from zero about what the experience should be.
John: Yeah, I can see that. The early adopters pass up on it and you don’t get that same type of starting hit. How about the Launch Festival you have coming up February 24-26th in San Francisco? Are you guys ready to roll with that? Is it going to be another big year?
Jason: Yeah, I just did the rehearsals. This is the seventh year I’ll be doing a festival. The first three years I did with my old friend, Mike Arrington, at TechCrunch40 and 50. For the last three years, I’ve done it on my own as Launch Festival. This will be the seventh year I’ve done a start-up conference like this, and the companies are amazing.
They’re all coming into their first rehearsal and I give them scores. Typically the scores in the first rehearsal are 4s,5s, 6s, and 7s. Once in a while, there’s an 8. This time there was all 7s and 8s and 8.5s. In the first rehearsal, to have people doing such a good job is extraordinary.
I do that event as a break-even or loss every year, but I try to make it bigger and better every year. This year, we’ve got well over 7000 people already RSVP-ing. Last year, we had 6000, and we’re still 20 days out, so I would guess that we will hit 8000, 9000, or even 10,000 people, making it the largest start-up conference in the world, by far – and certainly the largest in the United States.
I do it for the joy of entrepreneurship and I have a little Angel investing fund. I’ve invested in 50 companies. Over the next three years, I’ll invest in 50 more, so I’ll have 100 investments. My visa says the people who come to the event, as well as the judges and people who participate, are my deal flow, so for those companies I see in rehearsal, I can see the entrepreneur and how they take the feedback during rehearsal and how they respond to it, and if I see them really improving the product and doing a great job in the four weeks of rehearsal, which is probably 30% of Y Combinator or TechStars. We don’t get any equity. It feels like that to them. If they do a really good job then I’ll probably Angel invest in them, which I’ve done in the past years.
John: That’s great. Jason Calacanis from This Week in Startups and everywhere else. It seems like you’re everywhere these days. Thanks for stopping and talking to us. Is there anything else you want to hit on on your way out the door?
Jason: No, other than that podcasting is a great thing. I always love talking to podcasters. You can follow me @Jason. You can follow Inside @Inside, and you can follow Launch @Launch, all those great names on Twitter.
John: That sounds great. Thanks again. We’ll catch up with you next week. Until then, enjoy the coffee.
John: This is your second book. The first one ran like wildfire. Take us from when we talked to you last. The book did well. You did the speaking thing. When did you realize you needed to write something else and what did you come up with for a big idea?
Mitch: “Six Pixels” came out in 2009 (I wrote it in 2008) and I really felt it was a book where I was explaining how, as a small agency – a very small shop under a handful of people – we leveraged these ways in which we connect. I don’t want to lump it all under social media because I didn’t think “Six Pixels” was just a social media book, but how we leveraged it to really build attention, build clients, and use it as a springboard to what we can do, which is very different from the way traditionally you would think you would grow an agency and market it.
I was already latched onto the blogging bug, and for sure, the podcasting bug had bit hard, too. You go through the process and wonder, “Do I need to really write another book? I’m still blogging every day. I’m podcasting every week. I write for the Harvard Business Review one week, and the opposite week I write for Huffington Post. Magazine offers and newspaper stuff.” Life is sort of good.
I just came to the point in my life, professionally, where I realized it was sort of like, “What now?” moment. What now? So what? So everyone has a mobile phone. So everyone is creating videos and texts and images and audio and Twitter – but so what? What now? What do we do as a business to truly make this stuff matter, make it count, and not do the stuff we used to do in this very, very new and different channel?
In my conversations with C-level executives, in my conversations with marketing practitioners, I do about 60-70 speaking events every single year, it became abundantly clear to me that there were several things that have happened that have fundamentally changed business forever, and yet most brands were doing nothing about it.
I looked at it and kept modeling it and having the conversations and the speeches I was doing, and it really came into these five areas. To me, it was about: how do you reboot business? To me, rebooting business is about these five areas in terms of today.
But then I started realizing, what does that mean to me and you? You have to still get up and go to work every day. You have to still do what you have to do. Does this make you employable in the next five years? How do you stay employable in the next five years?
That became the catalyst for the second part of the book, which is called, “Reboot You.” I call them triggers, but it’s posture you need to have to make sure that you, in and of yourself, are a viable entity within this very, very different business system. When those two roles collided, John, it was the classic story. I was in the shower when I had the epiphany. It was my holiday break and I was like, “Wow, this is it.”
I have to tell you, from book proposal to speaking to my agent to all that, it was literally a function of a couple of weeks. I always had the title “Ctrl-Alt-Delete” in my brain as a potential for the second book, but there was this moment of crystallization. It really is a labor of love. It’s not a book where I’m talking about how I did something or why you should, too. It was more an exploratory book in these five regions and these different triggers, and for me, it was such a pleasure to pull it together in a much richer depth than I can go into on my blog.
John: The thing that got me is, right out of the gate, you’re talking about sounding the alarm – the classic look to your left and right, and one of those guys aren’t going to be there in a couple years. It could be you, too, if you don’t have your act together. Do you really think it’s that severe – the shift that we’re facing that we’ve got in front of us now with all these tools coming into bear?
Mitch: Whenever you put a provocation out like that, most people are like, “Well, hell yeah!” I’m Canadian, so I think, “Oh, I don’t know. It sort of makes me edgy.” It’s a line that I have been using on audiences for a while. For me, the real reason why I started with that is because I think about my agency – Twist Image – we started in 2000 and I joined in 2002, so I’ve been at it now for eleven years just here, not talking about the fact that I got into digital in 1993, so it’s been like 20 years of being in digital.
I think about how we have evolved, what services we offer and how we connect brands. We work with B2B, B2C, small impulse buys, we work with products that take long sales cycles; and you come to realize that I’m actually employing people currently in job titles that didn’t exist when I started this shop in departments that didn’t exist in the industry. It’s this whole new wave of vocation that has fundamentally changed.
Then I meet with my peers who are in, let’s say, traditional media and they’re not really struggling in terms of managing growth. They’re struggling and figuring out how to cut things so it looks like there’s revenue there. And yes, I do think the foundational digitization of society is profound and I think it’s even most profound now because we’ve come past this shiny object thing.
We’re at a point where technology has removed the technology from technology. Think about the iPad; think about a smartphone. If you pivot on that idea, you start realizing that these are real shifts that have happened – they’ve already taken place – and we need to act. I do think that even five years might be a little long just based off of the exponential growth curve that we’re in.
John: Yeah, and how it comes around. I like the way you’ve framed that as far as pulling the complexity out of the technology. There’s a classic Bill Gates line saying we always overestimate these technologies in the first year, but then we underestimate ten years from now what they’re going to do because they do finally deliver on all the hype and promise as time goes by.
Mitch: The squishing of the time has also been much more compressed. Even when I first spoke about it in“Six Pixels of Separation,” I talked about that compression of how a message goes from ideation to publishing. Blogging fundamentally changed that. It became instant. Now you think about that just in terms of the world. I have to always remind people three-and-a-half years ago, we didn’t have an iPad. It’s not a long time.
John: Literally, you’re talking about not even 1,000 days since that’s come up and around. Yet another angle that I like a lot is you talk about “no direct relationships, no future”. I like that idea because so often people have thought about these new channels and using them to promote and push, but it’s kind of flipping it around and saying, “No, you’re not getting it. If you don’t get those relationships, you’re at the end of the road.” Could you talk a little bit more about that?
Mitch: Anybody can sell anybody now. You and I grew up in a day and age where if you bought a pair of Sony headphones, you did not buy it at the Sony store. You probably bought it Target, Wal-Mart, or wherever. If you were mad about it, you just went back to the store and complained. It never really filtered up to Sony. On the occasional poor customer issue, you would write a letter to them and they would maybe respond or maybe pretend like they never got the mail and it would wind up in someone’s file cabinet and that was the end of it.
If you think about what that relationship from the consumer perspective is today, it’s very, very different. Sony, Target, Wal-Mart – “like us on Facebook, follow us and do all this stuff.” This is a lot of marketing messaging. Just think about that food chain. Sony is telling me to like them on Facebook and Target is telling me to like them on Facebook, and it’s happening on Facebook.
Who owns the direct relationship? Is it Facebook that owns the direct relationship with Mitch Joel? Is it Target? Is it Sony? I try and make the argument that you can pick one if you want, John, but it doesn’t matter. Every single one is trying to have the direct relationship, because that’s what we have at the end of the day. All we have as a brand is that powerful direct relationship.
You might say, “No kidding. That’s not a new movement.” I would argue it is a new movement when you look at the food chain I’ve just described. Before, it was: you’re in the fight with the competitor for the direct relationship. Now if you look at your food chain from your product, you’re actually in a battle with each and every person on the food chain because they’re telling you to like them, follow them, and do all this stuff as well. Everybody’s hustling into that direct relationship.
I do think the perspective that most brands bring to that component of the relationship, they’re sorely missing and they’re letting that relationship go to not a competitor, but someone else in the actual food chain.
John: The whole section that talks about the 7 Steps of Utilitarian Marketing, tell us a little bit more about that. I like the way that all fit together.
Mitch: I found myself one day in New York City needing a bathroom really badly, turning on my iPhone and seeing the app “Sit or Squat.” You turn this app on and it knows where you are by GPS location and it tells you which are the cleanest bathrooms in the closest vicinity, literally rated from 1-5 stars. It’s based off of a wiki platform. Anybody can edit it. They can add as many stars as they want. They can add comments. They can add new bathrooms and request a bathroom be removed. It’s this amazing app brought to you by the good people at Charmin.
You tend to think about if Charmin was doing mobile, it would be, “Here are mobile coupons,” and “Here’s are double-quilted thing,” or “It’s a game with the bears from the TV and you get to pick the little piece of toilet paper off their butts,” or whatever it might be. It’s ridiculous that in a day and age where anybody can create anything and send it to consumers that what we’re actually doing is mostly bad advertising or bad iterations of advertising when you can create utility.
I think “Sit or Squat” was one of those bellwether examples where I realized it could be complementary. It could be an extension of a brand narrative. It could tell a bigger and more profound story and connect people more to the brand by providing them with something they would like to use. We live in a world where the home screen of our phone is the new real estate. It’s the same reason why a big store would open up on a specific corner and a specific city. They’re looking for foot traffic. Well, that new real estate – that new foot traffic – is the home screen of the smartphone.
People recoil and think, “Well, what is it, one-quarter of all branded apps get downloaded, used once and never again?” All that data is wrong because they’re talking about apps that suck. You and I always use apps that provide utility – that added value – and I don’t know how many brands have taken the step back to say beyond the advertising schema that you can have in these platforms and channels, “Why don’t we actually create something that is of value?”
Pushing that further to the blackest of black belts, it would be, “Could you get it to the point where somebody would pay for it because it’s so valuable and useful to them?” I do think we’re at this amazing moment in the history of marketing and communications and the history of business where you can actually do that without traditional gatekeepers. That is massive.
I understand why brands haven’t done it, because maybe they haven’t been illuminated to the idea, but what an amazing opportunity for anyone.
John: You have a whole chapter that talks about sex with data and nailing down the linear. Aside from just being provocative, it is all about the data. Of course we’ve seen the big data tidal wave wash over us here. What’s your take on this? What do you see us doing with all this data in front of us now?
Mitch: I was talking recently, and I know you present as well, and sometimes when you speak you say something and it comes out of your mouth and you don’t know where it came from. Sometimes you wish you could grab it back and shove it back down your throat. There are other moments where you’re like, “Oh, that was funny; I should remember it.”
I remember saying something along the lines of, “I think everybody is overly-excited about big data and that’s really interesting in a world where most people suck at small data.”Where I was going with that is we have a lot of linear information that we take – e-mail addresses, advertising, direct marketing, etc. We have this new world on the right-hand side which is that circular gate. It’s the semantics stuff. It’s not data that you’re really capturing, but it’s data that individual consumer are willfully putting out there (Facebook, Twitter, YouTube, blogs, etc.).
Looking at that and thinking about our world of dashboards, and everybody in data analytics is all excited about dashboards, I say beyond dashboards, what are with really talking about here? I think what we’re talking about is the intersection of that linear data going into that circular data. That’s where the good stuff happens. That’s where the sex happens.
Suddenly it’s not just about demographics and psychographics that are helping you as a brand connect information in a way that would be more relevant to music consumer, but suddenly you have a more 360-degree perspective of not just what Mitch Joel has done, but who he is. When you think about that at a macro level, you can just imagine a world where information, advertising, sharing, building relationships becomes that much more powerful.
When I say you can imagine a world, I say that because you can do it today – you can do it right now – it’s just brands don’t have the intestinal fortitude to do it. They’re not putting the time and effort into figuring out what it takes to make that happen.
When I talk like that, I realize everybody says, “Well, that sounds creepy. It sounds like an invasion of privacy.” I’m the immediate past chairman of the Board of Directors of the Canadian Marketing Association. I sat on the board of the Interactive Advertising Bureau. Privacy is a massive issue for me. Privacy is a massive issue for me because a lot of marketers screwed it up to the point where we need to have lawyers involved and government involved. That’s crazy.
I believe that what I see when I talk about sex with data is the ability to do things for consumers that are not breaching any form of privacy, but at the same time, creating a level of personalization that makes them just want it more.
Case in point would be Amazon. It’s so hyper-personalized that if you were to see Amazon as a brand new customer, it would be very overwhelming and probably very boring to you. But they do that personalization so well. They leverage that linear data with what they know about you in terms of your personal habits that it makes you yearn for more of it. We don’t ever think, “Amazon is really breaching my privacy.” We think, “Wow, Amazon. Keep at it, because I’m buying more stuff and I like this.”
John: You said the first chapter of the book talks about the corporate approach – things the whole organization has to worry about. But in part two, you get into the more personal level about what you personally need to do for your career to keep things moving. One thing you talk about is rebooting yourself and finding your blend, if you could tell us about that.
Mitch: Blend is a really interesting concept that I wish I had created. It’s one of those things that you realize you’re doing, and then someone gives you a name for it. I’m at this really cool event and I get a chance to be introduced to Patrick Pichette, who is the CFO of a little company called Google. Can you imagine meeting the CFO of Google, by the way? What a gig.
John: Yeah, tough life!
Mitch: I don’t even know if you remember, in the news they had that thing where – I think it was for Google+ or something – where they rented a wave machine so people can surf at mountain-view. He was telling me, “I’ve got this purchase order” I asked, “What is this for?”
“Oh, we’re renting an ocean to go wave surfing.” And I guess that’s what happens when you have billions of dollars in a war chest.
I’m standing with Patrick and he happened to be here in Montreal. Patrick is a former Montrealer who was working for Bell Company, most people here know it. There were a couple of his old Bell buddies who were at this event. One of the guys is standing there next to him and I’m just a fly on the wall. They say to him, “Hey, Patrick, how’s your work-life balance now?”
It was awesome. Patrick looks this guy right in the eye – doesn’t miss a beat – and goes, “You don’t take this job for work-life balance.”
You would think most people would say, “Oh, I get the weekends,” or whatever. You don’t take the CFO gig at Google if you want work-life balance. You’re all in. I remember thinking it’s those super-execs who have great punch lines.
We sit down for dinner, and again, just magic of magic, Patrick sits right next to me, which is awesome, so I get to chat him up. I said, “I was really taken by your comment about work-life balance.” He said, “When you work as people like us work – and I include you and myself – in this connected world with e-mail and smartphones, this idea that work falls outside of life is somewhat erroneous.”
It’s so true. I’m really dedicated to the growth of Twist Image. I’m dedicated to the content I create and the speeches I give and all those things. At the same time, I don’t like putting it outside of life. I think it’s life. You have 24 hours in a day and you’re making it work.
He talked about this notion of blend, this idea that he had this crazy meeting in London, so he flew his wife in and they spent three days in London, but then he was gone for another two days or down in the office; then he did something with his kids. I’m not trying to make it sound like he’s neglecting his kids and he doesn’t come home for supper with his family – that’s not the scenario. It was more of him constructing his day around the blend and flow.
I don’t know about you, but I have found there are days where I’m looking at my computer and my agenda and I close the computer and go play with the kids in the park. I can jump back online at 9:00pm and catch up on the extra e-mails or whatever it is, or I can have this call on the way home in the car. We have very different lives.
I always worry, “Oh, dear Lord, I’m a workaholic and I’m going to have a heart attack.” That whole thing where I stress myself out about the fact that I’m not stressed out. I really started looking at my life realizing that I have a really healthy blend. Blend, to me, in terms of how I look at life is it’s a stool and the stool has three legs. One leg is my family and friends; one leg is my professional work; and the third one is my community work. Like any proper stool, if you don’t have the exact balance in all three, it will tip over.
When I have those moments where I feel it’s tipping over, I look to the three and I figure out: where is the blend missing?
John: You’re talking about the way the market is changing, things are ramping up and an employee really needs to take more of a startup mindset, if you could talk about the components of that and how that protects you, makes you future-proof.
Mitch: I know both you and I both have a huge love for all things Seth Godin. Whenever I’m doing something in work – and I consider a lot of my work very, very entrepreneurial – I think about that aphorism he always shares, which is, “The riskiest thing you can do is be safe, and the safest thing you can do is be risky.”
It’s a nice thing to say. It’s not necessarily an easy thing to do when you’re looking at the construct of what your day-to-day life is – “I’ve got to pay rent, make the mortgage, take care of family and all that sort of stuff.”
What is it about the sort of work that we do? You’ve always heard terms like be an entrepreneur, be an intrapreneur, etc. But there has been this startup movement that has come into the fray. We’ve had startups for a long time, but I think now because technology has become that much more easy, obvious and intuitive for people to at least try their own thing, I was wondering, what would happen if we brought that type of startup spirit?
If we looked at the things that are so beautifully written in “The Lean Startup” by Eric Ries, if we actually took that mentality – that startup mentality – of testing, being iterative, learning, optimizing and applied it, one, to the work we do, and two, to us as individuals, what would it look like?
Not a day doesn’t go by that I don’t try and do one little test. It might just be a simple e-mail question to someone or whatever it might be, but the more and more I get into that idea of being that startup, – that constant iterative place – the more comfortable it makes me.
I think people who even come to work for our agency are somewhat surprised being 100+ people for 13 years that we really have that startup mentality, not just in the physical way we look and operate, but in just how we think. It’s always about we’re the underdogs and we have to really go for it. I think it’s a valuable lesson to think about in terms of your own personal development.
John: As you’ve gone through the process of writing things – you’ve put this all together – has it changed the way you’re doing business daily now? You obviously had the idea when you began. By the time you finished, had it changed the direction you were moving in? Has it done anything different for you now today?
Mitch: In terms of the whole book, you mean?
John: A lot of times, the writing process makes things gel for you. By the time you’re done, you look at the idea differently than when you started. Has it metamorphosed at all or were you dead on from day one?
Mitch: It’s a weird world when you’re between my two ears. During the writing process of the book – and it took a significant amount of time – I didn’t miss a blog post and I didn’t miss a podcast. You can imagine that if I blog every single day (365 posts a year, and take away one a week because I do a podcast on Sunday), I’m accumulating books and books as the book is being written. I think as you’re writing the book, other things that fall off or become inspiration lead into blog posts, articles, or what have you. With that, I’ve been talking about the concepts live in front of an audience for about a year, because you want to test the content and see if it resonates or not.
What I’ve learned is the book is the place where I go to really expand upon a lot of those ideas, whether they be in a blog post or an article or speaking, and then it takes you down other avenues and it becomes this beginning, middle and end. I know that the book retains that.
But definitely, if I look back to the fact that I finished writing it in May of last year and did the final edits up until January/February of 2013, I was updating things and moving things.
I think about one of the anchor stories that I tell in the beginning of the book, which is about Marco Arment, who is the former dude from Tumblr who went on to start Instapaper. This guy starts this business. He’s running it out of his appointment in New York. It’s worth millions and millions of dollars and nobody even knows because he’s self-funded, he did it by himself, and it’s this massive success. It got sold to Betaworks the other week.
You look at that and say, “Isn’t that the problem? How do you write a book and it’s already out of date?” I was thinking about it and it actually completely validates everything I’m talking about in the book. What does that tell you? It tells you that you can have a multi-million dollar exit in the time a book is written. That is complete purgatory. That is complete mode for reboot. That is a complete model for “Ctrl+Alt+Delete.”
It’s interesting to see how the dynamics change for sure, but the five movements are very, very real. How we’re bringing it to work is still very, very real. My real love is now that it’s written and it’s coming out, I can just really expand on some of it even more if I want – or update it – in the platforms I have.
It’s sort of an organic thing. The book can’t be the only thing. I think if anyone reads it and likes it, they’ll do what they did last time, which is latch onto the podcast, listen to this, follow me on Twitter, read my columns in HBR and hopefully what they’ll do is come with me on this journey – because it’s a journey. All of anything I ever do is a function of me working out what is going on in my brain in terms of trying to come to answer that has a business solution to it. It’s playing. I think that the book is a great anchor in terms of bringing together a much deeper breadth and depth to that thinking.
John: That’s good. Let’s talk about more entertaining stuff as we wind down. I have on my list comparing Iron Man 3 versus Google Glass. Which do you fall under if you had to pick?
Mitch: That’s crazy, John, that you say that. I was in Toronto for two days working and I had finished a client dinner. It was about 8:00pm. On the way to my hotel from my office, there was actually one of those Megaplex movie things. I was walking by and I thought, “I’m going to see Iron Man 3,” and I walked in and it was so busy. I was like, “I can’t do it. I’ll come when it’s quieter,” and I left. So, I haven’t seen Iron Man 3.
But I will tell you that I have used Google Glass and it is very, very transformative. All of the discourse I’m seeing online, I have to say, it’s just fundamentally wrong. The first thing is everybody you’re reading about Google Glass right now are the exact same things we said about cell phones: “You look like such an idiot when you talk on the phone in a restaurant,” “It’s so rude that you’re walking down the street talking,” “I can’t believe you’re talking in your car.” We said all these exact same things.
What people don’t get about it – and the transformative part about it – is this. Every time you access your keyboard, your computer, it’s about your hands and your fingers and touching and moving and your smartphones and all this. Think about moving all of that interaction that you have to your eyes for motion and your voice for control. That’s the profoundness of Google Glass. It’s not perfect. It’s going to be refined. But that alleviation of stumbling into your pocket, pulling something out, touching it and all of that just going away, and suddenly, the world is very clear.
There is a screen in the top-right corner. You can’t see it unless you look at the screen, so it doesn’t obstruct any view. It’s on a heads-up display. The ability to use your voice and your eyes to engage in that content is absolutely as enlightening as it was the first time I used a web browser.
John: That’s a ringing endorsement then. We’ll put you on the side of being transformative and the next big thing.
Mitch: On the beta list.
John: How about if folks want to learn more about the book or more about you? We hit a bunch of the points, but where do you suggest they purchase the book? We don’t want to go through the regular channels if you’ve got someplace special they can pick it up.
Mitch: It’s a massive publisher. I’m with Grand Central Publishing, which is part of Hachette Book Group. They’re the largest book publisher in the world. Anywhere you purchase books whether you do it in physical, digital or audio, it should be available. Hopefully you will buy many copious copies for yourself and everyone you know, because I have children that need to eat.
John: That sounds good. We’ll have to come up with a package deal. Maybe we can throw Chris and I’s book in the fire and make it a 3-for-one deal.
Mitch: Let’s do it.
John: Mitch Joel, thanks for stopping by. We appreciate having you on the show. Any last exit comments before we wrap up?
Mitch: I love you guys. You know that. It’s one of those weird things where we don’t talk often enough, but I think about you guys daily – both you and Chris (or as I call him, Ninja).
It’s amazing. I think back to: is this stuff real and does it make sense? People talk about the web all the time and Twitter. Is it useful? I think about you guys a lot because we met in Boston coming up to seven or eight years ago – real relationships, real interactions, real people, family stuff, friend stuff. I think people dismiss that. They dismiss the value of it and they don’t necessarily take into all the great things this digital stuff does. I would have never met you had it not been for podcasting. I’m all for podcasting.
John: That sounds great. It’s the same here. It’s been fun to be able to watch you before the first book, before everything started. The whole PodCamp thing was crazy. David Meerman Scott got things going there.
Mitch: You can go through it. It’s Chris Brogan, Julien Smith, John Wall, Chris Penn, David Meerman Scott. We could literally keep going for days on this. It’s insane. Pulver.
John: Yeah, Jeff Pulver. And then Rocketboom was when they were on fire.
Mitch: Scott Monty, Joe Jaffe.
John: C.C. Chapman. You could really go on and on.
Mitch: Hey, what about our friends at GALACTICAST? Same thing. All PodCamp.
John: I’ve seen those guys in Pittsburgh at PodCamp. iJustine was down there for the first one. It was crazy, everybody on that wave. We definitely have moved on to other stuff, too, but it is great that everybody has been able to stay in touch and being able to work on different projects now and keep things going.
Mitch: Life is good.
John: That will do it for today. Thanks, Mitch. And to everybody out there, enjoy the coffee.
A couple of months ago Mike Proulx from Hill Holliday asked if I’d like to be on a panel talking about the future of marketing. Since it was an evening session when my family was out of town it was a great excuse to get into Boston and talk with people about what’s coming next. It was great to be part of the event and it went off really well thanks to Mike (and I think D.J. Capobianco and his team were very busy behind the scenes).
There are two pieces of good news about this – one is that Steve Garfield was streaming the event so I’ve got the video here (nice to get a break from writing now and then). The other is that it had 7 views before I told my family about it, so that’s a big deal.
The other panelists were great, I’ll post those segments when I need an excuse not to write…
The other thing that struck me about this post was the number of worthless trackbacks. I’ve started to look at blogs along a spectrum where the degree of interactivity is inversely related to the popularity of the author/blog owner (which, for the larger ones may be corporations or the former dead tree vendors Mr. Shirky is talking about).
The blog starts with everything open, although by default now you have to have some spam protection on. If you reach critical mass you start to have comments that deride you personally, are generally crude, or caricatures of humanity, usually submitted anonymously, and so the comments get shut off in favor of trackbacks.
The acceleration continues and then the trackbacks get too spammy so they have to go too.
The underlying issue is that it doesn’t scale as well when you hit explosive growth. Something I need to think about some more…
This will only be of interest to the most hardcore video geeks (perhaps only half of the readers here). I just upgraded to the latest version of TivoToGo – the program that gets TV shows off my TiVo and on to my PC, and then converts them to a format that I can watch on my PSP (or iPod, but I don’t do that anymore) and it’s all legal. Or at least, I’m using a tool I bought from TiVo not downloaded from some weird server in some Eastern Bloc country.
The interesting thing is that version 2.7 uses Bonjour, some software that is also used in iTunes to detect what media players are out on your network.
Apple and TiVo seems like a really nice fit, don’t you think?
This morning I attended a Seth Godin event, a presentation on his new book Tribes (please click to offset my massive new media experiment debt). I took the Acela down from Boston the night before and had a chance to crash in Hell’s Kitchen, and then head over for the morning session at the New York Times Center. I brought along the camera and audio rig, I’ve found that to be enough, if I try to shoot video I end up being cameraman and not actually paying attention to what’s going on. I had hoped to have my new 50mm 1.4 lens that I had ordered last week, not realizing that we’re in the middle of a holiday (a week, not a day) and I might get my lens before 2009. Good thing I coughed up for 2 day shipping. I digress. Let’s talk tribes…
I was surprised to see so many tribes that I have been fortunate enough to run with. He lead off talking about Joel Spolsky (aka Joel on Software), we threw a cocktail reception after his most recent Business of Software conference in Boston. He had a slide from Gnomedex showing off Chris’ geek tribe, Gary V got a shout out (who is sitting on a panel today in Arizona with my Marketing Over Coffee co-host Christopher Penn).
Laura Fitton scored some prime real estate, she’s been doing very well even in spite of her attending the Scott Monty Roast.
It was an entertaining presentation, and in his classic style it’s very thought provoking. The good news is that I also recorded the session and will be posting it over in the Marketing Over Coffee feed (presuming that it is of decent quality, I haven’t checked it out yet).
So I finally wrapped up the wedding tour (link to absurd dancing photos), and came down with the flu this weekend. After sleeping most of the day Sunday I was back in the game for The Beancast and back to work to close out the quarter.
It’s interesting that the Bailout was shot down, talk about Marketing in Action. For my opinion on the bailout, please refer to this article in Time Magazine.
Remember to follow the money to identify the things that people need you to believe:
The Government can move the economy. That $700 billion (less than a 1 day loss in the market) is enough to move the entire economy. Controlling the economy is much like controlling the weather, if anyone says they can do it, they are lying.
Â What derivatives die, the 4 Horsemen appear, signalling Armaggeddon. The Time article does a good job at explaining this – the bailout is for some Frankenstein financial instruments – think of it as insurance policies betting on on-time payments from a bunch of people who bought houses that they can not afford, have no savings and have about 10k in credit card debt. If these explode, only the people who thought this was a good idea to get burned (along with the 3 people below them in pyramid scam of resellingÂ this trash). Clarification – we do have another problem though – this balloon filled with crap is so huge and has been treated like cold hard cash, if it pops there’s enough to get some on everyone. Investing in duct tape and payouts to keep the balloon together is no long-term plan.
Financial Institutions are Too Important to be allowed to fail. Detroit can be decimated, tech bubbles can come and go, manufacturing can be wiped out, big box retailers come and go but there’s the big 3: Banks, Agriculture and Airlines – if these aren’t socialized there will be rioting in the streets and we’ll be selling apples.
Being an elected official is a full time career – When’s the last time you heard someone running for office talk about a duty to serve? Did I actually hear the word “Rule” during the debate last week? I’ll stack Politician on the shelf right next to Journalist in the “Professions of Make-Believe”.
And then there’s a few ideas behind the curtain that people don’t want you to ask:
Where did a bailout package that has Main Street bailing out Wall St. come from? Can someone show my why this isn’t elected officials sucking up to the rich?
Why are their no financial conservatives left?Â Both Presidential Candidates see Legislative spending of citizen’s tax dollars as the solution. As a cranky old man I credit this to budget=power and since we’re dealing with career politicians there’s no incentive not to spend tax dollars.
My friend Steve has been living in LA for more than 10 years and we’ve talked about how difficult it is to buy a home there. The thought of him having to pay tax dollars to bail out some jackasses speculating on crummy mortgages makes me sick. And oh yeah,Â the homeowners out of their financial league still lose their homes, they are not part of the bailout.
Before I return to our regularly scheduled marketing programming I’d like to mention Rep. Ed Markey and staff who were unable to tell me his position on Monday’s vote and even took my email address and said they’d get back to me, no need to bother now, your Aye vote speaks for itself. VoteSmart says this is an election year for you.
I’ll also note Sen. John Kerry’s office that wasn’t answering the phone, and my fax was refused, but I can give him some credit, perhaps things were just too busy today and at least he’s sharp enough to put his opinion up on his blog for everyone to read. In contrast, Rep. Markey’s website’s “Recent Events” section has him being named “Irish Man of the Year” back on March 12th.
The last of my representatives is Sen. Kennedy, regardless of political battles and opinions, I wish him the best with his health.
I can’t wait for election season to pass. Here’s the Beancast if you need some marketing to counteract the politics:
I keep an eye on what Justin is working on. He’s not just talking about how media is changing, he is getting his hands dirty, watching it change around him. The beauty of this is that he may see some fame in the next few years and some speaking gigs, but because of the hands-on experience he has it wouldn’t surprise me to see him in 10 years working on whatever passes for big time Television then, or making movies a la Kevin Smith if that’s what he wants to do.
This week he was thinking about media being free. It’s actually far worse than that. Media is less than free. It costs you money and time to produce, and often the people consuming it are not going to pay for it. This came to me in a flash in New York City after touring NBC studios. A few blocks away I saw a subway sign for the TV Show “Heroes”. Here’s one of the biggest shows going, from one of the biggest entertainment conglomerates in the world, and they buy space on a bus to make sure it stays one of the biggest shows.
How can a lame podcast like The M Show compare to that? One easy answer is to change and go more niche. The M Show isn’t really different from talk radio, but Marketing Over Coffee is audio that you can’t find on the radio, or anywhere else.
It kind of makes you wonder how musicians can complain about the death of CD sales, while TV has dealt with end users getting the stuff for free from day one.
The problem with trying to find a way to charge for content is that it ends up throttling the only marketing the majority of content producers do – the giving away of great content for free, one of the oldest marketing stunts in the book. If it’s no longer free, now you need to find another way to make it spread. I’d like to be able to say that you can succeed on the strength of your content, but classical marketing says that you need to be anywhere from 5-10 times better to dislodge a competitor. Have you ever read a book that you felt was 10x better than everything else out there? Or better than the average? For me that’s happened maybe once.
So unless you have some budget to make people aware of your content, you are going to have to stick with free. There are some ways to make it work, you have two paths – one is to come up with a business model right away. For someone like Justin that could be having to say “70% of my time will be producing videos for others”, basically doing commercial jobs to fund the more entrepreneurial project. TheÂ other option is to ignore the cash and go hungry and spend every waking hour gathering an audience.
Once you have a fans, scarcity enters the equation once again – everyone’s audience is unique, and odds are they have characteristics that can’t be found everywhere else. When you reach a critical mass of people this can fuel a business model. Another method that I see as the wave of the future is product placement. There’s only x minutes of time within a story, and if people are clamoring to watch the story you can limit the supply by having only 30 seconds to sell out of the whole story. Let the bidding begin.