Truth and Consideration: When Homophily is Murder

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

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

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

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

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

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

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

Fight for Control of Your Internet Experience

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

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

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

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

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

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

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

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

The Confluence of Digital Marketing and Traditional Brand Marketing

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

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

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

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

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

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

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

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

Why I Will Never Go Back to Microsoft

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

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

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

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

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

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

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

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

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

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

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

I Speculate My Money Isn't Safe

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

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

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

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

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

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

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

A Half Billion Reasons to Reform Election Laws

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


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

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

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

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

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

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

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

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

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

The Crumbling Internet

The reporting hasn't been widespread, but I think the Internet is crumbling under it's own weight. Two massively popular services, Facebook and YouTube seem to be buckling. On YouTube, videos regularly get caught in a buffering state or don't start at all and the page needs to be refreshed. On Facebook, CDN loading times are lagging ("waiting for fbcdn.net ...") and more than occasionally I get the network transport error. And yes, I see it on other people's machines on multiple types of networks. It's just unreliable. Not unworkable. Just nagging enough.

Now interestingly enough both of these services have recently, and surprisingly, reported that they are near or at profitability well ahead of schedule. While many have talked about the surprising success of Facebook ads, especially the ad budgets of games like Farmville, I think it is more than coincidence that these performance issues are happening now.

The funniest commercial I have seen on TV lately has been the Verizon Wireless commercial "there's a map for that." Poking fun at AT&T's network is a little too easy. But it's too easy to take your natural lead in a market and cut costs to maximize profitability. You still have your features. Your bells and whistles. Your network value (Metcalfs Law). Your brand equity. But you have undercut your users for the sake of cost.

Would cell phone carriers have taken off if they were this spotty to begin with? Would Facebook be as popular if it were regularly frustrating? There's a natural cycle to businesses where you spend less time innovating and more time profiting from the existing market position. This tends to happen in a waning market, where long term iterative innovation just won't have an effective ROI. Disruptive innovation and creative destruction then rules, and new ventures open up new markets.

But it's way too early. This market has just begun. Premium video is being flanked by Hulu and other popular and accepted premium VOD services. It's easier than ever to discover content with video search engines. Netflix is poised to supplant cable. Now is not the time to alienate users.

And Facebook. You've got analysts saying that the future of digital advertising is about leveraging social network data to provide more effective ads. Facebook is now the leading photo sharing site on the Internet. And it's the biggest video game platform. It's the largest event planning site. But you have threats from Open Social, micro communities like Ning and yes, Weplay.

And so I find myself using Facebook a little less. Maybe it is become I am busy, but also because it is slow and clunky. And I am reading ACLU reports on how Facebook apps give away your friends info without their permission. And I am thinking to myself, is a backlash really possible? Is something that is so much a staple to many, really so vulnerable? Well, I have had a couple friends leave Facebook in the last week. Maybe it's too early to milk the business. Maybe the cookie is crumbling.

You Talk Too Much, Homeboy You Never Shut Up

I am embarrassed that after a month this is my blog post. But maybe it's the spark I need.

I was in San Fran this weekend talking to a friend who said that he was both loquacious and eloquent. It struck me as weird. Maybe because of the alliteration and reuse of the Latin base for voice. But it was more.

On the plane I realized it. Someone who is loquacious may think they are eloquent. Hopefully so, if only to justify their yapping. But it is doubtful it seems to me that an eloquent person would call themselves loquacious.

Hence, if you say you are eloquent and loquacious, the reality is you probably just talk a lot.

Q.E.D.

Independence and Gay Pride

Happy July 4th, everyone. Been a while since I blogged but there’s been plenty on my mind. With all the talk of independence on this day, my mind naturally wandered to the gay pride parade last weekend. What a show. Other than Halloween, I don’t know another day where so many take to the streets and challenge you. It’s kind of an odd comparison, but if you look at the pictures, the outfits were indeed a form of creative expression and a challenge of identity.

Whatever your feeling on gay rights, gay marriage, or even the morality of being gay, it’s impossible to deny the happiness of this day of pride in the eyes, smiles, hugs and celebratory gestures of all those who partook in it.

Growing up in Greenwich Village, I have been surrounded by homosexuality most of my life. You know, if an open 10% of the population can surround … As a result, I am much more sympathetic to their cause. The fact that they have a day of pride, only highlights that most days they combat shame. And it just reminds me of the hypocrisy of religious zealots, who seem to have taken the old testament lessons of intolerance from new testament readings. I am not sure how Republicans hijacked Jesus, but they sure don’t do a good job following his lessons of tolerance. How do you think he might greet and welcome a homosexual? I woudn't classify Christians as taking the Mary Magdeleine approach.

Lately, with the ideological collapse of the Republican party and the rise of jargonistic rhetoric, it seems that principles are used as oratorical tools rather than rules of guidance. You hear a lot about states rights in Supreme Court nominations and matters of political idealogy. But doesn’t it seem strange that the same people who vehemently defend state rights as a fundamental justification for banning abortion are the same people who are against states rights to declare gay marriage or pot legalization in another state? Same legal principle, just playing both sides of the argument as it suits your needs.

Particularly today, I think we should all take a look at what it means to be independent. What this day really celebrates. About taking a risk. Bucking the established dogma. Refusing to adhere to old rules. Declaring a higher level of freedom from what we know and maybe what we have ever seen. The rules at this point are perverse anyway.

What is the world we want to create for ourselves and for others? Embody the change you want to create in the world. Especially if that means being independent.

Where's the Old Spice of Women's Marketing

My friend

Colin Gorman

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

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

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

Another one I really loved was the

Day and Night video from Axe body spray

. They call it their Anthem. It's a really fun video that captures a day in the life of a college-aged party maniac. It really captured a lifestyle that the movie

Go

attempted and just missed. It's hilarious. And it's cheeky, fun, and a bit random with a lot of surprise.

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

I know there was the

Dove Campaign for Real Beauty

. But that was much more serious and clung to an issue rather than a lifestyle. Is there something out there I am missing?

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

I know. I am so proud!

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

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