The Super Bowl Commercials Teach Lessons in How Not to Advertise

The day after the Super Bowl, I’m still recovering from the commercials. Is it my imagination, or do they get worse every year? The unavoidable conclusion is that these advertisers and their agencies have no idea what advertising as all about. It was a mélange of nostalgia, obscure cultural references, borrowed interest, and non-product-relevant humor. Ironically, consumers constructed the highest-rated ads, not professional advertising agencies.

Secrets:

The purpose of any media is to reach people and use its unique characteristics to increase product sales. The purpose of advertising — with rare exceptions — is to dramatize the unique benefits of the product in a memorable and persuasive way that causes sales increases.

The Super Bowl is no exception, even though its ads have to compete with Super Bowl party conversation, food and drink, bathroom breaks and the competing emotions that come from rooting for the winning or losing team. So, yes, Super Bowl ads have to be off the charts on the attention-getting factor. This, and their astronomical prices, puts them in a class by themselves.

But none of this absolves the advertiser from the fact that the advertising needs to be about the unique advantages of the brand.

As I look over the list of the ads, from the idiotic USA Today Super Bowl Popularity Contest, I only remember ONE ad that talks about a brand advantage: The Verizon ad, which highlights its superiority in making calls.

The reason that advertising popularity contests are idiotic is that the purpose of an ad is not to entertain. It’s to ultimately sell product. This can be done indirectly, such as by enhancing the image of the product, or directly by talking about product advantages.

When I see a charming ad like the VW borrowed interest Darth Vader ad, I’m vastly entertained. But until someone shows that entertainment causes product sales, I’m amused but skeptical.

On the other hand, when I see an ad about the Ford Focus, which tries to gin up interest in a rally they are running, I think, “When you have nothing special to say about the car, run a rally.” It’s a dead giveaway that they either have a me-too car, or an incompetent advertising agency, or both.

As I’ve written elsewhere:

Before the golden age of advertising, people just put drawings of the product in the mass media, without any benefit statements or even descriptions. Then, advertising hit its stride and discovered its true strengths: bringing dramatizations of the unique benefits of the product to the masses. It was “salesmanship in print” in the best sense. It zeroed in on the most beneficial, unique aspects of the product and dramatized them in an entertaining way that got attention. At least, the best of it did. Then, the side show took over the circus. Most of it — to this day — gave up dramatizing the benefits and went for image instead. “Sell the sizzle, not the steak” became the rallying call for the hypemeisters. Advertising lost its way and just tries to make an intrusive impression, confusing getting attention with fundamental persuasion. Advertising is now judged by its entertainment value rather than its persuasive results. For instance, after the Super Bowl each year, there are many published polls naming the commercials voted “best” by viewers. So, you can win “best commercial” and go out of business because the commercials didn’t cause any sales, as 17 out of 18 of the Dot.com companies did in 2000.

Advertising that calls attention to itself — instead of something related to the product — almost never works. Advertising history is filled with examples. Many of them won awards. But the products failed.

I thought you might be interested in reading the section dealing with the Dot-Com Super Bowl, from the 2nd Edition of The Secrets of Word-of-Mouth Marketing, about to be published in March of 2011.

The Dot-Com Super  Bowl

On January 31, 2000, at the height of the dot-com boom, about a dozen dot-coms aired 30-second commercials during Super Bowl XXXIV at a cost of $2.2 million each, the entire marketing budget for some, in the hope that—with hundreds of millions of people watching—they would put their unknown companies on the map and establish a corporate identity. I was appalled and publicly called it the worst case of advertising agency malpractice I had ever seen. Either their ad agencies knew better or they should have. In either case, the agencies were, in my opinion, negligent.

The dot-com bubble burst soon after. The Super Bowl advertisers found that they could not establish a corporate identity in a 30-second TV spot. They found that they could get everyone talking about their quirky commercials all right, but that wasn’t the same as getting people to rave about their products’ benefits. With one or two exceptions, all the advertisers on that Super Bowl went out of business.

It became known as the Dot-Com Super Bowl and, in many people’s minds, it not only marked the end of the dot-com bubble, it marked the beginning of the end of the Old Marketing, perhaps symbolized best by the pets.com sock puppet.

Fortunately, the “too big to fail” mentality hadn’t caught on yet, so the dot-coms were allowed to “creatively destruct.” What nobody realized was that the dot-coms, ironically, were using the old media to sell the new media. Heck, they were the new media!

So, if you’re going to advertise, at least keep your eye on the ball: emphasize your unique benefits, in a dramatic, entertaining way. And only do it on the Super Bowl if you have a product that most of the billions of people watching can use. Don’t worry if people discuss it in the social media. Measure the effectiveness of ads — and any other marketing efforts — on trials and sales.

Possible duplicate posts and confirmations

February 1, 2011 |  by  |  Secrets of WOMM  |  No Comments

If you are receiving this blog via email rather than an RSS feed, you may get duplicates for a short time. Please accept my apologies. I’m switching from FeedBurner to AWeber, so you may get some emails from both. If you do, please look at the bottom line of the email. If it says Google, please just hit the unsubscribe link in the second line from the bottom. The one you want to keep is the one that says AWeber at the bottom.

You might also be asked to re-confirm by clicking on a link. Please do so to keep receiving my blog. The confirmation is because AWeber told me that confirmation was unnecessary, then sent out some anyway. Nothing’s easy. Thanks for your patience.

The good news is that I’m going to be sending you a link to a free copy of the second edition of Secrets of Word-of-Mouth Marketing, as soon as I get the web forms straightened out.

How to make the Customer Buying Process Easier, Simpler and Faster

January 28, 2011 |  by  |  Decision Easification, Featured  |  No Comments

Examples of Easifying Customer Buying Behavior

There are always blocks and barriers to the customer decision process.

Problem: Sometimes, the “customer” is a prescriber and approver, not the end user. For instance, a pharmaceutical company came to me with a drug that physicians strongly claimed they wanted to prescribe, but wouldn’t. I interviewed physicians who confirmed that they wanted to prescribe it, but didn’t. They were very defensive. It turned out that they couldn’t get insurance companies to approve the use of the drug without a long series of other drugs first, and complex approval phone calls or form (Certificate of Medical Necessity).  These phone calls were time-consuming and intimidating, requiring physicians to engage in a scientific justification they were not equipped to engage in. The hidden decision barrier was the high burden of time and intimidation that the physician had to bear  every time he/she wrote a prescription for the drug.

The pharmaceutical company had no idea that this was a burden, since — to them — the justification was simple and obvious. A classic case of Expert Blindness.

Solution: Their solution was so technical that physicians didn’t understand it. So, I interviewed high prescribers of the drug who had obviously gotten past this barrier. Obvious, but not so obvious if you don’t know about the hidden barrier. It turned out that some of the experts in the field who had busy clinical practices had developed a simple, one-sentence script that mentioned two peer-reviewed studies in reputable journals that said that this drug was the new standard. The sentence was one that any nurse could read or put on the form to get the approval. It was worded in such a way that it put the insurance company in a legally untenable position of they denied treatment, thus compelling approval. The salespeople were sent out with materials that addressed the issue, and prominently displayed the “magic sentence.” Sales tripled. We Easified the approval decision (“Is it really worth fighting this battle?” “No.”) to a no-brainer (“Is it worth it?” “Of course, my nurse can handle it in a few seconds.”)

Secret: There is almost always a simple solution: a barrier waiting to be discovered and a simple way of removing it.


Problem: In a more complex approval situation, the technical buyers didn’t know how to answer the financial concerns of the company’s top management.

Solution: I got permission to give out a “fill in the blanks” version of the presentation and spreadsheet that a customer used successfully to convince his company’s management — one that (unlike our client’s) talked their language and actually worked! I Easified the presentation construction and persuasion decisions and collapsed the learning curve.


Problem: A product’s acceptance depended upon a crucial fact that could only be established by an accepted industry expert.

Solution: I asked potential customers to tell us exactly what reassurance they needed, from whom. I then went to the most-named industry expert and drew out of him the perfect testimonial that used the words the customers said they needed to hear — increasing sales more than tenfold, establishing an industry record that has never been broken. I Easified the fact-checking and “justification of use” barriers.


Problem: Technical web sites that weren’t connecting to real people. Several of our clients’ products and services had gorgeous Web sites that were abstract, information dense and cerebral — missing the vivid, involving language that comes from the customer’s hearts and real-life experiences.

Solution: I formed an Advisory Group that provided emotionally compelling language that we put into simplified, less Flashy, focused web sites and presentations. The usual reaction is, “Wow, you really get what it’s like to be in my shoes.” I Easified the trust-building barriers.


Problem: Customer buying cycle that took years to gather enough experience to commit.


Solution: I’ve compressed the years-long decision processes of many products into a few weeks with teleconferences that put enthusiasts together with prospects, allowing them to gather more experiences in weeks than they could have in years. I  Easified the long, tedious and risky learning, verification and trial processes that usually take so long, particularly in the pharmaceutical industry.


Problem: I often find that complex products and services aren’t understood by their customers and their bosses.

Solution: I distilled their essence into a simple phrase that replaced the page-long incomprehensible nonsense that the high-tech client and their ad agency thought was crystal clear and irresistible. I Easified the cognitive burden.

Do you have a Decision Barrier that’s holding back your product? Believe me, you do. Could you use a consultation? Probably. Find out more: Click Here.

Back to Decision Easification page

Amazing and Moving Example of Word-of-Mouth Explosion

Watch these YouTube videos for an amazing, poignant example of how word of mouth, passed on from a social networking web site exploded into a national exposure (13 Million YouTube views as of this post!), got the man national fame, a job and a house, in a matter of a day or two.

I won’t say “Went Viral.” It was an explosion, not a viral spread. See previous post on the Viral Marketing Myth

YouTube – Raw Video: Homeless Man’s Voice Gets Natl Buzz


YouTube – (HD) Ted Williams, New CBS interview – Homeless man with golden radio voice


YouTube – Ted Williams Reunites with Mother after 20 Years

[CBS does not allow embedding into a blog. Click above to go to YouTube to view it there.]

The Viral Marketing Myth: Mea Culpa

January 2, 2011 |  by  |  Secrets of WOMM  |  No Comments

[Excerpt from 2nd edition of Secrets of Word of Mouth Marketing — April, 2011]
Modified slightly for blog post

Our understanding of the spread of word of mouth was helped in the early 2000’s by comparing the spread of ideas to the spread of infectious diseases, specifically viruses. It was a metaphor that both illuminated our understanding and obscured some important properties of word of mouth.

Until word-of-mouth marketing, all marketers knew that advertising, salespeople, and the rest of traditional marketing based on the broadcast model increased exposure of their product or service arithmetically. If 1,000 people a day were exposed to the product, after 22 days, 22,000 people would have been exposed. Exposure was, and still is, measured in cost per 1,000.

Richard Dawkins, Malcolm Gladwell, Seth Godin, myself, and many others popularized the idea that word of mouth spread new ideas like a viral epidemic. It seemed to explain the sudden, often overnight, spread of ideas. It caused a paradigm shift.

Here’s how we thought it worked: “Carriers” are at relative equilibrium, with about as many people getting “infected” as recovering from the disease. So, let’s say 1,000 people have the flu. They come in contact with 100 people a day, but they because they don’t touch or sneeze on all of them, they infect only 1%. So, another 1,000 people come down with the flu, which runs its course with the original 1,000, who are now cured (or dead) and cease to infect anybody else. However, the disease then finds its way to a denser or faster moving population. As a result, people are coming in contact with 200 people a day, so the spread of the infection increases to 2%. Now 1,000 people infect 2000 people, who infect 4,000 people, and so on. At that rate, if you do the arithmetic, the whole world will be infected in 22.5 days. At only a 2% infection rate!

It turns out that 75 percent of the world’s population would become infected on just the last two days! Even more amazing, on the last day, as many people will be infected as on all of the proceeding days put together. So, at the end, the spread of the disease appears explosive, as though it came from nowhere. Thus, an increase in the rate of infection from one to two percent can cause an infection to go from little growth to worldwide impact in 22 days! This leads us to believe, by analogy, that if you can get people to spread the word just a little more, the message will spread like a virus and take over the world. This idea of “Ideaviruses” reaching “Tipping Points” and spreading like infections was very compelling. This idea itself “went viral” and infected (actually poisoned) our thinking.

It obviously seemed to solve the mystery behind a common phenomenon of modern life. It fit the narrative. It explained the sudden adoption of ideas, trends, products, practices, and news that seemed increasingly to come out of nowhere to suddenly appear everywhere. The idea of the exponential, or geometric, growth model, and its relatively low initial numbers that seem to explode at the end of the cycle seemed oddly compelling. It would certainly seem to explain what is happening.

In fact, it’s a pretty powerful fantasy. As my friend Bill Cope used to say, “It’s approximately true.” In other words, it’s false.

The word of mouth pioneers—myself included—almost got it right (which is a nice way of saying we were wrong). Looking back on that heady period, I now realize that we were held hostage to our own viral metaphor. If we escape from the trap of thinking of word of mouth as spreading like a viral infection, we will unlock some pretty amazing secretss that will take us to the next level, much to our practical advantage.

My Advanced Experimental Design professor, Herbert Birch, MD, PhD, used to say, “Unless you understand the underlying mechanisms, you will think the light switch turns on the lights. It does not. The light is produced by the heat produced by the resistance to the electricity flowing through the filament. The switch doesn’t turn it on or off. It just breaks that circuit or recompletes it. Look for the mechanisms underneath what you’re seeing.”

The virus is like the light switch. It’s just a metaphor for a mathematical pattern, exponential growth—one that makes the pattern real to us. I thought it was a pretty compelling metaphor at the time. Most marketers still do.

So, let’s try to look at several issues here. How fast does word of mouth spread? How fast can it spread? By what mechanisms and patterns does it spread? Where does the viral analogy break down and obscure our understanding? How can we trigger word of mouth? How can we slow it down when it’s undesirable, or speed it up to our advantage? What can we do to intervene? (That last one is the purpose of all books on word-of-mouth marketing, indeed, the whole word-of-mouth industry.)

First, the Pattern

Consider the following.

Step 1: 1,000 people hear about a Cool New Thing.

Step 2: Each, in turn, tells 25 other people. Now, we’re up to 25,000, plus the original 1,000.

Let’s make it real. These aren’t viruses, after all; these are people and ideas.

Nor is this higher mathematics. If I can understand it, you can follow along. We know that sneezing does not spread word of the Cool New Thing, so we must ask: Who are these people and whom have they called, texted, Tweeted, emailed, or buttonholed at work or at school to discuss the Cool New Thing?

First, the initial thousand are probably an assortment of people who are at the front of the adoption curve. They are the innovators and early adopters. Some are probably influentials whom the company spent a lot of money identifying. But others are slower to adopt; they are the people who just happened to hear about the Cool New Thing by accident. Maybe it was shown to them by their daughter’s boyfriend or a seatmate in an airplane or the aunt of an employee who came to dinner. Still others are experts, mavens, infomediaries, newsies, and people with very large numbers of so-called “friends” on Facebook and Twitter. Others are neither plugged in nor particularly influential. These days, even a hermit (perhaps especially a hermit?) has 25 people he wants to email or Twitter about the Cool New Thing. Everyone focuses on these initial

1,000 transmitters. But there isn’t a lot to learn from them except their variety.

Let’s look at the 25 people they each tell about the Cool New Thing. Now, first of all, 25 is not a lot of people. Who are these 25 people? This is important. They aren’t random, as are viruses. These are people. They are the people whom the original people chose to tell about the Cool New Thing. No disputing that.

“Why that person and why that product?,” you ask. You know just as well as I do because you do it all the time. They’ve made two choices here.

1.  The product is Cool enough and New enough to tell people about.

2.  The particular person is someone who should hear about it.

Set aside for a moment how something crosses the “cool-enoughto-talk-about” threshold. The original people are going to tell people with whom there is a “fit.” Whom would you tell? People who would benefit from hearing about the Cool New Thing and who would probably appreciate hearing about it. People who may benefit from your natural inclination to be helpful to others; people who will think all the better of you for having told them; and—I think most important—people for whom the act of telling them will make you feed good about yourself. You’re not going to share your new information with people who have no use or appreciation for it, people about whom you don’t care or people who won’t appreciate your informational generosity.

I’m trying to make as real as possible the obvious “Secret” here: you share with people for whom the information is relevant and who will appreciate your telling them. And, you don’t share with people for whom the information is irrelevant, unless you’re a crashing bore.

Okay, so there is a good match between the Cool New Thing and the handpicked 25,000 people who hear about it. In fact, the match is probably a little better than it was for the original 1,000, who found out about it accidentally, randomly, or impersonally.

So, now you have 25,000 people who are probably a little more interested and excited than the original 1,000. They have a better understanding and appreciation of the Cool New Thing. They’re likely more knowledgeable. It will benefit them more, so there are more emotions around it, more excitement, admiration, and amazement.

The result: their message about the Cool New Thing is probably more articulate and emotionally engaging than the original message they received.

So the old game of “telephone” (AKA “Whisper Down the Lane”) you may have played in psychology class or with your friends taught you something that was misleading. You played it with an inconsequential message that was needlessly detailed. The message disintegrates when it’s a meaningless rumor. But when it has focused, simple, relevant, involving content that the person is interested in getting right, the receiver asks questions actively. In “Whisper Down the Lane,” people are passive.

So, the content of the information tends to build in quantity and quality and is expressed more articulately, emotionally, and enthusiastically. It reaches and is spread by people who care about the content. Now, what’s going to happen? These people are probably going to tell more than 25 other people and tell it more clearly, more meaningfully, more passionately, and more persuasively.

SECRET

The quality,  relevance, and enthusiasm of the information passed  on  through word of mouth can,  under some conditions,  actually improve through successive iterations of transmission. In addition, the ability of people  to transmit   it to the right people  often improves.

SECRET

Word of mouth is what I like to call a self-improving system.  Treasure it. There aren’t too many in this world.


Here’s what happens next in our quality and quantity journey,

Step 3: Now suppose each of these people pass the information to 50 people, on average. Don’t forget, they are much more motivated to do so. They will embellish and improve the message, perhaps adding video. Certainly they will apply their own accumulated experiences, thereby offering more than abstract facts.

Do they know a large enough number of people to select 50 for whom the message is most relevant? Of course they do. These are the people at work or at their special interest clubs, who are reading comments on websites, in their schools, from their email contacts, on their forum, and so on. None of them are hermits. Maybe they spread the word by writing articles in their association’s newsletter or on a blog or other news sources. When we say these 50 are selfselected, it means that they respond to a headline because they see Cool New Thing does awesome stuff in the headline. They’re really jazzed. They’re abuzz. Maybe they’re frenzied, like people outside an Apple store the day of a new iCoolNewThing launch, reinforcing one another’s enthusiasm. (Full disclosure: I’ve done this twice. Embarrassing, but true.)

Those 25,000 people have now each told 50 people. Wait, while I get out my calculator. That can’t be right, but wow, it is. The improved message has now reached 1,250,000 handpicked people in only three steps.

Step 4: If these 1,250,000 improve it and each pass it along to 75 people, the total number of people who have now received the message is 62,000,000.

Step 5: If these 62,000,000 spread it to 100 people each, the total is now a staggering 6,250,000,000.

This is more than the adult population of the world!!!

A more accurate metaphor to word of mouth than viral growth is the exponential growth of a nuclear chain reaction. Both word of mouth and a nuclear chain reaction need to start with the right conditions, that is highly refined fissionable material. They need critical mass, sufficient density, and a jump start. Both have an accelerating growth rate and are self-sustaining reactions that feed on themselves. Both have growing energy, change form in the process, and permanently alter things. If not, it’s a dud.

SECRET

Word of mouth isn’t like a virus and doesn’t  spread like one.  It’s a nuclear explosion or a dud.

I know that I’ve made several false assumptions for the purposes of easification. But, when you take them into account, it strengthens the case:

In fact, one person will tend to get many different exposures to the same message, from many different perspectives, and from many different people. It’s not like the same advertisement repeated endlessly as it interrupts her favorite TV program. So, a lot of people hear all of their friends raving about their experiences with the Cool New Thing or see it being used (the most persuasive way of “telling” someone about a product, since actions speak louder than words.) When multiple friends pile on the message, people are tens of multiples more likely to purchase. That’s why the Zune never had a chance against the iPod, even if it had been well designed. iPads, iPhones, iWhatevers are Apple’s to lose, not for another company to take away.

Adding a Killer Ingredient: Network Effects

“Network effects” is a term in economics. It means that some things are made more valuable if more and more people use them. Not that the items have more uses, but rather that more people are using them.

For example, your neighborhood park is made less valuable as it becomes more and more crowded. But some things become more valuable. I learned of this effect firsthand around 1975 when I purchased our company’s first fax machine, the “Xerox Facsimile Telecopier.” Although it was an unwieldy, rotating drum that enabled the transmission of low-quality copies of documents, it made projects so much easier. A client made us get the machine, and it made our workflow so much more efficient that we practically required our clients to get it. The point here is that it’s of no use unless both parties have one. And, it’s so valuable that you want everyone else to get one. That, in turn, increases its value to you. So, you have a strong motivation to “push” its adoption. This isn’t just a Cool New Thing that you’d like other people to have, a situation where it may make no difference to you if they get it. This is a case where if they get it, your life (and theirs) is improved.

It doesn’t do me any good if I throw an auction and nobody comes. So, I’m going to tell everyone who’ll listen about eBay, and I’ll even help them sign up. The same is true about PayPal, LinkedIn, Twitter, Facebook, email, blogs, and the next twenty things that manage to build in network effects.

That’s the Network Effect. It’s now called the “Viral Feedback Loop,” newly discovered by the technology sector, but it’s been known for a long time. So, now we have word of mouth passing along information selectively in a highly motivated manner.

So, mathematically, we have something that appears to be more powerful than exponential growth, which is a population multiplying by a constant factor. We have a multiplying factor that is increasing, maybe even multiplying itself. I don’t know if there is a mathematical name for this phenomenon; non-mathematicians call it an explosion.

Even if I’m wrong and it’s “only” an exponential growth rate, it’s still amazing. I prepared Table 3-1 when I believed the growth rate was exponential. It always gets audible gasps. And, this is underestimating the rate. Table 3-1 shows the results of 25 people telling 25 different people, who do the same, in turn, six times. Here’s the result

Table 3-1

Exponential Growth Rate

1st Wave

25 people  tell  25 each  =

625

Neighborhood

2nd Wave

625 x 25 =

15,625

Town

3rd  Wave

15,625 x 25 =

390,625

City

4th  Wave

390,625 x 25 =

9,765,625

NY  City

5th  Wave

9,765,625 x 25 =

244,140,625

Approximate U.S. adult population

6th  Wave

244,140,625 x 25 =

6,103,515,625

Approximate world population

From 25 people to the entire world in six steps! As we’ll see, people have a much higher talking and listening threshold, so information spreads faster than viruses. If they do not think something is worth talking about, they talk about something else. Economic theory is something I like to talk about, but teenage girls like to talk about clothes and boys. There’s little danger of any of my memes infecting them. But try to stop each of them from texting 100 people a day about the latest clothing fad, with videos included.

So, word of mouth tends to be either explosive or unworthy of conversation. If it doesn’t explode, it will likely fizzle. Given the table above, in which the 25-people multiplier is probably a serious underestimation, the recently reverified “six degrees of separation” shouldn’t be a surprise. You really can get from just about any person to any other person on the planet in six steps or less.

Therefore, let’s stop using the term “viral” as a synonym for “runaway word of mouth.”

“Viral” leads 2011 List of Banished Words — Hooray!

December 31, 2010 |  by  |  Secrets of WOMM  |  No Comments

A university has just put “Viral” at the top of their 2011 List of Banished Words.

Bravo!

Now, let’s ban “Viral Marketing” from the marketing lexicon

Usually, when people talk of the “viral” spread of anything, or “viral marketing,” they have no idea what they are talking about. They just mean that something got popular. When they do know what they are talking about, as in the authors who speak of Viral Marketing, they are flat out wrong.

The next edition of my book The Secrets of Word-of-Mouth Marketing, due out in April of 2011, goes into some detail about how the infectious disease analogy — viral marketing — that we all spread 10 years ago is not correct and obscures a deeper understanding of how word of mouth spreads.

Excerpt from second edition of Secrets of Word-of-Mouth Marketing to be published April, 2011, explaining why “viral marketing” is a misleading metaphor.

Lessons from Branson — treat people like people: encourage “pinching” salt shakers

Richard Branson was just on Morning Joe, on MSNBC. He finds that the present practices of American airlines is “bizarre.”

Asked why other airlines don’t treat people better, he said, “I love people, and hopefully that richochets down through the company. Your people are only going to be as good as the products, the tools you give them to use… so if we give them the most comfortable seats, the nicest lighting, the best entertainment systems, etc., everything single detail right, they will be very proud of the company the work for, they’ll come in smiling and happy, and the passengers will be smiling and happy. …Never cut corners.”

He talks to the passengers and staff when he is on a flight. He carries a notebook where he makes note of the smallest detail.

For instance, people were stealing the salt and pepper shakers because they were so attractive. What would you have done?

They put “pinched from Virgin” on the bottom…”the best advertising you can have.” What would United have done?

Why are all the other airlines going in the opposite direction? Paying for bags, smaller seats, paying for food?

Branson replied, “It’s bizarre.”

“They have not cared for their people, they herd them on like cattle. I’m baffled, bemused. When we get up to 8-9% of market share, they will have to react.”

Notice, he doesn’t call them customers. They are “people,” as are his employees.

Lessons: His orientation is, do it right, attend to the details, don’t cut corners and “hopefully, we’ll show a profit at the end of the year.” My take on this? If your focus is on your PEOPLE (customers and staff), you will treat them as friends and they will talk.

What can you do, right now, that’s the equivalent of putting “pinched from Virgin” on the bottom of YOUR [metaphorical] salt and pepper shakers?

Word-of-Mouth Campaign Effectiveness is Impossible to Measure by Conventional Means

November 24, 2010 |  by  |  Secrets of WOMM  |  No Comments

The Silverman Uncertainty Principle:

You can’t measure your word-of-mouth campaign with a conventional control group design, because the purpose of word of mouth is to set off a chain reaction of second-order word of mouth that reaches everyone quickly. In experimental design, it is called “contaminating the control group.”  You can’t use a pre/post design because you can’t control for the other variables without a control group, which you can’t use. Also, the second order effects are much more powerful than the initial exposures. Your boss is going to hit the roof over this.

The Problem with Word-of-mouth Measurement

Word of mouth is the only marketing method that can’t be measured accurately. Even more disturbing is that the more effective the program, the more likely any attempted measurement is going to be invalid. That’s a serious problem, because most companies now require that you show a substantial return on investment (ROI) for any marketing method you use.

Don’t get me wrong. You can plot the number of mentions of your product on the social media when compared to your competition, but that’s not the same as measuring the bottom-line effectiveness of a particular word-of-mouth campaign. That campaign isn’t the only thing that’s happening in the world. You can’t use a control-group design, for instance, to measure the purchases of people who attended your Webinar. The major effects may be on friends of friends. In most cases, that can’t be tracked back to its source.

This  lack of measurability goes contrary to common sense. Everything else is measurable, so it seems obvious that word of mouth must be measurable.

More to come on this, but I welcome your comments.

The GM Decline Predicted in 1990

November 8, 2010 |  by  |  Focus Groups  |  No Comments

I just came across this from an article titled “Strategic Listening” that I wrote in 1990. I thought it was interesting in the aftermath of the bankruptcy of GM, its bailout, and its immanent IPO.

General Motors

I once wrote to General Motors in the early 70’s, when they were totally dominating the market, and suggested a dealer telephone focus group program. They sent me a legalistic letter explaining that they get ideas from all over, and that they could not accept unsolicited “proposals” because doing so would raise questions and lawsuits about who originated the ideas. In effect, they were declaring that they were closed to new ideas “Not Invented Here.” Lee Iococca is another example. He declared that he didn’t believe in marketing research. Neither Chrysler nor General Motors has been doing too well lately. Ford, on the other hand, is doing very well. They learned from the failure of the Edsel, and many other hard knocks, as well as the success of the Taurus. They seem to be listening to everyone. In fact, the way they built the Taurus, which is well documented in the business literature, is an extraordinary lesson in external and internal listening. Ford is becoming identified with quality (Quality is Job 1), and delivering quality. It is also winning. Bravo!

Moral: If a good idea falls in the forest, make sure you are set up to hear it.

An interesting word-of-mouth technique shows the darker side of word of mouth

First, I have to make a disclaimer. I am not advocating the following, I am reporting on it because it is interesting and illustrates several important properties of word of mouth.

Let’s call it hoax marketing:

Here’s the way it works:

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How my interest in marketing started

October 16, 2010 |  by  |  Marketing - Gen'l, Secrets of WOMM  |   |  No Comments

My interest in marketing started one day in my father’s drug store. I watched a Camel Cigarette salesman repeatedly approach customers who had just bought a pack of the largest competing brand, Chesterfield.  He had pushed a Camel and a Chesterfield cigarette through two holes in a 3 x 5 index card, so that they couldn’t see the cigarettes’ brand names. He asked them to take a few puffs of each and tell him which they liked better. Most of the Chesterfield smokers said that they preferred the taste of the one that turned out to be a Camel. He showed them that they had chosen a different brand, Camel, over their regular brand. They were shocked, much to my amusement. It looked to me, at about the age of 12, like a pretty good joke on them. But then came my turn to be shocked. He offered to exchange the cigarettes they had just bought for his brand, whose taste they had just proven they preferred.

Most of them stuck with their regular brand!

I saw another salesman do a similar comparison test with Breyer’s Ice Cream. Same results. Even though they preferred Breyer’s, they walked out with their regular brand. “Why?” I wondered.

At the same time, I was learning to practice the art of slight-of-hand.  As I mastered more and more sophisticated magic tricks, I realized that people saw what they wanted to see, no matter what the evidence said. Why?

I was hooked.

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Revised Table of Contents—Secrets of Word-of-Mouth Marketing, 2nd Edition

Here’s a much more manageable table of contents of Secrets of Word-of-Mouth Marketing: Marketing in a World Where People Only Listen to their Friends, 2nd Ed. April of 2011 is the target publication date. But you don’t have to wait. My deal with my publisher is that I can use modern word-of-mouth marketing techniques and post the contents of the book online. If you want to carry it around and make marginal notes, you’ll have to buy the paper book or e-book when it comes out.

The Secrets of Word-of-Mouth Marketing, 2th Edition

Prologue: The Calf-Path

1.   Why This Book—and Word-of-Mouth Marketing Today—Is Different

2.   Changing Your—and Your Company’s—Way of Looking at Things

3.   The Systematic Approach to Word of Mouth

4.   Dominating Your Market by Easifying the Customer Decision Cycle

5.   How to Use Word of Mouth to Easify the Decision Process

6.   The Decision Process

7.   The Nine Levels of Word of Mouth

8.   Five M’s to Live By

9.   Researching Word of Mouth

10. Creating the Content

11. Delivering the Message

12. Electronic Word of Mouth

13. Six Steps to Harnessing Word of Mouth

14. Viral Marketing…Maybe

15. Constructing the Ultimate Word-of-Mouth Campaign

16. Which Methods Work Best for What?: Word-of-Mouth Checklist

17. Your Word-of-Mouth Toolkit

18. Managing—and Leveraging—Negative Word of Mouth

19. Word-of-Mouth Marketing for Specific Audiences and Circumstances

20. Tips, Techniques, and Suggestions That Will Make It Easier

21. Word-of-Mouth Measurement

22. How to Fight Word-of-Mouth Fraud and Other Shady WOM Practices

Appendices

Recommended Reading

The New Media

The new media are not just incremental improvements. They are fundamentally new ways of doing things. They are supplanting the old media because something basic is changing. So, High Definition TV is only a quality improvement until it becomes so realistic that it changes people’s behavior. For instance, people actually stay home and invite friends over to watch a current movie via Blue-Ray DVD because it’s actually a better experience for them than going out to the movies: better video, ability to stop, better food, cheaper popcorn, ability to talk, etc.

Notice that almost every one of these increases both overload and word of mouth in some way. Some are actually WOM media, some stimulate WOM, and others force it.

It’s hard to believe that the following media emerged that weren’t even mentioned in the first edition this book because they didn’t exist or hadn’t caught on yet:

This isn’t a complete list, it’s in no particular order yet, and the categories are fluid and overlapping. It’s just to give you a flavor of how much we’ve been hit with in the last 10 years.

Media Examples, comments
Blogs The whole world of Twitter, WordPress, Technorati, Blogger, TypePad, etc.
Rating & Review sites Zagat, Yelp, Opentable, Tripadvisor, , C-net, hotels.com,, etc.
Social Networking Facebook, Twitter, Linkedin, Myspace
Social Bookmarking (Digg, Diigo, Stumbleupon, Reddit)
Mass Collaboration Open Source Movement, Google Wave, Google Docs, Various Microsoft Collaboration Tools
Wikis WikiPedia, WikiHow, WikiNews…
Remote meetings GoToMeeting, Adobe Connect, etc.
Webinars, Remote Courses, etc. University of Phoenix (current enrollment: 240,000+), 1000’s of private courses, etc.
Texting, Video chat ICQ, iChat, Jabber, Buzz, etc.
RSS feeds, Newsreaders, News aggregators, Mega News Sites “Reverse Browsing”: Google Reader, Netnewswire, Feedblitz, Feedburner, etc.
Customer-generated Media (CGM): YouTube, Flickr, …
Recommendation Engines Netflix, Jinni, IMDb, Rotten Tomatoes, Last.fm
MP3 players iPods, Podcasting
500+ Cable, Fiber Optic and Dish Channels CableVision, Fios, Dish Network
Downloaded TV Episodes iTunes downloads, etc.
Web TV viewing Hulu, Network web sites
Flat Screen TV, HDTV, 3-D TV and Movies IMAX, home screens
Universal Remote Controls Important means of skipping commercials, switching to other content. Lets people pause and engage in WOM.
Video Games

Game Boxes

Video Boxes

Bigger than Movies and Music combined!
Microsoft X Box, Wii, Playstation
TiVo, Apple TV, Roku, Slingbox
Smart Phones iPhones, Android Phones, etc.
Tablets iPad, etc.
Mobile Apps 250,000+
Netbooks
Web 2.0 All customer-provided content sites
Shareware, donationware, etc. Variably priced, payment optional, etc.
Filesharing Protocols and sites Napster, LimeWire, Pirate Bay, BitTorrent, Magnet Links, etc.
Portable, High-Capacity Drives USB Flash Drives, High Capacity portable drives
Music/Movie/Video Downloading services iTunes Store, Apple TV, NetFlix,
E-Books & Readers Kindle, iBook, Sony Reader, Zook, etc.
Digital Cameras, Video Complete conversion to digital from film, pocket cameras with video.
Digital Photos and Video Picassa, Flickr, Lightroom, iPhoto
Web Apps Google, Google Apps, Microsoft Office Web Apps etc.
Mass Collaboration, Hive Mind
WOM agencies Unknown in 2000, too numerous to mention now.
Advocacy Networks BzzAgent, Tremor
Auction Sites EBay (in its comparative infancy in 2000)
eCommerce, Electronic Payment Systems PayPal, Google Checkout, millions of web sites
Classifieds CraigsList
Very Fast Broadband and Broadband Wireless
App phones IPhone, Android, etc.

With hundreds of thousands of apps, many designed to locate products, ratings, comparative prices, etc.

VOIP Skype, Vonnage, etc.
Ubiquitous Network Access 3G, 4G, WiFi, WiMax, VPNs
Cloud Computing: unlimited storage & processing on demand. Amazon EC2, Google, etc.
Geotagging
Google Earth
Google [Everything)
Content Management

Information Management

Information Architecture

Knowledge Management

Drupal, Joomla
Word of mouth agencies




…to name only broad categories. Some of these categories have hundreds to thousands of instances: Thousands of eBay merchants, thousands of rating sites, travel sites, mash-ups, etc.

Remember when we all had AOL accounts, brick-like cell phones, dial-up modems and used Yahoo as our search engine? That was right around 1997.

Gone — or almost gone — are faxes and faxback, hotlines, pagers, classified advertising, newspaper stock listings; physical dictionaries, encyclopedias, thesauruses; physical recording media such as floppy disks, records/cassettes/CDs/DVDs (almost), PDAs, photographic film, simple bulletin boards/forums, dial-up modems, Physical Maps, Traveler’s checks, telegrams, travel agents, pay phones.

Soon to be obsolete, or nearly so: Newspapers and magazines (in the paper forms we know them), paper books & bookstores, conventional libraries, handwritten prescriptions, land lines, paper money, major broadcast TV networks and cords connecting anything.

Notice that the new arrivals are almost all things that increase our interactivity and connectedness, and, thereby, our overload. They also increase our ability — actually necessity — to engage in word of mouth.

So, the Secrets you can learn from this are:

Involvement and collaboration is what it’s all about now.

The new media have brought a whole new level of overload.

Secrets

A teacher once observed a child having trouble zipping up his jacket. She said, “The secret is to put the straight part all the way in, hold it in with one hand while pulling on the tab with the other hand.”

The child asked, “Why is that a secret?”

In this book, “Secrets” means key principles not generally known, not things people don’t want you to know.

The central purpose of this book is to lay out the secrets — key principles — of Word-of-Mouth Marketing, as distinct from all the details of the techniques. There are so many of them now that it would take 1000+ page book that would be instantly obsolete. By concentrating on principles, this book will help you even think about  the things that haven’t been invented yet!

Microsoft is an easification wannabee; they may actually get there

Microsoft recently sent me a survey with all the usual questions about their products and services. What an eye-opener. I used to spend most of my working life on their programs: Ran Windows programs, Outlook handled my calendar, contacts and to do’s, and Word and Powerpoint handled my writing and presentations.

The survey made me look at all these areas against Apple and Google. It made me realize how much I rely an Apple and Google for innovation, and how I’ve gradually drifted away from Microsoft’s technology. I miss Microsoft. I really do. They’re still innovative, but nothing like Apple and Google.

Judging from the emphasis in their ads, they understand that their customers want ease and simplicity. They are Easification Wannabees, which is better than being oblivious. Imagine what would happen if they were able to reach their aspirations?

The secrets:

  • The marketplace is a powerful self-correcting mechanism.
  • Even a company that totally dominated a field can be eroded.
  • Never take your customers for granted.
  • You cannot overestimate the power of Ease and Simplicity in driving sales.
  • The Complexity Trap is almost inescapable (see below).

I’ve just tried Office 2011 for the Mac. I had high hopes that maybe Microsoft has evolved. They have, somewhat. The new Office illustrates the Complexity Trap. Once you’re in it, it’s almost impossible to get out of it because while I’m looking for a radical mutation into something as elegant as Pages, Keynote and Numbers, if they did that, their installed base would howl that things are no longer in the same place and now the program is harder to use. They struck a pretty good balance, but Word (all I’ve tried so far) certainly isn’t elegantly simple and intuitive yet. I see what they’re trying to do: gradually making it cleaner and easier. But at this rate, they’ll get there in about 25 years.

I would really like to like them again.

A Farmer Selling Onions

October 10, 2010 |  by  |  Marketing - Gen'l  |  , , ,  |  No Comments

As I was writing about consulting with more clients in the form of smaller consultations, rather than mega-projects with giant companies, I remembered the following story:

A farmer was sitting at the side of the road, selling onions. A tourist stopped and asked how much the onions cost.
“A dollar a pound.”
“How many pounds do you have there?” asked the tourist.
“20.”
“How much for all 20 pounds?”
“Thirty dollars,” said the farmer.
The tourist was surprised. “No, it should be less than $20 because 20 times one dollar should be $20, less a volume discount for taking them all off your hands at the same time.”
“I know that,” the farmer replied. “But if I sell all 20 pounds to you, I have to go home. If I sell them one pound at a time, I’ll get to meet and talk with 19 other interesting people like you.”

I’ve been telling that story for more than 30 years. It always impressed me. Originally, I heard it told about an “Indian.”

Life isn’t all about maximizing efficiency. By offering smaller consultations, I’m sure meeting a lot more interesting people. Who knew that custom sheds, unusual web sites, physician services, emergency management and other products I would never have heard of could be so interesting? What fun!

Now YOU Can Rent George’s Brain to Answer Your Most Important Marketing Questions

October 10, 2010 |  by  |  Marketing - Gen'l  |  No Comments

Small to Mid-Size Companies
Can Now Afford
an Expert Marketing Consultant

I will find the 2 or 3 hidden decision blocks that are killing your sales and show you how to fix them. Unlike most other marketing consultants, I’m not interested in tweaking and tuning — I’m interested in breakthroughs that multiply your sales.

I focus on THE most important thing that you’ll benefit from most: What is blocking your customers from deciding on your product and becoming an enthusiast? What’s making it hard for them? What would make that block go away or easy to overcome?

  • I will give you breakthrough practical advice for your specific situation.
  • I will rank my advice and just tell you the best next practical 2-3 steps that will make a dramatic difference, instead of overwhelm you with minor tweaks.
  • You can “pick the brain” of an  expert who has spent decades introducing hundreds of new products, services and ideas — and increasing the sales of established ones.

But how does a small to mid-size business with limited funds get access to a top marketing consultant?

Small to Mid-Size Business Marketing Consultation. Now.

In response to so many phone calls, emails and pleas for help from small and mid-size businesses, who agree with the idea of Decision Easification, I’ve cre­ated this con­sult­ing pro­gram for smaller  and medium-sized companies with big ideas.  You can simply “rent my brain.” You get sound, personalized guidance; clear advice; tested ideas;  prac­ti­cal how-to’s; and can­did feed­back. I know you have many issues and questions. To get you started, here are some of the vital questions I’ve answered recently in 1½ hour consultations, often many questions in each consultation:

  • Is my idea practical? How can I tell, without spending tens of thousands of dollars in surveys and focus groups? How can I turn it into something even more exciting?
  • How can I get the word out, find my customers, or get them to find me, with a much more limited budget than competitors? Who should I be concentrating on?
  • How can I describe my product or service to people who don’t know and don’t care if they need it? In this information-overloaded world, how do I get them to remove their earplugs?
  • How can I avoid the pitfalls I’m sure to fall into — because almost very product does. Even experienced marketing VPs have only launched a handful of successful products in their careers. I’ve been a major advisor in the launch of hundreds (literally) of successful products — and a few failures. I’ve learned a lot along the way.
  • What decision barriers am I going to run into? How can I avoid the avoidable, see the invisible and triumph over the inevitable obstacles?
  • How can I possibly compete with companies hundreds of times my size — and compete in  my market, not live off their niche table-scraps?
  • What would be the best, clear, useful, practical, implementable marketing strategy for my product starting now, on a budget that works, with fewer risks and mistakes?

To see more possible questions, click here. How much would you be willing to pay to get several of these questions answered in ONE 1½ hour consultation? Read on; you’re in for a surprise.

How can I address several of these major issues in only one consultation?

Especially if we haven’t done the kind of in-depth marketing research that I’ve advocated all over this website? Experience. Mine and yours. I’ve been through the customer decision process of hundreds of products, services and concepts. I’ve reached a point where I can quickly zero in on major decision blocks just by looking at your marketing, and by listening to your descriptions of what is working and not working. And, you haven’t exactly been a hermit. You’ve talked with customers, received their praise and complaints, talked with your salespeople and others. You know much more than you think you know. So, my recommendations combined with your input can have a dramatic impact immediately.. Then, later on, you might want to do the kind of research I’m advocating to further optimize the system.

So, for example, I’m going to ask you to describe your trial process and your guarantees, or other risk-reduction techniques. I don’t need to do a lot of fancy research to know that a product with the wrong kind of trial is a product that is losing a lot of sales. But structuring a meaningful trial is a matter of knowing the many options that aren’t obvious. Or, take guarantees: even companies with a strong guarantee may be guaranteeing the wrong thing. You may be guaranteeing their purchase price, but they might need a guarantee that they won’t look like a fool. There are dozens of such issues that I can spot without extensive market research.

Why do I need you?

I’ve helped hundreds of product managers, marketing VPs, CEOs and entrepreneurs with questions like these in my career. If you want me to help YOU, I’m ready to roll up my sleeves and help you launch a successful product — or grow your existing ones.

Let’s face it: You need outside, savvy feedback because you’re too close to your situation. I have built my reputation as a straight shooter. I call it like I see it, because I sincerely care and I know that fluffing you up will not get you what you want. I’m tough, I’m honest but supportive and frankly, I’m usually right. (Except for that one time in 1983 when I thought I was wrong! :lol:)

What does it cost?

Renting my brain for this invaluable 90 minutes is just a $500 investment on your part — and our conversation could change the direction of your product or company! My assistant or I will contact you to set up a time convenient for us to talk.  When our time comes, you’ll call me and I’ll give you my undivided attention for ninety sincere, transformative minutes. Record the call for future reference (I’ll do it if you’re traveling, for instance, and email you the audio file.) Sign up for a consult.

Your guarantee:

At about the 45 minute mark of our conversation, we will reach the “Go/No-Go” point: I’ll ask you if you feel you are getting great value for your time and money. If not, we’ll end the conversation and I’ll refund your money immediately, through PayPal or a bank check, no problem. If yes, we’ll continue to transform your product, service or idea.

You really can’t lose. Take a shot.

The $500 will make absolutely no difference in your or my way of life; neither of us will feel it in the least. But the results can transform your business. If you can’t get ten times the $500 in an hour and a half of talking with me, then we’re either both idiots (I know I’m not, and if you found me and browsed my web site, I’m sure you’re not either), or there is a terrible mismatch that will become clear well before the go/no-go point in our conversation. By taking advantage of this opportunity to do a phone consultation with me at a time of your choosing, we make it easy for you. YOU get my brain on YOUR terms, helping YOU sort out YOUR issues, giving YOU the best advice on the topics of your choice.

You’ve looked over my web site and/or read my books. You’ll have the entire benefit of my 40+ years of professional wisdom. By the way, I look at this as a completely self-contained consultation, with no obligation on your part for additional consults, and definitely not as an opportunity to sell you added services. (If you’re interested, we can discuss it in a free call, on my time, not yours.) My goal is to cram as much ready-to-implement, practical advice into the 90 minutes that you are recording so that you go away deliriously happy, with your head spinning, but able to take enough immediate, high-payoff action so that you never have to speak with me again. If you want to speak on a regular basis, that’s YOUR call, YOUR frequency, YOUR content. I’ll even work up a flat rate for a defined project, with unlimited access.

If we spend an hour and a half and you make a few million dollars as a result, I only ask two more things: (1) Take me out to dinner at a fancy NY restaurant next time you’re in NY and tell me the story. I live for these kinds of stories. And (2), let me write a short summary that I can share with my readers and other clients. I’m sincerely looking forward to helping YOU meet YOUR goals.

Ask yourself what is the value of one great, relevant, practical idea, one missed key question asked and answered? What’s the benefit of having one wrong assumption corrected? Then fill out the form below. Now, before you get distracted again.

 

Simple isn’t easy. Easy isn’t simple.

The title above is deliberately ambiguous. I mean both meanings:

(1) It’s very hard to make things simple. And, it’s very complicated to make things easy.

(2)  The difference between simple and easy: After running out of food, the guide asked, , “Would you like worms or bugs for dinner tonight?” Simple, but not easy choice. (2) Following turn-by-turn navigation on a complex route via a dashboard gps system: complicated, i.e., not simple (not uncomplicated), but very easy).

For now, I’ll spare you the photo of bugs, worms and a map with and without a route marked. (Map without route, complex and hard. Map with route marked on turn-by-turn gps system, just as complex but now easy.)

It’s an important distinction because most people think that the way to make things easy is to make them simpler by removing parts. That’s ONE way. But there are many others. The route drawn on a gps device is actually adding complexity, but making things easy. In marketing, what you want is decision easification. [Wish there were an easier way to say it! 😉 ]

Economist Announces Discovery of the Source of Wealth

October 9, 2010 |  by  |  Ideas and Persuasion  |  , , ,  |  2 Comments

Paul Krikman, Noted Prize-Winning Economist, announced today that economists have discovered that money is  the source of all wealth. “It was in front of us the whole time,” he said in a wide-ranging interview, “I don’t know how we didn’t realize it. It was it was right in front of our noses.”

When asked what the tipoff was that got him looking in the right place, he said, “I’m embarrassed to say it, but I couldn’t help but notice that the main difference between rich people and everyone else is that they have more money. That was the tipoff.

“Of course, this immediately led to a whole bunch of other obvious things,” he continued. “For instance, all we have to do to create wealth and prosperity is to print more money!”

“Why do people work? To make money. What is a Recession? Not enough money. What is Capitalism? Concentrating too much money in too few people’s hands. You see, this is easy. Don’t print that! We have to complicate things so that people will still pay pundits and economists like me.”

One reporter asked, “Isn’t wealth created by taking raw materials — concrete objects or knowledge — and building them into things that are more valuable than their constituent parts?”

“That’s old-fashioned thinking,” Dr. Krikman replied. “That’s so analog and 20th Century. We’re in the digital age. We create value by doing cool stuff. Then the money just materializes. We call it ‘monetizing our site.’ What could be cooler than printing money? It’s so pretty, especially the redesigned bills. Very impressive. They even feel valuable!”

“But what about the people who will say that it’s just paper?” He drew himself up out of his slouch and puffed up his chest. His voice deepened. He scratched his beard and put on the earnest face he’d practiced so much. “It’s guaranteed by the Full Faith And Credit Of the United States Of America!” “Guaranteed?” reporters asked. “Yes, if some ignorant people were to lose faith in it, we would print more.”

“Besides, we don’t have to only print it. We can take it away from those rich people who have much more of it than they deserve, more than they can ever use. The myth that they’ve earned it and it’s theirs is nonsense. In most cases, their grandparents earned it. It’s only money. They’ll continue to make more of it. They produce a lot of stuff. That’s what productive people do. They produce. They can’t help it. Their greed drives them. That’s why we call them Greedy Capitalists. Besides, taking money from them makes the rest of the people feel good. We’ll make them feel even better by calling it Social Justice, or Redistribution of Wealth. Robin Hood had no PR savvy: he talked about robbing the rich. Talk about highway robbery just gets fair-minded people upset. Better to call it “redistribution” or “justice.”

“If you will indulge me for a moment, let me tell you an interesting story. In the old days, people used to practice division of labor. They’d get good at what they liked to do, then trade stuff they made for stuff that other people made. So, the baker would trade loaves of bread for vegetables the farmer grew, or for a haircut, or for drinks or other unmentionables at the saloon. They called it trading or barter. How quaint. That was before the internet.

“But it was hard to carry around a lot of loves of bread, and not everybody needed a haircut. They found that it was much more convenient to take the stuff they made and trade it for some interim stuff that everybody valued and that was easy to carry around. After trying salt, butter, chickens, beads, pretty stones and some other stuff, they found that gold and silver was durable, divisible, combinable, portable, had a stable supply and was hard to counterfeit. So it was a pretty good intermediary.

“They called it a “medium of exchange” — Cash or Money for short. They pressed it into coins because lumps of it wore holes in their britches, were difficult to count and easy to cheat with. Even coins were sometimes inconvenient to carry and store, so they had some of their more trusted people, called trusts or banks — whose stock in trade was trust in their word — hold their coins and issue receipts that substituted temporarily for the coins, but were easily exchangeable back into the silver and gold coins. In the US we called these dollars, but every country had their own. They became very decorative and a great source of pride. Each bank issued its own, guaranteed only by the demonstrated track record that its issuers would cash it back for what they called Coin or face some pretty stringent fraud laws. Trusts would even loan out some of this money for a fee. Sometimes, they could even loan out a little more than they had because not everyone would want to redeem their receipts at the same time. If word got out that they loaned out more than they could redeem in Coin, people would lose confidence in them and everyone would run to the bank to withdraw their money. They called it a ‘run on the bank.’

“To protect their citizens, and to engage in some cheating — I mean ‘monetary policy’ — of their own, some countries formed central banks owned by the government, to print money so they could spend more than they had. But our Thomas Jefferson was a wiseass. He had this quaint old notion called individual rights. At the heart of it was the silly idea that people owned what they called “the fruits of their labor.” Property for short.

Tom said,

A private central bank issuing the public currency is a greater menace to the liberties of the people than a standing army…We must not let our rulers load us with perpetual debt.”

The central bank is an institution of the most deadly hostility existing against the Principles and form of our Constitution. I am an Enemy to all banks discounting bills or notes for anything but Coin. If the American People allow private banks to control the issuance of their currency, first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the People of all their Property until their Children will wake up homeless on the continent their Fathers conquered.

“How silly,” Dr. Krikman opined. “Tom didn’t know what he was talking about. Nowadays, if we want to be wealthy, all we have to do is print money, or borrow it from our neighbors or from our children through national debt.”

“Won’t people eventually catch on that it’s a fraud, an illusion, and refuse to accept it, or keep raising their prices?” we asked.

“All we have to do is pass a ‘legal tender law’ that requires that our money be accepted be accepted for all debts, public or private, and print it right on the money. That makes it illegal to write contracts payable only in gold or silver.”

“It used to be called ‘fiat money,’ but that’s an old-fashioned term that shouldn’t be used anymore because all fiat money, first invented in the Song Dynasty in 1000 AD, for 1000 years have collapsed, usually in hyperinflation.” (He was a bit of a show-off.)

“Instead, we’ll call it ‘monitory policy’ or ‘flexibility’ or ‘deficit spending.’ It will allow government to spend more than it takes in, and give people the illusion that their elected officials are giving them services they don’t have to pay for, guaranteeing their reelection. Even the politicians who know it’s wrong will vote for this when it preserves their jobs.

“We’ll allow banks to lend out 10-40 times what they hold in these unbacked dollars, so that they can further create the illusion of prosperity. If the bubble bursts, we’ll blame in on the financial institutions who were so irresponsible for using the leverage we required them to use. If anyone calls it legalized cheating, we’ll call them ideologues.”

“In the meantime, prices will gradually creep up, since we keep printing more dollars. Remember our new discovery: dollars are wealth. So, as prices rise, things like our houses are becoming more valuable, we are making more wages and we are wealthier because we have more dollars. The stock market will rise dramatically. There are more and more millionaires. It’s like a gigantic magic illusion. No one will realize that gold, their houses or even their bank accounts aren’t growing and getting more valuable, the dollar is shrinking, so prices go up and things look like they are worth more.”

“If someone calls this an illusion, or even a fraud, we’ll say it’s treasonous talk from the right-wing loons. If they start a movement or a party to oppose government spending, printing of money, fiscal irresponsibility, national debt and the like, remember that these people are bound to be independent thinkers. They are bound to have some radical ideas that sound crazy and some people who are genuine nuts. Just seize on these genuine crazies and use them to marginalize the serious questions being raised.”

“Also, the lack of fiscal discipline caused by printing money will cause periodic crises. We can use every crisis to claim that the sky is falling. No one can prove that the sky isn’t falling. We can say that we haven’t spent enough, borrowed enough and regulated enough, and that have fallen victims to the greedy villains who have taken advantage of us. In fact, let’s use the slogan, ‘Never let a crisis go to waste.”

“If our policies and action fail, we can always say we didn’t do enough of whatever it was that failed: not enough stimulus, not enough spending, not enough regulation, not enough taxes.”

“If we fall into a severe recession or depression, we can always create more wealth by creating more money, which is the same thing. Let’s call it a ‘stimulus package.’”

“If people save gold and silver, we can always confiscate it from them like Roosevelt did in 1933. The laws that allowed him to do it are still on the books.”

“We’ll call it Hoarding and make savings unsavory by calling it unproductive.”

“Anyway, now that the government has taken over issuing money from the banks, when it needs more money and people balk at more taxes or borrowing, all we have to do is print it.”

Remember:

  1. Money equals Wealth. Mock anyone who asks where wealth comes from.
  2. The way to stimulate an economy is to, well, stimulate it. Duh! If people and businesses won’t, the government has to, or the sky will fall. Duh!
  3. If the stimulus doesn’t work, we will just say we didn’t do it big enough — the opposing party wouldn’t let us. We can say that if we hadn’t, the sky would have fallen, that we saved [fill in any number here] jobs, etc.
  4. Keynes was right. Roosevelt spent us out of our Great Depression. Capitalists are greedy evildoers; just look at our well-connected, government protected bankers and other financial institutions. No one is actually going to study these things. Economics is too complicated for anyone to understand.
  5. Keep repeating: Economics is beyond human comprehension; that’s why it must be left up to Congress.
  6. “There’s no such thing as a free lunch” is so retro and analogue. Of course there is: It’s free if I eat your lunch. You’re too fat anyway. I’m doing you a favor.
  7. We’re safe, now that we’ve eliminated the old boom-and-bust cycles. Hide all graphs that show that the old ones were not as severe as the newer ones. While we’re at it, hide all graphs that show the purchasing power of gold, silver and dollars, like the purchase price of the average American House, in gold vs. dollars. They will show what really fluctuates. Wait a minute. In the Digital Age, we can’t hide information. So make the graphs so complex that nobody understands them. Keep quoting Keynes. Nobody is going to slog through his dense gibberish subtly nuanced writing.
  8. Keep wrapping the Federal Reserve in mystery. We all know that it couldn’t operate under the light of day. We can trust it because it’s a government-protected private corporation that’s entitled to manipulate our money in private. We know that transparency leads to nakedness. And we all know what nakedness leads to.
  9. But, keep calling for greater transparency for Wall Street.
  10. Freedom causes chaos. Chaos causes anarchy. What we need is total control. They will scream “Socialism, Fascism, Nazism.” That’s what we want. Dismiss them as name-callers. Don’t ever ask what they mean. They’re not as socially savvy as we are, so they’ll keep using the inflammatory words like “socialism and fascism” instead of just using the phrase ‘total governmental control.’ The search for clarity can lead to dictionaries. Dictionaries  lead to definitions. And, we all know that definitions are arbitrary, make us look pedantic, and lead to headaches. Jeering and mocking makes us look flamboyant and hip. Spouting precise definitions makes us look boring. In the world of infotainment, who do you think will win?
  11. Let’s not have a serious discussion about new things that are now possible in the digital age: whether there is an alternative to government control vs. roving gangs of thugs and where does wealth really come from. What is money? Is central governmental regulation even possible as presently conceived? Is there a better way?

OK, enough satire. I think you can see what a persuasive and powerful tactic it can be.

Without it, the following questions would fall flat:

Where is the serious discussion? Where is the mutual respect? Why so much mockery, ridicule and sarcasm? Since when has name-calling replaced problem-solving, mutual exploration, rational fact-finding and creative idea generation? Why are we debating past history when the world has totally changed? Where are the new ideas and incisive questions?

Why are we having a debate about whether we need to do more of what isn’t working vs. going back to what we did in the past that also didn’t work?

Why is bipartisanship so desirable when both parties are obviously wrong? Why in the middle always right? What if there is an altogether different way that isn’t on the continuum?

Why aren’t we asking, “Where are all these new problems coming from and how can we use our amazing new capabilities to solve them in new ways?”

Can we please have a serious exploration of new ideas in which it’s OK to say, “I don’t know, but let’s figure it out together”

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