Tuesday, November 29, 2011

Herman Cain: Good Brand, Wrong Business

If Newt Gingrich is going to win the nomination, and possibly the election, it is because he is the right brand in the right place at the right time. He is experienced, knowledgeable, politically savvy, positive, business-oriented, and most of all he really seems to want the job. Plus he's already gotten us used to his skeletons.

The country is looking for answers. And they see in him a confident old hand with substantive new ideas that can actually work.

Herman Cain on the other hand is very uncomfortable in his current chosen field, politics. He likes people, clearly (perhaps a bit too much!) but he doesn't know the subject matter. And he isn't skilled at working the issues, the Washington scene, the media. I find myself wondering why Cain hasn't dropped out yet. It's not just the allegations from the (lost count) women who have emerged. It's the fact that he just seems so uncomfortable with any serious question whatsoever.

Cain has said that he's studied leadership, and that a president should be a "Communicator In Chief." (If he is lying about the women he is the best liar I have ever seen.) He likes solving problems with simple, straightforward formulas that appeal to the average person. He relates well generally to Jane and Joe Public - and seems uncomfortable with elites of any kind.

In many ways Cain resembles Sarah Palin, and he could lift a lyric from her song sheet. Sarah is beloved by her fans (I am one), dismissed as a lightweight by her foes (because of the occasional flub), has gone through family scandal and ultimately bypassed official channels to relate directly to the people. She still uses her voice, but in a way that people will better accept - and she doesn't shy away from the truth.

Cain should follow in Palin's footsteps. Womanizing politicians are old news by now - and he has nothing to lose by admitting this proclivity, if it exists. America is a forgiving nation because we embrace the Judaeo-Christian ethic of sin and forgiveness. It is impossible to live and not screw up; what we hate are the people who try and lie about it.

If I were Herman Cain I would do 5 things right now:

1. Fire the lawyer and the communications adviser, who make him look bad again and again

2. Get on TV with his wife to admit that the allegations are dragging their family and the party down, that he is sorry for all this (whether he did anything or not), and that he is seeking therapy to better understand his issues

3. Keep a detailed journal of this time in his life, so that someone can help him write a recovery book later

4. Publish book, which should include a chapter on his issues with women, and on the book tour include a component where he makes peace with those he has harmed and joins an organization promoting more positive values in any area that would be appropriate 5. Join the media in some capacity as a "rehabilitated" public figure with many important things to say - maintaining a strong presence on the lecture circuit, etc.

In the world of branding there is only one moral law: Keep your promises. And if you have broken them, make them right, right quick.

Have a good day everyone, and good luck!

(Note: This blog is a communications commentary, not a political endorsement.)

Sent from my iPhone

Gender-Based Branding: 5 Hypotheses

The other day it occurred to me that while marketers routinely differentiate between men and women as target audiences, brand strategies don't often make this distinction.

In this context "marketing" = meeting customer needs in the broadest sense, while "branding" = creating the impression of superior value.

Here are some loose hypotheses I'm tossing around:

1. Visual vs. imagination - men need to see what they are buying (inspect dimensions, etc.) women prefer to embellish it in their heads
(Related hypothesis could be called "explicit vs. storytelling": men prefer to be told directly and concisely what the product is and does vs. women like to learn about it in the context of a story, by inference, etc. - like product placement or infomercial)

2. Specialized vs. lifestyle - men prefer a brand that claims to do one thing well; women like an umbrella brand that brightens everything it touches (Dr. Oz vs. Oprah)

3. Functional vs. emotional - men are more likely to care about objectively provable quality whereas women care more about brands that evoke a specific feeling

4. Ownership vs. experience - men prefer brands that offer the experience of control vs. women gravitate to brands that control the experience for them

5. Admirer vs. object of admiration - men gravitate to brands they can polish, clean, and admire vs. women gravitate to brands that put them at the center of attention

I'm wondering if anyone agrees, disagrees, or has other dimensions of brand-based value creation that may differ along gender lines. (For example, are certain colors, or color families, more effective by gender? Do customers respond to corporate social responsibility promises based on gender?)

Note that I'm not trying to be prescriptive or sexist here, but rather to offer some concepts based loosely on my own observations. Welcoming everyone's thoughts and comments.

Thanks everyone, have a good day and good luck!

Monday, November 28, 2011

Occupy Wall Street, Branding Battleground



Originally OWS was an anti-consumerist movement (see "The Branding of the Occupy Movement" in today's New York Times, 11/28/11; hat tip to whoever posted it on LinkedIn.) It was "launched" on July 13, 2011 when the staff at Adbuster magazine, headed by editor Kalle Lasn, launched a dual branding and social media "attack" as represented by:

* Twitter hashtag: #OCCUPYWALLSTREET

* Icon: Ballerina dancing on a bull


Unions and liberal groups have been visible promoters of the movement; a recent headline in The Hill (11/12/11), "Labor unions, Occupy Wall Street plan ‘day of action’" exemplifies its initial ideological tilt.


The New York Times exemplified the “capitalists are evil” spirit yesterday (11/27/11), with a cover story casting billionaire Ronald S. Lauder as someone who can’t actually succeed at working for a living, so he is content to be a semi-productive philanthropist, art lover and sometime ambassador who is an expert in milking legitimate tax shelters for all they're worth (insert anti-Semitic stereotype here of the unproductive, secretive sponger-off-society).


The great and the terrible thing about marketers is that we don’t care if you hate us or not – we just want to sell to you. So it was bound to be a very short time before pro-consumerists (capitalists) tried to co-opt the very movement launched against them (us).


Thus an article, "Who's Behind '99 percenters'?" (WorldNetDaily 11/22/11), arguing that we brand people have indeed infiltrated the ranks. It asserts that "a company hired to lead marketing campaigns for such corporate giants as Pepsi, Starbucks, IBM and Toyota now is promoting Occupy Wall Street while [paradoxically] complaining about the top "1 percent" ultra-wealthy allegedly hoarding the country's wealth."


And an op-ed in today's USA Today (11/28/11), "How Businesses Can Pacify 'Occupiers," purports to explain how companies can use the power of their brands precisely to keep the figurative mob on their side. From the article:


"Businesses can be beloved, even when they generate huge profits and create great wealth for their executives. Just look at Apple, Google, Disney, or Johnson & Johnson. Nobody is occupying these companies' headquarters, even though these firms make a lot of money.


“What's different about these companies is that they create value for consumers that resonates with both the head and the heart. They infuse their business with purpose and meaning that transcends profit. They focus on feelings, not just fees."


OWS is a social movement; social movements redefine norms; normal is what we make it.


We are only seeing the beginning of its impact, but in the end it will be the 99% who decide what it means.


In the end, will OWS become just another moneymaking enterprise, or will it be a vehicle through which we fundamentally simplify our lives, and stop letting consumerism define us?


Given all the writing being done about holiday sales, in a time when many can't afford to buy much at all, I hope it is the latter.


Have a good day everyone, and good luck!


Image source here

Sunday, November 27, 2011

Personal Demon --> Personal Brand

I did not understand Lady Gaga at all until I saw her HBO concert special. Onstage she talked – a lot. And I could see that growing up, she felt like a freak. That gender and sexuality were big issues for her. And that she lived, dreamed, ate and breathed the wish for stardom.

Now she is a star – we pay her to be a freak for money – because she encourages the rest of us to let our own “freak flag fly.”

Watching her onstage I thought the following: Lady Gaga is “freaking” brilliant. She can sing. Dance. Play piano. Change costumes in five seconds. Has no shame or inhibitions. Remembers her entire stage show. Can run through the whole routine breathlessly.

Plus Lady Gaga knows how to capture the audience, engage them, bring them in. The concert was in New York and I think she yelled “New York” just about every five seconds. She gave a shout-out to Liza Minnelli and Marisa Tomei in the audience, and to the Tisch School at NYU (the performing arts school). This was not an anonymous endeavor – Lady Gaga completely bonded with her “little monsters” at her very own “monster ball.”

Another example: Look at Woody Allen. You either love his films or you hate them. But they have a definite style – a signature brand. All of it comes from his personal demons. The storylines, the themes, repeat again and again. And he has managed to reinvent that wheel for decades.

Or how about Kim Kardashian? What is it that makes her reveal so very much to the world? Why does she not only show her physical self but also the very inside of her emotions, to the point where she goes through courtship, marriage and divorce on TV? Whether you like her or believe in her or not, or whether her brand will work in the end, she is clearly driven by a personal demon. And it will not let her go.

Take Charlie Sheen. His personal demon propelled his career and the incredible success of the sitcom Two and a Half Men. Nobody could make up a character like that, because the character of Charlie is Charlie. And as self-destructive as he is – as much as the personal demon has won, at times – the brand remains an objective contribution to the world of Hollywood entertainment.

When you seek to build a personal brand there is no reason to look outside yourself. Whatever it is that drives you now, that is what you need to use. Because nobody has lived through your life and experiences.

Think of it this way: Considering all the uniqueness that you've gained from your personal pain, why work so hard to think of a good personal brand? Use it instead to propel yourself forward. Do something constructive with everything you've lived through. It's something nobody else can match.

Just don’t go too far – keep a bit of distance – control the demons and don’t let them eat you alive.

Have a good day everyone, and good luck!

Friday, November 25, 2011

Branding as a tool to reinvent government

One of the things I have never understood about "nation-branding" is its use for tourism. It seems to me one of those cancerous outgrowths of thinking of branding in a very limited, superficial, advertising-campaign-like way with a very short-term return on investment if there is one at all.

In fact, this kind of activity isn't branding. It is really marketing, supported by advertising. Here's the difference:

* Marketing is always focused on what the customer wants. This is classic Peter Drucker: "You get paid for creating a customer, which is marketing." Marketers think in the short-term: Campaigns are for right now and they are best measured in sales.

* Branding is always focused on keeping a promise. If you're doing your job right you will draw some customers in and turn other prospects off completely.

Marketing and branding are both tactics and they're appropriate at different places and ties. But when it comes to something as weighty as nation-branding, marketing is inappropriate as a tool. If you could somehow market a tourist attraction and divert the customer's attention from the nation's politics and policies, it would be one thing. But you can't: People read the news and have opinions and to pretend that you can visit a historic landmark without being conscious of weightier issues is just foolish. The reality is that government has policies and takes actions that are popular among some, but not everybody.

So the better tool for promoting a nation is the use of branding, specifically by making a promise that is relevant and differentiated; making people aware of that promise; and then keeping it. The promise is then carried out by architecting government politics, policy and operations on the ground.

Sometimes when I talk about this with people I hear the concern that branding is propaganda and that therefore the government (meaning the U.S. government) shouldn't do it. Well I suppose if you are using the term to mean self-promotional advertising then you have a point. But if you are using branding in a real way - not like an ad campaign but as a business strategy with the fundamental power to reshape the entity itself - then it is not propaganda at all but rather the greatest accountability and transparency tool there is.

Used properly, branding has the potential to actually reinvent government in at least 5 ways that would have a positive trickle-down effect:

1. Promoting strategic thinking: Branding involves making a long-term decision about what the promise is and whether it is actionable or not.

2. Promoting objective metrics of success: A brand promise can be reduced to key performance indicators, measurable as metrics, that enable the public to see whether forward movement has occurred.

3. Promoting change: Based on metrics, change has to happen to make the promise real and better serve the customer. One of the most important changes government can make is to operate from the perspective of the customer even if it feels unfamiliar or inconvenient to do so.

4. Promoting transparency: A promise made is a promise that has to be kept, and the audience wants to see that for themselves.

5. Promoting accountability: When a promise is broken, the customer demands that someone takes responsibility, or a key aspect of the brand - its reputation - suffers or is shattered.

The catch with all this, of course, is that branding means some audiences are going to like what the government does while others are bound to hate it. But trying to make everybody happy - taking a marketing approach - isn't doable in this context.

There are some who would demonize branding as a tool of the rich to make themselves richer. But you could demonize any powerful tool by focusing on its potentially negative impact. Rather than focusing on its destructive aspects, it is smart to take advantage of the enormous benefits it can bring to any individual or enterprise - and use them well.

From where I sit, making a promise and then keeping it - or doing your damndest to try - is a very good thing.

Have a good day everyone, and good luck!

Thursday, November 24, 2011

Thanksgiving & the importance of ritual in brand-building

Of all the books written about branding one of my favorites is Primal Branding by Patrick Hanlon of Thinktopia. In this book Hanlon lays out the principles of great branding essentially along the lines of religion. 

Among the principles that Hanlon lays out is one I think gets overlooked a lot - ritual. Jeannie Chan at the Curious Marketeer explains it thus: "Rituals are the meaningful repeated points of contact between you and your guest, customer, client, or target market." Certainly that is one aspect of ritual - the way the brand developer shapes your experience consistently.

But there is another aspect to ritual as well. As a brand-builder you are trying to create a destination for the customer that is an essential part of their lives. The fact that they keep coming to you, and not your competitor, is what guarantees you a steady stream of income and the opportunity to build and expand your presence in the market.

So what you want is to have the customer's patronage of your brand be a ritual in itself.

Starbucks understands this brilliantly of course. Thus the flock of penguins going to work every day with the obligatory paper cup in hand. Evidence: You say, "I'm going to do a Starbucks run" rather than "a coffee run."

Google understands this too. By hitting their search page before you do anything else on the web, you have absorbed their brand into your life so much that it almost becomes unthinkable to use the web without them. Evidence: You say "I'll Google that" rather than "I'll look that up."

Or think about Band-Aids. The product is almost inseparable from the image of a caring mother kneeling before her child's scraped knee. The ritual occurs as the child runs to Mommy, Daddy or caregiver and receives love - in the form of a Band-Aid being applied to the cut.

Finally, there is Thanksgiving. The buying, roasting and preparation of the turkey and Thanksgiving meal is a ritual; brands vie to be the ones who "own" that particular mindspace. I would venture to guess that Martha Stewart owns the holiday right now. And the other ritual associated with this holiday, of racing to the stores on "Black Friday," means retailers can count on lots of business - even from people who don't need a $9.99 coffeemaker from Macy's.

Branding is an art and a science, but in the real world what ultimately counts are dollars and cents. To build a fantastic brand, it's critical to pay attention to ritual. How can you distinguish your product or service today?

Here's what I say to end my blogs: "Have a good day (or evening), and good luck!"

Jimmy Fallon's Fake Apology & 10 Do's and Don'ts Re: Twitter

As a guest on Jimmy Fallon's late-night show, Presidential candidate Michelle Bachmann was greeted by a song that essentially called her a b****. It was shockingly rude and not funny. Fallon reportedly has tweeted an "apology." That seems cowardly to me.

If you want to call someone a bad name, do it to their face; don't hide behind your band. And when you're called out on bad behavior like this, apologize personally, either over the phone or in person. 

So please don't do that and these 5 other things on Twitter:

1. Tell us where you are, what you're eating, etc.

2. Write in Morse code

3. Promote companies who blindly ask everyone to send Tweets promoting their services

4. Over-Tweet (more than 4-5 in a 24-hour period)

5. Share links that look like they might be spam - word the Tweet so that we know you haven't been hacked

On the other side of the coin, please do use Twitter to:

1. Share news

2. Tell about a blog you've written or a project you're involved in

3. Comment on anything

4. Inspire with a quote

5. Thank a fellow Twitterer for a retweet

Great communication is all about matching the meaning to the medium - and Twitter is no different than anything else. When you want to share information or a brief thank-you, electronic is fine; but when it's something that really matters, face-to-face or voice-to-voice is critical.

Have a good day everyone, and good luck!

Wednesday, November 23, 2011

Precisely **Because** of Its "Muddled Message," OWS = Valuable Brand

According to USA Today, 56% of Americans “neither support or oppose” OWS because “they still don’t know enough about its goals.”


Technically, as a brand OWS should fail. It’s got a negative, messy, incoherent message; it’s socially engineered; and its “ambassadors” violate some basic American values, not to mention the law.


Yet OWS is valuable and destined to make a difference anyway. Because it’s got all four of the requirements for success: 1) awareness 2) esteem (among a very specific target audience) 3) differentiation and 4) relevance (methodology: Young & Rubicam’s Brand Asset Valuator).


Esteem and relevance are where OWS go off the charts for Generation Y: This is their Woodstock. Remember: This is the generation told that they deserved everything, if only they worked hard enough and followed the rules. That believed in “hope” and “change.” And that now finds itself royally cheated out of everything they worked for.


Generation Y isn’t being drafted into war. But they are furious anyway. Because the “brand promise” they bought into – that they were inherently deserving winners, and that America would reward them amply for trying their best – now looks to them like a big, fat lie. And somebody is going to pay.


Look at 28-year-old Steve Ferdman, who “occupied” the cover of yesterday’s New York Times business section. Just a few months ago, he dined over “expensive oysters and dark rum cocktails” with his parents to celebrate being hired by Credit Suisse. After six months, consulting, no benefits.


One week later he was laid off. For the second time. By the same firm.


To Ferdman, it felt like a physical blow: “I did everything right. I came into work every day, I put in long hours, and I still got punched in the face.”


The Times notes that younger workers have been disproportionately affected by the investment community’s financial woes. There has been a 25% decline in the number of 20-34-year-olds employed by investment banks and brokerage firms over the past 3 years (110,000 jobs) versus 17% across the board.


Waiting for things to get better isn’t going to work – and it is likely that these young adults know it. One recruiter stated: “A lot of the positions that are being cut right now aren’t coming back.” (Kevin Roose, “A Blow to Pinstripe Aspirations,” The New York Times, 11/22/11)


Adding insult to injury is the sense of entitlement of this generation. The price they paid for a lifetime of being controlled and coached was an endless series of coochie-coos and congratulations and certificates. Their “Tiger Moms” trained them to win and taught them they were “worth it.” As a result, Gen Y entered the workplace expecting a serious amount of recognition and reward where other generations were simply grateful to have a paycheck.


One article posted by CNN, “Generation Y: Too Demanding at Work?” sums up the generation gap at work: “Employers don’t understand why twentysomethings straight out of college expect a high salary and lots of vacation time.”


Employers’ surprise and dismay at Gen Y work attitudes is founded not in snobbery but rather the expressed expectations of the group themselves: They expect “more benefits and other perks than their older counterparts.....better pay, a flexible work schedule and company-provided Blackberrys and cell phones.” (Anthony Balderrama for CNN Living, 12/27/07)


In many ways, Gen Yers are similar to Baby Boomers. Both generations feel deserving and yet both are expansive and generous in their sense that everyone else is entitled too. Both are team-oriented and idealistic. Both gravitate toward politically correct and socially “progressive” theory and ideology that sounds good in the abstract, but that is difficult to explain in its particulars.


In any case, the Gen Yers are out of graduate school now, and they’ve kept their noses clean, and now they have zero to show for it. Worse, many of the have to live with their parents (!) From that vantage point, living in Zuccotti park with all their friends has a certain romantic feel to it.


As far as the message being muddled, that may in the end turn out to be OWS’ biggest rallying point. By defying any sort of pigeonhole, OWS is open to anyone who has an axe to grind. And if I were a young person who’d spent the last twenty years of my life cramming for exams, I’d be pretty inclined to demonstrate if the best career prospect I had going was a barista job at Starbucks. If I were lucky.


OWS is going to succeed, because the brand promise of hope and change has left young people deeply disappointed. When you are bred to be a prince (or princess), and then live the life of a figurative serf, you’ve already gone from one extreme to another.


In short, OWS gives voice to the fury of a generation. And that is why whoever can own it, and lead it, is going to have a very powerful social tool in their hands. Not to mention a brand.


May God have mercy on all of us as we face the difficult challenges of our time. To Gen Y and all of us - have a good day, and good luck.

Tuesday, November 22, 2011

Why your boss doesn't like your personal brand

You have a blog, a Twitter account, you're active on LinkedIn and
you've even presented a case study at a conference or two.

Maybe your resume looks better but is all this extra work impressing your boss?

According to personal branding specialist Dan Schawbel, the answer is
no. In "The Perils of Self-Promotion" (Forbes 11/15/11) he warns
excessive Twitterers and the build-your-brand bloggerati about the
risk of "alienating your boss with your overzealous self-promotion."

Paradoxically, too much personal branding can actually screw up your job!

In the article, Schawbel and other experts offer 3 good basic tips to
help eager career-builders avoid this fate:

1. Build your brand on your own time, but make sure to keep your boss informed

2. The 80/20 rule still rules: Spend most of your time on your job
and work relationships, and only after that, your brand
(Steve Cannon, VP marketing, Mercedes-Benz USA)

3. A similar rule regarding personal brand activity (70/30): keep most
of your content useful (information or entertainment) and only then
indulge in self-promotion.
(Shama Kabani, author, the Zen of Social Media Marketing)

The bottom line, whether you're balancing a job and a personal brand
or just self-employed and looking to build your business online, is
that self-promotion is a turnoff. Focus on the work and the
relationships in whatever environment you're in and it should be fine.

Have a good day everyone, and good luck!

Saturday, November 19, 2011

The Hidden Similarity Between Occupy Wall Street and The Tea Party - And What It Reveals About The Way Forward

In a column posted at Forbes yesterday, Adam Hartung compares the relative importance of the Tea Party with Occupy Wall Street:

* The Tea Party is more organized than OWS, and has a clearer message.

* OWS draws a more diverse and less extreme crowd than the Tea Party and its members are growing.

He concludes that OWS is more important than the Tea Party: it "looks like a trend, even if we don't know exactly what that trend represents." One thing he can say:

"The OWS people are genuinely angry. They cannot comprehend why America cannot seem to create more jobs, or provide affordable health care for its citizenry, or even deal effectively with wave after wave of property value declines and foreclosures while those at the top of the economic pyramid seem to keep doing better every year."

On the surface the two movements differ because of who they blame for their problems: Tea Partiers say it's "Big Government"; OWS call out "the 1%," which is a veiled reference to capitalism, or Big Business (corporations).

Actually the concern is neither government or business alone - it is the rise of the nameless, faceless bureaucracy that is the problem, and its supremacy now over the individual.

Think about it: Both Big Business and Big Government promised salvation, both failed to do so, and yet we can't think of any better system. The result is a combination of social forces that threaten to destroy the individual from two directions at once: both suppressing individual freedom and removing the social protections we once took for granted. 

Here are some examples of what Big Business and Big Government have in common, from the perspective of the average person:

1. Each in its way has historically provided for the welfare of the individual, prompting the individual to give up certain rights and freedoms for the sake of economic survival and protection. We trusted them, but the promise is disappearing, and leaders seem helpless to reverse the trend.

2. Each is interlinked with the other, mutually reinforcing. Government depends on business for revenue, and business depends on government for favorable operating conditions. But the individual who challenges one, the other or both stands little chance of success under ordinary circumstances.

3. Each is a large bureaucracy, similar to Big Education, Big Religion, Big Technology, Big Law, Big Athletics, Big Healthcare, and so on. As such they are set up to promote their own hierarchies and their own survival even at the expense of the individual.

4. Each governs much of the individual's life, and the yet individual has little visibility into how they operate. However, the growth of the Internet and social media has led the individual to challenge what was formerly accepted with little question.

5. Each is increasingly intruding into the private life of the individual with the aid of technology, and there is little way for the average person to live their life "off the grid."

Social movements are neither good or bad, but evidence of an imbalance that society recognizes and seeks to correct. Looking at OWS and the Tea Party in a splintered way obscures the unity that underlies their distinct messages. 

Rather than wasting time trying to parse which is better or worse, or more important or less important, it would be useful to find the commonality between them. The most obvious of these, to me, is the individual feeling of helplessness in the face of the social machine. The corrective to disempowerment is obviously power. The task at hand is to restore the freedom and the dignity of the individual. 

In short, we need to go back to the day when everybody felt they could have a plot of land to call their own, if only they worked hard enough. If we do not, it's a certainty that the disenfranchised will simply camp out in the park - and begin to occupy others' property as their own, a devastating consequence for us all. 

What I'm hoping is that the people who have enough energy to take to the streets now use that energy to organize further, enabling our society to transcend an over-dependence on abstract "leaders" and move toward a greater sense of personal responsibility. It doesn't matter anymore who got us into this mess or how; what matters now is that we get ourselves out.

Have a good evening everyone, and good luck!

Friday, November 18, 2011

15 Branding Trends We Will Trace to Penn State

Possibly 30+ years of pedophilia, carried out by a trusted football coach named Jerry Sandusky, who set up a charity to lure his victims. The coach enabled and protected by Penn State's church of football, with the Pope-like figure of Joe Paterno at the helm. Eight victims so far and more are coming forward.

Now at Syracuse University, associate head basketball coach Bernie Fine (pedophiles know all religions and no religion) has been placed on leave after two alleged victims have stepped forward. The police have opened an investigation regarding allegations of sexual abuse by him spanning from the 1970s to the 1990s.

Back to Penn State. The image of a helpless ten-year-old boy being raped by a powerful and trusted community figure, observed but not protected by a 30-year-old man who could have intervened but inexplicably failed to physically intervene, is so horrifying that there literally are no adequate words. At CNN, Bill Bennett says it's the "worst scandal in the history of college football." The New York Times' Michael Bérubé calls it "the worst scandal in the history of college athletics."

Bennett and Bérubé aren't going far enough. Penn State is the worst child abuse scandal in the history of the United States. It is going to be remembered as the turning point for children's rights in this country. The Arab Spring, Occupy Wall Street, and now the beginning of the Children's Rights Movement. We are bearing witness to moment when this movement will take root in a serious way.

Sociologically speaking, this scandal is so bad because the culture's dominant groups are affected:
  • Gender: Sexual abuse of girls is rampant and 25% of American women take psychiatric drugs for a "mental disorder." Can it be a coincidence that 15-25% of women are estimated to have been sexually abused as children? But it seems that the abuse of boys, coming now out of the closet, is somehow seen as worse.
  • Class and race: Penn State students were 75% Caucasian as of Fall 2010 and costs about $45,000 a year for out-of-state dorm students. While the victims' identities are unknown, the alleged perpetrators and those who covered for them were (previously) considered "the very best" of what America had to offer. (Obviously this is classist, racist and ridiculous.) As one commenter put it, referring to Penn State months before the scandal broke: "To these Universities, to their turned-up-nose administration teams, and to the their majority of smug living-in-a-bubble, highly tenured, untouchable professors...to THEM may we send out a collective, very heart-felt C' MON MAN !!"

Because of Penn State, Generation Y - which was, after all, raised by Generation X "helicopter parents" - is going to become the most suspicious generation of parents ever. And they are well-equipped with social organizing skills, social media technology, and the willingness to use both.

For brands this is going to mean:

1. The end of Penn State as a brand. Even though the academic side was not involved, they are permanently tarnished. If the school does not close down, it will have to change its name.

2. The end of athletics as the basis of a college brand - schools will have to focus on education first

3. When athletic programs are used as selling points, they will have to emphasize diversity, inclusion, respect, fairness, transparency, and accountability.

4. We will likely see a national brand of daycare facilities that are built into the workplace in a modular fashion - offered as an "ingredient brand" benefit by top employers. (Conversely, telecommuting will go even more mainstream.)

5. An opportunity to capitalize on the growing integration of children in adult life, first through daycare facilities at work, then through homeschooling and unpaid internships accepted for high school credit

6. The mainstreaming of homeschooling - with issues of sexual abuse and bullying at the forefront today, and the advent of distance learning technology, homeschooling will go from being "weird" and "non-credible" to being "standard" and even a sign of prestige, showing that children are self-directed achievers (we are already seeing this to some extent)

7. The growth of part-time teachers, childcare workers, etc. as people who seek such low-pay, low-prestige positions full-time not only face more stringent background checks and increased licensing requirements, but become socially stigmatized as possible pedophiles

8. Police or private security forces specifically dedicated to child welfare at school, not just metal detectors

9. The standardization of self-defense training for children in the public schools

10. An "Angie's List" type social network dedicated specifically to discussing people who work with and care for children

11. A colored bracelet or symbol for speaking out against child sexual abuse, together with a national 1-800 number for reporting suspected abuse

12. The end of "feminism" and the beginning of "humanism" as recognition grows that power-abusers are equal-opportunity; but a simultaneous emphasis on the male experience of abuse; a "Dr. Oz"-like figure who writes a pop-culture book and is anointed as an authoritative source on male recovery from sexual abuse

13. A brand of surveillance technologies for children - e.g. wrist monitors, pen cameras, cameras in shoes, jackets, hats, etc.

14. More broadly, the growth of interest-based coalitions as opposed to large institutional authorities, which will find themselves at the center of growing distrust and even disrespect

15. Even more broadly, with the death of trust in social institutions and an extremely challenging economy, the growth of self-help culture in every respect - from education, to work, to home repair, self-protection and community policing. (I call it "Lifehacker" culture, for the website Lifehacker.com.)

All of these developments center on a single question that continues to lack a satisfactory answer: "Why didn't anybody tell (when it happened)?"

The answer is, back in the "olden days," people perceived that their survival depended on not telling. They would be shunned, stigmatized, removed from their positions. "You just can't tell Jerry (Sandusky) no," one Penn State victim said. Even today, it is still very difficult for a victim to speak out: Just ask the women who alleged misconduct against Herman Cain what it feels like to have your entire reputation smeared against the wall.

In the future, survival will depend precisely on telling. The more vocal, transparent and organized you are, the larger your trust-based network, the higher your credibility and the better your chance of getting anything done. And so the revelations at this school and the reaction by the public mark a turning point in history.

At this point, from a branding/PR perspective, all organizations would be wise to take heed. What happened in Pennsylvania is going to have a domino effect on the rest of the country. Silence is no longer golden, either for perpetrators or their protectors. The victims have had it - and they are going to speak up.

Thursday, November 17, 2011

Social media in government: problem or opportunity?

It was only after his "nervous breakdown" in 1897 that the German sociologist Max Weber wrote one of the greatest social studies of all time: The Protestant Ethic and the Spirit of Capitalism. 

Weber had been felled by the "irrationalities" of his own mind and so he compensated by finding and celebrating the growth of orderliness in the modern world. As Elizabeth Kolbert puts it:

"With “The Protestant Ethic,” Weber seems to have discovered his calling: the study of rationality....In Weber’s view, modern Western society is the product of increasingly rational forms of organization. Its institutions are governed by “systematic” rules and “impersonal” procedures, rather than by custom or religious obligation, and this sets it apart from virtually all other world cultures." 

If there were a status called "sainthood" in the government today, Max Weber would probably occupy it. It was Weber who defined and elucidated bureaucracy, which - despite the fact that the word has a negative taint - we continue to practice today in government as axiomatic. 

Generally the characteristics are:
  1. "Formal hierarchy"
  2. "Management by rules"
  3. "Organization by functional specialty"
  4. "An 'up-focused' or 'in-focused' mission" (the organization serves either another organization or its own employees rather than the public)
  5. "Purposely impersonal"
  6. "Employment based on technical qualifications"
The "problem" a bureaucratic government faces when confronted by social media is the tendency of free-spoken individuals to shine a light on the institution itself. It is a social law that bureaucracies will seek to preserve themselves even if they are antiquated and failing, but in the absence of an astute and informed observer, the process of that decay can continue for a fairly long time before Rome crumbles.

Already in 1999 The Cluetrain Manifesto sounded the warning bell about the rise of social media, but at that time, relatively few were listening. Now in 2011, social media is the language of the masses.

If government can think strategically about social media and ride the wave of scrutiny that will increasingly come upon it, then the rational bureaucratic model has a strong chance of surviving - because people prefer the status quo to change, and because rationality trumps irrationality as a mode of organizing large-scale endeavors.

But to do this they would be wise to heed words like Douglas' Crets, who comments on his own question (in Quora), "What's the best way to super-size a b.s. idea?"

"Well, I think we have to start wth the premise that if you really believe in what you are doing, the idea better not be crap. Secondly, making something go viral is a canard, so let's do away with that. There, tossed. Thirdly, social media is about relationship management, relationship discovery and relationship reality. It is not about pushing out an idea for people to consume and then when they shit, they shit out golden coupons which they use to buy your product. This is an idea that I think was generated because advertising seemed to work." 

"...."ask" the consumer what he wants, not by offering it first, but by asking the consumer, how do you feel, what do you want done for you, what needs to happen in your life. and then the social media enthusiast needs to bust ass to help that person do that thing. 

"If you think that sounds like something you are willing to do, then I say, get off your ass and start doing that. Or, hire me, and I will do that for you."

Like bureaucracy, social media is a tool - neither good nor bad. It is what we do with it that lends meaning. But it cannot be used to "push" a message nor can it be ignored or even suppressed as an inconvenient-for-us voice.

Here's hoping that the bureaucracy engages with those who want to engage back in productive dialogue for the good of the people.

Have a good day everyone, and good luck!

Monday, November 14, 2011

10 Tips for Handling a Hostile Audience

This morning C-Span’s Book TV featured an Oct. 27 talk by Gilad Sharon, son of the former Israeli Prime Minister, Ariel Sharon. The former was in Boston at Suffolk University to talk about authoring his father's biography, Sharon: The Life of a Leader.

Following the lecture, Sharon participated in a Q&A with a mostly hostile audience. It was not surprising; the Middle East is a polarizing topic and Sharon is equally a polarizing figure. Despite this, and despite his personal stake in portraying his father well, Sharon handled the questions impressively. His handling of the situation left me with some important communication lessons about a key topic - because on-camera or not, all of us have to deal with hostile questions at one time or another:

  1. Be an expert in the subject matter, not just “well-prepared.” Sharon effortlessly reached back into decades of history to respond to every question fully, putting them into historical context. Lesson learned: If you don’t know what you’re talking about, don’t talk.
  2. Stay calm. The hostile question is designed to provoke you to lose control. When you fall into that trap you lack credibility no matter how accurate your answer is. The viewer/listener is saying to themselves, “If this person were right, they wouldn’t be so upset.”
  3. Show respect for the questioner. Even if you disagree or are offended, never trivialize what the person is saying. Being larger than the conflict shows the audience that you must be in the right, or again, you wouldn’t be so composed.
  4. Humanize your side of the story. When asked about Israel’s security measures, Sharon responded (paraphrasing), “You are young, you probably don’t have kids yet. But our children are being attacked in their yellow schoolbuses. We have to protect our chidren.”
  5. Know when to stand your ground. Where historical fact was at issue, Sharon simply said, “that is not true.” Period.
  6. Know when to agree to disagree. There was a point where a questioner accused Ariel Sharon of saying something outrageous, claiming that it was reported on Israeli radio. His son said flat-out, my father did not say that. They went back and forth a couple of times, then dropped it.
  7. Admit mistakes. Gilad Sharon said that Israel had made mistakes in the past and of course would do so again. He did not pretend that the country was perfect. Nobody is perfect.
  8. Be open to all questions. Sharon did not try to censor anyone. He simply answered.
  9. Ask questions of your own. At times, Sharon confronted people with questions of his own, questions that revealed logical inconsistencies in what they were saying. You have a microphone; use it.
  10. Know when to stop talking. Sharon did not try to dominate the microphone. He simply answered the question, then let it go.

As I write this I can’t help but think: We are so fortunate to live in a democracy, where we can use words instead of weapons to advance important goals. I don’t take free speech for granted at all. Here’s praying that we can find a way to think, write and talk our way out of the problems that face us all, and achieve lasting peace and prosperity for everyone around the world.

Sunday, November 13, 2011

Marketers: That Phoniness Will Cost You

This season on "Desperate Housewives," Susan is wracked with guilt because she helped her friends commit a crime. She tries to run away from the guilt by taking an art class and trying to win the teacher's approval there - except that the teacher is more than she bargained for. He won't let her simply get an "A" in the class and go home. Instead he sees her talent, and pushes her to cut through her own b.s. and paint the truth she is hiding inside.

The great thing about popular culture is that it helps us to see and confront serious issues that are often too upsetting to deal with in reality. Because just like Susan, a lot of us go around in a kind of hiding. We compensate for the inability to speak freely, to tell the truth as we see it, by trying to win the approval of others. Except that the satisfaction from this approval is necessarily superficial and meaningless - because it isn't really what we're looking for. The praise, the promotions, the money, and all the other markers of exterior success can't permanently mask or stifle the need to live in truth.

Fear of honest self-expression is why so much corporate, commercial or organizational writing is (let's be kind) disappointing. Conversely, great art - including great commercials - are uplifting despite their commercial nature. People respond well to honesty; they can sniff an exercise in approval-seeking and will ignore it utterly, and worse, they will think badly of the person doing the fake expression.

Writing and art are similar in how good quality is determined. Essentially there are two ingredients: basic technique and raw honesty. The first one you don't necessarily need - you can have lousy grammar or purposely use bad spelling and still be a great writer. Similarly, a self-taught artist or photographer can be a genius. What matters most is unflagging, unflinching, raw honesty.

Many people admire the seemingly carefree lives of great artists and writers. They are mistaken. Creativity is as much a burden as a choice. You don't know where it comes from, but it forces you on a lifelong hike-on-foot to try and find a perfection that can never truly exist. There is no ultimate inside to the layers of the onion. Just when you think you are doing the best you can - you could have done better. Because the only being who is truly omniscient, objective, and has no bias is God.

Phoniness is what keep marketing from being good. When brand people start talking social media - and reality shows are the epitome of trying to mix these - very often the result is horrible (except maybe in the early days before the show catches on when the characters have no choice but to be honest to get people interested in them).

A couple of examples:

* A couple of weeks ago on reality show "Kendra," husband Hank went off to a meeting with some brand folks. They were trying to decide if he and Kendra should promote their product. The conversation was full of reference to "organic" social media and "monetizing" celebrity and "perfect for the brand." Hank's head bobbled this way and that until finally he told the camera something like, "I didn't know what they were talking about." And of course then off he went to buy his wife some expensive earrings, likely in an act of product placement.

* On the now-infamous E! special, "Kim's Fairytale Wedding," stepfather Bruce Jenner has a heart-to-heart talk with Kim during which she breaks down about missing her deceased father. She also says that she feels like the whole wedding thing is out of control, and like they've lost touch with what really matters. About two seconds later on the show, Bruce enters "momager" Kris Jenner's study to talk about the situation. As he attempts to describe Kim's emotional state, Kris interrupts him with an act of product placement, saying, "look at this great deal on LivingSocial!" 

I read somewhere a comment that Steve Jobs, with Apple, gave back more value than the money he took, because the joy his products add to people's lives is well-worth the money they are paying for them. Another thing marketers can do, if they want to give something back AND win customers at the same time, is speak in voices that are honest and true. By contributing real art, they win the hearts and minds of people who can't speak freely in their own lives - making them want to buy and building up a culture where honesty is valued, while phony people are automatically excluded from the conversation.

Friday, November 11, 2011

Silence: A Sexual Predator’s Best Friend

Sexual predators and others who prey on vulnerable people are gamblers. If they feel assured of invincibility, they will victimize; if the victim will talk or they will be found out some other way and punished, they will not.


This is why it is critical for not only victims, but also those around them, to investigate and report suspected sexual abuse or harassment as soon as there is reason to believe there is a problem.


Of course, a legally mandated reporter must report whenever “financial, physical, sexual or other types of abuse has been observed or is suspected, or when there is evidence of neglect, knowledge of an incident, or an imminent risk of serious harm.”


And the community – including the family, social organizations, religious and political institutions, the media, the workplace and the courts - must step up to provide justice and support for victims. Not to mention that harassers must be removed from the populations they seek to harm.


“It Was Easy” - Silencing In The Youth Group Community


Boy Scout leader Rick Turley started molesting boys in 1979 and embarked on a nearly twenty-year “career” of pedophilia that claimed “at least” 15 children. “It was easy,” he said, noting that he was “surprised” that he actually got away with it as much as he did.


But Turley should not have been surprised, because child molesting is bad for the reputation of the Boy Scouts. “You do not want to broadcast to the entire population that these things happen,” former scouting executive A. Buford Hill told the Associated Press. “You take care of it quietly and make sure it never happens again.”


Riots at Penn State - Silencing In The Youth Athletic Community


Except that things haven’t worked out quite that way in reality.


Even after revelations that “legendary” Penn State football coach Joe Paterno did nothing to protect children from his assistant Larry Sandusky – after being told that a staffer saw Sandusky raping a 10-year-old boy in a shower – let alone allegations of a 13-year scandal of a rampant pedophile, enabled and protected by Penn State with continued access to children - the students rioted in the streets in support of Paterno!


This is what victims, or even potential victims, face when they contemplate speaking out.


“Just Tell Your Father To Stop” – Silencing in the Religious Community


As a child in school I once had a Hebrew teacher who gave me “the creeps.” While it is not true that there is a “typical” type of sex offender, they are all “manipulative, deceptive, and secretive” and this person, though he tried to seem likable, scared me.


I told my parents and sure enough, when my father “asked around” he learned that the rabbi had a reputation in the community for “liking little girls.” Unfortunately that reputation was not enough to stop him from working around children. Although he was ultimately fired for slapping another student roundly across the face, I suffered the consequences of reporting a legitimate suspicion. Not only was the “solution” that I was skipped up a grade, but the next year I left the school as well.


Today the Agudath Israel of America, the authoritative umbrella organization for ultra-Orthodox Jews, has come out forcefully in favor of reporting “where there is reason to believe” abuse is occurring, stating that no religious excuse can be made for failure to do so. Yet it is not unfamiliar for even revered rabbis to say things like, “tell your father to stop” when the abuse is too subtle to be considered legitimate in their eyes.


Abuse like this happens in every religious community, including the Church, the Muslim community, the Buddhist community, and so on. Where there are people, there are predators. But the victims are re-victimized when their suffering is swept under the rug.


“You Grieve, You Leave” – Silencing In The Workplace


The workplace is no haven from sexual abuse, except there it is called “harassment” because the predator usually tries to coerce the victim rather than literally force them into submission. One sociologist has found, that as many as 70% of women and 45% of men have been sexually harassed at work. And there, too, victims are regularly silenced.


They know that, in effect, “you grieve, you leave.”


One study of more than 6,400 military personnel found that “reporting did not improve--and at times worsened--job, psychological, and health outcomes,” as victims found that justice was not to be found within the organization. Rather, their experiences were minimized and they experienced retaliation rather than remedy.


“Think Twice Before You Accuse” – Silencing Alleged Victims of Herman Cain


Retaliation clearly occurred when Sharon Bialek and Karen Kraushaar came forward (and Ms. Kraushaar’s name was outed) to describe their experiences with Mr. Cain, they immediately found themselves on the receiving end of an onslaught of attacks.


Ms. Kraushaar had sought a joint press conference so that the collective experience of the women who have stepped forward could be aired transparently. However, as the other women are not talking, she has retreated for now from that pursuit.


So if Cain took a gamble, it seems to be paying off.


I wonder if the other accusers are scared. Cain’s lawyer has warned victims to “think twice before you accuse,” prompting even the conservative business magazine Forbes to respond with outrage.


Previously on November 8, the Herman Cain Political Action Committee website published a post, which has since been removed, with the headline “Herman Cain accuser Karen Kraushaar works for Obama and she’s ugly.” The same post reportedly called Bialek a “fat bitch.” (Although the post has been removed, the URL and headline regarding Kraushaar remains.)


Of course, harassment has nothing to do with looks and everything to do with the abuse of power.


This in addition to a full-fledged smear campaign that includes language from Clear Channel radio host Rush Limbaugh and suggestions from political commentator Dick Morris that are so offensive I will not republish them. One thing I can republish is that Limbaugh called Kraushaar’s son, who had urged her to come forward, a “Nazi ‘brownshirt.’”


And of course the obligatory digging up of “dirt” that includes accusations of “gold-digging” by both named complainants. Bialek, a single mother, has a “troubled” financial record (as do many people these days), and Kraushaar filed a complaint with a later employer that included a request for financial compensation. The complaint included mention of an email from a supervisor that I would have found offensive as well. (As far as Kraushaar, she herself called her later complaint “relatively minor,” which it does seem to be, and she ultimately did not pursue it.)


Attorney Debra Katz stated that Bialek’s accusation is more accurately described as “sexual battery.”  Whether you believe her or not (one private investigator claims Cain is more likely telling the truth, and I found her less than credible on her CNN interview, the fact that there are five complainants, at least three of them disconnected, across a span of approximately twelve years – and several more witnessed incidents – lend credence to the “where there’s smoke, there’s fire” theory.


If Cain were the gentleman he presents himself to be (“I have never acted inappropriately with anyone,”) he could simply have sued Bialek for defaming his character. Justin Bieber was accused of fathering a baby and, according to People magazine, is both taking a paternity test and “likely” suing the accuser.


As the New York University Proceedings of the 60th Annual Conference on Labor noted, “At the same time that retaliation preys on the most vulnerable persons in institutions, it simultaneously magnifies the power of high-status persons to engage in discrimination.”


“Shock, Confusion, Helplessness, Anger, Shame” - Silencing In Childhood


Undoubtedly many of the same people who have experienced workplace harassment have experienced childhood sexual abuse – from a football coach, religious teacher, youth group leader, acquaintance, parent, sibling, or someone else as well.


Although figures are not definitive (because victims don’t tell and/or neither do the adults who know about it), expert estimates range from 8-20% of all children, and retrospective studies conducted by the Centers for Disease Control estimate that about 25% of women and 17% of men.


Sexual assault victims deal with a host of psychological reactions includingshock, confusion, helplessness, anger, shame, terror, confusion, or numbness…may deny or minimize the experience…flashbacks and nightmares….avoidance (physical or psychological and including)….repression, denial, minimizing, withdrawal, or engaging in high-risk behaviors such as substance use….depression and anxiety.”


If you suspect or know about abuse taking place of any kind, first make sure that you and/or the victim are physically safe. But then, as soon as you can, report it. And if you know someone who has been victimized, offer them as much support as you can, whatever they choose to do. Together, the community of decent people can stop the human predators who seek to satisfy their darkest impulses at the expense of an army of innocent souls.


Note: Permission is granted to republish with attribution.


Sunday, November 6, 2011

10 TV commercials I really like

It was TV commercials that first got me into branding, and once in a while it's nice to sit back and appreciate them for what they are - not just a commercial form but also art.

Looking at the list below, they happen to cluster in the financial and automobile categories, not sure why. I notice that funny commercials tend to go to the top of the list, followed by commercials with some funky great character/music, and then commercials with heart.

Also, I'm noticing that great commercials usually build the brand - they are not direct "calls to action." Though one of these stands out for doing both - E-Trade. Their commercials are outstandingly convincing.

(Note - there was one commercial that almost made it onto this list, till I saw that at least some military folks found it exploitive - the Kay Jewelers "Open Heart" commercial featuring Jane Seymour. Sorry Kay.)

If anyone has a favorite commercial to add please do, as I'm always interested to see what other people think. Or one you absolutely hate, those are always fun.

Here's the "Top 10":




1. E-Trade Baby Commercial – “Time Out” (unusually strong consistency between different commercials - reinforces the call to action: “Join E-Trade, for serious investors.”)


2. E-Trade – “Passion TV”


3. Capital One Cash Card – “Graphs Commercial”




4. Kia Soul – “Share Some Soul”


5. Chrysler – “Imported From Detroit”


6. Chevy – “The Pick Up”


7. Volkswagen – “The Force”




8. Target – “Missoni for Target”


9. Jordan – “Love The Game”


10. Sonic – “You’re A Cheap Date”


Saturday, November 5, 2011

Pity The Fools Who Invested In Groupon


In December 2010, shocked that Groupon had rejected a buyout offer from Google, I suggested that they were a commodity and should take the money - either $5 or $6 billion depending on whether you read the Chicago Tribune or the NYT - and run.

Yesterday, November 4, 2011, Groupon went public in what is being called "the largest tech IPO since Google went public in 2004," (though to me it's a coupon company not a tech company). At $20 a share the resulting "value" of the company is $12.7 billion

It is common knowledge on Wall Street that this company is a lot of "hype." As former CNBC financial reporter, now Yahoo! Finance blogger Matt Nesto writes in "Groupon IPO: Shares Debut With A Bang, But Questions Remain:" 

"Once the hype of Groupon's trading debut fades, investors will closely evaluate the entire realm of opportunity and risk that lies within the 'daily deals' industry."

In the short-term Groupon is succeeding because it's got the mechanics of a successful business, absent the brand. It combines a little bit of innovation with a lot of hype and some basic customer service intelligence to establish itself as a trusted business with widespread reach:

1. Innovative technological advance - "delivering deals straight to a person's email inbox" (Nesto) - and these deals are routinely deep discounts

2. Marketing itself to vendors - they pay Groupon for the privilege of being a featured business-with-a-deal (John Abell, Wired.com, on PBS)

3. Distribution to a large user base - "30 million subscribers in 45 different countries" (Nesto)

4. Trusted business - the "Groupon Promise" offers money back, no questions asked, if you don't like something you've purchased - and they honor the promise

5. Friendly and highly localized user interface - the website is simple, well-designed, and appealing, and it is absurdly easy to sign up

Looking at all of this it seems like a no-brainer that such a company would succeed. Indeed, Groupon has rocketed to nearly $313 million in revenue (and 10,000 employees) with this model. 

The only problem is that Groupon has little, if any, brand equity. You can use any methodology to assess this that you want; I like Brand Asset Valuator because it's simple and has been used over time. According to the BAV the greater the following assets, the more valuable the brand.

* "Differentiation" - By now the business model they've invented has been copied. Can you tell the difference between Groupon and LivingSocial? (Weak)

* "Relevance" - If you spend a lot of time on leisure activities then yes, it's probably relevant to your life. (Somewhat)

* "Esteem" - Do people have "respect for and attraction to" the brand or do they just like saving money? (Weak)

* "Knowledge" - This is a huge challenge that Groupon has overcome, clearly. (Strong)

Any company that can copy the Groupon business model and improve on it in any of the weak areas above will by definition have a better brand.

This is where knowledge of branding (not to mention marketing) would be enormously helpful to investors yet unfortunately the investor community seems relatively illiterate in these areas, instead falling victim to greed and the crafty tactics of Groupon's promoters.

For example they offered up less than 5% of their stock for purchase - pumping up demand. Stanley Crouch, Chief Investment Officer at Aegis Capital, told Olivia Oran at TheStreet.com:

"The IPO was very engineered and very artificially crafted. The bankers came out with the right balance and they created demand."

In the same article, Josef Schuster, founder of IPOX Schuster, an IPO research firm, expresses surprise that people actually fell for this:

"The price dynamics in these low float deals make the stock trade up in the short term, but it's a long-term risk. We saw this during the '90s but investors seem to be repeating this." (!)

Groupon has succeeded so far because it's established itself as a technology-based trusted intermediary between merchant and customer, able to deliver a deep discount and still make money. Amazon already does this and does it better. Does anybody doubt that they are going to get into this market? And with its extensive reach into customers' lives and status as a trusted provider of information, of course Google is going to try, further notes TheStreet.com:

"Despite a strong opening on Friday, the company still faces obstacles ahead including competition from tech giants like Amazon and Google."

Not only Amazon and Google, but also LivingSocial and many others are going to try to make money from this business model:

While it's true that Wall Street insiders see Groupon as a risky investment - "too far, too fast" - they fail to grasp the importance of brand in influencing the rise or fall of a business. And so do investors.

Anyone can be innovative. Anyone can hire a techie to do code. Anyone can identify an unmet need. Anyone do marketing. And anyone can provide customer service. But very few have the genius to build a mystique that envelopes all of those other things. Howard Schultz did it, as did Estee Lauder, Mark Zuckerberg, Steve Jobs, Ralph Lauren, and Asa Griggs Candler (Coca-Cola). 

What distinguishes brand-builders from ordinary businesspeople is that they knew how to take a product/service and elevate it to a cause. It can be done, but Groupon has failed utterly. And that is why, if you've put any money into this company, it is probably a good idea to reevaluate that investment.


A separate but related commentary:

Regarding "Occupy Wall Street" - while it is certainly true that any powerful institution will do things to further its own ends, what has happened to critical thinking and personal responsibility? There is no shortage of analysis of Groupon or any other company available freely on the Internet...and yet we continue to tell ourselves what we want to believe, make stupid investments or buy things we can't afford, and then blame someone else when we can't pay for those things. 

At what point do we have to stop blaming somebody else, and start taking personal responsibility for the choices that we make, or don't make? A culture of victim-ology and finger-pointing isn't going to get any of us out of the current economic mess that we're in. And while it's easier to refuse to think and just join a movement mindlessly, in the long run it's a lot more productive to think critically and get involved in a thoughtful way.

Have a good weekend everyone...and good luck!


Image source here

Thursday, November 3, 2011

Followup to: "If information is power, why share information?"

Yesterday's post focused on the seemingly illogical action of sharing information when doing so poses so much risk.

Since obviously I do believe very strongly in information-sharing, just wanted to provide a quick followup. Let's take these one at a time:

1. Status/power/respect - while it's true that people respect authoritative leaders, it's also true that leaders who show a human side tend to gain more support from those they lead.

2. Credibility - there is nobody on this earth who hasn't made a mistake. By owning up to yours up front, rather than trying to hide or paper over them, you show maturity and gain even more credibility among your audience.

3. Security - obviously you have to have a strategic plan about what you do and don't share, but this should not mean walling off the organization entirely. This would be impossible anyway in the Internet age.

4. Social norms - it is becoming not only normative but axiomatic that the organization will share information. To be a closed organization is automatically to provoke distrust (see credibility and status, above) and even the suspicion that the organization lacks the expertise it claims to have.

5. Self-esteem - not only does it "feel good" to share information and help others, but it provides one with solid footing in a community.

From my perspective if the organization is doing what it should, then legal compliance is not an issue. It only becomes one as a last resort when there is an inability to be appropriately transparent.

One quick last word is that the principle of information-sharing can be taken too far (a la the Kardashians). There is an appropriate place and time for not sharing information. But in my view the "default setting" should be to share, unless there is a significant and justifiable reason not to.

Have a good day everyone, and good luck!

Wednesday, November 2, 2011

If information is power, why share information? (on the elusive search for transparency & collaboration)

So this is what I still don't get and I'm hoping maybe others can provide some insight. Maybe I'm just missing the obvious but...

1. If we are operating in an information economy, then information has value akin to financial currency.

Therefore it follows logically that - 

2. You wouldn't give away all your money...so what is the rational reason for sharing information, particularly information of value?

Perhaps you could argue that information-sharing is like a financial investment and:

3. You invest a limited amount of information-sharing for the sake of getting good information back - like putting your money in the stock market so that you earn enough interest to outpace inflation. 

However, there are a few powerful contravening factors in that giving away information can make you lose:

* Status/power/respect - if others are as expert as you, why do you occupy this place in the hierarchy? You may lose your mystique as people understand how you operate. And by making yourself vulnerable, others may see you as weak.

* Credibility - by showing that you've made a mistake, others may perceive that you're not worthy of the status or station that you hold

* Security - hostile individuals, organizations, or (in the case of government) enemy entities can exploit what you've shared to plan an attack on you, or use what you've said to harm you in another way.

...Not to mention that you can lurk and obtain information without ever having to share anything.

There are some arguments in response to the above but all of them seem fairly weak in comparison with social, legal, economic and physical survival:

* Social norms (everybody's sharing) - and perhaps you/your organization run the risk of not being trusted nowadays unless you are relatively open about things

* Status (people who share get respect from others and are perceived as likable)

* Self-esteem (it feels good to help other people)

The only argument one can't really argue with is 

* Legal compliance (sharing is often required)

...but even there the individual/organization may seek to change the law or comply in such a way that the information shared isn't useful or accessible.

So back to the question - if you're a self-protecting person or organization that doesn't need or want the esteem benefits of sharing and doesn't perceive it as normative, then why would you share anything beyond the bare minimum of what is legally required?

Or even further - wouldn't you try to amend the law so that the compliance requirements are fewer?

This question has so many applications, from the entire OpenGov movement to social media more broadly...comments please.