Rethinking Media

I was going to write about the Facebook/Google duopoly, but I got sidetracked by this question, “If Google and Facebook are a duopoly, what is the market they are controlling?” The market, in this case, is online marketing, of which they carve out a whopping 61% of all revenue. That’s advertising revenue. And yet, we have Mark Zuckerberg testifying this spring in front of Congress that he is not a media company…

“I consider us to be a technology company because the primary thing that we do is have engineers who write code and build product and services for other people”

That may be an interesting position to take, but his adoption of a media-based revenue model doesn’t pass the smell test. Facebook makes revenue from advertising and you can only sell advertising if you are a medium. The definition of media literally means an intervening agency that provides a means of communication. The trade-off for providing that means is that you get to monetize it by allowing advertisers to piggyback on that communication flow. There is nothing in the definition of “media” about content creation.

Google has also used this defense. The common thread seems to be that they are exempt from the legal checks and balances normally associated with media because they don’t produce content. But they do accept content, they do have an audience and they do profit from connecting these two through advertising. It is disingenuous to try to split legal hairs in order to avoid the responsibility that comes from their position as a mediator.

But this all brings up the question:  what is “media”? We use the term a lot. It’s in the masthead of this website. It’s on the title slug of this daily column. We have extended our working definition of media, which was formed in an entirely different world, as a guide to what it might be in the future. It’s not working. We should stop.

First of all, definitions depend on stability, and the worlds of media and advertising are definitely not stable. We are in the middle of a massive upheaval. Secondly, definitions are mental labels. Labels are short cuts we use so we don’t have to think about what something really is. And I’m arguing that we should be thinking long and hard about what media is now and what it might become in the future.

I can accept that technology companies want to disintermediate, democratize and eliminate transactional friction. That’s what technology companies do. They embrace elegance –  in the scientific sense – as the simplest possible solution to something. What Facebook and Google have done is simplified the concept of media back to its original definition: the plural of medium, which is something that sits in the middle. In fact – by this definition – Google and Facebook are truer media than CNN, the New York Times or Breitbart. They sit in between content creators and content consumers. They have disintermediated the distribution of content. They are trying to reap all the benefits of a stripped down and more profitable working model of media while trying to downplay the responsibility that comes with the position they now hold. In Facebook’s case, this is particularly worrisome because they are also aggregating and distributing that content in a way that leads to false assumptions and dangerous network effects.

Media as we used to know it gradually evolved a check and balance process of editorial oversight and journalistic integrity that sat between the content they created and the audience that would consume it. Facebook and Google consider those things transactional friction. They were part of an inelegant system. These “technology companies” did their best to eliminate those human dependent checks and balances while retaining the revenue models that used to subsidize them.

We are still going to need media in a technological future. Whether they be platforms or publishers, we are going to depend on and trust certain destinations for our information. We will become their audience and in exchange they will have the opportunity to monetize this audience. All this should not come cheaply. If they are to be our chosen mediators, they have to live up to their end of the bargain.

 

 

My View from Pier 21

This week, as we celebrate our countries on both sides of the 49th  Parallel (Canada Day – July 1st  – and the 4th of July in the US) – what exactly are we celebrating? What is it that we are so patriotic towards? The whole idea of a nation is a rather nebulous one. Exactly what is this thing we call America or Canada?

I got a partial answer a few weeks ago when I went to Pier 21 in Halifax. It’s the Canadian version of Ellis Island. It was where almost 1 million new Canadians first set foot when they immigrated to this continent. It is a celebration of courage, dreaming and acceptance.

Immigration – to a great extent – has woven the fabric of the nations we will celebrate this week. That is what makes the xenophobia that also seems to be part of our character in both countries so puzzling. If there were no immigrants, there would be no nation. At least, certainly not in the form we recognize this week. These immigrants, where ever they come from, have defined the nation we celebrate so vigorously. The things we revere as ours were forged from the intellect, inspiration and energy of millions that, at one time, had to step on this continent for the very first time. This includes almost everyone I know. I am the grandchild of immigrants who set sail from Liverpool. My in-laws are immigrants who set sail from Naples. The non-aboriginal roots of this continent do not run deep – a few generations for most of us – but they are strong. And this week, I celebrate that. I believe it’s a good thing. Very good.

In 2017, Kleiner Perkins Caufield and Byers partner Mary Meeker showed just how important immigration was to that most hallowed of American ideals, technical innovation. Sixty percent of the highest value tech companies in America were co-founded by first- or second- generation immigrants. Steve Jobs was the son of a Syrian. Sergey Brin was born in Russia. Facebook, Oracle, IBM, Uber, ADP, eBay – all of these American companies exist because someone decided that life would be better in a country other than the one they were born.

It is convenient to celebrate mmigration in hindsight. It is tempting to apply “Yes, but” logic to the topic. “Yes, we want immigrants, but only the right kind!” But what is the right kind? Who makes that choice? Who is wise enough – who has a crystal ball bright enough – to be able to look in the future and predict who will be a founder of the next Google or Facebook?

Here in Canada, we don’t have a great track record in that regard. Our record when it comes to welcoming new immigrants is hardly spotless. We treated the Chinese abysmally. We did the same to the Japanese during World War Two. In fact, we have – at one time or another – discriminated against immigrants from almost every nation on earth. Looking back, we admit our mistakes and apologize. We are Canadian, after all. But are we any the wiser for this knowledge? Aren’t we just making the same mistakes over and over again? The point of origin may be different, but the prejudice is all too familiar.

wheelofconsciousness

Wheel of Conscience – by Daniel Libeskind

At Pier 21 – as soon as you enter the door – you see a large mechanical wheel in the entry hall. It’s called the Wheel of Conscience, and it was created by architect Daniel Libeskind. It commemorates the tragic story of the SS. St. Louis.  The St Louis set sail for Cuba from Hamburg, Germany on May 13, 1939. There were 937 passengers, most of them were Jewish refugees fleeing from Nazi Germany. They left with valid Cuban visas, but due to a sudden change in immigration policy by a pro-Fascist government, they were denied entry in Havana. They next tried the US and set sail for Florida. Acting on the advice of Secretary of State Cordell Hull, the US government also said no. The US Coast Guard trailed the St. Louis to prevent it from running aground and allowing their passenger to illegally enter the country. Their last chance was Canada. The captain, Gustav Schroder, headed to Halifax. There, he was met with the official government decision – “None is too many” – voiced by Frederick Blair, Canada’s Director of Immigration at the time.

The MS St. Louis had no choice but to return to Europe, where the United Kingdom, France, Belgium and the Netherlands received the refugees. Of course, three of these countries would soon be overrun by the Nazis, and it’s estimated that about one quarter of the original passengers did not survive the Holocaust. The names of the refused refugees are engraved on one side of the massive wheel.

The creator, Daniel Libeskind, was the son of Holocaust survivors. He was born in Poland and immigrated to the US with his family in 1957. He became one of North America’s best-known architects and industrial designers. In 2002, he was chosen to oversee the rebuilding of the World Trade Center after 9/11.

If you want to celebrate a nation – this seems like a good place to start.

 

The View from the Other Side

After a life time in marketing I am now sitting on the other side of the table. Actually, I’m sitting on all sides of the table. In my newest venture it’s just me, so I have to do everything. And I don’t mind telling you I’m overwhelmed. These past few years have given me a whole new appreciation of how damned difficult it is to be a business owner. And my circumstances are probably better than 90% of others out there. This started as a hobby that – with surprisingly little direction from me – somehow grew into a business.  There

Is no real financial pressure on me. There are no sales numbers I have to hit. I have no investors to answer to. I have no debt to service. My business is very limited in scope.

But still – somehow – I feel like I’m drowning. I couldn’t imagine doing this if the stakes were higher

It’s Hard to Find the Time to Build a Better Mousetrap…

I’ve always been of the opinion that the core of the business and the marketing of that business should be inseparable. But as I’ve learned, that’s a difficult balancing act to pull off. Marketing is a vast black hole that can suck up all your time. And in any business, there is just a lot of stuff that requires a lot of time to do. It requires even more time if you want to do it well. Something has to give. So what should that something be? That sounds trite, but it’s not.

Take me, for example. I decided to offer bike tours. Sound simple enough, right? I had no idea how many permits, licenses and authorizations I needed to have. That all takes time. And it was time I had to spend before I could do anything else.

Like I said, to do things well takes time. Businesses naturally have to evolve. Almost none of us gets it right out of the gate. We make mistakes and then have to figure out how not to make those mistakes again. This is good and natural. I believe a good business has to have a leader that sweats the details, because the details are where shit goes wrong. I’m a big picture guy but I’ve discovered that big pictures are actually a mosaic of a million little pieces that someone has to pay attention to. And that takes time.

The Fear of a Not Doing Everything Right Now

New companies used to have the luxury of time. No one expected them to hit the home run in their first year. Well, Google and Facebook screwed that up for everyone, didn’t they? We are now all supposed to operate within some ridiculously compressed timeline for success. Our business lives are all about rushing things to market, rapid iteration, agile development. And while we’re doing all that, we should also be keeping up with our Instagram posts and building a highly engaged online community. If we don’t successfully do all those things, we feel like we’ve failed.

I’m calling bullshit on that. Most studies done on this subject show the odds of survival for a new company lasting five years are somewhere between 40 and 50%. That’s not great, but I have to believe that given the coin toss survival rate, there are a lot of companies that may not have a fully optimized Facebook business page that have somehow managed to survive bankruptcy. And even the businesses that do wrap it up are not always financial failures. Many times it’s because the founder has just had enough.

I completely understand that. I started this busIness because I wanted to have fun. And while not many of us give that reason for starting a business, I don’t believe I’m the only one. If this isn’t fun, why the hell are we doing it? But juggling a zillion balls knowing that I’m guaranteed to drop many of them isn’t all that much fun. Each morning begins with a dropped ball inventory. It seems that business today is all about reactive triage. What did I do? What didn’t I do? What might kill me and what’s only going to hurt for a while?

I’d like to end this column with some pat advice, some strategy to deal with the inevitable inundation of stuff that is demanding your time. But I’m struggling. I believe it’s hidden somewhere between my two previous points – deal with what’s potentially fatal and try to have some fun. At least, that’s what I’m trying to do.

Why Do Cities Work?

It always amazes me how cities just seem to work. Take New York – for example. How the hell does everything a city of nine million needs to continue to exist happen? Cities are perhaps the best example I can think of how complex adaptive systems can work in the real world. They may be the answer to our future as the world becomes a more complex and connected place.

It’s not due to any centralized sense of communal collaboration. If anything, cities make us more individualistic. Small towns are much more collaborative. I feel more anonymous and autonomous in a big city than I ever do in a small town. It’s something else, more akin to Adam Smith’s Invisible Hand – but different. Millions of individual agents can all do their own thing based on their own requirements, but it works out okay for all involved.

Actually, according to Harvard economist Ed Glaeser, cities are more than just okay. He calls them mankind’s greatest invention. “So much of what humankind has achieved over the past three millennia has come out of the remarkable collaborative creations that come out of cities. We are a social species. We come out of the womb with the ability to sop up information from people around us. It’s almost our defining characteristic as creatures. And cities play to that strength. Cities enable us to learn from other people.”

Somehow, cities manage to harness the collective potential of their population without dipping into chaos. This is all the more amazing when you consider that cities aren’t natural for humans – at least – not in evolutionary terms. If you considered just that, we should all live in clusters of 150 people – otherwise known as Dunbar’s number. That’s the brain’s cognitive limit for keeping track of our own immediate social networks. It we’re looking for a magic number in terms of maximizing human cooperation and collaboration that would be it. But somehow cities allow us to far surpass that number and still deliver exponential returns.

Most of our natural defense mechanisms are based on familiarity. Trust, in it’s most basic sense, is Pavlovian. We trust strangers who happen to resemble people we know and trust. We are wary of strangers that remind us of people who have taken advantage of us. We are primed to trust or distrust in a few milliseconds, far under the time threshold of rational thought. Humans evolved to live in communities where we keep seeing the same faces over and over – yet cities are the antithesis of this.

Cities work because it’s in everyone’s best interest to make cities work. In a city, people may not trust each other, but they do trust the system. And it’s that system – or rather – thousands of complementary systems, that makes cities work. We contribute to these systems because we have a stake in them. The majority of us avoid the Tragedy of the Commons because we understand that if we screw the system, the system becomes unsustainable and we all lose. There is an “invisible network of trust” that makes cities work.

The psychology of this trust is interesting. As I mentioned before, in evolutionary terms, the mechanisms that trigger trust are fairly rudimentary: Familiarity = Trust. But system trust is a different beast. It relies on social norms and morals – on our inherent need to conform to the will of the herd. In this case, there is at least one degree of separation between trust and the instincts that govern our behaviors. Think of it as a type of “meta-trust.” We are morally obligated to contribute to the system as long as we believe the system will increase our own personal well-being.

This moral obligation requires feedback. There needs to be some type of loop that shows our that our moral behaviors are paying off for us. As long as that loop is working, it creates a virtuous cycle. Moral behaviors need to lead to easily recognized rewards, both individually and collectively. As long as we have this loop, we will continue to be governed by social norms that maintain the systems of a city.

When we look to cities to provide us clues on how to maintain stability in a more connected world, we need to understand this concept of feedback. Cities provide feedback through physical proximity. When cities start to break down, the results become obvious to all who live there. But when it’s digital bonds rather than physical ones that link our networks, feedback becomes trickier. We need to ponder other ways of connecting cause, effect and consequences. As we move from physical communities to ideological ones, we have to overcome the numbing effects of distance.

 

Tempest in a Tweet-Pot

On February 16, a Facebook VP of Ads named Rob Goldman had a bad day. That was the day the office of Special Counsel, Robert Mueller, released an indictment of 13 Russian operatives who interfered in the U.S. election. Goldman felt he had to comment via a series of tweets that appeared to question the seriousness with which the Mueller investigation had considered the ads placed by Russians on Facebook. Nothing much happened for the rest of the day. But on February 17, after the US Tweeter-in-Chief – Donald Trump – picked up the thread, Facebook realized the tweets had turned into a “shit sandwich” and to limit the damage, Goldman had to officially apologize.

It’s just one more example of a personal tweet blowing into a major news event. This is happening with increasingly irritating frequency. So today, I thought I’d explore why.

Personal Brand vs Corporate Brand

First, why did Rob Goldman feel he had to go public with his views anyway? He did because he could. We all have varying degrees of loyalty to our employer and I’m sure the same is true for Mr. Goldman. Otherwise he wouldn’t have swallowed crow a few days later with his public mea culpa. But our true loyalties go not to the brand we work for, but the brand we are. Goldman – like me, like you, like all of us – is building his personal brand. Anyone who’s says they’re not – yet posts anything online – is in denial. Goldman’s brand, according to his twitter account, is “Student, seeker, raconteur, burner. ENFP.” That is followed with the disclaimer “Views are mine.” And you know what? This whole debacle has been great for Goldman’s brand, at least in terms of audience size. Before February 16th, he had about 1500 followers. When I checked, that had swelled to almost 12,000. Brand Goldman is on a roll!

The idea of a personal brand is new – just a few decades old. It really became amplified through the use of social media. Suddenly, you could have an audience -and not just any audience, but an audience numbering in the millions.

Before that, the only people who could have been said to have personal brands were artists, authors and musicians. They made their living by sharing who they were with us.

For the rest of us, our brands were trapped in our own contexts. Only the people who knew us were exposed to our brands. But the amplification of social media suddenly exposes our brand to a much broader audience. And when things go viral, like they did on February 17, millions suddenly became aware of Rob Goldman and his tweet without knowing anything more than that he was a VP of Ads for Facebook.

It was that connection that created the second issue for Goldman. When we speak for our own personal brands, we can say, “views are mine” but the problem always comes when things blow up, as they did for Rob Goldman. None of his tweets were passed by anyone at Facebook, yet he had suddenly become a spokesperson for the corporation. And for those eager to accept his tweets as fact, they suddenly became the “truth.”

Twitter: “Truth” Without Context

Increasingly, we’re not really that interested in the truth. What we are interested in is our beliefs and our own personal truth. This is the era of “Post Truth” – the Oxford Dictionary word of the year for 2016 – defined as “relating to or denoting circumstances in which objective facts are less influential in shaping public opinion than appeals to emotion and personal belief’.

Truth was a commonly understood base that could be supported by facts. Now, truth is in the eye of the beholder. Common understandings are increasingly difficult to come to as the world continues to fragment and become more complex. How can we possibly come to a common understanding of what is “true” when any issue worth discussing is complex? This is certainly true of the Mueller investigation. To try to distill the scope of it to 900 words – about the length of this column – would be virtually impossible. To reduce it to 280 characters – the limits of a tweet and one- twentieth the length of this column – well, there we should not tread. But, of course, we do.

This problem is exacerbated by the medium itself. Twitter is a channel that encourages “quipiness.” When we’re tweeting, we all want to be Oscar Wilde. Again, writing this column usually takes me 3 to 4 hours, including time to do some research, create a rough outline and then do the actual writing. That’s not an especially long time, but the process does allow some time for mental reflection and self-editing. The average tweet takes less than a minute to write – probably less to think about – and then it’s out there, a matter of record, irretrievable. You should find it more than a little terrifying that this is a chosen medium for the President of the United States and one that is increasingly forming our world-view.

Twitter is also not a medium that provides much support for irony, sarcasm or satire. In the Post-Truth era, we usually accept tweets as facts, especially when they come from someone who is a somewhat official position, as in the case of Rob Goldman. But at best, they’re abbreviated opinions.

In the light of all this, one has to appreciate Mr. Goldman’s Twitter handle: @robjective.

Sharing a Little about the Sharing Economy

In the last week, I’ve had first hand experience with the sharing economy, using both Uber and Air BnB. I – not surprisingly – am a sucker for disruption and will gladly adopt new technologies. I appreciate the rational logic of a well thought out platform that promises to be a game changer. I push my wife’s comfort level to the breaking point, trying mightily to maintain the balance between delightful discovery and that cold stare that means I’ve completely messed up this time. It is in that spirit – and with the admitted bias of being a sample of one – that I share some of my macro-level observations.

Creating an Opening for Innovation

To me, using the term the “sharing economy” doesn’t quite cut it. That only explains one aspect of this disruption – the supply side. What is really happening here is the democratization and fragmentation of a previously verticalized market, where the platform creates a new type of one-to-one market connection. That spreads the market horizontally, which in turn opens a wide door for participation at all levels. And that, inevitably, spurs innovation. When you allow everyone to be creative – rather than just a few within a vertically integrated chain who have it in their job description – the pace of innovation can’t help but accelerate.

Disruptive Platforms and Network Effects

Innovation is a good thing, but there is another side to this. If you allow for rampant innovation and facilitate one-to-one connections at all levels of the market, you are going to have network effects. Markets become more chaotic and less predictable. The rising tide of innovation will eventually raise all boats, but it also means the waters can get a little choppy on the way. Disruptive platforms strip away traditional control systems – corporate oversight, traditional forms of consumer protection and legislative regulation. All faith – on both sides of the market – is placed on the design of the platform to ensure self-correcting regulation. There’s just one problem with that…

Compression of Pendulum Markets

When you depend on self-correction in a dynamic market, you forego stability that typically comes from vertical oversight. Not only do you remove the oversight but you also remove predictability. There are new players entering and exiting the market all the time. And even if the players stabilize, experience has limited value in a marketplace that may not do tomorrow what it did yesterday.

All sharing platforms – Uber and AirBnB included – depend on market feedback to ensure self correction. In these two cases, they have well thought out market control mechanisms but feedback is – by necessity – a reactive rather than a proactive device. You can anticipate with reasonable confidence in a stable, controlled market but you can’t in a dynamic, networked market. All you can do is respond. This creates a pendulum effect. Constant connection to the platform means that feedback is fast, but the physics of a pendulum mean that the volatility of the swings back and forth are greatest at the beginning and stabilize over time.

This creates what I would call the Bubbles and Backlash phenomenon. As markets open up, new suppliers jump on the bandwagon. Some are great, some are horrible, some are mediocre. But it will take the platform and it’s self-correcting mechanisms some time to sort them out. Also, we have to hope the mechanisms are reasonably robust against suppliers who want to game the system. I think both Uber and AirBnB are working their way through this particular pain point right now. I find ratings artificially high on many suppliers which whom I’ve had personal experience. There could be a number of reasons for this, including the psychological bias of reciprocity, but I think most platforms have some tweaking to do before the user ratings provide a reasonable frame of expectations.

Inevitable Gaps in the User Experience

Finally, because the travel market is moving from a vertical orientation to a horizontal one, it leaves it up to the user to navigate her way through the various horizontal layers that stack together to create her individual user journey. When you’re in a layer – taking Uber to the airport for example – you’re probably okay. But it’s moving from layer to layer that places a little extra demand on the user. The previous players who inhabited the niches within the vertical ecosystem are understandably reluctant to share their niches with new, disruptive players. Where, for example, do you catch the Uber at the airport?

But All’s Well that Ends Well

In the end, it comes down to a matter of taste. I am an early adopter, so I will always choose disruption over the status quo. For those of a different bent, the vertically integrated path is still open to them. But for all of us, I believe disruption has created a travel marketplace that is more diverse, authentic and rewarding than ever before.

 

Thinking Beyond the Brand

Apparently boring is the new gold standard of branding, at least when it comes to ranking countries on the international stage. According to a new report from US News, the Wharton School and Y&R’s BAV Group, Canada is the No. 2 country in the world. That’s right – Canada – the country that Robin Williams called “a really nice apartment over a meth lab.”

The methodology here is interesting. It was basically a brand benchmarking study. That’s what BAV does. They’re the “world’s largest and leading empirical study of brands” And Canada’s brand is: safe, slightly left leaning, polite, predictable and – yes – boring. Oh – and we have lakes and mountains.

Who, you may ask, beat us? Switzerland – a country that is safe, slightly left leading, polite, predictable and – yes – boring. Oh – and they have lakes and mountains too.

This study has managed to reduce entire countries to a type of cognitive short hand we call a brand. As a Canadian, I can tell you this country contains multitudes – some good, some bad – and remarkably little of it is boring. We’re like an iceberg (literally, in some months) – there’s a lot that lies under the surface. But as far as the world cares, you already know everything you need to know about Canada and no further learning is required.

That’s the problem with branding. We rely more and more on whatever brand perceptions we already have in place without thinking too much about whether they’re based on valid knowledge. We certainly don’t go out of our way to challenge those perceptions. What was originally intended to sell dish soap is being used as a cognitive short cut for everything we do. We rely on branding – instant know-ability – or what I called labelability in a previous column. We spend more and more of our time knowing and less and less of it learning.

Branding is a mental rot that is reducing everything to a broadly sketched caricature.

Take politics for example. That same BAV group turned their branding spotlight on candidates for the next presidential election. Y&R CEO David Sable explored just how important branding will be in 2020. Spoiler alert: it will be huge.

When BAV looked at the brands of various candidates, Trump continues to dominate. This was true in 2016, and depending on the variables of fate currently in play, it could be true in 2020 as well. “We showed how fresh and powerful President Trump was as a brand, and just how tired and weak Hillary was… despite having more esteem and stature.”

Sable prefaced his exploration with this warning: “What follows is not a political screed, endorsement or advocacy of any sort. It is more a questioning of ourselves, with some data thrown to add to the interrogative.” In other words, he’s saying that this is not really based on any type of rational foundation; it’s simply evaluating what people believe. And I find that particular mental decoupling to be troubling.

This idea of cognitive shorthand is increasingly prevalent in an attention deficit world. Everything is being reduced to a brand. The problem with this is that once that brand has been “branded” it’s very difficult to shake. Our world is being boiled down to branding and target marketing. Our brains have effectively become pigeon holed. That’s why Trump was right when he said, “I could stand in the middle of Fifth Avenue and shoot somebody and I wouldn’t lose any voters”

We have a dangerous spiral developing. In a world with an escalating amount of information, we increasingly rely on brands/beliefs for our rationalization of the world. When we do expose ourselves to information, we rely on information that reinforces those brands and beliefs. Barack Obama identified this in a recent interview with David Letterman: “One of the biggest challenges we have to our democracy is the degree to which we don’t share a common baseline of facts. We are operating in completely different information universes. If you watch Fox News, you are living on a different planet than you are if you listen to NPR.”

Our information sources have to be “on-brand”. And those sources are filtered by algorithms shaped by our current beliefs. As our bubble solidifies, there is nary a crack left for a fresh perspective to sneak in.