Category Archives: Corporate Darwinism

A Great Question: Why Don’t Big Companies “Get It?”

At our event in the Bay area last week, Marketo Marketing Director Jon Miller gave a very compelling presentation about how they’ve put a comprehensive sales and marketing strategy together that not only blows away performance benchmarks in his category, but outstrips what would be considered “Best of Breed” campaigns. At the same event, someone from a huge company asked who were the companies that were “doing it right” in B2B. A panel of very smart B2B marketers looked at each other, struggling to come up with a single name. Finally, Jon said “Well, I think we’re doing it pretty well.” It might have sounded boastful, but Jon had the numbers to back up his claim.

I’ve thought about that a lot in the few days since. Why can a small company like Marketo put together a digital campaign that integrates all the right pieces and gets them to click while a Fortune 500, with all their resources available, can’t?  Why are smaller companies much more likely to “Get It”, with a big G?

“Getting it with a Big G”

First, I should explain what I mean by Big G “Getting It.” When I look at the most successful marketers in the digital ecosystem, they have a unique ability to position themselves at exactly the right place on the digital adoption curve. They can read where their markets are going and seem to be there at the right time with the right offering. They offer something so compelling that adoption is a no brainer. These companies have a magical ability to combine the promise and advantages of game changing technology with a intuitive sense of what the market wants. Think Amazon, eBags, NetFlix & Zappos.

Hmmm..you say. No B2B companies in that mix? I would put Salesforce there, but after that, it gets difficult to think of B2B marketers who have found the sweet spot of the adoption curve. That’s why our panel was stumped when asked for examples of B2B companies that “Get It.”

I think the answer lies in the inherent nature of the companies that “Get It”. I suspect there are things that are natural here that it’s almost impossible for bigger companies to emulate. This follows up an earlier post about companies that seem to naturally benefit from SEO. As I thought more about it, I realized it comes down to a few common things:

Top Down, Bottom Up Buy In – Getting a company aligned and on the same page is just a whole lot easier when an executive meeting consists of leaning back in your chair and yelling across the hallway. There’s immediacy of communication and, through this, agreement, that’s intoxicating in a smaller company. If you get executive commitment to an initiative, the entire company can know about it and start executing in minutes if required.

Nimbleness –  With quicker communication comes nimbleness. Smaller companies move faster than big companies, and in the digital marketplace, that’s a vital advantage. If you get that rarest of animals, a small company with seasoned executives who have “been there, done that”, you get a tremendously effective execution machine: a company who knows what to do and can actually do it without dealing with energy sucking inertia.

Growing Up Digital – The handful of companies that I see have almost all grew up in a natively digital market. The online marketplace is baked right into their DNA. Another important point: they get technology, but they’re not star struck by it. If they’re chasing a social media strategy, it’s because they understand that it’s because conversations are happening and they need to be part of them, not because they’ve been caught up in the buzz and hyperbole of it.

It’s Not Marketing, It’s How We Roll – The idea of marketing as a separate department or discipline seems to belong to a past generation. In the successful new breed of companies that “Get It”, marketing best practices are so deeply woven into the fabric of the company that it’s impossible to separate them from all the other stuff the company does. They just do the things that are right for the customer, and everything good seems to naturally flow from that. If you want to call it marketing, fine, but it’s not the first label they’d put on it. They tend to use words like “culture” and “core values.”

Living Closer to the Customer – This ingrained ability to anticipate customer needs comes from living closer to the customer.  There is very little distance between everyone in the company and all their customers in smaller businesses. The CEO knows and understands at a gut level what the customer wants from them. And, if you have an executive that knows how to execute (rarer than you might think) you’ve got consistently happier customers.

Those are my observations after a few days thought, but this question of why smaller, newer companies seem better positioned to evolve in the new marketplace is one that needs more thought. If you could take a few minutes to share any examples of companies that you think embody these characteristics, I’d be grateful. Just add a comment to the blog and I’ll start compiling a list of examples to both share and to take a closer look at.

The Pressure’s On and the Cracks are Beginning to Show

First published September 10, 2009 in Mediapost’s Search Insider

Some time ago, I wrote a column saying the fallout of the economic crisis would be a rapid evolution in marketing practices, speeding the transition from the old way of doing things to a much more dominant role for digital. In that transition, search would play a bigger role than ever. In the past few months, I’m seeing exactly that come to pass. People are serious about search, from the bottom right up to the top corner office. This isn’t playtime in the sandbox anymore; we’re suddenly moving front and center.

“I’m Ready for My Close Up, Mr. CMO”

The reason people are so interested in search is that it comes with the reputation of being highly measurable and accountable. This isn’t anything new, but lately, it’s coming with some additional baggage. Now that the C-Level is involved, performance isn’t being judged simply on a trial campaign with a limited budget. Suddenly, search is being tested to see if it’s worthy of taking a starring role in the marketing mix. And that is adding a lot of pressure to those of us toiling down here in the search trenches.

Search, by its nature, isn’t all that scalable. It comes with a built-in inventory limitation. You can only reach people who have raised their hand, indicating interest in something. Once you tap out that inventory, search loses its bright shiny luster. Search is effective because it’s a signal for consumer intent. You can’t use search to create intent where none exists.

“You Bid on What?”

Management of search isn’t very scalable, either. It’s a lot of heavy lifting and obsessing over thousands of tiny little nitty-gritty details, which, if you overlook them, can suddenly blow your ROI right out of the water. Just ask the PPC manager who forgot to set the appropriate budget cap and comes in on a Monday morning to find they’ve just spent several thousand dollars of a client’s money on a broad match for the word “lube.”

Also, the new breed of client is expecting more than just a limited tactical approach to search. Suddenly they’re using words like “integrate” and “holistic” because, well, because those are just the kind of words you use when you get to the top of the corporate food chain. You get paid the big bucks because you can toss “synergistic” around in a board meeting and actually be serious at the time.

Back to the Drawing Board

Right now, people across this great land are pulling out their white boards and sketching out the rudiments of “Marketing Plan 2.0.” They know something important has shifted in the marketing landscape; the economic belly flop has made it all too apparent that there must be a better way of doing things.  I haven’t seen any huge waves of budget pouring into search yet, but I know there’s a lot of talk out there, and much of it is about search.

Generally, I think this is great news. I’m the first to complain about the tactical bias of search marketing.  I think search has a much greater role to play — but I feel it’s only fair to warn search marketers that this isn’t going to be a painless skip down the path to a lucrative retirement. Anytime there’s a big shift, it comes with an accompanying pendulum effect. After being restrained too far on one side of equilibrium, the pendulum has to correct by swinging too far in the other direction. As budgets start to come into digital channels, including search, we’ll learn that, in many cases, it comes with a set of expectations that are seriously out of whack.

Survival of the Fittest

There are some search marketers that are ready, willing and able to take search to the next level, the one it rightly deserves. There are many others who will use impressive words in the sales pitch (words like holistic, integrated and synergistic) but fall seriously short on delivery. The path ahead is going to have a lot of casualties, both on the vendor and client side. But then, evolution has never been a particularly gentle process.

Just ask any ichthyosaurus.

SEO Success: Sign of a Healthy Corporate Culture

First published July 9, 2009 in Mediapost’s Search Insider

I’ve been working with companies on SEO for over a decade now, and there’s one thing I’ve noticed: all things being equal, healthy companies with great cultures seem to do much better in organic search results. And by organic success, I mean the good, white-hat, Matt Cutts-approved kind of success. I bet that if you found the companies that do well in organic search, you’d also find companies that Jim Collins (author of “Built to Last” and “Good to Great”) would be proud of. This correlation can’t be coincidence, so I’ve outlined some reasons why this might be so:

Flatter and more-responsive organizations. Working on SEO is like taking your Web site to the doctor: a good SEO consultant will tell you what you have to do, but the hard work is up to you. Companies that listen and respond will do better than companies that justify, finger-point and go on the defensive. Healthy companies look for ways to improve; dysfunctional companies offer reasons why improvement is impossible. Companies that refuse to do the heavy lifting required to whip their site into shape generally are equally negligent in other areas of their business.

Better communication channels. SEO is by nature a cross-functional exercise. It involves many different departments, all working together toward a common goal. This approach is well within the comfort zone of healthy organizations, but totally foreign to dysfunctional ones. An SEO initiative severely tests the communication and cooperative capabilities of an organization. It requires marketing, IT, product managers and often legal to all work together, and the faster they can do this, the more positive the results will be. SEO is not a one-shot tactic. In the most competitive categories, it’s a full-out and ongoing war. The companies that can respond and adapt quickly will win that war. The ones mired in bureaucracy and butt-covering will inevitably sink in the rankings.

Healthy community connections. The new era of digital communications requires companies to be engaged in an ongoing dialogue with their community of customers. Great companies do this instinctively. Bad companies put up huge corporate communication barricades, keeping the angry hordes at bay. Because much of this dialogue happens online, these dialogues tend to generate reams of content and links. Raving customers generate link love; angry customers generate link hate and reputation management problems. A company that can effectively engage in conversations with customers will find a natural lift in organic rankings is often the result.

Efficient execution habits. Companies that keep a clean house do better organically than companies that keep skeletons in the closet. Both approaches are symptomatic of the company’s overall approach to business. Highly effective companies constantly upgrade systems and infrastructure, both in their organizations and their online presence. They invest in best of breed tools and technology. And they are able to quickly prioritize and executive as the landscape shifts. Again, a clean technical online infrastructure makes SEO much, much easier.

Executives that “get it.” C-level executives who make SEO a priority realize that the marketing landscape is shifting quickly. They’ve been paying attention to customer behavioral trends and have committed to being proactive rather than reactive. This usually indicates well-placed intelligence gathering “antennae” and feedback loops. It also indicates an executive who isn’t hopelessly mired in “old-boy” thinking and outdated command and control management models.

Corporate pride. Content might not be the sole king anymore (SEO is more of an oligarchy now) but it’s still part of the ruling class. Great cultures tend to engender pride that naturally precipitates an explosion of content. People blog about where they work, people tweet and product managers enthuse verbosely about what they’re working on. All of this generates great, searchable content online.

Companies get the SEO rankings they deserve. I’m guessing that if you asked any SEO consultant in the world, they’ll tell you their favorite clients are the ones that are the easiest to work with: clients who listen, are proactive and for whom continual improvement is a religion. Based on what I’ve seen in the past decade, this attitude extends beyond the SEO team (indeed, it has to) and permeates the entire culture. There are those who game the system and gain undeserved rankings, but more and more, “organic” rankings are just that: rankings that come from the very nature of the company and how they conduct themselves in the marketplace.

Get It or Die: Online is Your Core Business

First published June 11, 2009 in Mediapost’s Search Insider

In a recent survey, we asked B2B buyers how they prefer ordering the things they order all the time. Sixty-three percent said they prefer to order them online. The next largest group was the 15% who would go the traditional route of ordering from a local office over the phone. Another 12% said they’d prefer to order from a real live sales rep. In a recent presentation to a client, I kept that pie chart of results up for a while, allowing it to sink in, because I think the implications are astounding.  After it sunk in, I asked what I believe to be a fundamentally important question: “Look at the chart and ask yourself, how closely does your company’s strategic direction and resource allocation match that pie chart? That’s where your customers are going, and they’re moving fast. Are you going to be there when they get there?”

“getting it” vs. “Getting It”

Lately, I’ve also talked a lot about “getting it.” To me, there are two levels of getting it.  There’s the safe level: the proficient e-business unit that understands search and executes effectively, realizes that online strategies have to be planned across channels, is struggling to put attribution models in place that work, and is continually testing and optimizing landing pages. If we look at digital marketing alone, they understand it and are skilled practitioners. This level, “getting it” with a small “g,” is rare, although there are several examples to look at.

But then there’s “Getting It,” with a capital “G.” This is the company that realizes that online forms the core of the customer experience and that everything else has to support that — if not today, then in the very near future. This is the company that is rapidly and aggressively moving to digital as its primary way of doing business, that is already making the painful but required transitions and is willing to cannibalize its traditional core in order to support the move to online. Outside of pure online plays, this level of “Getting It” is so rare as to be basically nonexistent.

Digital Butt-Covering

Companies pay lip service to “getting it,” but they’ve hedged all their online bets. They have treated online as an incremental revenue channel, putting in rigorous ROI thresholds so that it can be separated from the core business and risk can be balanced against returns and investment, thus minimizing it. E-business is a siloed sandbox, relegated to the sidelines so it doesn’t rock the mother ship.

What these companies fail to realize is that this safe, incremental approach to moving online is probably the riskiest thing they can do. Here’s why.

Online is a discontinuous innovation in consumerism of all kinds. It’s a huge step forward for the buyer in almost every way imaginable. It’s easier, more convenient, more useful and more effective. If people aren’t buying online, they’re researching online. And no matter how much they’re doing both those things, they would like to do more. The only thing holding them back is a lack of destinations or a quality user experience on the destinations they do have to choose from.  Your customers are adopting online at an incredibly fast rate.

By easing towards online at a safe, incremental rate because you’re mitigating risk to your core business, you’re allowing your critical mass of customers to get in front of you. Whenever a mass of customers is underserviced, someone will fill that gap, and you can bet it will be a nimble, online pure play that’s moving at light speed compared to you.

Internet Speed Defined

Jim Lecinski from Google’s Chicago office has a chart he loves to show in client presentations. It slaps you upside the head with the reality of “Internet speed.” He first recounts a typical conversation with a client that falls squarely in the first category of “getting it.”

Jim: “What are you doing with your online campaigns?”

Client: “Oh, we have a lot happening. We’re expanding our keyword list next quarter and we’ll optimize that campaign over the following quarter. In Q3 and 4 we’re going to run some experiments with social media that we’re excited about. For the next fiscal, we’ve built more into the budget for better tracking and attribution. That will help as we move to cross-channel optimization because we’ll get great data showing us what’s working and what’s not. That will also allow us to step up our landing page testing and optimization.”

Jim: “So, you’ve got your plans set out for about 18 to 24 months ahead?”

Client: “You bet. We’re moving very quickly.”

Then Jim shows them the Google Trends graph that reminds them that both YouTube and FaceBook went from zero to Internet domination in under 24 months. Further, few people had heard of Twitter 12 short months ago.

That’s Internet Speed.

That’s “Getting It.”

More on the Confluence of Spring Break

First published April 2, 2009 in Mediapost’s Search Insider

Starting in the 1400s, an explosion of exploration came from Europe called the Age of Discovery. Prior to that, the world was a much smaller place. In fact, the end of the world was reckoned to be somewhere past Cape Bojador in West Africa. But during this time of exploration, the boundaries of the world were pushed back dramatically. By the end of the 15th century, Bartolomeu Dias rounded the Cape of Good Hope, Vasco da Gama sailed by this route to India and Christopher Columbus had sailed to the new world. Just 20 years later, Ferdinand Magellan would become the first to circumnavigate the globe. In just over 100 years, the world as we know it was discovered. And it was all due to one person: Prince Henry the Navigator.

Meet Prince Henry

Prince Henry was born in 1394, the third son of King John I of Portugal. At the age of 27, his father made him governor of the province of Algarve, in the south of Portugal (coincidentally, where I spent my spring break family vacation). Although he became known as Prince Henry the Navigator or Seafarer, neither is very close to the truth. Prince Henry spent little time on a boat. Henry was really more a very capable administrator. He built the foundations that would propel Portuguese explorers to explore the world, expand the empire and bring untold wealth back to Portuguese shores. Henry set in motion a chain of events that changed history.

Henry accomplished this through four tasks:

  • He convinced Portuguese patrons, primarily the very wealthy Order of Christ, to provide a consistent source of funding for discovery, allowing for ongoing exploration.
  • He ordered the development of the much lighter and faster caravel, which allowed for more precise coastal navigation and faster crossings. It became the preferred vessel for Portuguese exploration.
  • He created a center for navigational education and cartography at Sagres, where the Portuguese developed the techniques to allow them to sail much further away from land, something that almost certainly would have resulted in disaster before this.
  • He created a “revenue model” for exploration, convincing his family of the benefits of opening up the spice and incredibly lucrative slave trade (moral judgments aside), all flowing into the nearby port of Lagos (where we stayed during our vacation).

In short, Henry created the conditions for success that lead to the explosion of discovery. The desire to break the Portuguese stranglehold was why Spain financed Columbus’s journey (rumor has it that Columbus spent time at Sagres). And the later period of English discovery was also precipitated through competition with Portugal and Spain. And it all began with an effective administrator.

Taking a Lesson from History

Now, let me draw together my three disparate ideas that I started last week, (although I’m sure you’re already well ahead of me):

  • In “Outliers,” Malcolm Gladwell argues that success isn’t pure chance. It’s a combination of conditions that can be planned and set in place. Certainly, Vasco da Gama didn’t luck into his discovery of the route to India
  • Ray Kurzweil (whether or not you agree with his vision of the future) shows that technology can release us from the constraints that threaten our world, including disease, poverty, environmental damage and even death.
  • And Henry the Navigator provides historical proof of the value of a visionary and capable administration.

We who are fortunate enough to find ourselves in rich, developed countries have enjoyed a disproportionate share of success. Even during the current financial turmoil, we are still, by far, the wealthiest and most advantaged people on the face of the earth. But we cannot move forward with a misbegotten sense of entitlement or by taking our success for granted. We have to put the foundations in place that will lead to success in a new and dramatically different world. We have to follow in Henry’s footsteps, building the foundations that will lead to discovery and expansion of our world. If we don’t, someone else surely will. In fact, they already are. To the East, exactly those foundations are currently being put in place.

We need an administration that is capable of building this foundation. And here, we can learn a lesson from history. This administration must:

  • Realize that discovery is an incremental and imperfect process. For every success, there will be many more failures. But success is impossible without those failures.
  • Be bold and consistent in guaranteeing funding for technological discovery.
  • Be wise in balancing the moral dilemmas presented by technology. The good of the many must prevail against the knee-jerk reactions of the few.
  • Be prepared to completely reinvent our concept of education, because we are being quickly left behind.We have been blessed with huge advantages and the future is ours to lose, but there is nothing guaranteed here. In the 1300s, Portugal was a small and relatively insignificant player on the European landscape. But, because of one man’s vision, they ruled the world just one hundred years later. It was an era of discovery and opportunity that was unequaled in history. But it pales in comparison to what awaits us.

Looking for the Future? Look for Chaos, not Stability

First published March 19, 2009 in Mediapost’s Search Insider

This week, someone asked me about sustainable business models in the Internet.  Earlier the same day, another person asked me about defensible models. Both questions left me perplexed. I wasn’t trying to avoid them. I just didn’t know how to answer. So, some 48 hours later, I offer this column as a somewhat belated response. It isn’t an answer, as I’m still just as perplexed. But now at least I know why.

So why are people asking about defensible and sustainable business models on the Internet? Well, if there’s one thing the Internet has done, it’s brought sky-high valuations back to earth. So, investors doing what investors do, they’re suddenly looking for “bargain” companies that have mature business models and trial-tested management.  Hence the quest for sustainability and defensibility. Reasonable, right? It certainly makes sense if you’re going shopping for a private equity fund. But in the last two days, I’ve decided it’s almost exactly the wrong question to ask. It’s like looking for dry ground in a tsunami: it may give you some temporary peace of mind, but don’t count on it to last long.

The Quarter Century Electric Switch

Nicholas Carr’s book, “The Big Switch,”  ties the development of the Internet to a previous discontinuous innovation, the electrification of America. In it, he provides a fascinating recount of the unsung visionary who laid the foundations of the power grid we take for granted today, Samuel Insull.  Insull started as Thomas Edison’s clerk, but soon split with his mentor in his vision of the future of electricity. Edison, for all his brilliance, was thinking too small. He was concentrated on building individual DC generators for industrial applications. Insull saw the promise of a ubiquitous power supply, centrally generated and then distributed. It is Insull, not Edison, who is responsible for the power receptacle that probably sits no more than 10 feet away from you right now.

In the very earliest days of electricity, one would have been a fool not to choose Edison as the forerunner, the candidate most likely to carve a business out of the new frontier. His innovations harnessed electricity and made it usable.

But if you had bet on Edison to provide a sustainable model, you would have lost. It was Tesla’s AC standard, not Edison’s DC, that proved to be the one adopted. And it was Insull’s vision of electricity as a utility that changed our world.

The idea was simply too big for one man. And it was bringing all the implications of that idea together that proved to be the true agent of change. It launched a shift in American (and global) lifestyles that Edison never envisioned.  But from the initial stages in the final years of the 19th century, that shift took three decades to be fully realized. It took the building of new infrastructure, the development of new industries and the adoption of certain ways of doing things. It took thousands of visionaries, not one, to realize the significance of harnessing electricity.  Imagine then the impossible task of finding a defensible, sustainable business model for electricity in 1895. In hindsight, it’s clearly laughable to even attempt such a thing. But today, we’re trying to do exactly that with the Internet.

Fragmented Functionality

There is one big difference between the Internet and electricity. An electrical appliance is an electrical appliance. Its functionality is usually independent. A blender doesn’t become more useful if you also plug in a toaster. But the Internet lives on mashups and APIs. Apps can become exponentially more powerful if they plug into other apps.

Today, the Internet is a fragmented place. Functionality lies across the grid in a million different shards and chunks. Some of these are larger than others. Search is a particularly large one. And today, we’re just beginning to explore how all this functionality can come together.  The infrastructure has been laid. The grid has been built. Now it’s time to start plugging in apps and see how they can work together. If you think the last decade brought discontinuous change, wait til you see what the next decade has in store. We’re just getting ready to take the Net for a spin and see what it can do.

I’ve come to realize that there’s no such thing as revolutionary change. It only appears so when you look at it in a historical perspective. Instead, there  are tipping points of incremental change. Every supposedly revolutionary development was built on the back of hundreds of other developments. Cumulatively, they indeed change everything, but each development could never have happened without its supporting cast. It wasn’t Edison’s development of the incandescent light bulb that lit up America. It was a thousand developments, by Faraday, Golvani, Ohm, Volta and many others. Each one pushed us closer to the tipping point. When we reach it, we step forward, never to look back.

Back to the Original Question

To return to the beginning: What is a sustainable, defensible business strategy online? I have no idea. I don’t think such a thing exists. For all the excitement, for all the promise, there are no sure bets. The two concepts are incompatible. You’ll have to pay your money and take your chances. To cause investors even more discomfort, almost all innovation comes from small start-ups. They far outpace the level of innovation coming out of corporate America. So if you’re looking to capitalize on the growth of the Internet, don’t look for stability. It’s the wrong place to look.

Don’t Think Recession, Think Resetting

I was listening to an interview the other day and heard the best piece of economic news I’ve heard in over 2 years. The person being interviewed was talking about changes in urbanization in North America and he said he doesn’t think of the current economic situation as a recession, he thinks about it as a resetting of the economy. That got me thinking.

His point was that in the two most dramatic economic pull backs in the last two centuries, there was a corresponding seismic shift in how we worked and how and where we lived. And after the pain of resetting, the world emerged and prospered for a significant period of time.

Consider the economic turmoil of the 1870’s. By all accounts the world was in economic ruin. The colonial empires of Europe were beginning their long, slow decline. The largest bank in the US, Jay Cooke and Company, failed. The speculative bubble after the civil war burst. Labor unrest was epidemic, leading to riots in Chicago, San Francisco, Pittsburgh and New York.

Or the Great Depression of the 30’s, the economic disaster that’s still only a generation or two away for most of us. A stock market collapse, followed by a banking collapse, followed by massive business closures and unemployment.

But the fact is, significant change and yes, advancement, came from both these periods. In the 1870’s, an agrigarian society moved to an industrial one, significantly increasing our production capabilities, creating the huge factories and huge relocation from rural areas to the dense urban centers. Immigration swelled North America with millions determined to create a better life. There was massive change, which always brings pain and unrest, but also advancement. One can’t seperate the two. They come as a package.

As the world emerged from the Great Depression and the Second World War, we began the move to the suburbs and the Great American Dream, brought to you by Kelvinator, Pontiac, Maytag and hundreds of other bread and butter brands. A second wave of immigration brought new dreams and aspirations to our borders.

Techonology always moves faster than humans. And, in the shift, entire societal frameworks have to be reinvented. This never happens incrementally or smoothly. History has shown us that existing infrastructures have to be torn down and new ones erected. Through the process, human emotions run rampant, which flood our ever so fragile economy. This has always been the way, and it will always be the way, because we are who we are. Our mental hardware hasn’t changed in thousands of years.

But in this reinvention, this resetting, we build the foundations for the next stage of our ongoing story. And in this regard, there are tremendous reasons for economic hope. If you rise above the micro view and look at the macro picture, the efficiency of the digital marketplace is extraordinary and will provide the greatest boost to our productivity in history. Forces of globalization are leveling wealth distribution and the tide is raising all boats. Science is on the verge of hundreds of life altering breakthroughs on almost every front. The global standard of living has never been higher, along with life expectancies and levels of education and health care. The challenges are not so much economic. There we just have to rebuild sustainable infrastructures to accommodate the new realities of enhanced potential and get rid of some nasty habits of over consumption. And while we’re working through the process we have to make sure we don’t rape our planet beyond repair.

The world is not in bad shape. We just have some significant house cleaning to do. This will not be fast (we’re in the middle of a huge transition shift, so think decades, not years) nor will it be painless. But if we handle it correctly, it could be the biggest jump forward in history.

Happy Birthday – Charles Darwin!

darwinToday’s the day. Charles Darwin’s 200th Birthday. And this year also marks the 150th Anniversary of the publication of On the Origin of Species. It’s an interesting comment on Darwin’s personality that although he formulated the theory in his twenties aboard the HMS Beagle, it took him another 2 decades to screw up the courage to publish it. And, in the end, it was only competitive pressure from Alfred Wallace and a not insignificant amount of urging from Darwin’s contemporaries that pushed him to go public with the Theory of Natural Selection. Darwin knew it would be a conceptual bombshell of epic proportions in Victorian England. He wasn’t wrong. Repercussions are still felt today.

But it also marked one of the most significant shifts of scientific thinking in history. As Theodosius Dobzhansky said in 1973, “Nothing in Biology makes sense but in the light of Evolution“. Since the publication, Darwinian thinking has been applied to everything from Artificial Intelligence to Civic Planning to Neural Development to Computer Games. The concept of emergence in complex systems is simple and elegant yet vast in it’s implications. It could well mark the most important  and change inducing conceptual framework for this century.

I find it amazing that today in America, more people believe in the Devil and angels than in the theory of Evolution, according to a recent Harris poll. One of those American’s was recently running for Vice President. According to the same poll, Evolution does now edge out Creationism (47% vs 42%) but is not that far ahead of belief in ghosts (44%) and UFOs (36%). It just shows how beliefs will trump rationalism. Darwin’s theory is a classic example of parsimony: a simple idea that is breathtakingly profound.

So, I offer a sincere Thank You and Happy Birthday to the quiet and gentile biologist that was born 200 years ago today in Shrewsbury, England. Well done Charles, well done.

Evolution in the Face of Adversity

First published January 15, 2009 in Mediapost’s Search Insider

I am an unrepentant Darwinist, which probably doesn’t surprise anyone who reads my columns on a regular basis. The whole topic of evolution and emergent behaviors in complex systems constantly fascinates me. As Steven Johnson pointed out in his recent book, “Emergence,”  the theme of patterns rising from complexity is  ubiquitous and could well define the 21st century.

The World is a Cruel Place – Get Over It!

One of the most interesting things about evolution is that the pace of evolutionary change picks up in the face of adversity. The more hostile the environment, the faster the wheels of evolution roll and the quicker we adapt. Of course, we do so in a pretty ruthless way. The weak get culled faster. There are no consolation prizes in this lottery. Winner takes all. Richard Dawkins didn’t call genes “selfish” for nothing.

Which led me to apply the rules of biology to our current marketplace. We are going into what may be the most hostile environment for marketers in recent memory. Expect losers to die faster and winners to adapt quicker. But it’s just such an adverse environment that ultimately decides the survival of the fittest. After all, our marketplace is just one more complex system where emergence again plays out.

When the Going Gets Tough

We’ve seen the groundswell of change wash over marketing in the last decade or so. Inexorably, the digital sea change has already started to determine winners and losers, but when ad budgets were fatter, there was more room for everyone. Now, as those budgets are dramatically scaled down, advertisers are forced to make tough decisions.  Channels have to prove themselves against tougher standards. There will be fewer winners and more losers and the evolution of the marketplace will pick up dramatically.

In the end, this will be good for most of the digital marketplace, especially search. Already with our client list, we’ve seen tough budgeting decisions dramatically impact more traditional channels but leave search relatively unscathed.

Scarcity Eliminates Stupidity

Another outcome of the financial meltdown will be that only the smartest marketers will survive. A few years ago, I remember someone from one of the largest advertisers in North America once saying to me, out of frustration with  their marketing program, “We’re so big we can afford to be stupid.”  No more. Today, only the smartest will survive. Size is no longer a guarantee of survival, nor a justification for stupidity, as we’ve seen in a number of particularly painful examples.

Smarter marketers will make smarter decisions, including the painful ones.  They will be ruthless about culling out the losers. Which means chronic mediocrity will become acute failure;  the mortality rate will rise substantially. This will drive our marketing models into the future much faster.

Strategies for Survival

How do you emerge on the winning side of the Darwinian lottery? Based on what I’ve seen, you won’t go far wrong if you concentrate on the following:
–    Accountability for and transparency in delivering on advertising objectives.
–    Understanding the intent and behavior of your target market.
–    A ruthless focus on efficiency in getting the right message to the right person at the right time.
–    Effectively leveraging a fundamental understanding of how the marketplace is shifting due to technology.
–    The ability to map out the most effective prospect touch points, and strong integration between all the channels found at these touch points.
–    The ability to collect and utilize all possible intelligence sources.
–    An ability to brutally assess the reality of the environment and execute quickly and effectively against these realities.

It’s the last of these factors I’d like to focus on for my final thoughts on this topic. In a hostile environment, negativity comes with the territory. The winners will seek out negativity as an important indicator of the true situation and will use it to adapt. In this case, the fittest will see things as they are, not as they wish they would be. In coming months and years, the difference between these two viewpoints will be critical.

Zappos New Business Model: Have Insight, Will Respond

A story this morning in Adweek about Zappos reminded me of a recent experience with a client. I’ll get to the Zappos story in a moment, but first our client’s story.

This customer wanted to set up a client summit at Google’s main office in Mountain View. Attending the summit were not only their search team but also some highly placed executives. The reason for the summit was ostensibly to talk about the client’s search campaign, but it soon became apparent that the executives were looking for something more. They had specifically asked for someone to spend some time talking about Google’s culture.

Throughout the day, Google paraded a number of new advertising offerings in front of the team. While the front line teams were intrigued, one particular senior executive seemed to be almost snoozing through the sales pitches for Google’s new advertising gadgets and gizmos. It was only when the conversation turned to Google’s business practices that the executive perked up, suddenly taking volumes of notes. It made me realize that sometimes, it’s not only what we sell that has value for our customers, it’s what we are. I chatted about this recently with someone from Google, saying that their corporate philosophy and way of doing business is of interest to people. I urged him to find a way to package it as a value add for customers. While he agreed the idea was intriguing, I think it got relegated to the “polite jotting down without any intention of acting on it” category.

Now, back to the Zappo’s story. That’s exactly what they’re doing, taking their customer service religion and packaging it so that thousands of businesses can learn by going directly to the source. Zappos Insights is a subscription service ($39.95 per month) that let’s aspiring businesses ask questions about the “Zappos way” and get answers from actual Zappos employees.

The service, said CEO Tony Hsieh, is targeted at the “Fortune 1 million” looking to build their businesses. “There are management consulting firms that charge really high rates,” he said. “We wanted to come up with something that’s accessible to almost any business.”

It’s a pretty smart move. There’s no denying we’re going through a sea change in how business is done. And I’ve always felt that there’s a impractical divide between consultants and businesses that are consistently implementing every day. It seems like you can either do, or teach, but not both. Amazing stories such as Apple, Google, Southwest and Zappos have shown that innovation with culture is as important as innovation in what ends up in the customer’s hands. Zappos is trying to blend the two in an intriguing revenue model.