Catching Travel by the Long Tail

It’s been 13 years since then-Wired Editor in Chief Chris Anderson wrote his book “The Long Tail.” His analysis of the “Amazon Economy” completely flipped our notions of supply and demand. In theory, The Long Tail should have ushered in a democratization of the marketplace, spreading the wealth among a greater number of participants. And, in a perfect implementation of the Long Tail, that would be true. But bits and pieces of Long-Tail economics have ported over to a number of markets — and sometimes, an imperfect fit creates some undesirable consequences.

Long-Tail Economics

In order to create an effective Long-Tail market, three conditions have to be met.

Unlimited inventory: Products that can be delivered digitally with no manufacturing costs free markets from the physical restraints of production and warehousing. Inventories are unlimited and fulfillment can be on demand.

Unlimited shelf space: Similarly, products in the digital domain allow for infinite shelf space — simply because no actual “space” is required. Spotify, Netflix and Amazon can make millions of digital copies available.

Perfect information: The last requirement is sometimes the most problematic. In order for the Long Tail marketplace to be the most effective, consumers need perfect information about their options. They need to know everything about anything that’s available and be able to make their choice accordingly.

This is impractical in the real world. Even the most effective search platform falls well short of providing perfect information.

Theoretically, if all three prerequisites are met, demand flows down from the head to the tail, shortening the first and extending the second. But Long-Tail economics don’t necessarily apply equally to every marketplace. Take travel, for instance.

Too Much of a Good Thing

In a recent MediaPost column looking at marketing travel, Harvey Chipkin outlined the problems being felt worldwide by “overtourism.”  Barcelona is a cautionary tale of what happens when consumers are deluded by the illusion of a Long-Tail market and suppliers are dealing with the realities of an infrastructure held back by physical constraints.

First, let’s deal with the delusion. We travel a lot differently than our parents did. Back in the ’80s, travel to Europe was the sole domain of the rich and famous. If one of us mere mortals did hit the continent, chances were we were doing the European Bus Tour Trifecta: London, Paris and Rome. For most of us, Disneyland was about as exotic and adventurous as our travel plans got.

But then we started craving authentic experiences. We wanted the thrill of unearthing the hidden gem. That was about the time we discovered Barcelona.

No one went to Barcelona in 1990. But then the city hosted the Olympics in 1992. This exposure on the world stage boosted tourism, effectively doubling it by 2000. Barcelona was cool, it was hip — and, most importantly, our next-door neighbors had never been there.

But it was the Long Tail of travel that really broke the back of Barcelona when it came to tourism. From 2000 to 2010, with the advent of the web and the explosion of available travel information, tourism to Barcelona again doubled and almost tripled.

Today, about 20 million annual visitors flock to a city with a population less than one tenth that number. The city is groaning under the weight of all those sun-burned bodies desperately searching for authenticity, to the point that Barcelona’s mayor, Ada Colau, is threatening to slam the door on those gringo turistas in order to make the city livable again.

The delusion of the Long Tail leads us to believe there’s a smorgasbord of authentic travel options just waiting for us. But the reality falls far short of that. If we look at the prerequisites of a Long-Tail market, we begin to see why.  We can argue that there is unlimited shelf space. There is no corner of the world we can’t travel to if we have the budget and inclination. Destinations we never heard of just a few decades ago are now the new hot spots.

Perfect information is a little more of a challenge. When the options are limitless, we run into the limits of our own cognition. Working memory being what it is, we can’t endlessly juggle potential destinations. We rely on a search and suggestion engine like TripAdvisor. And there we run into the realities of the Matthew Effect: The rich tend to get richer and the poor get poorer. This can be otherwise stated as the Rule of Google: “No one goes past the first page.” Shelf space may be unlimited, but screen real estate is anything but.

Finally, as Barcelona is painfully discovering, there are definite limits to the inventory of authentic, one-of-a-kind travel experiences. Once, visiting La Sagrada Familia Basilica was an awe-inspiring, soul-stirring spiritual journey. Today, it’s a highly manufactured tourism machine that usually sells out for the day by 9 a.m.

This means that rather than the trickle-down effect we would hope to see in a Long-Tail market, demand tends to bunch up due to network effects. A new “authentic” experience climbs to the top of the listing and is suddenly inundated with new demands.

As Chipkin said in his column: “After a few people get the privilege of cooking with a Contessa in her ancestral home or taking in a remote tribal village … these “authentic” locals (and their neighbors) begin to catch on and think like entrepreneurs. In come the value engineers and the souvenir shops … and out goes the authenticity.”

Seeking Sustainability

The Barcelona effect is beginning to be seen everywhere, including my own little corner of Canada. Forward-thinking tourism marketers are trying to get ahead of the deluge by finding ways to push traffic to the less-popular margins, artificially creating a Long-Tail effect. Labels like “slow tourism” and “immersive travel” are emerging to try to encourage a different mindset among visitors. But, in the end, most tourism operators are still trapped within the tyranny of TripAdvisor mindset, hoping to climb to the top of the rankings. They feel the potential trade-off is worth it.

To them, being “too popular” sounds like a tomorrow kind of problem.

Lee Iacocca and the Celebrity CEO

The recent passing of Lee Iacocca (on July 2) got me thinking about the celebrity CEO phenomenon. This is a sign of our times — our obsession with celebrity. Iacocca was not the first celebrity CEO, but he certainly ushered in a new era of personalized corporate brand building.

With Iacocca, having a bigger than life CEO went from being an oddity to a corporate expectation. In an article on Bloomberg.com, writer Joe Nocera notes, “Yes, there had been other famous corporate chieftains before Iacocca — John D. Rockefeller and Walt Disney come to mind — but they were the exceptions to the rule that CEOs should be low-key, boring even. Iacocca made it okay for a chief executive not just to gain fame, but to desire it.”

If you read any of the tributes to Iacocca, he is credited with:

  • Introducing the concept of auto loans
  • Creating the Ford Mustang
  • Introducing the Minivan
  • Saving Chrysler

But perhaps Iacocca’s biggest legacy was paving the way for celebrity CEOs who would follow in his footsteps. By stepping out from behind the mahogany desk and in front of the camera, he created the mold that would later turn out Steve Jobs, Bill Gates and Elon Musk.

My intention is not to take anything away from these leaders. It’s just to put things in perspective.

How Much Influence Does a CEO Really Have?

We love a great story, and one of the foundations of a story has always been the hero. We find the hero’s journey a compelling narrative arc, and we tend to ascribe heroic qualities without necessarily making sure our anointed heroes have the right qualifications. This is certainly true in the corporate world.

Phil Rosenzweig’s extraordinary book, “The Halo Effect,” strips the compelling narratives away from corporate success stories. He urges us to take a more scientific approach to determining what really works. And when we apply some scientific rigor to the concept of a celebrity CEO, we find (according to two studies Rosenzweig cites in his book) that the actual influence of a leader on the success of a company is between 4% and 10%.

A 10% swing is nothing to sneeze at. It’s certainly statistically significant. And this is an average over a number of companies in the study. I suspect if one was to accurately measure the influence of a Steve Jobs or Lee Iacocca on their companies, it could be much higher.

But when we consistently confuse correlation and causation and automatically give a celebrity CEO all the credit for a company’s success, we could be making an attribution error. We are giving short shrift to all the other factors that may have led to that success. We are applying a simple answer to a complex question. And we humans tend to do that — a lot.

The Cult of Personality

When we make this mistake while looking backwards, it’s one thing. But when we move forward under this mistaken assumption, it’s quite another. We fall victim to the oversimplification of the “great man theory,” where we believe history can pivot on the capabilities of one person. We also run the very real risk of creating a cult of personality.

The idea of the personality cult came from a speech by former Soviet Union Premier Nikita Khrushchev. In it, he criticized the idealization of Joseph Stalin and Mao Zedong. When a populace believes that one person has the power to right all wrongs, it confers on that person a frightening amount of authority. It also condones the mechanisms required to consolidate power in the hands of that person.

Wikipedia outlines the typical path that leads to a cult of personality:“(it) arises when a country’s regime – or, more rarely, an individual – uses the techniques of mass media, propaganda, the big lie, spectacle, the arts, patriotism, and government-organized demonstrations and rallies to create an idealized, heroic, and worshipful image of a leader, often through unquestioning flattery and praise.” 

Mistaking Charisma for Competency

Even if we do accept that the right person may make all the difference, we then come to the issue of how we’d recognize that person when we see them. Again, we run into the fallacy of the “Halo Effect.”

When we don’t have (or want) empirical evidence of a person’s competence, we look for a proxy signal for that competence. That’s why CEOs of Fortune 500 companies are generally two-and-a-half inches taller than the average American. Its why good-looking people are assumed to be kinder and more compassionate. And — if we’re looking for a leader — it’s why we believe charisma equals competency. We are often wrong about this. In fact, there’s probably a better chance that charisma goes hand in hand with sociopathy.  Oops.

I do believe that we have been blessed with some extraordinary corporate leaders. And some of these have deservedly become celebrities. Lee Iacocca was probably one of these.

But I also believe we are walking down a dangerous path when we believe this is the rule rather than the exception. To succeed in solving complex problems — which defines almost every problem we face — we need complex solutions. And those solutions almost never come in the form of one person. To believe they do is to ignore the true scope of the issue.

Is There Still Room In Today’s Marketing World For Rick Steves?

U.S. travel writer and TV personality Rick Steves is — well, there’s no really kind way to put this — a weenie.

His on-air persona (on “Rick Steves’ Europe”) is a mix of high school social studies teacher, khaki-clad accountant cracking Dad jokes — and the guy you get stuck next to at a museum lecture on 16th century Venetian architecture that your wife made you go to.

According to a recent profile in The New York Times, he’s “one of the legendary PBS superdorks — right there in the pantheon with Mr. Rogers, Bob Ross and Big Bird.”

Rick Steves is undoubtedly a nice guy — Ned Flanders (of “The Simpsons” fame) nice. He’s not the guy you’re going to invite to your stag party in Las Vegas — not unless you were planning a prank involving prostitutes, illicit drugs and an involuntary neck tattoo. But Ed Helms already had that role.

Despite all this — or perhaps because of it — Steves is one of the most trusted travel brands in the U.S. and Canada. His name appears prominently on countless guide books, podcasts, seminars, a weekly syndicated column and the perennially running PBS series.

It was the last of these that brought him top of mind for me recently. He was hosting a fund-raising marathon this past weekend on my nearest PBS affiliate, KCTS in Seattle. And as Steves good-naturedly bumbled his way through Tuscany, I asked myself this question: “Could Rick Steves be a start-up brand today?”

Yes, he is a successful brand, but could he become a successful brand from a standing start? In other words, can a weenie still win in today’s world?

Today, everything needs to be instantly shareable. Branding is all about virality. Things that live at the extremes are the ones that spread through social networks. We are more Kanye West and Kim Kardashian than we are Danny Kaye and Doris Day. That was then. This is now.

You can’t ignore the fact that Steves’ target market is well north of their 50thbirthday. They are the ones who still remember who Danny Kaye and Doris Day were. So I ask again: Is being passionate and earnest (two things Rick Steves undoubtedly is) enough to break our collective ennui in today’s hyperbolic world?

I ask this question somewhat selfishly, for I, too, am a weenie. I have long lived on the dorkish end of the spectrum. I like me a good dad joke (e.g., People in Athens hate getting up early. Because Dawn is tough on Greece). And I have to wonder. Can nice, decidedly un-cool people still finish first? Or  at least not last?

It’s an important question. Because if there is no longer room in our jaded awareness for a Rick Steves, we’re missing out on something very important.

Steves has won his trust the hard way. He has steadfastly remained objective and unsponsored. He provides advice targeted at the everyday traveler. He is practical and pragmatic.

And he is consistently idealistic, believing that travel pries open our perspective and makes us better, more tolerant people. This mission is proudly stated on his corporate website: “We value travel as a powerful way to better understand and contribute to the world in which we live. We strive to keep our own travel style, our world outlook, and our business practices consistent with these values.”

This is no “flash-in-the pan” brand bite crafted for a social share. This is a mission statement backed by over 40 years of consistent delivery to its ideals. It’s like Steves himself: earnest, sincere, thoughtful and just a little bit dorky.

If you ask me, the world could use a little less Kanye West and a little more Rick Steves.

The Dilemma of the Middle Aged Marketer

Today is my birthday. I still call myself middle-age, but truth be told, I passed being middle-aged some time ago. I would more accurately be called two/thirds-aged (hopefully).

 That’s not the only half-truth I’m hanging on to.

When new people I meet ask me my profession, I like to say I’m a “reformed marketer.” In addition to being somewhat untruthful, I also realize now that this response is pretentious on many different levels.

First of all, it gives off this “holier than thou” vibe that’s a little off-putting.

Secondly, if I regret being a marketer so much, why am I still hanging on for dear life to that particular epithet? The people I’m being introduced to now often have no idea of my past. The fact that I once called marketing my career has no relevance to them. They could care less. I’m just saying it for effect.

That’s a little sad.

If I dig way down to the truth, I have to admit being a marketer defined me for most of my life. I loved influencing people. I adored my career. And I’m not ready to let that part of me go.

Calling myself a reformed marketer gives me the illusory comfort of still hanging on to something important to me, but holding it at arm’s length, like a disease I’ve recovered from. I’m trying to play both ends against the middle.

And thus comes the Middle Aged Marketer’s Dilemma. It hit me in my 40s.

In last week’s column, I started talking about “Why” vs the other 4 Ws: “Who, What, When and Where.” I have a love/hate relationship with “Why.” It was that damned “Why” that ushered in the Dilemma.

As I said, I loved “What” I did as a marketer. It was endlessly challenging and fascinating. And if you love “What” enough, you don’t really care so much about “When” and “Where.” You’ll work ridiculously long hours in whatever location your career takes you.

I even came to terms with “Who.” I loved most of my clients. The few I didn’t, I managed to either cut loose or build a big enough buffer so that they didn’t make my life too miserable for too long. Those 4 Ws allowed me to carve out a pretty fantastic life for myself.

But then came along that damned “Why.” It was innocent at first. My “whys” had a limited and very applied scope. They were specific to the work I did for my clients. They allowed me to add another dimension to the market research we were doing for others. The more I asked “why,” the more I wanted to learn about how people ticked. I loved “what” I was doing even more.

Then my “why” flipped on me and went for the jugular. It has a habit of doing that. I made the mistake of asking myself why I was doing what I did for a living.

It’s a tough question. I don’t think many of us want to go gentle into that good night without having sussed for ourselves a pretty good reason why we have lived our lives.  And when middle-aged marketers asks themselves “why,” a satisfying answer does not immediately spring to mind.

“So I could help profit-obsessed companies sell more shit to people who don’t need it” is not exactly a sterling argument for canonization.

And yes, I did just toss everything about marketing into the same over-generalized bucket. Quibble if you will. I know there are exceptions. If you navel-gaze long enough, you’re sure to find them. But I’ll stand by my struggle with “why,” if you can stand by yours.

Today, I’m still struggling with the Dilemma. The fact that I’m still writing this column week after week speaks to my inability to let the past go. I remain totally in love with the “what” of marketing, but have ethical issues with the “why.”

I do believe marketing is built upon the questionable edifice of consumerism — and I’m not sure there’s a lot of moral high ground we can lay claim to.We work (or, in my case, did work) in an industry that depends on humans having baser instincts.

Data does NOT Equal People

We marketers love data. We treat it like a holy grail: a thing to be worshipped. But we’re praying at the wrong altar. Or, at the very least, we’re praying at a misleading altar.

Data is the digital residue of behavior. It is the contrails of customer intent — a thin, wispy proxy for the rich bandwidth of the real world. It does have a purpose, but it should be just one tool in a marketer’s toolbox. Unfortunately, we tend to use it as a Swiss army knife, thinking it’s the only tool we need.

The problem is that data is seductive. It’s pliable and reliable, luring us into manipulation because it’s so easy to do. It can be twisted and molded with algorithms and spreadsheets.

But it’s also sterile. There is a reason people don’t fit nicely into spreadsheets. There are simply not enough dimensions and nuances to accommodate real human behavior.

Data is great for answering the questions “what,” “who,” “when” and “where.” But they are all glimpses of what has happened. Stopping here is like navigating through the rear-view mirror.

Data seldom yields the answer to “why.” But it’s why that makes the magic happen, that gives us an empathetic understanding that helps us reliably predict future behaviors.

Uncovering the what, who, when and where makes us good marketers. But it’s “why” that makes us great. It’s knowing why that allows us to connect the distal dots, hacking out the hypotheses that can take us forward in the leaps required by truly great marketing. As Tom Goodwin, the author of “Digital Darwinism,” said in a recent post, “What digital has done well is have enough of a data trail to claim, not create, success.”

We as marketers have to resist stopping at the data. We have to keep pursuing why.

Here’s one example from my own experience. Some years ago, my agency did an eye-tracking study that looked at gender differences in how we navigate websites.

For me, the most interesting finding to fall out of the data was that females spent a lot more time than males looking at a website’s “hero” shot, especially if it was a picture that had faces in it. Males quickly scanned the picture, but then immediately moved their eyes up to the navigation menu and started scanning the options there. Females lingered on the graphic and then moved on to scan text immediately adjacent to it.

Now, I could have stopped at “who” and “what,” which in itself would have been a pretty interesting finding. But I wanted to know “why.” And that’s where things started to get messy.

To start to understand why, you have to rely on feelings and intuition. You also have to accept that you probably won’t arrive at a definitive answer. “Why” lives in the realm of “wicked” problems, which I defined in a previous column as “questions that can’t be answered by yes or no — the answer always seems to be maybe.  There is no linear path to solve them. You just keep going in loops, hopefully getting closer to an answer but never quite arriving at one. Usually, the optimal solution to a wicked problem is ‘good enough – for now.’”

The answer to why males scan a website differently than females is buried in a maze of evolutionary biology, social norms and cognitive heuristics. It probably has something to do with wayfinding strategies and hardwired biases. It won’t just “fall out” of data because it’s not in the data to begin with.

Even half-right “why” answers often take months or even years of diligent pursuit to reveal themselves. Given that, I understand why it’s easier to just focus on the data. It will get you to “good,” and maybe that’s enough.

Unless, of course, you’re aiming to “put a ding in the universe,” as Steve Jobs said in an inspirational commencement speech at Stanford University. Then you have to shoot for great.

The Gap Between People and Platforms

I read with interest fellow Spinner Dave Morgan’s column about how software is destroying advertising agencies, but not the need for them. I do want to chime in on what’s happening in advertising, but I need a little more time to think about it.

What did catch my eye was a comment at the end by Harvard Business School professor Alvin Silk: “You can eliminate the middleman, but not his/her function.”

I think Dave and Alvin have put their collective thumbs on something that extends beyond our industry: the growing gap between people and platforms. I’ll use my current industry as an example – travel. It’s something we all do so we can all relate to it.

Platforms and software have definitely eaten this industry. In terms of travel destination planning, the 800-pound Gorilla is TripAdvisor. It’s impossible to overstate its importance to operators and business owners.  TripAdvisor almost single-handedly ushered in an era of do-it-yourself travel planning. For any destination in the world, we can now find the restaurants, accommodations, tours and attractions that are the favorites of other travellers. It allows us to both discover and filter while planning our next trip, something that was impossible 20 years ago, before TripAdvisor came along.

But for all its benefits, TripAdvisor also leaves some gaps.

The biggest gap in travel is what I’ve heard called the “Other Five.” I live in Canada’s wine country (yes, there is such a thing). Visitors to our valley – the Okanagan – generally come with 5 wineries they have planned to visit. The chances are very good that those wineries were selected with the help of TripAdvisor. But while they’re visiting, they also visit the “other five” – 5 wineries they discovered once they got to the destination. These discoveries depend on more traditional means – either word of mouth or sheer serendipity. And it’s often one of these “other five” that provide the truly memorable and authentic experiences.

That’s the problem with platforms like TripAdvisor, which are based on general popularity and algorithms. Technically, platforms should help you discover the long tail, but they don’t. Everything automatically defaults to the head of the curve. It’s the Matthew Effect applied to travel – advantage accumulates to those already blessed. We all want to see the same things – up to a point.

But then we want to explore the “other five” and that’s where we find the gap between platforms and people. We have been trained by Google not to look beyond the first page of online results. It’s actually worse than that. We don’t typically scan beyond the top five. But – by the very nature of ratings-based algorithms – that is always where you’ll find the “other five.” They languish in the middle of the results, sometimes taking years to bump up even a few spots. It’s why there’s still a market – and a rapidly expanding one at that – for a tour guided by an actual human. Humans can think beyond an algorithm, asking questions about what you like and pulling from their own experience to make very targeted and empathetic suggestions.

The problem with platforms is their preoccupation with scale. They feel they have to be all things to all people. I’ll call it Unicornitis – the obsession with gaining a massive valuation. They approach every potential market focused on how many users they can capture. By doing so, they have to target the lowest common denominator. The web thrives on scale and popularity; the rich get richer and the poor get poorer. Yes, there are niche players out there, but they’re very hard to find. They are the “other five” of the Internet, sitting on the third page of Google results.

This has almost nothing to do with advertising, but I think it’s the same phenomenon at work. As we rely more on software, we gain a false confidence that it replaces human-powered expertise. It doesn’t. And a lot of things can slip through the gap that’s created.

 

Why We’re not Ready for AI to Take the Wheel…Yet

It’s interesting to see how we humans assign trust.

Consider the following scenario. At any time, in any city in the world, you will put your life in the hands of a complete stranger in an environment you have no control over without a second thought. We do it every time we hail a cab. We know nothing about the driver or their safety record. We don’t know if they’re a good person or a psychopath. We place trust without any empirical reason to do so.

Yet a number of recent surveys indicate the majority of us don’t trust self-driving cars. A recent survey by AAA found that 71% of us would be afraid to ride in a fully self-driving vehicle. I’m one of them. I’m not sure I could slam the door on a self-driven Uber and relax in the back seat while AI takes the wheel. Yet I pride myself on being a fairly rational person and there are plenty of rational reasons why self-driving cars should be far safer than the human powered equivalents.  Even the most skeptical measured comparisons call it a toss-up.

And that brings us to key point- we don’t assign trust rationally. We do it emotionally. And emotionally, we have a tortured relationship with technology.

The problem here is two-fold. First, our trust mechanisms are built to work best when we’re face-to-face with the potential recipient of trust. Trust evolved to be a human-dependent process. And that brings us to the second problem. Over the last thousand years or so, we have learned how to trust in institutions. But that type of trust is dissolving rapidly.

Author and academic Rachel Botsman has spent over a decade looking at how technology is transforming trust. In an interview with Fast Company, she unpacks this notion of imploding institutional trust, “Whether it’s banks, the media, government, churches . . . this institutional trust that is really important to society is disintegrating at an alarming rate. And so how do we trust people enough to get in a car with a total stranger and yet we don’t trust a banking executive? “

I think this transformation of trust has something to do with the decoupling phenomenon I wrote about last week. When we relied on vertically integrated supply chains, we had no choice but to trust the institutions that were the caretakers of those chains. But now that our markets have flipped from the vertical to the horizontal, we are redefining our notions of trust. We are digitally connecting with strangers through sharing economy platforms like AirBnB and Uber and, in the process, we are finding new signals to indicate when we should trust and when we shouldn’t.

There is another unique aspect to our decision to trust. We tend to trust when it’s expedient to do so. Like so many things in human behavior, trust is just one factor wrapped up in our ongoing risk vs reward calculations. Our emotions will push us to trust when it’s required to get what we want. The fewer the alternatives available to us, the more we tend to trust.

Our lack of trust in self driving vehicles is a more visceral example. I don’t think anyone believes the creators of self-driving technology are out to off our species in a self-driven version of a Mad Max conspiracy. We just aren’t wired to trust machines with our lives. There is an innate human hubris that believes that when it comes to self-preservation, our fates are best left in our hands.

Self-driving proponents believe that with time and exposure, these trust issues will be resolved. The trick to us trusting machines with our lives is to lull us into not thinking about it too much. Millions of us do it every day when we board an airplane. The degree to which our airborne lives are dependent on technology was tragically revealed with the recent Boeing Max incidents. The fact is, if we had any idea how much our living to see tomorrow is dependent on technology, we would dissolve into a shuddering, panic-stricken mess. In this case, ignorance is indeed bliss.

But there are few times when we have to make the same conscious decision to put our lives in the metaphorical hands of a computer to the extent we do in a self-driven car. If we look at how we decide to trust, this an environment strewn with psychological landmines. Remember, we tend to trust when we have no options. And in this case, our option couldn’t be clearer. The steering wheel is right there, begging us to take over. It freaks us out then the car pulls away from the curb and we see the wheel start turning by itself. It’s small wonder that 71% of us are having some control issues.