Dr. Martin Luther King, Jr.
Heard Hugh Downs say this morning:
"When I interviewed Dr. Martin Luther King, Jr. I realized he wasn't working for the black race; he was working for the human race."
Profound & powerful.
TPSayin'
My thoughts and observations on marketing, business and life.
So, What's Your Algorithm?
I love the line "Business people have been having such fantasies of rationalism for decades." This is particularly true with marketers who have wondered how to best reach customers…and in an affordable manner. Those in advertising have often shunned such rationale & empirical thinking in the interest of preserving their swanky perch high above the marketing food chain.
Well no more, folks. The era of data, analytics, algorithms, optimizations, predictors and decision sciences is here. Big time. Dashboards & mobile devices will streamline the reporting of said intelligence. And marketing channels that deliver far more return than advertising - social, word-of-mouth, etc. - will prevail.
~ TPS
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By DENNIS K. BERMAN
We are ruined by our own biases. When making decisions, we see what we want, ignore probabilities, and minimize risks that uproot our hopes.
What's worse, "we are often confident even when we are wrong," writes Daniel Kahneman, in his masterful new book on psychology and economics called "Thinking, Fast and Slow."
An objective observer, he writes, "is more likely to detect our errors than we are."
The new year will bring plenty of splashy stories about iPads and IPOs. There is a more important theme gathering around us: How analytics harvested from massive databases will begin to inform our day-to-day business decisions. Call it Big Data, analytics, or decision science. Over time, this will change your world more than the iPad 3.
Computer systems are now becoming powerful enough, and subtle enough, to help us reduce human biases from our decision-making. And this is a key: They can do it in real-time. Inevitably, that "objective observer" will be a kind of organic, evolving database.
These systems can now chew through billions of bits of data, analyze them via self-learning algorithms, and package the insights for immediate use. Neither we nor the computers are perfect, but in tandem, we might neutralize our biased, intuitive failings when we price a car, prescribe a medicine, or deploy a sales force. This is playing "Moneyball" at life.
It means fewer hunches and more facts. Think you know something about mortgage bonds? These systems are now of such scale that they can analyze the value of tens of thousands of mortgage-backed securities by picking apart the ongoing, dynamic creditworthiness of tens of millions of individual homeowners. Just such a system has already been built for Wall Street traders.
Crunching millions of data points about traffic flows, an analytics system might find that on Fridays a delivery fleet should stick to the highways— despite your devout belief in surface-road shortcuts.
You probably hate the idea that human judgment can be improved or even replaced by machines, but you probably hate hurricanes and earthquakes too. The rise of machines is just as inevitable and just as indifferent to your hatred.
Business people have been having such fantasies of rationalism for decades. Until the last few years, they have been stymied by the cost of storage, slower processing speeds and the flood of data itself, spread sloppily across scores of different databases inside one company. These problems are now being solved.
"We've just got to the point where the technology really starts to work," says Michael Lynch, chief executive of Autonomy Corp. Hewlett-Packard Co. just spent $11 billion to buy Autonomy, which vacuums up "unstructured data" then applies it to these analytic approaches.
Of course, the hype is growing fast, too. Company valuations in this space have pushed higher, and surely some will falter along the way. That won't matter much in the long run. The story of 2012 is how these technologies are inching closer to each one of us.
For a glimpse, look inside The Schwan Food Co., whose 6,000 roving sales people deliver frozen products to homes of three million customers across the country.
Schwan home sales were listless for four straight years, beset by high customer churn and inventory pileups. Over 10 months, the venerable Minnesota company began a program with the aid of Opera Solutions Inc. of New York, an eight-year-old analytics firm.
Schwan already had a crude recommendation program. Its sales people could look at six weeks of orders, and suggest purchases from that list.
The new project took it into more sophisticated territory: Matching seemingly disparate customers with similar purchase patterns in their past. Opera calls them finding "genetic twins." It also added ways to track whether customers' spending was fading from certain categories—say, breakfast foods—and offered product suggestions and discounts to keep the spending intact.
Schwan's database is now pushing out more than 1.2 million dynamically-generated customer recommendations every day, sent directly to drivers' handheld devices. Opera says Schwan's revenues are up 3% to 4% because of it.
"There is a whole class of things that couldn't be done five years ago," says Opera CEO Arnab Gupta, who just landed an $84 million venture investment from investors including Accel-KKR and Silver Lake Sumeru. His company is now valued at around $500 million. "A few years ago it might take a month to run a project involving 30 billion separate calculations. Today it can be done in two to three hours."
The big goal is to push all the heavy back-end work forward to front-line workers, often as a "dashboard" on a handheld device.
Soon, a drug saleswoman will have real-time analytics that tell her to focus on the doctors who spent time on social networks that morning, and who are thus more apt to influence colleagues, says Dhiraj C. Rajaram, founder of analytics company Mu Sigma, of Northbrook, Ill. Last week Mu Sigma raised $108 million in venture funding from General Atlantic and Sequoia Capital.
A warning awaits, of course. As Mr. Rajaram explains, analytics will eventually become the norm, which will push adaptation and business cycles even faster than they are today. "As computers become better and better, our lives are becoming more and more complex. They create new problems as much as they solve old ones."
Until then, we should take some comfort—however difficult it may feel—that machines will help us eliminate our worst human tendencies. Mr. Kahneman reminds us best: "We often fail to allow for the possibility that evidence that should be critical to our judgment is missing. What we see is all there is."
The Game is a regular column covering the future of business. Follow on Twitter @dkberman or write to dennis.berman@wsj.com.
Read more: http://online.wsj.com/article/SB10001424052970203462304577138961342097348.html#ixzz1itbySGRO
Mad Men-Era DDB Alumni Reunite, Start Consultancy
This is the smartest thing I've read from the ad agency world in a while. It's smart, authentic and logical. I wish these guys many years of success.
~ TPS
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Mad Men-Era DDB Alumni Reunite, Start Consultancy
'Senior Creative People' Will Focus on Marketing to Those Over 60
When a group of '60s-era creatives from Doyle Dane Bernbach held a reunion this summer, little did they know it would lead to a return to the ad business.
But that's just what has happened for a quartet of old-school admen -- Chuck Schroeder, Don Blauweiss, Ed Griles and Sid Myers -- who this week launched a new marketing consultancy that, rather appropriately, is focused on advising marketers on targeting the 60-and-over set. It's a demographic that the group contends younger creatives today aren't adequately equipped to understand.
The name of the new firm is cheeky, but also rings literally accurate: Senior Creative People.
Part of the impetus behind the group lies in an aging population: As baby boomers are entering the senior-citizen designation, they're considered to be a viable target with spending power.
Chuck Schroeder
"Agencies and marketers are trying to figure out how to speak to an audience they ignored before," Mr. Schroeder, 68, told Ad Age. In his view, marketers aren't spending much time or putting forth the effort to make advertising resonate with seniors, and that could hurt them in the long run. Senior Creative People will offer strategic consulting and creative execution. "Essentially what we want to do is sit down with a client and offer what it's like to be a senior, because that's what we're uniquely qualified to do."
All four men, now in their 60s and 70s, are alums from a time when DDB's Bill Bernbach prompted a so-called creative revolution in advertising. During their tenure, they worked on a swath of iconic campaigns including President Johnson's 1964 presidential campaign ad "Daisy" and the "Think Small" and "Lemon" print ads for Volkswagen. Collectively, they have experience working on brands that range from Johnson & Johnson and IBM to Credit Suisse to Whirlpool and Alka-Seltzer.
"We offer a dimension that the agencies don't have, and perhaps don't want to get involved with," said Mr. Schroeder. He contends many talented and younger creatives think they can write copy that resonates with older groups, but that's usually not the case.
For now, most of the people joining the firm will be DDB veterans, but as time goes by, Senior Creative People will likely recruit people with different agency backgrounds.
Senior Creative People is also starting a mentoring program that by the start of the new year should have four colleges on board: one each in New York, Los Angeles and ideally Chicago, as well as Alberta College of Art & Design in Calgary. The mentoring program currently has no name. Mr. Schroeder said they were tossing around "Mad Mentors," but that name was already taken.
"We came out of a social-change generation, and it's still in us," said Mr. Schroeder. While the group is taking their return to Madison Avenue seriously, in the end, it's lighthearted. We are "hoping to effect change, make a few dollars and have some fun."
Unhate
Provocative & brilliant. http://brightcove.vo.llnwd.net/pd18/media/694922499001/694922499001_127939929...
Thank you, Steve. Rest in peace.
Think Different
"The people who are crazy enough to think they can change the world; are the ones that do."
Apple: The End of an Era
I saw this video in an article today and was awestruck at the vision this guy demonstrated back in 1983. To think of what he accomplished through Apple since then is nothing short of remarkable. I'm a huge fan and would like to say thanks to Steve Jobs for creating a brand and products that, simply put, make life better and more interesting.
~ TPS
GM Chief Ewanick: We Will Be the Next Apple
I applaud this declaration. It's hugely aspirational and this short article focuses on whether they'll be able to pull it off. I don't know that answer but I do know - beyond a shadow of a doubt - it will take a few major shifts on GM's part:
They need to "Think Different." While that might be grammatically incorrect, it's the mantra that Jobs, Wozniak & Clow established early on and have lived by to this day. GM is now "Talking Different" and it appears they are "Acting Different" in many cases. But I'm not sure they're "Thinking Different." It does appear they have the makings of a team that could lead them in the right direction, however.
To execute, they need to go back to the basics. Think "4 P's." Here's what GM needs to do:
Product - Relentlessly design and engineer around a consumer's utility and delight. Current grade: B- (up from a solid D two years ago)
Price - Be simple, consistent and confident in pricing and provide multiple examples of purchase decision reinforcement. Current grade: C
Place - Provide shopping and buying environments - online and bricks & mortar - that are facilitative, efficient and delightful. This is going to be a tall order for GM. Current grade: D
Promotion - Establish the foundational positioning AND messaging of each brand and communicate them in an ultra consistent manner. Current grade: D
Apple executes brilliantly on all these. To live up to their vow here, GM will have to as well. I hope they do.
~ TPS
GM Chief Ewanick: We Will Be the Next Apple
Exec Vows to Transcend Competitive Set of Rival Automakers
Yes, you read that right. General Motors Co. Global Chief Marketing Officer Joel Ewanick, never one to think small, has declared his intention to transform the clunky Detroit automaker into a company on par with the brand that Jobs built: innovative, sleek, cutting edge and high design.
"We have an aspirational goal and this is a big target for us," Mr. Ewanick said this week at GM's second annual Global Business Conference, a half-day of speeches from the Detroit automaker's key executives, aimed at an audience of investors and analysts.
Joel Ewanick
Mr. Ewanick, almost in the same breath, praised and then dissed his competitors when speaking about his goal to become more Apple-like.
"We understand our direct competitors are Toyota, Volkswagen, Hyundai -- a very, a very strong competitor, one that I know well and is going to be very formidable -- and Ford, obviously," said Mr. Ewanick, who was the former CMO at Hyundai before accepting the GM job in the spring of 2010. "But it's time to clearly differentiate our brand and align closer to a true global brand like an Apple. It's time for an automotive company to step out and address consumers and their needs in a way that's never been done before."
Just how GM plans to turn itself into Apple remains somewhat vague at this point, and there is some skepticism among automotive experts.
"I think it's a noble goal but the short answer is no, it's not doable in the climate we exist in," said industry marketing expert Peter DeLorenzo, who runs the influential website autoextremist.com. "Automobiles just don't have the broad appeal that the latest tech products do."
As Mr. Ewanick spoke at the conference, a slide on the screen appeared with the iconic Chevrolet symbol displayed next to the Apple company logo.
"We have what we consider to be a somewhat different way of looking at this," he said. "While our competitors are going after global leadership and global domination, they're all talking about sales in one way or another and market share. [GM CEO Dan Akerson] doesn't want us to chase market share, he wants us to chase profitability. To do so we want to build the strongest consumer brand, not necessarily the strongest auto brand. ...We have to find ways to differentiate ourselves so we're not competing on the commodities (such as safety or fuel economy), but find other ways to differentiate ourselves in the marketplace."
"Brands have to be clear, powerful and distinct in the marketplace," Mr. Akerson said. "As hard as it was to go through bankruptcy, and perverse as this may sound, we had eight brands in the marketplace and we went to four. We cleared a lot of confusion and gave broader swim lanes to our (current) brands so we could make a distinction between brands and build equity and attributes."
Automotive marketing and social-media expert Kathi Kruse called GM's goal "interesting," and was more optimistic than Mr. DeLorenzo. Ms. Kruse said that the heart of Apple's success is great product, great delivery and great design. If GM wants to emulate that, it needs to start with the product.
"They need to design some amazing cars that are visually stimulating," said Ms. Kruse, who has more than three decades of experience in the car business and now runs her own Anaheim, Calif.-based consultancy, Kruse Control. "If GM can capture how good people feel when they purchase an Apple product, they can succeed. But I haven't seen that yet. The GM brand has always been pretty strong. It's come and gone over the years, but it's still strong. To me, it all boils down to design and what the customer is attracted to. ... It's not about horsepower anymore, it's about technology, both the workings of the vehicle and the technological advances. If they can focus on that, it would be huge."
GM said it will make a stronger commitment to turning Chevrolet and Cadillac into global brands -- Mr. Akerson called it the pursuit of "dual global brand strategies" -- and Mr. Ewanick likened the situation to the debut of the Lexus brand.
"It's analogous to what Lexus did to the world in 1989 ... pushed the luxury market in a different direction, and everybody had to follow. It was a brilliant move," Mr. Ewanick said. "This is a little bit of the same way. It will change the fabric of our culture. Chevrolet and Cadillac will set the tone for GM's portfolio -- how we address the market, how we bring technology to the market … We have a plan and we're working that plan."
Chevy is Starting to Run Deep
Clever, emotive & well-executed. And they actually have the product to back up the story. Well done, Chevy!
How can Des be gone?
Desmond (Des) Crowley died suddenly yesterday. I heard the news this morning and it literally shook me to my core.
