Open Marketing in the New Economy on Ricci Street's Port 80: Docks: Marketing

brought to you as a public service by The Titanic Deck Chair Rearrangement Corporation

review (not available without paid subscription)
Harvard Business Review, January, 2002, p. 106

HBR's Best Business Books of 2001

Of all the books published last year, these ten gave us the most food for thought. They offered valuable new insights and prompted us to rethink our assumptions about the world of business. ...

If the value of a business book equals the usefulness of its ideas multiplied by the likelihood of someone actually reading it, Gonzo Marketing is worth picking up. Though Locke, a coauthor of The Cluetrain Manifesto, can be annoying and preachy at times, much of this rant is a riotous page-turner. He's not afraid to poke fun at himself, and he repeatedly pulls the rug out from under the reader.

The book applies the notion of gonzo journalism -- where the writer participates in a scene while reporting on it -- to marketing. For example, Locke envisions rank-and-file Ford employees fanning out over the Internet, finding others who share a passionate interest in, say, organic gardening, and ultimately identifying this group's unrecognized automotive desires.

Some of his arguments aren't new; some are wacky. But delivered with humor and passion, they compel us to reflect on the future of commerce.

interview
Five Thoughts about Gonzo Marketing
by Danielle Dunne
Darwinmag.com, December 20, 2001
(after it gets archived, locate it on nav bar on left)

The press release, the annual report, the kinds of messages that companies put out to their markets, the whole point of which is to not offend anyone. They tend to be vanilla, humorless and filled with jargon. The notion of getting as many people as possible into the audience, into the bell curve, as a result these messages have no personality, no guts, no sense of perspective or point of view, and that is typical of mass marketing. It worked on television, it works very well there, which is why companies are addicted to using those same techniques in a medium where they are counterproductive at best.

The market, he argues, is changing into something else, rich and strange, and business can either change along with it, or crash and burn. Business must see that the emerging market, thanks to the catalyst of the Net, is developing deeper heart, richer consciousness.

Reviews of The ClueTrain Manifesto -- the author isn't shy about sharing them with you. Not one to just bash Industrial Age thinking, he also practices Digital Age thinking at Personalization.com. At Slashdot, Jason Bennett reviewed The ClueTrain Manifesto. This excerpt from the review summarizes Internet Apocalypso, chapter one of the book, which you should read.

Basically, commerce as we know it is a lie. For most of human history, trade has been about interacting with other people. Going to the market, seeing your friends, checking out the various stalls, conducting business, and generally doing the important things of life. Craftsmen proudly displayed their wares to all who would see, touch, and smell them. People discussed which merchants were fair, who had the best quality, and so on. The market was the center of human interaction, where politics, society and business merged (see the Greeks for an excellent example).

The Industrial Revolution changed all that, however. With the advent of mass production and economies of scale, production and consumption became all important. Craftsmanship was discarded in favor of turning out as much interchangeable product as possible, using interchangeable workers in interchangeable factories. The marketplace ceased to be a conversation, and became a one-way street, aimed directly at the consumer.

The rise of mass media completed the transformation from conversation to lecture. No longer did customers roam the marketplace, but instead consumers were lulled, bribed and manipulated into buying the latest and greatest, because TV told them so. The idea of the interchangeable consumer came to be the industrial ideal. Nothing was left to chance: You could get anyone to buy anything made by anyone, and all that mattered was the money. This ideal never totally came to pass, of course, but it was the driving force behind many decades of business.

According to Rogers' diffusion theory, the change agent:

develops in others a need for the change

establishes information-exchange relationships

diagnoses problems

creates intent to change

translates intent into action

stabilizes adoption and prevents discontinuance

shifts others from reliance on the change agent to self-reliance

Chris Locke challenges old ways of thinking. He is clearly a positive change agent for some, at least through Rogers' first three, especially diagnosing problems. For others, Chris is too radical to even read let alone take seriously. How do you respond to him? Has he correctly diagnosed the problems with Industrial Age marketing? What about his solutions?

Can you make a business case for them? How would they benefit a new economy business model? Neither Chris nor I advocate buying into the marketing-as-war metaphor. Can you make money using Chris's kind of marketing?

Read some answers to these questions at the Bistro's MBA 604 Roundtable's Getting a Clue topic.

Traditional marketing is adversarial: the marketer against the customer. Marketers pay big bucks to hammer you with "impressions." The more times it hits you, the deeper the impression becomes. Marketers do it on TV, they do it on billboards, they do it with junk mail. The trouble is, they can get away with this only if their customers are isolated, unconnected, and have no voice. This is not the case online.

Possibly, Ken didn't give a damn. More likely, he is not empowered to give a damn. He is probably trained to drag and drop prewritten, preapproved responses. When people are trained to communicate in that fashion, it makes it hard for them to care about the people with whom they interact. Ken would have done much better if he had dropped the automation and communicated one on one. And, the Sony brand wouldn't have taken a severe beating in the mind of this one disgruntled customer.

UB explores future of Internet
by Fred O. Williams
Buffalo News, April 27, 2000

Report from the recent UB conference titled "Next Generation Enterprises: Virtual Organizations and Mobile Technologies."

Even though the Internet has swept up millions of users, it remains a special activity - you log on, sit for a while and do several chores before shutting down.

That's about to change, experts said, as high-speed, always-on connections transform the way people shop, invest, work and relax.

"When you get people with always-connected systems, it becomes very reasonable to just walk up to a machine and get the answer to something, like what movies are playing," said Kevin Kahn, a researcher at Intel Corp.'s Architecture Labs.

Intel sees wireless computer networks becoming a household staple. While a PC keeps a high-speed connection to the Internet, simple devices costing under $100 around the house will connect to it - in the kitchen, bedroom or jammed into the couch cushion with the TV remote.

"To be effective, these things have to be very accessible, very easy to use," Kahn said.

Businesses are building the electronic infrastructure for the "pervasive" Internet, but consumers are the ones who will benefit most, Aldrich said.

"Never before have customers set the price (of goods,) but that's what's happening," he said. "Standard price lists have no value whatsoever."

Companies will bid for their supplies and consumers will bid for finished goods, turning sales relationships into a giant auction, he said. In this environment, sellers will have to find new ways to add value or be subject to cutthroat price competition. An example is Amazon.com's effort to profile its customers and tip them to new books or music they might be interested in.

"You can't manage customers anymore - you can be loyal to them and hope they'll be loyal to you," he said.

Amazon has been cutting deals with the likes of Nextel, Nokia, Motorola, and Sprint PCS to ensure that users of any device, at any time, in any location, can buy stuff from the companies' site.

people at a concert could purchase the band's CD on their phones while they were enjoying the show

people watching a movie could buy other movies from that same director while at the theatre

guerilla shopping

shoppers bring their phones or handhelds into a brick-and-mortar store and comparison shop between online and physical stores. It may be a bit too early to show some usually helpful store clerk at your local book shop a quote from Amazon and expect him to come down on his price. But the day could come, and sooner than you may think.

How soon? Try right now with PocketMail, a portable e-mail service: "Anytime. Anywhere. Any phone."

OK, you can order it, but when will you get it? Try Kozmo.com, which will deliver within an hour in many large cities. Coming soon to one near you.

Kozmo.com is the first company to deliver all of your entertainment and convenience needs directly from the Internet to your door, desk or dorm in less than an hour! Whether you're in the mood for movie rentals, DVDs, video games, music, books, magazines or food, you can order with Kozmo.com and have it in your hands within an hour. And delivery is FREE!

Kozmo has Kenneth Trevathan (formerly with FedEx) as COO and Scott Evans (formerly with UPS) to handle logistics and operations.

Kozmo.com gives couch potatoes what they want, all within an hour. Here's how the company does it.

I'm not sure whether Kozmo will survive [note Dec 2001 -- it didn't], but I think the business model has a future. Here's another vision of a future open marketing environment.

Call it the "free-network movement": Grass-roots hardware hackers are creating a wireless wonderland with megabits of connectivity for all.

A not for-profit project to develop a community wireless network in Seattle and end recurrent telco fees. We are using widely-available, license-free technology to create a free, locally-owned wireless backbone. This is a WideAreaNetwork (not just a "wireless LAN" in your home or business) and a community-owned, distributed system (not yet another service provider to whom you owe a monthly bill).

Getting it

How do you know whether someone "gets it" when it comes to the Internet? Chris Locke takes a stab at a definition in On Getting It on his Entropy Gradient Reversals site.

This person understands something fundamental about how online differs from previous media and knows a good deal about the dynamics constituting that difference. Moreover, he appreciates and empathizes with the frustrations of a savvier but largely disenfranchised grass-roots audience as it helplessly watches traditional corporations attempting to force the Internet and World Wide Web into the mold of mass-communication predecessors such as high-circulation magazines, direct-mail advertising and television infomercials.

As marketers, we pore over research, data, and statistics: Web logs, demographics, trade publications, and the influx of reports from the Gartners, Jupiters, and Forresters of the world. Overwhelmed by a glut of data that's scarcely digested before it's replaced by newer information, marketers often forget to make time for an equally critical aspect of research: the reality check.

My latest reality check occurred last week on the 42nd Street crosstown bus. On board was a group of teenage African-American youths in the baggy pants and logowear of what marketers term the "urban" demographic. Cocking an ear, I eavesdropped on a heated and very sophisticated debate of the virtues of Windows XP versus those of 2000. I'd heard the 'hood argot a million times before but never on this subject. "Yo, so I be payin' $300 for XP, and I start getting kernel errors and shit. Then I got to be downloadin' stuff from Microsoft." One advocated Apple's OSX for its improved memory use. A gray-haired man in a maintenance worker's uniform chimed in from across the aisle with tech support suggestions.

At that moment, I realized the Web's point of no return was no longer visible in the rearview mirror. It really has reached its democratic promise. Only two years ago, there was still a sense that the Web was "owned" by geeks, hackers, VCs, consultants, writers of business plans, adherents of the new-economy fallacy, and others who belonged to this elite fraternity by virtue of the fact that they "got it." There's nothing more to "get." It's just... "it." And that's progress.

Open Buying

Veo Systems is the leading supplier of products and services to enable open trading partner networks. Using Veo's solutions, companies can significantly lower the economics of business-to-business integration by exchanging information using self-describing XML business documents that both people and computers can readily understand. Veo's world class technology team has core expertise in Internet commerce, XML and distributed systems.

Open Marketing Techniques

What do new open marketing techniques look like? Let's look at one that has captured the imagination of business people everywhere:

First-Mover Advantage

The online book industry is a case study in cornering a market online via first-mover advantage. How can this be? The barriers to entry are low. The books-in-print database was already in wide use. Books are selling briskly online. There are plenty of bricks-and-mortar players. So how can we explain the Amazon-Barnes & Noble duopoly online?

More than 57 million books were sold on the Internet in 1999, triple the number sold online in 1998. Find out what influences online book buyers.

Nearly everything about e-business is poorly understood, unreliable, and likely to change. The technology, business models, industry standards, and knowledge base are all in their infancy. ...

The two or three companies in each industry that can achieve the fastest, broad-based transition to e-business will gain a profound and sustainable business advantage over their competition. This is likely to result in significant restructuring and consolidation in many industry segments.

We could call this a Net clich� � except that clich�s are generally true. It's more like an infatuation, which grows less impressive the more closely it's matched with the facts. It's long been clear that having a good idea first doesn't mean much.

No one knows what a truly networked economy will ultimately look like--other than it will be built amid the ruins of whatever from the first-or second, or third-wave of pioneers survives.

The new economy is no more about technology than the California gold rush was about shovels. ... Ultimately, and perhaps ironically, the technology-accelerated new economy is even more deeply founded in human values than the industrial economy which went before. ... We're all new economy companies now. The question is who understands what's happening and can exploit it.

on Ricci Street's Port 80

The forthcoming digital age demands new thinking and a new philosophy, requires a new set of business principles, governing everything from research and development to customer interaction, and is a time when technology will become transparent and people will become paramount.

If businesses want long-term success in the digital age, they need to care about people, and about the issues that are important to people. The Internet is a revolution in communications, and not in technology.


systems and processes on the Web


Customhouse concepts and buzzwords	Charthouse trends and currents	Boardwalk people and communities
Lighthouse information and research	Shoreline issues and policies	Docks systems and processes


search \| sitemap \| help
Ricci Green \| Digital Wares \| Gizmos, Inc. CyberSea Inn \| Port 80

modified: November 27, 2001 by Douglas Anderson http://RicciStreet.net/port80/docks/marketing/open.htm

Open Marketing in the New Economy

Getting a Clue

What's wrong

How to fix it

Getting it

Open Buying

Open Marketing Techniques

First-Mover Advantage

on Ricci Street's Port 80