It wasn’t really that long ago that agency media planning meetings started with, “OK. So what are we going to do on TV?” TV was the go-to medium. Not only that, it was the aspirational medium. Brands would yearn for the day that they had the budget to finally do TV. Until then, they were relegated to radio or magazine or newspaper advertising. While those media certainly worked, they just weren’t sexy. And you didn’t get seats court-side at a Laker’s game for buying local newspaper. (Timberwolves?)

When surveying the current media landscape one is left wondering if the Internet is the new TV without the court-side seats. (“Internet” and “court-side seats” reminds me of the joke, “Is that the banjo player’s Porsche?” See? Doesn’t work.) Of all media it has become the single channel in which all brands must exist. Can you imagine a media plan without an Internet component? Almost seems ridiculous, right? Yet, while we might all agree that the Internet has become the great equalizer — meaning that the tools exist where there are few if any barriers to entry, unlike television — it is still the least understood. It is also by a long shot the most complicated of all media.

Let’s run it down:

1. Internet strategies require integrated internal teams of business, creative and technical minds. These people don’t usually even share the same office floors. They may even have their own Christmas parties. (I bet they don’t sleep together either. Did you see last week’s MM episode!? Did you like my creative use of bold lettering? Made ya look, didn’t I?)
2. Internet strategies require a deep understanding of consumer behavior and technology preferences. This means creative begins with data.
3. The Internet is inherently social where brands are interpreted, shared, dissected, and redefined by consumers. And this is a good thing.
4. The shiniest of campaigns (i.e. the most sexy) are rarely the most successful.

In the large scheme of things, there are only a handful of CMOs who have ever lead organizations that enable these challenges to flourish. There are still a pile of CMOs who are in their positions because they killed it in television. There are a lot of Don Drapers in the role. We are just beginning to see the first generation of digital natives in the CMO role, and as such, we are just beginning to see what the Internet can really do. We in the industry tend to celebrate individual campaigns — The Subservient Chicken, Old Spice Guy, and the like — but rarely do you read about or see CMOs raising trophies for leading highly integrated teams that kill it on the Internet. And by “kill it” I mean they consistently provide their consumers with indispensable user experiences that inform, entertain, and serve useful purposes day in and day out that ultimately drive profitable sales or dependable customer service or loyalty or all the above, all at once.

If I could make a prediction, I don’t think we’ll really see the market celebrate these types of leaders until TV and radio, in particular, become just as interactive as the Internet. At that point, marketers will be out of options in finding a channel where a linear “create-buy-wait-rinse-repeat” media plan will work. When TV and radio go interactive, interruptive advertising dies and so with it the entire methodology of 20th Century advertising.

So, are you prepared? Assume TV and other traditional forms are moving ahead towards their obvious interactive futures. Will you be ready? I’d recommend you start killing it on the Internet beginning with your own internal marketing teams. First things first, you need the data people and the creative people sitting next to each other working in concert. They need to challenge each other, not feed files back and forth.

Basically, become digital-first companies. Start with digital and move outwards. If you must use television or radio or newspapers or magazines — and many of you must — then use your data to mine for audiences and messaging which then becomes the basis for targeting offline advertising buys. Use digital channels to test the b’jeebus out of creative concepts, audience segments, and calls-to-action or engagement opportunities, then go with your best foot forward into your traditional programs. It’s not an either-or world. The Internet provides you with an insurance policy against monstrous failure and a breeding ground for incredible success across all channels.

Use it. Love it. Live it. You’re out of options. Be the 21st Century Draper.

–
Andrew Eklund :: Founder & CEO
Ciceron :: Digital Marketing
www.ciceron.com
612.230.3901 :: LinkedIn: http://www.linkedin.com/in/andreweklund
Professional Twitter: @HeavyThinking
Personal Twitter: @aeklund

Please go back and read the follow-on comments to the post, and you’ll notice that no one seems to be coming to education’s defense in this argument. If this is the case, then I argue that we need to do something about it. We can’t continue to allow students to enter the marketing and advertising workforce unprepared to think strategically about how the web and the entire digital environment has changed the game. I think we can all agree to that.

But I don’t want to use this blog as a bully pulpit. Rather, let’s imagine some practical solutions. Here’s a start…

Option One: Opening Our Doors

All of us in the digital consulting and agency world should open our doors to allow university and college professors the opportunity to “audit” our real-world classrooms. They should be allowed to ask questions, come to client meetings, and participate in strategy discussions. If they would like training on how to use certain tools (like Google Analytics or Radian6), then we should allow them to look over our shoulders.

Because we are taking the time to provide ongoing training that may become an unexpected drain on limited resources, I would like to posit that we who participate should receive a tax credit. There needs to be an incentive in addition to pure altruism. Finding a treasure of altruism coming out of this recession may be harder to find than you’d expect.

Option Two: Encourage Adjunct Teaching

This is no new idea. I have taught many classes over the years as a guest lecturer and have taught a full semester at the College of Continuing Education at the U of M. It  makes  sense that those in the current market are going to have a more practical viewpoint on what students need to know to compete for employment in this tough job market. I don’t know what the attitude within the academy is towards adjunct and guest lecturing, but I hope it’s encouraged. If there isn’t a good database of volunteer adjunct faculty, then there should be. Anyone interested in building it? Know of one already? Link to it in the comments section.

Option Three: Audit Current Curricula

A panel of advertising and marketing executives (CEOs, owners, agency heads) should be assembled to take a very close look at what’s currently being taught and help fill the gaps between current curricula and reality. This panel should be consultative, not critical. It should recommend resources, from web sites to bloggers to Twitter follows, podcasts, video blogs, and RSS feeds. You’ll note I didn’t mention books. This is not to say that very current books shouldn’t be included, rather that books are overrepresented as the preferred medium in teaching digital, when taught at all. If there is a “smoking gun” between the economics of book sales for an institution and curricula, then let’s be big boys and girls and snuff it out.

Frankly, I think all three options, working in concert, may be a good beginning solution to the problems in marketing education. But there must be many better ideas out there, existing programs that we’re unaware of, or points-of-view that would suggest I’m all wet. I welcome all of those ideas, beginning with the comment section below. Perhaps there should be a forum on the topic. Minnesota Business? You interested in hosting an event? A conversation?

Thanks again for reading this blog. If you know people in education who can add their perspective, please forward them links to these pages. I’m not trying to go to battle; I’m trying to see if we can pull together and solve a problem.

I am pulling the last remaining functional hairs from my head.

Over the past two weeks we have been interviewing candidates for a summer internship. We deliberately are seeking a college junior or senior who’s getting a degree in marketing, journalism or communications. There have been amazingly bright and talented folks coming through our doors, and it has been a joy to know that an eager new class is heading our way.

One problem. Apparently the local colleges and universities aren’t teaching marketing anymore.

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Change never happens quickly and, for just a moment, let’s consider this is a good thing. Sure, there will be enlightened organizations to make crazy-change happen, and we’ll all hear about them for some time to come at industry conferences. We salute them. But for the vast majority of business across all sectors, this change will come slowly, and in most cases, the more slowly and concentrated the effort, the more sustainable and embedded change will become. (Of course, now I’m realizing as I type this what a 10 cent word “change” has become. Bear with me.)

I would like to suggest that at this moment marketing organizations need to become the fulcrum of change by growing a gigantic set of ears. We all know what has created the need for organizations to become more accessible, more open, and more communicative: 1.8 Billion Internet users worldwide interconnected to each other, sharing content in a grand cacophony of dialogue. A strong argument can be made that organizations who are struggling to make sense of this should take a timeout to do less talking and more listening than ever before. It’s amazing to me to watch organizations scramble with near reckless abandon to add their drop to the ocean when there’s an ocean of conversation to tap into and learn from. Most organizations have no idea what’s being said about them, what the tone and tenor of the dialogue is, and how, when and by whom should the conversation continue. All of this data is readily available, mind you. It’s just that marketing departments themselves have never really trained themselves to listen very well. Looking at your email marketing stats to check your open-rates isn’t listening, in my opinion. Checking your Google AdWords dashboard for click-data isn’t either.

I don’t think any company is going to get anywhere with social media until marketing departments make significant strides in learning how to listen intently, interpret online conversations, mine data for cross-functional insights, and share internally how a brand is living and breathing in this interconnected world. In fact, it’s been my experience that marketing departments who learn how to listen are most immediately valuable to internal product development teams and service managers rather that sales organizations – their traditional brethren. This new role for marketing itself is a revolutionary migration of talent and skills.

Mastering listening — a combination of data, analytics, behavioral science, and raw intuitive powers — should become a central focus of marketing organizations right now. The better these organizations listen, the better they can interpret and share insights across internal departments, thereby making the perceived chaos of the Internet real, relevant, and palpable. Until that happens, I don’t believe we’ll see any major, long-term, or meaningful inroads towards the real change — and unparalleled opportunities — a social economy provides organizations of all types. Until marketing departments become one giant set of ears, lead by leaders who have embraced listening as a core professional attribute, flash-in-the-pan “viral campaigns” and other sugar-buzz programs high on talk and low on listen will continue. I just hope you won’t succumb to this. The opportunities of the social economy are too great to fall too far behind.

Sure enough, she breezed through the first several rounds. Then, at the round for $16,000, she got the following question (paraphrased), “In 2008, Google launched a new operating system to compete with Apple’s iPhone. Is it called… A) Zebra B) Spider C) Zephyr or D) Android.” I’m thinking to myself, “Crap, that’s the easiest $16,000 she’ll ever make.” She hemmed and hawed. No clear answer (as I’m screaming at the television). “I think I’ll poll the audience,” she surmised. Blippity-beep-beep-blip…the audience locks in its vote.

Results: Spider 60%, Zebra, 19%, Android, 18%, and Zephyr 3%.

“OK. B. Spider. Final answer.”

“Yahtzee!!! Whoa. What did you say? B??! Spider? No, you stupid writer for the New York Times! It’s Android! Google’s Android Operating System, dumbass American audience of hundreds!!!”

And, then it hit me. Most people don’t know that the iPhone has a competitor, little less what its name is. And for that matter, most people probably don’t know or care about Facebook’s new changes this week or want an iPad or care that Google is indexing social content faster than you can say “Zephyr!” Most people don’t care about Flash coming to the Android, they could care less about Hootsuite, Mashable, Foursquare, or Gowalla combined. Most people — the people who pay your paychecks in marketing — don’t know about or care about these things right now.

What’s my point of this post other than to completely annihilate your techie-little soul? My point is the challenge of perspective in the rapidly evolving world of digital technology. The pace of change right now is breathtaking. 100%, chopped beef and ketchup, American-style breathtaking. But as marketers, it’s easy to forget that we’re not in this to be first to sell these new technologies – no matter how tempting it may be – as viable marketing channels. This is not to say that we shouldn’t be the first to embrace and experiment with new technology. But when I get a phone call from someone asking me if we do iPad development – one week after launch – my answer is “for whom?” How many brands out there other than those that need to be on the iPad really have a captured audience at a small fraction of the 500,000 units sold? That’s when the marketing-to-the-shiny-object rather than marketing-to-a-consumer jumps the shark. (How many Americans know what “jump the shark” is? Well, now you do.)

Technology can really put the evil in devilish. Just as the economy swings back and marketers have a few more nickels to play with, is it responsible of us to start scheming all the cool ways clients could launch this’n'that app when they still aren’t even using email or search properly? Should we be worried about iPhone vs. Android when they’ve still got real Internet Explorer vs. Firefox issues? Are you really thinking about an iPad app when their .com conversion points still stink to high Heaven? Aren’t we just as concerned about the 400,000,000 on Facebook as we are the 1,000,000 on Foursquare?

Just because the nickels have come back doesn’t mean they weren’t provided by the internal bankers. The cries for accountability in marketing in 2008-9 didn’t go away in 2010 because the iPhone App Store hit a gazzilion apps. Remember, those got into the store because Apple blessed them, not because they have a market.

I’m all about cool and shiny. They represent the future and the future is brilliant. But the NOW better add up or you’ll be back to building crappy banner ads or fielding questions about the Spider operating system in no time.

Facebook is the new AOL. Whoa whoa whoa!! Hold on a second. Shut your collective pie-holes for just a second. There was a time when AOL was actually pretty cool. (OK. Now listen carefully. Do you hear that? Yup. That sound was just 10 million geeks all saying in unison, “AOL WAS NEVER COOOOOOL!”) Back in 1992 or so, it was an ecosystem that was relatively easy to use, anyone who got on could find something entertaining, and “You’ve Got Mail!” was something you actually looked forward to hearing each time you logged in. Let’s not forget that another little upstart company called Apple actually tried getting into the more commercial game when it replaced its AppleLink with an online community called eWorld. It was pretty cool too but died a quick death, arguably because AOL was killing it in terms of subscribers. (Just for giggles, let’s also remind ourselves that Apple killed eWorld so it could focus on launching the Newton. Now THAT’S funny.)

Facebook is the new AOL, however, for the same reason AOL was AOL: it is a safe, understandable (albeit clunky), predictable, walled-garden that attempts to keep its inhabitants together comfortably. I would say it’s doing a rather good job when you consider that it’s gone from nowhere in 2007 to 500,000,000 users worldwide. This is where I continue to really make some enemies with the traditional Internet crowd: for a huge number of consumers, the Internet is just too damn difficult to use. Every site you go to has been designed by someone different, you have to learn how to navigate it, and, frankly, so much of the content is pure crap (and, yeah, I’m talkin’ to you, Corporate America). At some point, a whole bunch of people — I know, that’s scientific — throw up their hands and say, “Hell with it! I don’t have time for that. If there’s something good for me to see Out There, someone will link me to it.”

So perhaps there’s a better metaphor for Facebook. Facebook is the Internet’s Green Zone. While there’s a war raging outside, Facebook is that place where your friends are. It’s nearly impossible to get accosted on Facebook. Why? Because Facebook is a universe almost entirely comprised of people you’ve selected to follow and engage with. The Internet is crazy town. Facebook is Mayberry. (Jeez, Andrew. Quit it with the roaming metaphors.) Just like real life, most people on this planet want to live in a Mayberry, where the kids can roam free, neighbors are on their front porches engaging in the talk of the day, and the police take care of the bad guys. Look, I get it too. Lots of people don’t want any of this. It’s too safe and pretty and, er, controlled. Designers hate Facebook because there’s nothing to do with it. Developers hate it because you have to code everything the way Facebook wants it. And of course the Internet elite hate it because it’s Facebook, just like they hated AOL and, before that, CompuServe.

As a marketer and communicator, it’s my job to go where the people are, and while Facebook has a long way to go to be ubiquitous, it does represent 500,000,000 people worldwide with considerable purchasing power. From teens talking about Justin Beiber to moms (and dads) desperately asking each other “OMG! Who’s this Justin Beiber!” Facebook is a serious force in this economy and in our culture. One last anecdote. In my life I walk into a lot of different businesses, and I can tell you who looooooooves Facebook: office receptionists. I’ve begun to take more serious notice, but I bet 8 out of 10 office receptionists right now are either messing around on Facebook or have it open in the background as they’re  faking looking at that Word document.

And it gets weirder. Increasingly, I’m finding myself in a more common position when working with a client to recommend a Facebook environment rather than building a stand-alone website. And I’m talking about some pretty unsexy stuff too. Recently, we’ve been setting up client sales teams on private Facebook groups so they can exchange client information, best practices, and market conditions. Why build an external community that would include all the built-in features of Facebook when you have…Facebook?

So, haters, bring it. Hate your Facebook. But unlike AOL (and most likely the Green Zone too), Facebook isn’t going away anytime soon. It’s time to wrap your head around it, imagine how your business plays in it, and love it. Why? Because remember, most of you hated the Internet too.

Right now, Facebook is holding its developer conference called f8. For coverage, visit here.

A million little things are said every day about social media. Of those, 842,653 of them are written by media people. (You know ‘em – nice glasses, fashionable jeans, iPad.) The remaining pieces are written by people talking about the media people writing the other stuff.

You know who doesn’t seem to be writing a lot about social media? Organizational development people. They should because of all the people within the economic ecosystem who will become most affected by social media, it’s the people who understand how organizations work, communicate, engender trust, and organize resources who will need to lead companies through the onslaught of billions of consumers wanting access to all layers of a company’s culture.

Marketing won’t lead the social media revolution. There’s no way. So, here’s my prediction for what’s going to go down.

1. Marketing will continue to be the pied-pipers. They will be the first to embrace intense customer dialogue. They will — as they always have — attempt to speak on behalf of all other departments when called upon. For example, when a cacophony of consumers ask a brand to address a product flaw, it will be marketing who will attempt to address it, not the product developers or product managers. Increasingly this will frustrate consumers as the answers they need outpace the flow of information that marketing can provide. Depending upon the circumstances, the consumers will rise up using their social connections to become a deafening cry for help.

2. When dealt with this type of situation, marketing too will cry for help. They will say, “The questions they’re asking are legit. They’re detailed. They want real answers.” Marketing will reach out to the product managers who will reach out to their product development teams, who at first will push back. They will ask marketing “How many people are asking this? Who knows about this problem? Why can’t you squelch it? Isn’t that your job?” So now marketing and the product development teams don’t like each other.

3. The VP of Sales begins receiving emails from sales people in the field. This product flaw has become ingrained into each and every sales discussion. It seems as though everyone knows about it. “Where did this come from? Who started it? What isn’t marketing making it go away? WHO’S ADDRESSING THIS PRODUCT FLAW??!” The VP of Sales goes to the CEO saying, “There’s a problem. We have a serious flaw with one of our products and we can’t sell it until we address it.” The director of customer service comes barging in the room. “Sorry to interrupt but our phones are on fire. There’s some problem with the product, and my people haven’t been trained to respond!”

4. The CEO realizes quickly the problem: for all too long, the company had treated the social networks like another marketing sound amplifier. She realizes that her long-held hunches were in fact correct. Social media isn’t “media” as in broadcast, it’s media as in a decentralized, cross-departmental, easily accessible connections ecosystem that needs broad participation (although perhaps not deep because, you know, people still have jobs to do), published rules of engagement, commonly held measures and analytics, and cross-functional leadership teams who listen and find efficient and truthful ways to respond to customers. You know what the CEO needs? Great organizational development.

Remember that time capsule? You can choose to print this piece and bury it for a while but I’m pretty darned sure the above scenario will repeat itself over and over again on many scales, from very small but important to large and potentially catastrophic (read: Toyota). I would encourage you not to bury it. At the very least take the above scenarios and have a conversation about how they would affect you if they came true. Ask yourself an important question: what if our social media plan doesn’t originate in marketing at all? What if our strategy shouldn’t originate in any department whatsoever but at the very top of the organization itself with leadership understanding the broad implications of a new type of marketplace where there is no longer any gap between a brand’s claims and actual brand experience? What if we co-create (hello, 2003!) our brand every single day, interaction by interaction? A very different company culture needs to be fostered to excel in that type of market dynamic.

There’s a comment section here for reason — let’s have an honest discussion about this. I look forward to it.

Something tells me this may be the same experience R.F. Moeller jewelers is feeling this morning. I won’t go into great detail here, but suffice it to say that a very controversial ad appeared in City Pages this week where a man with a gun to his head is lamenting his decision to have purchased a diamond somewhere other than R.F. Moeller. This post is not to engage in a moral dialogue about the ad’s creative, rather to outline how even the smallest of sound in advertising — a quarter page ad in a city newspaper — can reverberate throughout, frankly, the world.

A quick DNA of yesterday’s events. The ad appears and immediately those who are offended begin to cascade upon the R.F. Moeller Facebook page to express themselves. In a bit of a sideshow, a friend of mine snaps a photo of the ad and tweets about it to his followers. I “retweet” his post, also expressing my outrage. The digital editor at AdWeek.com, who follows me on Twitter, decides to showcase the ad in his daily “AdFreak” site, a site extolling the non-virtuous of the advertising world. The ad writer apologizes to a local journalist. The local news covers it. And, as of today, the story continues.

I’m not sure how R.F. Moeller is taking all of this. As the old adage goes, “There’s no such thing as bad publicity.” Eh, yeah, don’t buy that, but that’s not what this post is about either.

Every ad, every marketing claim, every promotion now exists in an ever-connected echo chamber where it lives, breaths, is shared and interpreted over and over ad nauseum. The Moeller case study is not about a City Pages ad. No, it’s a story about never underestimating the power of the social echo chamber. A single ad can become a story can become a phenomenon. As a marketer, this excites me. As a brand, it should too. But without proper planning or expectation-setting, it can be a nightmare.

R.F. Moeller claims it did not see or approve of the ad prior to it being published. Something tells me that will never happen again.

Of course, that’s not how I went into the week. I went in all bright-eyed and bushy tailed ready to foment people into a digital marketing lather, all ready to tackle the world. I left the week wondering if I had just spent a week punching people in the face.

During four public speaking events, I addressed two resorts, one travel industry group, and a conference of non-profit marketers. Each group shared the same challenge — how do we reach and engage new audiences? My message was clear: if this is your business — to reach essentially anyone with a cell phone and Internet access — then whether you like it or not, you are in a technology business. You, as a marketer, are a technology person. You have a technology career. The separation between technology and marketing is no longer the Great Departmental Divide. I simply can’t see any way around it. You can no longer in-source, out-source or — gasp — ignore the realities of your field. Consumers across nearly all demographics have become technology literate, digitally nimble, voracious imbibers of content, and equally adroit sharers of opinion.

In Las Vegas last week, I mentioned to an owners group of a large Strip property that every day, thousands of visitors enter their doors armed with tiny story-telling machines called smart phones. En masse, they create and share more content in a single day than a brand may in an entire yearlong campaign. This content is first-hand, unfiltered, honestly communicated niche content which is exactly what we consumers wish to engage when considering brands. Sorry, but I just can’t find a way where any non-technologically enhanced or extended advertising program will ever compete with this onslaught of consumer-generated storytelling.

What this means to me is that marketing leaders are not only charged with creating compelling brand experiences but they themselves need to be the people to imagine how technology will enhance and extend — oops, said those two words again — the totality of a brand experience. Too often I see creative people develop ideas, then ask others to figure out how technology will work with those ideas. How can this possibly work anymore? And please don’t get me wrong on what I mean by “brand experience.” I don’t just mean, say, a branded iPhone app or other cool-factor program. I’m talking about every single touchpoint in a potential consumer’s consideration process, from awareness to tapping into the ginormous amount of consumer-generated content to extracting their wallets. Technology has infiltrated every single point in that process so as marketers we need to know better than anyone — A-N-Y-O-N-E — how we play in that world at the inception of marketing ideas, not at the end when the idea may become moot altogether.

Based upon my experience last week delivering this message to a wide array of audiences, I can tell you that there’s a real look of fear in people’s eyes. Seasoned marketers were not prepared to have to become technology people. In fact, a great many of them loathe the entire premise. I get it. But I just can’t see any way around it. If you are entering a career in marketing or advertising, prepare thyself to become intimate with consumer electronics, data, and applications. If you don’t naturally love them, learn to love them. If in the end, you simply cannot find yourself lovin’ the digital, then it’s hard for me to continue to recommend this rapidly changing field to you. There are plenty of great creative-only fields — but advertising and marketing isn’t one of them.

On the other hand, there’s one rich guy who’s my favorite — Warren Buffett. The Oracle of Omaha. Andy Rooney’s younger brother. (Alright, that was a stretch.) Last count, Mr. Buffett was the second richest guy in the world, right behind those guys who invented Twitter.

Warren Buffett might be the most boring investor in the world too. He buys insurance companies. He buys Dairy Queens. Get this — he buys railroads. Hey, Warren, would you like a side order of sock garters with that?

But through all of the “celebrity” bank collapses, Federal government bailouts, and perp walks, Warren Buffett has stuck to his conservative, boring investing ways, and we have so much to learn from the old man. Here are some snippets from his annual letter to his Berkshire shareholders. (He calls his annual meeting a “Woodstock for Capitalists”) The entire letter is a fascinating peek into his brain, with folksy prose (“Sing a country song in reverse, and you will quickly recover your car, house and wife”), and scathing critiques. It should be required reading for all MBA students. Hell, all sixth graders should read it.

On “chasing shiny objects” (my words):

Charlie and I avoid businesses whose futures we can’t evaluate, no matter how exciting their products may be. In the past, it required no brilliance for people to foresee the fabulous growth that awaited such industries as autos (in 1910), aircraft (in 1930) and television sets (in 1950). But the future then also included competitive dynamics that would decimate almost all of the companies entering those industries. Even the survivors tended to come away bleeding.

Just because Charlie and I can clearly see dramatic growth ahead for an industry does not mean we can judge what its profit margins and returns on capital will be as a host of competitors battle for supremacy. At Berkshire we will stick with businesses whose profit picture for decades to come seems reasonably predictable.”

On Wall Street:

“We make no attempt to woo Wall Street. Investors who buy and sell based upon media or analyst commentary are not for us. Instead we want partners who join us at Berkshire because they wish to make a long-term investment in a business they themselves understand and because it’s one that follows policies with which they concur. ”

On CEOs:

“In my view a board of directors of a huge financial institution is derelict if it does not insist that its CEO bear full responsibility for risk control. If he’s incapable of handling that job, he should look for other employment. And if he fails at it – with the government thereupon required to step in with funds or guarantees – the financial consequences for him and his board should be severe.

It has not been shareholders who have botched the operations of some of our country’s largest financial institutions. Yet they have borne the burden, with 90% or more of the value of their holdings wiped out in most cases of failure. Collectively, they have lost more than $500 billion in just the four largest financial fiascos of the last two years. To say these owners have been “bailed-out” is to make a mockery of the term.

The CEOs and directors of the failed companies, however, have largely gone unscathed. Their fortunes may have been diminished by the disasters they oversaw, but they still live in grand style. It is the behavior of these CEOs and directors that needs to be changed: If their institutions and the country are harmed by their recklessness, they should pay a heavy price – one not reimbursable by the companies they’ve damaged nor by insurance. CEOs and, in many cases, directors have long benefitted from oversized financial carrots; some meaningful sticks now need to be part of their employment picture as well.”

On valuating a potential acquisition:

“When stock is the currency being contemplated in an acquisition and when directors are hearing from an advisor, it appears to me that there is only one way to get a rational and balanced discussion. Directors should hire a second advisor to make the case against the proposed acquisition, with its fee contingent on the deal not going through. Absent this drastic remedy, our recommendation in respect to the use of advisors remains: “Don’t ask the barber whether you need a haircut.”

His closing statement:

At 86 and 79, Charlie and I remain lucky beyond our dreams. We were born in America; had terrific parents who saw that we got good educations; have enjoyed wonderful families and great health; and came equipped with a “business” gene that allows us to prosper in a manner hugely disproportionate to that experienced by many people who contribute as much or more to our society’s well-being. Moreover, we have long had jobs that we love, in which we are helped in countless ways by talented and cheerful associates. Indeed, over the years, our work has become ever more fascinating; no wonder we tap-dance to work. If pushed, we would gladly pay substantial sums to have our jobs (but don’t tell the Comp Committee).

Nothing, however, is more fun for us than getting together with our shareholder-partners at Berkshire’s annual meeting. So join us on May 1st at the Qwest for our annual Woodstock for Capitalists. We’ll see you there.

February 26, 2010

Warren E. Buffett
Chairman of the Board

P.S. Come by rail.

Yesterday afternoon at the Best Buy corporate headquarters, the local social media faithful arrived to hear from one of its titans, Chris Brogan. It was a lovefest. The robes were pressed, the members of the choir took their places, and Brogan, the choirmaster, took the baton for a somewhat rambling, often irreverant, and thoroughly Kool-Aid dripping two hours. What follows here are my musings, which I must stress has absolutely nothing to do with the gracious hosts of yesterday’s event–the LaBreche agency (dear friends) and this magazine.

Let’s be very straight about something: social media is having a hard time growing up. Its promises have, for many reasons, not penetrated company board rooms or the executive suites. While this is shameful because of the many opportunities social technologies and practices can have on an enterprise, the professional social media crowd has yet to make solid business arguments as an industry. There were few if any major company executives in the room yesterday. This is the non-existent elephant in the room. And is par for the course for these type of events.

I would like to posit several arguments here that may help rectify this problem.

Social Media Isn’t Marketing – Social technologies are pervasive throughout organizations. Consumers too experience enterprises from myriad points – from call centers to sales organizations to retail channels to product developers. Really, any department of an organization is now a “customer-facing” entity. If you accept this premise, then why is social media typically a charge from marketing? I would suggest that the opportunities social technologies present are organizational challenges, not marketing ones, and (as I tweeted from the event) social media won’t be anything special until it ceases to be marketing function and starts to be led as a enterprise function.

Social Intelligence Is More Valuable Than Social Talking – Business executives have a voracious appetite for intelligence into their marketplaces, their consumers, and the performance of their own companies. Billions of dollars are spent on all types of intelligence gathering that can inform incremental changes to a business that can have tremendous financial and quality improvement outcomes. This, to me, is where social media evangelism should begin. Too often we hear that we need to “listen” more to what’s being said about us as brands. So true. However, listening is passive. (“Passive” doesn’t sell well.) Intelligence is the outcome of listening, and while that statement may seem simplistic, I would suggest that until social media experts can deliver all of this listening as proper intelligence, the battle for social media will continue to be an uphill one. It is fact that consumers have lunged into social technologies with incredible speed and as such they are creating an equally incredible volume of first-hand content that must be listened to, filtered, analyzed, shared, and acted upon. When executives realize that social content is perhaps the very best source of real-time business intelligence, then social media grows up.

Social Behaviors ARE Measurable - I heard it again yesterday: social media isn’t as accountable as other forms of communication. Really? There are absolutely wonderful tools out there to make all of this noise measurable. And, yes, the good ones cost money. Radian6 is a wonderful tool for quantifying and, increasingly, scoring the sentiment of what’s being said about a brand. RapLeaf is a firm I’ve used recently to give my clients individual social profiles of their customers (What networks are they on? How do they use them? Are they well-connected?). From these sources, we can learn how best to engage with various customer segments, look at our customers differently from one another, and distinguish intelligent nuances in how they interact with brands. From a product development standpoint, we can use these tools to measure how we need to make incremental improvements to better satisfy customers. All of this is social media.

Did I mention Twitter? Did I mention Facebook? I did not (until now) because that’s not what all of this is about. The changes that are taking place right now in the market are about using these tools to make us better companies and organizations and by using them intelligently and strategically.

What do you want social media to do? What do you want to learn? How can these wonderful tools make us better enterprises? Those are the strategic questions that should keep executives awake at night and us in the busines focused.

Thanks again to Beth LaBreche and Minnesota Business for putting on the event. I am certain it has triggered the right kinds of conversation to push us all ahead constructively.

Uff da, Mr. Brogan.

Read entire post at MinnesotaBusiness.com – then come on back, ya hear?

Today’s marketing executives got to where they are by executing marketing when it was in its “classical music” stage. Classical music is a genre that does not take to making mistakes lightly. In fact, there is no room for error in classical music. The musical script — or score — is hardwired. The only variance in classical music from one ensemble to another is the quality of the individual players’ musicianship and the minor nuances the conductor makes in his or her interpretation of the score. These variances can be staggeringly apparent, however. Listening to the Minnesota Orchestra play Beethoven’s 5th Symphony is a much different experience than listening to my son’s beginner youth symphony play the same piece.

Oh yeah, we were talking about marketing…

Well, you see, modern marketing is no longer a rigidly scored practice like classical music. Marketing has entered its “jazz” phase. Jazz differs almost entirely from classical music. Jazz celebrates improvisation. Jazz takes to a score, or “chart” as it’s known in jazz music,  more like a general roadmap that’s meant to be interpreted and reinvented each time a piece is played. Where classical music tends to strive towards an ultimate “perfection,” jazz music bobs and weaves its way through time, changing instrumentation, interpretations, and auditory end-games.

Modern marketing is jazz. The spin cycle of change in media, consumer behaviors, and technology’s influence is so fast that a rigid score or marketing plan simply cannot keep up. A modern marketing plan reads more like a jazz chart, providing the individual marketing team members with a series of goals and desired outcomes, leaving tremendous flexibility and mid-course measures keep on course. It’s no wonder that many marketing executives are challenged in today’s market. The genre of marketing music changed. Transitioning from the world of classical to the world of jazz marketing is a monumental mental shift that also requires an entirely new skillset.

There’s good news in all of this: most marketing professionals are eager to learn these new charts. Most younger marketing professionals grew up in a jazz world and are ready and rearing to get to work. They simply need a band leader who will give them the objectives and goals, then let them take to the stage and play great music.

Like jazz, digital marketing thrives on innovation and improvisation rooted in a groove. Our grooves are your results. Money, baby. Leads. Sales. Customers. Loyal, wonderful, happy customers. Come jam with us. It’s time for jazz».

Originally published in Minnesota Business Magazine, Sept 2009.

Over the past several weeks I have been caught in a strange vortex of slogging through the budget process for my clients’ 2010 marketing plans and keeping an eye on the saga of Tiger Woods. This has proven to be quite a mess. On the one hand, I’m attempting to help a few clients thrive in a world where they no longer have a rather tight grip on the message through their advertising and media relations efforts. On the other hand, well, there’s Tiger.

Full Article

This reminds me that we’re in the middle of two seasons: deer hunting and marketing budgeting.

Read the full article on Minnesota Business.

It’s been a long time coming and lots of hard work over the last few months, but I had an incredibly enjoyable time creating a new look and feel, and a whole new shopping experience for SmartMusic.com And a shout out to Roy Neal of Straight Line Theory for consulting with me and facilitating our usability testing sessions. Nicely done all around!