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Sunday, April 12, 2015

Things I Have Learned and Observed

A few weeks ago, a young adult approached me after a lecture and asked me a provocative question. He said, “Could you tell me the most important things that you have learned over the years?” I tried to put him off by saying something to the effect that  the older I get, the more I realize how little I know. He was persistent and I told him that I would get back to him. So, over recent days, I have mulled over the question very carefully. I will avoid the cliches such as “honesty is the best policy,” “to thine own self be true,” and “work hard, it pays off.” The cliches are all true but here is a list that you may not have thought about:

1) Markets always go to extremes--as l look back it does not matter if one is talking about the real estate, stock, commodity, oil, or broadcast marketplaces, they always seem to go from one extreme to another. I vividly remember 1974-1975 recession when we suffered through inflation, interest rates and possible impeachment. TV prices plummeted but in 1975 roared back with 50+% gains in some spot TV markets. Jump to 1999; radio broadcasters were stamping availabilities saying that their rates were valid for only five days and strange new tech companies were appearing on billboards in top 10 markets. I remember remarking in a client meeting that, “the media market was a balloon in search of a pin” (not original with me, of course) and was met with a roomful of people all shaking their head no. Several weeks later in early 2000 I had relocated to Atlanta and The Super Bowl advertising that year had many new entries among national advertisers that had recently completed Initial Public Offerings (IPO’s). Some of the commercials were so obtuse that you had no idea what the company did. That was the last straw for me. Soon after, the dotcom bubble burst. It was years before you could bring the internet up with smaller clients as many had lost personal funds in the debacle. So, the moral is regardless of market, to get skeptical when people say it can only go higher or, when it has fallen sharply in value, some will say that it can never bounce back. Asset values will fluctuate--always.
2) Demographics drive the bus in most cases--To me, this is the most powerful trend in existence. It is, to me, a tidal wave that cannot be held back. Many people tell me that Europe will bounce back from their current malaise. I agree that rallies can occur but many countries have severely aging populations who will put a damper on growth and strain finances with enormous increases in entitlement expenses. Declining populations have consequences! China faces the same problem with their one child policy in many provinces and Japan is also getting very old. Governments can try to stimulate business, tax less, tax more, even encourage having more children. Yet, the die is cast for many countries. As nations get older there will be fewer entrepreneurs and fewer opportunities for vibrant growth.  So watch Asia ex Japan and selected countries in Latin America and perhaps parts of Eastern Europe. That is where the action is going to be. It seems inevitable.
3) Strategists--everybody and his brother seem to be positioning themselves as strategists. In the last 40 years, I have only met a handful of people who deserved that title and they were worth their weight in gold. Many dubbed as strategists do not know the difference among a strategy, objective or a tactic yet they are called marketing or advertising strategists. Truly, titles do not make the man or woman!
4) Geniuses--people often ask me what it must have been like to be surrounded by geniuses having worked in advertising and marketing for so many years. The truth is that I worked with smart people, clever people, many quick with a line or an ad-lib but I never worked with a genius. There was never anyone that I was in awe of despite my long years at the game. The atmosphere was invigorating and fun many times but genius? I just did not see it. Sad but true.
5) Read and read some more--I tell this to all young people who will listen. There is truly great material out there and, if you are willing to put the time in, you can learn and understand a great deal. It still stuns me how little people in business read about their industry even though they are committed to spending decades in it. If you have no interest, get out and do something you enjoy. Charlie Munger, Vice Chairman of Berkshire Hathaway, was once asked what people might find surprising about his business partner, Warren Buffett. Munger said, “You would be amazed at how much Warren reads.”  I also tell young people that if you keep on top of your industry, you will likely have great success as most people will not read much. You do not have to be overtly competitive in most businesses. Being better informed gives you a huge edge. To people who tell me that they have no time to read, I always suggest that they unplug the TV.
6) Superficiality--it is rare for marketers or ad agency people to do a really deep dive on a topic. And, the few who do are often stifled because their management may say, “Just give me the bottom-line.”  If you boss is older, put your ideas in a report or lengthy e-mail. They will likely read it. I learned the hard way to give 30 second answers to a tough question and then followed up with a detailed response in writing. Some issues and problems are just plain complicated. The one minute manager approach is not always the best.

I have a fistful of other issues on this topic that I may include in a future post.

If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com

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