Death of the Deep Dive

 

Over the years I heard many people requesting that I or my team take a really “deep dive” into a particular topic. Some really meant it and others seemed to be paying lip service to the concept.

 

I particularly loved it when someone gave me in depth sales data following a recent media campaign. Along with a team member or two, we would take a legitimate “deep dive” into the sales numbers. Very early in the game, I learned that very few products or services delivered per capita sales “flat” across the country. One big exception appeared to be Colgate toothpaste but most had pockets of strength and, at the same time, other Nielsen Designated Markets (DMA) that were quite weak relative to the national average of sales.

 

Variables appeared to be distribution, age or ethnicity of the market, wealth, and, of course, media delivery for our supported brand in the DMA. The more we learned, the more that we tried to customize an effort in each market which was often referred to as market-by-market planning.

 

It was a great deal of work at times. Yet, when we stuck with it, often we could “level the playing field” somewhat relative to a better financed or more well-known competitor. Once, senior management told me to back off. To paraphrase their marching orders, it went: “I know that you are doing the right thing but the hours you spend are not appreciated by the client. They do not even read many of your reports although they are happy that sales are trending upward in a weak market environment.” I continued to do it on my own during nights and weekends.

 

Today, with media buying services dominating conventional media execution, my dogged and time-consuming approach is gone with the wind. Also, it is difficult to isolate the impact of some mix of digital and conventional media although Big Data is telling us amazing things about our customer base for most brands and many services.

 

Some argue that Consumer Behavior will soon get weaker as a discipline as customer profiles provided by the amazing array of facts spun out by Big Data will largely eliminate the WHY people are buying you factor.

 

My friends, this is not a rant by an old man wishing for the good old days (that never were!). The concern that I have is that the mountain of information being provided needs a few astute analysts who will sift through the tonnage and make informed decisions.

 

If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com or leave a message on the blog.

 

 

The Importance of History

 

When I was a very young child, I became enamored with history—particularly American history. I think it all began on my fourth birthday, when my father gave me a child’s gift of statuettes of all the U.S. presidents. Soon, I could rattle off the names in order of all U.S. chief executives (if you think that I am boring now, can you imagine me then?).

 

A few years later, when I discovered sports, I would place the presidents in a T-formation with current president, Dwight Eisenhower, as quarterback. My father thought it was hilarious and told me that Ike Eisenhower was the second-string quarterback when he was a cadet at the United States Military Academy.

 

Trips to the Old North Church, Bunker Hill, Paul Revere’s house and the Statue of Liberty continued to whet my appetite for American History. All through my school years it was my best subject and my early major in college until I was seduced by Economics.

 

Even then, my two favorite classes ever were Economic History and History of Economic Thought. The latter remains an important part of my daily regimen 50 years later.

 

It has always surprised me that people have no interest in history. In business, people tell me who cares about what happened 20 years ago or even five? I want to know what is happening now, they say. My response is generally something along the time-honored lines of how can you understand the present without understanding how we have gotten there?

 

So here are some of my rules as to why history is important:

 

1)  It helps you understand change. Most things in the media world evolve; they are not revolutionary. So, if you look at the past decade or two, you will see how things have moved and have a handle as to where they might go. I once presented to my team a lengthy update on cable TV with a two-minute summary of how it started back in 1948. Shifting uncomfortably in her seat, a very strong negotiator blurted out “who cares about that. Even YOU were not born then.” Laughing, I stressed how the 120 second background sketch that I built would not hurt her and I proceeded. Yet, as talented as she was, she had no ability but to see right in front of her. The past and the future meant zero.

2)  Looking at history is inspiring. Just this morning, I discovered a new entry about how my first American ancestor came to Plymouth, Massachusetts approximately 10 years after the Mayflower dropped anchor. He was quite a character and I thought about what he had to overcome to get there and make his way in the new world. Study how entrepreneurs persisted and overcame one failure after another. You will find that there are very few overnight sensations in the world of commerce.

3)  Above all, when you study the history of your field you begin to see patterns. They are not all able to predict the future but as Mark Twain put it, “history does not repeat itself, but it rhymes.”** As you get older, you often tell yourself “I have seen this movie before.” For me, it has been true of media, real estate, commodity, equity, and new product development arenas. Development follows patterns as do trends. This point is made wonderfully by hedge fund manager Ray Dalio is his new book, “Principles for Dealing with the New World Order, Why Nations Succeed and Fail” (Avid Reader Press, 2021). The book is a tour de force that takes you through several hundred years of economic history and global reserve currencies and makes some scary possible scenarios for the future. It is easy to read and really makes you think.

 

So, whatever you do, may I suggest that you embrace the history of your discipline. You may be surprised or you may be mortified but I doubt if you will be bored. And, it will likely help you get a handle on the future.

 

 

**I once used the Mark Twain quote to a group of university students. Most nodded but a student’s hand shot up and he said,  ”Who is Mark Twain?” That night a rare event occurred. I had a difficult time falling asleep as I worried about the future of our country.

 

 

If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com or leave a message on the blog.

Upton Sinclair Lives!

 

Upton Sinclair was a well-known writer in the first half of the 20th century. He was a bit on the angry side but did famous exposes such as THE JUNGLE which frightened America as he wrote of unsanitary conditions in the meat processing business.

 

He lived to be 90 passing on in 1968. While largely forgotten today, he is often quoted but not credited with a very profound statement. Sinclair ran for governor of California with a left leaning platform at the bottom of the Great Depression. He got clobbered at the ballot box and wrote a book about his experience as a candidate the following year.

 

The insightful comment that I referred to above came from that book and is: “It is difficult to get a man to understand something, when his salary depends on not understanding it.”

 

Let it sink in a little bit. Over the last 50 years, I have seen it come to life dozens of times.

 

Here are some examples:

 

1)  Way back in the late 1970’s, I was invited to speak at a TV station on the future of cable TV advertising. I burned the midnight oils putting a deck of acetates together (these were the pre-power-point days) and gave what I believed to be an even-handed discussion of where TV advertising both local and national was heading. The first five minutes went well, then the audience became restless and finally they were openly hostile when the Question and Answer period began. The General Manager walked out and a few of the sales team told me that I wanted them to lose their jobs. I stuck to my narrative but, being young, I was a bit shaken.

2)  Fast forward to the late 90’s and I had similar experiences with audiences across conventional media types when the Internet took center stage. “This is just a passing fad; it will never get traction” were among the responses I received. Once, in the year 2000, I had to speak to a newspaper industry group and was candid about what I thought was an inevitable decline in readership and advertising revenue. An old man (far younger than I am now ) yelled out, “My great-father started our paper in 1886 and my grand-daughter will be running it forty years from now.” I had the same type of experiences with radio station salespeople and magazine sales managers and publishers.

3)  Social Media the last 15 years—Sinclair’s quote held true as people dismissed it as a flash in the pan.

4)  Streaming video—Netflix, Amazon Prime, Disney Plus, Hulu Plus and others were getting traction but some dinosaurs told me that once the conventional networks put out some better programs people would flock back to them. I countered gently, I thought, that once people get used to not seeing commercials it will be difficult for them to return full bore to advertiser supported television. Also, it will be difficult to introduce new products due to heavy advertiser avoidance. Existing brands could do line extensions and have great credibility and a huge advantage over new brands that did not have very deep pockets. Advertising, as we know it, will slowly die and something else would take its place. Few were buying although most would admit that streaming services were their go-to viewing option.

 

Is this phenomenon limited simply to media? Of course not!

 

A few examples:

 

1)  I just finished reading TRILLIONS by Robin Wigglesworth (Penguin Random House, 2021).  The author is a long-time correspondent for The Financial Times. It took a seemingly dry topic, the growth of Index Funds, and talked of the huge resistance the financial establishment put up against them. How could a passive investing approach beat the performance of a fund that is professionally managed? Well, Jack Bogle of Vanguard who did not invent but certainly popularized the Index Fund concept showed again and again that, over time, excessive costs from standard mutual funds or financial advisors would eat up a fair portion of one’s profits. An Index Fund charges very little so the overwhelming majority of your gains are yours to keep. Bogle told people not to try and pick the next Apple or Amazon. Do not look for the needle in the haystack, buy the whole haystack and, over the long term, you will almost always outperform a money manager. Yes, there are people such as Warren Buffett, Stan Drukenmiller, and Bill Miller who defied the odds but they are in a tiny minority. Today, most of the big investment houses have embraced Index Funds despite their initial hostile welcome.

2)  Autonomous vehicles—mention self-drive trucks or Ubers to people and some get furious. It can never happen is their response. Well, I am betting that it will as businesses have one cardinal rule—cut costs! Over the next couple of decades when the artificial intelligence gets better and better it will be safer to have autonomous vehicles on the road. Insurance costs will drop and employers will not have to pay their truck health care costs, unemployment insurance, social security taxes, etc. Now, I realize that consumers always lag technology so it will be a while for driver free trucks to dominate things. At the same time, a 25 year old today cannot expect a 35 year career as a truck driver. Also, robotics will be even bigger players in manufacturing and even service industries.

 

A lot has changed since the mid-1930’s when Sinclair penned his famous line. One thing has not changed—human nature! So people, even intelligent and rational ones, do not want to accept anything that can threaten their livelihoods.

 

If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com or leave a comment on the blog.