Last week, I had some furious e-mail exchanges with a Media Realism reader. I have never met the gentlemen in person but there is a lot of mutual respect between us and we both really enjoy the lively back and forth that our correspondence generates.
With his permission I am going to cover portions of our e-mail trail from a week ago.
He basically led off with the premise that the United States was finished. Our debt and overhanging entitlement avalanche would eventually destroy the country. China, in his view, would rule the world in 20 years. We might hang on as a military power for a while but our days as a serious economic player are rapidly coming to an end.
I agreed that we certainly face serious challenges and that politicians need to take corrective action soon to avoid a disaster. But, I warned him that as impressive as China’s growth has been in recent years, they appear to be headed for a train wreck that will be harder to avoid and correct than our entitlement and debt problem. It all comes down, like many things in marketing and business, to simple demographics. To explain, let us go back about 200 years.
Thomas Malthus (1766-1834) was a very gloomy economist at a time when the rest of the educated world was getting excited about the ideas of Jean Baptiste Say, Adam Smith, and David Ricardo. One of his most famous arguments was that the western world would have severe trouble feeding itself. Basically, he said that population, when left unchecked, increases in a geometric ratio. At the same time, the ability to produce food increases only at an arithmetic ratio. So, eventually, many nations have to face starvation. Famine and epidemics would help (sic) ease the problem as would the occasional war and plague. Without those sad events, Malthus felt that the only acceptable alternative was very late marriage and abstinence by the population. As a clergyman he was opposed to all forms of birth control (like many economists, Malthus was a fun guy).
Chinese leader Mao Zedong was strongly influenced by Malthus and watched with alarm as the Chinese population grew sharply during his tenure. His “Marxist miracle” was often under criticism by all sides of the political spectrum as he had a hard time feeding his billion Chinese citizens.
After Mao’s death, the next generation of Chinese leaders had the same concerns about Chinese population growth. In 1979, they became authentic neo-Malthusians and instituted the “one child per couple” policy in many provinces that is still intact today.
The Chinese economic growth story has been amazing. Cities have mushroomed seemingly out of nowhere in recent years that now have more than a million people. The average Chinese saves more than 20% of his income which fuels rapid building, investment, and manufacturing. Chinese schools are now turning out more scientists and engineers than anywhere on earth and the universities are gaining ground globally in academic rankings.
So, China is definitely booming but they are heading for perhaps the worst demographic disaster in measured history. Simply put, their strict one child per couple policy will lead to a shortage of workers. And, a labor shortage normally translates to higher wages, which will hurt the comparative advantage they now hold in manufacturing. By 2025, China is projected to have one fifth of the world’s people but one quarter of the 65+ population. Already, other cracks are appearing. For 2500 years, Chinese sons always took care of their parents. Now, with the single child policy a couple is now expected to care for both sets of parents. As Nicholas Eberstadt of the American Enterprise Institute put it “a de facto national pension system has been the family but that social safety net is now unraveling badly.” Columnist Ted Fishman asks ‘will China grow old before it grows rich?”
Another really freaky and ghoulish demographic anomaly is rearing its head in China. Due to the reverence that Chinese families give sons, many infant girls are put up for adoption and taken to foreign countries. Abortions are often undertaken if it is determined that the newborn will be a girl. So, soon China will have a population where there are 123 young men for every 100 young women. Young women will likely move to the cities where they will be highly prized by young men and only the more successful men will tend to find partners.
For a few decades in the old American West, we had gender imbalances such as this. Alaska might face this in certain regions as well. But for a country of a billion people, this is unprecedented and has to cause huge social problems including crime.
We have all heard the problems about demographics in Western Europe with Spain and Italy getting special attention. Mark Steyn refers to the present as “Europe’s Gelded Age.” The Chinese threat appears much greater. The Chinese economic growth over the last few decades has been nothing short of remarkable. They are big polluters but are taking steps to clean things up. Life is getting better for many millions of Chinese as they enter the middle class each year. But demographics are a tidal wave that no one can hold back and they are going to hit China very hard. All of us have to be impressed with what China has accomplished the past 20 years against stiff odds but taking on demographics is virtually always a losing battle.
Are demographics really that important? Well, when asked that question I always conjure up the old quote from mid-20th century writer and raconteur Damon Runyon: “The race does not always go to the swift nor the battle to the strong, but that’s the way to bet.”
May I suggest that you do not bet your life savings on China, but instead, bet on demographics?
If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com
Sunday, March 27, 2011
Tuesday, March 22, 2011
Behavioral Economics and The Future of Advertising
A few weeks ago I visited a retail store. As I was entering I noticed a fellow about 40 years old standing out front. He was short and easily weighed 300 pounds. To my surprise, he was inhaling deeply on a cigarette. Moving through the store to pick up a few items, my thoughts kept coming back to the guy out front. He was a walking heart attack for sure and a prime candidate for a stroke as well. As I left the store, he had another surprise for me. He lighted a new cigarette with the butt of his dying one. I shook my head sadly and moved on.
Since 1776 and Adam Smith’s “invisible hand” theory, free market economics has always made the assumption that people act in a rational manner. Smith’s invisible hand said essentially that when selfish but rational actions take place across a society, we would be more prosperous overall. Well. The chubby fellow whom I encountered in front of the store was not acting rationally. He was killing himself and not slowly. Were he rational he would go on a diet right away and go cold turkey on the cigarette habit.
The real truth is that as humans we all tend to lean toward emotion. Most of us experience love, jealousy, grief and excitement at times and that clouds our behavior and purchasing.
This concept has been captured in a field known as Behavioral Economics. Back in the 1970’s two psychologists, Amos Tversky and Daniel Kahneman, began to adapt theories on how our brains process information and then contrasted that with the economic models that featured the rational man often dubbed “Homo economicus” (Kahneman won the 2002 Nobel Prize in Economics).
So, there are reasons why 20% of Americans are morbidly obese and some smoke at the same time but they are not being rational. Behavioral Economics is a marriage of Psychology and Economics and will become an increasingly important field for marketers and ad agencies in the years to come. Here are a few core principles of Behavioral Economics that can apply to our life in advertising:
1) Despite when classical and now neo-classical economists may have said, people are moved by value judgments and, sometimes, moral judgments. Many of us every day do what is right rather than what gets the maximum profit to us short term.
2) Economists usually do not distinguish between social and market contexts. An example would be a couple’s 25th wedding anniversary. If a man gives his wife a very nice piece of jewelry she is often touched by it. Were the same fellow to give her a card with a $1000 bill in it, there is an excellent chance that the marriage would not endure for another 25 years. Some economists would argue the economic impact was the same in both cases--$1000 was spent. Behavioral Economics is more nuanced.
3) In financial markets, many of us too often are irrational investors. We buy near the top and sell when the market is bottoming out. People put way too much weight on recent events and do not often think long term, which is rational.
4) Old habits die really hard. Some 20% of Americans are morbidly obese and their girth will derail any hope of cutting future health care expenses. All too few of us examine whether our behavior is optimal.
5) Monkey see, monkey do. We observe others doing things and do not always make decisions based on our own judgment.
Historically, advertising has often made a strong appeal to emotions and we all know that emotion can be a powerful selling tool. So, ad agencies should be comfortable with Behavioral Economics and plug it in to their client service options. Today, at smaller and mid-size shops, people are all too often-dubbed Account Planners, Strategy Officers, or Marketing Directors and they basically rehash syndicated data from Simmons or Mediamark Research, Inc. (MRI). Real pros, if they have not already, should embrace Behavioral Economics. It could really sharpen their marketing effectiveness. If you dig in and understand it, you are able to weigh in on almost all brand interactions. Today, many agencies limit themselves simply to messaging.
For a non-technical primer on Behavioral Economics may I recommend, “Nudge” by Dick Thaler and Cass Sunstein? The authors serve up a host of practical suggestions to nudge people to do the right thing without being perfectly rational. It is easy reading but will make you think clearly about when economics and psychology meet.
If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com
Since 1776 and Adam Smith’s “invisible hand” theory, free market economics has always made the assumption that people act in a rational manner. Smith’s invisible hand said essentially that when selfish but rational actions take place across a society, we would be more prosperous overall. Well. The chubby fellow whom I encountered in front of the store was not acting rationally. He was killing himself and not slowly. Were he rational he would go on a diet right away and go cold turkey on the cigarette habit.
The real truth is that as humans we all tend to lean toward emotion. Most of us experience love, jealousy, grief and excitement at times and that clouds our behavior and purchasing.
This concept has been captured in a field known as Behavioral Economics. Back in the 1970’s two psychologists, Amos Tversky and Daniel Kahneman, began to adapt theories on how our brains process information and then contrasted that with the economic models that featured the rational man often dubbed “Homo economicus” (Kahneman won the 2002 Nobel Prize in Economics).
So, there are reasons why 20% of Americans are morbidly obese and some smoke at the same time but they are not being rational. Behavioral Economics is a marriage of Psychology and Economics and will become an increasingly important field for marketers and ad agencies in the years to come. Here are a few core principles of Behavioral Economics that can apply to our life in advertising:
1) Despite when classical and now neo-classical economists may have said, people are moved by value judgments and, sometimes, moral judgments. Many of us every day do what is right rather than what gets the maximum profit to us short term.
2) Economists usually do not distinguish between social and market contexts. An example would be a couple’s 25th wedding anniversary. If a man gives his wife a very nice piece of jewelry she is often touched by it. Were the same fellow to give her a card with a $1000 bill in it, there is an excellent chance that the marriage would not endure for another 25 years. Some economists would argue the economic impact was the same in both cases--$1000 was spent. Behavioral Economics is more nuanced.
3) In financial markets, many of us too often are irrational investors. We buy near the top and sell when the market is bottoming out. People put way too much weight on recent events and do not often think long term, which is rational.
4) Old habits die really hard. Some 20% of Americans are morbidly obese and their girth will derail any hope of cutting future health care expenses. All too few of us examine whether our behavior is optimal.
5) Monkey see, monkey do. We observe others doing things and do not always make decisions based on our own judgment.
Historically, advertising has often made a strong appeal to emotions and we all know that emotion can be a powerful selling tool. So, ad agencies should be comfortable with Behavioral Economics and plug it in to their client service options. Today, at smaller and mid-size shops, people are all too often-dubbed Account Planners, Strategy Officers, or Marketing Directors and they basically rehash syndicated data from Simmons or Mediamark Research, Inc. (MRI). Real pros, if they have not already, should embrace Behavioral Economics. It could really sharpen their marketing effectiveness. If you dig in and understand it, you are able to weigh in on almost all brand interactions. Today, many agencies limit themselves simply to messaging.
For a non-technical primer on Behavioral Economics may I recommend, “Nudge” by Dick Thaler and Cass Sunstein? The authors serve up a host of practical suggestions to nudge people to do the right thing without being perfectly rational. It is easy reading but will make you think clearly about when economics and psychology meet.
If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com
Tuesday, March 15, 2011
How the West Was Lost
Dambisa Moyo is a brilliant young woman. A P.H.D. in Economics from Oxford and having a master’s degree from the JFK School of Government at Harvard are only the beginning of her impressive credentials. A few years ago, the young Zambian lady shocked the world with a book entitled DEAD AID, which boldly suggested that foreign aid is not working and that there is a better way to help Africa.
Now her next blockbuster is racing up the business best-seller lists. It is entitled HOW THE WEST WAS LOST (Farrar, Strauss and Giroux, 2011) and urges the U.S. and Europe to take corrective action quickly or face financial disaster.
In a very tightly written 195 pages, she makes some very well reasoned arguments. She boils our Gordian knot of difficulties down to three key areas:
1) The capital crisis—too much money diverted into homes rather than building up our infrastructure
2) The huge amount of debt that has created a financial house of cards
3) The labor crisis both in terms of quality and quantity
Her language has a brutal directness that you do not hear anywhere else. Consider this passage on pensions: “Forget Bernie Madoff, forget Alan Stanford, the biggest Ponzi scheme has got to be the looming car crash that is Western pension funds. And like any well-run Ponzi game, its results will be devastating. It will all end in tears.” She goes on say that her generation will face “double taxation” of having to foot the bill for current retirees and somehow save for their own.
Her coverage of the housing crisis and how the West got there is similar to others that I have seen but she raises issues that others do not. In Canada or the United Kingdom if you walk away from your home, you are still liable for the remaining mortgage. In many U.S. states, she points out, a walk-away is the bank’s problems and ultimately that of society.
The book concludes with a withering finale of tough love. She has a section entitled “all is not lost.” Her four possible scenarios are all scary but certainly possible and likely if we continue on our current path. In brief, they are:
1) The Status Quo—we continue to spend, neglect education, and remain the pre-eminent military power. If this continues the US (along with much of the West) will be second tier economies as the debt overwhelms over.
2) China Falters—somehow the Chinese cannot keep growth going and they do not overtake us. She says it is possible but not likely.
3) America Fights Back—we go on a fiscal diet, get real in all areas, and return to the bright days. She asks if we have the will to do this plus will we or can we give up our role as the world’s policeman? Also, other countries will have to virtually always play fair on trade and other issues if we are to solve our problems. Is that realistic?
4) America’s Nuclear Options?—These are tough choices. She suggests that we become less open and more protectionist as we get our house in order. Also, she tells us that the US has benefited the least from being open to global development. Then comes the bombshell. To get out of the mess, America may have to default on its debt. This would hurt the Chinese but she thinks that the world might forgive us faster than we think. Or, we can do a de-facto default by inflating our way out of the mess (this seems to be happening now to a certain degree). If we do not do one of these things she suggests that “many fear America will remain in a stranglehold of debt and dependence from which it will be very difficult to credibly escape.”
Someone wrote to me and suggested that a young Zambian is not the person to dissect our problems. My answer was one a wise man once told me—“Understanding requires distance. We cannot read a book by rubbing it against our eyes.”
Ms. Moyo has given us a shrill wake-up call. Will we respond to it?
Should you be unwilling or unable to read the book, check out Ms. Moyo on YouTube. There are several great interviews with her there.
If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com
Now her next blockbuster is racing up the business best-seller lists. It is entitled HOW THE WEST WAS LOST (Farrar, Strauss and Giroux, 2011) and urges the U.S. and Europe to take corrective action quickly or face financial disaster.
In a very tightly written 195 pages, she makes some very well reasoned arguments. She boils our Gordian knot of difficulties down to three key areas:
1) The capital crisis—too much money diverted into homes rather than building up our infrastructure
2) The huge amount of debt that has created a financial house of cards
3) The labor crisis both in terms of quality and quantity
Her language has a brutal directness that you do not hear anywhere else. Consider this passage on pensions: “Forget Bernie Madoff, forget Alan Stanford, the biggest Ponzi scheme has got to be the looming car crash that is Western pension funds. And like any well-run Ponzi game, its results will be devastating. It will all end in tears.” She goes on say that her generation will face “double taxation” of having to foot the bill for current retirees and somehow save for their own.
Her coverage of the housing crisis and how the West got there is similar to others that I have seen but she raises issues that others do not. In Canada or the United Kingdom if you walk away from your home, you are still liable for the remaining mortgage. In many U.S. states, she points out, a walk-away is the bank’s problems and ultimately that of society.
The book concludes with a withering finale of tough love. She has a section entitled “all is not lost.” Her four possible scenarios are all scary but certainly possible and likely if we continue on our current path. In brief, they are:
1) The Status Quo—we continue to spend, neglect education, and remain the pre-eminent military power. If this continues the US (along with much of the West) will be second tier economies as the debt overwhelms over.
2) China Falters—somehow the Chinese cannot keep growth going and they do not overtake us. She says it is possible but not likely.
3) America Fights Back—we go on a fiscal diet, get real in all areas, and return to the bright days. She asks if we have the will to do this plus will we or can we give up our role as the world’s policeman? Also, other countries will have to virtually always play fair on trade and other issues if we are to solve our problems. Is that realistic?
4) America’s Nuclear Options?—These are tough choices. She suggests that we become less open and more protectionist as we get our house in order. Also, she tells us that the US has benefited the least from being open to global development. Then comes the bombshell. To get out of the mess, America may have to default on its debt. This would hurt the Chinese but she thinks that the world might forgive us faster than we think. Or, we can do a de-facto default by inflating our way out of the mess (this seems to be happening now to a certain degree). If we do not do one of these things she suggests that “many fear America will remain in a stranglehold of debt and dependence from which it will be very difficult to credibly escape.”
Someone wrote to me and suggested that a young Zambian is not the person to dissect our problems. My answer was one a wise man once told me—“Understanding requires distance. We cannot read a book by rubbing it against our eyes.”
Ms. Moyo has given us a shrill wake-up call. Will we respond to it?
Should you be unwilling or unable to read the book, check out Ms. Moyo on YouTube. There are several great interviews with her there.
If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com
Friday, March 11, 2011
Is Consumerism Dead?
Lately, as we the economy slowly claws its way back to some semblance of growth, we are hearing an interesting mix of marketers, political pundits, psychologists, financial counselors and columnists all saying the Great Recession has changed Americans permanently.
The idea is that the wild consumption binge that many Americans have been on for the last few decades has come to an end. This morning we hear that the savings rate is now at 5.8 % which is way above pre-recession levels of zero-1.5%. Many say that hard work and thrift are making a comeback as we return to old values and rely on collaboration to solve problems and now clearly see the failings of the old status symbols.
I am not so sure that is what is happening. If a few years from now the economy is booming will people revert to their old spendthrift ways? It is not clear to me where we will go.
For a moment, let us look at the facts of the Great Recession. Unemployment doubled and is now at 8.9% but almost everyone admits that the real rate is much higher as millions of discouraged citizens have given up looking for work. From late 2007 through 2009 an amazing 13 trillion dollars of wealth evaporated in the U.S. Besides unemployment soaring, 401k plans shrunk, roughly a third of the equity in homes disappeared and, amazingly, some one quarter of all mortgaged homes were under water (meaning current value of home was less than existing mortgage balance).
The spending that went on was amazing. Take housing. In 1950, the average U.S. home being built was 983 square feet. By the end of 2006, it was at approximately 2,350 square feet. Buy a house, everyone seemed to be saying to young people. It can only keep going up in value. And, by 2007, mortgage equity withdrawal, where people refinanced with a cash out option on their equity line of credit, actually was 9% of the U.S. disposable income! Looking at it another way, in 1982, a recession year, household debt was equal to 44% of Gross Domestic Product while by the end of 2007 it was actually over 100%. You did not have to be financial genius to see that this was not sustainable but if you talked about the dangers of it you were dismissed as a Cassandra.
Now, it is clear that many people are not going back to their old spending habits. If you are permanently unemployed or under-employed, you have to had to make painful lifestyle shifts. Your days of using your home as a veritable ATM machine or super credit card are over. But for those who still have decent jobs how long will this new austerity last? When will greed overcome fear?
Clearly, people are still nervous. Yet, I remember when gas briefly touched $4.00 a gallon in summer 2008 when oil topped $146 a barrel. You could not give an SUV away. But several months later when oil cratered to $33 per barrel, the SUV’s flew off the dealer lots with an abandon again. Now, as gas at the pump moves up due to Middle Eastern political tensions, the pattern seems to be repeating itself.
Unless you are in advanced old age, the Great Recession is easily the worst financial calamity that you have witnessed in your lifetime. The Great Depression of the 1930’s psychically scarred our parents or grandparents. They became more frugal and, for the rest of their lives, were net savers and cautious investors. Was the Great Recession a similar event for ALL of us?
Are we truly moving from a credit to debit society? Is the old cliché about the Indestructible American Spirit that is infinitely resilient and able to turn any hardship into opportunity still valid?
I remain on the fence. Long term we need to address our entitlements that will take the entire economy down in several years unless we have reform in the Social Security, Medicaid and Medicare plans. But with stocks up 80% from the March 2009 lows, is the “wealth effect” kicking back in among the affluent? So far, the ostentatious displays of wealth that began in the 1980’s and lasted nearly 25 years have been muted.
Our business, however, seems to be ignoring the trend to austerity if it really has legs. TV programming still goes toward the glitzy and the idealized lifestyle is one great material comfort. Do you see a resurgence of programming like “The Waltons” or “Little House on the Prairie” that epitomize the return to honesty, fairness, and authenticity that many say are reappearing in American life these days as a result of the recession?
All of us want a return to vibrant prosperity. Will it be built on our newfound savings and realism about entitlements or will it be a return to the house of cards that we built with plastic in recent decades?
I only know this for sure. Markets always go to extremes and they are full of endless volatility. As consumers get more in charge in our digital age, they are also harder to predict. But, human nature does not change. Much of me hopes that the new thrift is permanent. Recovery will be slower but it has a chance to be longer lasting than that of the era of consumerism.
If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com
The idea is that the wild consumption binge that many Americans have been on for the last few decades has come to an end. This morning we hear that the savings rate is now at 5.8 % which is way above pre-recession levels of zero-1.5%. Many say that hard work and thrift are making a comeback as we return to old values and rely on collaboration to solve problems and now clearly see the failings of the old status symbols.
I am not so sure that is what is happening. If a few years from now the economy is booming will people revert to their old spendthrift ways? It is not clear to me where we will go.
For a moment, let us look at the facts of the Great Recession. Unemployment doubled and is now at 8.9% but almost everyone admits that the real rate is much higher as millions of discouraged citizens have given up looking for work. From late 2007 through 2009 an amazing 13 trillion dollars of wealth evaporated in the U.S. Besides unemployment soaring, 401k plans shrunk, roughly a third of the equity in homes disappeared and, amazingly, some one quarter of all mortgaged homes were under water (meaning current value of home was less than existing mortgage balance).
The spending that went on was amazing. Take housing. In 1950, the average U.S. home being built was 983 square feet. By the end of 2006, it was at approximately 2,350 square feet. Buy a house, everyone seemed to be saying to young people. It can only keep going up in value. And, by 2007, mortgage equity withdrawal, where people refinanced with a cash out option on their equity line of credit, actually was 9% of the U.S. disposable income! Looking at it another way, in 1982, a recession year, household debt was equal to 44% of Gross Domestic Product while by the end of 2007 it was actually over 100%. You did not have to be financial genius to see that this was not sustainable but if you talked about the dangers of it you were dismissed as a Cassandra.
Now, it is clear that many people are not going back to their old spending habits. If you are permanently unemployed or under-employed, you have to had to make painful lifestyle shifts. Your days of using your home as a veritable ATM machine or super credit card are over. But for those who still have decent jobs how long will this new austerity last? When will greed overcome fear?
Clearly, people are still nervous. Yet, I remember when gas briefly touched $4.00 a gallon in summer 2008 when oil topped $146 a barrel. You could not give an SUV away. But several months later when oil cratered to $33 per barrel, the SUV’s flew off the dealer lots with an abandon again. Now, as gas at the pump moves up due to Middle Eastern political tensions, the pattern seems to be repeating itself.
Unless you are in advanced old age, the Great Recession is easily the worst financial calamity that you have witnessed in your lifetime. The Great Depression of the 1930’s psychically scarred our parents or grandparents. They became more frugal and, for the rest of their lives, were net savers and cautious investors. Was the Great Recession a similar event for ALL of us?
Are we truly moving from a credit to debit society? Is the old cliché about the Indestructible American Spirit that is infinitely resilient and able to turn any hardship into opportunity still valid?
I remain on the fence. Long term we need to address our entitlements that will take the entire economy down in several years unless we have reform in the Social Security, Medicaid and Medicare plans. But with stocks up 80% from the March 2009 lows, is the “wealth effect” kicking back in among the affluent? So far, the ostentatious displays of wealth that began in the 1980’s and lasted nearly 25 years have been muted.
Our business, however, seems to be ignoring the trend to austerity if it really has legs. TV programming still goes toward the glitzy and the idealized lifestyle is one great material comfort. Do you see a resurgence of programming like “The Waltons” or “Little House on the Prairie” that epitomize the return to honesty, fairness, and authenticity that many say are reappearing in American life these days as a result of the recession?
All of us want a return to vibrant prosperity. Will it be built on our newfound savings and realism about entitlements or will it be a return to the house of cards that we built with plastic in recent decades?
I only know this for sure. Markets always go to extremes and they are full of endless volatility. As consumers get more in charge in our digital age, they are also harder to predict. But, human nature does not change. Much of me hopes that the new thrift is permanent. Recovery will be slower but it has a chance to be longer lasting than that of the era of consumerism.
If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com
Thursday, February 24, 2011
Another Look at Market by Market Media Planning
Someone recently was e-mailing me back and forth about various aspects of media planning. At one point, he wrote “I guess you will now bring up the topic of Market by Market Planning. After all, you basically made a career of it.” He probably did not mean it kindly. I was not offended, however. In fact, I am proud to plead guilty.
Market by Market Media Planning recognizes a few truths in the U.S. marketplace. The first is that there are 210 Nielsen DMA’s in the U.S. No two are alike. TV viewing levels, Radio usage, cable and satellite penetration and usage vary significantly from place to place as do internet usage and even sagging newspaper readership. If you really want to execute a proper media plan, you must know the markets that you are operating in and you get a fairly tight handle on what the national media that you buy are delivering in each key marketplace.
This may seem counter-intuitive, but the most sensitive market by market analysis tends to be done outside of the major agency hubs. How is that possible? Well, if you are plotting media strategy for a client that advertises in 15 markets in America’s heartland, you face a few challenges. You don’t have national media and its great efficiencies and your client’s pockets are not all that deep. But, if you do the proper digging you can level the playing field significantly for your greatly outspent client.
The really good practitioners of market by market planning are intense and real wonks. They know their markets cold. As a result, they do not deliver a media plan. They deliver plans. A very difficult man whom I once worked with paid me the most meaningful compliment of my career in a client meeting. He said, “Don, will deliver you as many media plans as you have markets.” He was not being a salesman. He knew me.
A good market by market approach often starts with a BDI/CDI analysis. It is pretty straight forward although many young people are not taught it anymore. BDI stands for Brand Development Index which is local sales in a market indexed to overall brand sales (so if Market X is 1% of the US and you have 1.5% of your total sales there, your BDI is 150). Similarly, CDI is Category Development Index is local sales for the category relative to total category sales. Sometimes, smaller players cannot get their hands on such category data.
As a general rule, you tend to add more weight to markets that have high brand potential and high category potential (the old fish where the fish are thesis). Also, you may want to add to markets with high brand potential but low category potential. Individual analysis is always required.
Then, the next step that many of us used was to provide relative costs across markets. A great case came up in the go-go 1980’s. At that time, Cleveland, the rust belt queen, was approximately the same size in terms of TV households as Houston, a Southwestern boom town. But TV in Houston cost twice as much per household reached as Cleveland. Our client let us add weight in Cleveland and he claimed that we squeezed significantly more cases of out that market over the year. More importantly, the money we saved by not spending more in Houston allowed us to prop up several mid-sized opportunity markets with decent radio schedules. Such opportunities and cost imbalances still exist in 2011 but how many dig to ferret them out?
Market by market focused planners use radio better than most. They look at distribution in each market and the relative costs of each medium in each market. Often, metro radio is a better play if money is tight or distribution not strong across the much larger DMA. When they use TV, they customize a day-part mix for each DMA. Outdoor often plays a larger role or is the sole medium in some markets.
If you execute well in each market, good things usually happen. I know that many of us who embraced authentic market by market activity saved clients millions over the years. How much did we increase sales? Impossible to say but it had to be stronger than a cookie cutter plan that is virtually the same everywhere.
National advertisers should key on market by market considerations as well but few do it well. Many people feel that the network TV or national magazine efficiencies even things out. But, in reality, they do not. Few, if any, products with national distribution have flat sales across the country. Everyone has strongholds and almost every product underachieves somewhere. Also, media delivery is not consistent either. If you buy a 1000 rating points on network TV, you may deliver 1300 in Montgomery, Alabama but only 730 in San Francisco. Many players add weight in the top 10 or top 20 markets. That helps in some cases but they would generally be better served if they did an extensive BDI/CDI analysis, did a relative cost index for favored media, and added the right medium to local markets where it had the best chance of doing some good.
Importantly, with on-line media, a great deal of work needs to be done to reflect market by market projections and their blending with conventional media.
Why doesn’t everyone do market by market right? Well, it takes time. And, today, time is money. Understaffed teams with untrained personnel get people on the air and many negotiate terrific rates. But great costs only take you so far if the messages are not landing sufficiently in the optimal roster of markets.
Has market by market planning disappeared? No, but most people do not go far enough in their analyses. And, the best practitioners, as mentioned above, are often off the beaten path. People in places such as Burlington, Akron, Omaha, Salt Lake and Portland, Oregon are often doing great work for moderate sized clients. Each market gets a truly customized media effort and they have made their client more competitive in a tough environment. Ask your agency about market to market considerations and probe a bit. You may be pleasantly surprised or you may be justifiably annoyed.
If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com
Market by Market Media Planning recognizes a few truths in the U.S. marketplace. The first is that there are 210 Nielsen DMA’s in the U.S. No two are alike. TV viewing levels, Radio usage, cable and satellite penetration and usage vary significantly from place to place as do internet usage and even sagging newspaper readership. If you really want to execute a proper media plan, you must know the markets that you are operating in and you get a fairly tight handle on what the national media that you buy are delivering in each key marketplace.
This may seem counter-intuitive, but the most sensitive market by market analysis tends to be done outside of the major agency hubs. How is that possible? Well, if you are plotting media strategy for a client that advertises in 15 markets in America’s heartland, you face a few challenges. You don’t have national media and its great efficiencies and your client’s pockets are not all that deep. But, if you do the proper digging you can level the playing field significantly for your greatly outspent client.
The really good practitioners of market by market planning are intense and real wonks. They know their markets cold. As a result, they do not deliver a media plan. They deliver plans. A very difficult man whom I once worked with paid me the most meaningful compliment of my career in a client meeting. He said, “Don, will deliver you as many media plans as you have markets.” He was not being a salesman. He knew me.
A good market by market approach often starts with a BDI/CDI analysis. It is pretty straight forward although many young people are not taught it anymore. BDI stands for Brand Development Index which is local sales in a market indexed to overall brand sales (so if Market X is 1% of the US and you have 1.5% of your total sales there, your BDI is 150). Similarly, CDI is Category Development Index is local sales for the category relative to total category sales. Sometimes, smaller players cannot get their hands on such category data.
As a general rule, you tend to add more weight to markets that have high brand potential and high category potential (the old fish where the fish are thesis). Also, you may want to add to markets with high brand potential but low category potential. Individual analysis is always required.
Then, the next step that many of us used was to provide relative costs across markets. A great case came up in the go-go 1980’s. At that time, Cleveland, the rust belt queen, was approximately the same size in terms of TV households as Houston, a Southwestern boom town. But TV in Houston cost twice as much per household reached as Cleveland. Our client let us add weight in Cleveland and he claimed that we squeezed significantly more cases of out that market over the year. More importantly, the money we saved by not spending more in Houston allowed us to prop up several mid-sized opportunity markets with decent radio schedules. Such opportunities and cost imbalances still exist in 2011 but how many dig to ferret them out?
Market by market focused planners use radio better than most. They look at distribution in each market and the relative costs of each medium in each market. Often, metro radio is a better play if money is tight or distribution not strong across the much larger DMA. When they use TV, they customize a day-part mix for each DMA. Outdoor often plays a larger role or is the sole medium in some markets.
If you execute well in each market, good things usually happen. I know that many of us who embraced authentic market by market activity saved clients millions over the years. How much did we increase sales? Impossible to say but it had to be stronger than a cookie cutter plan that is virtually the same everywhere.
National advertisers should key on market by market considerations as well but few do it well. Many people feel that the network TV or national magazine efficiencies even things out. But, in reality, they do not. Few, if any, products with national distribution have flat sales across the country. Everyone has strongholds and almost every product underachieves somewhere. Also, media delivery is not consistent either. If you buy a 1000 rating points on network TV, you may deliver 1300 in Montgomery, Alabama but only 730 in San Francisco. Many players add weight in the top 10 or top 20 markets. That helps in some cases but they would generally be better served if they did an extensive BDI/CDI analysis, did a relative cost index for favored media, and added the right medium to local markets where it had the best chance of doing some good.
Importantly, with on-line media, a great deal of work needs to be done to reflect market by market projections and their blending with conventional media.
Why doesn’t everyone do market by market right? Well, it takes time. And, today, time is money. Understaffed teams with untrained personnel get people on the air and many negotiate terrific rates. But great costs only take you so far if the messages are not landing sufficiently in the optimal roster of markets.
Has market by market planning disappeared? No, but most people do not go far enough in their analyses. And, the best practitioners, as mentioned above, are often off the beaten path. People in places such as Burlington, Akron, Omaha, Salt Lake and Portland, Oregon are often doing great work for moderate sized clients. Each market gets a truly customized media effort and they have made their client more competitive in a tough environment. Ask your agency about market to market considerations and probe a bit. You may be pleasantly surprised or you may be justifiably annoyed.
If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com
Thursday, February 17, 2011
Ad Agency Media Teams--The View from Salespeople
A few weeks ago I received a long and detailed e-mail from someone whom I have known for over 30 years. He was an excellent sales executive who eventually morphed into a really good broadcaster. And, he is still active in the business. His e-mail at times was something of a rant but, despite the passion, it made a lot of sense. He finished with the following: “There is too much lazy marketing going on at agencies. They continue to do what they have always done. Yes, they are playing with social media but they have no clue about it. What they need to do is more Branding.”
I canvassed a host of other people who were in media sales and the frustration level was amazing. So this post will give you a view of agency media teams from a sales executive perspective. Everyone in my sample is successful and has been in the business a minimum of 15 years. They are from all over the country—good balance from each region. All are people whom I know and have always considered to be smart and fair. I interviewed or exchanged e-mails with 25 people and what follows is a representative sampling of their opinions.
First, let us hear from a man with whom I have done business for over 20 years. He is easily the most gentlemanly person with whom I have ever worked. His product is now a multi-platform offering that can work for many substantial advertisers. Here is how he weighs in on media teams in 2011: “My biggest complaint is the lack of sincere contact. Nearly everything is done through e-mail, voice mail and very easy for the 20 somethings to ignore or delete. Even an old geezer such as I knows that in this computer oriented world things are going to change and just keep getting faster and less personal. For companies with a complicated product offering like ours that requires some explanation, this presents a problem even if we can be of real benefit to their clients. Also, today there is a lack of simple courtesy….people often do not return phone calls or even e-mails. Lastly, the young people do not understand that if you agree to take a meeting you need to actually do it. My sales team makes the effort to make contact, travels to a distant city at our expense, and often gets stood up when they arrive. It is maddening.”
Another long time friend who sets the standard for high ethics said the following:
“I think one of the biggest problems with agencies is that they are not set up to effectively evaluate over-all marketing opportunities. In today’s world, the hugely different opportunities that are brought to agencies often scream for a unique evaluation for each one. So many different elements are brought together (TV, Internet, Print, Activation) but the agencies usually stick it all into a cookie cutter evaluation and potentially risk not recommending things that can deliver a ‘grass roots’ activation model that will really help the client as a whole. Instead they go to a traditional media buy with very little imagination included……there are far too few people out there who can really evaluate a multi-faceted package.”
A gregarious and deeply experienced exec shares this sentiment: “You have struck a nerve, my friend. There is no incoming and teachable entry level talent who are being taught how to interpret proposals and ask questions. There is a moat of experience between veteran media people who think out of the box and the one dimensional “my cost per point is X and that is all I care about" attitude of the new comers. "Training, you ask? What training"?
A vivacious and lively TV exec who sells coast to coast is more sympathetic—“First and foremost, EVERY MEDIA TEAM seems to be undermanned…too much to do…too few workers and this appears to be by design. This is a common theme from NYC to LA. I think everyone gets the “we have got to do more with less” concept but at some point (soon) clients will see clearly that the model is broken. And today the client is suffering because the agency is trying to keep costs at the lowest levels.” This is undeniably true. She raises another vital point—“Because they are undermanned, media departments do not encourage salespeople to come in and educate all on new innovations available to them. Interestingly, some of these new opportunities might dovetail with the client’s needs and by incorporating them into the plan/buy, the agency could look like a winner.”
Sales people who do not work for major properties simply cannot get appointments. One agency media chief says that he will only see people from Google, ESPN and Sports Illustrated. He loves their swag and the whole team sits in. That is great for those three outstanding properties but the agency does regional business at best and there are local people who could help him with his clients if he would give them a hearing.
Some sales people close to retirement are resigned to what is going on. A West Coast sales maven says “The golden years are gone. I cannot develop a relationship with the newcomers. Media is now a commodity in their eyes and something is lost forever when that attitude took hold”.
Another adds “The game is almost over. The technology will soon be in place where a lot more will be done electronically. I am a dinosaur, and know it but it has been one hell of a ride since 1970. No one under 40 that I call on can really sort out value. They have no intuitive feel for things. Others lack the math skills to unravel a multi-platform deal.”
Finally, a mid-west sales star says “when I started in the business 35 years ago, I was in awe of the agency media teams. Now, the superstars are not going into advertising. I do not see that turning around in an economy that is over 40% financially oriented.
What do I think? Well, lots of things are moving toward commodity status and media is one of them. It is sad but in the defense of the agency people that I still speak with and like and admire, many are really overworked. The client suffers as one of my panel members pointed out. But with agencies suffering strong financial pressure, there does not seem to be an easy way out.
Courtesy needs to make a comeback. If someone made an appointment with me, I kept it. There were nights that I had to stay a couple of hours late as a result, but no out of towner was ever greeted by a receptionist saying that Don was not available. Also, as I always say, you can learn a lot by listening. Sales reps are always on the move, talks to hundreds of people, and work for firms that have some cutting edge products developed at headquarters. Media teams need to make time for them. Our world is changing and buying solely on cost per points is gone with the wind. Yet, sadly, it still goes on.
Sales people need to be concise and respectful of the media team’s time. But if they cannot get in to see the agency team, something is very wrong.
Will things turn around? I believe that the glass is half full, but it is hard to believe that the pendulum will swing back any time soon.
If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com
I canvassed a host of other people who were in media sales and the frustration level was amazing. So this post will give you a view of agency media teams from a sales executive perspective. Everyone in my sample is successful and has been in the business a minimum of 15 years. They are from all over the country—good balance from each region. All are people whom I know and have always considered to be smart and fair. I interviewed or exchanged e-mails with 25 people and what follows is a representative sampling of their opinions.
First, let us hear from a man with whom I have done business for over 20 years. He is easily the most gentlemanly person with whom I have ever worked. His product is now a multi-platform offering that can work for many substantial advertisers. Here is how he weighs in on media teams in 2011: “My biggest complaint is the lack of sincere contact. Nearly everything is done through e-mail, voice mail and very easy for the 20 somethings to ignore or delete. Even an old geezer such as I knows that in this computer oriented world things are going to change and just keep getting faster and less personal. For companies with a complicated product offering like ours that requires some explanation, this presents a problem even if we can be of real benefit to their clients. Also, today there is a lack of simple courtesy….people often do not return phone calls or even e-mails. Lastly, the young people do not understand that if you agree to take a meeting you need to actually do it. My sales team makes the effort to make contact, travels to a distant city at our expense, and often gets stood up when they arrive. It is maddening.”
Another long time friend who sets the standard for high ethics said the following:
“I think one of the biggest problems with agencies is that they are not set up to effectively evaluate over-all marketing opportunities. In today’s world, the hugely different opportunities that are brought to agencies often scream for a unique evaluation for each one. So many different elements are brought together (TV, Internet, Print, Activation) but the agencies usually stick it all into a cookie cutter evaluation and potentially risk not recommending things that can deliver a ‘grass roots’ activation model that will really help the client as a whole. Instead they go to a traditional media buy with very little imagination included……there are far too few people out there who can really evaluate a multi-faceted package.”
A gregarious and deeply experienced exec shares this sentiment: “You have struck a nerve, my friend. There is no incoming and teachable entry level talent who are being taught how to interpret proposals and ask questions. There is a moat of experience between veteran media people who think out of the box and the one dimensional “my cost per point is X and that is all I care about" attitude of the new comers. "Training, you ask? What training"?
A vivacious and lively TV exec who sells coast to coast is more sympathetic—“First and foremost, EVERY MEDIA TEAM seems to be undermanned…too much to do…too few workers and this appears to be by design. This is a common theme from NYC to LA. I think everyone gets the “we have got to do more with less” concept but at some point (soon) clients will see clearly that the model is broken. And today the client is suffering because the agency is trying to keep costs at the lowest levels.” This is undeniably true. She raises another vital point—“Because they are undermanned, media departments do not encourage salespeople to come in and educate all on new innovations available to them. Interestingly, some of these new opportunities might dovetail with the client’s needs and by incorporating them into the plan/buy, the agency could look like a winner.”
Sales people who do not work for major properties simply cannot get appointments. One agency media chief says that he will only see people from Google, ESPN and Sports Illustrated. He loves their swag and the whole team sits in. That is great for those three outstanding properties but the agency does regional business at best and there are local people who could help him with his clients if he would give them a hearing.
Some sales people close to retirement are resigned to what is going on. A West Coast sales maven says “The golden years are gone. I cannot develop a relationship with the newcomers. Media is now a commodity in their eyes and something is lost forever when that attitude took hold”.
Another adds “The game is almost over. The technology will soon be in place where a lot more will be done electronically. I am a dinosaur, and know it but it has been one hell of a ride since 1970. No one under 40 that I call on can really sort out value. They have no intuitive feel for things. Others lack the math skills to unravel a multi-platform deal.”
Finally, a mid-west sales star says “when I started in the business 35 years ago, I was in awe of the agency media teams. Now, the superstars are not going into advertising. I do not see that turning around in an economy that is over 40% financially oriented.
What do I think? Well, lots of things are moving toward commodity status and media is one of them. It is sad but in the defense of the agency people that I still speak with and like and admire, many are really overworked. The client suffers as one of my panel members pointed out. But with agencies suffering strong financial pressure, there does not seem to be an easy way out.
Courtesy needs to make a comeback. If someone made an appointment with me, I kept it. There were nights that I had to stay a couple of hours late as a result, but no out of towner was ever greeted by a receptionist saying that Don was not available. Also, as I always say, you can learn a lot by listening. Sales reps are always on the move, talks to hundreds of people, and work for firms that have some cutting edge products developed at headquarters. Media teams need to make time for them. Our world is changing and buying solely on cost per points is gone with the wind. Yet, sadly, it still goes on.
Sales people need to be concise and respectful of the media team’s time. But if they cannot get in to see the agency team, something is very wrong.
Will things turn around? I believe that the glass is half full, but it is hard to believe that the pendulum will swing back any time soon.
If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com
Friday, February 11, 2011
The Medium is STILL the message
A few weeks ago, like many of you, I attended a screening of the film, “The King’s Speech.” Marvelously produced and acted by a great ensemble cast, it shows how Prince Albert, the Duke of York overcame a terrible stammer and was able to function giving speeches and radio addresses as King George VI of the United Kingdom. As a media person, one scene stuck me hard that most in the audience did not fully appreciate. His difficult father, King George V told his son that he must learn to speak better and master radio addresses as that was now part of what it was to be king in 1936. Being a good man, fair and decent, was not enough. You had to master the new medium to be a successful monarch (for a great biography of George VI, consider The Reluctant King by Sarah Bradford, St. Martins Press, 1989).
A few months from now we will mark the 100th anniversary of the birth of Marshall McLuhan. He was a Canadian communications theorist who was famous for two turns of phrase—1) the global village and 2) The Medium is the Message.
As a student, I vividly remember struggling with McLuhan. He was deep and not easy to digest. It is fair to say that he has been misinterpreted by more people than anyone else in the communications field. What I see him as is clearly the greatest media futurist ever.
Consider this statement way back in 1961: “print culture would be brought to an end by electronic interdependence. Electronic media would replace visual culture. Human kind will move toward individualism and fragmentation and our collective identity with a tribal base. The new group could be called a global village.”
The following year he wrote: “the next medium, whatever it is…..it may be the extension of consciousness, will include television as its content, not as its environment, and will transform television into an art form. A computer as a research and communications instrument could enhance retrieval; mass brick & mortar library organizations could be made obsolete, retrieve the individual’s encyclopedic function and flip in to a private line to speedily tailored data of a salable kind”.
Wow! Move over Nostradomus! McLuhan forecasts many aspects of the digital world, Google and Facebook and he doesn’t use obtuse rhyming couplets to do it.
In 1964, his use of the term “The Medium is the Message” first surfaced. Here is my take on it. McLuhan felt that the media are extensions of our human senses, bodies and minds. Media, then, is the message in that the force of media embeds itself in the content, creating a “symbiotic relationship by which the medium influences how the message is perceived”. He also said that the"content should not be studied as much as the media that caused it.” McLuhan always hammered away at the point that we do not often realize the social implications of a medium until “our values, norms, and way of doing things have been altered by the technology.” An example he often used was that when you turned a TV on in a crowded room everyone would get silent. Now with cell phones, e-mail, texting and twitter we communicate but do not talk nearly as much as we once did.
“The Medium is the Message” hit me hard at an early age but I did not realize it until 10 years later. One night in October, 1960 my father and I were driving alone somewhere. He put on the radio and the first Kennedy-Nixon debate was underway. We rode in silence for a few miles and my dad said “sounds like Nixon is getting the better of him”. When we arrived home my oldest sibling greeted us with “wasn’t Jack great. He had lots of facts and figures. He won the debate easily.” I was just a kid and did not want to argue with my college bound brother who devoured TIME magazine cover to cover each week and was very well informed.
About 10 years later, I saw Howard K. Smith of ABC News being interviewed. He said he was the moderator that night and by positioning could hear the candidates but not really see them. It was as if he were listening to the debate on the radio. His scoring was that Nixon had won easily on points. But the TV audience and the press the next day heralded it as triumph for the young Senator from Massachusetts.
Kennedy was better looking than Nixon which helped in a visual medium. Nixon had been ill and was running a fever prior to the telecast. He did not have an expert makeup man and Kennedy did. The medium of TV was the message not the content of the debate to some degree.
A short time later, I saw Marshall McLuhan on with Dick Cavett. When asked to explain how “the medium is the message” he used the Kennedy-Nixon debate as an example. He challenged the audience to objectively listen to a tape of the show and decide who won. I recently did it and he was right. (Full disclosure—I didn’t like Dick Nixon. He took too long to unwind the Vietnam War; he tried to cover up Watergate and thus almost destroyed our two party system. On August 15, 1971,he instituted wage & price controls and severed all ties to the dollar and gold which will haunt us eventually. Also, he did the shameful and un-American thing of having a White House “enemies list” while in office. But if you LISTEN to the debate, Nixon won it!)
McLuhan said that we focus on the obvious way too much. The obvious is the content but what about the subtle changes that occur due to the medium being used?
So George V told the future George VI to overcome his stammer and embrace the radio. In the 1930-1950’s that medium was the message in many cases. As we moved in to the TV age, it overshadowed content. How much have the media contributed this week to the overthrow of an Egyptian dictator? Perhaps more than the real content which is the valid complaints of an oppressed people. Now, we have a whole new array of digital entrants. The internet, You Tube, Facebook, Twitter and the next generation that may only be 24-36 months away. (Does anyone remember MySpace?)
In July of this year, had he been long lived, McLuhan would have turned 100. Well,the medium is STILL the message.
If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com
A few months from now we will mark the 100th anniversary of the birth of Marshall McLuhan. He was a Canadian communications theorist who was famous for two turns of phrase—1) the global village and 2) The Medium is the Message.
As a student, I vividly remember struggling with McLuhan. He was deep and not easy to digest. It is fair to say that he has been misinterpreted by more people than anyone else in the communications field. What I see him as is clearly the greatest media futurist ever.
Consider this statement way back in 1961: “print culture would be brought to an end by electronic interdependence. Electronic media would replace visual culture. Human kind will move toward individualism and fragmentation and our collective identity with a tribal base. The new group could be called a global village.”
The following year he wrote: “the next medium, whatever it is…..it may be the extension of consciousness, will include television as its content, not as its environment, and will transform television into an art form. A computer as a research and communications instrument could enhance retrieval; mass brick & mortar library organizations could be made obsolete, retrieve the individual’s encyclopedic function and flip in to a private line to speedily tailored data of a salable kind”.
Wow! Move over Nostradomus! McLuhan forecasts many aspects of the digital world, Google and Facebook and he doesn’t use obtuse rhyming couplets to do it.
In 1964, his use of the term “The Medium is the Message” first surfaced. Here is my take on it. McLuhan felt that the media are extensions of our human senses, bodies and minds. Media, then, is the message in that the force of media embeds itself in the content, creating a “symbiotic relationship by which the medium influences how the message is perceived”. He also said that the"content should not be studied as much as the media that caused it.” McLuhan always hammered away at the point that we do not often realize the social implications of a medium until “our values, norms, and way of doing things have been altered by the technology.” An example he often used was that when you turned a TV on in a crowded room everyone would get silent. Now with cell phones, e-mail, texting and twitter we communicate but do not talk nearly as much as we once did.
“The Medium is the Message” hit me hard at an early age but I did not realize it until 10 years later. One night in October, 1960 my father and I were driving alone somewhere. He put on the radio and the first Kennedy-Nixon debate was underway. We rode in silence for a few miles and my dad said “sounds like Nixon is getting the better of him”. When we arrived home my oldest sibling greeted us with “wasn’t Jack great. He had lots of facts and figures. He won the debate easily.” I was just a kid and did not want to argue with my college bound brother who devoured TIME magazine cover to cover each week and was very well informed.
About 10 years later, I saw Howard K. Smith of ABC News being interviewed. He said he was the moderator that night and by positioning could hear the candidates but not really see them. It was as if he were listening to the debate on the radio. His scoring was that Nixon had won easily on points. But the TV audience and the press the next day heralded it as triumph for the young Senator from Massachusetts.
Kennedy was better looking than Nixon which helped in a visual medium. Nixon had been ill and was running a fever prior to the telecast. He did not have an expert makeup man and Kennedy did. The medium of TV was the message not the content of the debate to some degree.
A short time later, I saw Marshall McLuhan on with Dick Cavett. When asked to explain how “the medium is the message” he used the Kennedy-Nixon debate as an example. He challenged the audience to objectively listen to a tape of the show and decide who won. I recently did it and he was right. (Full disclosure—I didn’t like Dick Nixon. He took too long to unwind the Vietnam War; he tried to cover up Watergate and thus almost destroyed our two party system. On August 15, 1971,he instituted wage & price controls and severed all ties to the dollar and gold which will haunt us eventually. Also, he did the shameful and un-American thing of having a White House “enemies list” while in office. But if you LISTEN to the debate, Nixon won it!)
McLuhan said that we focus on the obvious way too much. The obvious is the content but what about the subtle changes that occur due to the medium being used?
So George V told the future George VI to overcome his stammer and embrace the radio. In the 1930-1950’s that medium was the message in many cases. As we moved in to the TV age, it overshadowed content. How much have the media contributed this week to the overthrow of an Egyptian dictator? Perhaps more than the real content which is the valid complaints of an oppressed people. Now, we have a whole new array of digital entrants. The internet, You Tube, Facebook, Twitter and the next generation that may only be 24-36 months away. (Does anyone remember MySpace?)
In July of this year, had he been long lived, McLuhan would have turned 100. Well,the medium is STILL the message.
If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com
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