Category Archives: Huh?

Dunning-Kruger And You

One episode that has stayed with me for many years involved a young employee that I managed. Like most of the folks I hired, he had a lot of raw talent in the areas that you really can’t teach – excellent intellectual curiosity, a good work ethic, etc. As I saw it, my job and that of his immediate supervisor was to develop that raw talent over time.

When review time came up, he asked me when he’d get made a VP. He had been with us about 6 months and had been out of school for about 18 months. Now, most of the people who achieved VP rank were 10-15 years older than him and used those years to develop their work skills to a point that was light years past where he was. I asked him why he thought he should be made a VP and he went on about having paid his dues and that he knew as much as many of the VP’s he’d met.

He was a perfect example of something called the Dunning-Kruger effect, in which people fail to recognize their own incompetence. I see it on the golf course all the time as my playing partners will often try to hit shots that they might be able to pull off 1% of the time or they overestimate how far they actually hit the ball and come up woefully short of their target. The kid was a business example, one with which I’m sure you’re familiar.

Have you ever walked out of a meeting in which someone thought they were being brilliant while it was obvious that they really had no clue about the subject matter? The sad fact, borne out by research, is that the most incompetent individuals are the ones that are most convinced of their competence while the most competent people often underestimate their competence.  I’m a believer in knowing what you don’t know and in not assuming that just because you’re smart and very knowledgable about one subject that you can translate that into expertise in another area without doing the work to understand that area.

It’s not just stupid people who don’t know they’re stupid. Entire organizations can behave this way, believing that they can get beyond their core competency and into another business sector with equal success. Management sees that the business has a good year and deludes itself into thinking the organization is performing at peak efficiency when competitors are actually doing better and are gaining share.

We need to be on the lookout for Dunning-Kruger everywhere. For businesses, use an independent standard of measurement, hopefully, something that’s reflective of your entire industry.  As individuals, a little humility and getting outside your own bubble helps to keep your perspective. That kid didn’t make VP and in fact, ended up leaving the organization to a higher level job from which he got fired. He Dunning-Krugered himself to unemployment. I’m sure he was convinced it was due to something other than his own incompetence. You’d never make that mistake, would you?

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How Dumb Do You Think We Are?

We’ve all been lied to. It always feels bad when we discover the lie and we often get angry at the liar. A co-worker of mine had an expression that comes to mind all the time: “Forgive and remember.” It’s fine to “forget” in that holding a grudge is self-defeating. It’s better to remember (without anger if possible) so that you’re a lot warier the next time you hear something from that person.

It’s in that context that I shook my head when I read about Facebook pivoting to privacy. Now if there is one company that has violated user privacy more than Facebook I’m unaware of it. Frankly, I thought it was something that The Onion had written, but no, it was a blog post from Mark Zuckerberg.

“I believe the future of communication will increasingly shift to private, encrypted services where people can be confident what they say to each other stays secure and their messages and content won’t stick around forever”

Seriously? This is the same guy who is literally at this minute lobbying against privacy laws everywhere. This is the same company that encouraged you to give them your telephone number to use for two-factor authentication (yay privacy) and then used the phone number to target ads. Oh, and there’s no way to delete or disable that.  Then there was that time that they used an app to steal everything you did on your phone. Suckers…

Fool you once? Um, no. Back in 2010, there was a piece in the NY Times that outlined just how hard it was to make your data private on Facebook. To truly opt out of sharing all your personal information, you had to click through more than 50 privacy buttons, and then choose between more than 170 total options. There were some options that you couldn’t even opt out of at all. How dumb does he think we are?

No business can afford to lie constantly to its customers, especially one that is almost completely reliant on those customers for every bit of content. If and when users wake up, as many under 21 users of the platform have, we won’t need regulatory intervention to “fix” Facebook or any other company that lies constantly. It will just die, buried in its own untruthfulness. We’re not that dumb after all, are we?

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Servers And Small Customers

I wasted some money the other day. I thought I was being smart and using my knowledge of social media marketing to promote my franchise consulting business. I was looking to acquire some new candidates who are ready to change their lives so I created an audience of folks whose demography matched that of most of the candidates with whom I’ve been working. What I found weren’t leads but I did get a great deal of information and I want to share some of that with you today.

One truism I’ve always sworn by is that you can tell someone’s character by how they treat people who can do absolutely nothing for them. Servers, for example. Oh sure, they can bring you your order but they’re not going to help your career along. Receptionists are another example. When you treat people who you perceive to be in a subordinate role like dirt, it shows an awful lot about your personality and character.

The same holds true for how big companies treat little customers. The big guys get all the attention because they have all the dough. What’s forgotten is that the big guys were once little guys, either in sum or in their spending with you. To cultivate budget growth you need to treat every customer as if they are the most valuable.

So why the rant? My lead campaign generated several leads from Facebook. The cost per lead was substantially better than I usually have to pay to generate a lead. The problem is that when I went to download the information from Facebook I received a file that contained digital garbage. I don’t mean bad leads; I mean unreadable digital garbage. I sent a note to support to ask if I’d done something wrong. Crickets. A few days later, I sent another note which is still unanswered, not even with an autoreply letting me know that my message was received. I’m assuming that if I were one of their big customers (the Russian Internet Agency maybe?) I’d have a dedicated rep who would get back to me immediately. As a self-serve slob, I’m pretty much on my own.

Any business can learn from this. Sure, millions of small customers can’t each have a personal rep, but you’re a tech platform, dammit. Put some of those technical smarts to work and figure out how to support the little guys. If you’re not a tech platform, find one that can help you and use the reporting it will offer to make sure you’re treating the little guys the same. After all, you’re nice to the person who serves you your meal, aren’t you?

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By Any Standard

I have to admit it – I’m a sucker for the major award shows. Watching the Oscars last night made me think about some of the “awards” many companies give themselves. You can usually find them talking about them as they sell themselves. You know the drill:

    • We have world-class customer service
    • Our employee benefits are the best in our field
    • Our products are cutting-edge

And on and on. Now, having come from the sales world I’m not necessarily averse to a little hyperbole, but there is a line, one which is often crossed because there aren’t any standards. It’s an issue that affects businesses in a lot of ways, some small and some pretty egregious. It’s often the small ways – the little white lies we tell ourselves in planning or product meetings – that lead to the big ways – the hyperbole we broadcast in our marketing and set false expectations among customers, partners, vendors, and others.

Think about the differences between Consumer Reports and Amazon reviews. Consumer Reports has rigorous testing standards. It maintains editorial independence and accepts no advertising in the magazine. It buys the products it reviews and pays retail prices for them. While they’ve been sued over bad reviews they’ve never lost a case. Their reviews are objective and all products in a category are held to the same standards.

Compare that to Amazon or Yelp or Google reviews. The reviewer has no objective standards for the most part. They have no idea if common standards for a product category exist nor how to measure or apply them. The JD Power surveys try to aggregate the consumer point of view in a way that reduces personal bias which is better than pure subjective reviews. After all, who hasn’t felt like broadcasting a bad review of something to the world? Maybe the product was fine but you had a nasty experience with customer service so you trash the product as well on your review.

Many businesses do the same thing in their marketing. They don’t use objective standards and end up setting false expectations. I think many industries would do themselves a favor by objectively assessing how well individual brands meet reasonable performance expectations. I remember we used to take an annual survey of media buyers in the TV industry. On the face of it, we did a good job of assessing ourselves and our competitors objectively. The truth was many of the sales guys knew when the survey was being fielded and would wine and dine the buyers to make sure we got good reviews. Subjective standards don’t work.

How do you market yourself? Do you have enough information about your performance on an objective basis? Can you get some?

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Fending For Yourself On Facebook

We used to be awfully smug when I was working for network television. After all, if an advertiser wanted immediate national reach there were no other options. If they didn’t want to go through the hassle of buying dozens or maybe tens of dozens of individual markets in spot television, then they had to come to one of the big networks. Over time, cable TV cut into that dominance but adding a few broad reach cable networks into the mix didn’t hurt us too badly. Until it did.

Today, the audiences for network TV are big but they certainly have been bigger. More importantly, there are many others with comparable audiences and advertisers have a lot of choices. More often than not, when the channel of choice is digital, the medium of choice is Facebook. They bill themselves as a content platform but that’s not really true. They’re a publisher. They curate content from others and control the content that appears, just the way the TV networks used to do before they started creating many of the shows themselves. Slowly, they’re learning that they are responsible for the content that appears on their platform since they’re picking and choosing. Publishers (think the Times or Journal) are responsible when their publications (platforms?) are used to spread lies or infringe on copyright. There is one area, however, in which they claim no responsibility at all.

This is from an Ad Age article:

When Facebook’s Campbell Brown addressed an auditorium full of magazine executives in New York Tuesday, she did not mince words: The social network is not here to save their businesses…It was a sobering and frank message for an industry looking for answers. Facebook has endured criticism from media companies for encouraging them to invest resources into its distribution platform. Facebook has persuaded publishers to push into live video, fast-loading Instant Articles, longer Watch videos and other offerings, for example, but none have reaped significant returns.

In other words, while we encouraged you to invest in our platform and grow our engagement with audiences using your content, you’re on your own when it comes to reaping the rewards. In fact, it’s worse than that since Facebook now demands that publishers pay for any significant visibility. Facebook is in a position analogous to where we were at the TV networks 30 years ago. We didn’t realize at the time how tenuous our grasp on our audiences was nor did we do a good job of working in a balanced partnership with our advertisers. Facebook manages to piss off the marketing community almost as often as they do privacy advocates. As one analyst note said, “Facebook is at risk of being massively unfriended by its 7 million advertisers.”

Personally, I’m wondering why they have as many as they do, given their attitude to their audiences, to content providers, and to marketers. Yes, I get the numbers but I also know that there are many other choices in marketing today. Maybe the digital platforms of the TV networks? Remember them?

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Break Up Facebook

I’m a capitalist. I’m a big believer that the free enterprise system should be left to work pretty much without outside interference. We can have a lively discussion as to whether that really ever happens (I don’t think it does) but I think we can agree that where the free enterprise system needs to have some controls imposed are when the system results in anticompetitive and/or anticonsumer behavior. Historically, the government takes action at that point, as it did with Standard Oil and with original AT&T. I think we’re at that point again with Facebook and I think the company needs to be broken up.

Many of you don’t remember the old AT&T. It controlled local phones, long-distance services, and the manufacture of most telephone equipment. You can read a detailed explanation of the hows and whys of the breakup here but the net result was that phone services got more competitive, equipment improved, and the number of wireless services and broadband providers we have now is a result. AT&T was a  monopoly, and when its monopoly power was removed, it struggled.

Facebook is a monopoly. They’ve become so massive that you can’t escape their data collection system. They’ve bought any company that seems as if it might become competitive. They aren’t “winning” because they have a better product; they’re doing so because we don’t really have a choice or because they’ve cheated. Facebook bases its business model on anti-consumer behavior and, frankly, lying. They lied to publishers. They lied to video creators.  They lied to the government about data collection and the role they played in spreading misinformation and propaganda while accepting money to do so. They’ve lied to you. Think about the number of times you’ve read about some horrible thing the company has done only to promise it won’t happen again and they’ll be better. Until the next time.

Germany just did something that could show us the way. Germany’s antitrust regulator has told Facebook it must stop forcing users to allow it to collect and combine their data from sources outside Facebook. Among such sources are Facebook-owned apps like WhatsApp and Instagram as well as third-party websites that include Facebook features like the “share” button. Since Facebook derives 99% of its revenue from advertising based on that data collection, this is a great first step.

The last straw from me was the realization that Facebook is monetizing data from people who don’t even have a Facebook account. When people navigate around the internet, sites that use Facebook’s advertising pixel or other social APIs linking back to Facebook (like the “Like” button) send data about those site visits back to Facebook. Facebook collects that data on everyone who visits these sites, whether they’re a registered user or not. You might not be on Facebook but that doesn’t stop them from selling your data. It’s also why any ad-based digital publishing business is probably going to have to survive on crumbs since Facebook scarfs up most of the ad dollars since they have most of the data. Yes, I know Google grabs just as much but it’s a different business model. Search isn’t display.

Break up Facebook. The digital world needs its walls to crumble so that new businesses – better and more ethical businesses – can survive. Start by breaking off Instagram and What’s App. Don’t let them make any new acquisitions of competitors. That’s where I’d begin. You?

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The Easy Way Out For Whom?

It seems as if I’m writing a series of posts inspired by my having decided to purchase a new house. I guess when we shake up our lives a bit we get inspired, or at least we get confronted by how some businesses are a lot better than others in many ways.

Today’s tale is yet another head-shaker. One of the things I found myself needing as I planned out my new digs was a few pieces of furniture. Like many people, I took to the internet to browse online and I found things at both Wayfair and Ikea that were priced well and seemed to be of good quality. The closest Ikea store is three hours from me and Wayfair only operates online, so I did my ordering via the web.

The orders showed up pretty much on time. There was a delay in the Ikea boxes due to the fact that I wasn’t at the new house to receive them. Of course, while Ikea told me the time window in which things would arrive, they never said someone had to be there. A call to customer service and we rescheduled delivery for a few days later. If you’re telling the customer when the boxes will arrive, why not also tell them they need to be around while you have their attention? Wayfair’s deliveries were just placed on the porch without incident.

That, however, is far from the end of the tale. The real fun began after I opened the boxes. I needed to assemble the furniture and of course, the first step is to make sure all the pieces and hardware had arrived safely. They hadn’t. In two cases, one from each company, a key piece of the item was damaged and not just cosmetically. I needed replacement pieces before I could go any further.

This is where the head shaking begins. Ikea’s website says:

If you are not able to visit the store, and only one piece of the unit is damaged, call us within 365 days of the purchase with your receipt information and we will be happy to deliver the missing items within 7-10 days.

Wayfair’s policy is:

Through our online portal you can:

  • Order free replacement parts (e.g. table legs, missing screws)
  • Replace the entire item for free
  • Get in touch with Customer Service

Be sure to complete this process within 30 days of your delivery date.

No problem in either case. I contacted them and told them exactly which parts were damaged, even using the part numbers out of the assembly manuals. Want to guess what I was told? Neither company ships parts. Instead, they would ship me a complete item. I could then take the damaged part from the box and throw away or donate the rest. Huh?
These are not small items. A large bookcase from Ikea and a desk from Wayfair, each of which weighed around 100 lbs in the boxes. How is it possible it costs less to send a complete item than to have some system for having inventory replacement parts? I get that these items come pre-packaged from many manufacturers. I’m also sure these companies can track which parts of which items often show up damaged (that’s what data is for, right?). Why not order a stock of those parts instead of devastating your margins by shipping two complete items and only getting paid for one?
Many of us in business do things because it’s the easy way out. We don’t take the time to question a system that seems to be working even though it’s not optimal. When things have “always been done that way” or when a report shows up regularly and heads right to the recycling bin, we don’t ask ourselves “why” often enough. The system these two companies have doesn’t really work for anyone except the folks in the warehouse and the shipping companies. The margins are bad. The customer has to dispose of a lot of wood and packaging they don’t want or need. But I guess they think it’s working. Are you making the same mistake?

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