Category Archives: Reality checks

How Did We Get So Far Off Track?

I started working in the digital world in the mid-’90s. While I wasn’t exactly there for the dawn of the digital age, I was a relatively early member of the group of executives that began building businesses on the internet and on walled gardens like AOL used to be. A couple of things that have happened recently have me shaking my head, wondering how it’s all gone sideways.

First, I asked Twitter to send me something:

Keith Ritter, your advertiser list is ready! The list attached includes the advertisers that have included you in a tailored audience. These advertisers have included you in one or more tailored audiences. Tailored audiences are often built from email lists or browsing behaviors. They help advertisers reach prospective customers or people who have already expressed interest in their business.

I figured since I do a fair amount of cookie-blocking and other means to prevent tracking that I’d turn up in a handful of audiences and I was right. I appear in exactly 9 audiences. However, the rest of the 57-page document (not a typo) listed the similar audiences Twitter has decided I fit. They market me as a part of these audiences and I have no control over it. I can opt out and it will change the ads I see on Twitter. It won’t however, remove me from these audiences. I am included in over 1,000 of them, my data used and sold quite unwillingly.

Then there are the constantly apologizing folks at Facebook. This article in the NY Times is both frightening and disappointing. It talks about how Facebook “gave some of the world’s largest technology companies more intrusive access to users’ personal data than it has disclosed, effectively exempting those business partners from its usual privacy rules, according to internal records and interviews.”  Their privacy track record is abominable and every week it seems there is another apology and a promise to do better. Fool me once…

It’s taken years for the marketers and publishers to push back on the rampant fraud and abuse of programmatic ads. Social media is rife with “influencers” who buy fake followers and regularly violate FTC regulations on advertising. It seems that everyone under 30 is either a ninja or a guru. Fake reviews for products that are complete rip-offs are everywhere (run a link to an Amazon review through Fakespot if you don’t believe me).

All of this leaves one question: what the hell happened? How did the digital business world get so screwed up? At some point, Facebook and many other digital businesses decided that making money is way more important than serving their users is, I think, the basic answer. I’m all for making money, as my business track record shows. There are limits, however, and I have a fundamental belief that making money can only happen over the long term when you respect the customer. As the great David Ogilvy once said, “The customer is not a moron. She’s your wife.” Because most of the people who use digital have no concept about how they are tracked and marketed, most businesses treat them as morons and therein lies the problem.

I could rant on but I’ll end it here with a plea. To any of you who are in the digital world, please resolve to get back on track. Way back when in 1995, all we wanted to do was to amuse a few people and keep them engaged. Yes, we sold ads but we also didn’t track people once they left our domain. We didn’t treat them as numbers or rubes. You shouldn’t either. I get that the tools are more sophisticated and more powerful and that the world has changed. Basic business principles and human decency haven’t, have they?

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Filed under Reality checks, Huh?, What's Going On

Back To Basics

I played a number of sports growing up. Thinking back on it, no matter which sport I was playing, when the season began the coach would inevitably talk about getting back to basics. He usually meant the building block skills that a team had to have in order to be successful. If you don’t think that’s important, watch one of today’s major league baseball players try to lay down a suicide squeeze bunt. That basic skill has almost disappeared.

No, today isn’t going to be yet another old guy rant about how the world has changed for the worse, Instead, as we approach the end of one year and the start of another, it’s a reminder that now is a great time to do a little back to basics thinking. It’s harder than you think because what often happens during the course of a year (or longer, depending on when the last time was that you did this exercise) is that the basics get forgotten in the heat of battle. So here are a few of the fundamental questions that I’d be asking myself and my team right about now.

First, what are we trying to accomplish? That sounds overly simple since making a profit is pretty much what every business is trying to do unless you’re a non- or not-for-profit organization. What are you trying to make happen? What problems that your customers have are you trying to solve?

Next, how are you measuring success? It’s not just the cash register ringing or the bottom line overflowing with black ink although clearly basic financial items are important. How many new customers did you attract? How is your reputation? What good have you done for your customers, your partners, your vendors, your employees, and your community?

After that, take a look forward. What do we need to do in order to be successful in this next year? How do last year’s results, both good and bad, direct us forward? What can we start doing and what should we stop doing, whether it’s meetings, products, reports, or something else? What could happen in the marketplace that will affect us, both positively and negatively? Do we have a disaster plan?

Finally, is the view you and your organization had of the world at the start of this year still the way you see it going forward? If you don’t think that things change that much, think back 5 years or even (gulp) 10. You wouldn’t have had a mobile strategy or a social media plan then. You probably didn’t pay a heck of a lot of attention to your website or online reviews. You sure had better be active in all of those areas today even if you’re not a digital business.

Those are some of the basics I see as necessary for success. What are some of yours?

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Filed under Reality checks, Helpful Hints, Consulting

Giving Thanks Once Again

Because it’s the day before Thanksgiving here in the US, you’re getting the weekly Foodie Friday screed today. It’s a post I wrote in 2012 about another post I wrote in 2008. Many things have changed in my life and the lives of my family members since it was written. We’re more scattered geographically. We’ve had deaths and marriages. We all won’t be together this year physically but in some ways, the separation has brought us closer together.

In any event, the thinking behind this post of a post hasn’t changed. Have a great holiday wherever you and your family may be!

Several years ago I wrote a pre-Thanksgiving post on the “three f’s” of the holiday.  You may recall that I described them as:

English: Oven roasted turkey, common fare for ...

(Photo credit: Wikipedia)

  • “F” number one is Family. It’s the thing for which I am most thankful. Having them here at this holiday is a labor of love and I hope they’ll all keep showing up for many years more.
  • “F” number two is Feasting. We do ask everyone to bring something – an appetizer, wine, or a dessert, usually. Obviously, it’s not because it lightens the workload very much but because it makes them a part of the process. It’s OUR meal as a family and our shared celebration. The word “feast” comes from the same root as “festival” (yes, it’s also the same root Seinfeld used for “Festivus“) and we try to make it one. All those days of prep come together in a 45-minute orgy of eating. This holiday is very much like Christmas or Hanukah in that way – you prepare for quite a long time and then it’s over way too quickly.
  • “F” number three is Football. This is America’s national sport and we’re very much a sports-oriented group. I’ll never forget my Uncle Harry who would sit with us every year and watch the games. “I don’t understand,” he would say, “they all fall down, they all get up, they do it again. What kind of game is this?” It could be paint drying – the point is that it’s a family ritual and through it, we bond.

They haven’t changed.  Our family has been challenged this year by many of the same things that millions of other families face.  Illnesses, the economy, wacky weather, and the other day-to-day events that keep it…interesting…  Even so, we’re very fortunate and tomorrow will be a day to remember that.  If anything, the adversity has pulled us even closer.

I’m very thankful, among other things, for those of you that take the time to read the screed every once in a while.  I appreciate your comments when I hit home and even more so when I miss the mark.  Have a great holiday!

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Filed under food, Reality checks

How About A Bowl Of Sugar?

Foodie Friday, and this week I’m revved up about a food issue which also raises an issue with every business. You are probably aware that there is an epidemic of diabetes in this country. According to the Centers For Disease Control, 1 in 3 adults in this country has pre-diabetes (elevated blood sugar) and over 9% actually have the disease. This incidence is much higher here in the South with some states having well over 11% of the population affected. Having spent a few years here I can tell you that there is a lot of sweet tea and other sugar-added foods sold everywhere.

What’s got me off on this rant today is what I would call yet another nail in the coffin of those who will contract the disease. Apparently, some genius at Post Cereals felt it would be a good idea to make a cereal named after Sour Patch Kids, a candy. I guess we can commend them for dropping all pretense for most breakfast cereals being anything other than candy and just calling it what it is. You think I’m hyperbolizing? You can literally pour a bowl of some breakfast cereals and half of what you pour is pure sugar. Golden Crips cereal (called Sugar Crisp when I was a kid) is almost 52% sugar. Honey Smacks (formerly Sugar Smacks) is over 55%. You would be better off feeding your kid a Snickers bar – it’s only 45% sugar.

There is a greater question here for anyone in business. Post isn’t the only company doing this. General Mills sells cereal with Reese’s Peanut Butter Cups on the front. I refuse to believe that the folks at Post or General Mills don’t have an understanding that what they’re selling is fostering an epidemic. It’s easy for them to shrug their shoulders and say “well, responsible parents will let their kids eat this only in moderation.” So why change the names of the aforementioned cereals to delete “sugar? Why isn’t the nutritional information for Reese’s Puffs on the General Mills website? These are dangerous products, folks, and they raise the greater business question. Should we make products that we know are doing great harm? Just because we can do something, should we? Isn’t it possible to sell the healthier alternatives you already make to kids and stop pushing something that you know puts these kids on the road to diabetes?

It doesn’t have to be that way. When scientists discovered a hole in the ozone layer and attributed it to the use of CFC’s, many companies that used CFC’s as the propellant in their spray products changed to something else. The products are less dangerous and the hole is healing. Having a conscience to go along with having a bottom line isn’t inconsistent nor bad business. It’s quite the opposite. Selling kids bowls of sugar under the guise of “making your day better” really is a sad way to make a buck, don’t you think?

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Filed under food, Huh?, Reality checks, Thinking Aloud

He’s Due

The World Series just concluded. Congratulations, Red Sox fans and boy, how it pains me to say that as a life-long Yankees fan. Watching baseball reminded me of something we used to say back when I played baseball. When a guy was in a hitting slump we’d often say “he’s due.” What we meant was that according to his batting average he had taken enough at-bats that it was time for a hit. After all, if his average shows he gets 3 hits every 10 times at bat and he hadn’t had a hit in 15 plate appearances, statistically he should get one now. We were convinced he was due.

That, dear readers, was our youthful display of The Gambler’s Fallacy. We were laboring under the misconception that what has recently occurred will affect what occurs next even if the two events are unrelated. For example, if flipping a coin nine times results in nine instances of “heads,” you might think “tails” is due. Sorry – probability still applies and there’s a 50 percent chance the tenth flip will be heads regardless of what has happened before.

Stop and think about how often you or someone you know in business makes the mistake that if something happens more frequently than normal during a given period, it will happen less frequently in the future (or vice versa). Salespeople refuse to accept higher quotas after a good year, holding back revenue projections which holds back hiring and spending which results in a missed opportunity.  Marketers keep spending against historically good targets after a few campaigns don’t result in the expected results rather than acknowledging that the market may have shifted. Financial people let their insurance lapse after a disaster figuring that if they had a hurricane hit in their area which rarely gets hurricanes, the likelihood of another one hitting is very low. As someone pointed out, the term “100-year flood” doesn’t mean a flood happens every hundred years; it means there is a 1% chance of it hitting during ANY year.

The odds of a disaster happening might be very low but we buy insurance and, more importantly, we make disaster plans. The failure to hit a revenue target after three bad quarters doesn’t mean “you’re due” to have a huge fourth quarter. It means you need to make adjustments. There is no question that luck plays some role in business success and failure but that’s not a business plan.

In the great baseball movie “Major League”, the manager brings in a pitcher to face a batter that has gotten many hits off of him in the past. When the catcher questions his choice, the manager says “I know he hasn’t done very well against this guy but I got a hunch he’s due.” That might be how you want to run your baseball team but it is NOT the way you want to run your business. It worked out in the movies but that’s not real life.

Make sense?

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Filed under Reality checks, Consulting

Ethics And Profits

A bit of a rant today. Suppose you had a friend who lied about things. Maybe they told you that they had a great way to help your business when, in fact, their plan was to use your money to build up their own business. Maybe you gave them money to invest and they lied about the returns. Maybe you tell them information about yourself that you don’t really want public and they tell people anyway. Maybe you let them use your phone or your computer for a few minutes and they installed malware that spied on your constantly. Some friend, right?

Welcome to doing business with Facebook.

Now before you accuse me of hyperbole, let me remind you of the incredible breaches of trust that Facebook has committed over the years. If you look up “Facebook apologizes,” you get over 17 million results. They, like many companies, seem to be focused on one thing: shareholders. As one person put it in speaking about the fall of Sears:

“What’s happened is that shareholders’ interests have squeezed out other stakeholders,” said Arthur C. Martinez, who ran Sears during the 1990s and was credited with a turnaround. “The mantra is shareholders above all else.”

What happens to workers doesn’t matter. Amazon gave raises with one hand and took away stock grants with the other. What happens to partners doesn’t matter. Facebook begged marketers to use their platform to distribute content and then, once the platform had grown to an unimaginable size, cut off marketers who didn’t pay them from access to their audience. What happens to users doesn’t matter. Alphabet, Google’s parent, has over 88% of mobile apps gathering data for them whether users know it or not. Ever wonder how the ads Google serves you with a search seem to tie to something you were doing on a news or productivity app that had nothing to do with Google or search or even ads? Here’s a study that will explain it.

Why is it so hard to follow a moral compass to profitability for many companies? If the bulk of non-tech people truly understood how their data is gathered and used, they’d go back to flip phones. Why not put your customers first and treat them as you’d expect to be treated as a customer? Why not reward employees so that they’re doing better as you’re doing better? Why not put partners’ interests on a level footing with your own so that deals are equitable and profitable for you both? Why not allow vendors to make an honest profit? Without those four things – customers, employees, partners, and vendors – what the shareholders have will be worthless pieces of paper and not an interest in a profitable, growing enterprise.

My friends don’t lie to me and I don’t lie to them. We’ve had our share of messy moments because of that but we’re still friends because of that honesty. We need ethical standards in business every bit as much as we need profits; probably more so. OK, rant over, but do me a favor and think about that, won’t you?

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By The Numbers

Foodie Friday at last! I went out for breakfast this morning and as I watched my server typing my order into the Point Of Sale system, I wondered what was coming out the other end. No, not if my order had been captured correctly or if the ticket would print out correctly. I wondered if the owners of the place actually used the data that had just been gathered. Restaurants generate a phenomenal amount of data although I’d be willing to wager that a minority of them actually look at, analyze, and employ it to improve their business. Then again, I’d be willing to bet that many non-food businesses suffer from the same omission.

Think about it. A restaurant gets information from their POS system – what’s selling and how much does it cost. They see if something is more popular at lunch than at dinner. They can look at their reservation system to know when they’ll be busy and their seating record to know how many covers they’re selling. Smart ones look at how many parties of which size were kept waiting (maybe we should turn the 6-top into a 4- and a 2?). They know what drinks have been ordered. Their suppliers have data for them – what’s available and what does it cost? Then they have their own internal accounting – labor costs, etc. Each of those things relates to the other. But there’s more.

What’s posted on social media? Whats the most-photographed dish? What’s liked and shared? How many reviews and are they positive? What are they about? There’s a lot of data to collect from a multitude of sources – OpenTable, Facebook, Twitter, Yelp, TripAdvisor, Foursquare, Urbanspoon or Instagram. All of the former data is very structured and it tells you “what.” The social stuff, along with any loyalty data you might have is unstructured and it can help you to understand “why”.

Maybe if you overlay the daily weather during service hours you can infer a causal effect on any of the above. You can adjust what’s displaying on your drive-thru board when it’s busy to show the menu items that may be lower-margin but quicker to prepare in order to speed the line. If you collect emails (your reservation system does!), you can use Facebook or some other data provider to build out profiles so you can know your customer and better target your marketing.

My point is that every business has a similar capability these days. We might not have reservation systems but we do have online commerce or websites or apps. We need to be less intimidated by big data and more proactive with respect to learning about our customers and how they interact with our offerings. Does that make sense?

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