At this volume, and with the impermanence of the sandwich, it only makes sense for McDonald’s to treat the sandwich as a sort of arbitrage strategy: at both ends of the product pipeline, you have a good being traded at such large volume that we might as well forget that one end of the pipeline is hogs and corn and the other end is a sandwich. McDonald’s likely doesn’t think in these terms, and neither should you.
Oh and speaking of pipelines:
And for its part, the McRib makes a mockery of this whole terribly labor-intensive system of barbecue, turning it into a capital-intensive one. The patty is assembled by machinery probably babysat by some lone sadsack, and it is shipped to distribution centers by black-beauty-addicted truckers, to be shipped again to franchises by different truckers, to be assembled at the point of sale by someone who McDonald’s corporate hopes can soon be replaced by a robot, and paid for using some form of electronic payment that will eventually render the cashier obsolete.
There is no skilled labor involved anywhere along the McRib’s Dickensian journey from hog to tray, and certainly no regional variety, except for the binary sort — Yes, the McRib is available/No, it is not — that McDonald’s uses to promote the product. And while it hasn’t replaced barbecue, it does make a mockery of it.
More than a year ago, Facebook engineer Andrew Bosworth wrote a post about how best to work with Facebook CEO Mark Zuckerberg.
I think one of the biggest mistakes people make when first working with Zuck is feeling that they can’t push back. As long as I have been at Facebook, I have been impressed with how much he prefers to be part of an ongoing discussion about the product as opposed to being its dictator. There are a number of exceptions to this, of course, but that comes with the territory. In those instances where he is quite sure what he wants, I find he is quite good at making his decisions clear and curtailing unneeded debate.
Barring that, you should feel comfortable noting potential problems with a proposal of his or, even better, suggesting alternative solutions. You shouldn’t necessarily expect to change his mind on the spot, but I find it is common for discussions to affect his thinking over a longer time period. Don’t necessarily expect acknowledgment for your role in moving the discussion forward; getting the product right should be its own reward. If you do that, you’ll find you are invited back more and more to the debate.
Facebook is certainly an interesting company…they’re a large company that appears to operate much like a small company. Will be interesting to see if they can keep that up as they get larger, go public, etc.
I’d never heard the story of how Richard Branson started Virgin Atlantic…interesting story.
In ‘79, when Joan, my fiancee and I were on a holiday in the British Virgin Islands, we were trying to catch a flight to Puerto Rico; but the local Puerto Rican scheduled flight was cancelled. The airport terminal was full of stranded passengers. I made a few calls to charter companies and agreed to charter a plane for $2000 to Puerto Rico. Cheekily leaving out Joan’s and my name, I divided the price by the remaining number of passengers, borrowed a blackboard and wrote: VIRGIN AIRWAYS: $39 for a single flight to Puerto Rico.
An analysis by complex systems theorists at the Swiss Federal Institute of Technology reveals that a “super-entity” of just 147 companies that controls 40% of the wealth among the world’s transnational corporations. And even worse is how tightly integrated these companies are…large pieces tightly coupled is a recipe for economic disaster.
John Driffill of the University of London, a macroeconomics expert, says the value of the analysis is not just to see if a small number of people controls the global economy, but rather its insights into economic stability.
Concentration of power is not good or bad in itself, says the Zurich team, but the core’s tight interconnections could be. As the world learned in 2008, such networks are unstable. “If one [company] suffers distress,” says Glattfelder, “this propagates.”
“It’s disconcerting to see how connected things really are,” agrees George Sugihara of the Scripps Institution of Oceanography in La Jolla, California, a complex systems expert who has advised Deutsche Bank.
Here’s the idea they came up with: Americans themselves would start lending to small businesses, with Starbucks serving as the middleman. Starbucks would find financial institutions willing to loan to small businesses. Starbucks customers would be able to donate money to the effort when they bought their coffee. Those who gave $5 or more would get a red-white-and-blue wristband, which Schultz labeled “Indivisible.” “We are hoping it will bring back pride in the American dream,” he says. The tag line will read: “Americans Helping Americans.”
This should be a bigger story, shouldn’t it? Banks seem less and less interested in lending money to people as their primary business and things like Kickstarter and this Starbucks initiative are taking their place.
A common reaction to Apple’s announcement of the iPhone 4S yesterday was disappointment…Mat Honan’s post at Gizmodo for instance.
I was hoping for something bold and interesting looking. The iPhone 4 was just that when it shipped. So too were the original iPhone and the iPhone 3G. If I’m going to buy a new phone, of course I want it to look new. Because of course we care about having novel designs. If we didn’t we’d all be lugging around some 10-inch thick brick with a 12 day battery life.
Mat’s is an understandable reaction. After I upgraded my iPhone, Macbook Pro, and OS X all at once two years ago, I wrote about Apple’s upgrade problem:
From a superficial perspective, my old MBP and new MBP felt exactly the same…same OS, same desktop wallpaper, same Dock, all my same files in their same folders, etc. Same deal with the iPhone except moreso…the iPhone is almost entirely software and that was nearly identical. And re: Snow Leopard, I haven’t noticed any changes at all aside from the aforementioned absent plug-ins.
So, just having paid thousands of dollars for new hardware and software, I have what feels like my same old stuff.
Deep down, when I stop to think about it, I know (or have otherwise convinced myself) that these purchases were worth it and that Apple’s ease of upgrade works almost exactly how it should. But my gut tells me that I’ve been ripped off. The “newness” cognitive jolt humans get is almost entirely absent.
For me, yesterday’s event, Apple’s continued success in innovation *and* business, and the recent CEO change provided a different perspective: that Apple makes two very complementary types of products and we should be excited about both types.
The first type of product is the most familiar and is exemplified by Steve Jobs: Apple makes magical products that shape entire industries and modify social structures in significant ways. These are the bold strokes that combine technology with design in a way that’s almost artistic: Apple II, Macintosh, iPod, iPhone, and iPad. When they were introduced, these products were new and exciting and no one quite knew where those products were going to take us (Apple included). That’s what people want to see when they go to Apple events: Steve Jobs holding up a rainbow-hued unicorn that you can purchase for your very own.
The second type of product is less noticed and perhaps is best exemplified by Apple’s new CEO, Tim Cook: identify products and services that work, continually refine them, innovate at the margins (the addition of Siri to the iPhone 4S is a good example of this), build interconnecting ecosystems around them, and put processes and infrastructure in place to produce ever more of these items at lower cost and higher profit. The wheel has been invented; now we’ll perfect it. This is where Apple is at with the iPhone now, a conceptually solved problem: people know what they are, what they’re used for, and Apple’s gonna knuckle down and crank out ever better/faster/smarter versions of them in the future. Many of Apple’s current products are like this, better than they have ever been, more popular than they have ever been, but there’s nothing magical about them anymore: iPhone 4S, iPod, OS X, iMacs, Macbooks, etc.
The exciting thing about this second type of product, for investors and consumers alike, is Apple is now expert at capturing their lightning in a bottle. ‘Twas not always so…Apple wasn’t able to properly capitalize on the success of the Macintosh and it almost killed the company. What Tim Cook ultimately held up at Apple’s event yesterday is a promise: there won’t be a return to the Apple of the 1990s, when the mighty Macintosh devolved into a flaky, slow, and (adding insult to injury) expensive klunker and they couldn’t decide on a future direction for their operating system (remember Copland?). There will be an iPhone 5 in the future and it will be better than the iPhone 4S in significant & meaningful ways but it will also *just work*. And while that might be a bit boring to Apple event watchers, this interconnected web of products is the thing that makes the continued development of the new and magical products possible.
New Tumblr: Things Apple is Worth More Than. Such as: the GDP of Singapore, every single home in Atlanta, Georgia, and all the illegal drugs in the world.
Qwikster will rent you DVDs and Netflix will rent you streaming movies. Two separate sites/companies, no interop, you have to sub to both separately, etc. Here’s the explanation from Netflix CEO Reed Hastings. This seems amazingly dumb at first blush. (ps. Qwikster?!!)
Netflix’s holy grail is to get each person, not each household, to have a separate streaming subscription, the way everyone also has a separate Facebook account. Separating a per-household service like DVD rentals-by-mail helps simplify that eventual transition.
Speaking of fruit, you may think a banana is just a banana, but it’s not. Dole and other banana growers have turned the creation of a banana into a science, in part to manipulate perceptions of freshness. In fact, they’ve issued a banana guide to greengrocers, illustrating the various color stages a banana can attain during its life cycle. Each color represents the sales potential for the banana in question. For example, sales records show that bananas with Pantone color 13-0858 (otherwise known as Vibrant Yellow) are less likely to sell than bananas with Pantone color 12-0752 (also called Buttercup), which is one grade warmer, visually, and seems to imply a riper, fresher fruit. Companies like Dole have analyzed the sales effects of all varieties of color and, as a result, plant their crops under conditions most ideal to creating the right ‘color.’
TO SEE how profoundly the book business is changing, watch the shelves. Next month IKEA will introduce a new, deeper version of its ubiquitous “BILLY” bookcase. The flat-pack furniture giant is already promoting glass doors for its bookshelves. The firm reckons customers will increasingly use them for ornaments, tchotchkes and the odd coffee-table tome-anything, that is, except books that are actually read.
In the first five months of this year sales of consumer e-books in America overtook those from adult hardback books. Just a year earlier hardbacks had been worth more than three times as much as e-books, according to the Association of American Publishers. Amazon now sells more copies of e-books than paper books. The drift to digits will speed up as bookshops close. Borders, once a retail behemoth, is liquidating all of its American stores.
By 1941, The advertising agency reported to [De Beers] that it had already achieved impressive results in its campaign. The sale of diamonds had increased by 55 percent in the United States since 1938, reversing the previous downward trend in retail sales. N. W. Ayer noted also that its campaign had required “the conception of a new form of advertising which has been widely imitated ever since. There was no direct sale to be made. There was no brand name to be impressed on the public mind. There was simply an idea — the eternal emotional value surrounding the diamond.” It further claimed that “a new type of art was devised … and a new color, diamond blue, was created and used in these campaigns…. “
In its 1947 strategy plan, the advertising agency strongly emphasized a psychological approach. “We are dealing with a problem in mass psychology. We seek to … strengthen the tradition of the diamond engagement ring — to make it a psychological necessity capable of competing successfully at the retail level with utility goods and services….” It defined as its target audience “some 70 million people 15 years and over whose opinion we hope to influence in support of our objectives.” N. W. Ayer outlined a subtle program that included arranging for lecturers to visit high schools across the country. “All of these lectures revolve around the diamond engagement ring, and are reaching thousands of girls in their assemblies, classes and informal meetings in our leading educational institutions,” the agency explained in a memorandum to De Beers. The agency had organized, in 1946, a weekly service called “Hollywood Personalities,” which provided 125 leading newspapers with descriptions of the diamonds worn by movie stars. And it continued its efforts to encourage news coverage of celebrities displaying diamond rings as symbols of romantic involvement. In 1947, the agency commissioned a series of portraits of “engaged socialites.” The idea was to create prestigious “role models” for the poorer middle-class wage-earners. The advertising agency explained, in its 1948 strategy paper, “We spread the word of diamonds worn by stars of screen and stage, by wives and daughters of political leaders, by any woman who can make the grocer’s wife and the mechanic’s sweetheart say ‘I wish I had what she has.’”
It’s fascinating to watch the advertising beast change its tactics as the diamond monopoly’s needs shift with new supply, new markets, and unexpected success.
There’s been a lot written about Steve Jobs in the past week, a lot of it worthy of reading, but one piece you probably didn’t see is David Galbraith’s piece on Jobs’ similarity to architect Norman Foster. The essay is a bit all over the place, which replicates the experience of talking to David in person, but it’s littered with insight and goodness (ditto).
The answer is what might be called the sand pile model and it operated at Apple and Fosters, the boss sits independently from the structural hierarchy, to some extent, and can descend at random on a specific element at will. The boss maintains control of the overall house style by cleaning up the edges at the same time as having a vision for the whole, like trying to maintain a sand pile by scooping up the bits that fall off as it erodes in the wind. This is the hidden secret of design firms or prolific artists, the ones where journalists or historians agonize whether a change in design means some new direction when it just means that there was a slip up in maintaining the sand pile.
And I love this paragraph, which integrates Foster, Jobs, the Soviet Union, Porsche, Andy Warhol, Lady Gaga, and even an unspoken Coca-Cola into an extended analogy:
Perfecting the model of selling design that is compatible with big business, Foster simultaneously grew one of the largest architecture practices in the world while still winning awards for design excellence. The secret was to design buildings like the limited edition, invite only Porsches that Foster drove and fellow Porsche drivers would commission them. Jobs went further, however, he managed to create products that were designed like Porsches and made them available to everyone, via High Tech that transcended stylistic elements. An Apple product really was high technology and its form followed function, it went beyond the Porsche analogy by being truly fit for purpose in a way that a Porsche couldn’t, being a car designed for a speed that you weren’t allowed to drive. Silicon Valley capitalism had arguably delivered what the Soviets had dreamed of and failed, modernism for the masses. An iPhone really is the best phone you can buy at any price. To paraphrase Andy Warhol: Lady Gaga uses an iPhone, and just think, you can have an iPhone too. An iPhone is an iPhone and no amount of money can get you a better phone. This was what American modernism was about.
And as usual, the definitive review of any new version of OS X is John Siracusa’s for Ars Technica. This time around, it runs 19 pages. If that’s not to your liking, you can just download Lion right now from the Mac App Store for $30.
Two other misc Apple thoughts: 1) They appear to have discontinued the MacBook. There are Airs and Pros but no plain-old MacBooks. 2) Apple Inc, already among the largest companies in the world in terms of market cap, announced yesterday that the company’s “revenue [is] up 82 percent and profits [are] up 125 percent” over the same quarter last year. That level of growth in such a big company…that’s just astounding. And much of the revenue and profit are from products that didn’t exist even five years ago…the iPad alone was a ~$5 billion business in Q3 (for comparison, Google had $9 billion in total revenues in Q2). If that’s not unprecedented, it’s damn close.
From 1990, a NY Times article on a new factory built by Next, the company Steve Jobs started after he left Apple. The more you learn about Next, the more you realize just how much Next DNA there is in the current incarnation of Apple. The story of Apple’s second coming could easily be written as the triumph of Next. This section from the middle of the article articulates perfectly Apple’s current approach to manufacturing:
Indeed, critics of Mr. Jobs, who is 35 years old, say he is wasting his money by building a factory at this point. With the small number of machines he is building today, it would have been cheaper simply to contract with other companies to assemble the computers, they say.
But Dr. Piszczalski said the initial high investment in an automated factory may permit Next more control of its expenses while volumes are low.
And backers of Mr. Jobs note that he has a long-term strategy in which manufacturing makes sense. “Steve will be in business for the long pull,” said H. Ross Perot, one of Next’s investors. “He’s not in business for six months.”
Next’s products have yet to gain a significant share of the marketplace, but Mr. Jobs, who has a reputation for painstaking attention to detail and a passion for the importance of manufacturing, argues that by linking this flexible factory more closely than ever to Next’s research and development process, his company can gain a strategic advantage in the industry that will eventually pay off in larger sales.
In Mr. Jobs’s view, the factory testifies to the fact that the United States can still compete as both a low-cost and a world-class manufacturer when it sets its mind to the task.
Mr. Jobs said he modeled the factory after those of Japanese corporations like the Sony Corporation that have perfected a design-for-manufacturing strategy that transforms the factory floor into an extension of the company research and development center.
Update: Next made a documentary on how computers are made at the new factory.
That’s got to be a Hans Zimmer soundtrack, yes? (via @mgrdcm)
UBS: If we were playing Russian roulette and had one bullet, I randomly spun the chamber and fired but nothing was fired. Would you rather fire the gun again or respin the chamber and then fire on your turn?
I’d rather get the fuck out of your office and run away very fast. What the hell are you people on? Haven’t you heard of email? Or official dispute procedures? Jesus.
Based on his answer to P&G’s “sell me an invisible pen”, I’d hire Turnbull in a second if I were selling invisible pens.
We get a much clearer picture of the real standing of countries if we consider economic growth and GDP per capita. Western Europe GDP per capita was higher than that of both China and India by 1500; by 1600 it was 50% higher than China’s. From there, the gap kept growing. Between 1350 and 1950 — six hundred years — GDP per capita remained roughly constant in India and China (hovering around $600 for China and $550 for India). In the same period, Western European GDP per capita went from $662 to $4,594, a 594 percent increase.
But in the future, corporations will find it more difficult to achieve such easy growth:
Attention behaves the same way. Take an average housewife, the target of much time mining early in the 20th century. It was clear where her attention was directed. Laundry, cooking, walking to the well for water, cleaning, were all obvious attention sinks. Washing machines, kitchen appliances, plumbing and vacuum cleaners helped free up a lot of that attention, which was then immediately directed (as corporate-captive attention) to magazines and television.
But as you find and capture most of the wild attention, new pockets of attention become harder to find. Worse, you now have to cannibalize your own previous uses of captive attention. Time for TV must be stolen from magazines and newspapers. Time for specialized entertainment must be stolen from time devoted to generalized entertainment.
[…]
Each new pocket of attention is harder to find: maybe your product needs to steal attention from that one TV obscure show watched by just 3% of the population between 11:30 and 12:30 AM. The next displacement will fragment the attention even more. When found, each new pocket is less valuable. There is a lot more money to be made in replacing hand-washing time with washing-machine plus magazine time, than there is to be found in replacing one hour of TV with a different hour of TV.
Groupon has filed its S-1 and hopes to raise $750M in its initial public offering. Given they’re currently losing a staggering $117M per quarter, despite revenues of $644M, they’ll be burning through that cash almost as soon as it hits their account.
At the moment, it’s costing them $1.43 to make $1, and it doesn’t look like it’s getting any cheaper. They’re already projected to make close to three billion dollars in revenues this year. If you can’t figure out how to make money on three billion in revenue, when exactly will the profit magic be found? Ten billion? Fifty billion?
I feel like the Groupon IPO is an elaborate practical joke.
It was a different time and (as DHH notes) a different company, but when Amazon IPOed in 1997, they lost $27.6 million that year on net sales of $147.8 million. That’s an 18% loss for Amazon compared to Groupon’s, hey, 18% loss. Amazon didn’t report their first profit until Q4 2001. No guarantee whether Groupon will ever turn a profit but something to consider anyway. Oh, and probably not relevant but interesting nonetheless: Amazon CEO Jeff Bezos is an investor in DHH’s company, 37signals…and until recently, 37signals co-founder Jason Fried was on Groupon’s board of directors.
My situation is blessed and I rarely let a day go by that I don’t say a silent prayer in thanks for the position in which I’ve found myself, but good gracious is this hard.
The most frustrating part is that it is difficult to get into a rhythm in your work when you have no real understanding of the next steps you need to take. There’s no opportunity for flow if both outcome and process are foreign experiences. There’s just a lot of poking around and mystery and inadvertent negligence.
Svpply has been open to the public for six months now. Our progress has been slow for a variety of reasons. We have not launched as many new features as I would expect, or even drastically improved the ones we launched with. I own these problems, they can be traced directly back to my inabilities and inexperience, sometimes directly, other times in the form of my not having anticipated or recognized situations for what they were as soon as I could have.
James Somers noticed that his equity derivative-trading roommate was the only one of his young professional friends who comes home from work “buoyant and satisfied”, so he accompanied him to work one day to see what his job entailed. Turns out he basically plays video games all day.
A trader’s job is to be smarter than the market. He converts a mess of analysis and intuition into simple bets. He makes moves. If his predictions are better than everyone else’s, he wins money; if not, he loses it. At every moment he has a crystalline picture of his bottom line, the “P and L” (profit and loss) that determines how much of a bonus he’ll get and, more importantly, where he stands among his peers. As my friend put it, traders are “very, very, very competitive.” At the end of the day they ask each other “how did you do today?” Trading is one of the few jobs with an actual leaderboard, which, if you’ve ever been on one, or strived to get there, you’ll recognize as being perhaps the single most powerful driver of a gamer’s engagement.
That seems to be the core of it, but no doubt there are other game-like features in play here: the importance of timing and tactile dexterity; the clear presence of two abstract levels of attention and activity, one long-term and strategic, the other fiercely tactical, localized in bursts a minute or two long; the need for teams and ceaseless chatter; and so on.
Athleticism and competitiveness are often downplayed when we talk about white collar careers but are essential in many disciplines. Doctors (surgeons in particular) have both those traits, founding a startup company is definitely competitive and can be as physically demanding as running, teachers are standing or walking all day long, and even something like programming requires manual dexterity with the mouse & keyboard and the stamina to sit in a chair paying single-minded attention to a task for 10-12 hours a day. (via @tcarmody)
Why has Yahoo! chosen to transition Delicious to AVOS? While we love Delicious (and our users love Delicious), we wanted to find a home for the product where it can receive more love and attention. We think AVOS is that place.
When will AVOS officially start running Delicious? We anticipate Delicious in its current form will be available until approximately July 2011. By agreeing to AVOS’s terms of service upfront, you will allow us to move your data when the time comes to transfer control to AVOS.
In the near term, companies making iPhone and iPad competitors are never going to beat Apple at their own game. Apple has supply chain advantages, a massive number of their customers’ credit card numbers (why do you think Jobs brings this up at every single Apple event…it’s important!), key patents, one-in-lifetime personnel like Steve Jobs and Jony Ive, solid relationships with key media companies, and an integrated ecosystem of stores, apps, applications, and hardware. They are an imposing competitor.
But Apple also has some weak spots which a canny competitor should be able to exploit to make compelling products that Apple won’t be able to duplicate or directly compete with.
1. Apple doesn’t do social well on a large scale. Ping? Game Center? Please. Social applications don’t seem to be in Apple’s DNA…their best applications are still single-player or 2/3/4-player. Someone should figure out how to leverage Facebook’s social graph to make the phone/app/gaming/music/video experience significantly better than on the iPhone/iPad and then partner exclusively with Facebook to make it happen. The Facebook Fone would be a massive hit if done right.
2. Apple can’t do the cloud either. Mobile Me has been around since January 2000 (when it was called iTools) and the service is still not as compelling as newcomer Dropbox. iPods, iPhones, and iPads are still very much tethered to plain-old desktop/laptop computers and iTunes…there’s an opportunity here for a better way.
3. iTunes is getting long in the tooth. The cloud and social are the two Apple weaknesses, but iTunes is showing its age and over the years has become a bloated collection of functionalities…music store, video store, app store, mobile device manager, “social” network, and, oh, by the way, you can also use it to play your music. Spotify, Pandora, and Rd.io point the way to a different approach.
4. I can’t remember if this is my own theory or I read about this on Daring Fireball or something, but the Apple products & services that Apple does well are the ones that Steve Jobs uses (or cares about) and the ones he doesn’t use/care about are less good (or just plain bad). Jobs uses Keynote and it’s very good…but I’m pretty sure Jobs never has had to schedule his own appointments with iCal so that program is less good. Cloud apps and social apps are at the top of this list for a reason…I just don’t think Jobs cares about those things. I mean, he cares, but there’s not a lot of passion there…they aren’t a priority for him so he doesn’t really know how to think about them and attack those problems.
And then there are a couple of Apple weaknesses that actually aren’t weaknesses at all:
1. Price. Everyone still thinks that Apple products are expensive, or, more to the point, overpriced. But no one else has made a compelling tablet for under $500 yet. And if you attack Apple on price, potential gothchas lurk: Apple is absurdly profitable and cash-rich; if they feel the need to compete with anyone on price in order to protect their business interests, they can do so with price cuts deep enough and long enough to drive most potential competitors out of business.
2. Openness and secrecy. Competitors should take a page from Apple’s playbook here and be open about stuff that will give you a competitive advantage and shut the hell up about everything else. Open is not always better.
Business Insider has a pair of articles about what they say is the real story about the founding of Twitter. The first is a general outline of the unofficial history of the company versus what you generally hear from the company and its founders.
Glass insists that he is not Twitter’s sole founder or anything like it. But he feels betrayed that his role has basically been expunged from Twitter history. He says Florian Webber doesn’t get enough credit, either.
“Some people have gotten credit, some people haven’t. The reality is it was a group effort. I didn’t create Twitter on my own. It came out of conversations.”
“I do know that without me, Twitter wouldn’t exist. In a huge way.”
The second is an interview with Noah Glass, who many people who were there at the beginning of the service consider one of the true cofounders of Twitter.
Jack [Dorsey] was someone who was one of the stars of the company and I got the impression he was unhappy with what he was working on. He was doing a lot of cleanup work on Odeo. He and I had become pretty close friends and were spending time together.
He started talking to me about this idea of status and how he was really interested in status. He developed this bicycle messenger status system in the past. I was trying to figure out what it was he found compelling about it. At the same time, we were looking at ‘groups’ models and how groups were formed and put a couple things together to look at this idea of status and to look at this idea of grouping and it sort of hit me - the idea for this product. This thing that would be called Twitter, what it would look like. This ad hoc grouping mechanism with non-realtime status updates all based on mobile phones.
There was a moment when I was sitting with Jack and I said, “Oh, I do see how this could really come together to make something really compelling.” We were sitting on Mission St. in the car in the rain. We were going out and I was dropping him off and having this conversation. There was a moment where it all fit together for me.
We went back to Odeo and put together a team. A very separate working team, mostly it was myself, Jack, and Florian [Webber], a contractor. [Florian] was working from Germany at the time.
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Jason Fried reveals how he got good at making money. I am not a full-fledged member of the Church of 37signals, but one of my favorite lessons from them is that a business needs to practice how to make money in order to get good at it…it’s not something that you just turn on when monetizing mode strikes.
So here’s a great way to practice making money: Buy and sell the same thing over and over on Craigslist or eBay. Seriously.
Go buy something on Craigslist or eBay. Find something that’s a bit of a commodity, so you know there’s always plenty of supply and demand. An iPod is a good test. Buy it, and then immediately resell it. Then buy it again. Each time, try selling it for more than you paid for it. See how far you can push it. See how much profit you can make off 10 transactions.
Start tweaking the headline. Then start fiddling with the product description. Vary the photographs. Take some pictures of the thing for sale; use other photos with other items, or people, in them. Shoot really high-quality shots, and also post crappy ones from your cell-phone camera. Try every variation you can think of.
Here’s how you do it well, courtesy of Zappos (of course). Yesterday I tweeted:
I think my wife is having an affair with someone named “Zappos”. He sends her a package at least every third day. I am on to you, Mr Zappos!
Almost immediately, Zappos’ customer service Twitter account replied:
@jkottke I’m sorry sir, but our relationship with your wife is strictly professional.
Great, right? A company that gets the joke and participates meaningfully in an actual conversation with a full awareness of the context.
Here’s how not to do it, courtesy of United Airlines. Mena Trott, a co-founder of Six Apart, had her flight to NYC randomly cancelled on Monday night by “a robot”. (They actually blamed it on a robot!) In a series of threetweets, Mena voiced her displeasure:
Thanks @unitedairlines for randomly canceling my miles booked ticket for tonight, taking the miles & not letting me rebook for lack of miles
And then hanging up on me after I waited for an hour! I hate you @unitedairlines
Apparently the automated voice recognition system can’t tell what I’m saying through my tears @unitedairlines #IhateYouSoMuch
Reply from @unitedairlines? Nothing. But then while on her rebooked flight the next morning, Mena tweets sarcastically:
Thanks to @unitedairlines I can finally watch that Frasier episode I missed in 1994.
And unbelievably, @unitedairlines replied, pouring burning acid into Mena’s obviously still-tender wound:
@dollarshort “…I hear the blues a-callin’, Tossed salad and scrambled eggs..”
That is some serious customer service tone deafness right there. It would be easy to blame whatever social media jockey they’ve got manning the Twitter account for the faux pas, but obviously United customer communication problems run deeper (and originate higher up the pay scale) than that.
Totally depressing article about how Hollywood movies suck worse than ever and “the potential death of the great American art form”.
For the studios, a good new idea has become just too scary a road to travel. Inception, they will tell you, is an exceptional movie. And movies that need to be exceptional to succeed are bad business. “The scab you’re picking at is called execution,” says legendary producer Scott Rudin (The Social Network, True Grit). “Studios are hardwired not to bet on execution, and the terrible thing is, they’re right. Because in terms of execution, most movies disappoint.”
With that in mind, let’s look ahead to what’s on the menu for this year: four adaptations of comic books. One prequel to an adaptation of a comic book. One sequel to a sequel to a movie based on a toy. One sequel to a sequel to a sequel to a movie based on an amusement-park ride. One prequel to a remake. Two sequels to cartoons. One sequel to a comedy. An adaptation of a children’s book. An adaptation of a Saturday-morning cartoon. One sequel with a 4 in the title. Two sequels with a 5 in the title. One sequel that, if it were inclined to use numbers, would have to have a 7 1/2 in the title.
We have to be very clever about those things. You have to remember that it’s only a few hundred years, if that much, that artists are working with money. Artists never got money. Artists had a patron, either the leader of the state or the duke of Weimar or somewhere, or the church, the pope. Or they had another job. I have another job. I make films. No one tells me what to do. But I make the money in the wine industry. You work another job and get up at five in the morning and write your script.
This idea of Metallica or some rock n’ roll singer being rich, that’s not necessarily going to happen anymore. Because, as we enter into a new age, maybe art will be free. Maybe the students are right. They should be able to download music and movies. I’m going to be shot for saying this. But who said art has to cost money? And therefore, who says artists have to make money?
In the old days, 200 years ago, if you were a composer, the only way you could make money was to travel with the orchestra and be the conductor, because then you’d be paid as a musician. There was no recording. There were no record royalties. So I would say, “Try to disconnect the idea of cinema with the idea of making a living and money.” Because there are ways around it.
I’ve probably written about this somewhere and somewhen before, but here it is again because I want to make sure I have it in case the original source is lost. Back when Stewart Butterfield & co. started Ludicorp (which was sold to Yahoo! along with Flickr), their about page listed a corporate philosophy so fantastic that it’s the only such philosophy I’ve pumped my fist at. It takes the form of a passage from Disclosing New Worlds: Entrepreneurship, Democratic Action and the Cultivation of Solidarity by Charles Spinosa, Fernando Flores & Hubert Dreyfus:
Business owners do not normally work for money either. They work for the enjoyment of their competitive skill, in the context of a life where competing skillfully makes sense. The money they earn supports this way of life. The same is true of their businesses. One might think that they view their businesses as nothing more than machines to produce profits, since they do closely monitor their accounts to keep tabs on those profits.
But this way of thinking replaces the point of the machine’s activity with a diagnostic test of how well it is performing. Normally, one senses whether one is performing skillfully. A basketball player does not need to count baskets to know whether the team as a whole is in flow. Saying that the point of business is to produce profit is like saying that the whole point of playing basketball is to make as many baskets as possible. One could make many more baskets by having no opponent.
The game and styles of playing the game are what matter because they produce identities people care about. Likewise, a business develops an identity by providing a product or a service to people. To do that it needs capital, and it needs to make a profit, but no more than it needs to have competent employees or customers or any other thing that enables production to take place. None of this is the goal of the activity.
To which the Ludicorporate added: “The goal is to kick ass.”
The jewelry business — like many other businesses, especially those that depend on selling — lends itself to lies. It’s hard to make money selling used Rolexes as what they are, but if you clean one up and make it look new, suddenly there’s a little profit in the deal. Grading diamonds is a subjective business, and the better a diamond looks to you when you’re grading it, the more money it’s worth — as long as you can convince your customer that it’s the grade you’re selling it as. Here’s an easy, effective way to do that: First lie to yourself about what grade the diamond is; then you can sincerely tell your customer “the truth” about what it’s worth.
As I would tell my salespeople: If you want to be an expert deceiver, master the art of self-deception. People will believe you when they see that you yourself are deeply convinced. It sounds difficult to do, but in fact it’s easy — we are already experts at lying to ourselves. We believe just what we want to believe. And the customer will help in this process, because she or he wants the diamond — where else can I get such a good deal on such a high-quality stone? — to be of a certain size and quality. At the same time, he or she does not want to pay the price that the actual diamond, were it what you claimed it to be, would cost. The transaction is a collaboration of lies and self-deceptions.
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