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Direct response ads pay for themselves (at least they do when they work). Socially acceptable paid-for interruption leads to response, and the response (a sale, generally) generates revenue and you can run the ad again. Google's business is driven by direct response advertising.
Trust ads are generally unmeasurable. "I've heard of these guys, somewhere." Without consciously realizing it, we often choose to do business with the familiar, and ads increase familiarity. Particularly the right ad that runs in the right place. This is old school advertising, the first kind that appeared on TV. This is advertising that tells a story, advertising about belief, not necessarily action.
Demand enhancement ads remind us that on a hot day, we'd like a cold drink. They are ads designed to tickle and provoke, to increase the number of people in the market for what it is you sell. This is the best kind of billboard, the one that says, "next exit."
Every once in a while, an ad does all three things, but that's a foolish thing to hope for. Budget appropriately, because the very worst thing you can do with an ad is spend too little--it will get you the same results as spending nothing.
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Fun Night for the Eurosceptics: UKIP and Front National Storm Brussels; Infighting Begins Posted: 25 May 2014 11:04 PM PDT It was a fun night for the Eurosceptics.
Eurosceptic Earthquake The Financial Times reports Ukip Leads Populist Earthquake. The UK Independence party and France's far-right Front National stormed to victory in European elections on Sunday night, as populist and nationalist parties across the continent dealt a heavy blow to the European project.Eurosceptics Storm Brussels Also consider Eurosceptics Storm Brussels France's far-right Front National stormed to victory in European elections on Sunday night, leading an unprecedented surge in support for anti-EU parties across Europe that was set to reverberate far beyond Brussels politics.Congratulations for a well-deserved victory for the Eurosceptics. That said, don't expect much change. As noted before, the center-left and center-right parties will act in union to block any anti-euro measures. Race for Commission Presidency The EU Observer reports Juncker Declares Victory in Race for Commission Presidency. Jean-Claude Juncker declared victory in the European elections on Sunday (25 May), and staked his claim as the first man in line to claim the European Commission presidency.Infighting Begins And so the coalition infighting begins. The Euroscpetics will not vote for either Juncker or Schulz so it is going to be a difficult process coming up with 376 votes. Should Juncker ultimately prevail, he will not be willing to bow down to UK prime minister David Cameron's proposed rule changes. The whole setup is messier than it appears at first glance. Significant rule changes which Cameron has promised before an up-down vote on the UK staying in the EU seems highly unlikely, at best, no matter who triumphs as EC president. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific. |
Driverless Cars Legally Hit Roads as California Issues Licenses; The Last Mile Posted: 25 May 2014 09:59 AM PDT In August of 2013 I wrote Message to 5.7 Million Truck Drivers "No Drivers Needed" Your Job is About to Vanish. The key word in that sentence is "about". I did not mean immediately, but I did mean a lot sooner than truck drivers and the general public expect. Most protested. I received many emails saying this would not happen for decades. Many truck drivers thought it would never happen. Most mentioned insurance issues. Yes, there are problems, but time has marched on even quicker than I thought. TechCrunch reports California Will Start Granting Licenses For Driverless Cars In September. Stiff License Terms Yes, the terms of the license are stiff including $5,000,000 insurance against personal injury, death, or property damage. And a test driver has to be able to take immediate control of the car at all times. Nonetheless, the licensing is a big step forward. Totally driverless cars are but a single step away. All that needs to happen is for California to eliminate the requirement that someone has to be in the car at all times to take control. A big issue is that radar can detect size and shape of objects, but it does not have human judgement regarding danger. For example, a balloon blowing across the road is a much different thing from a hunk of metal the same size sitting in the road. Such difficulties will be overcome. Incentives and Implications The implications on the shipping business are staggering. A full-time truck driver might cost as much as $100,000 a year. The incentive to get rid of millions of full-time drivers is massive. A July 2013 Truckers Report headline reads ATA: Self-Driving Trucks Are "Close To Inevitable" However, the article itself dismissed the idea totally. "People come up with these grandiose ideas," says Bob Esler, a commercial trucker for almost 50 years. "How are you going to get the truck into a dock or fuel it?"The Last Mile Many of the objections in the above article have to do with the last mile. Let's assume someone has to load the truck. Let's also assume an actual skilled driver has to dock the truck and make the final delivery (arguably a bad assumption). Yet, even if those assumptions are true, nothing stops a trucking company from having distribution facilities right off an interstate near major cities, where local drivers deliver the goods the last mile. Why can't all but the last few miles be driverless even if a skilled driver is needed some step of the way for safety reasons? Technology marches on at a breathtaking pace. We might actually see commercial driverless vehicles on the roads within a few years. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific. |
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When you ask someone if they would use your new product, buy your new widget or participate in your new service once it's ready, you will get a lie in response.
It might be a generous lie ("sure, I love this") or it might be a fearful lie ("here are the six reasons I would never use this"). The fearful lies cause us to scale back, to shave off, to go for mediocre. And the generous lies push us to launch stuff that's just not very good.
People don't mean to mess you up, but you've made the error of asking them to imagine a future they have trouble imagining. It's incredibly different than asking them to justify what they already do. "Why did you buy that particular car?" queries a completely different part of the brain than, "would you buy this new kind of car?"
Imagine the early focus groups for an early modern car. "Why does the transmission say 'd' instead of 'f'? F means forward!" "Why doesn't the window work the way the windows in my house work?" "There should be a lot of warnings on this thing, it could kill someone." "There's a radio? Why don't you make the car good at just one thing..."
It's one thing for someone to explain why they read and liked a particular book. It's another to ask them if they would read it, or even publish it. Almost everyone is horribly bad at this sort of explanation.
Steve Krug has written a really useful book about this. The takeaway is to never again run an amateur focus group, never ask an investor to help you think about what the market wants. Instead, we have to show, not tell, must create environments where people choose, then ask them why.
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Former Bundesbank Vice-President Recommends Gold, Says Current Economic System is "Pure Fiction" Posted: 24 May 2014 09:43 PM PDT Anyone who is thinking clearly knows the economic system fostered by central banks is totally and completely out of control. Repetitive rounds of QE, competitive currency debasement, interest rates at zero, and sponsorship of the internet bubble followed by the housing bubble, followed by the current stock market bubble is proof enough. So, what I am about to report is really nothing but common sense, except for the fact that it comes from an unusual place, where one does not normally hear such discussions. Jürgen Stark, former vice president of the Bundesbank, and also former chief economist of the ECB (unofficial title) says "The System is Out of Control". Via translation from Libre Mercado, here are a few snips. Stark, until recently one of the big hawks central bank of Germany for his fierce defense of monetary orthodoxy, resigned in late 2011 for his outright rejection to the purchase of government bonds by the ECB launched the president of the institution Jean Claude Trichet. Since then, Stark has used his rare, but valuable public appearances to warn of the risks associated with the current policy of central banks to the crisis.System is Pure Fiction Stark is preaching to the choir, but it is appreciated. One does not normally hear such statements from central bankers or even ex-central bankers. That said, his statements would carry more weight if he was still with the Bundesbank. I wish Stark never left. Supposedly Stark Left for Personal Reasons but it's easy to discern he was fed up with being the only member of the ECB with a clue. You can only beat your head against the wall so many times before you lose all sense of hope and finally your mind. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific. |
Regulator Fines Barclays for Gold Manipulation: Permanent Price Suppression? Posted: 24 May 2014 09:30 AM PDT A couple of readers asked me to comment on the news Regulator Fines Barclays Over the Pricing of Gold. A British financial regulator has fined Barclays $43.9 million after accusing a former trader at the bank of improperly influencing gold prices at the expense of a customer.Gold Manipulation Details ZeroHedge has specific details of what took place in "I Am Hoping For A Mini Puke": Details Of Barclays' Gold Manipulation LIBOR Manipulation, Euribor manipulation Barclays was the first to admit guilt in manipulating LIBOR, but numerous banks were guilty. The BBC has an interesting article on the Timeline of the Libor-Fixing Scandal. The Financial Times notes Euribor manipulation involving HSBC, JPMorgan and Crédit Agricole. For details, please see Brussels Charges Banks for Euribor Fixing. Surprising? No one should be shocked by this. Manipulation occurs all the time, in both directions, by all the big players, in numerous markets. Guess what would have happened if Plunkett's client had $10 million in PUTs betting the price of gold would have declined. Does anyone think Plunkett would not have done what he could to force the price of gold up? Although the recent spikes at illiquid times have been to the downside, details of how that "fixing" occurred, still support my two basic theories.
Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific. |
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A recent article outlines how NFL cheerleaders are paid less than minimum wage, disrespected and treated quite poorly. So why do they put up with this lousy behavior?
In many ways, the appeal is an extension of what we were taught in high school. To be seen, to be noticed, to be picked. Even more than that, it's part of the human condition: To be part of something, in a small way, to matter.
Despite the obvious inequity of working for free for billionaires to celebrate players paid millions on behalf of advertisers earning even more, despite the conditions and the insults, people keep trying out to be picked by the team. For now.
The shift that's happening due to the long-tail open nature of new media, though, is that it's easier than ever to pick yourself and to be seen (even if it's not on national TV). It's easier than ever to start your own dance troupe, to build a group that will travel to cheer enthusiastically, for hire. It's easier than ever for anyone to be seen in videos or heard in podcasts or read online.
The fascinating lesson about human nature is that people aren't always driven by a rational analysis of work as an exchange of labor for cash. We want to be seen and we seek to belong. It's a shame when an organization takes advantage of that and treats people unfairly.
When we offer people a chance to matter and to be seen, we have the chance to offer them something magical.
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