Category Archives: Business

The End of Being Organized

Software is getting better and better at helping manage your life, so that you don’t need stay as organized as you used to. In fact, this article from one tech journalist is even titled “stay disorganized.” In the abstract, this is a good thing. Why should people have to remember stuff, or spend time organizing their lives, when computers can do it for them? Isn’t that one of the reasons we have computers…to do the boring stuff for us? But for people who are really organized, like me, this means that technology is taking away one of our comparative advantages. Historically I have been more productive than average, since I was really organized about my work. Now technology has reduced that advantage.

I think the first step in this direction was when Google introduced Desktop in 2004. It searched your PC much faster than the old Windows Explorer search, so that you could find files (word docs, spreadsheets, etc.) even if you couldn’t remember where you saved them or what you named them. That was awesome, except that I already knew where all my files were, because I was an aggressive user of folders and subfolders (sharp-eyed readers know that I have previously commented on folder people vs. non-folder people). Thanks to Desktop, the five minutes I spent working while someone else was searching for a spreadsheet was reduced to five seconds. My productivity advantage disappeared.

Then Google brought that functionality to email (no folders at all when Gmail launched), again eliminating the advantage of my clever folder systems. And now we are seeing apps that apply that same computerized organization to your entire life. What if you forgot to print a travel itinerary, or even write down your flight number? No problem, Google Now will do all that for you. So much for my advantage of having a detailed itinerary prepared, breezing me to my destination ahead of everyone else. EasilyDo and its competitors will help manage your duplicate contacts, remind you of your mom’s birthday, and even buzz you when you haven’t returned your CEO’s phone call.

For society, this is great, freeing up space in people’s brains to write, or cure cancer, or develop more organizational apps. For me, it’s a disaster. I had one claim to fame – being organized – and now it’s gone. I guess I need to find an old has-been app.

Native Advertising: Creative is King

In the internet media world, “native advertising” is all the rage. Native ads are ads that have enough content to be interesting to readers, and are more organically embedded in the content of the website. In other words, advertorials rather than intrusive banner ads. Some people complain that native advertising breaches the editorial wall, and others say that such breaches are the only way for publishers to make money online. There is truth to both sides of that argument.

But editorial purity is not the point of this post. Instead, I want to focus on how the success of native advertising shows that, yet again, content is king. When you read about how and why native advertising is working (like here and here), you’ll see it constantly described as great content you want to read, as adding value to consumers, etc. Native advertising works to the extent that the content is actually good. Because what consumers care about is content.

Or, in the context of an advertising agency, creative is king. If you want to produce good content, you have to have good creative people doing the producing. I think that the real development here is not native vs. non-native, but rather that marketers and their ad agencies are finally putting serious creativity into online advertising.

Since the beginning of the online era, I’ve felt that the main problem with banner ads was not that they were intrusive, but that they sucked. Nobody put any creativity into them. Partly that was driven by size – there just isn’t enough real estate to do much with them – but partly it’s because online campaigns aren’t the glory campaigns in an agency. TV is where the glory is earned for ad execs. TV commercials win awards and get talked about. Online, on the other hand, is boring. It’s basically direct mail, for god’s sake.

Native ads, however, are larger and have a variety of possible formats. There is room for far more creativity than you have in banners. It’s still not a super bowl TV spot, but it’s a much broader canvas than a banner ad. Moreover, with so much of advertising budgets shifting to online, web advertising is getting more respect within agencies, and so top people are working on the web ads.

Yes, native ads are in the middle of the content, but that isn’t their innovation. Their innovation is in size and flexibility, which enables creativity. Thus, the real key to native is that it gives marketers room to focus on quality. And when quality work is done, people pay attention.

Reviewers Focus on New Instead of Good

Something that I often see happen with professional reviewers is that they get so focused on the details of what they’re reviewing that they can miss the big picture. As they become ever more expert in their field, they tend to get mired in the miniscule differences that only an expert can see. This isn’t necessarily a bad thing – you want your reviewers to know what they’re talking about – but you need to be aware of this possibility and read the reviews accordingly.

For example, in reviews of TVs (not TV shows….actual TVs) you’ll often see reviewers rhapsodically discuss the blackness of the blacks, or maybe discuss in detail the customizable settings 7 layers deep, like this: “I really appreciated that both THX Cinema and THX Bright Room offer basic adjustments.” And for the serious gear-head, that is useful info, but for most of us, we just want to know if the picture is any good.

Similarly, this review of The Avengers discusses “the grinding, hectic emptiness, the bloated cynicism” (lines I wish I wrote, to be honest!) of the film, but not so much its entertainment value. Again, a useful review for the cineaste, but perhaps less valuable to a guy looking for a fun Friday night flick. Of course, you should probably know that a film review in the NY Times is going to trend toward the intellectual and away from the fun.

We saw a similar dynamic in the recent reviews of the new Yahoo weather app. Reviewers loved it, raving about its “modern design” and calling it “stunning.” And it is indeed a lovely app. But is loveliness essential to a weather app? When you say something like this

Visually rich is a great way to describe the new Yahoo Weather app for the iPhone. It uses Flickr community images to illustrate the weather in glorious, full-screen color rather than a boring table of temperatures with some tired pop-meteorology icons

– aren’t you missing the forest for the trees? Because what most users really want from their weather app is the ability to quickly see the weather forecast, and those “tired” icons do a pretty good job. Look at this photo, from Yahoo’s weather page on the web.

Tired, but very useful

Tired, but very useful

Pretty useful, yes? But the reviewers, so focused on their reviewerly details, have lost sight of what the real goal is, because they so want something to be different, fresh, new. Just like the NY Times wants The Avengers to be other than cynical, while the target audience wants nothing more than cynically formulaic entertainment. So absolutely read reviews, but keep in mind that most reviewers care about different things than you do.

Technology, Hubris and Lunch

As you may know, here in Silicon Valley the latest thing is for companies to provide all their employees with free lunches (and often breakfast and dinner too). I think Google was the first to do this, and Facebook followed them, and now even small startups bring in a catered lunch every day, or even hire their own chef. This week the WSJ reported that the IRS is looking into whether this perk should be taxed like most employee perks are. After all, the IRS thinking goes, this is effectively compensation.

I’m no expert on tax law, so I can’t really say whether these lunches should be taxed or not. The way the WSJ laid out the issue, it certainly seems like taxation is the legal path, but the article may have not framed the issue properly.

But one of the arguments that tech companies are making is that the lunches aren’t compensation, but an essential part of the collaborative culture of Silicon Valley. As one tax attorney put it, “there are real benefits for knowledge workers in having unplanned, face to face interaction.” This is complete crap.

Can anyone say with a straight face that it’s essential for an engineer to run into a marketer at Facebook, but that doesn’t matter at Procter & Gamble, or at Caterpillar? That somehow cooperation is more impactful at technology companies than other companies? Sheer idiocy. Having interaction between various constituents of a company is valuable no matter what the company does. To claim that somehow it’s different in Silicon Valley is just the height of hubris.

Spamming Your Friends on Facebook

There are many great things about social media, but there are definitely some pretty crappy elements too.

One of those crappy elements is the tendency of people to use their news feeds to promote their business. You see this on Facebook, LinkedIn, Twitter – someone puts into their feed a blurb about their company or their professional life:

  • My store was just mentioned in People magazine!
  • Vote for my tech company in this best-startup competition
  • Check out my interview on CNN regarding spamming your friends

It takes the self-glorification that already pervades social media – “look how great my life is!” – and adds a professional component. Seeing these items in a friend’s news feed, where I can’t avoid them, is sort of like the friend giving my email address to a spammer, but instead of some stranger peddling me Viagra, it’s my own friend doing the spamming.

When you bring money and career into the news feed glory wall, it commercializes friendships; people are turning friends into customers. And I’m not sure that transformation is reversible. Once you’ve monetized our relationship, can I ever see you as just a friend again?

Y Combinator: Living the Bubble Dream

Two of the higher profile technology incubator programs – Y Combinator and Tech Stars – recently announced their graduating classes (read about them here and here), and in looking at the companies, I saw, yet again, some reminders of the 1999-like frenzy that the technology industry is currently experiencing.

A few thoughts:

  • Not everything needs to happen online; some things (eg. grocery shopping) satisfy a ton of people in their offline incarnation
  • Lots of things are already online and don’t need a new vendor. Just because you call yourself the Airbnb of vacation rentals doesn’t mean that VRBO, the very successful existing vacation rental website, needs to be “disrupte.”
  • Vertical slicing doesn’t work online. It turns out that the Yelp for contractors is Yelp.

We saw this back in 1999: remember “vertical portals?” Yahoo for gays was PlanetOut, and that didn’t work out too well at all. Vertical slices sound good on paper, but they just don’t work; online it’s just too easy to move from site to site to get what you want. We also saw in 1999 the dot-coming of everything. “We’re going to take your garden online!” Umm, no, you aren’t.

The article about the Y Combinator class even admitted that these companies aren’t world changers, but “perhaps they’ll save a headache or two.” When this is the best that a boosterish tech reporter can come up with, you’ve got problems.

How is Foreign Tax Repatriation Different than Immigration Amnesty?

As politicians in DC lurch toward some sort of bipartisan approach to immigration, conservatives remain adamant that immigrants currently in the country illegally be given no path to citizenship. These conservatives see no reason to reward lawbreakers with citizenship, and worry about the message that will send to future immigrants: if you come here illegally and stay long enough, you will get away with it. I understand this perspective; amnesty reeks of moral hazard. I think that realistically, we need to find a path anyway – we can’t just deport 11million people, many of them employed and embedded in society. But I do very much appreciate the concerns of conservatives on this issue.

However, at the same time, the same conservatives are calling for a tax holiday that will let US companies repatriate their offshore cash at reduced tax rates. Under current law, companies can keep their overseas profits in low tax countries, but if they try to bring that cash back home, they have to pay higher US taxes. In 2004 companies were granted a one-time holiday, with tax rates reduced to 5 percent, and they took advantage by bringing a ton of dough back into the US. But of course, all this tax amnesty did was encourage companies to keep driving their revenue through offshore tax havens, and then use their lobbyists to push for another tax holiday.

If amnesty creates moral hazard, by encouraging people to do the wrong thing and then be forgiven, why would multinational companies be different than illegal immigrants? Storing your cash offshore is not illegal, while immigrating illegally obviously is, but the motivation component is the exact same: if you believe that amnesty encourages behavior, then you need to apply that theory equally across your policies.

By the way, among the leading rationales advanced for the tax holiday is that companies will invest the repatriated cash in jobs and growth. However, studies of the last holiday showed that companies mostly returned the cash to shareholders. Even the Wall Street Journal says so! Here is a story about how companies play the cash repatriation game, and here is one about how hard corporate lobbyists are pushing for a holiday.