Bill Gates and his first annual Foundation letter

Last Monday Bill Gates published his first Foundation’s Annual Letter, inspired by Warren Buffett’s annual letter to the Berkshire shareholders. I think it’s an absolutely must read for any marketer for the following reason:

•  He outlines the big vision and principles of his foundation, while diving into the few separate focus areas, almost always starting with a number based challenge against which he outlines a measurable goal for the foundation. His foundation for example is aiming to cut down the 10 million children deaths in half within the next 20 years. I would love to see that marketers write their annual marketing plans that clearly and number centric, always balancing the need for a big vision and the urge for implementing concrete projects
  
• He has an ambitious and honest tone that educates, inspires, and directs anyone reading the annual letter. It must have been quite some work to put it together. But it would be great if big brands or companies could have a scaled down version of their marketing strategies and brands once per year. Their marketing organizations and external partners would know much more about core priorities and strategies that would make everyone a better marketers
  
• He tries to be as transparent as possible. Most marketers still don’t pursue sufficiently today’s necessity of transparency. It’s less sharing trade secrets than spreading the right message within your own organization and beyond. It’s the only way of how to change things in today’s world of 24/7 information and stimuli. 

I am curious to read his next letter in January 2010

What about the Semantic Web?

The discussion and hype about the Semantic Web has significantly decreased over the last 6 or 12 months after the recession has hit North America. Semantic Web has been defined in 1999 by Tim Berners-Lee:

“I have a dream for the Web [in which computers] become capable of analyzing all the data on the Web – the content, links, and transactions between people and computers. A ‘Semantic Web’, which should make this possible, has yet to emerge, but when it does, the day-to-day mechanisms of trade, bureaucracy and our daily lives will be handled by machines talking to machines. The "intelligence agents"people have touted for ages will finally materialize.”   

Despite its ambitious and visionary notion I believe that the Semantic Web will see more investments and progress over the next five years than most people believe. Why?

•  There are quite a few Silicon Valley start-ups who are focusing on this space, probably more than even before
  
• Computer and Processing Power is getting cheaper, faster, and more powerful than ever
  
• Most important though: The increasing amount of Information (it is doubling every 3 years) will need new ways of organization. Human beings will be too challenged to use this vast universe of information in any meaningful way. 

The interesting part for marketers will be to find different forms of monetizing the Semantic Web. At the beginning only parts of the Web will migrate into the Semantic Web structure which will be the playground for figuring out how to make money. 

Maybe we should bet on the first brand that will pay marketing dollars to be on the Semantic Web? Or on the company that will be the major driving force in building the Semantic Web? Most likely it will not be Google or any currently widely know company.

Narrative Medicine

I always believed that mastering the understanding and telling of stories is in the center of democratizing data. It truly helps to make data accessible to a wide range of marketers. It seems that an increasing number of disciplines are discovering the power of understanding and telling stories as a way to diagnose problems and communicate them. 

A great indication for this phenomenon is a recent ad from Columbia University advertising a “MS in Narrative Medicine”. It says:

‘”The care of sick unfolds in stories. The effective practice of healthcare requires the narrative competence to recognize, absorb, interpret, and act on stories and experiences of others. Medicine practiced with narrative competence is a model for humane and effective healthcare. Columbia's new MS in Narrative Medicine seeks to fortify clinical practice and training with narrative skills in order to strengthen the overarching goals of medicine, public health, and social justice, as well as the intimate, interpersonal experiences of clinical encounter”. 

I love the four phase methodology of “Recognize, absorb, interpret, and act on” stories. We marketers probably need a fifth elements whch is to “Tell the story”. It’s an encouraging sign that even medicine tries to uncover stories and use the “Story” metaphor and methodology as a more holistic approach to understanding people, here patients, in our case consumers. 

Accountability in a Recession

You might be interested in an article that I just got published in this week’s AdAge. Accountability is get even more important in today’s tough time.

Ponzi scheme

Tim O’Reilly just published probably the most interesting Posting in this very young year. He quotes two economical experts who describe the current financial crises as an imbalance between true real wealth and fictional financial wealth. They argue that the true reason for the current crises is that financial assets outgrew the natural growth and the real assets on our globe. O’Reilly is even approaching one of the greatest heresies in today’s society: There might be no endless growth anymore. 

Erhard Eppler, a German thinker and politician very popular in the 80ies, differentiated already back then between qualitative and quantitative growth. Not every growth is good. If people get sicker, the more money is spent on medical expenses which are shown as economical growth. The focus should be more on qualitative growth that reflects people’s quality of life. 

Interestingly enough, it comes down to measuring the right things. It seems we are still measuring the wrong things (=quantitative growth) instead of establishing metrics that have real meaning (=qualitative growth). Since we are measuring the wrong outcome, we are focusing on the wrong thing. It could be an interesting exercise to develop a metrics system focusing on how marketing creates qualitative growth for the targeted consumer. 

Growth Expectations

The last few weeks I spent in good old Europe which enabled me to experience the different expectations and attitudes of societies in today’s tough economical climate. It showed me that expectations for economical growth differ more vastly by country than most people believe. 

Last week the prime time news show in Germany had two separate reports about the retail environment in Germany and the US within 10 minutes. First, the news show reported an assessment of the holiday season in Germany with an overall very upbeat tone. It showed a few retail experts that estimated a flat to slightly negative sales growth over the previous holiday season. It quoted one retail executive who expressed strong satisfaction with the season and its rather surprising success (only slightly negative growth or even flat!). 

A few minutes later a report about the US retail season showed a very different picture with a completely different tonality. The reporter mentioned the expectation of a 2% sales decline for the holiday season in the US and portrayed an absolutely abysmal picture for US retailers. The report stressed how devastated US retailers are and how US consumers stopped shopping over the last months. 

How can a 1% difference between sales growth in Germany and US over the holiday season justify such different reports? Cultural differences! Germans are not as growth oriented as Americans. For most Europeans no or slow growth does not equal complete disaster for failure while most Americans can not imagine an economy that does not grow substantially. This attitudes explains the stronger willingness of Americans to go into debt to maintain a strong growth rate whereas most Europeans don’t value growth itself that much to put aside all other values.   

Economists are currently predicting the long-term GDP growth downwards and are expecting a more normal annual average growth of around 3%. But most Economists are not taking in consideration the different mind sets of consumer expectations in regards to growth that is influencing the actual growth by country. It would be interesting to quantify more scientifically the different growth expectations by country and compare it with the actual growth rates.