When Groupon sells a Groupon–say, a $25 coupon for $50 of belly-waxing services–Groupon collects the $25 immediately (from the subscriber’s credit card). Then, sometime later, the subscriber generally goes to the belly-waxing salon and gets his or her belly waxed. And, sometime after that, Groupon remits a portion of the $25 to the belly-waxing salon.

What this means is that, when Groupon is growing rapidly, as it is now, it collects a ton of cash from its subscribers long before it has to deliver some of the cash to its merchant partners. And that generates positive cash flow.

This is how Groupon can generate cash even when it is “losing money” on its income statement.

The full-year cash flow statement for 2010 illustrates this.

Groupon “lost” $413 million in 2010 on its income statement. In the same year, however, it generated $72 million of cash.

So What?

The benefit of positive cash flow is that Groupon’s operations can fund the company’s growth even while the company is losing money.

Of course, the benefits of this positive “cash-cycle” won’t last forever. When Groupon’s growth slows, the cash that it has to deliver to the merchants that did Groupons last quarter will start to equal (or even exceed) the cash that Groupon collects from customers who buy Groupons this quarter, and the company’s cash-flow statement will look more like its income statement.

(Amazon went through this transition, too, and it can be a painful one.)

In other words, at some point, unless/until it turns profitable on an income statement basis, Groupon will have a cash hole to fill. And the only way it can sustain its positive cash flow while losing money on the income statement is to keep growing rapidly. If the growth stalls before the company turns profitable, cash flow will turn sharply negative.

But, for now, even though Groupon is “losing money,” it is generating cash. And it can use this cash to fund operations and growth.

Source: businessinsider.com

In a stock market bubble, investors stop thinking about what they’re buying and start looking around them to see who else is buying it.

Joe Investor sees a sizable group of other investors piling into a stock or sector, driving the price higher. He figures they’ve thought things through, so he’ll go along for the ride.

Jill takes Joe’s lead, figuring he knows what he’s doing. Jerry follows Jill. Julie follows Jerry. The blind are leading the blind.

Well guess what?

There are marketing bubbles too…

Some marketing tactic or strategy is hyped beyond all reasonable expectation… newbies who don’t know any better jump in… and a bubble is born. As the hype grows, it creates a kind of vortex that sucks in more and more people. The number of dupes and the number of promoters both skyrocket.

Some investment analysts are calling the recent LinkedIn IPO a warning sign that a new tech bubble might be upon us. The stock debuted at $45 and immediately started gyrating between $80 and $120, hundreds of times 2010 earnings. In plain English, there was no justification for these prices.

Groupon and Facebook are planning IPOs as well, and they will most certainly garner the same kind of senseless, nosebleed valuations. The bubble will balloon and burst. And overnight, billions of dollars will change hands, just as they did during the dot-bomb bust of the late nineties. Foolish investors holding these stocks will get the shirts ripped from their backs.

With marketing bubbles, the damage is subtler…

Bubble stuff. All about Facebook and Twitter and mobile marketing and Groupon and other so called “game changers.” Now I’m not saying there is no value in these things. It’s just that they are hyped into the ozone… out of all proportion… beyond anything even remotely real.

In the world of investing, the basics are things like earnings growth, return on equity, and profit margins. The boring, common sense stuff that allows you to rationally compare one stock to another. In the marketing world, it’s return on resources invested (RORI). Is marketing this way worth my investment? Is it the best use of my resources?

The fact that there are umpteen million users with a Facebook account makes for great hype. Heck, if it were a country it would be the third-biggest. But what does that mean in terms of the RORI for your particular business?

Most people who market with social media haven’t a clue. Their behavior is driven purely by peer pressure.

And then there’s the whole Groupon thing…

We’re seeing Groupon copycats popping up everywhere, like Whac-a-Mole. They’re hyping the slashing and burning of prices to blue blazes. There are even Groupon wannabes for information products. I’m willing to bet that if it hasn’t happened already, you’re about to get pitched by one of them.

“Let us expose your company to the multitudes,” they say. “You’ll gain hundreds, perhaps thousands, of brand-new customers. All you have to do is let us sell your $1,000 info-product digitally for $17 bucks and pay us a commission.” Come again?

Let your decision on all things bubbly be based on good old-fashioned RORI, not peer pressure.

Source: Daniel Levis

The number one sin of all marketing is to be “Boring.” In fact, 72% of all Direct Mail (which this book addresses) is sorted over a wastebasket.

Bill shows page after page of outrageous marketing that never gets thrown away. Such as yellow legal-paper letters, little kids crayon letters, lumpy mail with nickels pasted to them, holiday cards that show a turkey saying, “Eat Ham!” Now that’s funny; I don’t care who you are!

However, what I like best is that Bill is not just some ordinary consultant or guru who only tells you how to do it. He’s actually done it all himself! Bill has owned the number one men’s retail store in Baltimore and many of the examples are from his very successful campaigns.
Everyone will enjoy these fun filled, exciting marketing ideas that will make their marketing stand out from the crowd.

Outrageous Advertising That’s Outrageously Successful: Created for the 99% of Small Business Owners Who are Dissatisfied with the Results They Get From Their Current Advertising by Bill Glazer is available for an outrageous price of $4.95 but I don’t know for how long.

Best marketing strategy from Bill Glazer

Small business marketing strategies with Bill Glazer

So, how do you really Win and Keep customers? Simply by delivering what matters most to them. Is it that simple?

Crucial messages need not be complex. The simple message of Simply Better is that in single-mindedly pursuing differentiation, many companies have failed miserably in their stated goal to be “customer-focused”. Except for relatively rare instances, customers care little for the addition of unique features and clever innovations. What they really want is the reliable delivery of “generic category benefits” – products that *work* and reliable services that take place on time. Although companies often dismiss this as “table stakes”, the data show that businesses fail to deliver these basics far too often.

If time is of the essence, it is my editorial duty to let you know that you will find most of the important ideas of this book in the authors’ MIT Sloan Management Review article, “Don’t Be Unique, Be Better.” Barwise and Meehan do not entirely dismiss the conventional wisdom that competitive positioning and differentiation require companies to offer customers something they cannot find elsewhere, but they do insist that this has distracted companies from maintaining a true customer focus and from delivering the essential category benefits valued by customers. The only area in which differentiation is clearly the right way to go, they argue, is in your advertising and marketing messages. Elsewhere, they urge companies to think “inside the box” by refining, perfecting, and delivering on the essentials that customers badly want. The failure of companies to do this has created deep customer dissatisfaction.

The good news in this is that organizations that adopt a true customer-centric perspective can generate a low-risk, high return opportunity. To help your business reach this state of genuine customer-centricity, the authors first explain how customers see your brand and make purchase decisions. They then explain how to convert that understanding into a clear view of what customers really value. These are the actual (and potential) generic category benefits. The book also examines the management challenges to creating these benefits.

The last chapter of this book sums up by providing five rules to becoming “simply better”:

This last principle refers to the authors’ discussion of important arguments in favor of managers getting out of their offices and directly interacting with customers. This kind of immersion works because it avoids distorted images of customer reality, it helps filter indirect data such as market research, it acts as a source of storytelling and anecdote, and it spreads the results of both learning and the act of learning.

If you decide to read this book, rather than the excellent article-length distillation, you’ll find some other fine points that often go well beyond the article. Contrary to the usual concentration on measuring customer satisfaction, Barwise and Meehan make a strong case for measuring and monitoring the drivers of *dissatisfaction*. They add to what seems to be a recent trend by emphasizing the risks and drawbacks of flanking strategies that require strategic innovations, arguing that it is usually better to be an excellent imitator. Chapter 6, “Customer-Focused Mind-Set“, sets out a refreshing (though not truly original) view of “fast and right processes and a pure air culture”. These honor the practices of “hard work decision making”, “accountable experimentation”, and a culture in which challenge and debate are seen as forces for good throughout the organization, and where no one expects an easy yes to proposals.

Source: Patrick Barwise “Simply Better” Winning and Keeping Customers by Delivering What Matters Most

Is Social Media a Fad?
You can either promote your Business or Cause using? Social Media, so people will follow you or keep traditional advertising with big pocket budgets.

Video Part 2…

Did you know these Human Capital stats?
Perhaps the sources and references for the data contained can be argue, but the trend is clear.

The Value of Influence

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Most people are excited about this because they love to see someone challenge Google’s empire. But me, I’m excited for a different reason. I can smell a new avenue for some mega-effective SEO.

Before I go any further. I don’t think Facebook is going to be knocking out Google just yet. They’ve got a lot of work to do to compete with Google’s extremely advanced search engine, but you never know what else Facebook has up their sleeve.

So here’s how it’s going to work.

Facebook is giving webmasters 2 tools to use to index their page for Facebook Search. 1- “Like” button to install on their pages that Facebook users can click. 2- A set of tags that allows webmasters to tell Facebook what their site is all about.

The search results that Facebook gives will be based on how many ‘Likes’ the page has received and the information provided in the tags. Essentially creating a search engine based on “likes” instead of “links”.

Here’s why you need to get your SEO skills warmed up and ready.

We’ve seen what Facebook did with Ads, so I think it’s fair to say their search engine has some strong potential to become a big time player, Especially since they have Bing powering it.

Since Facebook is giving us the opportunity to improve our search rankings with them by utilizing some pretty sweet tools, it should be worth getting in on. And like most SEO campaigns, it’s a good chance to save dough and get continuous results without continuous work.

Do you think Facebook Search will succeed? Let me know your thought, comment below!

Source: Ryan Deiss

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Honda has unveiled a new digital affiliate marketing campaign to promote its hybrid sports coupé, the CR-Z. The marque has also appointed Elvis to handle its pan-European direct marketing and digital advertising account after a pitch against undisclosed agencies.

The CR-Z work has been created by relationship marketing agency HS&P and targets ambitious and affluent individuals.

The online campaign includes social media elements and launches today (11 March) and will be accompanied by a series of direct mail and email communications.

Running alongside the above line advertising, the campaign aims to generate leads for Honda’s ongoing prospect relationship programme and create buzz and WOM surrounding the CR-Z ahead of its launch in June.

The CR-Z is a coupé sport hybrid – the first of its kind that challenges the conventional use of hybrid technology.

Lee-Anne Crossley, marketing communications manager Honda, says: “Even in a challenging market, there are going to be customers who seek fun, excitingly designed cars – especially if they also offer an affordable ownership experience. With its striking design and advanced technology, The Honda CR-Z is a very likely candidate for ambitious and successful individuals; this affiliate campaign will seek out these individuals and entice them”.

Source: MarketingWeek

2. Domino’s Pizza trials world’s first ‘Social Affiliate’ tool

Domino’s Pizza is claiming a world first by trialing a new ‘Social Affiliate’ tool, a widget that combines social media and affiliate marketing.

The tool enables anyone with a personal web space, such as a social network page or blog, to host advertising from nominated brands.

It aims to complement more orthodox affiliate marketing strategies, which use ‘professional affiliates’, by enabling any consumer to promote products or services within a framework of designated brand guidelines.

Internet users can earn revenue whenever a sale is driven from their social network or blog page.

To access the widget, publishers can sign up and download a dashboard to track the sales generated through their web page. The Quantum dashboard plugs into the Affiliate Window network reporting system.

An online PR and blogger outreach campaign will launch the ‘Social Affiliate’ tool to drive awareness and encourage downloads. This will be supported by an online media campaign later this spring.

“Brands benefit by aligning with sites run by fans who are more likely to drive a sale, while site owners can generate revenues from their Facebook page or blog,” said Dan Clays, managing director of BLM Quantum, the company which developed the tool.

Source: UTalkMarketing

In a nutshell, it is the ability to get your marketing messages out to mobile devices, using SMS technology, otherwise knows as text messaging.

I’m not talking about spamming text messages out to cell phones, I’m referring to a building a permission based list of people who want your messages. This can be done in one of two ways…

1. Via signup forms at your website that include a field for a cell phone number

2. Via “mobile keywords” that people text to your “short code” mobile number after they see it advertised somewhere, such as at your site or on radio, tv, print, email, etc. (You know, like text “freebies” to 69302 for free web business products.)

This technology circumvents the growing problems with getting opt-in emails through spam filters and into recipients email boxes.

Text messages are getting somewhere near 90% open rates which trumps the less than 25% open rates of even the best email lists.

That’s exactly why more and more businesses are moving toward this technology. And it is also why you’ll be seeing a LOT of related offers from Internet marketers this year and beyond.

As I mentioned, I had three such offers in my email inbox this morning. Two of those three offers were from well-known marketers offering a web based service that facilitates mobile marketing.

After further investigation though, I discovered that their new sites were merely “white label” versions of a service called Trumpia.

After this quick sponsor message from yours truly, I’ll tell you all about Trumpia and why it’s catching on like wildfire.

Trumpia is one of the leaders in providing mobile marketing tools to businesses.

Their web-based service is sort of like an autoresponder service, but with the addition of instant messaging and text messaging capability.

It is surprisingly affordable and even offers a free trial.

I recently took the free trial to see how easy it was to use. To my surprise, I had a web page up and collecting info in about 25 minutes.

I used Trumpia to build a free alert service where I’ll be giving away some of my products for free.

See this example.

I think you’ll agree that the interface is sharp and the service easy to use. And the possibilities from a marketing standpoint are endless. You can use it to send out coupons, gifts, appointment reminders, special offers, and well, just about anything that your clients or prospects might consider valuable info.

I think this may be one of those technologies that makes a big difference for a lot of businesses. After all, cell phones are rapidly evolving into full blown hand held computers, and people are on them all the time now. I know I surf the web constantly on my iPhone and I see more and more people attached to their handhelds like they are some kind of electronic security blanket.

Growing a list of clients and prospects you can reach in an instant, is comparable to the early days of email list building. Those of us who got in early and grew really large, targeted lists, really did well. (Of course you need to offer value to your list members too!)

Trumpia is already making quite an impact for some early users. The following link to their blog contains some case studies showing the different ways their clients have been getting “instant” results: (pun intended)

More Live Examples

If you would like take Trumpia for a test drive, use my affiliate link below and you’ll get DOUBLE the number of emails, instant messages and text messages. The promo code is “bizweb” and it should be automatically entered when you sign up at this URL…

Test Drive Trumpia

On January 8th, Google released a mobile keyword tool that allows AdWords users to see mobile search volume from within their AdWords account.

Source: Blog

By now, your company’s power-tripping “get out of my way and let me handle it” computer specialist has become a cliché. Everyone has an “IT guy” story. Saturday Night Live even created a parody of him… a caricature of the computer geek who has terrorized millions and millions of office workers for the past decade.

They control your computer. They control your Internet access. They control information. Many of them, handed a tiny bit of power for the first time in their lives, enjoy it immensely. My publisher’s IT guys even have even given themselves the nickname “IT Overlords.”

Enter “cloud computing.” Enter the era of the laid-off IT guy.

You see, right now, most major corporations include enormous IT departments dedicated to storing and sharing mountains of data. They also own a pile of pricey, custom-developed software that only works on site.

That’s why cloud computing is catching on so fast. Eventually, companies will be able to sell off their server farms, send their files to someone who can manage them more efficiently… and fire their IT guys.

And that’s just the first step. Once things get rolling, companies will be able to plug into the cloud for any IT need – hardware, software, web hosting, networking, etc. And costs will fall, since payment is based on usage not actual hardware. Finally, businesses will be able to focus on what to offer rather than technical details of how to offer the service.

Some of tech’s biggest names are leading the cloud computing charge. For example, Google’s internet-based word processor and spreadsheet program are fighting to replace the desktop version of Microsoft’s Word and Excel. Saleforce.com’s application allows businesses to centralize software while paying as they go with monthly license fees. VMware’s “virtualization platform” allows data centers and servers to run more efficiently.

Leading IT research firm Gartner estimates cloud computing revenue will grow at an eye-popping 25% annual clip over the next few years. By 2013, the firm expects the industry to top $150 billion.

Fortunes can be made by catching this massive, long-term trend. However, you won’t find any five or ten-baggers in the names above. At over $60 per share, Salesforce.com is trading at a stratospheric 100 times this year’s estimated earnings. VMware is not much better. At 40 times earnings and seven times 2010 revenue, the stock is one bad quarter away from a bloodbath. And tech darling Google only gets a sliver of its revenue from cloud computing.

A better way to jump in today is through the more obscure service providers. These companies provide the physical servers, hosting space, and a means to communicate with them. Prominent names include Equinix (EQIX), Rackspace (RAX), and Terremark Worldwide (TMRK).

I expect to see massive consolidation in the industry over the next decade. The biggest tech names will likely gobble up the smaller players as a cheap way to gain access to the latest breakthroughs. Early shareholders will reap the windfall.

We create epipheos.

Umm, can you be more specific…?

Descriptions are usually long, boring, and forgettable. BUT experiences that create amazement, discovery, and inspiration are life changing. They change people to a point that causes them to try new products, adopt new practices, and even re-think the way they live life.

We LOVE (and specialize in) creating exactly those kind of experiences and we believe that an epipheo is the best way to do that.

You got my interest…

Give us a shout. We’re looking forward to turning your idea into an epipheo.

2. Meaning: Getting ahead by slashing prices is cutting your own throat. You MUST take a lead from Starbucks and deliver an entire customer experience. Move UPSTREAM, not down.

3. Your marketing plan MUST include Google. Love ‘em, hate ‘em, Mother’s Milk or Big Brother, there is no avoiding this fact.

4. If your marketing plan ONLY includes Google, you’re an accident waiting to happen. You must invoke the Unlimited Traffic Technique and elevate your conversions to a level where you can compete on any level playing field. Once accept this reality, you liberate yourself from the mosh pit of misery and mediocrity.

5. If you have a successful affiliate business and it’s still standing, congratulations. You still have time to move to higher ground. Time to move NOW.

6. Regardless of where you buy clicks, if you don’t have an Autoresponder sequence, you’re leaving 2/3rds of the money on the table.* Social Media is a freaking a waste of time compared to just TEN well-written emails. In my opinion if you don’t have AR’s in place you’re lucky to still be alive.

7. The principle of the Slight Edge says: If you’re just 5% better than everyone else you get 50% more of the spoils.

8. There is no such thing as One Single Ideal marketing message, anymore than there is One Single Ideal shrub in the jungle. What you need is a toolbox of effective hooks that work with different kinds of people. That is the premise of the Swiss Army Knife.

9. Market Research is crucial. In 2004 you could afford to sling mud against the wall. Not in 2010. Ask your prospects the right 3 questions and sort the data right and your chances of success in a startup go from 5% to 50% overnight.

10. Most people now are on the defensive. They’ve shuttered their doors and windows and they’re trying to ride out the recession. That’s just slow motion suicide. Those who prevail have decided to be 21st century alchemists and every single day they’re trying to figure out how to deliver a more awesome customer experience.

1. Conversion rates in free-fall: Your conversions are half what they were 18 months ago. But the clicks still cost more than they did then. What do you do about that?

2. “What are Google searchers actually looking for?” Your market is shifting unpredictably. Prospects who search Google aren’t asking the same question they were asking this time last year. Your market is more complex now and your position in the food chain is different. Have you changed accordingly?

3. There are growing numbers of deeply competitive markets where not one single advertiser is turning a profit. There are some niches where this shouldn’t be terribly surprising; certain parts of the business opportunity market have been this way for years. But now I’m seeing this in other, unexpected places. There is a constant churn of new advertisers and/or “stupid money” that is artificially inflating bid prices. (Yes, even at a time when “stupid money” isn’t supposedly available.) There are all kinds of crazy reasons for this but the bottom line is, you need a way to determine if this is going on – and how to overcome it.

4. Affiliates are hyper-intelligent and they’re everywhere. If you’re not an affiliate, odds are you’re competing with some. If you are an affiliate, odds are you’re competing with a whole bunch of ‘em. (Unless you’re in a market where they all got slapped.) 5% of the affiliates are making 95% of the money. Which group are you in?

5. Google relies heavily on real human beings to review websites. If a Google editor gives you a Quality Score of 1, all the HTML changes in the world will never fix it. If you don’t have an ace Google rep (which generally requires a monthly spend worth of $15,000), it may be impossible to get a straight answer as to why your QS suddenly dropped to 1. But real human beings with $500, $1,000 and $5,000 monthly ad budgets still have to make their businesses work! I’m going to show you how to get around this and play ball with the big boys, no matter what your budget is.

6. When you ask a question, some nameless, faceless person at Google pats you on the head (“Thank you for using Google AdWords”) and sends you a useless, cut-and-paste, non-answer to your question that was written by a committee of recent college grads (Hint: with hundreds of thousands of reasonably funded and fairly ignorant advertisers entering the market on a regular basis, you’re little more than a commodity to Google. Commodity = pawn on a chessboard. Expendable.)

7. Google’s Content Network can deliver gratifying quantities of quality traffic, but to most people it’s a mysterious, money-sucking fog. (Did you know that the colors and layout of the Google AdWords interface are scientifically designed and meticulously tested to vacuum out your wallet while you remain placid, comfortable, unaware?) Only those who know how and where to slice and cross-section their Content Traffic get the rewards.

To know more advance details, well, my colleague Perry Marshall has written a very helpful e-course that you can find out about it here: 2010 Definitive Guide to Google AdWords

I want to show you how to put your Internet privacy completely back in your own control, by doing two simple things. I’ve tested all kinds of things that claim to help you retain control of your privacy online. The results, quite frankly, were generally terrible. Most programs resulted in an unacceptably poor Internet experience… and not much certainty I was doing things a whole lot safer than I was before.

First, I’ve switched my free e-mail provider.

I have switched out of Yahoo and Google over to Hushmail, a privacy-focused e-mail provider based in Canada. The benefit here is U.S. authorities can’t cite the Patriot Act and get whatever they want.

Second, I’m now surfing the Internet securely and anonymously.

I am currently using what I’ve found to be an extraordinary service… from CryptoHippie (www.cryptohippie.com). Long-story short, it makes it so nobody – not Google, not even your Internet service provider, not the government, and (theoretically of course) not a hacker – can track your Internet activity back to you.

This service is not free, but it’s worth every penny. (I tried the “free” and cheap services, but you don’t want them… You surf too slowly to be functional and they’re potentially even riskier than doing nothing at all.)

Third, Internet browsing

One thing you can do is run your Internet browsing program (like Firefox) from a USB flash drive… you know, the little thumb-sized drives that plug into your USB port. You can actually plug these into any computer and start up Firefox straight off of the USB flash drive. You can then leave without leaving a trace on the computer you used. Or, if you’re a bit more computer savvy, True Crypt (www.truecrypt.org) is quite an impressive little security program. But True Crypt really takes security pretty far. Check them out. They’re worth it.

Have you seen The Most Interesting Man in the World?

I’m referring to the TV commercials for Dos Equis beer. They star a rugged-looking, silver-haired man who is always surrounded by beautiful women.

In one version of the commercial, he arm-wrestles a Third World general and releases a grizzly bear from a trap. In another, the narrator relates that even his enemies list him as their emergency contact and that the police often question him just because they find him interesting.

If you are a student of advertising, you know this is a knockoff of David Ogilvy’s famous ad campaign: The Man in the Hathaway Shirt.

If you don’t know the history of this ad, you should.

In Brief: It was 1951. Ellerton Jette, a shirt maker from Waterville, Maine wanted to grow his little business into a national brand, but he didn’t have much money. He had heard about the advertising prowess of David Ogilvy. So he booked a meeting with him.

“I have an advertising budget of only $30,000,” he told Ogilvy. “And I know that’s much less than you normally work with. But I believe you can make me into a big client of yours if you take on the job.”

If he’d stopped there, Ogilvy would have thrown him out of the office. But then he said something that sold the great salesman.

He said, “If you do take on the job, Mr. Ogilvy, I promise you this. No matter how big my company gets, I will never fire you. And I will never change a word of your copy.”

There is a big lesson here. So let’s stop for a moment and talk about it.

What Ellerton Jette did was a little bit of genius, in my opinion. In two short sentences, he changed the mind of one of the most powerful men in the world of advertising. At the same moment, he made himself a very rich man.

Not a week goes by when I don’t get a letter from a complete stranger who sees me as his David Ogilvy. They are direct and to the point. “I know I can get rich if you help me, Mr. Masterson,” they say. “So how about it?”

What makes them think I have the time, if not the inclination, to help them? It never even occurs to them to offer me something in return for what they are asking.

Jette’s $30,000 budget might have put $3,000 in Ogilvy’s pocket. Though it was a paltry sum then and a mere pittance now, at least it was something. But what really cinched the deal was the two promises Jette made.

Going into the meeting, Jette knew he had one chance to forge a relationship with Ogilvy. He somehow understood that Ogilvy, as successful as he was, had two big problems. He worried that his biggest clients would walk away from him. And he hated it when his clients screwed with his copy. So, instead of thinking only of his own goals, Jette took the time to figure out how he could offer Ogilvy something that would be of immense value to him. (This, by the way, is one of many lessons you will learn when you read my Special Theory of Automatic Wealth.)

When Jette made his two promises, Ogilvy realized that he was talking to a businessman who would eventually become a partner. He could see that Jette was a man of good faith who would let Ogilvy be in charge of his marketing. And that he would reward Ogilvy with a lifetime of loyalty.

Now, let’s get back to the story of the Hathaway shirt ad…

After accepting Jette’s offer, Ogilvy spent days doing in-depth research on Jette’s client base. He came up with dozens of ideas. The one he settled on was a campaign built around the image of a distinguished man in a romantic location dressed in a Hathaway shirt. He selected a model that looked like William Faulkner and booked the first photo shoot.

On the way to the shoot, he passed a five and ten cent store where he bought a few cheap eye patches. At the shoot, he asked the model to wear an eye patch for a few shots.

The moment he saw the photos with the eye patch, he knew.

The Man in the Hathaway Shirt campaign was an instant success. The ads were carried in papers around the country, and were mentioned editorially in Time, Life, and Fortune. Before long, hosts of imitators appeared. Other companies ran ads featuring eye patches on babies, dogs… even cows. A cartoon in The New Yorker shows three men looking into the display window of a shirt store. In the second panel, they are coming out of the store, with eye patches on.

And the copy was brilliant. Here’s the first line of the first ad:

“The melancholy disciples of Thorstein Veblen would have despised this shirt.”

Grabbing the prospect’s attention with an entertaining story or idea or photo is essential for any sort of advertising campaign. But you have to do more than that. You have to sell the product. And to do that, you must link the initial sentiment created in the headline with the final emotion needed to close the sale at the end.

2. Twitter will get sold to a larger company for less than the $500 million they turned down from Facebook in 2009.

3. The next rage in pay per click is cookie-ing visitors on your site and then having targeted contextual ads “stalk your prospects” on other sites as they surf the Internet. Jonathan Mizel will cover this extensively in a January 29 teleseminar.

4. By 2014 the newspaper will be drastically different than it is now. Most local papers will have vanished; large pubs will consolidate down to just a few like the New York Times, USA Today and the Wall Street Journal. Sorry, but there’s no need for 200 different newspapers to all be running the same stories from the wires; it’s duplicate content. Meanwhile a minority of high-traffic bloggers will be identified as doing better research with better reporting and less bias than the traditional media.

5. The music industry is headed in the same direction. The bands that succeed during the next 10 years will be the ones who figure out how to connect directly to their audience via social media and direct marketing. Recently I had a conversation with a recording artist whose advance for making a CD has shriveled from $50K+ down to $15K now, because piracy and digital distribution are shrinking the pie. He can’t depend on them to bring him an audience anymore. (Does that sound at all familiar?) Neil Peart of Rush said essentially the same thing, reporting they want to do an album in 2010 but the record company won’t pay for it. The band is now in search of some other mechanism. I predict that membership and continuity models are the future of the music industry.

6. There will always be demand for excellent content, regardless of what happens to TV networks, record companies, etc. Case in point: DVD and iTunes sales of TV series like “24″ and “Lost” are strong, because those shows are superbly produced. I bought the first four seasons of 24, myself. The worst place to be in media is in the “expensive bureaucratic mediocre middle.”

7. I gave away some Amazon Kindles for Christmas this year, and electronic books are most definitely on the rise. Electronic readers are awesome, they’ll become the norm, and the future is not bright for traditional printing and publishing models. However… excellent magazines and books will NEVER disappear. Ever.

8. The traditional HTML website site hand-crafted by an HTML editor and uploaded via FTP is fast becoming a relic, replaced by Content Management Systems and platforms like WordPress and Joomla.

9. There is a small, vocal minority of people that insist that in biology, evolution is entirely purposeless and random. This crowd dominates the current academic scene and cooks up anti-scientific theories like “Junk DNA.” My professional experience in our fast-evolving, “darwinian” online world tells me, evolution is supremely intelligent, NOT random. The intellectual Berlin Wall of 19th century Darwinism will crack in 2013. A 21st century version of evolution is coming, one that doesn’t sneer at religion. I blogged about this last week.

10. Wikipedia will silence its critics. Obviously it’s immensely practical and it’s worked, having entirely replaced the traditional encyclopedia. However, vandalism is a constant problem for some categories. Wikipedia has always had a reputation for smearing controversial people and topics. But they’re cleaning up, and for the most part doing an excellent job. I made a donation for the first time the other day and I think Wikipedia has made a huge contribution to the speed of getting research done. Nothing has done more for bringing the Open Source movement to the masses.