Technology sector macro issues perspective with Reid Hoffman

This video stands in sharp comparison to the Ayn Rand-loving frat-bro culture that seems to infect technology  sector companies based in Silicon Valley.

Hoffman is cut from different cloth and represents a slightly older generation in the technology sector who pioneered the dot.com era.

He grew up in Berkeley, back when the technology sector was more hardware focused and Silicon Valley actually made micro-chips. Back then HP and Agilent made measurement equipment in the Valley and it was the centre of the cold war missile technology. The east coast from IBM in New York State to the Boston corridor represented a worthy adversary of Silicon Valley. The technology sector only opted to have Silicon Valley as its home during the move to personal computing.

Hoffman worked at Apple on eWorld – an early way of connecting Macs to the nascent public internet. He founded a prototype-social network and was part of the PayPal mafia before founding LinkedIn.

Reid Hoffman offers a more thoughtful considered viewpoint on the future of the technology sector.

How Technology is Shaping the Future of Human Society was filmed by the Aspen Institute.

ICYMI | 万一你错过了| 당신이 그것을 놓친 경우

Naughty List – Secured.fyi – Alpha – great simple checklist for n00bs. The answer per platform needs more nuance

Justice Dept. Revives Push to Mandate a Way to Unlock Phones – The New York Times – Clipper Chip style bullshit that is bad for consumers and governments since it will be broken and used by criminals and state actors

Sex Workers Say Porn on Google Drive Is Suddenly Disappearing – Motherboard – don’t assume that the contents of your Google Drive hasn’t been thoroughly examined by Google. Adult entertainment is merely the canary in the coal mine for privacy.

Is Facebook Really Scarier Than Google? | Nautilus – worthwhile reading about the effect of Google – of course they both have an impact otherwise you wouldn’t advertise on it. The question needs to be does the utility justify the impact? I think search has a better case than a social network, but both have merits

The unparalleled joy of writing with a fountain pen – and five beautiful pens to inspire you – Country Life – Among the obituaries of a former Conservative Minister a few years ago, there was one delightful snippet. A line in The Daily Telegraph described how, when she received the letter from Mrs Thatcher appointing her to the Lords, Lady Blatch initially believed it to be a hoax, because the letter was signed in Biro and she had been ‘brought up to believe that nobody who matters uses a Biro’.

Why Nothing Is Going To Happen To Facebook Or Mark Zuckerberg | Buzzfeed – consumers don’t care enough

China’s Huawei Technologies reshuffles board for first time since 2012 – I presume the reason why Mr Ren is getting back behind the wheel is that overall and smartphone revenue figures for 2017 was Huawei’s slowest growth in four years. I am not convinced that  premium products will be the way forward when they are locked out of the North American retail system. I am also not sure why the management team at Huawei Mobile Devices hasn’t been refreshed

Cloak and Data: The Real Story Behind Cambridge Analytica’s Rise and Fall – Mother Jones – probably the best account yet by the media

Restricted By YouTube, Gun Enthusiasts Are Taking Their Videos To Pornhub | NPR – Pornhub is starting to turn into a libertarian YouTube

Has Marketing Gone Too Digital? | Mediapost – a good read, send it to your clients and your agency folk

Cigarettes are the vice America needs | FT Alphaville – Cigarette smoking is essentially the anti-Facebook. While Facebook is a fundamentally misanthropic venture that pretends to be a community, smoking is a community activity for people who pretend to be misanthropes.  The activity itself is fundamentally pro-social! It gives people reasons to interact with strangers (“got a light?”). And since it was banned indoors — undeniably a good choice — it gives people a reason to go outside and make idle small talk, all while pursuing a common activity. And unlike alcohol, cigarettes alone don’t often lead to property damage or missed days of work (paywall)

China’s young consumers are snubbing foreign brands amid growing national pride, says Credit Suisse | SCMP – this should share the shit out of MNCs

Google has reportedly acquired Lytro, the Leader in Light Field Imaging Technology for Photography and VR Content – interesting, Apple had a patent licence from them

Interpublic Upgrades U.S. Ad Spending Growth To 5.5% This Year – which looks much more like what I would expect the advertising market to be with the Winter Olympics and forthcoming World Cup and an ok global economy

Building for the modern web is really, really hard | O’Reilly – average website clocks in at 4MB with 100s of elements including 3rd, 4th and 5th party based interactions – which also explains page load times – and slow AF ad related technology such as trackers

Mobike to charge bad riders more | Techinasia – a la eBay, Uber etc

Study: Smart Speakers are Changing the Way We Select Products – interesting how this is impacting retail. FMCG brands in particular should be really concerned as this is far beyond what supermarkets could do with dodgy shelving layouts and look-a-like private label brands

The Valley of Death: the students vying to be millionaires | Telegraph – In 2015 Oxford, the UK’s number one university for research, produced four spin-outs. Not per professor. That was for the whole university. The situation was not better elsewhere. Data on British university spin-outs is not in any publicly available league table. But it exists, via what’s called the HE-BCI survey (it stands for Higher Education – Business and Community Interaction). For 2015-16, Cambridge University recorded a total of two spinouts in the HE-BCI survey. Imperial College London, another of this country’s most vaunted research universities, listed three. Of 160 institutions, 59 officially produced no spinouts at all.

Does it Really Matter if James Jebbia is Not a “Fashion Designer”? The Fashion Law – Supreme is an anti-consumerism consumer brand. Its now going into luxury baskets, it doesn’t have much room left in the hype beast space though

Alex Stamos, Facebook Data Security Chief, To Leave Amid Outcry – The New York Times – Some of the company’s executives are weighing their own legacies and reputations as Facebook’s image has taken a beating. Several believe the company would have been better off saying little about Russian interference and note that other companies, such as Twitter, which have stayed relatively quiet on the issue, have not had to deal with as much criticism

Our mission to buy a fake Rolex on Facebook reveals how the company is playing host to countless criminal enterprises | Business Insider – only a matter of time for this story to be written. You also have a similar problem on Instagram

Millennials: you will not be quite so special in the ‘futr’ | FT – could it be that millennials, the most scrutinised, criticised and debated generation of our time, were not that special any more? “Millennials are still important as a customer,” Ms Ganatra told me later. But there is now a “millennial mindset” that has nothing to do with age, she said. In other words, millennials may have been the first generation to have grown up in a digital world but the rest of us are catching on fast. People of all ages are now so used to shopping with a click or talking to a chatbot that retailers need to think about the needs and desires of all their customers, not just those born between 1981 and 1996 – or an artificial construct in terms of their digital uniqueness

 

Black flag operation Facebook advertising?

In the wake of Brexit and the election of Donald Trump there is an increased focus on Facebook advertising. I would have thought that the one I was served the other day would have been the equivalent of a three-alarm fire for the advertising team?

Black flag advertising

I didn’t have the presence of mind to look at why I was targeted, my priority was to take a screen shot.

Mercedes’ China Syndrome

China Syndrome definition: a hypothetical sequence of events following the meltdown of a nuclear reactor, in which the core melts through its containment structure and deep into the earth. A term the American’s used to imply an accident so bad that hot nuclear material burnt through the centre of the earth and out the other side (to China). It seemed an appropriate metaphor of Mercedes recent marketing debacle.

A seemingly shallow innocuous social media post by Mercedes Benz managed to stir the passions of Chinese netizens. Many of whom broke Chinese law to jump the great firewall to complain on Instagram. A corporate meltdown ensued.

mercedes benz

When one looks at it from a brand marketing point-of-view two questions immediately pop up?

  1. Why were Mercedes doing filler motivational quotes in the first place?
  2. What does Chinese exceptionalism mean for brand marketers around the world?

Motivational quotes

Motivational quotes a tried and trusted tactic for social media marketers. But that doesn’t mean that they are any good. It really depends on what job the post is supposed to fill.

I can’t imagine that it would have driven a lot of sharing (controversy nonwithstanding) or greatly expanded the reach of the Mercedes Instagram account.

Motivational posts can performs really well if you are measured on engagement particularly in markets like the Philippines,Myanmar and Thailand. In the case of Myanmar, brand content serves as entertainment due to an under-developed media industry. Again I don’t know why the team would have been focusing on markets like this?

Where they looking to tap a wider audience and position Mercedes as a brand that one would aspire to own? In developing markets where the urban middle class drive Toyota its a possibility if they were focusing on Mercedes as a luxury brand (S-class, SL-class, GT, GLS and G-class models certainly are).

However those posts would be less likely to appeal to serious car buyers or petrol heads. Mercedes has a rich heritage in car-making and motorsport that it could have drawn upon instead.

I imagine the problem comes down to the way goals were set for the Instagram account. They may have been lacking a clear view of who they wanted their audience to be. I don’t have any insider insight so that’s about the best that I offer.

The Dalai Lama is a divisive figure. The Chinese view him as a ‘separatist’; whilst in the west he is respected as a religious leader and he comes across as an affable old man in media interviews. They view Tibet as an indivisible part of China.

The quote was published within a day of American motor manufacturer Dodge being criticised for using the words of Martin Luther King in an advert. A curious social media operative should have looked at the Dodge debacle and thought ‘what does this mean for my brand’? It doesn’t seem to have occurred and that is on the social media team involved.

Some times it is worthwhile going back to basics:

  • Treat others like you would like to be treated yourself
  • Don’t discuss politics or religion in polite conversation
  • Put three times as much effort into listening, as you do speaking

Chinese exceptionalism

China is an ascendancy, in the same way that a post war-era US saw the rise of US influence around the world. President Xi  echoes Chairman Mao’s China has stood up quote. His power hinges on two things:

  • The legitimacy of the party which is deeply linked to its ability lift Chinese people out of poverty.  From the Deng era onwards China has lifted over 650 million people out of poverty. It’s essentially the Chinese Dream. The ongoing crackdown on corruption in the party is linked to the legitimacy of the Chinese Dream: do what we ask and things will continue to get better in a step-wise manner. You maybe poor at the moment, but your life will continue to improve
  • Chinese nationalism: China going back out and taking its place on the world stage. Prior to the mass production of the industrial revolution; China accounted for roughly one third of the world’s total economic output. It slipped back as the industrial revolution took place in the west. Its current economic growth is seen by the party as China’s journey to regain its place

This means that a constituency of the Chinese population and the party is extremely sensitive to perceived slights, whether they were intentional or not. Chinese sensitivity to the world accelerated since 1999 when the US air force managed to bomb the Chinese embassy in Belgrade by accident.

I don’t think anyone believes that the Mercedes social media team thought about ways that they could offend the Chinese people – on a platform that is unavailable in China. It was negligence rather than malicious in nature.

Timeline

February 5: Mercedes posts a filler motivational post on Instagram with a quote from the Dalai Lama.

Despite Instagram being blocked in China, Chinese netizens became enraged about the post.

February 6: Mercedes apologises on its Weibo account. Chinese netizens are still angry and want the apology to also run on Instagram. Mercedes is between a rock-and-a-hard place. Pissed off Chinese netizens, or pissed off netizens from the rest of the world

February 7:  A Chinese government spokesperson comments on the apology, with a statement that said in diplomatic language that it was prepared to get medieval on Mercedes Benz if necessary

February 7: Senior management in Germany send a letter of apology to the Chinese ambassador in Germany.

February 8: Second apology is reported on Xinhua. Xinhua is the Chinese government’s wire service think AFP or Reuters.

February 9: People’s Daily – a government newspaper often considered a herald for the Party describes Mercedes as an ‘enemy of the Chinese people’

February 13: Mercedes-Benz (China) Automotive Sales Co. will recall 1,886 imported S-class, C-class and GLC sport utility vehicles (SUVs) manufactured between July 2016 and December 2016, according to the statement. Its joint venture company Beijing Benz Automotive Co. will recall 18,893 C-class and GLC SUVs manufactured between October 2016 and February 2017. These recalls don’t seem to be mirrored in other countries, which is unusual for the 1,886 imported models – it might be a coincidence…

The constituency

The main critics of Mercedes seem to be particular faction of it young people with extreme nationalist tendencies called 愤青 fenqing (said fen-ching).

They are a diverse group in terms of beliefs, but a simple view would be to think of the nationalism of Britain First supporters, but with Chinese sensibilities. They tend to come from lower tier cities and will have been less exposed to world beyond China.

Their antics are curbed through censorship and further actions when it suits the Chinese government. It is rarely desirable to allow the fenqing enough space to run unchecked.

When China was unhappy with South Korea; it chose not to curb protests and damage against Korean business Lotte by fenqing. Lotte owns the golf course on which the THAAD anti-ballastic missile system was placed to stop a North Korean nuclear attack on the South.  Chinese demonstrators closed Lotte stores throughout China, cause a huge amount of damage and forced Lotte to withdraw completely from the Chinese market. Those stores that weren’t picketed by protesters were closed down by Chinese local government department for (non-existent) fire code violations and fined over breached in advertising regulations. Chinese tourists boycotted Korea and Korean stores.

They will have been supplemented by students living outside China whilst attending foreign universities.

Context

One has to consider Mercedes faux pas in context. It came on the back of apologies by Delta Airlines, Zara and Marriott Hotels when netizens realised that Taiwan and Hong Kong were treated as different countries on these websites.

In Marriott’s case it was an loyalty programme research survey that caused the controversy.

Posts like this one on Instagram have the comments section stuffed full of protests from overseas Chinese and their mainland brethren who have jumped the great firewall.

The government forced Marriott to close its site and app in China. In addition Marriott’s social channel went dark AND the company made an apology aimed at a global audience.

Their western social channels went dark for four days to a week depending on the channel. The implication in an article in China Daily the Chinese government ordered a shutdown GLOBALLY on Marriott’s social channels as part of the punishment.

“To regain confidence and trust, the first thing is to admit the mistake, then fix it, and it would come back slowly as we prove we really mean what we say,” Smith told China Daily in Shanghai on Wednesday, one day before the company’s digital platforms are scheduled to be back online.

What is conveniently forgotten is that the international websites of Chinese state-owned companies like Air China made similar mistakes.

Why did Mercedes apologise?

Chinese netizens weren’t going anywhere. They are angry and persistent.

Implicit government pressure, here is a quote from a Chinese government press conference about it

Q: According to reports, on Monday, Mercedes-Benz quoted the Dalai Lama in an English language post on Instagram. Yesterday, the company apologized and deleted the post. Was this at the behest of the Chinese authorities?

A: I have seen relevant reports. To acknowledge your wrong and fix it is the simplest truth, universally accepted both in China and in other countries.

I want to stress that over the forty-year course of reform and opening-up, the all-around cooperation between China and foreign enterprises has not only boosted China’s development, but also benefited the latter. As the 19th CPC Congress ushered in a new era for China’s endeavors in various causes, a China in the new era will be more open and more confident. We will continue to pursue cooperation with foreign companies, and we are also ready to share China’s development opportunities with them. However, it is needless to say that they must observe some basic rules.

That’s diplomatic language for expect a beasting from the Chinese government and Chinese people for any perceived slights.

Mercedes-Benz probably looked around at what its peers with major exposure to the Chinese market have done. Marriott being the most obvious analogue. Marriott’s capitulation to the Chinese government was complete and global – even at the risk of provoking the ire of Donald Trump supporting Americans. They were one Donald Trump tweet away from American First outrage over their capitulation to China, but it was a risk that they were prepared to take.

It is worthwhile remembering that Boeing had a billion dollars wiped off its market value thanks to Donald Trump complaining on Twitter about the price of a new Air Force One plane. He has also shown an ability to mobilise his political base via social media.

Conclusion

The takeaway for many brand marketers in multinational firms, regardless of where in the world that they work is that they are the Chinese government’s pawn and they best get used to it. Chinese buying power has given the Chinese government the kind of exceptionalism that was previously only available to the US; then mostly because that was were many multinational companies were headquartered.

One has to wonder how long western brands will survive by bending to the will of the Chinese government when it wants its homegrown brands to expand globally?

Contrast Marriott and Mercedes’ behaviour with the rage-filled tone Huawei takes, particularly  in the US in the face of government criticism or negative partner actions.

More information
Use of Martin Luther King Jr. speech in advertisement causes controversy at Super Bowl | The Independent
China inflicted a world of pain on South Korea in 2017 | Quartz
China asked Marriott to shut down its website. The company complied | Washington Post
Statement from Arne Sorenson, President and CEO, Marriott International, Inc.
Marriott announces ‘rectification plan’ to regain trust | China Daily
Doing business in China: Politics is still in command | HKEJ Insight
Foreign Ministry Spokesperson Geng Shuang’s Regular Press Conference on February 7, 2018 – Chinese Ministry of Foreign Affairs
Daimler apologizes to China for quoting Dalai Lama | Xinhua News
Mercedes-Benz to recall 20,779 cars in China | Xinhua
Donald Trump just took a shot at Boeing in Trump Tower | CNBC
Huawei fed up, tells US critics ‘shut up’ | ZDNet
The CEO of Huawei Totally Went Off Script at CES and Ripped U.S. Carriers After an AT&T Deal Fell Apart | Entrepreneur

Instagram: we need to talk about fakes

I’ve noticed these kind of accounts popping up on Instagram over the past few months.

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Interesting shots probably re-grammed from the brands marketing materials or a magazine shoot. Going through to the site….

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Great site design. Only the URL and the prices give it away as fake goods. For those who aren’t as sophisticated Facebook now has its classifieds section. Think Gumtree but inside Facebook.

Here’s a second example, this time replicas of BAPE’s iconic shark head hooded top.

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This time they are selling the products through Amazon merchants accounts

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Instagram has a lot of heat from brands, but this could turn very quickly when they realise that Instagram can be a facilitator of fake products sales. Look at how Alibaba and eBay have been vilified in the past.