Estimated Prophet

Bernie Madoff With My Money

2008-12-15T18:58:00Z

Just when you think that the news can't get any worse in this world of decaying to non-existent business ethics, along comes the Bernard Madoff story. The ex-chairman of Nasdaq stands accused of defrauding his clients of at least $50 billion in a Ponzi scheme.

A Ponzi scheme typically consists of an investment fund that yields a much higher than normal rate of return. That sounds good but it only lasts until the operation collapses or is shut down. The abnormally high rates of return are not derived from trading; they are paid out of the accounts of new investors. In order to keep running, money has to keep pouring into the fraudulent fund by new investors.

Many individuals and large corporations lost money to Madoff's scheme. Some people claim to have lost their entire life's savings. What I don't understand is how he could do that without conscience. A scheme like that can't work forever. When did he plan to jump off the machine? Where was he going to hide from the world? Is money worth that much?

I do not believe that money is the root of all evil. It has its uses as currency, the oil that liquefies transactions, but that is about it. If one has enough cash to eat, take care of their health, and have a place to live, money has done its job. I agree that it is pleasant to have a bit extra and that it is comforting to have a nest egg. It is enjoyable to have some nice things and to go on vacation, but money does not guarantee happiness or the elimination of suffering. If it did, that would be impressive! So many people think that money is the answer to all of their problems. If we were all more focused on happiness and the elimination of suffering, we would all be happier, fewer people would be so horribly deprived, and we would not have individuals like Madoff to contend with.

The Benefits of a Global Recession?

2008-11-25T18:21:38Z

With all the negative financial news pointing to a global recession, if not a depression, I wonder, what good can come from this collapse in the economy? So many lives will be greatly affected - their usual and expected entitlements gone. Many of us will loose our jobs, nest-eggs and homes. What can possibly be gained by the disintegration of the status quo? If we examine what we have now, we might come up with a few answers.

We have a debt-ridden, stressed-out and tired middle class which consists of many households where both parents must work more than full time jobs in order to stay in their homes and drive their cars just to remain on-the-hook. Healthcare costs are at record prices while the quality of healthcare continually declines. College costs soar at a time when it is more difficult than ever to pick a future-proof career. Record numbers of prescriptions for antidepressants and sleeping pills are being written. Faith in the corporate world is scarcer than ever.

Forty years ago, still intoxicated and profitable from the spoils of World War II, the majority of middle class American households consisted of one parent earning enough to support a family and one full-time parent to raise the children, pass along family values and maintain stability. In the 1960's the average American home could be purchased with barely more than one person's yearly salary. It is easy to see that our way of living has lost quality and simplicity.

The downturn we are now facing may shrink the world. Perhaps the large corporations won't all get bailed-out. Maybe smaller, more ethically responsible lifestyles and businesses will succeed by their ability to be lean and free of greed. Wouldn't it be nice to once again walk to the corner variety store for a box of nails instead of getting into your car, wasting gas, driving to Home Depot, just to experience a dehumanizing experience that takes four times as long? And wouldn't it be nice to hear the cashier say, "Hi, how are you today, Bruce" and mean it?

A shrinking world economy will consume less energy, cause less destruction to our rain forests and less emissions into our air. Global warming will slow. Our lifestyles will suffer but our planet will be able to take a bit of a breather from its usual high pace of abuse. Maybe if it all slows down, there could be some rational thoughts on what we really need from our planet and our lives. Perhaps our thoughts on energy may become less economically based and self-serving. Maybe we should try to spend this difficult time to regroup and repair our world and maybe we can help each other get through this together.

How Can a Business Grow and Preserve Its Brand?

2008-10-20T16:04:55Z

As a company grows, several factors emerge that make it challenging to maintain the brand essence that has contributed to that growth. Let's examine the smallest of businesses-the sole proprietorship-to see how this develops. Our example is a service business owned and operated by a craftsman who is passionate about his work and who has become a highly skilled worker in his industry. He wants to increase output but has no time of his own left to spend so he hires someone. If the owner and worker produce the same amount of work and have the same amount of direct client exposure, the brand essence risks 50% dilution. How can the owner prevent brand leakage by the expansion? Even with the most efficient hiring system, the new worker will alter the brand by the way he communicates with clients, by the quality of the work he produces and by the customer service and support he provides.

Brand essence reflects the personality, quality and homogeny of a company. It is the cornerstone that makes a company unique and can provide the compelling reason that consumers select one company over another. It is the solid platform that enables advertising campaigns to generate sales on a continuing basis. If the brand falters, the company falters. One reason that companies fail where they once excelled, is that they stop the behavior that caused the excellence in the first place. This can be seen in customer service disintegration and from a breakdown in corporate culture and spirit. It can be caused by unrealistic growth targets based on bottom-line figures instead of organic growth techniques.

The problem magnifies in medium and large businesses. Look at how many companies grow by acquisition strategies. What happens when a 400 person firm is purchased by a 1,000 person firm? How is it possible to grow by 40% and retain any brand essence? Even if the parent company was purring along with solid branding and great corporate culture; how will that brand survive while being watered-down? How can corporate culture survive in such turmoil? Look at a law firm that has just acquired a smaller shop to provide a broader range of services. How can an attorney in a parent firm risk referring one of his oldest and most valued clients to an attorney he has no track record with because his firm now offers a new area of service?

Maybe corporate growth needs to occur at a much slower rate than the business world has come to expect. Maybe a 50-person shop can only grow by one person at a time instead of 20. This approach might increase quality instead of just quantity and serve to build trust in a brand rather than squander it.

Hey Mom, What's For Dinar?

2008-10-13T00:24:26Z

The Iraq Stock Exchange, located in Baghdad, is up 25% this year. It is up nearly 40% since September! The ISX index has been in existence since 2004 and open to foreign investors since 2007. The national currency of Iraq is the dinar. It has been gaining on the US dollar which trades for just under 1200 dinars.

The exchange is comprised of 95 companies and operates without computerization. Trading is recorded and updated using whiteboards and erasable markers. About 97% of the activity is domestic. At the ISX website you can see photos and read more about the companies traded.

Currently experiencing the greatest gains is the hotel sector which is comprised of six hotel stocks. The industry is taking off because of all the foreign contractors needing room and board. Their banking sector is also doing well as stability returns to the country.

Does anyone else see the irony?

I Didn't Think I Needed a Depression to Make My Point But...

2008-10-06T20:47:21Z

When I started this blog in August, I commented that a company's sales message needed to be real and that marketers needed to build consumer trust in their brands. I spoke about false claims concerning corporate products and services and underhanded sales tactics. Boy, have we come a long way since then!

The world economy stands on the brink of collapse and not a day passes that we don't hear the word, depression. In my third blog entry I said, "Two important keys to business success are honesty and ethics. A company that lies will fail somehow at some point. Maybe it won't go out of business, but the bill that corruption delivers must eventually be paid." I am sad to say that my point has now been solidly proved.

It is time to rebuild the broken paradigm. Businesses need now, more than ever, to embrace ethics, in their mission statements, the way they treat their workers and in their advertising and marketing efforts. If you agree with me that consumers were cynical before, what do you think they are now? The time has come to return to our roots and give true information to the people, about our companies' value in the marketplace, in the news we listen to and in all communications we have with our fellow human beings.

If a company can survive this wave and utilize truth in advertising, they might just become one of the next giants of industry.

WaMu-WhyUS-Welcome to JPMorgan Chase...

2008-09-29T11:04:38Z

Go to www.wamu.com, the bank that had the most inane advertising of all time; the bank that targeted minorities and low-income people into, amongst other things, bait-and-switch mortgages. Their home page already says, "Welcome to JPMorgan Chase." If you really want a hoot, click on the link that says, "About WaMu" and you can read about all the wonderful things they have done for the world in a section entitled, "The WaMu Difference." My favorite point that they make here is that they, "Introduced the easiest, paperless online account opening process in the industry." Now they can add moneyless to that list.

Now the nation's largest savings and loan institution has been shut down by the government-another institution that seems wobbly these days. How much bad debt can the U.S. government take over? And adding fuel to the fire, Alan Fishman, who was CEO of WaMu for only three weeks, is set to walk away with more than $18 million in salary, bonuses and severance pay. Let's see...how do you think that money will be repaid? That's right, it will fall upon the shoulders of US-the already near extinct middle class-the people who used to be the heart of this country.

The subject of this young blog is ethical advertising but it is getting increasingly more difficult to find corporations that are viable candidates. There is an ethical abyss in this world where corruption is arguably at an all-time high. How can it be fixed? Now that is a question whose answer is worth $18 million dollars.

What Do Jason Giambi And AIG Have In Common?

2008-09-18T15:49:47Z

I was overcome by the irony while watching the New York Yankees game on the evening of Tuesday, September 16, by the juxtaposition of Jason Giambi and AIG.

First baseman, Giambi, hit his 208th home run as a Yankee, moving him into 10th place on the team's all-time list. Giambi has admitted to using steroids and human growth hormone to improve his performance. His admission was no surprise considering the abundant usage of drugs in pro sports and is a terrible example to set for the youth who seek professional athletic futures.

On the same day, the US government agreed to an $85 billion bailout of AIG, the country's largest insurance company in terms of assets. They have been loosing tons of money mostly because of the mortgage meltdown. Both Merrill Lynch and Lehman Brothers bought large amounts of insurance from AIG seeking protection from their exposure to the bad mortgage market.

Here's the irony. Giambi's record-breaking home run sailed right over the outfield fence precisely above the AIG advertisement in Yankee stadium. Maybe AIG should go on steroids for a while like Giambi did. Maybe Giambi should become a spokesman for AIG. My point is that both steroid use and greed in the financial markets are examples of poor ethics. Unless the business ethics of this country and our world improve we are in for a really bad ride. The big picture has become quite twisted.

What Does Ethical Advertising Mean To Consumers?

2008-09-12T17:45:29Z

In my previous entry I spoke about the ethical advertising agency process in terms of how it affects clients. This entry is about what it means to consumers. The term ethical advertising is almost an oxymoron. Do you know the old joke about the world's shortest book? It is a list of all of the truthful ads that have been created.

There is nothing wrong with offering up products and services, essential or non essential, for the world to consume at their discretion. But, and this is a really big but, not when the products or services are known to be harmful to the health of the consumer, like cigarettes. And not when the products or services are known to be defective like several of the prescription NSAIDs. And not when misrepresentation is involved like in the automotive industry. It is not okay to demonstrate the safety of a car by artificially reinforcing it with steel and then showing impact videos.

Ethical advertising can also take on other tones that are more personal and may reflect the beliefs of the agency owner. For instance, my agency will never accept the business of certain fast food restaurants. It has been proven that many fast food establishments serve extremely unhealthy food to a culture that has little time to spend on their eating habits and is suffering from excessive new cases of diabetes and heart disease. Many fast food restaurants have also caused excessive cruelty to animals in order to bring a more profitable product to market.

Wouldn't it be nice to be able to view an ad and think that you could believe it and in the good reputation of the company behind it?

What Does The Ethical Advertising Process Look Like?

2008-09-05T15:06:01Z

Traditional advertising agencies make most of their profit by placing media on which they earn 15% commission. The more a client spends on media the more profitable the agency becomes. Another way agencies make money is through creative fees associated with projects such as website development and ad campaigns. The more projects carried out--the more profit for the agency. This model creates a conflict of interest between agency and client because, even though a client may become more profitable through the use of media and projects, the agency always profits. Thus, most agencies have agendas that are not always in alignment with their clients' profitability objectives.

I believe in a different model. Ethical advertising involves the integration of marketing consulting and business development strategies that lead the way to selecting the most profitable advertising products for the client. The client retains the agency to review their business goals, help plan growth, obtain quality market research, and gain awareness of competitor's marketing efforts. A mutually agreed upon monthly retainer fee effectively places the agency on the inside of the client's business and commits the agency to generating profit not only expenses. The agency then creates and is compensated for advertising vehicles on a per project basis including standard industry commission. If they fail to make the client more profitable within the term of the contract, they can be dismissed. Under this model, both companies are on the same side and this can to lead very long, trusted and mutually profitable relationships.

Next Time You Search Start On Page 20 And See What You Get

2008-08-28T16:05:03Z

The world of search is an interesting one. According to statistics, more than 90% of search engine users will sooner perform a new search with different keywords than go beyond page one of results. I find this very intriguing and disturbing at the same time. The fact that page one of the SERPS (search engine results pages) is most searchers' entire universe means that they are ignoring millions of possibilities. I think the reason for this is that we have all become so impatient and anxious that we want it NOW even if it isn't perfect. This part of the problem with search is caused by our society and conditioning. Knowing this to be the case, I sometimes begin my searching on page 20 of the SERPS just to keep it random and I always go beyond page one's results before conducting a new search.

The other angle on this problem is that the ability to appear on page one is sometimes a function of natural appropriateness, but more often, it is a function of search engine optimization (SEO) techniques put in place by an outside advertising agency. I am not saying this is evil or unethical advertising when done utilizing 'white hat' or approved techniques. I am merely saying that SEO is a form of advertising and that number one placement is a function of economics and skill rather than an intrinsically meaningful one to a searcher's best interests.

You Have To See Crazy People

2008-08-22T20:24:23Z

Released in 1990, the movie, "Crazy People" starring Dudley Moore, is about an advertising executive who suffers a nervous breakdown and winds up in a mental institution. He starts an ad agency during his stay-turning patients into his creative team. The agency only designs ads that are 100% honest and winds up becoming the hottest agency in the world--for a time. Their clients include Volvo, Jaguar, and Sony amongst others. One magazine ad they produce for a horror film contains copy that states, "Paramount Pictures presents 'The Freak.' This movie won't just scare you, it will fuck you up for life." Besides providing some of the funniest ads I have ever seen, the movie makes a great statement--Honesty works and is fresh while the same old stale lies are not working anymore.

This movie was made well before the internet revolution and now with web 2.0, consumers are smarter and more skeptical than ever. Word can spread globally in seconds and with so many online communities, consumers can exchange personal brand experiences in an effective manner. If all companies started telling the truth in their advertisements, the public would embrace them or simply realize that they don't need the product or service being offered with no harm done. Although Crazy People is an exaggeration of my point, please watch it and see if you agree. It will certainly make you laugh and might make you see my point.

How To Build A Profitable Website

2008-08-16T14:04:26Z

On June 18, 2008 Bruce Kersten of Savant Creative Group was interviewed by Tim Healy, host of The Profit Express and owner of Healy Success Solutions. Tim's mission is to Empower Your Sales From Prospect To Profit. He offers sales team training and sales performance coaching and can be contacted at 631-244-6090. The show airs weekly on Wednesdays from 6:30-7:00 PM on 88.7 FM WRHU.

Topics of the interviewed covered: what to consider before having a website built, how to market a website and how to choose a search engine optimization company. You can listen to an edited podcast of the interview by clicking here.

Ya Gotta Tell The Truth

2008-08-13T20:20:25Z

Two important keys to business success are honesty and ethics. A company that lies will fail somehow at some point. Maybe it won't go out of business, but the bill that corruption delivers must eventually be paid. It might be at the bottom line, but less obviously, it might be at the corporate culture level -- having disenchanted workers. This can also result in 'shrink'. Shrink is the inventory that 'disappears', sometimes because employees are taking it. It is impossible to be a dishonest business owner and an honest citizen and family man at the same time. Life is life throughout, regardless of profitability. I came across a great article on the top 10 principles for positive business ethics that is very worthwhile reading. Because of poor business ethics, Mr. Philip E. Humbert states that, "An unhappy customer complains to an average of 16 people." With competition in business being global, what business owner can afford that? Keep your customers happy. Keep your workers happy. Keep your life happy.

Teach A Fish To Eat...

2008-08-10T21:13:14Z

Even though many companies sell similar goods and services, putting diligent marketing research time in can help solidify what attracts repeat customers. It may be customer service, quality of product, store environment, brand experience or one of many other variables. As long as these answers are grounded in an ethical base, businesses can increase their sales through niche building, spreading the word of what is already working to more of the demographic being satisfied using organic and common sense methods. Adaptation not lies and false promises, should build businesses. The entire evolutionary world behaves in such a manner. As several species vie for the same food in an ecosystem, it is only the most adaptive and specialized that survive and prosper. The fish of Lake Malawi, one of The Great Lakes in Africa, provide a good analogy. This lake is home to more species of fish than any other in the world. Many of the different fish appear to be almost identical, but in order to survive; they have developed extremely specialized differences. Some of the species only differ by the shape of their jaws. This enables them to eat algae from different areas of rock in very close proximity of each other. One jaw won't quite fit in to collect food from a certain shaped crevice, yet another 'cousin species' will have one that does.

Yikes! Another Blog About Advertising, Marketing and Business

2008-08-03T12:40:59Z

Why do I want to publish this blog when there are so many out there already? I think that much needs to be explored when it comes to advertising, marketing and business development. Most would agree that advertising is not working anymore, or, at least the way it used to. Years ago, there were several main distribution channels for advertising, like when most television viewers had only about six channels to watch. Now the average viewer has hundreds of choices. TV advertising has become diluted or deluded to say the least. We are bombarded by thousands of media ads from the time we arise to the time we go to sleep each day. We have become desensitized due to overexposure as well as cynical because of so many false claims about products and services and underhanded sales tactics like bait and switch. The truth is that it is not working for marketers or consumers, so, what to do? I think the answer lies in ethical advertising that is not built on lies, but on truths. The value of a company's sales message should be real. Advertising should serve the consumer and marketer alike by clearly defining the value offered. If the offer truly solves a consumer's needs, perfect. Think about it this way. If a marketer can accomplish this, wouldn't the consumer develop trust in the brand, possibly return with more business and even recommend the marketer to another?