Edition 25

The world halters at a blue screen, cookies (not the baked kind), how elevators are affecting the US housing market, and why helicopters are the dingy equivalent of air travel.

Amazon is reportedly launching a storefront focused on shipping inexpensive apparel and household items directly from warehouses in China to consumers in the U.S. 

Can it beat the Temus and Sheins of the world at their own game? Or a more interesting question: at what cost/benefit; what are the implications on a business level, on a broader economic level, for global supply chains, for the planet? 

When your entire identity is based around speed, convenience, and service, and when your model is largely built on the premise that people value fast over cheap:  What makes you rethink your assumptions? How do you communicate the upside of slower delivery? To what extent do you need to transform your business at the core vs. add or tweak at the edges? How easy is it to reverse or change course?  

Big One’s

CrowdStrike bricked it

Here’s the thing about 8.5 million corporate computers (concentrated in banking, finance and travel)  showing the blue screen of death and much of the world coming to a halt, how bad could it have been?

I’m not the first to tell you that a botched update took down <1% of PC’s on  July 19th, nor am I anything close to a Cybersecurity expert, so I won’t offer thoughts on what technically happened, but it does raise some interesting questions 

In many ways, this is a story of modern life. A story of a modern world built on systems that are interconnected, that are fragile, that companies are entangled with, where management invests in some poorly understood “thing”  to make systems “better”, that automatically updates and all is fine until it’s really not. 

In a world of super-advanced technology and Artificial intelligence and the bewildering array of new possibilities, human foibles like being rushed, making typos, and installing poor checking protocols, can undo everything.  Where people understand THAT things work, but not really HOW they do, where people know their own part of things, but not how they fit together, and where most things are at best black boxes, that people don’t want to peer into too much for fear of knowing what they don’t know, it’s better to rely on past success and to believe in the magic of it all

This isn’t to spread paranoia, or to put a speed brake on progress, but in the same way, we’d be wise to learn from Biological pandemics more than we have, and to have playbooks and protocols and lessons, we should probably predict a mass computer virus in the future and take this as a lesson. Maybe the threat of computers destroying the world isn’t AGI and computers taking over, but a little be of incompetence and a lack of understanding and critical systems crumbling under the weight of code that’s bloated, and decades of patches, workarounds and kludges. 

When computers are everywhere in everything and updated constantly, wonderful and terrible things can happen.

That’s the way the cookie doesn’t crumble 

Google this week finally gave up on giving up on cookies. 

I have strong opinions on cookies that I want to share, with the assumption that I am wrong, and I’d love to know in what ways.

Thing 1- nobody normally cares about them at all.

Until Europe banned them, few people ever thought about cookies. GDPR seemed like a lot of bad solutions to problems almost nobody had. It’s quite reasonable to be scared of being scammed, it’s reasonable to be worried about your email account being overrun with SPAM, and it’s reasonable to not want your personal data to make healthcare more expensive. But the risk of Cookies was generally that people may be shown ads for toasters after they searched them, rather than ads for cars or mesothelioma class action lawsuits.  If we accept advertising is how the internet is funded, is it that awful to have slightly more relevant ads served. 

Thing 2 - Cookies are not that helpful for advertisers

Lots of big Digital Media companies were up in arms about cookies being banned because they said it would make it harder for companies to advertise and make life worse for small companies, this isn’t especially true.

The main use of cookies isn’t to target people but to track how they behave. It’s to TAKE CREDIT for ads effectiveness more than to make ads more effective.  Most digital advertising properties have more than enough data for most brands to target people, targeting can also be done on the context more than the audience. If you want to sell golf equipment you could use cookies, or you could show ads on the Golf Channel, and Golf blogs. If you want to sell laundry detergent, you could advertise where people who wear clothes go online.

Cookies are not especially useful for targeting, they are useful for optimization, where you can try millions of headlines and millions of shades of blue in banners, and choose the combination that has the click through rate of 0.03374 over the ones that only get 0.02875, all while forgetting that the point of almost all ads isn’t to get clicked but to get noticed.

99% of the reason cookies exist is to media companies can pretend with confidence that a tiny banner ad served to you on the 18th of June made you buy a Cadillac, or a bottle of Diet Coke, or fly with Delta, or try Netflix, all of which are clearly quite stupid conclusions.  Most of the time Advertising being placed to buyers, doesn’t means the ads worked, it means your targeting is ratified. 

A downer on elevators

America has fewer elevators than Spain and Italy, and what does this explain in modern America? How come so little new housing is built in America? Why is it often of such low quality and at high costs? The housing crisis has been spreading all across the US, damaging economic productivity and the environment. Underneath it all is a surprising explanation: elevators. 

A fascinating essay about the complex system of rules and regulations around elevator construction in America; the many groups, unions, and regulatory bodies that enforce them; the ensuing mess of contradictions and inefficiencies that spread well beyond the construction industry; and how it erodes the foundation for societal progress. 

Little ones & Curiosities.

1. I’ve always felt people who fly enough to get super high status, don’t need more miles, they need marriage counseling or at least more information. United is doing something interesting by sharing more information about why delays are happening, which may end up being quite a bad idea after all. I guess AI will see more of this sort of “personal communication at scale”

2. This week I found out why helicopters can’t fly that fast and what Airbus is trying to do about it

3. The world’s largest fashion retailer doesn’t make any clothes, something interesting is happening. A decent deepish dive on Shein, Temu, and thin platforms. 

4. Apple still refuses to take advertising seriously and is now working with Taboola, maker of some of the most unpleasant spammy-looking ads ( “hot singles in your area” etc) to sell its ads. I’ve no idea why making ads premium, effective, and relevant, isn’t more of a focus for Apple rather than giving up, again 

5. What if sometimes you could just leave your phone at home? While Dumb Phones become a big thing (relaunched Nokia 3210 anyone?)  someone’s invented a way to make an Apple Watch more useful 

6. Interesting piece on innovation in fake diamonds and companies trying to create false scarcity in a world of technologically created abundance. 

7. Why challenger banks are thriving and what’s the future?

8. Your AirPods might soon come with built-in cameras. 

9. All aboard for a virtual utopia? 

   

10. The worst brand mistakes of the AI era – so far. Which prompts the question: Will AI ever have common sense? 

Announcement

There is less than a month to go until I am on stage at ADMA’s Global Forum in Sydney, addressing some of the key issues facing the marketing industry and how best to prepare what’s to come. If you haven’t already secured your tickets, follow this link to get them today: Global Forum 2024 | ADMA

That’s it for now.
Thanks

Tom