To the first question, it is useful to know that there are two competing theories about what a corporations’ leaders motivations should be. On the one hand, a school of management established by Peter Drucker argues that (in his words) “There is only one valid definition of a business purpose: to create a customer.” Under this managerial view, making a better product, creating a better experience should be the top priority. On the other hand, many corporate executives have come to believe in the arguments laid out by finance professor Michael Jensen and Dean William Meckling of the Simon School of Business at the University of Rochester. Their theory argues that a corporate CEO’s number one goal should be to maximize shareholder value. (You can read much more about this clash of ideas in “The Dumbest Idea In The World: Maximizing Shareholder Value” by Steve Denning over at Forbes. Definitely worth the read.) The problem that arises from this point-of-view is that there are ways that a CEO can increase shareholder value without concerning him/herself with bettering a product. Most of these involve managing information in some way. The first method is that CEOs can manage the expectations of analysts who make investment advice. Exuberance has been shown to be able to increase stock value. This, to paraphrase Roger Martin in Fixing the Game, is like the coach of a football team managing the spread for the bookies instead of trying to win the game. A second method is to use advertising and product placement in media to manage brand recognition, and that part is important because of what psychologists call the recognition heuristic.

In Psychological Review (Vol. 1, No. 9) Daniel Goldstein and Gerd Gigerenzer put forward a simple mathematical function that fairly accurately predicts subjects’ decision-making (in cases with two options). The predictions indicated that, in very general terms, individuals will choose something they know over something that they are unfamiliar with. They call this decision process the recognition heuristic and speak directly to the fact that information transmitted via media has the advantage of appearing before an individual multiple times. What this accomplishes is to make an individual estimate that they have interacted with a brand more often than they actually have, increasing its recognition, and the likelihood that the advertised product will be chosen over the lesser or un-advertised.

Where corporations often run into trouble (Hi, RIM!) is that they come to rely on these informational crutches. Playing the spread becomes more important than winning the game. Talking up unproven projects in development becomes more important than actually shipping. Any advantages that a collection of skilled people brings begins to deteriorate as money is funneled away from design and development and into other channels better used for support, and talented people leave. If there’s one thing that annoys talented engineers and designers, it is seeing that the focus of a company is on something other than what is being produced. After a while, a firms lose the ability to innovate even when executives decide to change focus, because the talent needed to steer the ship has jumped ship. As the vaunted Steve Jobs might say, “Real artists ship”¹. In fact, Apple makes an exceptional example in this respect, reducing their advertising budget when compared to their revenue growth, and spending a fraction of what other technology companies spend while dominating multiple markets because of the effectiveness of their design and engineering. Managing shareholder expectations and engaging advertising are important aspects of corporate management, but they are no substitute for creating a product or service that compels consumers to want to engage with it. You can and probably should advertise, but don’t be surprised when consumers get wise to the fact that all you do is advertise.

Seriously, advertising, you’re, like, everywhere. I myself even engaged in a bit of billboard liberation when a Comedy Central (my favorite channel, btw) ad started talking to me at the urinal. Something snapped and I dug the electronic voice box out of the ad and through it in the toilet. Enough! Advertising jumps around in banner ads more than a five-year-old after a 20oz coke. And I really think that’s largely due to the fact that ads are just a fading fad. When the whole world’s information is at folks fingertips and you’re trying to get a message to them, what’s the use in irritating them?

It strikes me that advertising got spoiled during the good ol’ days of linear media where every fifteen minutes on the (free) radio or the free (television) it got to yack at us. But when media goes nonlinear like the web, you just can’t afford to be that obnoxious. Advertising needs to get its class back, like The Deck or like BMW films. Class, advertising! Class! You can talk to people without shouting, you can persuade people without lying. But in the long run, business is still going to have to get back to basics and start trafficking in real information; not shinola.

With people more and more saturated with advertising messages that scream about lifestyle and how to be cool, it’s actually refreshing to run into an ad that looks as though it belongs on Saturday Night Live but that is taking itself completely “seriously.” I think the manufacturers know that they could have just released a square cube with a strap on it and called it Seatbelt Relief, and that the Tiddy Bear was clearly a better strategy. It’s a brilliant strategy, in fact, because in an attention economy, it’s something that will get people talking and in the meantime, they’ll sell a few since it solves an albeit trivial need. It’s still a little frustrating (to me anyway) that we’re still a culture not above manufacturing products that have two and three year lifespans as products and decades long lifespans as garbage, but whatever; I still think we’ll get there. Asking for a totally sustainable product lifecycle for the Tiddy Bear just sounds silly, doesn’t it?

But one thing that bothers me about this mass spamming kind of thing is that I’ve in the past made an effort to mention my blog on another blog and included the URL in the hopes it would get some traffic. I suppose trackbacks are largely the same thing. And I guess I’m not sure if I feel like I would delete comments that were commercial in intent. If I had, for instance, just completed an entry about personal finances and Citibank wanted to jump in and explain how their services could help and provide links, I don’t think I would mind. The obvious objection is “they should pay for that privilege.” But let me be clear, I’m not talking about a generic comment posted on numerous blogs. What I mean, is that if someone at Citibank took the time to make their comment directly related to my entry, I would likely leave it.

It makes me wonder if their isn’t a viable advertising business in sending people around commenting on blogs on behalf of businesses — a less massive and more personalized version of AdWords.