Doug Poretz

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  • Wall Street Truthiness Watch: CNBC Edition
    Interesting observation, but as someone who spends their life in the communications indystry: this is nothing new. In fact, whereas mainstream media "journalists"... denigrate bloggers for not checking facts, for not abiding to high journlistic standards, etc. etc. and bloggers would be well-advised to emulate the high standards of the mainstream media. But you know who has been emulating whom? You just picked one example by someone who is usually a fine reporter. But what you saw wasn't "journalism" -- it was "blogism." My vote for biggest blogger of the year: Keith Olbermann -- it doesn't matter whether you tune to a URL or a cable or over-the-air channel; it doesn't matter whether you pay for the content or get it for free -- none of that differentiates journalists from bloggers. It's a matter of whether you speak for yourself or speak for a totally objective pursuit of accuracy where the first person is never ever used (at least that was told when I was a reporter 40 years or so ago).
    Dec 24 16:50 pm |Rating: 0 0 |Link to Comment |View article
  • The Housing Blame Game, Redux
    Fascinating article, and comments by Prudentinvestor and Lok Sang Ho. However, I think this discussion misses another major point: in addition to the financial instruments and policies that certainly exerted major influence on the housing bubble, they existed within the context of a cultural phenomenon.

    From 1986-1990, I was VP at NVR, working closely with co-founder and then Chairman/CEO Dwight Schar -- a brilliant businessperson who also happens to be a very close friend of George W. Bush, and for years one of the major fund raisers for the Republican party. In addition to working with him, I attended and made the company presentations to financial analysts (at the time NVR was the nation's largest homebuilder), so I got to see all the other builders make their presentations over a period of a boom and into the real estate crash of the early 1990s. It occured to me then that there was a fundamental change happening:

    The fundamental rule of real estate had always been: location location location. In the mid-80s, that rule changed (at least for a while) to: product producty product. Location wasn't irrelevant, but take a look at the advertising and marketing of the new home builders. They stressed bigness, open space, tubs so big that the water got cold by the time the tub was filled, extensive upgrades, customizing etc. At the same time, the market began to be segmented so that there was no longer just a "move-up" market but there was a "first time move-up," a "second move-up," and then the McMansion market. Product became king. So what if the house was located in the far suburbs requiring an awful commute? Look what you could live in once you got home!

    Whereas the real estate crash of the early and mid-1990s did pop that bubble, the culture that gave rise to that boom only went to sleep -- it was resurrected with incredible vigor in the late 90s and into the first few years of the 00's. The marketing that was use to turn-on the market could not have succeeded unless the market itself was susceptible to that pitch. And that is my point: the market itself (our culture) also must assume a major burden. The house became the most important evidence of wealth and evidence of wealth became a priority to Americans -- even if you didn't actually have wealth, you could still look like you had it. Remember the TV commercial that showed the guy with all the props of wealth who admitted that he was "in debt up to my eyeballs"? Yes. The appearance of wealth not only became more important than actual wealth, it became so important that debt would be assumed that actually undermined the reality of wealth for the sake of giving the appearance of wealth.

    That, I believe, was a cultural phenomenon. Certainly it was helped by financial instruments and government policies. However, it was fueled by the culture and priorities that dominated our society and nation at the time. To take that out of the equation would be a major mistake because if we do not sensitive to it, we will not observe the changes in culture that will arise as fundamental values are reshifted to work in the current economic and political environment. And I think those cultural changes will exert at least as much influence as any new mortgage instruments that may be appear on the scene.
    Dec 23 10:53 am |Rating: +1 0 |Link to Comment |View article
  • Pragmatic Media Predictions for 2009
    I agree with much of your predictions. Here are two more:

    -- There will be at least one failure among the several multinational communications conglomerates built through earn-out acquisitions of ad agencies, pr firms, interactive and other related niche firms

    -- Whereas there will be a collapse in the amount of consumer-oriented "buy this" messengers hitting the American citizen, there will be a very noticeable increase in the amount of politically-driven messages due to the mission critical need special interest groups (corporations, associations, community groups, etc.) will have to defend the status quo that benefits them from being changed and to promulgate new proposals that could aid them. The increase in "supporterism&quo... will be attributable to the ability of President Obama to sell his agenda to the American public for enactment by a majority Democrat Hill. This will gradually lead to a shift in cultural values in the nation.
    Dec 22 21:43 pm |Rating: 0 0 |Link to Comment |View article
  • The Antidote to Economic Malaise: A Culture of Collective Mindfulness
    I agree with the need for a culture change -- in fact, I believe we are beginning the process of a culture change, whether we like it or not. But I believe the "culture of collective mindfulness" is more like a tactic than an overall strategy. I think cultures are likely to change largely as a result of an evolutionary action rather than an attempt to put fingers in the dike when the flood of revolutionary forces is already upon us.

    I'd like to make two general points.

    1. Try thinking of the economic situation not as an economic situation that stands by itself as if it was some sort of cyclical event that we'll work through, but as a subsegment of a more significant situation. See it in the context of a cultural event. Certainly there are cyclical factors at work, but i believe the depth and breadth of this situation goes far beyond simple cyclical economic factors. At the same time we have major economic turmoil, we also are going through the transition from a manufacturing to a knowledge economy (which, on its own merits, will give rise to new business models) ... we are now living in a truly global economy (also requiring new models) ... we are seeing major political/demographic changes, including the eroision of the quality of life for the middle class ... there is incredible volatility as to both the availability and the price of essential commodities (food and fuel) ... and we have a population that has been swamped with "buy this" messages on a very forceful and constant basis since the post WW II expansion, which over the years has transformed "The American Dream" (which is really a World Dream) FROM one based on ideological beliefs and high standards for individual responsibility and opportunism TO one based on buy more, buy newer, buy bigger, buy more expensive, buy on credit what you cannot afford. That isn't just an economic situation. And thus, it won't be changed simply by economic changes -- expect to see some major cultural shifts. I think it is too early to predict those shifts, but it isn't too early to become concerned -- because these shifts are going to occur in a world where individuals can communicate (and coalesce into communities) online 24/7/365, unrestrained by time, geography and (moften) language. How would the French Revolution be conducted in the age of the Internet? You might want to start considering that question, and see if you find some answers emerging in 2009.

    2. New Models -- I have some experience here because i have co-founded and helped build a communications firm (as in PR/advertising/interac... al) that has a radical new model, starting with the way we bill: we do not keep time sheets and we do not bill by the hour -- that is a basic difference that sets us apart (our growth and margins also sets us apart). Anyhow, I've written at my blog on the specific issues of extablishing a new model (tinyurl.com/8dvk8g). The suggestion that you should have a mistake-focused culture when dealing with a new model isn't "advice" -- it is an a priori truth. That is because new models have new mistakes. And unlike old mistakes that have become recognizable and defineable over the years, along with the remedy that more or less works, NEW mistakes are not recognizeable and there vare no precedents for what works as solutions. You only see them after they have bit you. That's when you say: "what happened?" Then, it isn't simply an issue of identifying it as a mistake, but you have to define it accurately (and that usually doesn't happen on Try One), and after you define it, you have to develop a remedy (and that usually doesn't happen on Try One either). So, the cutlure of "collective mindfulness" is a great phrase and a very difficult and time-consuming reality, often setting off (by necessity) a whole bunch of new mistakes in its wake. Another thing I have learned is that as you encounter new mistakes, you have to develop new solutions consistent with the core fundamentals of the new model (that is, you cannot use old remedies for an old model to solve new problems in a new model) -- as you do that, your new solutions make your enterprise more and more unique -- so you are going to run into even more mistakes that you won't know are mistakes (again) until AFTER they have hit you. This gives rise to a cultural phenomenon that isn't very nice -- you are correct in that you have to have a culture where everyone looks for mistakes, and that can be a good thing, but it also means that people stay focused on "what's wrong" and that becomes a problem if at the same time you fail to revel in your model, despite everything that is (and will be) wrong about it.

    I applaud the effort to point the finger of blame at something bigger than "lax regulation" or "greed of Wall Street," etc. -- It is much bigger yet. It is, in my opinion, cultural -- but still, much bigger than a culture that lacks collective mindfulness. I think this is going to be a much bigger "correction" (or whatever it is called) than anyone currently envisions. And that concerns me. I think, all too soon, if I am correct, that phenomenon will concern us all.
    Dec 22 10:14 am |Rating: 0 0 |Link to Comment |View article
  • The Madoff Magnum Opus
    In a related vein, see Leonard Downie's piece in today's Washington Post -- tinyurl.com/7qpnon (hope I made that link easy, if not it's at washingtonpost.com -- outlook section). He is raising some really intriguing ideas about the state of the news business today in the context of addressing whether Watergate could be uncovered today. I think he is much more complimentary in general about the effectiveness of a new type of blog journalism than you would think someone so associated with traditional media would be. But he suggests the process will be vastly different. I think he makes some important points.
    Dec 21 14:36 pm |Rating: 0 0 |Link to Comment |View article
  • America's Economic Collapse: How Bad Will it Get?
    Great article -- but it makes me even more concerned that we are going through more than just a global economic situation but a global cultural shift. If thinking about where the economy is going is scary, try thinking about a world where people can coalesce into new communities online, pulled together for various motivations to promote or seek various special interests, unrestrained by time or geography -- doing it at a time of economic turmoil in a global economy, where vital commodities (e.g., fuel and food) are extremely volatile in terms of cost and availability, and where old models are coming apart. I think we have to start focusing on the bigger issue of culture as a whole.
    Dec 18 08:34 am |Rating: +2 0 |Link to Comment |View article
  • Madoff Breach of Trust: Essence of U.S. Economy Was Violated
    I have been convinced (see my blog, linked above) that the economic situation is not the real problem, but a symptom (dramatic and with dramatic consequence) of an even bigger problem that is cultural in nature. Since the postwar expansion, our society has become a society of consumers, who have been innundated their entire lives with "buy this" messages. In the process, "The American Dream" has been shifted from one based on certain ethical and ideological standards as well as personal opportunities and freedoms to one based on buy more, buy bigger, buy on credit, buy what you can't afford, buy buy buy. Yes, there has been a breach of trust -- but there has been more, including a tectonic shift in the cultural evolution of the nation and, by extension, much of the world.
    Dec 18 08:22 am |Rating: +1 0 |Link to Comment |View article
  • The Death of Profitable Journalism
    The business of newspapers has not been the business of selling journalism. The business of newspapers has been to sell portions of its distribution channel (newsprint) to those who want to use that channel to get their message to an audience. Journalism has been the hook to get the eyeballs of the audience; but the business has been the sale of the distribution channel.

    The fundamental change that is occuring is that the distribution channel is no longer always owned. It is for the taking. Pay a few bucks for a URL and you've got a distribution channel. Journalists no longer have to be employed by a distribution channel-owner. And advertisers can be much more efficient in targeting their audience and delivering powerful messages packaged to resonate on very individual levels.

    I have 40 years in the communications industry from the perspective of PR, advertising, interactive, etc. I have been amazed that although the technological innovations of the past few decades have had their greatest impact on the way people communicate -- a true revolution -- the communications industry has continued to operate with outdated models. At best, they have tried to bandaid the existing models when what they should do is blow them up and start from scratch with new realities.

    For anyone interested, I have written on this sort of subject at my blog, which is linked above.
    Dec 16 10:23 am |Rating: 0 0 |Link to Comment |View article
  • What If the Great Depression Analogy Is Wrong?
    I have been arguing that we should call the current economic situation neither a "recession" nor a "depression" but, for lack of any better descriptor, "The XYZ Event." I believe we are going through something very different than just an economic situation, albeit I do not deny that a recession or depression may be part of it. But only a part.

    I believe we are experiencing the consequences of a certain culture of hyper-consumerism, which is playing itself out, at the same time that we are making very significant moves from the manufacturing to the knowledge economy, experiencing incredible volatility with the world's most vital commodities including food and fuel, living in a truly global economy, and doing it all in a world where communications (and the creation of new structures of "communities"... is full time and real time and spans geography, time and language and the media is no longer owned.

    If my premise is correct, the changes that we are about to see will be cultural and political in nature as well as economic. I have been writing about this from my perspective with about 40 years of experience in the communications business at deathoftime.com.

    I believe we can see an important initial sign: the bifurcation of the communications industry. Messages that say "buy this" have dominated the American consciousness since the post WW II expansion. We are beginning to see the greater emergence of messages that say "support this." The hyper-consumer society is about to be moderated by a surge in "supporterism.&qu... Watch your TVs and all other messages that are getting to you. You can see this trend for yourself. This is an important cultural sign.

    Politically, we are also seeing other major changes, including the phenomenon of capitalists throughout the world applauding -- urging-on -- more involvement by the state. The process of Hegelian shifts is not confined between a Tuesday and a Thursday, but takes generations. Moves are usually subtle. But I think we have just seen a pretty big benchmark in the process.
    Dec 16 09:20 am |Rating: +1 0 |Link to Comment |View article
  • December Consumer Confidence Approaches Six-Year Low
    It is interesting to note that while Americans-as-consumers are reflecting a decline in confidence, Americans are dramatically optimistic in political terms. The latest polls that I see show that about two-thirds of this nation express confidence in President-elect Obama. A couple of weeks ago, I gave a speech (qorvis.com/blog/index..../) at The National Press Club conference on "The New Washington" in which I suggested that the communications industry is in the early stages of being bifurcated between consumer-driven messages (those that urge "buy this") and supporter-driven messages (those that say "support this"). Layoffs in the New York advertising community, the center of gravity of consumerism, are hitting massive numbers; in the meantime, Washington, DC, center of gravity of "supporterism&quo... is holding its own, and evidencing early signs of growth. Look at the advertising that is hitting you: you'll see more and more messages about energy reform and healthcare and union voting and tax policy. Neither President-elect Obama nor the new Congress have been inaugurated yet ... political ideas have not yet been translated into specific proposals and the clash between those proposals and honest ideological differences as well as good old partisanship has not yet occurred. Just wait, the American citizen, hit with "buy this" messages since the Post WW II Expansion is about to be innundated with "support this" messages. This will not only have an impact on the communications and media industries, but will eventually lead to a change in the nation's culure (see my most recent post about Steve Pearlstein's blog on Leadership at deathoftime.com).
    Dec 14 13:34 pm |Rating: 0 0 |Link to Comment |View article
  • Global Ad Spending Expected to Drop in 2009
    These estimates are over-blown. The hit to advertising agencies will be much more dramatic. If WPP is actually basing their budgets and plans on these projections, go short -- they are in denial big time.
    Dec 10 10:09 am |Rating: 0 0 |Link to Comment |View article
  • The Real Problem? People Are Scared to Spend
    Very intriguing but I have the following other observations:

    1. Officially we are not even in a "Recession" yet -- we have not yet had two sequential quarters of negative growth, which is the defintion of a Recession, as you know. But if we aren't in a Recession, or a Depression, we are in a Something. I think that "Something" is new and should have a new name. For now, I call it "The XYZ Event." I think what we call this economic period is important -- if we use old terms to define and diagnose the event, we will use old remedies. I think this is different from either a "Recession" of the past or the Depression of the 1930s due to some vastly different fundamentals, among them a shft from a manufacturing to a knowledge economy, the emergence of a truly global and interlocked economy, and a radically different communications infrastructure.

    2. I think there is a major consequence that you do not account for by virtue of the speed of information now as compared to the Depression and even previous Recessions -- we get information and put it to use much quicker, by an order of magnitude. We know much key fundamental economic data on a real-time basis, and that data we do not know as it happens, we do know very quickly, especially as compared to the 1930s. Improved IT networks and reporting systems allow manufacturers to control inventory much better, allow corporations to adapt budgets quicker, etc. This allows the rapid and almost total "shut down" of spending by both businesses and consumers, as we currently see, but that, in turn, should mitigate the ultimate damage.

    3. Most significantly in my opinion, the current economic situation is not attributable to a single event or institution or enforcement or non-enforcement of any regulation, albeit all those contributed to what's happening. I think the innundation of "buy this" messages that have surrounded the American public since the post WW II boom, has led to a culture where "the American dream" is a consumer's dream: buy more, buy bigger, buy more expensive. All aspects of our society became ensnared in that culture -- those who created new debt instruments, those who encouraged their customers to stretch a little more for a bigger and more expensive house, and those who decided to buy a new flat screen TV even though they couldn't afford it because they didn't have to make any payments "until next year." Until we come to grips -- get out of denial -- about the cutlure that gave rise to this economic mess, we won't define the situation correctly -- and we won't be able to remedy the situation until it is correctly defined.

    Despite my opinions, I am not optimistic about the economy for the near-term at least. I am, however, certain that the creative component of this destructive period will be very robust and ultimately the world will be better for it. For anyone interested, I express this type of thought and related issues about communicating messages at my blog, which is linked above.
    Dec 01 09:01 am |Rating: +4 0 |Link to Comment |View article
  • The Current Economic Crisis: Hell, Meet Handbasket
    I agree with much of this article ... except I would urge the importance of thinking to "the next step." I believe that whereas we can point to a number of specific "triggers" for the economic situation, ultimately the situation is attributable to a cultural issue.

    Since World War II, people have been innundated with "buy this" messages. The benefits for increasing the efficiency and effectiveness of such messages were obvious, and so more effective communications tools and techniques were developed. I was struck recently by the news over a survey that showed that teenagers who are exposed to more sex on TV are more likely to have sex. That's shocking? Consider what hour after hour, day after day, decade after decade of "buy this" messages have had on our culture as a whole. Over the years, the impact of these messages translated into the culture that led to people over-stretching for their homes, realtors more than happy to craft that deal, mortgage companies willing to finance it, and a retailer out there willing to sell the new furniture on some really great terms ... Hey, let's get a new car for the new garage and go out for a great dinner, we'll put it on the credit card. Etc.

    The death of the consumer economy that is upon us will drive many of those who push the "buy this" messages to cut their budgets and find more efficient distribution channels. This will accelerate the trend to rely more heavily on interactive and digital communications (or "new media"). At the same time, with a new political environment in Washington and a new White House promising to "hit the ground running" plus an energized and supportive electorate focused on "change" and a one-party Congress for all practical purposes, there is going to be a surge in "support this" messages from special interest groups of all ilks, sizes, persuasions and motivations. The proposed changes will be way too significant and fundamental for the special interest groups to sit on their hands.

    If you look closely you can already see it happening: have you noticed the new TV campaigns for the AMA and for the chemistry industry, for example? When is the last time you saw them advertising? It's the tip of the iceberg.

    As this happens -- that is, as the consumer becomes "the supporter," we should expect a major cultural change. If anyone is interested, I write about that sort of thing (from the perspective of a 4-decades long career in communications) at my blog, which is linked above.
    Nov 10 09:26 am |Rating: 0 0 |Link to Comment |View article
  • Big Media: Future Growth Depends on Serious Change
    There will be a concurrent meltdown with the large ad/PR/etc agencies. Just wait. There will be "Lehmans" in the communications business.
    Nov 09 20:17 pm |Rating: 0 -1 |Link to Comment |View article
  • The Economy's Worst Is Still Ahead of Us
    I agree with all the above, but will take it a step further. Since Post World War II, this nation has been innundated with "buy this" messages, and, as a result, adopted a materialistic culture. It was that culture that gave rise to the economic situation described in your comments. But it gave rise to other things as well: our politics, our entertainment, our life styles. The consumer, for all practical purposes, is dead for a while (OK: comatose). The traditional advertisers will seek greater effeciency for their dollars, and they will take their messages to those distribution channels that go straight to their targets. At the same time, the political change that is about to occur in the US (and the world), is going to cause the emergence of a massive amount of "support this" messages -- brought to you by the special interest groups of all ilks, sizes, persuasions and motivations that will need to defend against changes that could change the rules of their game (as well as promote some changes that can make their game better). Ultimately, there will be a cultural change. I think it is way too early to predict what that culture will look like. But I do not think it is too early to predict that some old business models are going to fail -- for example, in my business, the communications business. If interested, I write about that at my blog, which is linked above.
    Nov 04 08:57 am |Rating: 0 0 |Link to Comment |View article

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