“Startups are changing the economy”

An exclusive interview with David Meerman Scott, leading expert in digital marketing in the United States. Twenty answers with his advices to startup and his vision of marketing, communication and publishing

David Scott Meerman 600x400 per il 10

David Meerman Scott is an american online marketing strategist. He is author of several books on marketing, most notably is the bestseller The New Rules of Marketing and PR with over 300,000 copies in more than 26 languages.

Recently you wrote about three major periods in human communications: Could you explain us this classification?

So, I am thinking about a big picture of humanity. And it is really interesting for me, in the picture of humanity, because before the printing press, so before 1400s, humans had to either memorize something or write it down by hand. And what that meant is things weren’t written down and people who had access to written materials tend it to be the religious people, and so at that time humanity was poor and we were living in, that was in the medieval times. When the printing process was invented, about 550 years ago – roughly – all of a sudden these thoughts could be printed and anybody who could learn how to read can had access to information and that access to information completed two really important things: one, it freed us from having to memorize things because we could write it down; and, the second thing related, it meant that people could create information because it became much easier and that brought humanity out of the medieval times and brought up the renaissance and created art and made it possible for us, to all humans, to become more wealthy and so on, so the very interesting development and then for five hundred years we had that, but always it was still one way communication: it was the government communicating, companies communicating, education by universities communicating and recently in the last ten-fifteen years all of a sudden was the Web and two-way communications.

What is changing?

I think we are in the most important revolution in human communications ever because now anybody can communicate with anybody else in the planet and it can be two way and I think it is changing everything. It is changing the way we market our companies. You just look here: there’s seven billion people in the world, and six billion of them have a mobile phone.

So, I think that we are still, as humans, we are still thinking what that means for us. But I think that if we look back a hundred years from now to this period, we will look at it the same way we now look at when the printing press came. That is very, very important.

And not that many companies, and not that many people, and not that many governments really understand what that means. And so what it means for Italy, for example, there should be Internet connectivity everywhere for everybody because that makes it easier to connect, to communicate, to build companies that can become part of the global market. So recently I have been doing a lot more thinking about a great picture and it is just very interesting to me, what that means. My philosophy right now. That is the only time that I allow myself to be a philosopher.

How the digital revolution has changed the rules of marketing?

Before the digital revolution if a company wanted to get noticed, they had a few options: they could advertise in magazines, newspapers, television but it was expensive. The other thing they could do is work with the media, to get the media to write about them, to get noticed, to get attention. The third way is they could have sales people: who could try to get the attention at one at a time, you know, the client on the phone or whatever it might be. But now we have a fourth option, which is a great option which is to create information on the web, whether that is texting, informational blogs, video, photographs, images and all of that becomes marketing because of two things: number one people are searching for information. If I have to take a car, I want a rent a car, I do a search maybe I’ll find Uber and I have done this before, I will say to my friends on twitter or facebook: “I love Uber”, it is great and I did blog post about Uber and I said to my friends this is a great service, you should get Uber and that did not cost Uber anything it was free for them because I am writing about it.

Are we evolving from a mass media society to a personal media society?

That is part of it, but also a corporate media society. Because I believe that every company should think of themselves as not only the product they create, but also as a publishing company. So every company who is in this room at Talent Garden, every company whose logos are on the board outside, they are all publishing companies. They should be publishing content, they should be publishing blogs, they should be publishing videos, they should be publishing in tweeter feeds; because that publishing turns every company and every person into a creator of content that people can follow. And it is such a better way to reach people for many businesses than the traditional ways of paying for advertising.

Now buyers are finding answers to their problems online. Do you think that this is one of the reasons of the adv’s crisis of the mainstream media?

I think, that there is a lot of interrelated things. One of them is that with information everywhere available on the web, for free, people don’t necessarily pay for media anymore. And so that is one thing: why should I pay for the newspaper when I can go to Google and get that content anyway? And the other thing that is happening is advertisers realized there are others ways to reach more potential customers than spending money on advertisers. There’s lot of different ways, so that I don’t have to spend all the money I have on an advertiser.

So I think those are the two things that are happening with the media and one thing that a lot of people talk about is, well, if media is declining, the number of reporters in newspapers, the reporters in television are declining, they said that is a bad thing for the journalists but I say no, it is actually a good thing because all of those journalists now have potential to work at any kind of company.

Do you believe in brand journalism?

I totally believe in brand journalism.

Is it popular in the USA?

I think it is becoming a bigger phenomena. When I first started to talk about brand journalism, in 2004, everybody thought I was crazy. Who was this???

It seemed not good put together words like brand and journalism…

And people would think that is crazy and the journalists would say there is no way I work for a company. But now they want to, many of them want to work for companies. And an example is Raytheon two weeks ago I visited a great plant. A big American defense contractor they build missiles, equipment for boats and so on. They have a corporate marketing department that has six people. The head of that department used to be a television producer in Canada. And the head content creator worked with the Associated Press (AP) and he was the corporate reporter. And another person who does their social media, used to do the social media for NASA. And so this kind of brand journalism at a company like Raytheon and who would have thought that a company, whose biggest customer is the American Military, would actually have an AP reporter doing their marketing. I mean, most people would think that is crazy, but no, it is great. And so I think that there is a huge opportunity for journalists, because there are so many companies that can use their help, and I think that is a really, really great opportunity for companies because that’s the best person that they can find to help them. But most companies when they want to do marketing, they hire advertiser or people who are skilled in product advertising, check all the people there have when they could be journalist. I am little bit arrogated about it, but that is how it seems to work.

How the social media have changed the society and politics?

I think that it already is, I mean look at Egypt, I was in Tahrir Square in January, I met with some other people who are part of the Egyptian revolution, I could have a master class in Cairo, and social media help to put down the government and Egypt, what is happening is that now everybody has a voice, not just the government. Everybody has a voice and that voice has potential to change, it has the potential to change the way the things are done, it has a potential to change the way businesses operate, it has potential even to change the government.

So, it gives people a lot of power, and it could be abused, for example with reviews, like Yelp or other type of restaurant’s reviews, or I can review the black car driver on Uber, and now I have power. It used to be that if I went to a taxi I had no power, ever. You know I was at the mercy of the taxi driver, but as soon as was given the opportunity to make a rating, all of a sudden I am incredibly powerful because if I give a driver a one star rating, that could be a bad thing but if I give a five star rating, that could be a good thing. With my book, people can review it on Amazon and all of a sudden they have power, they can give me five stars or four, so I think it is very liberating for society, but also it comes with responsibility.

How generate attention in a communication world?

I think, well, with a lot of companies that does not work well, they only talk about their products and services when they create content, when they try to generate content. They say: “here is what we do”, we make tables and it is a great table and it works and it is very light, if you don’t like you can burn it to warm you up. What works to generate attention is to understand the problems that people face and how your product can fix the problems. This is a kind of environment that is constantly changing, so this kind of furniture is constantly changing, move the shift, make it different. So when you think about it from a perspective of rather than what we do, but what are the problems that we solve, that can be one way to generate attention. The other way is to realize that every market is a niche market, if you think that every market is a niche market, then you realize the competition is not with everybody: the newspaper is not my competition, the magazine is not my competition, amazon.com is not my competition, my competition is really people’s attention.

Less is more?

If I make myself the world’s expert on a small subject, I can generate points of attention but if I start to be bigger, is nothing work. If I only want to generate attention to my only customer, to spend time on my customers then I can be number one, then maybe I can go into Switzerland, and then I be number one of the star of the world, but if I try to be number one for the entire universe that is going to be difficult or if I tried to be number one for all the Italian companies in information that is difficult. Number one for Italian startups information, like StartupItalia!, maybe I can do that.

We hope it.

I think so.

Do you think that mobile phone could have an important influence in the world’s economy?

I do, because I think mobile phones especially in developing countries are the only form of communication they really have. This is expensive. And why your internet connection don’t reach all the part of the world but Six billions out of seven billion people have a mobile phone, may be only voice, but they have a connection, they have a communication, eventually it will be a smartphone. I wrote about this on my blog, where I talked about the big picture of the first question you asked, I spent time last year in Panama and I went to this village called “Cangandi”. They moved their village one kilometer from the side of the river to the top of hill, the entire village of three hundred people, because on the top of the village they had cell phone connection. They didn’t have that in the river. It took one month to move the whole village. So now they have the village at the top of the hill, they have no running water and they have no electricity but they have mobile phone connection. The way the charge their phones is with solar panels, solar power panels that connects to a power source to connect to their phones, and it transformed their economy. They are farmers, they farm in particular cassava roots and they take these cassava roots down the river to the Pacific Ocean and to other islands in the Pacific Ocean where they can sell cassava roots. But for hundreds and hundreds of years, they used to fill their canoes with cassava roots. To paddle down the river takes a full day and to go from island to island it takes a few more days and they would stop at each island to sell the cassava roots and people there would say: “no, I just bought cassava roots from the other guy, I do not need yours” or they would say: “sure, we need some right now, please” or “we are not interested right now”. Sometimes they would sell cassava roots and sometimes they wouldn’t but now they use their phones. Now it happens that the villagers would call the islands saying “we have a new load of cassava roots, do you need them?” the other thing is the islands will call them: “we need some, could you bring them up?” So now they know exactly where they are going to go. And the other thing is that they sometimes go to Panama City, it is a one week journey for them. They have to walk and they have to take a bus, it is a very long journey, so they used to be away for more than three or four weeks, and people in the village they didn’t know about them: “are they sick in the hospital?”, “what happened to them?”. But now they can just call them. That is just an example, but if you think about transforming the world, the poor part of the world, the very poor parts of the world, and actually growing their economies, then you need mobile phone technology.

Is connection more important than running water?

So for this village it was more important to have a connection than having running water. They used to have water, they used to be on the river. Having connection was more important than being next to the water.

So now all the village goes to the river to look for water.

And it is all because of the mobile phone, and it was interesting that they get a connection, it is a subsistence village in the middle of nowhere in Panama, and because they are 45 miles away before reaching the Capital.

Devices such as drones and Google glass could be important tools for journalism and personal communication?

Ah, Google glass. I don’t know yet. Have you tried them yet?

No, I just read something about that. Maybe we are going toward a real time society…

What is interesting to me is… every time I hear about a new social network, I usually think to myself that sounds: “I don’t know how if I can use that”, “I am not sure that is interesting”. I remember when I first heard about Twitter and people told me about 140 characters, people can tweet but I didn’t know how to use that, this is related to 2008.

And then when I started to use it, I was like I am not really sure, but then I figured it out how to use it. You know I could tweet when I was at another country, I can tell people what I am doing, I can tweet before an event to inform people about it. The same thing happened to me with Instagram, sharing photos: “I am not sure”. And Foursquare, another social network I used now, I thought “wait a minute, I check in when I go somewhere else?” and “how I can use that?”… So the Google glass and drones I think I can use it myself, I am not sure what I can do, I have to experience. Thinking with the village, until I saw that village in Panama and then it finally got it. I understand it now. It is so important. I don’t know about Google glass, I need to try them.

Do you think that newspaper will survive in a real-time society?

I do, I think for a couple of things. Most bloggers and most journalist don’t write longform investigator content… it is not something they spend time on. So I think there is only going to be room for who can spend a week or a month to work on a story, there always going to be time for people to dig in stories that are maybe uncomfortable. I saw that a lot that, these past three weeks in Boston, and there was the bombing during the Boston Marathon. And the Boston Globe has done a terrific job with their journalists, I think for sure they are going to win a Pulitzer prize for what they are doing: the level of their recording and the quality of what they were able to show off, we had a special section every day for about two weeks 10-20 pages, all about the details about the bombings, they had 15-20 reporters all working on the bombings, who can else can do that? I suppose to subscribe the newspaper, US$ 500 dollars per year and there is always going to be people who want to have that. I think it is important for society, but there are still people who like it to read. Another interesting things is that when I a new communication technology comes along, almost never replaced another technology, because we had radio and when television came, radio didn’t go away. So, I think newspaper will be still around.

The digital revolution never stop. Are we sentenced to a constant learning?

I think so, I think that all of us are constantly trying to figure out how these tools work and what they mean. I think of Google Glass as a great example because I want to try them and to figure out how can they help me and until I do… Once I do I will realize I am gonna have to learn, where do I look to see how things works. So, I think as companies, as governments and as people, we need to constantly figure out how these tools can help us.

The 3D prints will be the door to the post-industrial economy?

It is an interesting technology. You know, you think about how do you make a product, how you make these devices, it used to be that somebody in a company would make this on a CAD software working for the company and then they will send that design to China and then that design could get made and then they would ship the product back to Italy, and then the company would sell them to the retailers. Something like this, anybody can design it, so that the company that, Samsung, it says… put this design out to crowdsourcing and say “we need a new adaptor”, and then somebody in a crowd could create it and the CAD program they could send to Samsung that looks interesting, will pay it 2000$ and the consumers could print it back at home. I think that it is another great example of we don’t know yet what that means, it is too difficult to figure out what that technology means. You know, I think everyone will have a 3D printer at home, just like today everyone has a computer at home. But if we had asked, if we had said 20 years ago, imagine 20 years ahead like imagine today, everybody is going to have a computer at home, what do you think they are going to use it for? I think it is very hard to imagine 20 years ago. I think it is a really amazing technology, but what we are going to use it for?

Do you think that startups could be a possible answer to the global market crisis?

Yes, I do. Absolutely I do, I actually already see it. Because Startup by definition get the mission to understand the market or new opportunities. In my country, for a long time people didn’t want to work for a startup, because they didn’t think it was safe to work for a large company like IBM. People wouldn’t want to work for a very small unpleasant company. But now there is all bunch of people who want to work for startups because see where the future is. I mention this company where I am on the boarding of advisor, called HubSpot, seven years ago they were nothing, now they have 600 people in Massachusetts that work for them, and so that has huge potential to help countries like Italy or like mine, absolutely, big time. I think more and more the nature of the work is changing, work in my father’s generation, work meant you get in your car, you drive for ten miles, at nine o’clock in the morning you go to your office and you do your work and at five o’clock you get back to your car to drive back, and now workers it can be anywhere, you can work from a place like this, with other entrepreneurs, you can work at home. I think it started to be critically important and I think that many governments don’t quite understand that, government should be all over, government should start providing something.

Here a video at the Masterclass in Milan. Luigi Centenaro speaks with Davide Meerman Scoot about personal branding