Marketing BS with Edward Nevraumont

I realize there has not been an essay or a briefing in a while. I am trying hard not to let this newsletter distract me from writing comedy. It’s coming along nicely, but at some point I will pivot back to writing more here. In the meantime, I hope you continue to enjoy these short conversations I am having with Peter and we are hitting the more interesting marketing news in any given week or two. In other news, my 1960s comic book podcast is re-branding. “Super Serious 616” is becoming “WHAT IF… MARVEL was real?”. I wrote a little about why we are making the change here. The big impedes was a big advertising push we are doing later this week that should (if all goes well) blast us to the top of the Apple Podcast charts. The hope is that after an artificial boost or two to the top of the charts, we can use the momentum to maintain that position naturally. It will be an interesting experiment. In the meantime I think the quality of those podcasts have gotten better and better. If you are at all interested, now may be a good time to jump onboard. In the latest episode we discuss just how fast Thor would have to fly in order to cross the Atlantic Ocean in three minutes, and what that means for situations like saving someone from a speeding truck. Now onto this newsletter’s podcast: Full Transcript Edward: Peter, when was the last time you saw a movie in the theater? Peter: Oh, we go every couple of weeks. Every now and again, it's a very different experience now with, the big crazy seats and having to pick your seats in advance. And it's just, it's not like it used to be, but still it's a nice getaway. Edward: Nice. So you paused during covid, but then you're back at it the same frequency there before. Peter: Actually, even during Covid we'd go a couple of times. There was one time we went to tenant. Only people in the theater . Edward: My crazy tenant story is, for a buddy of mine's birthday, I rented the entire theater so the two of us could go see it. Peter: There you go. Well, we didn't have to rent the theater, we just bought regular tickets and you still got it. Don't think or so, but during Covid when no one was going to theaters, it was like the safest place you could be cuz no one else was there. So fair it out. So we'll still do it, every now and again. But it is funny how the industry has changed and maybe not funny, maybe sad how it's changed so much. Edward: Yeah, I think it's interesting how little theaters have changed over the years, and it feels like they're changing quite a bit now. As you said they've made changes in terms of the seats are fancier and more comfortable and they're serving better food and so on. But in terms of like things like pricing, pricing has been, Hey, pay one price. Everyone pays the price to walk in and sees the theater. When you're dealing with a product that has an expiration date, like after 8:00 PM on Thursday, anyone who's not bought the ticket, those empty seats in the theater are going unsold. It's very much like an airplane, but theaters have never been priced like an airplane. Peter: I have never understood that. Yeah, they should definitely be using different kinds of dynamic pricing. And of course it's not just them. It's gonna be the same thing with sports venues and concerts and yeah. It's funny in those domains, you keep hearing a lot about it. Sometimes controversial, but movie theaters seem to be just clinging to their kind of dinosaur ways. Although I guess just now starting to change. Edward: And then even things like. Not just dynamic pricing, but even pricing by title. If you go and buy books, books vary in price. Every book you buy, I don't know what the price of the book is gonna be until I look at the price on it. And they're all over the map. Whereas when you go to see a movie, whether you're gonna see a 500 million avatar sequel, or are you gonna go see a nice little small new indie. They're all the same price. Peter: That, and that's why it's so...

Some quick updates: * I have an essay in progress. Will hopefully get it to you in the next couple of weeks * Stand up comedy is coming along. My first “big show” is on Tuesday. If you are in Seattle feel free to stop by at Club Comedy. * If anyone is interested in learning how to edit these podcasts and is willing and able to do fast turn-arounds, just reply to the email and let me know. It’s not hard and it’s kind of fun with the software I am using, but it is something I am ready to get off my plate. Quick Take aways: * Here is the article we talk about in the podcast (free link): With New EVs Arriving, Brand Loyalty Goes Out the Window * Here is the book Peter mentions: How Brands Grow * Too long/didn’t listen: EVs have not changed the rules of loyalty Full Transcript Edward: Peter, now that electric vehicles are around brand loyalty doesn't matter anymore. It's all the Wild West. That's what the Wall Street Journal is selling. Peter: Oh man, I've heard this song before . It's the same old tuned men whether it was gonna be the internet, oh, that's gonna change everything. Or social media or covid. It's gonna totally upset the rules of loyalty. Yeah, those rules are pretty locked in and I'm willing to say same story here. Edward: So what are those rules of loyalty? What are the rules that the Wall Street Journals claiming are garbage now? Or are they just missing the entire. Peter: It all depends on how we define the rules. Where I'm coming from it coming forward it is from the top down. If we just look at actual behavior and just look at the choices that people make over time and how often they switch around and what they switch around from in two, there's some very regular patterns to that. And we could talk about it, but all if you go a level deeper and say, what are they thinking? How are they making these decisions? Sure. Maybe the psychology's a little bit different, but from a business standpoint, that's all cheap talk. All we really care about is what are people doing? And in that regard it's no different than people rolling a dye to say, which, which of these different items am we gonna buy? Edward: What they're, so let me quote from the actual article. It says that basically in the past, whenever someone bought a Ford vehicle, 58% of the time it was a Ford vehicle. Now, when they're buying the Ford Electric vehicle, 66% of the time, it's not a Ford vehicle. So there's significantly more people switching to Ford to buy the electric vehicle than we're switching to Ford to buy the non Ford vehicle. Peter: Yeah. First of all, we don't even know if it's significant or not, but second of all, it's cuz the set itself is changing. The number of electric vehicles out there is really different. It, no that's just nonsense. It's cherry picked, rubbish. Yeah. The way it's interesting that we talk about cars cuz the people who first set out these rules that I'm referring to and I know you know it well. There was a guy in London called Andrew Berg and his heir Byron Sharp at the University of South Australia. They basically say that it's you have your die. I have my die. And what drives our choices is, It's just as if random, and it's remarkable how well that story works. The do sleigh model as we call it. And there's no reason to believe it'll be any different here. Do you think So? Edward: You say it's random, but that's not entirely true. It's weighted random, right? Because if I have, if I bought, if my last car was like a Subaru Forester I think when I go buy to buy my next car, I'm more likely to buy a Subaru Forester than amped. Whatever the average of all the other market shares are. I assume Peter: you are so right about that. It's, yeah. It's not that we're all rolling a six-sided equally way to die. In fact, it's not like we're all rolling the same dye that, that there's gonna be this distribution of dice and even that is gonna be well described by again, a. Jewish lay distribution. Look that...

Happy new year! Expect fewer posts this year. I will keep going with this podcast, but I am shifting my time commitment to (1) get the book over the line. No more excuses; and (2) Work on developing “business comedy”. I will write more about #2 at some point, but for now enjoy the podcast, and be happy if you weren’t flying Southwest the last few weeks! Full Transcript Edward: Peter, how were the holidays? Peter: Wow. It seems like a million years ago, doesn't it? It's amazing. We had that kind of one day after New Year's adjusting and then boom. But it was great. I went down to Antarctica and it was amazing. Super fun, super interesting. What about yourself? Edward: We tortured ourselves by taking our four little children to Guatemala and Belize. Peter: Wow, that's bold. That's bold. Edward: But I think the nice thing is both of us missed the travel meltdown that happened. I think we both got out before everything started falling apart across America. Peter: It was amazing actually being down in Antarctica. where it's kind of warmer and more pleasant than it was in most parts of the us. What a mess that was Edward: Go to Antarctica for the heat . Peter: Well, it was summer and, I think unfortunately the repercussions of that are still rippling through and it's gonna be a while before that all settles down. Edward: It's interesting. We were flying on Alaska and there's now a direct flight between Seattle and Belize City. and there were three flights before ours, and they're a limited number of flights now that go back and forth. Like they're only every couple of days. And the three flights before ours were all canceled, so we're on the edge of our seats and whether we were gonna get back on time. Peter: And between all the cancellations that were happening earlier in the summer for different kinds of reasons, staffing, and now all of the kind of Southwest mess, which is more kind of operational issues, we have a very different feeling in the stomach when we pull up to the airport these days. Edward: One of the news this week, southwest Airlines had a big, big mess up where every, all the airlines kind of had trouble, but I think Southwest had the most at one point, I think they'd canceled half their flights. It was like a huge, huge, huge. Peter: Yeah. And I guess, if you read, some of the, articles and blogs about it, it seems like it was, it was inevitable, right? That they've been on a bit of a downward spiral in recent years and letting go of some of the operational aspects that would've never happened back in the old days. But, it's a shame it had to hit. Abruptly, and it's such an inconvenient time. Edward: Well, that's what's gonna happen, right? When you run really lean, if everything's going well, it's not a problem. It's when things start to go wrong, all of a sudden they can go really, really wrong because that's when things break. Peter: Exactly. And of course, the lessons to be learned are, How not to let them break, but also how to, how to recover from it. And I still think there's a lot of lingering questions about that. Edward: I think the Wall Street Journal was just publishing earlier this week about how Southwest is now saying, sorry. They're admitting their failures. They're offering, they said 25,000 frequent flyer points so that passengers hit by the travel meltdown. What do you think of that? Like, what is the value. The passengers who are getting that treatment to get them to come back? Or is it the signaling to non passengers that, Hey, we really. Peter: It's very interesting. My, initial reactions be really, really fun to, to talk through, was not a positive one. About that move. Couple of reasons. Number one, devalues the point. It's like, we're just gonna throw some stuff at you. You spent all this time trying to get people to value points and earn and get status and all the great things you can do. But just to use it as a way just throwing stuff at you, it kind of makes you wonder...

Essay and Briefing production has been low the last few weeks as I have been spending more time on building a GPT-3 powered comedy writing tool (and writing “business comedy” with the tool). If you have not checked out ChatGPT in the last two weeks, you should really do so. It is much slower now than when it launched, but still mind blowing. If it is too slow you can just use the GPT Playground, which is powered by the same back-end. GPT itself moved from 3.0 to 3.5 right around when chat launched. 3.5 is very impressive (it can rhyme now!). Spend some time playing around! It’s not often that the most interesting, most advanced cutting edge technology can be in your hands this early (and practically free). Marketing BS is on vacation the next two weeks. In early January I will be back with another podcast episode (moving to Fridays), and hopefully some more text. Have a great holiday! Full Transcript Edward: Were you a Westworld fan, Pete? Peter: That first episode in the first season was one of the most awesome pieces of television I ever saw. I was hooked with the first season and maybe watched one or two more episodes. That was it. How about you? Edward: One or two of the first season, or finished the first season and then one or two of the season? Peter: Finished the first season, that was, must watch tv. And then in my view, it jumped the shark very quickly after that. In fact, when I saw that news that H B O is gonna give up on it I thought they were just killing the program, but I didn't realize they were actually killing the, getting rid of the catalog too. That, that's crazy. Edward: Is this the first example of hbo? So HBO has pulled stuff from their catalog before, like they, they pulled some Sesame Street episodes people were upset with, but is this the first time they're pulling their own content from... Peter: It's the first I know of and indeed, the Sesame Street thing is different because that's not their content, but for them to have stuff that, that should be uniquely associated with them and still does, and on catalog basis, we'll have some value for them to say, nah, we don't need this anymore. It does have me scratch in my head. Edward: So there's no actual cost for them, whether they put it on the platform or not. There's no cost. But what there is an opportunity cost, and I think that opportunity cost has really been ignored in the past. And now they're saying, Hey, we can take this product that we have and instead of using it on our own platform, we can turn around and sell to some, sell to Netflix, sell to Amazon, have someone else owed it exclusively instead of... Peter: But it does make you wonder, like sometimes you'll sell content outright and say, here, it's yours now. Or sometimes you'll just license content. Or access. You think about lots of examples where, I don't know where Verizon will let Comcast use Verizon's phone services as a private label kind of play. So they're not giving up on it, but they're saying, Hey, we can have other access points to it as well. I just wonder if, maybe providing broader access rather than giving up on their own access makes sense. Edward: HBO has done that before, they kept Sopranos on their system, but they offered Sopranos to Amazon as well. So you can go on Amazon Prime and watch Old Seasons of the Sopranos. But what was happening there is it was non-exclusive. It was still available at hbo, but also available at Amazon. I think what's happening here is that there is a higher value in a piece of content that's exclusively available someplace else, and HBO's gonna try to realize that with Westworld. Peter: So you think it's an opportunity play for them that they'll make more money by auctioning it off to the highest bid. you don't think a kind of a cost cutting move Edward: No, I don't think there's any cost. The cost to have more video on your platform is as close to zero as it comes. The storage cost is you're storing it anyway. And I think...

Last week I published the first chapter of Peter’s new book. This week I interview Peter on the book, who should read it, what the conclusions are, how it is different from his last two books, and why he is like George Lucas. If you are interested in buying the book, you can do that on Amazon, but this week it is 40% off if you buy direct from the University of Pennsylvania press. Use the code “HOLIDAY22-FM” Full transcript below. Main Takeaways: I fed the full transcript into ChatGPT and asked it for the main take-aways from the podcast. I then probed it for more, but it could not come up with anything else. I THINK that it only “heard” the first part of the podcast and ignored the rest. But here is what the AI thinks are the take-aways: Peter's third book, titled "The Customer Base Audit," is a prequel to his other books on customer centricity. The book focuses on providing insights into customer data and is considered a foundational work. Peter believes that if the book were released first, it would not have had the same impact as it does as a prequel to his other books. He believes that starting with the "sexy stuff" and then diving into the details is a better way to grab readers' attention and get them to care about the subject matter. Full Transcript: Edward: All right, Peter. We're back. We're back. Peter: It's always good to talk to you. Ed. What are we gonna talk about this week? Edward: We're gonna talk about your book. Peter: We're talking about my book. Love it. Edward: I know there's a heck of a lot going on in the world, but we're gonna take a break from fraud and we're gonna take a break from Elon Musk. We're gonna take a break from ai. We're gonna talk about your book. Peter: We promise not to mention any of those things. Edward: We told the audience that we're gonna do it. We did an excerpt from your book last week in the newsletter. So if you those listening who have not seen that, you should go back and check that out. And now we're gonna talk to the man himself. It's interesting, Peter, this is your third book, correct? I got the number right? Peter: It's crazy, but true. Yes. Edward: Okay. And so my concern always for like big thinkers when they're writing multiple books, is that the first book. The Thing that they've worked their whole career on. It's like the first Beatles album. They've worked on it for the last 20 years of their lives, and they get it down and now two years later, they have to get another album out and they just, okay, let's see what else we can get out. And the sophomore albums tend to be weaker than the first, I feel like with big thinkers like like Clay and Christensen when he releases innovators Dilemma. Earth Shattering book blows our minds on how to think about strategy. And then he proceeds to release four more books after that, that are frankly derivatives of innovators dilemma. Are you being derivative, Peter? What's going on? Peter: Actually it's a great question. Cuz this book actually comes first, and I mean that literally and figuratively that, if you look at the, of course the book is called the Customer Base Audit, but the subtitle is the first step on the journey to customer centricity. And literally it goes back to a conversation that I had with one of my co-authors, Bruce Hardy, back in 2004 long before I had any inkling of the other work that I would then write on customer centricity. So this stuff is actually much closer to the work that I really do for a living day to day with customer data and so on. Those other books are more of the the so what, like what do we do with the these insights. But this is the book that gives the insights. This is the book that if you were to read the first two and say, wait a minute, how would I know that this stuff is true? Prove it to me. This book does that. Edward: So is This is like George Lucas making Star Wars. So after he is made that then he can go back and make the movie he really cares about, Peter: It...

Today’s episode further explores topics discussed in this week’s essay. In the preamble to that essay I said that there would be no content next week. I am going to reverse that. Next week will be an excerpt from Peter Fader’s new book. Stay tuned! Full Transcript: Peter: Ed, I love your piece on strategy versus tactics at Disney, Twitter and Dominion Cards. I love the way that you're weaving together a narrative that's taking three of the super hot, interesting topics and a fourth one that most people don't know about. Edward: It's funny, the whole Dominion Cards thing. I've been, I started playing this card game back in 2011. I went to the national Championships in 2012. And I just really enjoy it. It's like the only game I can think of where you actually need to figure out a strategy at the beginning of every game. I've been sitting on this idea of dominion cards as a way to talk about strategy versus tactics for many, many years now. And I've never felt really found the right kind of hook to put it in. And then when this thing happened at Disney on Sunday, I was like, aha, the hook is here. It's time to pull this out of the filing cabinet. Peter: Love it. Well, as a, reader of the column and as someone who thinks about these issues, there's kind of two natural questions that just has to be asked. I wanna get your take on it. So, first. How do you define or where do you draw the line between strategy and tactics? Edward: I think strategy is figuring out what you should be doing and it's trying to figure out what the end point is of where you're going for, and tactics is all the stuff that gets you there. Strategy can be done a bit in isolation. You can go back into your ivory tower and think about what the dynamics are coming out with your strategy and then tactics are going to be very much based on what's happening on the ground. What's happening at any given moment, how the competition is reacting, how economics is changing what type of people you have on your team and any given moment. Those are all tactical decisions like that a consultant is not going to be able to help you with unless he's actually there on the ground. Peter: So I always have a hard time with it, to be honest. Maybe this is just me being narrow minded or something. It's not just the next move is it the next three or four moves. Be specific about strategy versus tactics in chess, and then let's branch out to these other real world stories. Edward: I'm not an expert in chess. I'm actually teaching my kids how to play now, I'm learning along with them. But I think in chess there is a correct strategy. I think strategy in chess is things like control the center of the board would be a strategy. Be willing to sacrifice your piece in order to gain position in the board, or, move your pieces in such a way that you're able to castle fairly early in the game. Those would all be strategies, things that you're working towards over a longer period of time. Tactics are, given what my opponent has just done, what should I do next? And tactics can, you can look far into the future for tactics. There's nothing that stops you from looking nine moves ahead to the right tactic would be in that particular situation. But I think strategy stays in chess at least. I think strategy stays the same. There are correct strategies into chess and there are incorrect strategies in chess. Whereas tactics are gonna change every given game depending on what your opponent does. Peter: So let's take that, and again, it's still little fuzzy. I mean, you're being more specific, but still, and I'm not gonna press you on exactly where one begins and ends, but Disney. Disney. Disney. Disney. It seems like the narrative as you said is Iger had the strategy. Chapek's job is to come in and execute on it. Few missteps here and there. Expand on that beyond what you've said in the piece about that trade offering strategy and tactics. Edward: I think most people are agreed, even the...

I have been exploring a new AI tool that is allowing transcript creation while I edit the episodes. It’s not perfect, but it’s pretty great for those who prefer reading to listening. I plan on including transcripts of all episodes going forward. Also: Apologizes that yesterday’s essay did NOT have more than 1-second of audio. I am still working through these tools. The audio should be live on that post now (I chose not to re-send it to your email) In This Episode Fader and Nevraumont discuss Elon Musk’s plan for charging $8/month for a blue checkmark (plus other benefits). What metrics should they use to know if it’s working? Can subscription revenue compete with advertising revenue? What are the different types of Twitter users? Keep it Simple, Edward Full Transcript Edward: So, Peter, do you have a blue check mark? Peter: I do. I'm so fortunate. Of course the question is how long will I keep it and what will I have to pay to do so, and what benefits will I get associated with it? Edward: How did you get it? Was there a process you went through? Did the school help you do it? Peter: No, it was actually through my previous company, Zodiac the one, we sold to Nike. That at that point the CEO said, You know, we ought to get blue check marks just to give us more credibility. It was a pretty simple application process, but you know, a lot of people who have been trying to go through it, who are at least as qualified as I am. It seems like there is, or at least was, something pretty arbitrary about it, but hey, I'm one of the lucky ones. , Edward: You're part of the in group. When I was at General Assembly, the, my head of PR came to me like basically on day one on the job, and she's like, We need to get you a blue check mark. And I had to go and change my Twitter account was linked to my Gmail address and I had to switch it to my general assembly email address, and then she went to town and did her PR stuff to try. Get the blue check mark, but it never happened. Two years of trying it and never got the check, I even as a CMO of general assembly I was not renowned enough to get the check. Peter: That's exactly my experience cuz I think you honestly, in a position like that, deserved it more than me. I think maybe the professor thing helps, but there's plenty of professors with the big followings and great content who don't have it either. So maybe that's what the, All the musk nonsense will actually bring some order, some predictability to who gets a check or who gets which kind of check cuz there really should be more than one of them. Edward: There kind of is. So I guess for those who... I imagine all of our listeners know what's going on right now, but just a really quick summary is that Elon, there was a rumor that went out. Was it Vanity Fair or The Verge? It was the Verge last weekend that talked about how all the blue check marks are gonna have to pay 20 bucks a month just to keep it. And then yesterday we're recording this on Wednesday, yesterday, on Tuesday, Elon came out and said, No, it's gonna be $8 a month. And it includes not just the blue check mark, but a bunch of other kind of benefits, if you will. And then on top of that, really red down people like Joe Biden for example, will get a, not a blue check mark, but like an. A descriptor underneath them that says that they're authentic and real. Which was the original purpose of the blue check mark to begin. Peter: Right, right, right. Yeah. Really a validation, not just a status symbol. But if you look at some of the benefits that they're talking about, some of those benefits make sense for creators. Some of the benefits make sense for readers, and I think it's important not to mash the two together. That's why they really should be a different kind of subscription based on what you're using. Twitter. Edward: I guess so, so big part of this, it's interesting. The last essay I wrote for for marketing BS couple of weeks ago was all about paying for...

Hi everyone, Post-send note: In the original post the audio was only 1-second long. That has been fixed now. As mentioned in yesterday’s email, I will now begin including an audio version of these essays. The audio is created in my voice with an AI. For those who listen please provide feedback on the quality and whether it is worth continuing. Between Meta’s stock collapse and Musk’s takeover of Twitter, the future of social platforms dominated headlines last week. On that note, today’s essay looks at VR/AR and Meta’s new headset. —Edward Real Fidelity In January 2020 — before most North Americans had heard of COVID-19, let alone started processing its impact — I wrote a Marketing BS essay that connected the science of music technology (CD vs vinyl vs live concerts) to videoconferencing and office productivity. Specifically, I coined the term “real fidelity” to explain why our enjoyment of an experience — music or sports or work or anything, really — is significantly shaped by our perception of its “realness.” Eight months later — with many people using technology to connect with colleagues, classes, and friends — I wrote a follow-up post that expanded upon the idea: The term fidelity refers to the formats we use to communicate sounds, images, or experiences. Fidelity plays a fundamental role in the effectiveness of a marketing strategy. For instance, video can deliver a message more effectively than audio. And a video played on a large, high-definition screen is more impactful than one played on a small, low-quality screen. The most powerful fidelity is real life. A live presentation in an auditorium (usually) holds people’s interest better than a YouTube video of the event — a phenomenon that many parents discovered [in 2020], while watching children struggle with Zoom-style classes. In that second essay about real fidelity, I used the concept to explain why companies like Netflix, Meta (then Facebook), Google, and Amazon were betting on a post-pandemic return to the office. The reason? Co-workers felt like something was missing from their collaborations. Despite the improvements in technology, videoconferencing didn’t feel as “real” as face-to-face interactions. Humans crave that sense of “realness” — so much so that it drives many of our decisions. As I wrote in my first essay about real fidelity: At times, our compulsion to attend live events seems to defy logic. I would never pull up YouTube and watch an hour-long lecture, but I was drawn to go see Bill Clinton during one of his “live in conversation” tours. For an $80 ticket, I sat at the back of an enormous theater, with a view far worse than the one I could have watched on my laptop. That is the power of real fidelity. Better Fidelity On October 11, Meta announced that their new virtual reality headset, called “Quest Pro,” would ship by the end of the month — at a cost of $1500. Unlike their earlier Quest headsets (cost ~$400), the new device is aimed at the enterprise market. The Pro model offers multiple technical upgrades that support AR (augmented reality), like higher resolution, wider peripheral vision, automatic eye tracking, and the ability to see full color in both the virtual and physical environments. Plus, the device’s improved processors allow people to engage in more seamlessly immersive (and therefore “more real”) business meetings, brainstorming sessions, and more. Most pundits from the mainstream media, as well as many of the smart analysts I respect (Ben Thompson, Benedict Evans, John Gruber, Kevin Roose, John Carmack, etc.) reacted to the Quest Pro announcement with skepticism. There seems to be a critical consensus about two key points: * Meta is too early: Useful VR is still ten years away — especially the social aspects. Plus, there are limited barriers to entry; when VR tech finally matures, another company can just come along and leapfrog Meta. * Customers don’t want full immersion: Meta believes that VR is the future for...

I have been playing around with some AI audio tools. This should allow all podcasts going forward to have full transcripts. It has also allowed for pretty fantastic text-to-voice applications. I spent an hour recording my voice to have it analyzed by the AI. This allows text editing of podcasts (i.e., In the live recording I say “price insensitive” when I should have said “price sensitive”. I can use a text editor to just delete and replace and the AI will put the new words in seamlessly - in my own voice. It’s like a personal deepfake). But the tool can do more than just find and replace words. Attached to this post is the full text of last week’s essay “Paying for Status” in audio form, read in my voice from an AI. It is also available via the Substack player, and all major podcast apps. If there is any interest at all, going forward I will include audio like this in all essays (and transcripts for all audio). The AI audio is not perfect, but, to me, it sounds a LOT better than most of the “robot” customer service voices one has to deal with in every day life. I would love your feedback on what you think of it. Just reply to this email. What else to expect this week: * This week’s essay is coming (Hopefully tomorrow. It was delayed due to Halloween). Topic is VR/AR and Meta’s new headset * Weekly marketing take with Peter Fader is on schedule for Thursday morning (now with a transcript!) * For those that are interested in our analytical exploratory take on the early Marvel Universe, a new Super Serious episode will also drop tomorrow - also now with a transcript for those who prefer to read rather than listen Keep it simple, Edward This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit marketingbs.substack.com

The experiment continues. Fader and Nevraumont explore the latest earnings results where brand spend seems to be up, while direct response spend is down. This is very different than any other downturn we have seen in the past. What is going on? We explore at least three theories. Thank you for the feedback on last week’s episode. I WILL work on getting some sort of “instant transcript” for these so they can be read as well as heard, but it may take me a while as it does not land on the top of my priority list. In the meantime know that these are very short and only once a week, so hopefully their value per minute of your time is high. Keep it simple, Edward This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit marketingbs.substack.com

A new experiment! Wharton Professor Peter Fader and I are going to try something new. Ever Wednesday (give or take) we will spend 10-20 minutes discussing the marketing implications of something topical in the news. In this first episode we discuss the parallels between P&G’s recent announcement that they are raising prices, and Netflix’s recent earnings call (and their move into a lower-priced ad-supported tier). Some relevant links: Peter’s two part interview with Edward in November 2020: Part one. Part two. A 2019 essay about Amazon Prime Day and discounting where I quote Peter: Happy Double Prime Day The WSJ article we discuss in the episode (free link) The October 18th, 2022 Netflix earnings call transcript. We would love your feedback on this experiment. Please reply to this email with your thoughts. I will forward all messages to Peter (unless you tell me not to). We do NOT have transcripts for the episodes yet, but if there is interest I will work on a solution. The provider I have used for my CMO interviews would be too slow, but there are acceptable AI solutions now that should be able to turn things around quickly at reasonable quality. Keep is simple, Edward This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit marketingbs.substack.com

This is Part 2 of my interview with Stuart Wood (CEO of Caravel Law). Part 1 here. In this part of the interview we talked about how one goes about marketing professional services firms. Stuart marketed both the leading firm in Canada, and now oversees a “start-up” law firm. There are some similarities and some real differences in how marketing is done in these environments. I hope you enjoy this - it is a little different than our normal discussions on Marketing BS. Transcript: Edward: This is marketing BS. This is part two of my interview with Stuart Wood. Today we're going to dive into his experience overseeing marketing at two Canadian law firms, Caravel and Torys. He was CMO at Torys and CEO now at Caravel. You were CMO at Torys, which is a very, very established law firm in Canada. Now you're CEO of Caravel, which is a much newer law firm, relatively new. How do law firms differentiate themselves? What makes someone choose one law firm over another? Stuart: It's a challenge for every law firm, I think. Because what you'll see, if you look at law firm marketing, there's a lot of the same language, a lot of the same descriptors that they're trying to use for themselves. There's a lot of generic terms that are used. You'll see a lot of advertising, which are things like chess pieces and these strategy images that they think are going to really differentiate their firm, but it really is a lot more and more of the same. We try to differentiate ourselves in a few ways. But one of the keys for us is to try to differentiate through innovation and our business model. We've taken a lean approach to legal services, the same way that I applied lean principles to different businesses when I was a consultant, playing them here at Caravel as we take out everything that doesn't add value to the client as a way of trying to get the costs as low as possible. We practice in a different way where our lawyers—well before COVID hit—all practiced remotely as a way of eliminating the cost of a large expensive office on Bay Street. That means that we attract talent—great lawyers that have 15+ years of experience and just for whatever reason are looking for the flexibility of being able to work remotely. Nowadays, that's something that all law firms are trying to do, but for the founders of this firm 15 years ago, it was a pretty innovative idea to get rid of the office and have all the lawyers practicing remotely. We try to essentially implement legal technology in a way that actually delivers value for the client as opposed to just looking good in a press release. We use contract automation software and different things so that it feels different when our law firm is working with you versus when you're working with a traditional firm. We're not trying to just be a less expensive version of a traditional firm. We're trying to feel different from the client when we provide our services. Then lastly, I think law firms really try to differentiate on service. It's hard for me to compete with a big firm that has a team of staff on a client floor—the art collection, the filtered water, and everything like that that gets delivered. We have a director of client happiness and another person who works in our client happiness department. We really try to distinguish ourselves in the way that we care about our clients and pay attention to what's going on in business and how we can be helpful. Edward: A lot of those things sound like great ways to make your clients happy and to keep your clients from churning, from sticking with you. They don't sound like top-of-the-funnel ways to get people to even know about your firm, to consider your firm, or to select your firm when they're deciding which firm to choose. How does someone know? Do you do marketing to let them know that, hey, we have a different model, come and check us out? Stuart: Yeah, we do. Some of that is through the types of work that we do. We really try to grow through referrals. We...

Thank you for your patience as I take time with the new baby. It has been pretty great barely working (professionally) for the last six weeks. I have half-written a briefing that I keep thinking I will finish and send, but it continues not to happen. I have not decided when I will really ramp back up. In the meantime, here is another Marketing BS interview. This one is pretty unique. Stuart was CMO of the largest law firm in Canada without ever being a lawyer (and is now the CEO of a newer firm). Part one, like always, is about his career. Next week I will drop Part 2 which explores the mechanics of how he thinks about marketing a law firm (with all sorts of learnings for service businesses). Enjoy. The Transcript: Edward: This is Marketing BS. My guest today is Stuart Wood, CEO of Caravel Law. It's a leading law firm based in Toronto, Canada. Today we're going to cover Stuart's path becoming a CMO and now CEO of a law firm, but not actually a lawyer himself. He was at Loblaws, McKinsey, Torys, Exact Media, and more. In the next episode, we'll dig deeper into what it means to run marketing for a law firm. But today, I want to focus on Stuart. Stuart in 2005, you were an engagement manager at McKinsey. It's not uncommon for people to leave McKinsey when they're engagement managers, but it is fairly unusual to leave and become a CMO immediately. It's also extremely unusual, I think, to leave work for a law firm. Tell me exactly how that happened. Stuart: The main reason that it was unusual was that I joined a client that I had been serving as a consultant. I had a consultant's worst nightmare. You put forward a series of recommendations and then the client turns around and says, well, hey, why don't you come on board and do all this stuff that you said we should do? The list of recommendations that I had made was now recommendations to myself. I was in a unique situation of trying to take all the analyses that I've done and all the recommendations that I had put forward, and now put them into action. It was a unique opportunity, a chance to implement what I had seen. I'd had a chance to work with the team for three and a bit months. I really had a good feel for the people. I really liked the environment. I really liked the leader of the firm, Les Viner. I jumped at the chance to join the management team at Torys. Edward: You came on at that project work, the McKinsey work you were doing for them. Was it a marketing project? Stuart: No, it was really a full strategy review for the firm. The firm had expanded into the US and had done a number of interesting things. We're five years onwards, wanted to take a look at some of the decisions they've made, whether they still made sense, whether there were execution issues that they could tighten up, that kind of thing. So I came in and led that project to make a set of recommendations overall for the firm. Edward: Who was the individual at the firm that was your client? Who was thinking through the strategic problems that you're giving these recommendations to? Stuart: I've worked most closely with the managing partner at the firm. But I really worked closely with the entire executive committee, which was made up at the time, I believe, of seven senior lawyers at the firm including a managing partner. Edward: They were all lawyers. They were all practicing lawyers who were presumably trying to hit billable hours, targets, and billing clients and managing teams, and then they're doing this on the side, which is like, what is the strategy of our firm going to be? Stuart: Yeah. The managing partner at that firm doesn't actually practice and doesn't work with clients any longer. His full time job was running the firm. But the other six members of the executive committee were active leading senior partners inside the firm who ran practice groups, had responsibility for the most important clients at the firm, that kind of thing. So they had to juggle all the strategy...

You can find Part One of my interview with Vineet Mehra here. In Part Two of the interview I spoke with Vineet about his time at Walgreens. We talked about what makes Walgreens/Boots different from CVS and their other competitors. We dove into how Vineet used the vast amounts of data Walgreens was collecting (>80MM people in their US loyalty program) to fairly radically change business processes (including eliminating the flier completely). Enjoy. Transcript: Edward: This is part two of my interview with Vineet Mehra, Chief Growth and Experience Officer at Good Eggs. Today, we're going to dive into his time as CMO of Walgreens Boots Alliance. Hey Vineet, I think we can safely assume that our listeners are familiar with Walgreens. Walgreens is slightly behind CVS in terms of number of pharmacies in the US, but you're way ahead in terms of number of pharmacists. You can say the similar thing in the UK. Boots has almost twice as many locations as the number two player, but more than three times the number of pharmacists. Let's start there. Why do Walgreens and Boots have so many more pharmacists per location than their major competitors? Vineet: At the very core of Walgreens—and we'll focus on there for now—is this idea that the biggest asset the business had even in a digital age was that Walgreens had the best corners in America in terms of where our stores were located. You go to any major city, any suburb of a major city, places where you least suspect a Walgreens, and it's on that perfect corner. It's easy to get in and out of. It's centrally located. We had a Walgreens within 2–5 miles of every single person in America. That makes a really big difference in a business. Even in a digital age, believe it or not, physical location matters. I'm sure we'll get more into that, but that was a big part of what our difference was. Edward: Does that explain why you have more pharmacists? Because every location you have is a busier location than where your competitors are placed? Vineet: Yeah. We had some extremely busy locations and good corners where there's a lot of traffic. That probably does explain some of that for sure. Edward: How does the business do that? Is it just because you guys were around longer? It feels like every pharmacy would want to be in the best location. Why did Walgreens get the better locations and your competitors did not? Vineet: I definitely wasn't around for that period, but I'll tell you that the history of the company is fascinating at Walgreens. That idea of the best corners in America has been something that's been permeating in the company for multiple decades. While it sounds obvious, it's also not the cheapest play to go and acquire the best real estate in the country—the best corners—and build those out. I wouldn't say that that is the most obvious play in terms of economics, but Walgreens always had foresight. The team that built up this business up to almost 9000 stores across the country really focused on that fact. Isn't that how most great businesses are built? There are two or three things that initial leaders and founders think about, and they're uncompromising about it. In the case of Walgreens, it was all about finding the most convenient and easy locations for customers and patients to take care of their health. Edward: Does that philosophy continue? I know you used the word convenient. Clearly, most drugstores, pharmacies, and convenience stores—convenience stores even have the word convenience in their name. How much of that flows through the company, this idea of convenience? Being in those great locations is convenient. Are there other things that pushed you in that direction? Vineet: It's really about enabling people to take care of their health, but this idea of convenience is something that—as you see today—is all over the place. Convenience is taking different shapes and forms. Especially in a world like today where we live in an omnichannel world, people want to...

I delayed this week’s edition on the hope I would spend Tuesday after the long weekend completing a briefing. I have a ton of great stuff to share with you all, but the time to write it all down did not happen. Instead I want to share with you a great interview I did with Vineet Mehra. In part one we talk about Vineet’s big break to a head of marketing role in his early 20s, and how he leveraged that into the career he has today. Lots of great stuff in here on how to think about things like “General Management roles” vs. “Functional Area Leadership”. Part Two will cover some of the fascinating work he did at Walgreens. As always you can listen to the interview in any podcast player (click on the link next to the imbedded audio for the links. Transcript Edward: My guest is Vineet Mehra, Chief Growth and Experience Officer at Good Eggs. Today, we're going to cover Vineet's path to CMO: P&G, General Mills, Novartis, Avon, and Johnson & Johnson. He was a CMO of Ancestry, CMO of Walgreens, and now at Good Eggs. Vineet and I worked together two decades ago at Procter & Gamble. Super pumped out on the show today. Vineet, let's start off: You've had a killer career, but I'd love to talk about a few of the big leaps that you had. If you want to start, in 2008, you went from a Marketing Manager at General Mills, and then you took on the Head of Marketing job for all of Canada for Novartis. Talk to me a little bit about how you made that transition happen. Vineet: First of all, Ed, thanks for having me. Obviously, it's so great to see you after almost two decades. I remember us playing foosball in a room as account managers trying to grow our businesses at retail over there in Canada. It was a real highlight of my career, I remember. It's great to see everything you've done as well. I have definitely had a couple of leaps that have happened. This specifically that you're talking about—going from General Mills over to Novartis Consumer Health in Canada where I had the opportunity to run that business—was honestly a little bit of good luck and a little bit of knowing the right people at the right time, which truthfully, if anyone tells you anything differently, that's how a lot of us get our first big leaps. In this case, there was actually a headhunter or a recruiter in Canada who knew me from the time when I was an assistant brand manager. She happened to be doing this search and just thought, hey, why not? Why don't I just throw his name in the hat? It's a long shot, but you know how recruiters need to build this portfolio of candidates—the young up-and-comers, the established players, and the people in the middle. I think I was just thrown in as the young up-and-comer. Like yeah, we'll just give you the high-energy 20-year-old and see what happens. It just so happened that the President of Novartis, Canada at that time—who, by the way, is still at the company, running the Global Oncology business now, he's an unbelievable talent—took a liking to me. We met a couple of times. One way or another, the headhunter's long shot, 20-year-old candidate ended up getting the job. There I was, I ended up becoming the Head of Marketing for Canada. For those of you that are Canadian listeners, Novartis has brands like Buckley's, NeoCitran. These are just unbelievably Canadian brands. It was such a great opportunity to spread my wings for the first time. But knowing the right person, luck, and just going for it (I guess) played a big part in that leap. Edward: I definitely have been in places like that where the headhunter brings you on and you're like, I am clearly not the right person for this role. You totally have me there so that you can show them a balance of range of, hey, here's the person that's much less experienced than the person you need and here's the person who's much more experienced but way too expensive. Let me just show you what they're like out there so that when I show you what you really need, you actually jump at...

This is Part 2 of my interview with Angela Rizzo. Angela was the CMO of eSentire, a leading company in the cyber-security space. Since the recording of this episode she has left eSentire and is looking for her next opportunity. If you would like to get in contact with her, please just reply to this email. (For all interviews you can click on the link next to the audio player to add the stream to a podcast player). I expect to be back with an essay or briefing next week. I will also be going back to dropping a second post per week with interviews shortly. Enjoy! Transcript Edward: This is Marketing BS. This is Part 2 of my interview with Angela Rizzo. Today, we're going to dive into her experience as CMO of eSentire. Angela, can you start by explaining what eSentire does? Angela: Yes, I'd be happy to. At eSentire, we provide an affordable, premium cybersecurity service with end-to-end proactive protection. eSentire invented a new category of cybersecurity. We call it Managed Detection and Response and I'll refer to that as MDR. MDR was invented to do two things—detect the fact that bad actors are attacking a customer environment, and then take action to contain the attack before the bad actors can do any harm. We think of these attacks in three categories—vulnerabilities, threats, and breaches. Vulnerability is defined as a weakness in a customer environment like a bad patch management practice. A threat is an exploit of the weakness by the bad actor. That's where they're trying to get into the environment. A breach is the successful exploitation of a threat. That means they're successfully able to get in. We monitor and manage for vulnerabilities, threats, and breaches. Time is critical to detect these things. Once we detect something, we then isolate and contain the attack. Edward: There are thousands of cybersecurity companies out there now. What are you doing? What is eSentire doing that's different? Or is it a matter of you're doing the same as everybody else? You're just doing it better? Angela: Managed Detection and Response is its own unique category. We have to think back to the fact that cybersecurity is a massive data analysis problem. In order to effectively provide cybersecurity protection, you have to be able to find the needle in the haystack. This is the simplest understanding of what we do. We do this in combination with three key things. First, we have our Atlas platform. There is a term that is going around right now in the analyst community and in the market called extended detection and response or XDR. This is the platform that is needed to ingest, normalize, and analyze all of this data. The second thing we do is called multi-signal ingestion. There are some cybersecurity companies out there that just ingest one signal. They'll do endpoints, or they'll do logs. We ingest multi-signals. We monitor customers' networks. We work with best-of-breed third-party companies, and we ingest their endpoint signals. We just announced our alliance with Microsoft to ingest the Microsoft Defender endpoint signal. Customers who have Microsoft licenses can work with eSentire and eSentire can manage the MDR associated with the endpoint. Edward: If a company isn't using you then, are they not analyzing these endpoints? What are the other cyber companies doing? Angela: I mentioned there were three things. You've got the platform, the multi-signal, and then the people within the SOC, within our Security Operation Center, and within our threat response units. You have to have the combination of these three things to be considered MDR, Managed Detection and Response. Many cybersecurity companies are either selling a point solution, or they're selling software, or they're claiming that they're selling MDR, when in fact they don't have all three of these things working in unison. Edward: Does a company need to use you in addition to someone else? Are there other elements in cybersecurity that you guys don't handle...

I wasn’t sure I would have a new essay for you this week. Unfortunately the new kiddo has had to spend more time in the hospital (nothing serious, but out of caution “just in case”). I’m not worried about him, but it has taken up a fair amount of time (beyond the normal baby-taking-care-of time). Rather than leave you with nothing this week (and next) I am polishing off this interview that has not been released yet. Angela WAS the CMO of eSentire, a leading company in the cyber-security space. Since the recording of this episode she has left eSentire and is looking for her next opportunity. If you would like to get in contact with her, please just reply to this email. (For all interviews you can click on the link next to the audio player to add the stream to a podcast player). Transcript Edward: My guest today is Angela Rizzo, CMO of eSentire. Today we cover Angela's career and path to CMO—Sprint, EDS, Hewlett-Packard. Angela is now the CMO of eSentire, the global leader in managed detection of cyber threats. I'm super pumped to have this discussion. Angela, you were recently promoted from VP of marketing to CMO. How has your job changed? What did you do to get that promotion? Angela: I joined eSentire as VP of marketing in July of 2018. When I came on board, most of the marketing focus at that time was on face-to-face events. We knew that we needed to add more programs that delivered higher quality marketing-qualified leads. I realized that the team was really talented. They just needed a bit more direction and leadership support. I moved quickly to work with the team to expand our focus from an events-only focus to include integrated campaigns, focused on what issues the customers were really grappling with, and how eSentire MDR could solve those issues. We started doing more paid promotions—Google display ads, paid social media, SEM, SEO. I put in a lead-scoring program. We also started doing a lead-nurture program. We started to build transparency in reporting by creating new marketing dashboards in the sales force that covered everything from where were these MQLs being created to how much pipeline were we actually generating that was marketing-attributed. Edward: You were doing all that as the VP of marketing, or you didn't start doing that until you became CMO? Angela: That's correct. That's what I was doing as VP of marketing that I think led to the promotion to CMO. Edward: What happened when you became CMO? How did the job change? Did you take on other responsibilities, or was it just an escalated title and compensation package? Angela: No, I did take on more responsibilities. I actually took on the corporate comms function which I had never run before. That included analyst relations, public relations, community relations, and employee relations. This was January of 2020. I get the promotion at the end of the month, and then COVID hits at the end of February. Now, I'm finding myself focusing on how we need to communicate to our customers on what's going on with the company so they can be assured that we're still going to have 100% operations. Edward: Did you have any experience doing those things before you became CMO? Angela: No, I did not. Along with putting together the customer communications, we also worked doing employee communications. We were at a point prior to the pandemic where we were doing quarterly employee all-hands. We actually went weekly once the pandemic hit in March. We were actually pretty fortunate, Ed because the company was prepared to have every single employee work from home. Everybody started working from home in mid-March, and we were doing weekly all-hands meetings. As the CMO, I was actually pulling together the content, making sure that these meetings got scheduled. Our CEO and entire leadership team participated in every meeting because we felt that it was just critical that we kept everybody up-to-date on what was going on. If you recall, a year ago nobody really knew...

Sam Heath and I worked together at McKinsey many many years ago. He is now responsible for marketing Tim Horton’s in Canada (where it is by far the largest quick service restaurant chain), and Timmie’s fledging business of selling its product in grocery stores. Last year, out of nowhere, Sam’s heart stopped and he “died”. Last week we explore how that event affected him and his overall career in this episode. This episode dives into Tim Horton’s - both the stores and the CPG products - and how he is growing the two inter-related businesses. You can also listen to these interviews in your podcast player of choice: Apple, Sticher, TuneIn, Overcast , Spotify. Private Feed (for premium episodes). Transcript: Edward: This is Marketing BS. This is part two of my interview with Sam Heath. Today, we're going to dive into his experience as head of retail for CPG and Tim Hortons. Sam, we're both Canadians, and every Canadian in the country understands Tim Hortons down to their bones. But for American listeners, can you describe a little bit what Tim Hortons is and what it does? Sam: This might be a little bit of a long answer and I'll come at it in two ways. One way, our former CEO tried to describe this to everyone at Burger King right before the merger happened. He said, imagine if Coke operated restaurants in the US and there was no Pepsi, which is a pretty good idea of how important the brand is. Fundamentally, it's a coffee shop/ breakfast/ lunch space that has about a 50% share of the QSR market in Canada, which for context is the sum of what the next 13 chains combined. The next chain is McDonald's. It's just absolutely massive in terms of what it means for Canadians who want to eat. Edward: In the US, McDonald's has the number one share of the QSR market, is that right? Sam: Yes. Edward: What percentage would McDonald's have in the US roughly? Sam: I'm a few years away from this, but probably 20%, 25%. Edward: Got it. McDonald's is in the US, Tim Hortons is at 2 ½ times that in Canada. Sam: It's the only market McDonald's operates in globally where they're not number one, and they're a distant number two to Tim Hortons in Canada. Edward: Got it. Tim Hortons is almost even more than that in Canada. I don't think there are many Americans who define themselves by McDonald's, but it almost feels like there are Canadians that define themselves by being a part of the Tim Hortons community. Sam: Yeah, and this is the other way that I wanted to try to get at it. If you're a big fan of an NFL team, or maybe even better, a college football team in the US—that type of just extreme buying of what that brand means to you, what that team means to you—that's the place that Tim Hortons takes in Canada. College sports are just much less important. People get Tim Hortons tattooed on themselves regularly. Weddings happen at Tim Hortons every year or two. People choose to get married there. It means things in a way that I don't think anybody truly understands. Edward: How does that happen? At the end of the day, they serve donuts, coffee, and sandwiches. Why are people getting married at Tim Hortons? Sam: In the 80s and 90s, a big problem for Canadians is who are we as a country, as a people? All of the answers up until that point, it's we're like Americans, but—we're less this than Americans, we’re more this than Americans. Sometime in the mid-90s, there's a book published called Timbit Nation that tried to answer this. The book said we’re a nation of people that have Tim Hortons and go to Tim Hortons, to a lesser extent Canadian Tire. The way the brand got there is it is a brand by Canadians for Canadians. It's always being 100% franchised. The people running Tim Hortons restaurant have been members of the local community. There’s been this really intuitive sense of how you make coffee, donuts, bagels, breakfast sandwiches, and things for the people that are around you that are like you. No one ever planned strategically. It just...

Sam Heath and I worked together at McKinsey many many years ago. He is now responsible for marketing Tim Horton’s in Canada (where it is by far the largest quick service restaurant chain), and Timmie’s fledging business of selling its product in grocery stores. Last year, out of nowhere, Sam’s heart stopped and he “died”. We explore how that event affected him and his overall career in this episode. Next week we dive into Tim Horton’s - both the stores and the CPG products - and how he is growing the two inter-related businesses. You can also listen to these interviews in your podcast player of choice: Apple, Sticher, TuneIn, Overcast , Spotify. Private Feed (for premium episodes). Sponsor Message Get paid for your feedback, join Wynter’s research panel Want to give back to the community while having a low-key side hustle to fund your habit? Provide feedback on product messaging for industry-leading B2B companies, be compensated every time you do it ($15-$50 per survey). Takes ~10-15 min to take one survey, low-key time commitment. Transcript: Edward: My guest today is Sam Heath, head of retail for Restaurant Brands International. That's the CPG group for Tim Hortons. Today, we cover Sam's path to overseeing the restaurant chains, the entire CPG business—Brown, McKinsey, OLG, Burger King, and Tim Hortons. I worked with Sam when we were both at McKinsey Canada. I'm excited to chat with him today. Sam, in 2015, you were the Senior Director of Innovation for Burger King, but then you left that to run all of marketing for Tim Hortons Canada. You've never had a marketing title before. How exactly did you get that role? How did you jump from running innovation to running marketing? Sam: At the time, Burger King was a little bit crazy in a way that I describe match my type of crazy. They took people that had done well in whatever roles that they'd had and gave them more stuff to go do. I'd look at marketing. I've done analytics. I've done other things like that, but I'd never done the actual direct-to-consumer go get impressions, sell the product, sell the brand marketing. It was a really pretty big jump. It was taken by the people I work for on faith that I could do a good job at it. Edward:At that time, Burger King owned Tim Hortons. It was one organization. Sam: When I joined, it was just Burger King, but when they moved me up, it was about a year after the merger had happened. Edward: You had delivered for them around innovation. They said, hey, we trust you to run innovations. Now, we're going to trust you to run marketing. Sam: For the most iconic brand in all of Canada, yes. Go from this team of six people that are sampling hamburgers in the test kitchen. Why don't you take over this team of 70 with a $300 million marketing budget up in Canada? Edward: Why did they think you were capable of doing that? I know you're capable of doing that, but why did they think you were capable of pulling that off? That seems like a big risk. Sam: It is a big risk, but it was taken by people who had taken risks like that at Burger King and seen them paid off. They also were willing to replace me if it didn't look like it was working. Edward: You said they took risks like that before with you, or are they just risk-takers in general? Sam: Just risk-taking in general. It was very much the culture of the organization. This was a bunch of people who looked at Burger King and said, this is a good brand—it's just clearly not doing well back in 2011—bought it and said, we need to change everything to turn this around. They went from a 300-person organization in 2011 when they acquired Burger King, I think about 20 of those people were left when I had joined 2½ years later. Edward: When that opportunity came up, did you put yourself forward for it, or did they come to you and say, hey, we have these gaps. Sam, can you step into it? Sam: It was very much the second. They said, we have this gap. The semi-annual upside is what's...

My editor lost Internet yesterday causing the Tuesday essay to be delayed. It will be released later this week. In the meantime here is part two of last week’s interview. My guest today is Charbel Zreik, managing principal Manifestation Capital. In 2012 Charbel founded a search fund, purchased DCI (a hospitality-focused telecom company), successfully turned it around, scaled it to a national footprint and then sold it. He now advises entrepreneurs attempting to scale similar sized businesses. This is Part 2 of the interview where we talk about DCI and how he turned around and scaled the business. Yesterday we explored Charbel’s career and path to CEO. You can also listen to these interviews in your podcast player of choice: Apple, Sticher, TuneIn, Overcast , Spotify. Private Feed (for premium episodes). Transcript Edward: This is part two of my interview with Charbel Zreik. Today, we're going to dive into his experience as CEO of DCI. Charbel, can you start by explaining what DCI does or what they did? Charbel: Yeah. DCI—when I acquired them—went into hotels around the country and put in telecommunication systems. They put in the phone systems that managed all the phones in the room—including putting all the phones in your room, but also they put on the telephony that managed the call center, the software that managed the call center where the calls came in to make reservations and things like that. At the time, they had just started doing WiFi management. Going in and putting in all the access points to transmit the Wi-Fi, to design the WiFi system, and what’s going to get perfect WiFi coverage in a hotel. As well as take the calls from the hotel guests when they couldn't connect to the WiFi system so that it's remote monitoring of the system and remote help desk support. Edward: Was DCI a commodity then? I assumed that you didn't have a monopoly on this business all across the US. What did hotels do, that you weren’t using you? Charbel: Yeah, we did not have a monopoly at all. Mostly they had other service providers like us. But sometimes they had local guys—just random Joe Doe, two men in a van that went around and did IT support for the local hotel. Yeah, we had local competitors. There were 10 or 20 other national competitors like us doing the same thing. And in the rare situation, they had their internal IT guys doing it. Edward: What made you different from the other 10 or 20 other companies doing what you guys are doing? Charbel: At the end of the day Ed, it was two things. One was just service. Literally, the reputation that we had around jumping through hoops and being able to contact the owners at DCI in the middle of the night when things went wrong to make sure that you weren't getting some random person in a call center, but you were getting the highest level of expertise to solve your problems. That was one thing. The second thing was that we did more than one thing. Yeah, we were just starting out on WiFi at the time. But when we did the telecommunication system and the WiFi system, they really liked that because it was one throw to choke and it wasn't having to go to multiple places. Because these systems ultimately were interdependent on each other. Edward: Most of your competitors were doing one of the two? Charbel: Most of the competitors, exactly. Edward: If you’re a hotel, you’d have a WiFi provider, you’d have a telephony provider, and you guys come in and replace them both? Charbel: Exactly, and sometimes, when one went down it was the fault of the other. To troubleshoot it, you'd have to go through the process with the first vendor, and then they'd be like, hey, we can't find anything. Our system is saying it's the other vendor that's down. You're going back and forth between the two to try to figure it out. Edward: What did you see when you made the acquisition? What was the opportunity there that you thought you could buy it and make it worth more than what you bought it...