One of the things I’ve been trying to do better this year is listen to my customers.

It seems listening is a very difficult skill to learn. Asking a provocative question is one thing; listening well to the answer is quite another. Really listening depends in part on making yourself innocent again. Within any company, learning from what you are listening to means divesting yourself of all the baggage a brand has acquired over the years. It’s so easy to hear something a customer says and quickly respond, “We’ve heard that before” without really listening to what that particular person is trying to tell you.

Listening does seem incredibly basic. Yet the reality is that all of us are often distracted and don’t bring all of our skills or faculties to a listening situation. Have you ever left a meeting and wondered, “What did they just say?” When you are out listening to your customers, the first thing to remember is to clear your mind and enjoy the very human process of listening. This is a difficult thing for most of us to do.

The overall goal of listening is to see patterns where others see chaos, and to make meaning that is well grounded in both experience and intuition. To achieve this goal, you have to capture the Vox Populi, or the voice of the people. Here are some things to remember:

Concentrate – It is very difficult for companies to concentrate. There are spreadsheets to fill out; there are sales to be made and the bottom line to look after. How can anybody take the time to concentrate on listening with so much to do? Yet concentration is absolutely essential to effective listening. Be

Free From Anxiety – This is, possibly, the hardest thing for a company to do. As a businessperson you know how hard it is to not focus, always, on the bottom line. It is hard to not be anxious about getting a product or service to market. Likewise, it is also hard not to think about accomplishing specific goals when you are talking to a customer. This, however, is the only way to have a successful dialogue in which you are able to hear clearly.

Imagine – Aren’t all great companies started by someone with an amazing imagination? Look at Apple: it was Steven Jobs and his imagination that created the personal computer that fueled a revolution. Likewise, Nike’s Phil Knight spent his first few years selling shoes out of the back of a station wagon. They were both out there with their customers, listening and learning. They were imagining ways to solve problems, whether for computer users or runners. Every great company has a heritage of myth and imagination surrounding its start.

Empathize – At the foundation of most great companies is a group of people that embodies the passion and commitment of their customers and has a vested interest in doing things right; in essence, empathy can be defined as the ability to relate to customers in an intuitive manner. The most straightforward way to attain this is to be a passionate user of your company’s products. Understand – Understanding is not about simply downloading a bunch of numbers and statistics and then analyzing them from behind a desk. In this context, it means feeling an impact in the heart and soul. It is an understanding that comes from experiencing what's really happening.

Love – While many businesspeople might laugh, this is the start of great listening. Great companies don’t just like their customers – they love their customers, and their employees too. Look again at Nike and Apple. Both companies are on crusades with their customers to change the world. And their customers can feel the love. They recognize that these companies really care about them and want to spend time with them. It’s all about letting people talk and tell their stories without any screens or interruptions. It’s about slowing down enough to have the time to engage people in a passionate dialogue while in the context of their lives.

I’ve been thinking a lot about the power of reputation and the potential it has to have a disruptive effect on marketing. The fluid reputation marketplaces, like ebay and Amazon, have certainly challenged the power of branding.

 Because reputation can play such an important role in the way people relate to brands and companies, it’s important to think about how to make sure you stay engaged in managing your reputation in this bottom-up economy.

 Here are some things to think about:

 Research Your Reputation – Think about what kind of reputation your company has. Is the internal view of your company consistent with the external view?

 Understand Your Reputation – Who really owns your products and brands: you or your customers? Is your company ready to acknowledge the illusion of control and start to listen to what people really have to say about you and your products?

 Tap Into the Conversation – There is a current conversation going on in the world about your company. It’s hard to really listen to the conversations that are happening in the marketplace unless you get out of your office and seek them out.

 Let Go – The idea that you can completely control your reputation is another illusion. While it can be valuable in the long term, try to let go now and then and focus on the relationship with your customers in the context of the journey. Enjoy the day-to-day experience.

 Participate in Improving Your Reputation – The best way to start participating is to ensure that the actions of your company are consistent with your philosophy. Do you do what you say you’re going to do?

(After some 1200 posts I've been looking back on some of my favorites. Here's one from December 02, 2005. Enjoy.)

John Moore’s post over at Brand Autopsy entitled, Capitalizing on Conversational Marketing reminded me that with the buzz about word of mouth marketing and the importance of storytelling there is a lack of discussion on what it takes to tell a good story.

I agree that we are in the twilight of a society based on data. In the coming years, brands and companies will not thrive on the basis of their data, but on the strength and meaning of their stories, creating products and services that evoke emotion.

Products will become less important than the stories they convey and the way those stories are interpreted and shared. It is a return of the ancient form of narrative. Companies need to have stories to tell – stories that inspire action. And companies must themselves embody those stories with congruency and authenticity.

When developing a story, there are some essential qualities any narrative must have:

Context – The story must be in the context of the audience’s experience. You want the audience to think about their own experiences and stories and be able to see themselves in the story.

Simplicity –Simplicity equals power. A story must be simple and to the point.

Interest – A boring story is just that. It will do nothing to inspire action or promote understanding. A story has to be interesting enough for the audience to register it, remember it, and tell it again.

Trust – The best stories are stories that are actually true. I don’t mean true in a scientific context, but true to the audience’s experience. It’s amazing the trust that is created when you feel the audience saying that they’ve been in the same situation. True stories evoke in an audience an attitude of “I can do it, too.”

Meaning – A story must get across a strong message that inspires the audience to rethink something. The story is the structure or framework that adds support to the deeper message being conveyed. It’s easy to get lost in the story itself and forget why you are telling it. Remember that a story is not just a way to illustrate the analysis. Rather, the story’s job is to convey meaning from the analysis and act as a conduit of understanding.

Connectedness – To be successful, the story must connect the audience with the inspiration you are trying to convey and to customers with whom the audience can empathize. It is vital to get the listeners to mentally place themselves in the shoes of the customers.

Magic – A great story often violates the listener’s expectations. There is a surprise. This gift is usually an action that has resulted in laying the groundwork for profound inspiration in the story. Remember to plant the seed of the idea of the center of the story and let them invent the missing elements.

Relevance – To be successful, a story must embody the inspiration in such a way that the audience will almost intuitively know what to do with it. If the listeners are given the opportunity to co-create the story, they will believe that it is their story and will be more likely to become champions of the inspiration you are trying to share.

Immediacy – Stories are efficient. In today’s ADD society it isn’t possible to detail all of the data to scientifically prove your point. A story helps people take the leap of faith necessary to be inspired to take action.

All of these companies have been seen as very innovative at one point in their histories. But, like most companies innovation happened at the fringes. Whether it was bringing in a new leader, making an acquisition or launching a new, paradigm shifting, product innovation has come to usually mean swat teams working at the edges. 

While Kodak created digital photography it was siloed on the edge so that it didn’t disrupt the core, moneymaking divisions of the company. Likewise, those divisions weren’t focused on or compensated for innovating but instead on running their businesses as efficiently as possible.

It happens in every industry. Look at book publishing. Originally, book publishers were all about nurturing authors and building a relationship with readers. It was an intuitive process run by editors that had a “feel” for the business. Certainly, there are a few great editors left but as the business grew it was much more important to focus on the production and distribution of books than it was on developing authors. It seemed to make sense because that’s where all the costs were and a small savings could be leveraged into larger profits right up until the moment that putting ink on paper and books on shelves became suddenly irrelevant.

It’s not unusual. Every business goes through the same cycle. It becomes conservative when it has something to conserve.

And, it’s only natural that innovation gets pushed to the sides of the companies. 

The bolt on approach to innovation might have worked in the past yet with the speed of change brought about by technology and the radical transparency of social media nurturing innovation as the rest of the company does “the real work” is a model that’s threatened.

Maybe it’s time to give up on innovation and focus on transformation. From the bottom-up. From the core of the company out. Maybe it’s about transforming the most profitable parts of the business first instead of last.

If you not willing to disrupt yourself first by focusing on transformation then there are a lot of folks out there that would be happy to do it for you.

Suddenly, The Kodak Moment takes on a new meaning.

I believe that capitalism runs on the inefficiencies in any given market. These inefficiencies force evolution. They force change and innovation. Often rendering old business models irrelevant.

I’ve seen this over decades. Looking back, the change that’s happened, and the pace at which its taken place, is hard to fathom.

I was born into media. Ink in my veins. Four generations of newspaper owners. I’m not talking about Hearst kind of newspaper owners. I’m talking about newspaper owners from the other side of the tracks. The kind of newspapers like the Canton Daily Ledger or the Oqwauka Current. Local, family-style affairs. (I just checked Facebook; The Current now has 33 followers.)

At my dad’s paper (and, my grandfather’s before him) everyone was involved. The same people wrote the stories, typeset the paper, and ran the presses. Back then, it took 35 people to put out The Canton Daily Ledger.

When I was a kid, before I became a paperboy, I’d go down and hang out with the typesetters. These guys were all about the craft, all about the process. They’d melt the lead, pour it into the Linotype machine  - a big, frightening contraption, like something out of a Steampunk nightmare. Then they’d pull the letters from the Linotype and organize them upside down and backwards on a special rolling brass table. A few quick moves of their hands and presto, the page was laid out. They were fast. They were passionate. They were craftsman.

By the time I joined the paper – not counting my time as a paperboy – I was in high school. The linotypes were pretty much gone. And with them legions of craftsman. Folks who’d worked for decades to create the perfect layout. It took more time to put a paper together the old way, but that time allowed some space to be creative. Creativity would often emerge from the negative space, the steps in the process. The time spent waiting for the Linotype to print a few more letters. And, of course, from between the letters themselves.

By the time I got to college, the computer revolution was on. Now stat cameras took pictures, and huge type-setting machines cranked out type. Sure, you still had to run the long galleys of type through a wax machine and use your penknife to make layouts, but it was a radical innovation.

Each summer I would work all the jobs at the paper so that people could take their vacations. I’d write the obits for a week. Run the press for a couple. And, of course, sell a few ads.

We’d take the layouts to the local Ludlum’s Grocery store every afternoon, and discuss the price of the meat for the next day’s ads. If you didn’t get enough wax on the back of the 3,9 and 8 you could find yourself advertising a pound of meat for $.89 versus $3.98. Making a very unhappy – and non-paying – customer of Ludlum’s Grocery

The job I liked the best on my summer rotation was running the press. Pushing these huge, 900-pound rolls of paper around, loading them into the presses, and then watching the paper come out, finished.

I started my first company in 1986. I bought a magazine, Rocky Mountain Running News, and used it as the foundation to start a larger magazine, Rocky Mountain Sports. It was a purchase made possible by another radical shift in technology. Instead of paying $35,000 annually for typesetting, I was able to buy a Mac Plus, a 20MB hard drive and a laser writer for $23,000. I also got my hands on a beta version of Quark, which was, at the time, basically a type-setting program for Macs.

So, there I was, a complete amateur, trying to figure out how to typeset my magazine. While I didn’t need a typesetting house for body copy, I’d still use them occasionally for ads.

You should have heard them when they saw those first few issues. They just laughed. Gave me all kinds of grief about how awful the kerning and leading was. How the choice of type was horrible. Every time we talked they’d say, “This desktop publishing thing will never work. You’ll be back.”

Well, we all know how that story ended.

We’re in the midst of another such revolution. And it’s having a direct and profound effect on the advertising business. How it’s created, how it’s consumed. And this revolution is all about connectivity. Now, people can participate in culture, and by association, in the process of creation, advertising or otherwise - by connecting digitally. They don’t have to move to the right city, or work for the right company, to be involved.

It doesn’t matter whether they’re amateurs or professionals. They now have the ability to work where they want, with whom they want and how they want. We’re evolving, as Eric Raymond so aptly put it, into a world ruled by the creative bazaar, and away from the cathedrals of advertising that agencies have created.

You can call it crowdsourcing, co-creation or open source innovation. The point is, the reality is, advertising will continue to be democratized.

With this radical democratization, the structures of advertising organizations are being transformed. Radically. Now one person with a wireless connection can be an agency, a media company, or even a manufacturer with the help of a 3D printer.

The other cultural shift that will only accelerate this change, is that advertising is becoming more tactical. Especially in the mobile world. Platforms like Google will make their money not from interruptive display advertising, but from things like monetizing the call button that comes up when you search for your local pizza shop.

There will be room for agencies. They’re not going away. But they will be, they must be, radically smaller. Cultural curators, tapping into talent from everywhere.

What will advertising be in 2020? It’s anybody’s guess. But in the same way that the linotype machine gave way to the mac, whatever it is will be radically different than it is today.

It’s disasters like the hurricane Sandy that often re-defines the use of media. First, blogs, like Huffington Post, started to replace traditional media but now it seems that citizen journalism produced in social media is replacing digital media.

As the power went out in NYC both HuffingtonPost and Gawker went off line. Over the past couple of years I’ve started to rely on HuffingtonPost as a news source, yet all day I couldn’t get the site to reload on my iPhone. Hence, I went to the source, social media. Following the storm on instagram and twitter without the editorial lens of HuffingtonPost made it a more nuanced and human experience hearing many different sides to the same story.

As the tragedy of Sandy abates, how will the sands of media change? My hunch is they will become more democratic from more empowered citizens. Everyone will be a producer of content. And, I'll be relying more on these newer sources to get closer to the action.

Likewise, the unit of organization in industries, like Journalism, will continue to dissolve, to a unit of one, the citizen journalist.

I continue to be surprised by the lack of ad industry innovation. Maybe it’s because of history, when Mad Men ruled our world and the media landscape was pretty simple, create some nice print with a little TV thrown in. Or, it’s because of the way we’re compensated, not only as individuals but from our clients, as well. The current model is broken and is threatened to go the way of the Dodo bird, like manyother industries before us.

A few weeks ago I got a call from a friend, Frank Striefler, the Chief Strategy Officer at DW+H with an intriguing idea. He asked if we could help rebrand their agency.

It was intriguing to us. Frank and I have talked for years about the idea thatcollaboration is the new competitive advantage. As Frank told me, “We believe an idea can come from anywhere so lets open the agency rebranding exercise not only to all DW+H employees but to the entire world with V&S. We subscribe to the premise of the crowd being smarter than the smartest person in the room.”

I truly believe that creating a world where collaboration gets us further than conventional competitive thinking as a philosophy is the future. In an effort to make our industry abetter place for clients and agencies we must learn to collaborate.

We look forward to collaborating with Lucas Donat, Amir Haque, Frank, the whole DW+H crew and, of course, you.

As industry after industry is ravaged by seemingly unforeseen forces that bankrupt one player after another, I’ve often wondered what stops people from seeing the obvious. It’s simpler than we think. At the end of the day we act according to how we’re incentivized. That’s true with how we charge clients and how we’re personally incentivized to run our agencies.

I was talking with a client yesterday and we agreed that the FTE model of charging is fatally broken. When that’s your model you have two levers to increase revenue, either take more time on a project or put more people against it. Both are counter to the goals of a client. As our client, Peter, said it should be a very simple transaction. Company A needs a campaign idea and pays an Agency B to create it. Ideas = Payment.  Yet, as he said agency after agency wants to be paid money to be a partner, a retainer, that in many cases isn’t result driven. With the transparency of digital advertising tangible, manageable results are seeping into the business and the FTE model of charging clients is revealing it’s cracks.

Naturally, most agencies are currently managed in a way to maximize its profits based on this FTE model. You control your profits by maximizing and billing for every minute spend on a client’s business but also driving down compensation costs by using the most junior people, the cheapest, on the a project.

Again, the incentives are often misaligned with a client’s goals.

More insidious is that such an incentive structure makes those managing agencies focus on maximizing their individual agencies current business and zero time innovating. Such a focus is fine in stable times yet in quickly changing times this management focus leads to where the magazine industry finds itself.

What should we do?

I find inspiration in Eric Schmidt’s focus when he got to Google. The 70/20/10 plan:

We spend 70 percent of our time on core search and ads. We spend 20 percent on adjacent businesses, ones related to the core businesses in some interesting way. Examples of that would be Google News, Google Earth, and Google Local. And then 10 percent of our time should be on things that are truly new.

 Likewise, we in the advertising industry need to adopt a similar plan if we have any chance of not falling into the same trap that the magazine industry has found itself in.

To accomplish that we need to spend 70 percent of our time running our current businesses, 20 percent of our time finding innovative ways to extent our current businesses with new tools such as digital and social and 10 percent of our time on projects and adjacent businesses that are blue sky, ones that have the ability to disrupt the current paradigm or at least radically transform it.

The big question is: Do we have the courage to change and innovate?

The next three years will tell and separate those who are talking the talk, (we’re agency folk are damn good at this), and really doing something about it.

If we change our compensation structures we will and if we don’t I hold out little hope that we can avoid the cultural tsunami that is eminent. 

But, is TV that far behind?

 Reading about HuffingtonPost’s launch of Live, seems to point to an acceleration in the democratization of television. When anyone with a web site and a video camera can set up their own narrowcast channel, viewership and ad dollars in broadcast are going to accelerate their current rate of shrinkage.

For the ad industry, fees can’t be far behind. As fees, have begrudgingly become decoupled from media spend and the cost of producing quality content with new production tools and faster broadband, fees and revenues are going to fall.

However, one thing is consistent across all three industries: the inability to innovate for fear of disrupting the current, very profitable, business model. It’s too late for the magazine industry and the window is closing quickly for broadcast. Can the ad industry do any better?

As I’ve said before, it feels a bit like we’re flying an airplane as we’re building it. A daunting task, no matter your altitude. And trying to change the way an agency works, fundamentally, is alofty goal. But the brave souls here are plugging along, making it happen, day by day. Creating, changing, adapting, evolving. Making V&S the dynamic,exciting place it is. 

And as we’ve grown and changed, so has the responsibility of the team here.

Noah Clark and Chad Walker have been promoted to Co-Executive Creative Directors. They’ll be responsible for managing the crowd, running the creative department, and keeping everythinglively around here on a day-to-day basis.

Noah’s been with us since the beginning. In that time, he’s worked on everything from Harley-Davidson to Western Union to Smartwool. Prior to V&S, Noah was at CP+B, where he worked on Best Buy, Domino’s, VW, and Activision.

Chad joined V&S in Februaryfrom Arnold NY, where he was a CD on several Hershey’s brands, among others. He started his career at Ammirati Puris Lintas, followed by Kirshenbaum Bond & Partners, Ogilvy, MTV, and McGarry Bowen, where he was a CD on the Chase bank account.

Kate McQuail has been promoted from Associate Creative Director to Creative Director. She’s been with us for a little over a year. Before joining V&S, Kate was at CP+B, where she worked on Nike, Old Navy, Domino’s, and AMEX.

And Marco Merced, has been promoted from Junior Creative Director to Associate Creative director. Before Marco started with us here at V&S full-time, he was a go-to member of our crowd, as well as a freelance art director at La Communidad and Martin Agency.

We also have a couple of new additions to brag about. 

Chris Cima has just come on board as a Creative Director from TM Advertising in Dallas. At TM, Chris worked on American Airlines, Captain D’s, and Superpages. 

And Emily Grassmeyer has joined us as an Account Leader from Saatchi & Saatchi in New York, where she worked Toyota and General Mills.