May 2012 e-letter

Kerry Knudsen
Kerry Knudsen

May could turn out to be the biggest month ever in the history of marketing. Of special note, Facebook is launching its initial public offering (IPO) of stock, which is expected to raise over $10 billion in revenue and bring the company’s market capitalization to nearly $100 billion – roughly the entire GDP of Qatar.

Coincidentally or not coincidentally, on May 7, Facebook was outed as one of the world’s primary information-sharing media for pornographers. This should shock nobody, since the first industry to try to monopolize the worldwide web in the early ‘90s was pornography, and 30 percent of today’s internet traffic is pornography.

I don’t mean, here, to sound as if I’m down on pornographers. I am, but this is about marketing.

In addition to the porn reports, hardly a week goes by without a news story about teachers monitoring kids, stalkers lurking and “interested parties” investigating unsuspecting users of Facebook. It’s almost as if Gladys Kravitz, the busy-body neighbour in the old television sitcom Bewitched has entered the tech age. Instead of us, through the medium of TV, watching her snoop on the Stephens, she is watching us through the medium of Facebook, and she has evolved from a benign, comic snoop to Chuckie.

Most of Wall Street is rating Facebook’s unreleased stock as “outperform.” I assume that is a good evaluation, given the intense focus the fad-driven marketplace has placed on it. However, other reports say some advertisers have expressed skepticism about the benefits of buying ads on Facebook.

According to Facebook, its first-quarter ad sales jumped 37 percent year-over-year, but slipped 7.5 percent from the fourth quarter due to “seasonal trends” and shifting user growth.

I love phrases like “shifting user growth.” They make you want to say, “Of course…,” so you don’t look foolish, but what does it mean?

For that matter, what does “Facebook” mean? There are and have been others, but Facebook appears the biggest and the survivor. They are called “social media,” and are designed to keep you “in touch.” A noble goal. However, lots of technologies have aimed to keep us in touch. Man differs from animals in his communication skills, and we have developed everything from drums and smoke signals to telephones and Skype to stay in touch. Some work well. Some not so well. Some of you may recall the citizens’ band radio (CB), which became pretty much the exclusive domain of the over-the-road trucking group and became famous for its use in skirting the law and promoting (you guessed it) pornography. “Anytime you go to Michigan, you can roll right over to the Lion’s Den, good buddy.”

have a Facebook account and a Twitter account. I have also had e-accounts since before the worldwide web on CompuServe, Genie, America Online (AOL) and others. I am not against communication. However, I don’t know what to write on Facebook or Twitter. I am speechless. I feel I have signed up for an outhouse wall and a Sharpie, and I have never yet written on an outhouse wall. I do know the output of people that do; you can see it in the washrooms of the CB shops.

To me, Facebook does not produce anything, so it’s more of a fascinating sociological look at fads than an answer to my marketing dreams. I am reminded of the Dot-Com Bubble. The Dot-Com Bubble was a rash of IPOs launched immediately following the launch of the worldwide web in the early ‘90s. Every IPO was (I suppose) launched with a five-year plan for return-on-investment (ROI). In 2,000, when all the plans turned to dust, the bottom fell out of the market, costing more people more money than virtually any event in human history, short of being conquered by Mongols.

To their credit, Mongols had the initiative to get on a horse and ride long distances before they could rape and pillage. Today’s predators only need a fake name and URL.

Naturally, my apologies to any Mongols this stereotype may offend. By way of advice, I have lived my life under the stigma of being Danish. To society, all my ancestors had beards. In addition, the women had metal bras and the men had horny hats. My suggestion is to deal with it. No whining. Mostly they ate fish.

Anyway, Grandma Knudsen used to roughly paraphrase Edmund Burke (quite by accident, I’m sure) in saying those that don’t know history are going to repeat it; “Don’t make the same mistake twice.” That does not add up to a crash for Facebook. However, I won’t be buying any.

On the other hand, this is a good spot to give a sincere thanks to the people that read this occasional e-letter. As I have said many times, I am no economist, not a statistician and am not running for office. I also reject the idea that I need a Ph.D. to share what I know or what I think may be of interest to the industry. You have responded with your e-mails and calls, and have let us know this effort is entertaining, sometimes educational and has become something the industry talks about. As in every other effort by W.I. Media, this proves one thing: it is you, not us, that defines the success of our projects.

With that in mind, you will see in the next issue of Wood Industry that we are once again hosting a special night for Canadians that attend one of our industry’s major shows abroad. This time, we will converge on Atlanta at IWF on Thursday, August 22, for our Second Annual Canada Night. Be sure to see the information on this page, as well as in the May/June issue, for details. As before, free food, free beer and a chance to show the show that we may be invisible, but we are here.


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