Mindshare is more emotion than economics

Jim Bursch gives an interesting analysis of his economic model for mindshare. MyMindshare is Jim’s company, a marketplace for buying and selling attention, or as Jim calls it, mindshare.

I’ve criticized MyMindshare’s premise before because it looks a lot like PayPerPost, which remains, IMO, a shill engine in a world where authenticity matters more than the price you can get for selling out. (This I still believe, despite Jason Calacanis‘s latest transformation on the topic during his interview with Ted Murphy, Founder / CEO of PayPerPost.) Ted argues that blogging is entertainment and we don’t see upfront disclosures in movies when product placement deals have been struck. I find that wanting. Blogs work, IMO, because they tap an authentic voice, in high contrast to the polished productions of major websites and modern radio, TV, and film. That authenticity is what makes the blogosphere work. And when it breaks down, as in the Kathy Sierra case, it gets really ugly. Ted’s entire business model is about hawking that authenticity to the highest bidder.

Unfortunately, MyMindshare is following a similar path. Jim’s latest article dives deep into his economic argument for the rightness of his cause. To his credit, he makes a lot of sense. Why shouldn’t users get a piece of the kickback that normally goes to publishers in the CPA (cost-per-action) marketplace? On its surface, it is a straightforward question that deserves an answer. Jim’s economic breakdown of the supply and demand curves of mindshare is spot on. But the issue isn’t about economics.

It’s about emotions, relationships, and authenticity. Money changes everything in that context.

Advertisers, brand marketers, and salespeople have known for thousands of years that people buy with their emotions, not with their calculators. Sure, microeconomic theory is a decent framework for evaluating the rational influences of pricing on decision making. But its foundation is based on rational behavior in the marketplace. There are so many examples where that assumption proves false that it is amazing the assumption leads to any insights in the first place.

People pay more for Macintosh not because it is more efficient, but because the brand makes them feel good. We subscribe to public radio not because we lose access if we don’t–the radio service is free–but because we feel better about ourselves and our world when we support a cause that we care about. So, let’s start our critique of the economics of mindshare with an observation that even when spending our money, we act irrationally and emotionally.

It gets even more intense when we turn our attention to taking money for our actions. In modern western culture, we value free will and choice, and we judge character based on both. How we live our lives makes a statement about who we are. Because of that, we pride ourselves on making choices based on our innermost truths, on noble, higher ideals. We fight for freedom, stand up against injustices, and dive headlong into romantic pursuits of our noblest calling: love. It matters that we choose our way of our own free will. We cherish more those things we do simply because we want to, compared to those things we do because we are paid.

Think about that.

Getting paid for doing something cheapens it. We value it less.

It cheapens it because when you do it for its own sake, the effort or outcome itself is worth the time and energy. When you take money for it, it means that the effort or outcome wasn’t enough on its own. The first case demands a higher valuation. The latter, a lesser.

The only way getting paid doesn’t cheapen the work is if you are a professional, or aspire to be a professional in that field. Then, you are judged on your merits as a professional. Getting paid to be a ringer on a company softball team is offensive. Getting paid to play professional baseball is an honor.

And that’s where both Ted and Jim miss the mark.

In Ted’s case, he’s either cheapening the act of blogging by robbing it of its authenticity or he is creating a class of professional bloggers, who should be judged by professional standards. There is a potential third way if his bloggers adopt the positioning as professional entertainers, but the PayPerPost system isn’t ramped up to promote entertainer-bloggers.

In Jim’s case, he’s either cheapening the act of surfing by robbing it of its authenticity or he is creating a class of professional link clickers.

What?

Professional link clickers?

It’s crazy. And useless. It adds nothing fundamentally enriching to our economy, especially as those buying the links are looking for authentic shoppers, not professionals looking to make a buck. Now, there is a chance that the economics of certain products actually make it worthwhile for advertisers to advertise directly to that class of people who are professional clickers. Maybe if I have a product geared directly towards those individuals, then it might be profitable for me to target them, but I don’t see this as the market focus for MyMindshare.

The problem with paying folks for clicks or posts is that it robs the action of its emotional authenticity. And that’s what advertisers are paying for. When someone actually cares enough about a topic to post about it without compensation, that means something. When someone actually cares enough to click on a link even when they aren’t being paid to do so, that means something. Both make clear statements about the emotional and intentional disposition of the actor. And it is when we have people in an emotionally favorable disposition that we have the greatest chance of engaging them in a positive exchange. That’s what advertisers want.

Let’s take Jim’s and Ted’s position argument to its logical, yet politically incorrect extension. Instead of dinners, dates, flowers, gifts, and attention, why not pay our love interests directly in cash? After all, time is money. Gifts cost money. At the end of the day, all that $$$ invested in courtship could just be transferred directly to the ultimate recipient, without all those middlemen like restauranteurs, candy makers, florists, and jewelers getting a piece of the action. Let’s disintermediate those middlemen and go straight to the end provider.

Of course, that just isn’t acceptable in our society, because paying for it cheapens it. The only alternative is to be a professional and whether illegal or not, treating your love interest as a prostitute is usually a relationship ending move. It demonstrates a complete moral and emotional bankruptcy. In fact, the topic itself is so distasteful, it was a challenge for me to include it in this post. That same distates resonates with and taints the PayPerPost and MyMindshare business models.

From what I’ve seen, Jim and Ted seem like upright, straightforward guys. They see an opportunity in the marketplace and are busting their butts building a business around those opportunities. I respect that. It takes courage to quit your day job and bet it all on your own startup. They have also both been extremely straightforward, willing to engage the community and make their case. There’s no slight of hand, no intent to decieve, no scam or fraud involved whatsoever. For that, they deserve credit. Their business models, however, leave me with an unsavory taste in my mouth. I don’t know if either business case is “fixable”, but I do wish them both the best in building successful, honorable ventures.

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2 Responses to Mindshare is more emotion than economics

  1. jimbursch says:

    Wow, this is terrific. I can’t disagree with anything you say, but I think you are off the mark in your perception of what MyMindshare is trying to accomplish — what it is trying to be.

    First, I want to differentiate from what Ted is doing (no offence intended, Ted). The huge difference is that MyMindshare is transparent. Everything is above board and it is clear who is buying what, and how much money is changing hands.

    In the sense that to be more transparent is to be more honest, MyMindshare is more honest than any advertising vehicle that currently exists. Wouldn’t it be more honest if a blogger disclosed how much he/she is getting paid when you click on a blog ad? Wouldn’t it be more honest if Google disclosed how much it is getting paid when you click on a Google Ad? Ad-supported media is inherently dishonest, corrupt and corrupting. MyMindshare is not.

    You are right on with the “Professional link clickers” critique. I call it the problem of the mindless click. Mindless clicks are worthless, and the extent to which it occurs at MyMindshare will detract from its value.

    I am constantly working to address that problem and I have created mechanisms to minimize mindless clicking and ferret it out of MyMindshare.

    First, users of MyMindshare are registered. Activity at MyMindshare is necessarily logged, and mindless clicking creates a pattern that is readily indentifiable in the logs.

    But the thing I am most excited about is enabling the MyMindshare community of users to police themselves. An honest user has a vested interest in ensuring that the value of mindshare is not cheapened by mindless clicks. To that end, I am attaching community forums to MyMindshare interests. New members will be able to go to these forums and engage other users with common interests. Established members will be able to vet new members and deter dishonest actors.

    I’ve just started setting this up — so stay tuned.

    Finally, I want to address the emotional component that you so elloquently describe.

    MyMindshare is a starting point for consumers and advertisers. In that sense, it is like a dating service. It is where introductions are made, and we try to make this introduction in a way that fosters the start of a good, healthy and rewarding relationship. Of course not every introduction is going to lead to marriage. But by starting on an honest footing, more good matches will be made and all parties will be more satisfied with the process.

  2. jimbursch says:

    Expanding on my dating service analogy, and applying your “Mindshare is more emotion than economics”…

    It’s as if you were at a party and met a beautiful women and went on a date, only to discover that she is a prostitute. It my be emotional to you, but it certainly isn’t to her.

    At least at a brothel there is no confusion about motives.

    MyMindshare is like a brothel, in the most positive sense.

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