Volume 94: Ponzi Capitalism.

1. Ponzi Capitalism.

tl;dr: Crypto smells funny.

The most bang-on tweet following the Super Bowl wasn’t marketing Twitter losing its mind over why a QR Code screensaver was brilliant, or info-sec Twitter losing its mind over that same QR code for security reasons, but that of a wag noting that all the crypto ads reminded him of the egomania of the dot com bubble of 2000 just before it burst.

However, unlike those heady days, one can’t help but feel the Crypto narrative today is more FOMO and less “future is here.”

(As an aside, have you noticed the hypocrisy of tech-driven societal narratives, where the same people who told us ten years ago that nobody wants to own anything are now telling us everyone wants to own pixels? Just in case you didn’t know by now, you should deeply question any societal narrative pushed by anyone peddling a technology that just so happens to fit that narrative).

Anyway, it’s becoming increasingly clear just how much fraudulent behavior the crypto landscape attracts. Just take a look at recent revelations that 80+% of available NFTs infringe someone else’s copyright or are just plain old spam. Or the pumping behavior, where people sell NFTs to themselves for apparently huge sums of money just to set a baseline price for reselling that’s far above what the NFT might actually be worth. A marketing stunt to pump the value of something that’s essentially worthless, and if you’re wondering, yes, it is illegal. (Which someone might want to mention to Justin Bieber, just saying).

However, what’s most concerning is the observation that, in general, crypto bears more than a passing resemblance to a Ponzi Scheme. No matter what the true believers tell us, if it looks like a duck, quacks like a duck, and waddles like a duck, it’s probably a duck. Like Tether, which is most definitely duck-like.

Ponzi Schemes are illegal because they aren’t delivering an actual return. Instead, they create the illusion of a return by artificially shifting capital from newer investors to those who were in early. This shifting of capital means the scheme can sustain itself for a while by offering too good to be true investment returns, which attracts newer investors until it all collapses when the promised returns exceed what is fundable by new money.

This is why, if crypto is a Ponzi Scheme, the Super Bowl is the perfect place to advertise it. Right now, roughly 16% of Americans have invested in crypto in some way or another. To keep up the ‘bezzle, this number needs to grow significantly. And to grow, more people need to know about and trust what they’re investing in. And how do we signal that this is a legitimate investment opportunity? That’s right, we advertise it on the Super Bowl.

So, what next? Well, let’s hope I’m wrong, and it isn’t a Ponzi Scheme at all, but just in case I’m not, the fallout will likely be grimmest for those least able to withstand the losses. You see, of that 16% of people who’ve invested in crypto, a higher proportion are young people of color, which statistically speaking, means the people with the most to lose might be sitting on a potentially outsized exposure to crypto risk.

Ideally, we wouldn’t be in this position because this whole arena would’ve fallen under some meaningful regulation by now. But, in these times of unprecedented political dysfunction and fast-moving technological innovation, that was never likely.

Anyway, I hope you enjoyed tweeting about that QR code bouncing around the screen and that if you’re heavily invested in crypto-assets that you’re careful about it and haven’t refinanced your home to buy DogeCoin.

2. Economists say marketers good at marketing.

tl;dr: Generating £3.80 for every £1 spent if we’re being precise.

One of the oldest jokes is that if you asked 20 economists the answer to a yes/no question, you’d get 20 different answers. So, when economists start agreeing with each other, it might be worth paying attention.

This is why it’s worth reading this article by economist and studier of all things marketing, Grace Kite. In it, she points out that whatever crisis of marketing effectiveness may have existed is now well and truly over, with all evidence suggesting that our shift to digital channels has matured to a point where effectiveness is no longer in question.

The reason is that, unlike ten years ago, we now have considerable experience in the digital realm and so better understand what works and what doesn’t, and how best to allocate our ad dollars.

And while I’m more than well aware that marketing is more than just advertising, I’m prepared to take positive reinforcement wherever I can get it.

So, next time you’re tempted into one of the silly negative narratives, like advertising is dead, marketing is irrelevant, all you need is a great product, or even de-branding (ugh, the nonsense), please read Grace instead.

3. Turns out we quite like cats and dogs.

tl;dr: Very few being handed back, which is nice.

One of the more heartwarming realities during the pandemic is that people have been rescuing cats and dogs in record numbers. Speaking to a friend just the other day, they mentioned the shelters in New York have been practically empty (which never happens), with people competing for the cutest rescues like they’re rent-controlled apartments (So very New York).

I can certainly count my family among the pandemic rescuers, having added another mutt to our brood. And, while he’s incredibly annoying, he isn’t going back anytime soon, even though he peed on our bed (disgusting, expensive) and howls like a Wookie every time he gets into a car (earplugs, doggie downers).

And that’s the thing everyone was worried about. Not that a dog might pee on an owner’s bed or howl like a banshee at the sight of a gas station, but that they’d pee on the bed and howl at the gas station and then be handed straight back to the shelter in a kind of “thanks, but no thanks” kind of way.

Anyway, it turns out that 90% of all the pets adopted during the pandemic have stayed adopted.

Good.