Quotulatiousness

April 3, 2015

The rise and fall of the Beanie Baby bubble

Filed under: Business, Economics, USA — Tags: , , , , — Nicholas @ 03:00

City Journal‘s Laura Vanderkam looks at the amazing and unlikely fad that swept much of North America until the wheels came off:

In the last few years of the twentieth century, speculative mania gripped seemingly normal Americans. People debated prices in online chat rooms. They devoured literature claiming that sound fundamentals, not froth, led to sky-high valuations. The frenzy grew and then, suddenly, the bubble burst. People lost everything.

This describes the dot-com crash, but it also describes a less-remembered mania for adorable plush toys known as Beanie Babies. In The Great Beanie Baby Bubble, journalist Zac Bissonnette blends the unlikely economics of an asset class encompassing Kiwi the Toucan and Happy the Hippo, and the unhappy tale of Ty Warner, the ruthless tycoon behind them, into a saga far more entertaining than a business book deserves to be.

Like many in the toy industry, it turns out, Warner had an unhappy childhood. His father abused his sister; his mentally ill mother would later steal Warner’s car. Perhaps to compensate, Warner developed an obsessive attachment to stuffed animals. After beginning his career as a salesman, he threw himself into getting the details of the animals he designed for his eponymous toy company right. The eyes in particular had to lock on a buyer. He once borrowed an employee’s pearl necklace to be sure the pearlescent color of a product’s fur was correct. He wanted all his toys to be worthy of bearing his name, “Ty,” on the ubiquitous heart-shaped tags.

From the beginning of his entrepreneurial journey, “his two biggest competitive advantages — obsessive attention to detail and trade-show charisma—outweighed his myriad disadvantages: lack of scale, no advertising budget, a small and not especially competent sales force, a limited product line, and little in the way of a track record with retailers,” Bissonnette writes. Warner would sell only to small stores — a declining market — because he never wanted to see his precious animals end up in a big-box discount bin. Yet the resulting difficulty this created for customers wound up adding to the mystique. People like a hunt. Fortune was kind to Warner for a while, and the limited availability, coupled with strategic “retirements” of desired Beanie Babies, boosted demand. A few collectors started re-selling rare Beanie Babies on eBay. As they made money and told their friends, a mania ensued.

July 5, 2014

The mystic art of going viral – The Putter

Filed under: Britain, Business, Media, Technology — Tags: , — Nicholas @ 13:02

This is Collosal posted a lovely little video a few days ago, showing how one small century-old firm in Sheffield still “puts-together” scissors in the old way:

It’s been a popular video. It’s been a very popular video. In fact, it went viral.

The staff at Ernest Wright and Son Limited have been overwhelmed with interest from people who saw the video and decided they wanted a pair of hand-made scissors. A member of one of my mailing lists says he just got this response from the company about his order (placed before the video went online):

Dear Madam or Sir,

Firstly, may we thank you VERY MUCH for ordering a pair (or more) of our Hand-made in Sheffield England, Ernest Wright and Son Limited scissors.

Secondly, may I please take a moment to explain our current situation.

As you doubtless know, Shaun Bloodworth’s film “The Putter” was uploaded to the internet on Monday 23rdJune. We had been very much looking forward to seeing this film, if purely as an educational exercise documenting the immense skills of the ‘putter-togetherer’.

What we might not have expected was that Shaun’s own amazing skill, coupled with the gorgeous sound work from The Black Dog (wow!), would make such a beautiful and sensory-encompassing experience of something we just see our Cliff and Eric do every day.

And what we REALLY didn’t expect was for this film to go ‘viral’! This was not a ‘commercial launch’ by any means at all; so much as Shaun merely uploading the film for us back here in the factory to see. The power of the internet is truly an incredible and awesome thing.

This has rather caught us at an ‘interesting’ time. We have not been doing particularly well for a number of years as a business and have worryingly dwindled in size. Recently we actually had to make further redundancies and at a few times have thought that the end was truly nigh for Ernest Wright’s altogether. Cheap scissors are ubiquitous; no-one seems (seemed!) particularly interested in how scissors are made any more, and hardly anyone understood paying the price for a good pair – regardless of how we have ever tried to explain it. (Enter Shaun and “The Putter” – and what a benefit, hopefully, to us all!)

There are now just the five of us here in our little business:

Cliff and Eric are our putter-togetherers, although Cliff does the vast majority of the putting whilst Eric is also a skilled hand-grinder and finisher. Eric’s hands are actually those seen working the ‘insider’ machine in The Putter, linishing the inside of the bows (handles) with sparks flying in either direction. These two are both working through retirement years now – purely helping me to keep something we feel is so important, alive.

It would be remiss of me not to mention Ian, who eventually only retired last autumn (2013). All three can be seen here together by the way in a 2012 BBC documentary – http://www.youtube.com/watch?v=IitTC4PqcOI

These chaps have never earned too much – and there honestly hasn’t been too much to earn for a while. But they work hard; so very, very hard. And until around about this Tuesday, they had incredibly little appreciation for their life’s devotion to their craft. I am genuinely so touched that they are finally getting a mention, they so thoroughly deserve it.

We also now have young Jamie and Ryan, who are ‘the young blood’ apprentices and have been with us for around two years now. They began by learning tapping, grinding, then linishing, and are now slowly learning the full art of putting-together themselves – although not at all yet commercially. Practice will one day hopefully make them perfect.

Finally I am the managing director, van driver, salesman, go-fetcher and hopelessly-part-time receptionist. Ernest Wright was my great-grandfather, who formed the company in 1902. I took over when my father almost decided to close the business in 2012, and have since made it my mission in life to save these skills and their type – particularly in Sheffield, the hometown I am so very proud of.

So. Basically after a very long spell of quiet, since around Tuesday morning this week we have been suddenly inundated. With (gratefully) telephone calls, emails, tweets, views, messages, letters and (very gratefully) individual orders. I am honestly struggling to keep up at the moment. The telephone system has crashed and my inbox cannot download fast enough.

Regardless my aim is this: everyone who has ordered a pair of Cliff and Eric’s wonderful-handiwork scissors will receive them; as speedily and safely as is possible.

Ironically Cliff had gone off a well-earned holiday on Monday, and will be sitting in a deck chair in Filey or somewhere for the next week yet – hopefully wondering why on earth he is being asked for an autograph! He knows nothing about his new-found ‘internet popularity’, although he will be completely shy and modest about it as always when he finds out. Only Shaun’s down-to-earth and inconspicuous approach led him to be even filmed in the first place. Regardless I’m sure he will be pleased he can “learn some more” and get cracking with his hammer upon his return.

I cannot honestly promise how long these scissors are going to take to get to you at the moment! we haven’t yet worked out how many of each type are even required. Then they take a little while to be made – but you might know that now! One thing we won’t do, because Cliff and Eric would refuse every time, is to ‘do a rush job’. Your scissors might not always look quite perfect either, but that’s not what we 100% care about. Every pair might have a tiny mark, a scratch, a blemish or even the odd hammer dent, but that is precisely because they are hand, and not machine, made. They are made to be used, not looked at, is our opinion. What we concentrate on more than anything is that they work. Perfectly, every time. I actually reckon you that you can see that in Cliff’s face though, I’ve seen that a thousand times off-camera too.

We are working on strict order-date basis. I am hoping to keep up with at least broadcast emails for the next week until we see how much of a potential flash-in-the-pan this may be. It would be sadly more ironical than anything if this great new interest hurt us rather than helped, so please give me some time to address this situation properly? Meantime we have managed to send out quite a lot of orders already but the previous held-stock is now very low and new orders are still arriving! The lads are certainly preparing to get busy – apart from poor oblivious Cliff in his deckchair at the moment of course.

If orders are going to take more than one month to arrive, I will try to let you know in the next week? I hope that’s ok, it is honestly the very best we can do for now!

If you would prefer a refund, of course I understand completely. Please email me by reply to nick.wright@ernestwright.co.ukwith the title just “REFUND” and at least your order number (usually 4 digits) in the text. I will then get to it as soon as I also can.

Meantime THANK YOU so much, both to old followers and many new friends, for this amazing and wonderful support. This might be our chance for once to shine again. I will try my level best to reciprocate as much as I possibly can.

Yours with kindest regards,

Nick.

Nick Wright
Director
Ernest Wright and Son Limited
www.ernestwright.co.uk

February 18, 2011

The internet in China: hidden powers of persuasion

Filed under: China, Government, Technology — Tags: , , , , — Nicholas @ 08:52

A look at how the internet in China has the power to (sometimes) punish corrupt officials and influence the government:

Corruption and viral marketing has provided the Chinese government with a powerful tool for controlling public opinion. It all began when Chinese companies realized that they could hurt competitors by planting damaging rumors on the Internet. This, even in China, is illegal. But the corruption in China being what it is, there was little risk of getting the police to hunt down and punish the perpetrators. This was partly because the marketing firms, hired by companies to burnish their image, or defame competitors, was careful to have other small outfits get on the Internet to actually do the work, and be careful to not be traceable. So the cops, when forced by companies to do something (often because the owner of the offended firm was well-connected politically), were stymied at first. But the police, declaring it a national security issue, eventually discovered how this was done. But this did not stop all these negative campaigns. To defend themselves, companies that were attacked by these Internet disinformation campaigns, fought back.

This use of negative tactics soon fell out of favor, as all those tarnished companies lost sales. So these Internet based opinion manipulation turned to praising your own products. About this time, the government discovered what was going on, and began to use these marketing companies, and their subcontractors, to change opinions towards government policies. There was a pressing need for this, because all this Internet opinion manipulation had started out, over the last decade, as a popular uprising against government corruption, mistreatment and media manipulation. This “online army” was not organized, except by outrage at government, or individual, wrongdoing. For example, many government officials, and their high-spirited offspring, injure or steal from ordinary citizens, and get away with it. These officials have enough political clout to make the police leave them alone. But once the online army gets onto these stories, everyone in the country knows, and is angry. There are over 400 million Internet users in China, a country of 1,400 million. When a lot of people on the Internet get angry enough, the story, and anger, explodes through the Chinese Internet community. China carefully monitors Chinese Internet use, and tries to block unwelcome information or discussions. But when the outrage on a particular item becomes too large, it’s better to just arrest and punish the guy whose misbehavior got the online army going in the first place.

Who knew that sockpuppeting would be such a valuable online tactic in China? It might not just be limited to China, however:

If the Chinese wanted to use this tool in other countries, they would require posters who are familiar with the language and culture of the target population. That’s difficult skill to acquire, especially for at least a few hundred posters required (to hit, regularly, hundreds of message boards, chat rooms and so on). Done right, you can shift opinions among millions of people in a few days. Done wrong, you fail. And if you’re operating in a foreign country, you might get found out. But the opportunity is there.

July 15, 2009

This genie is well and truly out of the bottle

Filed under: Technology — Tags: , — Nicholas @ 21:03

United Airlines has a public image problem, and they’ve made it worse by their less-than-scintillating performance in response to the Sons of Maxwell video “United Breaks Guitars”:

Besides being genuinely funny, it’s a great example of viral revenge, the flip side of viral marketing. The video accompanies a song by the band Sons of Maxwell that describes how United Air Lines’ baggage handlers carelessly treated band members’ checked instruments. A valuable guitar belonging to band leader Dave Carroll was broken. For over a year, United repeatedly declined his requests for compensation.

That’s when the band turned to social media for revenge, posting its complaint on YouTube. United Breaks Guitars has a catchy tune, clever lyrics and memorable images. The video has gone viral and broken the band out of relative anonymity. After only three days, it had almost 1.5 million views and 10,000 comments, virtually all siding with the band. The story was picked up by CNN, NPR and CBS.

Faced with this social media juggernaut, United dropped the ball. It issued a single tweet stating, “This has struck a chord w/us and we’ve contacted him directly to make it right.” So far, the company hasn’t posted a response on YouTube or its own Web site. Dave Carroll knows how to take full advantage of the power of social media. United doesn’t, and the cost is a PR nightmare.

Viral marketing was one of the innovations that corporations were initially well-positioned to take advantage of: they had the technology, the connections, and the money to push something into the public consciousness, yet leave a question in the public mind. Now that the tools are available to literally everyone with an internet connection, the corporate advantage has vaporized . . . in fact, the advantage is now clearly with the individuals or small groups, who don’t need corporate approval to go ahead with their plans. A corporation, like United Airlines, is unable to move fast enough to keep up with guerilla marketing as conducted by people like the Sons of Maxwell.

Viral revenge is powerful. If your own organization faces a PR nightmare in social media, don’t fall prey to a “Least said, soonest mended” mind-set. Not when profits are down and competition is high. Respond quickly and effectively, or be prepared to face the music. Over 3 million times, and counting.

(Cross-posted to the old blog, http://bolditalic.com/quotulatiousness_archive/005587.html.)

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