Over the past couple of decades, with the arrival of computers, the Internet, and everything else, the world keeps getting faster and faster. The old ways no longer work because they are too slow.
The only way to keep up with the speed of the times is with instinct. This instinct must be developed, tested, and trusted. “How can anyone develop instinct? By definition, instinct cannot be developed.” Nature is very tricky. If you want something badly enough, she will give you the means to have it. When I see people who constantly keep failing at something, I know the reason why is because they do not want it badly enough.
In Nintendo’s history, it is said that Yamauchi just ‘knew’ what games would sell and which ones would not. He had that instinct. Iwata said he ‘is not a genius’ like Yamauchi and must rely on market data. However, if Arakawa, founder of Nintendo of America and Yamauchi’s son-in-law, followed market-data, Super Mario Brothers and Legend of Zelda would never have been released (both performed poorly in focus group tests). Nintendo Power would never have been released. Arakawa took the market research data and threw it away to release the NES anyway. The world is a better place because of that.
Marketers, especially, should be aware that the world is getting faster and faster. Their traditional ‘phased’ marketing plans are beyond obsolete (at this month, we do X. At a month from now, we implement Y feature. Then we implement Z feature later on in order to ‘drive excitement’). All of this lacks spontaneity which is what the Internet driven world revolves around. What happens if an earthquake occurs to mess up this phased marketing plan? “That would be a black swan event, Malstrom,” says the reader. “It cannot be predicted.” And that is the point. There will always be events that cannot be predicted. A long phased marketing plan cannot work in today’s world. You must allow for spontaneity.
This is also why I’ve lately come to find disruption and ‘The Blue Ocean Strategy’ to no longer be useful. The examples in the book were, of course, performed by people who did not have access to these strategies (because the books were not yet written). What they did have was instinct.
This, of course, would make the average marketer very uncomfortable. They are used to conferences, used to text books, used to consultants, and used to everything but instinct. Ultimately, if you have the instinct, you don’t need any of the other junk. Lately, I have found Blue Ocean Strategy and disruption to be counterproductive because they can co-opt one’s instinct. For example, at E3 2010, I thought the 3DS was good. This was due based on following Blue Ocean and disruption. Some emailers wisely said, “Malstrom, I know that the 3DS may follow Blue Ocean and disruption, but this device is not the right way.” Once I threw those books aside and relied more on the instinct, it was clear that the 3DS would be a disaster. It became crystal clear once the price and final product was revealed.
Why do investors want to make sure that Mr. Miyamoto is involved with… like… everything in Nintendo? It is because investors trust Miyamoto’s instincts. It is not so much the man, they trust, as it is his instincts.
The Modern Age is confusing instinct with genius. Today, we would look at the American Indian and remark that his hunting skills are ‘genius’. They are not ‘genius’ so much as ‘instinct’. And how did this instinct get formed? Well, he had to either form the instinct or he would starve. In other matters, someone who is good at computers is declared a ‘genius’ at computers. But it would be better to say he has a good ‘instinct’ at computers. This ‘instinct’ was formed through much trial and desire. The reason why people who are bad at computers are bad is not because they are stupid. They lack the desire to know computers so they never develop an instinct about them. It is not unlike car mechanics. I don’t like working on cars. That lack of desire meant I never formed a good instinct about them. Other people developed very good instincts because they initially had that desire and determination.
I want to give a real example of just how powerful instinct can be over every other alternative. From the NY Times concerning Internet traffic:
By far, most of the traffic from links comes from the sprawling hybrid of Google search and news, which provides about 30 percent of the visits to news sites, according to a report released last week by the Project for Excellence in Journalism, part of the Pew Research Center. And the second? Has to be Facebook, right? Nope. Then Twitter must be the next in line. Except it isn’t.
Give up? It’s The Drudge Report, a 14-year-old site — a relic by Web standards — conceived and operated by Matt Drudge. Using data from the Nielsen Company to examine the top 21 news sites on the Web, the report suggests that Mr. Drudge, once thought of as a hothouse flower of the Lewinsky scandal, is now more powerful in driving news than the half-billion folks on Facebook. (According to the study, Facebook accounted for 3.3 percent of the referrals to news sites, less than half as many as generated by The Drudge Report.)
“When you look at his influence, it cuts across all kind of sites, both traditional news outlets and online-only sites,” said Amy S. Mitchell, the deputy director of the Project for Excellence in Journalism and one of the authors of the study. “He was an early and powerful force in setting the news agenda and has somehow maintained that even as there has been a great deal of change in the way people get their news.”
I cannot think of any area that is faster moving than news on the Internet. Yet, one person has considerable influence in this area. And he has maintained it despite the constant upheavals in Internet news. Conventional wisdom would say one person being able to do this, in this day and age, is impossible. Yet, it is there.
While the New York Times marvels about this phenomenon and begin wondering if the guy is a ‘genius’ (oh, that word!), he, himself, would disagree and chalk it up to instinct. He finds stories he thinks are interesting, makes them more interesting with colorful headlines, adds in vivid pictures to make it even more interesting, and is consistent in doing this constantly. That is it. His instinct is the driver in all this.
So in a news age when the next big thing changes as often as the weather, how can a guy who broke through on the Web before there was broadband still set the agenda? How can that be?
His durability is, first and foremost, a personal achievement, a testament to the fact that he is, as Gabriel Snyder, who has done Web news for Gawker, Newsweek and now The Atlantic, told me, “the best wire editor on the planet. He can look into a huge stream of news, find the hot story and put an irresistible headline on it.”
Instinct. He has no consultants, no ‘marketing data’, none of that. Just instinct.
With no video, no search optimization, no slide shows, and a design that is right out of mid-’90s manual on HTML, The Drudge Report provides 7 percent of the inbound referrals to the top news sites in the country. “It’s a real achievement,” said John F. Harris, the co-founder of Politico. “I covered the Clinton White House in 1997 and 1998 and I would never have conceived that he would be an important player in the landscape 12 years later. He does one thing and he does it particularly well. The power of it comes from the community of people that read it: operatives, bookers, reporters, producers and politicians.”
You don’t need video, slide shows, or all the other bells and whistles. His content is context. Like Google, people like loading up his site precisely because there isn’t tons of video and dynamic html junk. It is a very functional site.
Now that we know that instinct is so much cheaper and more powerful than anything else, how do we develop this instinct? How do these people develop it?
At high school reunions, it is not unusual for people who were at the bottom to now be at the top. The ‘losers’ in school somehow end up doing very well. And the so called ‘achievers’ in school often do not do so hot. What I find is that many of these ‘school losers’, who couldn’t get into an expensive college, ended up with little choices so they turned to business building. The high achiever ‘A’ student then ends up working for the then-loser. The then-loser gets to tell the so-called ‘high achiever’ when he can have lunch, when he can go on vacation, and the harder the ‘high achiever’ works, the more the ‘then-loser’ gets rich. It is an amazing thing to see, and I’ve seen it more times than I can remember. Steve Jobs, Bill Gates, and Michael Dell are all college drop-outs.
In every example I see with the ‘high instinct’ people (as opposed to the so-called ‘high achievers’ who end up working for these ‘high instinct’ people), they always hit rock bottom before they develop their instinct.
With the example of Drudge, he was 341st out of 355 in his high school. Out of high school, he worked at 7-Eleven, McDonald’s, was a telemarketer, was a salesman at a grocery store, and eventually ended up at his highest position in his life: working at a CBS gift store. It was only when his father gave him a Packard Bell computer in 1994 that his life changed.
Today, this is his life. From Wikipedia:
During an April 30, 2004 appearance on C-SPAN, Drudge confirmed that he earns over $1 million. For many years, Drudge was based out of his one-bedroom apartment in Hollywood. Today, Drudge maintains the website from his two properties in Miami — his $1.4 million Mediterranean-style stucco house on Rivo Alto Island, and his $1-million-plus condominium in Miami’s Four Seasons hotel. In updating the site, he reportedly monitors multiple television news channels and a number of websites on several computers in his home office. By early 2009, Drudge earned millions of dollars a year, travelled extensively (Israel, Las Vegas, Geneva), had moved to another property in Miami and become reclusive.
When I read this, I am scratching my head. I wonder, “This guy never went to college. He was at the bottom of his high school. And aside from being wealthy, he, single-handedly, influences the news more than any other person.” It is was all possible to instinct. But he was at the rock bottom when that instinct was formed. This is a recurring pattern I see over and over with people of ‘high instincts’.
Disruption and Blue Ocean occurs from companies that have ‘high instincts’. Disruption, in particular, has comedic example after comedic example of big companies thinking ‘bigger and better’ is the way to go and then failing. But these disruptive companies all were hitting rock bottom and somehow developed the ‘high instincts’ necessary that took them to the top. This has to be why big, fat companies and very secure individuals are very ‘stupid’ as in they lack those ‘high instincts’.
It explains to me why Nintendo, after the disaster of the Gamecube, developed the right instincts to make the Wii, Wii Sports, and Wii Fit. Yet, after meteoric success, they lost those instincts and began making junk. Because of this, the only way we will ever see another Wii is when Nintendo crashes. Since they didn’t institutionalize those instincts, the market will teach them the lesson again.