Transparency

At the Hongqiao Pearl Market in Beijing, vendors thrive on the fact that customers (mostly foreign tourists) by in large are clueless as to the value of the items for sale and how little vendors would actually sell them for.

"She's asking $30 for that Ermenegildo Zegna tie. Could I get it for $20? Or maybe even 10?"

"$80 for Adidas or Puma shoes is a bit steep. I could probably offer half that."

With a little bit of negotiating, though, you start to figure out the exact price at which the vendors won't sell. When I visited this market, I used this information to my advantage, spreading real prices to the members of my group and even other tourists whom I didn't know.

"Most people will give you shoes for $5 or $6."

"Thanks. Don't pay more than $1 for the ties."

Once the shopkeepers found out what we were doing, they were furious. Understandably, the more ignorant they can keep people, the higher their margins. They got angry and said they wouldn't play by our rules. But in the end, they had to cave. I'd just go into a shop and skip the entire bargaining process by saying "I'm here to buy 10 ties for $10 or I'll go somewhere else."

Though some customers are able to find the bare-bones price, I'm sure that these merchants often score big on tourists who don't know how to haggle (or even that all the name brands are fake, for that matter).

Most businesses don't have the luxury of feeding off of ignorance. With the internet, consumer reviews, and word of mouth, you can't expect to pull a fast one and get away with it.

One More Beef With Education

Magician
Bus Driver
Park Ranger
Actor
Photographer
Computer Programmer
Entrepreneur


These are a few of the things that remember wanting to be when I grew up. Except for the first two (which were on my radar when I was about five), I realized that I wanted to be these things through the help of school career counseling between 7th and 12th grade. Every year during that time, a counselor would come into one my classes and I would have to take a questionnaire that asked me things like “Do you prefer working individually or as part of a group?” and “Do you prefer having a set, rigid work schedule or a flexible one?” The questionnaire would narrow down all possible careers and tell me what type of career I should pursue.

Looking back on this experience, I can’t help feeling like this was an epic waste of time. While I can’t fault the system for my changing interests each year, I do question their approach and execution of my “career guidance.” I feel that too much emphasis was placed on the “what” and not enough on the “how.” Unless my memory fails me, we spent very little time discussing the best paths for me to choose to make my dream career possible. To make my career become a reality, I was taught, I should go to college and major in that field. However, the older I get, the more I am coming to the realization that going to college and majoring in what one wants to do is only one of many ways to make a dream career possible. As an 18 year old recent high school graduate, I knew next to nothing about internships, work-study programs, specialized vocational schools or other opportunities that might have been a good fit for me.

So what did I do? I went to the educational equivalent of Wal-Mart. At my “big box” university, I got a quality education for a low-price. Seven and a half semesters later, I left my alma mater with an amazingly bland degree in general business. At the time, of course, I didn’t know that my degree was bland. I had been taught to go to college and major in what I wanted to do, and that’s what I did. Yet, in just the first couple of years since graduation, I have learned the (now obvious) lesson that a very general degree gets you a very general job.

In retrospect, I don’t know what more direction on the “how” could have done for me. After all, what I wanted to be changed radically from year to year and essentially has nothing to do with the path I’m now pursuing. On the other hand, with more “how”, I might have gained skills and learned about opportunities that could have opened me up to something other than a bland big box bachelor’s degree and set me on a more efficient track.

Sand Dollars Less, Real Dollars More

In college, I took a course in personal finance. In the class, I studied useful topics like how to buy and finance a house, how to invest and save for retirement, and how to use credit responsibly. I took the class only because it was required for my major, but it turned out to be one of the most practical classes that I took in college.

In my eight years of high school and college I was required to take the following science classes:

High School - Biology, Chemistry, Physics
College - Biology, Physics, Physical Science

In all, I took nine semesters of science. Now this would be well and good if I wanted to be a scientist, or even a doctor. But I don't. I want to be a businessman. I can understand the need to familiarize students with a broad range of topics, but why does our education system insist on requiring so much science when few people will ever use it in their life or their jobs?

Conversely, I believe that our education system has largely neglected the importance of teaching about money and finance. These topics, I would argue, have a much more practical application for more people than science does. I consider myself lucky that I had even one semester of finance training. But if it had not been part of my major, I would have left college knowing more about mushrooms and mollusks than about money.

I don't mean to say that science is worthless. I could have just as easily described all of the humanites, social science, or English classes that I was required to take. I definitely see the need to teach all subjects for a well-rounded education. My point is that I think that our "general education" is a top-heavy with subjects that many people do not need on a regular basis. As a result, more useful topics like finance are glazed over or omitted.

Though blame for the current financial crisis can be appropriately placed upon greedy bankers and businessmen, I strongly feel that there is some culpability left over for our education system. Over the last 20 or 30 years, if our schools had spent more time teaching students how to spend and save responsibly, we as an American people might not have gotten ourselves into this mess in the first place.

On the other hand, my knowledge earthworms have five hearts is bound to pay off someday.

Taste Testing in Politics

Senate Majority Leader Harry Reid has found himself in some hot water over racial remarks he made during the 2008 presidential election. Amidst the stir, one thing is strikingly absent: the outrage of Jesse Jackson and Al Sharpton. It seems like every time a prominent figure makes a comment with even the slightest hint of racial overtones, those two "civil rights activists" pounce immediately. But not in this case. In my opinion, their noticeable silence after Reid's comments further proves my belief that these two Reverends have something other than equality on their agenda.

I just finished reading an excellent chapter in Predictably Irrational called "The Effect of Expectations". In this chapter, the author recounts the Pepsi Challenge, a study that essentially showed that in a blind taste test, a majority of people preferred Pepsi to Coke. Unfortunately for Pepsi, when consumers know which cola they are drinking, they prefer Coke to Pepsi. In other words, somehow Coke has branded itself in a way such that cola drinkers actually change the way they think about how something tastes, depending on the expectations they hold and experiences they have had.

My guess is that in a "blind taste test" (if you read Reid's quote without telling them who said it) that Jackson and Sharpton would be up in arms. Yet when they know that it came from one of their own (a powerful liberal), there is no controversy.

One Way to Get Free Publicity ...

... is to develop a product you know very few people will ever buy, and then price it so outrageously high that it turns heads.


Here's an example I came across a couple of years ago. This $1,000 Pizza is topped with caviar and lobster tail. The pizza's creator was quoted as saying, "Sure, some people will say it is just a publicity stunt, but I have researched this for over a year and think there is a demand. I have already sold one."

Ridiculous. Tell me, was that guy more concerned with the $1,000 he made from his one sale, or with the hundreds of articles written and 1.3 million Google search results that now come up about his pizza?

Why I Use Gillette

I remember two pieces of mail that came when I turned 18. The first was a letter from the government telling me that I could go to jail if I did not register for the draft. The second was a razor from Gillette. On one of my recent birthdays I received another one from them.

I understand full well that Gillette sending the razor was not an act of sheer benevolence and birthday well-wishery. They obviously make their money with the expensive replacement heads. Nonetheless, I have to shave. So I use Gillette because they did for for me than any of the other guys did. I, like most people, love free. Even when it's just a hook.

Lessons Learned From Qlique

In June 2007, I was recruited to be a "campus president" for Qlique, an up-and-coming social network that sought to compete with the likes of Facebook and MySpace. As campus president, I was in charge of spreading the word about Qlique to all of BYU. I was supposed to recruit as many campus managers as possible. The managers would then get their friends to try using Qlique. For each person at BYU who logged into Qlique one time, I would earn a dollar. Qlique hired campus presidents all over the country in hopes to spark a nationwide movement rooted in America's colleges.

So did it work?

Tell me, have you ever heard of Qlique?

For me, it wasn't too bad. I ended up making about $400 for 20 hours worth of work. But Qlique failed miserably. As I've thought about what caused it to flop, I came up with few reasons.

1. Qlique's design was poor and it was difficult to use. This goes without much saying, if people can't figure out your product, sayonara.

2. Qlique was designed to be the new Facebook, but Facebook wasn't broken. Many examples in business tell us that you don't necessarily have to be the first in the market to be a successful brand. But if you're going to be a late-comer, you better be sure that you are filling a gap that the other guy hasn't covered.

3. Qlique's launch was a disaster. From their horrendous slogan "Where the Pros Crastinate" to the fact that my marketing materials didn't arrive until after the launch, this project was doomed from the get go. Seeing Qlique fizzle the way it did taught me that using a pilot program is essential when considering a nationwide launch. Try it in California first, and see if it takes. Or Ohio. Or Arkansas. It doesn't matter where, just start in one or a few places and then expand as necessary.