Fences and Windows (12 page)

It’s about shaken faith—in science, in industry, in politics, in experts. The markets may be satisfied with their sacrificial lambs, but I think the public may demand more lasting measures.

November 2000

When the top two executives at the New York-based music company BMG Entertainment resigned on the weekend, it revealed a deep schism in the way multinational companies see the Internet’s culture of sharing. Despite all the attempts to turn the Net into a giant shopping mall, the default ethos still seems to be anti-shopping: on the Internet, we may purchase things here and there, but we share ceaselessly—ideas, humour, information and, yes, music files.

So here’s the real debate as it goes down in the boardroom: is this culture of on-line swapping and trading a threat to the heart of the profit motive, or is it an unprecedented profit-making opportunity, a chance to turn sharing itself into an enormously profitable sales tool?

When the five major record labels, under the umbrella of the Recording Industry Association of America, launched a lawsuit against Napster, the music file-sharing site, they threw their lot decidedly into the first camp: file sharing is theft of copyright, pure and simple, and it must be stopped.

But last week, something strange happened: Bertelsmann, owner of BMG Entertainment (one of the five companies behind the RIAA lawsuit), struck a deal with Napster (hence
the BMG resignations). The two companies are going to launch a file-sharing site where music fans pay a membership fee in exchange for access to BMG music. Once it’s off the ground, Bertelsmann will pull out of the lawsuit. At the press conference, Thomas Middelhoff, chairman and chief executive of Bertelsmann, pitted himself against the suits over at Time Warner and Sony who just don’t get the Net. “This is a call for the industry to wake up,” he said.

So what’s going on? Has Bertelsmann, a US$17.6 billion media conglomerate (which owns my Canadian publisher and pretty much everyone else’s), decided to join the cyber-hippies who chant that “information wants to be free”? I somehow doubt it. More likely, Bertelsmann knows what more and more corporations understand: that after many failed attempts to use the Net as a direct sales tool, it may just turn out that the process of trading information is the Net’s ultimate commercial use.

Napster defenders argue that they don’t pirate CDs but rather swap music within an on-line community the way communities of friends swap mix tapes. They get to know and trust one another’s taste and, they argue, they end up buying more music because they are exposed to more of it. They also say they have been driven to create this alternative by inflated CD prices and the hideously homogenous rotation of pop on video stations and commercial radio.

What’s taking place on sites such as Napster is a hightech version of something very old: people talking to other people directly about what they like. It used to be called “word of mouth;” in the Internet age, it’s called
“word of mouse.” It’s the X factor that can create a true phenomenon—such as
The Blair Witch Project—and
that marketers can’t seem to purchase or control—witness the
Blair Witch
sequel.

Or can they? Trying to understand, systematize and harness this most human of all behaviours (how and why we talk to each other) has become something of a corporate obsession. Books such as
The Tipping Point
by Malcolm Gladwell,
The Anatomy of Buzz
by Emanuel Rosen and
Unleashing the Ideavirus
by Seth Godin offer quasi-scientific explanations for how ideas spread: less by advertising than by regular people who are respected by their peers. Gladwell calls them “connectors” and “mavens,” Godin “sneezers” and Rosen “network hubs.”

Based on this theory, a marketing school has developed that encourages companies to treat consumers as if they were journalists or celebrities: Feed them free stuff and watch them do your marketing for you, gratis. Put more bluntly, transform the ultimate anti-commodity—human communication, between friends, inside communities of trust—into a commercial transaction.

This is the irony of the record industry’s crackdown on Napster. At the same time as the legal arms of record companies are pummelling file-sharing sites, their marketing arms are embracing these same on-line communities for their “peer-on-peer” potential. They’ve been paying firms such as ElectricArtists to strategically circulate free music samples and video clips in the hope of turning music fans into battalions of unpaid cyber Avon Ladies.

Bertelsmann itself used these techniques of “on-line seeding” to launch BMG artist Christina Aguilera: Electic-Artists gave away music samples to chatty Britney Spears fans, who then bombarded their on-line friends with the great news: she’s been cloned!

When Bertelsmann made a deal with Napster last week, they were betting on a future in which sharing—when carefully controlled by marketers—is the Internet’s “killer app” : a global network of on-line brand-babble where authentic communities used to be.

The Internet as a giant Tupperware party. Are you ready?

May 2001

When I was seventeen, I worked after school at an Esprit clothing store in Montreal. It was a pleasant job, mostly involving folding cotton garments into little squares so sharp that their corners could take your eye out. But for some reason, corporate headquarters didn’t consider our T-shirt origami to be sufficiently profitable. One day, our calm world was turned upside down by a regional supervisor who swooped in to indoctrinate us in the culture of the Esprit brand—and increase our productivity in the process. “Esprit,” she told us, “is like a good friend.”

I was skeptical, and I let it be known. Skepticism, I quickly learned, is not considered an asset in the low-wage service sector. Two weeks later, the supervisor fired me for being in possession of that most loathed workplace character trait: “bad attitude.” I guess that was one of my first lessons in why large multinational corporations are not “like a good friend,” since good friends, while they may sometimes do horrible and hurtful things, rarely fire you.

So I was interested when, earlier this month, the TBWA/Chiat/Day advertising agency rolled out the new “brand identity” for Shoppers Drug Mart. (Rebranding
launches are, in corporate terms, like being born again.) It turns out that the chain is no longer Everything You Want in a Drugstore—i.e., a place where you can buy things you need; it too is now a “caring friend,” one that takes form as a chain of eight hundred drugstores with a $22 million ad budget burning a hole in its pocket.

Shoppers’ new slogan is Take Care of Yourself, selected, according to campaign creator Pat Pirisi because it echoes “what a caring friend would say.” Get ready for it to be said thousands of times a day by young cashiers as they hand you plastic bags filled with razors, dental floss and diet pills. “We believe this is a position Shoppers can own,” Pirisi says.

Asking clerks to adopt this particular phrase as their mantra seems a bit heartless in this age of casual, insecure, underpaid McLabour. Service-sector workers are so often told to take care of themselves—since no one, least of all their mega-employers, is going to take care of them.

Yet it’s one of the ironies of our branded age that as corporations become more remote by cutting lasting ties with us as their employees, they are increasingly sidling up to us as consumers, whispering sweet nothings in our ear about friendship and community. It’s not just Shoppers: Wal-Mart ads tell stories about clerks who, in a pinch, lend customers their own wedding gowns, and Saturn ads are populated by car dealers who offer counselling when customers lose their jobs. You see, according to a new marketing book,
Values Added
, modern marketers have to “make your brand a cause and your cause a brand.”

Maybe I still have a bad attitude, but this collective
corporate hug feels about as empty today as it did when I was an about-to-be-unemployed sweater folder. Particularly when you stop to consider the cause of all this mass-produced warmth.

Explaining Shoppers’ new brand identity to
The Financial Post
, Pirisi said, “In an age when people are becoming more and more distrustful of corporations—the World Trade Organization protests will attest to that—and at a time when the health care system isn’t what it used to be, we realized we had to send consumers a message about partnership.”

Ever since large corporations such as Nike, Shell and Monsanto began facing increased scrutiny from civil society—mostly for putting short-term profits far ahead of environmental responsibility and job security—an industry has ballooned to help these companies respond. It seems clear, however, that many in the corporate world remain utterly convinced that all they have is a “messaging problem,” one that can be neatly solved by settling on the right, socially minded brand identity.

It turns out that’s the last thing they need. British Petroleum found this out the hard way when it was forced to distance itself from its own outrageous rebranding campaign, Beyond Petroleum. Understandably, many consumers interpreted the new slogan to mean the company was moving away from fossil fuels in response to climate change. Human rights and environmental activists, after seeing no evidence that BP was actually changing its policies, brought up embarrassing details at the company’s annual meeting
about BP’s participation in a controversial new pipeline through sensitive areas of Tibet, as well as its decision to drill in the Alaska National Wildlife Refuge. With the new slogan being parodied on the Net as Beyond Preposterous, BP officials moved to abandon the Beyond Petroleum brand, though they have so far stuck with the new green flower logo.

As evidence of the state of corporate confusion, I frequently find myself asked to give presentations to individual corporations. Fearing that my words will end up in some gooey ad campaign, I always refuse. But I can offer this advice without reservation: nothing will change until corporations realize that they don’t have a communications problem. They have a reality problem.

November 2001

On Saturday night, I found myself at a party honouring Nelson Mandela and raising money for his children’s fund. It was a lovely affair, and only a very rude person would have pointed out that the party was packed with many of the banking and mining executives who had refused to pull their investments out of apartheid-run South Africa for decades.

Similarly, only someone with no sense of timing would have mentioned that as our government was making Mandela an honorary Canadian citizen, it was also trying to ram through an anti-terrorism bill that would have sabotaged the anti-apartheid movement on several fronts had it been in place at the time.

The Canadian anti-apartheid movement raised money for the African National Congress, which would easily have fitted Bill C-36’s sloppy definition of a terrorist organization. Furthermore, anti-apartheid activists deliberately caused “serious disruption” to companies that invested in South Africa, eventually forcing many to pull out. These disruptions would also have been illegal under C-36.

Only someone with absolutely no sense of propriety would have muttered, amid all the self-congratulation, that many in South Africa insist that apartheid still exists and requires a new resistance movement. But two weeks ago, I met Trevor Ngwane, a former ANC municipal council member, who says just that. “Apartheid based on race has been replaced with apartheid based on class.”

Confronted with a country where eight million people are homeless and nearly five million are HIV positive, some try to paint deep inequality as a sad but unavoidable legacy of racial apartheid. Ngwane says it is the direct result of a specific economic “restructuring” program, embraced by the current government and nurtured by the World Bank and the International Monetary Fund.

When Mandela was freed from prison, his vision was of a South Africa that offered economic, as well as democratic, freedom. Basic needs for housing, water and electricity would be met through massive public works programs. But as power came into the ANC’s reach, writes South African professor Patrick Bond in his new book,
Against Global Apartheid
, enormous pressure was put on the party to prove it could govern with “sound macroeconomic policies.” It became clear that if Mandela attempted genuine redistribution of wealth, the international markets would punish South Africa. Many within the party understandably feared that an economic meltdown would be used as an indictment not just of the ANC but of black rule itself.

[Their fears were confirmed more recently. In July 2002, the ANC was set to pass a new law that would diversify
access to South Africa’s enormous mineral wealth, now concentrated in the hands of a few white-owned mining multinationals. The big mining investors rebelled against the plan and threatened to withdraw from the country. Jonathan Oppenheimer, head of public relations for the diamonds giant De Beers, said the law “would put a line through South Africa as an investment destination.”
]

So instead of its policy of “growth through redistribution,” the ANC, particularly under President Thabo Mbeki, adopted the cookie-cutter free-trade program: trying to “grow” the economy by pleasing foreign investors through mass privatizations, layoffs and wage cuts in the public sector, corporate tax cuts and the like.

The results have been devastating. Half a million jobs have been lost since 1993. Wages for the poorest 40 percent have dropped by 21 percent. Poor areas have seen their water costs go up by 55 percent, electricity by as much as 400 percent. Many have resorted to drinking polluted water, leading to a cholera outbreak that infected 100,000 people. In Soweto, twenty thousand homes have their electricity cut off each month. And the investment? They’re still waiting.