A standard macro economic stabiliser is through the governments ability to adjust its monetary policy. This is one method the Australian government has been able to use in its attempts to boost the local economy. The general thinking behind it is quit simple: The biggest money sucker for most households is that of mortgage payments. Changes to the monetary policy allows the government, the Reserve Bank rather,  to cut interest rates in order to, among other things, reduce the payment burden for households (assuming the cut is passed on by the banks). Households then have more money, hopefully now they go out and spend more and therefore improve lead to a boost in the economy. Simple really and full credit to the Aussie government being able to have enough elasticity and leeway to be able to use this policy in tough times (take note US!)

Reading the opening paragraph you may be forgiven to believe that I am fully supportive of the rate cuts. I am supportive in a purely objective way but personally it has me frustrated to no end and I’m sure many people have the same sentiment. I was the poor sap who decided to fix the their mortgage when the interest rate was at its highest, concerned about the rate continuing to grow. Now after rate cut followed by more rate cuts the interest rates are the lowest since the 60’s! Since the 60’s!

Well before you all jump for joy remember those misguided and unfortunate souls, like me, who locked in one of the highest rates in history during a time when they are at the lowest in almost half a century. Then jump a little more… I would!

Acceptable. Understandable. Tolerable.

This describes the current sentiment when you witness company after company slashing jobs and restructuring their businesses in order to ensure survival in these turbulent times. After all business is bad and who has the nerve to question any organisation making any harsh moves? Who questions a company when profits and valuations sink to new lows? Not many. It’s to be expected. Times are tough.

So who’s bluffing? Who is playing their hand knowing that no one is going to call them on it? This week saw the announcement of 1850 jobs slashed from Pacific Brands, one of Australia’s iconic companies. These jobs were slashed with the hopes of improving profits by outsourcing manufacturing to Asia. Acceptable. Understandable. Tolerable. What happens when, just after announcing job cuts, the board are also found to have given themselves considerable pay raises?

This really gets the thinking juices flowing. Is the laying off of staff something that they have wanted to do for a while yet it would have been so socially wrong it could have brought their iconic brands into disrepute? Is the timing of such a move really only that, good timing. Picking a time where ditching almost 2000 Australian jobs is actually considered acceptable. Everyone knows at least one person who has been made redundant, so for the 1850 its simply joining the long growing queue which is now not such a big shock. Was this another good reason for Pacific Brands execs to let go as the timing also minimises chances of an internal backlash?

Pacific Brands have certainly been called on their bluff. Now lets see if the public will stop accepting things on face value and learn to question motives as corporations try to sneak under the “GEC” radar.

From December 8, 2008 the Australian Rudd Government put forth a $10.4 billion dollar Economic Security Strategy.

According to www.pm.gov.au the spending was broken down as follows:

• $4.8 billion for an immediate down payment on long term pension reform.
• $3.9 billion in support payments for low and middle income families.
• $1.5 billion investment to help first home buyers purchase a home.
• $187 million to create 56,000 new training places in 2008-09.

The overall chief aim was to strengthen the national economy and support Australian households.

I agree with the latter portion of this statement referring to the supporting of Australian households. Considering that the funding was distributed to groups most needy, notably pensioners, lower and middle income families as well as first home buyers.

However it’s the ’strengthen the national economy’ bit that I largely disagree with. If the Rudd Government had intended on boosting consumer spending by pumping 10.4 billion into this market then I’d like to know the logic behind it. In the aftermath of the distribution many retailers were left stumped as to how little effect this had on sales. Most vocal was that of Gerry Harvey, chairman and founder of the Harvey Norman franchise who claimed that this stimulus did very little to boost sales.

I’m not surprised this stimulus didn’t have the desired effect, albeit only a minimal one. Such a stimulus, directed to the debt riddled population would do very little to get these guys spending to give the economy it’s much needed boost. Instead of the funds being spent on a new TV or a wardrobe upgrade, the cash was undoubtedly used to relieve some debilitating debt, paying off bills, the mortgage or the credit card.

It’s an unfortunate case of catch 22 where the people who need the money are the one’s who will spend it in ways which will not benefit the economy. Yet those that are privileged and deemed not needy by the government, are the exact people who would spend any stimulus back into the economy.

It’s easy to see why this path wasn’t taken… give to the rich? That won’t look good, it might work, but definitely won’t look good!

In light of the current $42b package, another thought that’s circulating through my brain is whether the stimulus packages are a result of the governments ‘knee-jerk-response’, something that has cost the country heavily in the past. The need “to do something” seems the main reason for the actions rather than a planned and structured spending process to achieve maximum effect. After all how can anyone ascertain the best way to spend 42 billion in the space of a month? Kevin Rudd himself stated “The most irresponsible thing to do today, with the worst global economic recession since the 1930s staring us in the face, would be to do nothing,”. Is it possibly a sign to show the Australian people that the government is quick to act and really cares in times of crisis. Im not the only one in doubt, with various publications showing little support for the package. For a brief editorial rundown visit OpenPolitik

I’m sceptical but I sincerly hope the next round of stimulus funding addresses the issues at hand, or at least takes note that cashing up the needy may not be the way to go if economic stimulation is the resounding aim.

I’ve recently been getting into reading a lot by an awesome marketer and thinker by the name of Seth Godin. I recently read this post on Seth’s Blog and it really hit a note with me. First I think this guy is awesome and his views on the ‘purple cow’ relate heavily to my own thinking about what sets marketers apart from their competition, never more relevant than during current economic times.

With the current economic downturn people have lost a lot of money. This gives some online wantrepreneurs (wannabe entrepreneurs) the opportunity to take advantage, offering get rich quick schemes promising fortune and wealth almost immediately by doing hardly any work. The idea is appealing and although an inner part of those who take up the offer knows that this is not going to work, it’s that sense of hope that maybe this is the one. The guy told them so. Its guaranteed. Its only $47.

As we know, for anyone who has decided to use the ‘corkscrew filter system’ or ‘reverse aztec cash funnel’ it simply does not work. It is never sustainable because at the end of the day you are never adding any value or creating something extraordinary. Thinking of creating an information hub about credit card debt and consolidation, then make thousands a day from people clicking your adsense ads? If getting traffic is that easy and cheap then wouldn’t you think the companies advertising would do it themselves?

What I thought I’d do is put together a short list that will help you identify the online scams. When I say scam, I don’t mean that they will take your money and run. It would be much better if they just did that! Instead I’m talking about the ones where you will receive your ‘valued’ item, use up your time getting it running, raise your hopes that your onto something big, then realise a few wasted months later than it simply doesn’t work the way you thought it would. You may like to go through this list the next time you consider taking up one of these fantastic online money making offers.

1. Layout - A lot of these guys will have a very similar layout. It’s usually always a single page that continues for about 30 web page kilometers full of great testimonials, dialogue boxes, large font, big brash heading and bad (usually yellow) text highlighting. For some reason the font will always be roughly the same, usually Verdana or Times. You can spot these horrors from a mile a away.
2. Contact - There is always a fundamental lack of contact details on these get rich quick scheme sites. You probably wouldn’t expect contact information for a blog, especially a personal one however when someone is trying to sell you a money making course, or any other online product, shouldn’t they be contactable other than through a web form? Yes, there are a number of online businesses operated from home and not having these details public is perfectly understandable but these guys simply won’t put details on their site as it results in them being accountable and answerable by phone, remember, out of site out of mind.
3. Tone - Get rich quick schemes can often have a very unique and distinctive tone. The pitch can be seen as arrogant and confronting. Phrases such as ‘why would I care? I’m filthy rich’ pepper such scam sites. The held belief behind this tone is that indifference and arrogance are signs of someone who is successful and does not care whether you purchase from them or not. They don’t need the money, they are rich already. Why would they care if you don’t lose weight, they are in great shape. Its a gimmick and a strategy quite deliberately included by the seller.  The best and most successful companies in the world care and are obsessed with what their customers think, not the other way.
4. Guarantee - A 100% guarantee is usually, if not always, offered. This is to develop a  ‘I have nothing to lose’ mind-frame  for potential buyers. These are genuine guarantee’s and I’m convinced that if you were to ask for your money back they would be more than happy to return it to you. What these guys also know is that only an absolute fraction of the people who buy their product will actually bother to ask for a full refund. This unfortunately is a proven fact which these marketers take full advantage of. They know that if your after a get rich quick scheme and have purchased their product you are most probably someone who wants a quick fix, something for nothing. Asking for a refund takes effort meaning the very people buying the product would be less likely to pursue a refund for it. So don’t think that just because they guarantee success it really means they believe it will work!
5. Spelling and Grammar – Bad grammer is alot. There is no such word as ‘teached’.  Although rare it a sure sign to stay away immediately.
6. Hurt and Rescue – The classic salesmen theory. First they will try to hurt you, tell you how bad life is going to be when your broke and your partner leaves you like when it happened to them. They try to hit you where it hurts. But don’t worry, be part of the scheme and you won’t have to worry about this because you will have so much money… like they do.
7. Quick! – The key theme among the majority of these sites is that they promise a proven method to making money now. If you don’t act now the price of the service will go from $67 back to $297 so you need to be quick. This is exactly what you want, you want to make money now and they claim they will deliver, plus your getting it at an absolute bargain. See that little counter saying you have 23hrs 59minutes and 56 seconds until the price goes back up. Click refresh and see what happens… oops. The promises of quick riches is a deadly trap as it is extremely inviting and the thought of having an extra $20,000 by the end of the month is an opportunity that you just simply can’t ignore. Well ignore it.
8. Visual Examples – Online money making opportunities are filled with visual examples such as proof of income or some guy standing next to an exotic sportscar. These are his earnings and this is the car he drives and it could be yours too! All you need to do is… you get the picture. Just in case you don’t believe that you can make that much money, proof of income (usually Paypal or Clickbank snapshots) are a great way for these guys to get their message across and actually SHOW you how much money they make. I’ll show you how much I am earning as well. Have a look at my latest Clickbank earnings:
   

   Don't believe me? Good.

   And no I didn’t use photoshop. Seriously, this is really how much I make selling plant pruning ebooks online. How could you doubt me?! The scary thing is you can do this to ANY website using ANY numbers without getting a designer to do it and it takes about 30 seconds. Both Clickbank and Paypal are reputable companies but its so easy for these guys to manipulate and use goodwill of these big online brands. I’m not saying they are all fake examples but you need to view these visuals with a grain of salt.

9. Domain Names - www.makemoneynowonlinewithoutworking.com. Most of these domains are long and almost always look rediculous. Many webmasters try to incorporate every single keyword such as ‘money’, ‘online’, ‘rich’ and whatever else they can jam into their domain. Take a quick look and if the name looks a little laboured then i’d probably give it a miss.
10. Too good to be true – The obvious one. As the saying goes, if it sounds too good to be true, it probably is. You have all these bonus items, a free website, free audio tutorials and several bonus packs valued at over $297 and they are offering it to you for $47! And your guaranteed to make money, lose weight, bench more, sleep better, run faster and love longer.. right now! Its sounds great and yes is probably too good to be true.
11. (The +1) The number 7 - My favourite, I love this one. The majority of online scams and get rich quick schemes love to incorporate the number 7 into their marketing and pricing structure. This sounds crazy but I would strongly recommend against buying anything where the price ends in the number 7. Get rich quick schemes seems to have a 7 pattern when referring to pricing. $97, $37, $27 and $47. I think its both a cause of follow the leader (blind leading the blind) and also because they need to add value in their marketing. According to these marketers, nice whole numbers is a sign of a lack of value. Throwing a ‘7′ in the equation makes the price appear more believable and it’s not close to a rounded figure such as a ‘5′ or a ‘0′ at the same time not making the item look too expensive by sticking an 8 or 9 at the end. Companies do it to their pricing all the time but the ‘7-collusion’ effect among online rip off artists is something of a giveaway to the quality of the item they are selling. As silly as this may sound it shows the desperation, lack of knowledge and understanding by these webmasters and wantrepreneurs. Ever heard of $19.95?

There are probably a whole host of other small factors and indicators which I have missed but I believe this is a solid list of the key features that you should be aware of. The truth is that making money and sustainable success is a reward for plenty of hard work, sticking through the tough times and usually a little bit of luck. Overnight success happens to a very select few, who eventually go on to make waste of it.

I believe this is a good thing. I am happy that the majority of success does not come overnight. This allows the natural and organic success path to weed out the posers looking for a quick buck and reward those with drive, determination and passion.

The world is a strange place to be in at the moment. The world of marketing seems to be even stranger yet. It appears rationality has simply gone out the window as people panic in times of economic crisis. You see examples of companies doing the exact opposite of what they should be doing and these are run by extremely intelligent people hiring other extremely gifted individuals to form teams, brainstorm, propose and ultimately decide upon the best approach. Yet there is so much crap out there its unbelievable.

Lets talk marketing. The average person (as well as the very average marketer) may think the best thing to do during times of crisis is to simply cut advertising budget and channel remaining funds into known and tested forms of media. Well lets dissect that thinking just a little.

• Times are tough and business is struggling
• Ok we’ll need to cut budget
• The budget’s have been cut so we need to be careful where we spend our money
• Lets spend it on what we did before (you mean the same stuff that got you in this position in the first place right?)
• That’s a great looking ad! (it goes well with your competitors on page 3,7,9,11,17,22 and 33. Well done.)
• Im not sure how the ad performed but it looked good didn’t it? The others keep doing it so it must be working.

Does it seems a little clearer as to why the cut budget and spend safely simply does not work? You may well need to cut your marketing budget but it doesn’t mean you should stick to your usual, often fundamentally flawed ways. Remember those usual ways are exactly what got you (you being the advertiser, not specifically as in you) stuck in the first place! The only way out is to really set yourself apart from the bunch. Be different, act different and think different. Not being different is the exact reason why people stop buying or trying your offering.

Another major problem here is that everyone is trying to target the masses with the key defining feature that bonds this group is that they are simply indifferent however at the same time represent the majority of the purchasing population. They don’t care whether your ad looks great, or how your new football boot is worn by some bloke they could never be. You need to remember that times are tough for the masses, economic and financial crisis hits the masses hard, the same masses you are targeting.

So now tell me the reasoning behind this marketing approach. You are targeting people who don’t really care and don’t have the money to get out and purchase your product. How much money do you want to waste? How many ads do you need to print and display before you realise it’s just not working?

When things are tough those products that are a cut above the rest, those that are amazing and extraordinary will prevail. Why? Because these don’t interest and are unwanted by the masses. The property market in UK, US, and Australia is struggling but what type of property are we talking about here? We are talking about the property for the masses. We are not talking about water front mansions worth several million dollars. For example take Donald Trump, who in mid 2008 during a time when the housing market was in the pits, sold his Florida home for 100 million dollars! The housing crisis we are really talking about are the typical housing prices going down and bringing a large number of people down with them. The whole economic and financial downturn could possibly be attributed to sub-prime mortgages crashing heavily accompanied with the devalued nature of the properties (all be it a slightly abbreviated explanation!). Who were these sub-prime mortgages sold to? The same people who are not buying your products now, the masses.

I don’t believe I’m extraordinarily bright but you don’t have to be. Just think about it. The old ways of marketing and advertising are useless now because the people your advertising to simply don’t care. They don’t buy FHM to look at your ads and use TV commercial breaks to fill up their drink. TV advertising and Magazine advertising once worked because they were different and the alternatives were few and far between. Traditional media requires the diverting of a user’s attention in order to absorb the message you are trying to portray. This doesn’t work anymore! People are immune to ads and subconsciously and consciously tune-out or flick to the next page whenever they are subject to an advertisement. They have seen hundreds and thousands of these before, possibly even millions over their lifetime so why would they pay attention to yours? Do you read all your spam?

So the sad truth is:

1. People don’t care
2. People don’t have the money
3. People don’t even notice.

Yet I look through a popular men’s magazine and I see hundreds of crappy examples selling the same stuff and marketing to these exact people! Amazing.

How do you get around it? Create. Create something that genuinely ads value and will appeal to a dedicated minority, NOT to the masses. Hang on you say, that is where all the people and the money is! If you have just asked this question then please go back to the beginning of this post and read again. Going straight to the masses just puts you in the ‘me too’ category and you will inevitably fail. Even in times of crises, the minority, namely those who like to try new things (innovators and early adopters) will try new things if they believe it ads value to them. Go for the niches and source the ‘’sounding boards’ and target them directly. They are the ones who will be interested in purchasing and if they like it, they will talk about it, hence why I call them ’sounding boards’.

Being different and adding value is the backbone of forming a sound business model. Watching someone acting different, doing well and then joining the group as a ‘me too’ is the recipe for mediocrity and inevitable failure. A perfect example would be Coca Cola moving into the energy drinks market and taking on Red Bull. Red Bull found a niche, offered something different and with value. It was unique in the market and didn’t even taste good but it added value to those who adopted it who then spread the word and the masses eventually came on board (once again an abbreviated story but you get the picture). In comes Coke, brings in Lift plus and Mother, says me too, makes it taste like garbage juice and says gimme my market share. What happens? It fails and it will continue to fail no matter what they try to do. Why? They tried to target the masses who are indifferent and don’t really care to change. “I’ll stick to Red Bull, thanks anyway” say the masses.

The key is to source out a niche, target the early adopters and offer them excellent value. This is how, now only in current economic conditions but from now on, you will be able to create a solid and profitable business model. Become a ‘me too’ and you will become another ‘me too’ scratching your head, waiting in line for your fortnightly government cheque thinking, what went wrong?

My name is William Bakhos and welcome to my personal blog. Over time I will be posting my thoughts, ideas and opinions in a multitude of fields that interest me.

You’ll probably see written here posts about the topics that most interest me. I was going to list them but it will be made very clear after a few weeks what these topics will be.

Nothing is taboo so feel free to comment what you wish.

That is all I will say for now. See you next post.

William Bakhos

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