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If your product is so damn good Why don't you want to tell more people about it - wouldn't that help them? (and you?) Seriously asking - like I get it if you

If your product is so damn good Why don't you want to tell more people about it - wouldn't that help them? (and you?) Seriously asking - like I get it if you only want to make $x and call it a day but can you help me understand why you wouldn't want to help more people with your superior offer?

derefr 4y ago
There could be per-unit CapEx costs that mean that you actually can't scale up to serve traffic very much faster than organic viral growth allows. Imagine a small cake shop running a Superbowl ad. That'd be dumb, right? Even if they had the money to run the ad, they can't fulfill the number of orders that ad would generate.
- grantsch 4y ago
  What you're saying is just not true. It's also not what capex means. Most companies do not and cannot "go viral" that is a fantasy for most offers. Unfortunately it's just not that easy There's a reason that millions of Americans work in some form of sales. At big, medium, and small companies of all types. It's not an accident or a mistake actually. Any offer worth enough profit to be worth a human pitching it will get pitched - and so too will many offers that aren't worth pitching for that matter
  - derefr 4y ago
    > It's also not what capex means. Per-unit-amortized CapEx costs, sorry. (Typo.) Think: labor acquisition costs when you're providing a high-touch service. You can only hire so fast. Or acquisition/expansion costs for facilities and capital equipment (factory mechanization), in the case of the small bakery. You can only make so many cakes per hour, by hand, in a room of a given size. And it's 100% true. Look at any consultant. Look at any maker of artisanal goods. If you have "inelastic supply", then there is a certain amount of demand that is saturating, at which point you don't need any more demand — you only need better demand. Every customer you acquire from that point on replaces a lower-value customer on your fixed timetable. Untargeted outreach (advertising) does nothing to make that happen. You need targeted outreach (sales) at that point. Or just some very aggressive lead-qualification of your organic inbound traffic.
    - grantsch 4y ago
      I see what you're saying but the analogy isn't very good The reason a local bake shop doesn't do superbowl spots is because they're wasting their spend on millions of people who their offer is irrelevant to. I don't think it's because they can't scale up to fulfill there could be local bakeshops that advertise on local tv or a billboard for example. But bakeshops don't usually make enough profit to justify these efforts to further emphasize this point - there's no rule a company has to fulfill an order on their own. if you can't figure out how to fulfill - many companies will sub that work out/outsource it. the highest touch services - think biglaw partners - those type businesses don't really scale and are more jobs than actual businesses
      - derefr 4y ago
        My hypothetical was that the bakeshop was given an opportunity to run a superbowl ad that it didn't have to pay for. There's still no point in running the ad (vs. paying to run an ad on local TV), because, despite theoretically being able to eventually scale up to becoming a global cake-factory megacorp (think https://en.wikipedia.org/wiki/Continental_Baking_Company https://en.wikipedia.org/wiki/Continental_Baking_Company), there are discontinuous CapEx costs in the way of doing that scaling; and nobody's going to trust this tiny bake-shop enough to loan them the money necessary to do that scaling-up, in advance of fulfilling orders, in order to build up to meet said demand; when they haven't even proven that they know how to scale. > if you can't figure out how to fulfill - many companies will sub that work out/outsource it Yeah, but if they're coming to you, specifically, it's probably not just because you've ran a superbowl ad, but also because you're offering something nobody else does offer, or is set up to offer, or even knows how to offer. If you ran a superbowl ad for your little sandwich shop, that wouldn't make a million people interested in flying out to you to get sandwiches; your sandwiches are probably good, but so are many people's — there's no USP to what you're doing. Sandwiches are fungible-enough that the ad will just make people want a sandwich from their own local place. But, well — you know the "pink sauce" lady? She's got a USP. You can't get pink sauce anywhere but her (for now.) And she's certainly trying to outsource her production to a big condiment corp, due to the massive accidental viral demand she's triggered for her product; but there wasn't anyone already set up to make pink sauce, so she couldn't actually just turn around and immediately buy it on the market, or subcontract its production (AFAIK there's no "condiments mixed to order" job-shop factory; only "we put your label on our pre-made condiments" factories.) Right now, she's just trying to meet millions of orders from all over the US, from her kitchen, and everything's going to hell as a result.
piotrkaminski 4y ago
That's an easy one: your product is good only for some people, who happen to have the problem you're solving. You could tell everyone about it, but you'd reach a lot of people for whom wasting time hearing about your product is a net negative, and it's entirely possible that the overall value to other people's lives of advertising in that way would be negative as well. Of course you could try more targeted advertising to mitigate the negative externalities, but that carries its own costs in terms of invasion of privacy, etc. So yes, it's certainly possible that advertising raises the overall well-being of the recipients, but it's by no means a given.
- grantsch 4y ago
  Who are you to decide that though? If you don't try to reach them - your inferior competitors will. Then you and your potential users are both worse off
  - piotrkaminski 4y ago
    Yes, the tragedy of the commons. The only way to win is not to play. It may not be rational, but I refuse to do something bad just because the alternative is somebody else doing something worse.
    - grantsch 4y ago
      It's ok. To each his own I opt to keep growing

derefr 4y ago

There could be per-unit CapEx costs that mean that you actually can't scale up to serve traffic very much faster than organic viral growth allows. Imagine a small cake shop running a Superbowl ad. That'd be dumb, right? Even if they had the money to run the ad, they can't fulfill the number of orders that ad would generate.

grantsch 4y ago
What you're saying is just not true. It's also not what capex means. Most companies do not and cannot "go viral" that is a fantasy for most offers. Unfortunately it's just not that easy There's a reason that millions of Americans work in some form of sales. At big, medium, and small companies of all types. It's not an accident or a mistake actually. Any offer worth enough profit to be worth a human pitching it will get pitched - and so too will many offers that aren't worth pitching for that matter
- derefr 4y ago
  > It's also not what capex means. Per-unit-amortized CapEx costs, sorry. (Typo.) Think: labor acquisition costs when you're providing a high-touch service. You can only hire so fast. Or acquisition/expansion costs for facilities and capital equipment (factory mechanization), in the case of the small bakery. You can only make so many cakes per hour, by hand, in a room of a given size. And it's 100% true. Look at any consultant. Look at any maker of artisanal goods. If you have "inelastic supply", then there is a certain amount of demand that is saturating, at which point you don't need any more demand — you only need better demand. Every customer you acquire from that point on replaces a lower-value customer on your fixed timetable. Untargeted outreach (advertising) does nothing to make that happen. You need targeted outreach (sales) at that point. Or just some very aggressive lead-qualification of your organic inbound traffic.
  - grantsch 4y ago
    I see what you're saying but the analogy isn't very good The reason a local bake shop doesn't do superbowl spots is because they're wasting their spend on millions of people who their offer is irrelevant to. I don't think it's because they can't scale up to fulfill there could be local bakeshops that advertise on local tv or a billboard for example. But bakeshops don't usually make enough profit to justify these efforts to further emphasize this point - there's no rule a company has to fulfill an order on their own. if you can't figure out how to fulfill - many companies will sub that work out/outsource it. the highest touch services - think biglaw partners - those type businesses don't really scale and are more jobs than actual businesses
    - derefr 4y ago
      My hypothetical was that the bakeshop was given an opportunity to run a superbowl ad that it didn't have to pay for. There's still no point in running the ad (vs. paying to run an ad on local TV), because, despite theoretically being able to eventually scale up to becoming a global cake-factory megacorp (think https://en.wikipedia.org/wiki/Continental_Baking_Company https://en.wikipedia.org/wiki/Continental_Baking_Company), there are discontinuous CapEx costs in the way of doing that scaling; and nobody's going to trust this tiny bake-shop enough to loan them the money necessary to do that scaling-up, in advance of fulfilling orders, in order to build up to meet said demand; when they haven't even proven that they know how to scale. > if you can't figure out how to fulfill - many companies will sub that work out/outsource it Yeah, but if they're coming to you, specifically, it's probably not just because you've ran a superbowl ad, but also because you're offering something nobody else does offer, or is set up to offer, or even knows how to offer. If you ran a superbowl ad for your little sandwich shop, that wouldn't make a million people interested in flying out to you to get sandwiches; your sandwiches are probably good, but so are many people's — there's no USP to what you're doing. Sandwiches are fungible-enough that the ad will just make people want a sandwich from their own local place. But, well — you know the "pink sauce" lady? She's got a USP. You can't get pink sauce anywhere but her (for now.) And she's certainly trying to outsource her production to a big condiment corp, due to the massive accidental viral demand she's triggered for her product; but there wasn't anyone already set up to make pink sauce, so she couldn't actually just turn around and immediately buy it on the market, or subcontract its production (AFAIK there's no "condiments mixed to order" job-shop factory; only "we put your label on our pre-made condiments" factories.) Right now, she's just trying to meet millions of orders from all over the US, from her kitchen, and everything's going to hell as a result.

piotrkaminski 4y ago

That's an easy one: your product is good only for some people, who happen to have the problem you're solving. You could tell everyone about it, but you'd reach a lot of people for whom wasting time hearing about your product is a net negative, and it's entirely possible that the overall value to other people's lives of advertising in that way would be negative as well. Of course you could try more targeted advertising to mitigate the negative externalities, but that carries its own costs in terms of invasion of privacy, etc. So yes, it's certainly possible that advertising raises the overall well-being of the recipients, but it's by no means a given.

grantsch 4y ago
Who are you to decide that though? If you don't try to reach them - your inferior competitors will. Then you and your potential users are both worse off
- piotrkaminski 4y ago
  Yes, the tragedy of the commons. The only way to win is not to play. It may not be rational, but I refuse to do something bad just because the alternative is somebody else doing something worse.
  - grantsch 4y ago
    It's ok. To each his own I opt to keep growing