Naked Business: How Honesty Makes Money – Jason Cohen
Jason Cohen -Founder & CTO, WP Engine
Misleading marketing, hyperbolic sales pitches, the misrepresentation of services and products - we see it all the time in today's business world. Maybe you've experienced the allure, yourself. In a competitive market, cutting corners or exaggerating the truth to get the next deal done can seem more than appealing.
But, does using deception and deceit actually result in more revenue and higher profitability? In this session, Jason Cohen, founder of WP Engine, divulges what he's learned over the past 15 years of building four companies from scratch - that honesty pays. He'll share with us how being honest in business has caused him to be more profitable and he'll teach us how being honest can make us more effective.
Jason Cohen: So as a native Austinite, I’m proud of our weather and our awesome city, but as someone who has to drive in the city every day, don’t move here please. It’s enough for any … This is a jar of fruit. It’s called 100% Fruit. Pretty straightforward, even says Simply also, just to make it clear that it’s 100% fruit. You want to guess how much strawberry is in this jar, what percentage of this jar is strawberries? Five? There’s an optimistic estimate. What else? Guess. 60?
So 30% is strawberries. So 70% of it is fruit syrup from apples and pineapples and lemon juice and red grape juice to make it redder, because that stuff’s not red, and then because that stuff also doesn’t taste like strawberries, they add natural flavors. So nobody’s surprised, right? I mean the first guess was 5%. This is not shocking. What does that mean though? That it says 100% fruit and we all immediately know that’s a lie? That’s weird. And we don’t even think about it. It doesn’t even really bother us that we’re being lied to so obviously, it’s like, “Well, no kidding.” It says, “Spreadable fruit.” That has to mean something, right? That has to mean it’s not real.
But this is an interesting business question. What would happen if you didn’t lie? Like is this useful? Maybe it’s better to lie, it’s better for business, could be. But if you didn’t lie, maybe that would be distinguishing, maybe that would be special if you didn’t, and would that be better business? That’s a good question. He’s some more lies, right? That’s the only thing these things have in common, is they’re not republics. Right? I like Korea’s the best, it’s democratic, it’s for the people, it’s … It’s like the more you say that it is the more it is not that, right?
What’s really funny about these is we know it’s a lie. There’s no doubt that they’re not republics, so what does it mean that you name the country in a way that we know is a lie? It means you’re willing to lie about stuff even when it’s obviously a lie, not just when it’s subtly a lie. That means I’m not going to trust anything else that you say. And again, I wonder if when we lie in marketing materials and in business, if that’s the relationship we establish from the very beginning.
Now, of course we don’t … Our intentions are good, we’re trying to put a good face, like here’s a website. It’s so typical, right? They say stuff like, “The leading provider of internet marketing solutions.” Just look at this site, you can tell they’re the leading provider of internet marketing. So clear. What a great website. The website is copyright 2002. I’m sure nothing about internet marketing’s changed since then, that’s probably fine. Just shows how solid their techniques are, they don’t have to update. It’s not the leading provider, and like, they’re not trying to lie. It’s not like they’re trying to be bad people or deceptive, right? They’re just trying to put on a good face. But it’s such crap that who even cares what the rest of it says?
So what I want to explore today is, is this good business? Like or not? I don’t care if it’s ethical or not, it’s obviously probably more ethical to not lie, but is it good business? I think that’s the question. So let’s start with social media, because everybody says that the secret in social media is to be authentic and honest and tell the truth and be human, transparent. Like these are the words that are used by all the so-called experts about what to do with social media. So I set out to look at data to ask is that what people do on social media, are they honest? You can probably guess the answer.
So here’s a guy, Gary Vaynerchuk, he’s the guy that did the Wine Library TV, so famously just sold wine online and eventually made an empire of $80-100 million a year selling wine in videos with social media, and now he tells other people how to do social media. He says honesty is absolutely the key. Okay, and he’s got lots of followers and crap so he must be good. So what I’m wondering is do the followers of Gary Vaynerchuk who subscribe to this methodology, are they honest? Well, it’s hard to tell, so here’s the data I could get. I asked, do people say good things about Gary Vaynerchuk, or do they sometimes say negative things? Because it should be sort of a mix if we’re being honest and authentic.
So I looked and used a tool that analyzes such things. Of course, it’s not that accurate, but 91% of the things said about Gary online are positive. And then I started looking at what are the negative ones, this will be good. And there was stuff like this, which isn’t really negative, it’s just neutral. And then this guy’s actually self-deprecating, and then this guy’s actually complimenting Gary V for having bigger book sales than Tim Ferriss, because this is the kind of stuff that’s really important obviously. This guy’s talking about butt dialing. They carry on for … In other words, they’re not negative, and so when I went and looked at the things that were marked negative. I found none. I found zero negative things anyone ever said online about Gary Vaynerchuk, which isn’t honest. It’s not all the things people are preaching.
This is a good chart. It reminds of another chart that you may know about. So then I looked at my own Twitter account. I found it 100% positive, which makes me feel good, it’s good for my ego, so maybe we should keep it that way. But it’s not honest. But what’s interesting is the people who are successful at social media, like these folks, are honest. These folks are known for being honest. Gary V himself is known for ripping into other companies, because they’re not doing it right. They did this and it’s so dumb, they should do that. In other words, the people who really are successful on social media are, in fact, honest and say a variety of things that they actually feel. They’re real … I don’t know if they’re their real selves, that’s probably not true, but they’re certainly more honest about what they think, unlike the followers who are not famous. So the methodology of being honest is true, but almost no one is actually strong enough or has enough conviction to do it.
So this notion of 100% positivity, I think that’s maybe a good way to think about websites and brand and how we do all this. We only talk about the good stuff ever. I’m sure there’s nothing on your website that would in any way make someone uncomfortable or be in any way negative. And I wonder if that’s right, because it’s not right for social media. So for example, a lot of businesses have this kind of thing, right? We’re going to show a product comparison chart so that you can make an informed decision, but of course the product in question always has all the check marks, 100% of them, right?
This is an example of a lie by omission, and you know what they say, a lie by omission is twice the lie, right? Because obviously it’s not true that there’s a product that has every single thing that could ever be good, and then all the other ones are simply lacking. That’s not true. The other products have stuff too, you’re just omitting that so that you have 100% accurate. Is that good? Here’s another one where the checks go horizontally, so that’s really creative. I like this one because this is a product that gets rid of lice, and for some reason their checks are red. Red’s bad, isn’t it? But anyway. It has stuff like it’s non-flammable, which is super useful. In case you smoke on your kid’s head I guess, I don’t know what that’s for. And then I like the last one, lice are not resistant to the formula. Like, what? How’s that a feature? It’s not a formula if they’re resistant to it, right? This one’s cool. This one’s so long I couldn’t fit it on one slide. So they have a lot of check marks, that’s good.
So this is just what they all look like. So of course, the interesting question is, is there data about whether this is right or wrong, and there is, so I want to show you that in the form of customer reviews, because when people leave comments about stuff they say all sorts of things, including bad things about bad products. Now obviously if you get good reviews, it’s good. So for example, let’s say you see this shirt which has got a name, it’s called Three Wolf Moon. You can already tell it’s good if it’s got a name. So you might be wondering whether this shirt if horribly ugly or if it’s amazing. So we can look at the reviews on Amazon to determine it is amazing.
Some of the reviews are, “Unfortunately I already had this exact picture tattooed on my chest, but the shirt is useful in cold weather.” Another one was, “My son was born without bones, but when I put this shirt on him he grew bones.” People have interesting ways of complimenting things. So it’s good. So for example, when I was getting started with my company, my latest company, WP Engine. This was a quote from one of our customers. Couldn’t be better, right? They made me more profitable, I have a crush? I mean, never mind I like the company or I advocate for it. A crush? Oh my god, it’s like the best ever.
And so of course, this was on our homepage because when someone else says it you can claim it. If you say it yourself, obviously it’s not that believable. So it’s obvious that reviews are good when they’re good, but then of course there’s the other side and this is why you’re afraid of having reviews of say, your bank because this can happen. What I love about this review is, for this product, this review comes up in Google search ahead of the actual products page. Talk about bad, right? Worst product imaginable. So that’s a good title. The pro was I didn’t hang myself. This is the cons. I would put a pipe bomb in it. He also mentioned in a PS at the end of it that, “I wouldn’t really put a pipe bomb in it, so if you’re the authorities, don’t arrest me, this is not a threat.” Like, he’s self-aware of what he’s saying. Okay, so this is what you don’t want, right? This is why you shouldn’t do it.
So, Canon, the camera company, not some little company, big, obvious, global, consumer product company decided to experiment with consumer reviews just to see, is it really good or bad with business? And they did a proper experiment with all their product line and so on. So this is now some real data to find out, on balance, is this good or bad? So what you’re seeing here is relative, so in other words … Of course before they put up reviews, they didn’t know which of their products would be higher rated and which would be lower rated. So they just knew sales of all of our product lines, wherever they are. So that’s what this represents.
So, of course, after the fact they could then know which products were highly or lowly rated, after they got the ratings. So anyway, there the products are in the beginning. So of the higher rated products, with the better reviews, what happened with the revenue is just what you think would happen, right? It went up, so that’s good. So the question is, okay, so if the lower rated reviews, if the sales go down, on balance is this still better? So here’s what happened to the revenues, the sales from the lower rated products. And that’s weird. Why if you rate it low, would revenue go up, would people buy it more? That’s really counterintuitive.
So they investigated and they found this. This is my story, so this is my daughter about five years ago. I wish she was still this old because that was fun. Now she doesn’t want me to kiss her at school, so I don’t know. Anyway, so this toy she’s playing with, her grandmother bought it for her and it’s got this defect. You see you can stuff toys in it like she’s doing, but then as you lift it up and fly it around, the doors open, they don’t close tightly because of this defect and the toys fall out. So it’s got a problem. But what’s interesting is, grandma found this online and found a review that said, “Yeah, this has this problem where the doors open and the toys fall out.” But grandma looked at it and thought, “Well, it’s cheap, it’s like $20, and it does all this stuff and it makes noise. I know Abbey will like it. So I’ll buy it anyway.”
So in other words, if you know what the problems are, you can evaluate and say, “Well, okay, but at the price that I see, I’ll accept that.” And then when you get it and it gets the defect, you’re not mad about it because you already knew. The honesty about the problems made you comfortable in buying it, and so you did. So that’s what Canon found with their stuff as well. Of course, if you pay $10,000 for a camera versus 100, there are differences like the quality and whether it breaks, and how long the batteries … Who knows? Stuff. Of course there is. Just let me know what it is so I can make an informed decision, even about the bad stuff. That’s why all the products went up in revenue because people were comfortable in making the decision to buy because they had the facts, and they didn’t feel like they were being lied to because other consumers were telling them more or less the truth.
The other thing that happens, that’s revenue. Then you look at profits. And, again, of course, obviously, if you sell more you’re going to have more profits in absolute dollars. But the profits for the lower rated products went up even more than the high rated products, and the reason is because returns went down. And returns went down because people knew what the problems were, so they weren’t surprised and then returned the product. And of course, everyone here probably knows, but returns are death for profits, right? Because Canon’s got a margin of 10%, so they sell $100, they only make 10, right? So when someone returns it, especially if it’s in a bad condition by the time it gets back and they can’t recover, they’ve lost $90, right? Of cost. So since they only make $10 per unit, they’ve got to sell 10 units just to get back to where they were before. So one return just absolutely destroys profitability. So 20% reduction in returns is crazy good for profits, of the bad products. Not bad, but of the lower rated products.
So maybe this is just Canon, maybe there’s something special with their customers or technology or something. So there’s a company in town, a public company called BazarreVoice, and this is their product. They make the software that drives user reviews. So when you go on Walmart, Target, Canon, that’s actually BazarreVoice software driving those reviews behind the scenes. So they have over 500 of the global 200 companies, and they all find this. They’ve done studies with all the names here and probably more by now, and they all find this. Of course, the details differ, but the general principles are always the same. If you’re honest about the good and the bad you sell more and make more profit. That’s across different industries, consumer and business, and globally. Because that’s what all these companies are. So that actually feels somewhat universal as a rule.
So truth in advertising’s good, and so I say this chart is bad. I say you want to put yourself in a good light you shouldn’t just have two check marks I suppose, but I say that the chart should say honestly, here’s the important things that people might care about that we don’t do, and here’s the stuff that we do, and here’s the price, and here’s our brand. You know, the whole package, so that you get happier customers and more revenue. I think this also is relevant to banking because … I mean this is not just interesting because maybe some of the people who are trying to get a loan from you are going through this thought process and that’s useful, but to me in banking, it’s very much a big façade. That’s why we’re all called the iron steel stone bank of forever. Right? Because, ah, yeah, this is safe.
But that’s all we got. Other than that, what the heck differentiates it anyway? Especially in retail banking. There’s an account, of course it’s not paying me any interest, and there might be little fees and stuff slightly differently, but what the hell’s the difference? I don’t know the difference, I can’t tell. And it’s not like anyone cares, it’s not like anyone wants to dig in that deeply to find out the subtle differences. It’s like, well, this branch is near me and it’s not really any different so I’ll use it. But that doesn’t seem very compelling to me. I bet there’s other things that are more interesting. You don’t want to say like, “You know, our vault’s open and no one’s there from 1:00-1:30. Like not that kind of honesty, right?
But banks are intimidating and you’ve got those big ol’ counters, with what now appear to be small humans behind it. It’s very separate and difficult. And I know why that’s true and so there are some things that are necessary and I appreciate that, but I wonder if there’s other ways to think about what it means to be more personable or more human or more interactive. Relationship is a word, but it still feels so business like. I wonder if there’s a way to talk more about how things work. I mean, I bet nobody knows how banks work really. I mean no one outside of banking knows how it works. I wonder if they’d find that interesting.
So, I think what’s on the website does matter. Here’s an about us page from webMethods. I’m not going to read this out loud. I mean, what is this crap? Provides business integration software to integrate. Integration software to integrate, huh? Okay. Thanks. I mean it’s just … This is the usual about us page. I bet on your banking page, if someone tried to find out about us it would be difficult, actually, to find out anything about us in the bank. I bet it’s not really about us.
So here’s a counter-example. Here’s Peldi, there he is. He’s in Italy and he made this company called Balsamiq and this was his about us page. It says, “Hi. I’m one guy.” That’s honest. Right? It also says this down the page, which is especially frightening. He says, “I know, it sounds iffy.” Like, he’s calling his own business iffy. That’s pretty honest. How can a small team do all these things and support a company, well that remains to be seen. I.e., I don’t know, we’re going to find out.
Okay, so this is not what the banking about us page should be, not this exactly, but when he says, “I’m just one guy and I’m just trying to make it work,” on the other hand it also makes me think, “Okay, maybe I should give this a shot, because I want to support one guy, and he seems pretty friendly.” And he says there, he says other things like, “Contagious passion.” And he doesn’t say it right here, but what do you think his tech support is like? Because you know it’s Peldi and you know he really wants to make this work. It’s probably amazing, actually. When he admits the problems, like it’s just me, so you know, he can also say, “But you’re supporting me and I am going to be incredible passionate and responsive in support,” and you’ll believe that because he’s honest about the things that are problematic. And by the way, he made a million dollars in his first year of business. And this curve has continued. So we all wish we had made loans to Peldi, because this is a good bet. So it worked.
And, sure, there’s a ton of companies who look at that and go, “No way, I need a solid company that’s going to be here if I invest in software.” And that’s true, that’s right. Those are bad customers for Peldi, because after all, even if Peldi pretended to be big and got some of those customers, he can’t actually deliver on what those customers want. So ultimately those are going to be unhappy customers that quit, etc. Those are ultimately going to be unsuccessful and therefore unprofitable customers anyway. So by being honest he can get the right customers and the profitable ones, which he did.
So, again, I think there’s this pattern of when you’re proactively honest about the things that are even not so good, it earns you the right to talk about the stuff that is good and that people will now believe you, whereas normally again we all go to websites, we all see the glowing stuff and we really don’t believe any of it. But you can earn believability by being honest about the stuff that’s less good.
So I’ll give you an example of this from WP Engine. So we’re about seven years old now. This is maybe five years old now. We don’t have these kind of problems anymore, but this is a graph of our short-term cancellation rate, which means a customer that comes up and cancels in 30 days. And as you can see, it’s normally around 8% or 6%, somewhere in there. Which is good. A good rate, for an initial engagement. But there’s this massive, crazy spike of cancels, which is obviously bad, and what happened was right here we had an entire hour of downtime. Now, what we do is we host people’s websites. You go to a website, you go to it on the phone, a server has to answer that call. That’s us.
So the absolute worst thing we could ever do is be down, because that’s the whole point is to be up. So we had an hour of downtime and we were hoping no one would notice, and so we said nothing at all. And so of course people noticed, and imagine if you’re a brand new customer and you’re setting up your site and it’s just down with no explanation. Of course, it’s not surprising that some people would just cancel and say, “Okay, I’m out, I’m going to go to a competitor.” I’m surprised only 20% of those people cancel, I guess they didn’t notice.
So anyway, then it goes back down because the new crop of people coming into the site didn’t know that happened, so that’s good. But the real story is here we had 12 hours of downtime. Death, right? And yet, look at the cancellation rate. It didn’t change. If anything it got better, which is odd. But even if that’s a natural variation, it certainly didn’t get worse. And the difference is this time we were honest. This time we were on Twitter right away. “We’re down, it’s actually not our fault,” which was true, it was our infrastructure provider who fortunately was also posting so we could point people at it. “And this is what we’re doing in future to prevent this from happening again.” And so on and so forth.
We’re no longer with this infrastructure provider, for obvious reasons. But the difference between people canceling and people staying was just whether we were honest about a problem. That’s it. And, it counted 100% of the negative effect. All of it. Just by being honest, which is sort of amazing. So, when you tell the truth about what’s wrong, you get to say things like, “Here’s what’s good.” So for example, early on people would say things like, “We have a big website and we don’t want to be your biggest customer.” Which is a really valid thing to say.
Today, it’s easy because we have 65,000 customers and our biggest customers are people that get hundreds of millions of hits a day. So there’s almost no one who can be our biggest customer anymore, and so we’re a very good story now. But that wasn’t true early. So we were able to say things like this, though. “You’re right, we’re just,” let’s just say, “four people and that’s not a lot. And so you’re right, you’re correct to be worried that we can’t handle it. And ultimately if that’s too much of a burden you shouldn’t be here, because this is what it is. But, let me tell you two things. Number one, if we don’t make sites like yours successful, we’re out of business, because this is what our business is supposed to be, running sites like yours. Which means we will do literally anything we have to do to make it work. Because this is our business. If we don’t do this we all have to go back to working at [Sonix 00:24:13], so we got to do it.
“And number two, here is the email address of our current biggest customer, and you can ask them what it’s like to be our biggest customer. How are they treated, how was the technology, and so forth, and find out what that experience is. Here it is. Hopefully they say good things, hopefully in fact are giving a good experience to customers and so that that is true.” And that worked all the time, because we were honest about it. And sometimes people didn’t come with us and that’s good because they would have been disappointed, probably. So it really worked.
So one idea is maybe we should just copy Peldi or somebody like that whose website we like, the about us page, like it worked for him. I’ll just say something like that and then it works. But sadly copying Peldi or us doesn’t work. Here’s why. This is Blake Mycoskie, and Blake founded a company called TOMS, which you may know about. So Blake was in Argentina, in rural, poor areas of Argentina, and he noticed that the children there, a lot of them didn’t have shoes. This matters for two reasons. One is if you don’t have shoes, then it’s easy to get punctures and cuts. And then, you get diseases all the time, because you’re always stepping in water and mud and stuff. Right? Because if you don’t have shoes you don’t have a floor either, probably. So you get sick all the time.
The second thing is if you don’t have shoes, you can’t go long distances. Obviously if you don’t have shoes you also don’t have cars or anything else. So that means you can’t go to school, because it’s not like every town has a school system, you have to travel to go to school. So that means if you don’t have shoes, then you can’t get an education higher than the immediate people around you, and that means you can’t improve your situation. So not having shoes is a really big deal, and that’s what Blake saw.
So he decided to create this company, TOMS, and that’s why the logo of TOMS is the Argentinian flag, and the idea is if you buy a pair of these shoes, TOMS, they give a pair to a kid in Argentina. Now worldwide, but originally Argentina. So here’s Blake giving shoes to kids. Now this is marketing. It’s the best kind, because it’s genuinely awesome. It’s genuinely making a huge difference in the world. It is a good reason to buy TOMS shoes, period. But let’s not kid ourselves, it’s also marketing. It’s brand, it’s also honest.
So, okay, Skechers sees this. Skechers goes, “That’s cool. We can do that.” So Skechers comes out with BOBS. Buy a pair of BOBS, we’ll give a pair of shoes to kids. They even look like TOMS shoes, they’re not even a different style. If you want to talk about copying. And the social media world erupted in anger. So much so that in 24 hours Skechers took down the program. Now, objectively though you’d say, “Well, either way a kid gets a pair of shoes, who cares? I mean, what if everyone always got a pair of shoes when anyone got a pair of shoes? Like, more is better. What’s your problem?”
The problem is that when Skechers did it it wasn’t honest. It wasn’t true. That’s story wasn’t theirs. And when Blake did it it was true. Just whether it’s true made the whole difference in something that is identical in every other way. So the story, your brand and so on, can’t be copied. It has to be true. Even when it’s a great story that deserves to be copied. It has to be true or it doesn’t work. The problem is that Skechers did this. Skechers only copied the retail, the product and the distribution and the concept and the messaging and the marketing. But it was missing the actual realness of it, that’s the problem.
So you don’t copy Peldi but you can be inspired by things, obviously. You can, “Ah, I like the way they said that, or I like the way they positioned that where it was more human but still professional.” It was more human but still imbues confidence in the reader, because as a bank obviously we have to still do that, you can’t be, “Oh, we’re just some people with money in the back.” Like obviously you do have to feel like it’s safe. That’s true. But there’s probably some things you could read or see that inspires you to go, “That’s a way to be more real and interact with people as a human, and also still create that confidence and all those other words that are important.”
And in fact, this is one of the things people often do when they’re developing a brand, is they’ll say, “What are all the things that this brand should be?” And you could list things like to be accessible, approachable, personal. Shouldn’t a bank be approachable? It isn’t. There’s the big wall. And also no one knows how loans work, it’s just, we talk to someone in a suit and then they go in the back and then they say yes or no. Like, nobody knows, it’s not approachable.
But how can we be approachable and trustworthy? Because obviously that has to be true. That’s definitely possible. I think religious leaders have figured that out, right? So I think if you list it out, these are all the things we want, how can we have a language, a brand, website, even have lobbies designed so that these things are true? It’s not easy, I’m not saying it’s trivial, not at all. But isn’t it worth it? Isn’t it worth trying to do that? Isn’t that a good idea? And if you did, wouldn’t that distinguish you, in fact, from other banks, and isn’t that a good idea? So maybe be inspired by some of these things.
Here’s some examples … an example from us. So in 2010, which was the first year we were in business, we were like Peldi. It was just me, and so this was actually a little bit on … I think we had two employees now. We now have 450, by the way. So this was our about us page. “Headquartered in Austin, Texas, WordPress is a technology we use, hence the WP in our name. This is not important, but that’s why it says that. We proudly host .0006% of the 50 million WordPress blogs.” So we’re being accessible, trying to be if not funny then at least easy going. Being humble, I think is fair to say. We’re not trying to claim we’re more than we are. But we’re proud of it. You can be proud and humble. You can take credit for what you are doing, that’s great, but also not think you’re more than you are. That’s one of the things that we always felt was a good idea for our brand, for example.
And then when you host with WP Engine, you’re betting on us personally. See here again, I’m taking advantage of the fact that we’re small. Because when you’re big, even now when we’re 450 which is not that big, but let’s say you have 10,000 employees at a bank. You can’t just say, “You’re going to know all of us. You’re betting on us personally.” No you’re not. You’re betting on the institution obviously.
But there may be people at the branch that is personal. Maybe there should be. Maybe that’s our goal and maybe we don’t do that very often, in fact. Maybe that’s not actualized very often. But one of the advantages of a small business is … Well, a disadvantage if that we only have three people, but an advantage is you can know us and we can know you and we can make that relationship truly, and you can support a small business. So while that’s a disadvantage as well, to be little, we need to take advantage of the things that are advantageous about that and how approachable it is. So that’s what we did and we had pictures of us.
So fast forward to now, we’re 450 people, so maybe you could say mid-sized. But you can still see the core components of our brand there, even though we’re also bigger and we have different things to say, we still want to be accessible and personal, so for example this is our about us page. If you clicked about us, it looks like this. About our company and culture, we really emphasize the culture, which we have well delineated and it’s on this page. This is not clip art, you can kind of tell because our logo’s in the background, but that’s Matthew and Scotty, that’s not clip art, that is us, it’s still us and our faces. It’s still personal.
Of course, we now have great company brand names we can talk about that we host and we’ve won various awards and so on, so of course we can say that, but we can still be a little humble. We can say we power 60,000 companies, that’s cool. We’re proud to be honored. In other words we’re still … Of course we’re going to say, “Look, we won awards.” Like, we should get credit for that, but maybe we’re proud that others honored us as opposed to saying we are the best, we’re the leading provider. We don’t say that. We just say we’re really proud that other people recognized some of the things that we’re doing because we’re really trying. So you can still see that brand in there even though it’s more professional. You’ll get to know these folks by name. This is part of our careers page, come work here. Of course this is not clip art. This is a goofy picture of me, I hate that picture. Anyway.
So putting some of this together, what would it mean for a bank to be more approachable and more human and let me add also to be not just part of the local community but a proponent, an advocate, to help create a local community? The bank is the center of finance for a community in both small business and personal, but I don’t think anyone thinks of the bank as being a centerpiece of the community. But why couldn’t it be? It’s already where the money goes. Why couldn’t it be?
So we have an office in Limerick, and so I was there and I visited the Bank of Ireland in Limerick, Bank of Ireland has revenues of about €3 billion a year, they have 11,000 employees, so it’s a reasonable sized bank. But this, what I just said, is exactly what Bank of Ireland wanted to create. To become part of the community and to be more in the lives of people than just a place where they slip a deposit slip or a withdrawal slip over a two high barrier. So I want to show you a video of what they did. I was there, it is this cool, and so let me show you what is possible.
Nils Tillmann: It kind of combines modern with professionals and with banking and finance, you have little conference rooms, you have working space, you have event space. It’s all for free.
Ragnheiaur J.: I’m here from Iceland with nine of my colleagues, and branch managers, just to see the amazing things you’re doing here today, how far you have come and what we could actually pick up from what you’ve been doing.
Mick Crawford: Our whole family’s used this facility for the last year. I originally came in looking for a place to work. My son then came in to use the coder dojos in the evening.
Eli Crawford: I have learned a lot. It’s crazy.
Ro Molloy: I had an opportunity to show my collection here in the window for four weeks and it was fantastic to have such a beautiful place to exhibit my dresses.
Mick Crawford: The whole family has benefited from the operation. It’s been incredible positive and great fun as well.
Fabrizio M.: I started the company over a year ago and I came straight to this branch, it was just easiest thing. People here are very welcoming. In four month friendly conversation and we just get on with the business and I’ll tell them what the problem we have and what we need to get done and we get very quick response. Just walk in, go to the office, and off we go.
Manoj Chawla: The Bank of Ireland have been really good to us and hosted us with our sort of nonprofit activities, and it really runs like seamless, you couldn’t do it better if you did it yourself.
Tim Artis: I believe that the people at the branch really understood what we needed as a business.
Javier Mey: Bank of Ireland provide us with courses, people management.
Tim Artis: Also the people and the resources that we’re given were absolutely great.
John Mulhall: Well we use this space for our events. We’re very much a learning community group. Bank of Ireland’s been very generous with their offerings of sponsorship by hosting us, and also providing refreshments for our members.
Norma O’Mahony: It’s not just a hot desk space where you come in to work, but it’s actually the community that they’ve created in here. So if you have plans and you share those plans with somebody in here, they’re going to help you to make those plans a reality.
Mick Cooney: It’s got that whole kind of hip tech thing going on, but staff are very, very friendly, and it’s just a great, a comfortable space. It’s one of those things, it’s almost too good, I kind of don’t want too many people to know about it, because then I won’t get a space.
Jason Cohen: Nice, right? My favorite quotes. “My whole family is here.” At a bank? “The kids learning how to code at night at the bank.” “My business is growing.” That’s what we want to hear, that’s what we can do. And then it’s the community they created. This is cool. They didn’t make any new buildings, they just converted their lobby. Of course, they spent a lot of money, it’s really cool and all that, right? But they didn’t need new space, they needed to change how they used the space. Instead of a big lobby with a little bit of coffee with cups this large in the middle, you can do something else. A place where people want to be, to be part of a community.
Now, I know this is the opposite of trivial to create a really cool coworking space, but I just think there’s so much more that maybe any business, but a bank in which it’s probably a pretty good location, it’s probably pretty central, because that’s what we do with retail locations. Lobby is probably pretty much underused in terms of how much value it creates per square foot. I just think there’s a lot more that could be done with that.
So, final point on talking about yourself and putting yourself in the best light but not lying. It’s a tough thing, actually, like when I pick out the photo to use for this conference, I’m obviously going to select one out of a thousand that I think is the best. Is that a lie? Because there’s other really bad ones. It’s not a lie, obviously, as long as they’re all real photos, I just pick one that’s better, it’s not a lie. So just to make this point of what this looks like. OkCupid is an online dating site that also is really into data, which is sort of fun. So they looked at the data of photos that people use and the attributes, characteristics of those photos to ask, what photos for either gender creates the most activity and most dates eventually, for that person. So there’s some data for you.
So for example, for men, the number one thing is with an animal. That’s good. You’ve got to get the dog in there. The second best is showing off muscles, but there’s an asterisk in their report that says, “Only if you have muscles to show.” So that’s good. Don’t like traveling and drinking, so no wandering drunks, not interested. For women, you’d think it would be something like being scantily clad or something obvious like that, but it’s actually not, which is sort of fun. By far, like far, far and away the best thing is what they call the Myspace shot, which is these photos you see where it’s kind of up and slanted. Like, that. That is by far the best thing. Who knows why, it’s kind of crazy.
So I think it’s just easier to take a picture of yourself like this than it is like this I guess, and so that’s not lying, that’s just trying to use data to present well. So I think this is fine. So as long as you know, this is my brand, this is my message, this is what I’m trying to say, then if you A/B test different ways of saying that, that to me doesn’t feel dishonest, that just feels like trying to find the best way to communicate what you’re trying to say. So I think the solution here is to say, “What is the truth that I’m trying to communicate, what’s the brand I’m trying to communicate?” As long as I’m being true to that, I should try every kind of way with pictures and words and advertisement and stuff on the homepage and how my site’s laid out and everything, to try to increase people’s engagement in the root thing that I’m trying to communicate. So I think that’s fine.
So I think it’s universal. I think whether you look at modern marketing, social media, all those companies that BazarreVoice has in retail products, consumer products, business products, nonprofits, social good companies, like TOMS, anywhere, anywhere I think that little companies like Peldi, big companies like Bank of Ireland, or those other big retailers. I think wherever you look, you find this truth that having a brand, knowing what it is, telling the truth, even when it’s difficult, works.
Even Howard Stern, who of course is known for being a shock jock and doing all kinds of horrible things on the radio and also being by far the most successful radio personality ever, when people ask him why were you successful? He already says, “Because we were honest and real.” Even that ridiculous industry and situation, it’s about honesty. And you know that is true because after Howard Stern there were hundreds, maybe thousands, of shock jock type of morning shows that were also all horrible in their own ways, and none of them came anywhere close to Howard Stern because they just copied the ideas, and it wasn’t real. They weren’t actually doing something real. So even something like that, it is everywhere.
So I think it’s just an absolute universal truth, and people say it all the time, people say you should be honest. This is not a weird concept. And yet it is so rare. It’s so rare to find any website that isn’t a pack of lies, or a product on a shelf that’s not pretty much a lie. And business in general, something that’s stretched or an outright lie, it’s just normal still. So I think if you have the gumption to not do that, that you will be special and it will stand out. Almost by definition. I mean even now, me saying all this, almost no one in this room is going to in fact change anything on the website in the next six months. That’s just a fact.
So what happens if you do? I think what happens if you do is it’s better for business and you’ll be differentiated because other people will not have the gumption to do that. So I think if you’re going to have a real purpose besides loans and having retail things for people, if you really want to have a purpose in the community and as a business that serves people, why not create a purpose and then be honest about it and then do it? And then you bank on purpose. So I think honesty wins. Thank you.
Speaker 14: Yeah, sure. Any questions for Jason?
Speaker 15: You talk about telling the truth and being honest and I love your message, I mean it’s great, I try to live that myself. But I find often, and maybe this is more of a comment than question, but I’m happy for you to respond in any way you’d like. Is that … Sometimes it’s difficult to decide what is being honest versus telling … How you communicate what you’re communicating, am I being dishonest or am I just communicating the same story in a different way, so that the cartoon about spin, I mean it’s so easy to fall into that trap of spinning, but how do you manage that and where are those lines and how do you know, when does the bullshit meter go off? Right? I mean I know it’s obvious sometimes when you’re all the way on the other side, but there’s certainly some gray areas, isn’t there?
Jason Cohen: Yeah, of course that’s true. I think ultimately, what is the message you’re trying to communicate? If you’re not crisp on that, then it’s hard to answer the question have you done so? It’s also, whether it’s true or not, whether you’re lying or not lying, are you even being effective in communicating the message? So for number one you have to know what it is you’re trying to communicate, then if you know that, then that is the measure of whether it’s the truth. Does the other person, did they receive the message that you’re trying to communicate? Which is just good communication.
So for example, is a person who comes in for a loan a good risk? Now I know they don’t understand how you figure out risk. If there’s transparency there, does that give them a chance to understand the process and therefore understand even if the answer is no, why, and whether there’s something they could do in the next 6 to 12 months to maybe get to a yes? Well, if your business evolved in the following way, if your revenues got here, if your business plan was shored up in these ways, if you were able to answer these two objection points with something significant, then that could change the answer. If that could be an honest conversation, even in a no, you’re communicating something useful, and maybe even 12 months from now helping someone actually be successful.
So I think you’re right, there’s a gray area, so it’s not math. But I do think you can tell in a … you can feel in a conversation where you know there’s a truth you don’t want to say and so you’re avoiding it. You just know it. Whether it’s an employee that you’re letting go and they ask why, and you give them a reason that’s not the reason. As they say there’s the good reasons and then there’s the real reason. So you give them good reasons but not the real reason, because you’re afraid of telling the truth. All of us have experienced this in some form or another, and you know it in the moment I believe, even though it’s not math.
It doesn’t do any service to the other person. It’s a selfish thing to do, actually. We think we’re protecting the other person by not telling the truth because they wouldn’t want to hear that people just don’t like them, they wouldn’t want to hear that they’re just not skillful enough, that they just couldn’t learn fast enough. That’s a hard message to deliver to that person so I’m doing them a favor by not delivering it and making them feel bad, you think. That’s not true. That’s the good reason. But the real reason is that you don’t want to deliver the hard message. You don’t want to be that person, because it’s hard. But the truth is what’s actually best for someone else is to hear the truth, from someone who … from where it’s coming from a place of actually caring about them and wanting them to do better.
So for example, you just didn’t have a rapport from the other people in the office. To some extent, people just have to like working with each other, because we come to work every day. Sometimes you can quantify what that is and sometimes it’s just rapport and it’s hard to quantify. But you know what? It’s unfair for you to be in an environment where people don’t want to work with you. You deserve to be in a place where people do want to work with you. And different places have different cultures and different styles. So for everyone there’s going to be places where they don’t fit and places where they do. So if you don’t, we’ve got to identify that and just put our finger on it so you can move on and find a place where you do. Everyone deserves that. That’s the good reason, or that’s the real reason and the actually helpful reason.
Even if they don’t have the skills, maybe they shouldn’t have this profession. They need to know that. Now, they may or may not take that advice. That’s then on them, what they do with their career. But don’t you owe it to them to tell them if you feel that this is the wrong career for them? Don’t you owe it to them to tell them that so that they could at least have a chance at digesting that and deciding if they feel … What they want to do with that information, which isn’t your responsibility.
So I bring up these things like letting someone know and so on because it’s in the hardest circumstances that it’s most difficult to be honest. And yet, that’s what everyone deserves, that’s what that person deserves as a human, regardless of what they do with the information, even though it’s difficult for you. So what I would say is, and the broad answer is sure there’s gray areas, but I think we all kind of know when we’re dancing around what we should be saying, often because we’re afraid or we don’t want to do the more difficult thing, and maybe we should step up.
Speaker 16: So this idea of being intentional about honesty is clearly a journey, right? It’s not a switch that we can walk out of this room and throw. So in that journey, on the continuum, is it best to start in the one-on-one communication? Is it best to start with the broad organization of communication? What’s the right pathway for that journey?
Jason Cohen: Yeah. The bigger the company, the harder it is to start changing culture. And there’s the usual phrase, which is, it’s top down, it starts at the top. I actually don’t think that that’s a great way to look at it. I do think it can be killed top down. Because if it’s not valued top down, then it’s not rewarded or changed or etc., and so then it doesn’t live. But it’s not … I don’t think that it’s top down to implement. Because everyone has to be it. Everyone has to do it. And some of the great leaders in culture in a company don’t have any direct reports. They’re the person on the ground, where everyone knows that person, they’re always coming in with the right attitude, everyone always likes working with them, blah blah blah, and they’re not necessarily a manager, but they still affect what the culture is of where they are physically. And then if a manager then praises, recognizes, supports that publicly, now the manager’s magnifying. But that’s actually starting bottom up with support.
So I feel like it can be killed top down and it certainly needs to be supported by management, but my feeling from a company culture perspective, is it comes from all over the place. So I would start by asking who are going to be our beacons, who are naturally going to go, “Hell yes I want to be a part of this transformation. How can I help?” Those people, whatever their titles are, are maybe the place to start and say, “Okay, maybe we have …” Again, this depends on the size of the company, but depending on how many folks there are, maybe it makes sense to have some kind of council. We’re going to get together every week and talk about, together, we’re going to invent how to do this. What’s going to make sense for how we inculcate this? Should we have an event? Should we talk about things? Should we do some training? Should we start by changing some of the marketing material in places that matter less, like not the homepage, but somewhere in the corner? See how we feel about that and then creep forward?
So you can engage the folks in the company who you feel are natural allies and advocates of this to be part of the solution and even part of the ideation of how should we do this together as a company? Now, you know, have 100,000 in a company, maybe that has to look different. But even at WP Engine, for example, with 450 people, we have a permanent culture council, and it rotates. Every six months different people go, they self-nominate, blah blah blah. So that there’s this rotating like we are going to continue figuring out how to implement the culture across the company, and we are going to do it, not top down. Of course, it’s supported by the executive team and so on, but it’s done by people. Of all titles and things.
So I think that kind of engagement is important. Things like changing a website isn’t, of course, democratic. Someone’s controlling that and so then when you get to things like the brand, that’s a big deal to decide I’m going to change the brand. I’m going to decide that being approachable is an important component. What does that mean about everything? Do we change the logo? Probably not, maybe that’s going too far. Right? But maybe in a small institution, though, maybe that is true. What if the logo were two people working together? That would be amazing, for a logo for a bank I think.
Maybe that’s too far, but asking how do we reassess what the brand is and what we really want it to be? Now in this case, is the marketing department and the brand, whoever owns brand, are they capable? I don’t know. Again, some places yes, some places no. This might be a good place to have an outside agency who is good at this and what does that mean? Well, ideally an agency that has helped a bank change their brand. That would be perfect, and then anything, whatever in the target zone is closer to that. A company that’s still in finance, or perhaps a company that’s the same size but also wanted to change in the same way.
In other words, we wanted to go from only professional to professional and approachable, and they helped them through that particular transition. So whatever’s closest in the bull’s eye to exactly you, that they’ve done, and you talk to that client and they have happy things to say, great, maybe that’s a change agent to say we’re going to do this, they’re going to help us to decide as, again, as you said, how do you do this? What does this mean and let’s engage again the wider company for it.
With WP Engine, we updated our … we refreshed our brand last year. Now, four years ago we did the big one of like logo, colors, font, blah blah blah. That was four years ago. But last year we said, “None of that needs to change, we’re perfect on all of that kind of design work. But what we’re saying and what we’re emphasizing and who we want to be isn’t right because four years ago 3% of our customers were enterprise, and now 50% are enterprise. We are an enterprise company and that’s still growing fast, and our branding hasn’t kept up. So we don’t need to change our name or a logo. It’s blue and blue’s fine, but we need to change how we’re talking about the company again. We can’t lie or not be true to our roots, we still have to be approachable, but there’s different things we want to say about things like security or scalability or other things which are true, but more important for the people. Okay.
I’m saying this because we did a brain exercise where we actually engaged almost every person in the 450 people in the company in an exercise. They didn’t decide the brand, but in an exercise. So groups got together and said, “What do we think our brand should be like? We have enterprise, we want to be friendly. What does that even mean? What words should we be thinking about, what images?” So there was all kinds of pictures and you could pick out like, “I think the eagle because this, and I think …” None of this is actually … Eagles aren’t going to go on the homepage, it’s about engaging people to think about who are we, how would we want to talk about who we are?
Each one of these groups were a mix. In other words, all the different departments and things. So all of them were mixed. So everyone had to interact with each other, talk about this problem, do little activities and things. So the result was when we finally said, “Here’s the new messaging.” Which of course the CMO decided, this is not democratic, right? But every single person in the company having had to think through these things knew like, “I know what you’re doing here. I see.” And of course everyone felt like some of my ideas are in there. Right? Not all of them, but everyone felt like I was part of this. So here was a brand refresh that was not democratic and decided by our CMO where everyone was engaged and everyone felt like they were a part of the transformation and therefore they’re behind it.
That’s why I tell that story, and that’s a certain size, different sized companies of course it’s different, but I just want to point out the different ways to approach the answer to your question how do I do it? It can be really creative, and I think that the central thread here is engaging the whole company in the solution. Not top down, not from the corner, not just the marketing department. That’s probably wrong, if you’re going to change your brand or culture. It’s not isolated. Engage. All right, thanks everybody.
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