Did Media & Marketing Factor Into The Mortgage Mess?

Yes it did.  I mention this because I have had interesting conversations with Wall Streeters lately about the mortgage mess and the financial meltdown.  I have asserted that media and marketing played an important role in the disaster,  as the promotional engine the financial sector used to entice people to take out loans they couldn’t repay.  My point?  Financial institutions aggressively marketed interest-only loans,  HELOCs, negative amortizing loans and the like.  I bring this up when my Wall Street friends complain that (i) politicians coerced the banks to extend the “dream of home ownership” to people of questionable means and (ii)  consumers themselves were to blame for signing loans that they could never repay.  At the end of the day we are BOTH right.  Banks did aggressively market toxic loans,  but it was to some degree a response to Washington pushing them to provide sub-prime mortgages to millions of under qualified Americans.  And yes …consumers were all too happy to take the money being offered.

The tough thing is this:  many parties WERE guilty in creating the bubble.  We can agree on that.  But Wall Street is back in the black and Main Street is still hurting.  Bonuses on the Street soared in 2009.  Some say they will be high again in 2010.  And yet people living and working on Main Street are another year into the deepest recession in decades.  Ask a small or medium size business owner you know — sales are soft and way off of where they were pre-recession.  Ask someone who has been out of work for a year or more.  I’m sure some of them would love to be able to borrow money from the Fed Funds window at 0% and then buy Treasuries and make an automatic, guaranteed profit.  Like the big banks do.

We can’t blame Wall Street 100% for the mess.  But there are those who find it hard to watch Wall Street making the big money again.  And media and marketing?  It factored in only as a tactic,  a part of the larger dynamic that was played out from 1993-2008.

The New Paradigm

Over the past 5 years we have moved into a new age for media and marketing.  The Internet has surpassed various traditional media in reach and influence.  Media has fragmented.  And the ‘work’ of marketing has gotten more complex,  more comprehensive, more all inclusive.  No longer is traditional marketing and planning sufficient.  (Perhaps it is for some of the Fortune 500.  But all others take note.)  If you expect to market a product or service successfully,  you must leverage the “mosaic” of tools that exist:  web, email, behavioral targeting, social media, street marketing — and traditional media.  This is clear to most good marketers today.  But it is the COMBO of tactics — the mix,  the ‘secret sauce’ — that makes a campaign in this environment successful.

So the posts shared on this blog will aim to take stock, take note and provide analysis on this new paradigm that I call Marketing 2.0.

New brands will emerge.  Existing brands will roll up out new campaigns and products.  Some will do so exclusively via digital means,  some exclusively via traditional marketing.  (Here’s a link to an interesting case study of digital-only marketing success.)  But the most interesting work will take place in the intersection of old and new tactics.  Where the secret sauce separates winners from losers.  Where execution and strategy come together.

EPC Cigar - digital only strategy