“Build a better mousetrap and the world will beat a path to your door.”  That notion inspired generations of tinkerers, innovators and entrepreneurs.

Of course, then some whip-smart MBA got hold of it and it became “build a proprietary supply chain and a captive distribution channel and you can earn superior returns on your cost of capital.”  Scale, rather than inspiration, became the path to competitive advantage.

As digital technology pervades the physical world, the principles of scale are changing in a profound way.  Ordinary people armed with smartphones are becoming hackers, co-creating their experiences with marketers.  Products themselves are becoming services. Supply chains are giving way to demand chains.  Marketing has changed forever.

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A business that doesn’t make money won’t be around for very long.  Profits, after all, are the engine that drives the world of commerce.  Any idiot knows that.

Unfortunately, idiots who do know that go out of business all the time.  The US auto industry, integrated steel giants and many others who failed were extremely profit driven and, in fact, it was their quest for profits that was their undoing.

That’s because making money means nothing without competitive advantage.  Companies who chase opportunities in the name of profitability often find they can’t compete, while others, like Wal-Mart, Southwest Airlines and Nucor are able to be consistently profitable in tough industries with thin margins.  Profits aren’t what always what they seem.

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Innovation is exciting, with lots of big ideas and big personalities.  People like Steve Jobs, Jeff Bezos and the Google guys have become modern olympians and, just like Greek gods, we follow their triumphs and tragedies.

However, although innovation is a big word, it’s also a messy business, full of blind alleys and red herrings.  It’s more of a drunkard’s walk than a linear path; not like in the movies where someone says “aha!” and they’re off to the races.

Innovation, in other words, is hard work only made harder by the fact that you never really know where you’re going until you get there.  When you’re a marketer, it’s even more difficult because there’s so much noise about “shiny objects” that it’s tough to cut through the clutter.  Here’s a framework that will help you.

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“A person should be able to do whatever she wants, as long as she doesn’t hurt anybody else,” is a compelling type of political argument.  It just seems to make intuitive sense.

Or does it?  Ron Paul, a candidate for the US Presidency, espouses just that kind of idea and he has about as much chance as a pet rock of winning.   The fact is, when you start out with a notion like that, you end up with ideas people don’t like.  Why is that?

In the 1970’s, evolutionary psychologists started to figure out why; we survive not as individuals but as communities and that makes all the difference.  Starting from simple principles, they’ve been able to unlock many of the counter-intuitive secrets of how cultures emerge, adapt, spread ideas and produce technology.

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In 1999, just after the Dow broke 10,000, the book Dow 36,000 predicted it would more than triple in just a few years.   That was two crashes ago and nearly 15 years later the Dow is barely 13,000.

Those foolish days would seem long gone, but just last week Forbes published an article which predicted that Apple shares will hit $1,650 by the end of 2015.  Just like Webvan and flipping houses, people are talking about Apple like it can only go up.

Further, Robert Shiller, who predicted the 2000 crash and then the 2008 then real estate crises, was quoted in The Economist saying, “You could play the bubble, because it might not be over yet, but I wouldn’t put money in Apple stock.”  With the rhetoric so eerily similar to previous crashes, it’s time to ask whether Apple is a bubble too.

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“President Obama once said he wants everybody in America to go to college.  What a snob!” exclaimed Rick Santorum.  The reaction among the chattering classes was, as you would expect, visceral in its disgust.

But should it have been?  Is there really something wrong with wanting people who merely seek to work hard, put in an honest day’s work for an honest day’s pay and mind their business to be able to live a decent life?
 
Put another way, what is the true path to prosperity?  There needs to be more serious thinking about the question than we’re getting in political circles.  Is it luck, diligence, perseverance, government investment, private philanthropy, the profit motive or something else?  The answer is more complicated than you’d think.

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Do you have a digital marketing strategy?  Probably not. Chances are, what you have is a collection of tactics that augment massive TV buying.  Those days are quickly coming to an end.  The line between digital and analog is blurring and will soon disappear.

The silos of creative, media and digital are no longer tenable, but the domains of creative account planning, communication strategy and technology have been sequestered in different agency structures, each operating in blissful ignorance of each other.  That can’t go on.

I wrote previously about the difficulties of digital marketing strategy.  Now I’d like to point the way towards some solutions.  The challenges we face herald great opportunities.  From neurobiology to behavioral economics, from the semantic web to HTML5, we have new powerful new tools at our disposal.  Here’s how we can put them to good use.

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LOL cats, Justin Bieber, the first four notes of Beethoven’s Fifth Symphony.  We love our memes.  We repeat them, tweet them and watch them go viral on YouTube.  There’s so much useless chatter about memes, we often forget that they’re profoundly important.

The US constitution is a meme, as is celibacy in priests and the concept suicide bombing.  These might not be as cute, but they are memes nonetheless and they are serious business.
 
Just as genes are the elemental unit of biological fitness, memes are the building blocks of cultural fitness.  Some, like bell-bottom jeans and prohibition, have their day and then die out.  Others, like kosher diet restrictions and democracy last for millennia. People will die for them.  To understand why, we need to start thinking more seriously about memes.

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Just over a year ago, Mary Meeker laid out her vision for SoLoMo, a new paradigm that where social, local and mobile media are at the fore. Meeker has developed a reputation over the years for capturing digital trends and this time was no different.

Since that time, SoLoMo has become more than a buzzword, but the new reality.  We’ve come to expect that our media goes where we go, adapts to our location and allows us to share.

The next frontier, however, will be the creation of immersive experiences at home and in-store.  Rapid advancement in base technologies, heavy investment by major players and serious interest from marketers are combining to transform the way will experience media. That’s the new digital battlefield.  Here’s what’s driving the change.

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We’ve recently seen Facebook go public with a $100 billion valuation and General Motors, formerly the world’s biggest company, go effectively bankrupt and need to be bailed out by the US government.

Meanwhile, the new web darlings, Instagram and Pinterest, have built communities of millions of people in a matter of months, not years and they have done it with a staff that can fit in my living room (which, I might add, is not that big).

What’s amazing is that we have come to take things like these in stride.  Such events have become not exactly the rule, but not the exception either.  In short, we have witnessed the complete transformation of business as we knew it.  The scale economy has become the semantic economy, where value chains have been subsumed by value networks.

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