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“There are three creativities: creativity in technology, in product planning, and in marketing. To have any one of these without the others is self-defeating in business.”
— Akio Morita
The TR-55 transistor radio, the first product sold under the Sony brand, was a technical success — released in 1955, it marked a leap in miniaturization, solid-state design and made-in-Japan innovation.
It wasn’t much of a seller, however, and Sony’s co-founder, Akio Morita, knew why. It needed a better marketing pitch.
So for its next product, Morita demanded that Sony’s engineers develop a gadget that he was sure would get people’s attention: a “pocketable” transistor radio.
By 1957, Sony had developed the world’s smallest radio, the TR-63 — a miracle of miniaturized components and clever engineering.
But it was a little too big to fit in a shirt pocket, which was Morita’s goal: “We liked the idea of a salesman being able to demonstrate how simple it would be to drop it into a shirt pocket,” he explained in his autobiography, Made in Japan.
Instead of sending the engineers back to the drawing board, however, Morita solved his design problem with a marketing trick: “We had some shirts made for our salesmen with slightly larger than normal pockets, just big enough to slip the radio into.”
It worked better than even Morita could have imagined.
Not only did the TR-63 become an international hit that made Sony synonymous with innovation and high-quality products — it also kickstarted a revolution in global consumer electronics that would change the world’s perception of Japan.
Morita would go on to become — in the assessment of John Nathan, author of Sony: A Private Life — “probably the greatest marketer of the 20th century, right up there with Steve Jobs.”
If that sounds like hyperbole, consider that Sony — a Japanese company — was rated the number one brand in America from 1999 to 2006.
It was such a significant accomplishment that when Morita died in 1999 at the age of 78, he was hailed as “the engine that pulled the Japanese economy.”
He wasn’t born a marketer, however — he started out as a kid who liked to tinker with electronics. He went on to become a physicist working for the Navy, and then co-founded Sony as an engineer.
Neither he nor his co-founder Masaru Ibuka had any notion of “merchandising or salesmanship” when they started Sony.
“It never occurred to Ibuka or me that there was any need for this,” Morita explained in his autobiography. “Ibuka believed strongly that all we had to do was make good products and the orders would come. So did I. We both had a lesson to learn.”
Both founders assumed that “in making a unique product, we would surely make a fortune.”
But when they made their first unique product — a ground-breaking, magnetic-tape recording device — they didn’t even make their investment back: “Everybody liked it, but nobody wanted to buy it.”
That’s when Morita learned the value of marketing: “Having unique technology and being able to make unique products are not enough to keep a business going,” he realized. “You have to sell the products” too.
He also realized he’d have to do the selling himself: “I was struck with the realization that I was going to have to be the merchandiser of our small company.”
This may be a universal truth of business: Every product, no matter how good, needs to be sold.
Blockchains, included.
Aim high
In his latest blog post, Simplifying the L1, Vitalik explains what Ethereum is aiming for — “to be the world ledger: the platform that stores civilization’s assets and records, the base layer for finance, governance, high-value data authentication, and more” — and how to achieve it: “This requires two things: scalability and resilience.”
Well, three things, probably: Morita would tell him that simplifying Ethereum requires marketing, too.
Ethereum’s decentralized and unofficial messaging has done a poor job of explaining what the world’s first smart-contract blockchain is, why it matters, or why anyone might want to use it.
Fortunately, Vitalik may have inadvertently fixed Ethereum’s messaging, too. “World ledger” is an excellent elevator pitch!
Using Bitcoin as a model, Vitalik’s new priority for Ethereum is technical simplicity: “One of the best things about Bitcoin is how beautifully simple the protocol is.”
He’s referring to Bitcoin’s code, which is simple enough that “even a smart high school student is capable of fully wrapping their head around and understanding” it.
(Note: I’ve looked at the code myself and, well…remind me never to match wits with a smart high school student.)
But Vitalik could equally have been referring to Bitcoin’s pitch to investors, which is beautifully simple, too: Everyone can immediately comprehend the appeal of “digital gold.”
“World ledger” may not be quite as intuitive as that, but it’s a major improvement on Ethereum’s previous attempts at branding: “World computer,” “ultra-sound money,” and “the app store of crypto” all required a good deal of explaining.
The explanation of “world ledger,” by contrast, seems far simpler: a decentralized platform “that stores civilization’s assets and records.”
Being simpler should give it a better chance to stick.
Simplifying any aspect of Ethereum will not be easy, however, as Vitalik warns: “Explicitly valuing simplicity requires some cultural change.”
But that change may already be underway — there’s a growing consensus that Ethereum’s development should be “reprioritized” in favor of the base layer (rather than deliberately pushing transactions to layer-2 blockchains).
Just as importantly, there’s a growing recognition that Ethereum’s marketing needs to be reprioritized, too.
For example, Tomasz Stanczak, the newly appointed co-executive director of the Ethereum Foundation, has acknowledged that marketing is part of what’s needed to rebuild Ethereum’s “social layer.”
“On the marketing side, I think we don’t want to create a brand name or advertising style of marketing,” Stanczak told Bankless on apodcastthis morning, “but better communication and clarity is also part of marketing.”
Better communication and clarity would fit Morita’s definition of marketing, too — marketing, he explained, is about showing people “the real value of what you are selling.”
The good news for Ethereum is that the value it’s selling can be a little aspirational — like Sony’s pocketable radio that didn’t quite fit into a pocket.
Similarly, Ethereum isn’t quite the world’s ledger just yet — but that sounds like a good thing to aspire to.
