The economics of goody goody two shoes

I'm watching the praise of the commons grow with great interest (and joy) of late. Ever since the Power of Us article in Businessweek almost a year ago, there has been a growing acceptance (even beyond the 'geek community') of the notion that the 'davids' can actually take on the 'goliaths' of the world.

But it isn't merely plucky individuals, gathering to mount powerful DIY camps or creative commons licensing or mesh networks. There are successful people-focused businesses springing up from the commons (and other places) that support this growing unrest.

Today, I read the O'Reilly Radar's account of Doc's email regarding Moral Business (aptly renamed in the comments by Julian Bond as Ethical Business) and really resonated with the following:

We need transaction, but can't reduce everything to it. Although there are whole B schools that have been doing that for 100 years.

We need conversation as well. Which is why we wrote Cluetrain.

But relationship is what actually makes markets. I'm talking about real markets here: places where we do business and make culture. Relationship takes the passions we put into creating businesses and makes them work in the social context we call a market. (Did anybody ever go into business because they were looking for a way to please stockholders?)

You have to be generous in relationships.

Yes, we need to be generous in relationships. This market-based relationship building can't be fudged or faked. It will be sussed out as quickly as 'fake' friends are in our everyday relationships. What do we learn in the non-business/transactional world of relationship building? We learn the following:

• Relationships take time and energy.


• Relationship results are exponential to the amount you give into them


• Friends will help you in a time of need, but only real friends


• To have a friend, you have to be a friend


• The worst kind of hurt is that of a friend's betrayal. Some people forgive and forget, but once you cheat a friend, things will never be the same again.


• Relationships have boundaries that are respected


• Fairweather friends come and go, but true relationships last forever
  
  
• When someone makes you feel amazing about yourself, they are a good friend. When someone makes you feel crappy, they probably are not.
  

Okay, so I'm mixing relationships with friendships and, dammit, that is really difficult to achieve those personal levels of connection with larger communities....and with (yech) marketing?! No way...

But Flickr has.

And Apple has*.

And, um, Threadless, Mozilla, 37 Signals, Wikipedia, Craigslist and Kathy Sierra has. (I could go on)

So, why is that?

All of these examples come from companies who thought that passion, filling real needs, making others feel awesome, community and integrity were more important than making a buck.

Whoah...no money?! WTF?! ...sigh...before I get the comments...

Okay...so here is the bottom line. You can have relationships AND you can make money. It's not an either/or. But you can't tip the scale too far one way or another. It's a fine balance between fostering relationships and keeping your family fed.

And, yes, you may be able to make more money, faster, if you concentrate on the latter, and maybe that is what you want. Go for it. You may not care if you have relationships with your customers. You may even call them consumers and put them into spreadsheets and account for the amount of money they are going to make you and, so what if that doesn't last, because your goal is to put money in the bank quicker and move on. Rock on. That's your prerogative. But be wary because the competition is fierce. Globalization is a reality. 17 year-olds can build entire photo-sharing sites in a couple of weeks in their 'spare time' (between 2 jobs and an active social life). That quick buck may not be as quick as it used to be. Sure, there are many examples of uber wealthy technology companies who focused on the bottom line in the first bubble and got out rich, but the signal to noise ratio is incredibly high now. I can't keep up with the 'free' offerings.

And when you are counting on being supported by ad revenue, you are going to want people...lots of them...and longevity. And that takes real relationship building.

And then there are these new success stories. The ones that I referred to earlier. The ones coming out of the commons themselves. Those odd businesses, built on providing something good (be it an alternative or a service) for the community, who place the "making money" thing last (sometimes as an afterthought). According to the New York Times:

These are new-media ventures that leave the competition scratching their heads because they don't really aim to compete in the first place; their creators are merely taking advantage of the economics of the online medium to do something that they feel good about. They would certainly like to cover their costs and maybe make a buck or two, but really, they're not in it for the money. By purely commercial measures, they are illogical. If your name were, say, Rupert or Sumner, they would represent the kind of terror that might keep you up at night: death by smiley face.

Ack! How can a traditional "business-as-business-was-meant-to-be" business compete with this do-goodery? And to think...it may even catch on. This 'behaviour' will just add to the unrest in the commons. ;)

So...is it time to join the bleeding hearts or what? ;)

*I see this relationship starting to sour a bit as a more transaction-centric focus is invading Apple. Can they hold onto their fans through their growth?

[photo credit: Cherise Rouge]

[tags: pinkomarketing, cluetrain, marketing]