Monetization Playbook #76 —Man is an animal that makes bargains
Economic Rockstars & Accountant Roadies
Not boring. That was my motto.
Imagine you're at the school disco.
You finally pluck up the courage to ask someone you've been eyeing all year.
Amanda Honey. That was her name. Even now, 35 years hence, the name still has a majestic ring to it.
She accepts…
–So what are you studying?
–Accounting, I reply.
–Her eyes send me a sign. I can feel an escape excuse brewing.
–Accounting's not as boring as most people think. I hastily offer.
–Yeah, I agree; I'm studying Economics.
Wow–this must be love!
Well, at least, this was the tune playing in the background.
For many, Economics is dull.
However, for accountants, economists are our proverbial rockstars!
In rock-band terms, accountants play at weddings and funerals, while economists play to a packed house at Wembley stadium!
Recent events reinforce this.
Economists get to wax lyrical about the worrying growth of the M2 money supply, the expectant asset inflation, and the bitcoin bubble.
How many accountants get podcast invites? Joe Rogan has no Big-four partners on speed dial!
Adam Smith is well known as the founder of classic economics.
A popular quote of his–
"Man is an animal that makes bargains."
–is perhaps as relevant to today as it was over 200 years ago.
The platform may have changed, but the message is the same.
An evolution of his thesis leads us to the efficient market hypothesis that modernized supply and demand thinking in the 70s.
The following conditions are critical factors in the determination of market efficiency.
Information is freely available
No market power of consumers and producers
The relevant factors that make up the market are easily accessible to any buyer and seller
Buyers have a wide range of products to choose from, and all producers sell a product identical or similar to their competitors' product
There are no transaction costs involved in switching between suppliers
The internet has brought forth the most significant opportunity for the realization of the efficient market hypothesis.
Numerous product choices, rating visibility, low cost of entry, modularized jobs to be done platforms such as Shopify, and freely available information.
So, if we live in an information-rich age, why is the win-loss effect still represented in power-law Pareto terms.
Winners still represent less than 1%of the entire content universe.
The most crucial element today is 'The bargain.'
We make bargains every day.
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These are bargains.
Attention for education. Attention for entertainment. Attention for engagement.
Internet-savvy businesses often apply a simple, but hard to compete with, formula.
–Offer 99% value while capturing 1%.
For a content producer, this can be daunting–but it is proven to work.
Follow your favourite YouTuber, Tik Tok'er, or Clubhouse jockey–and you'll see what it takes to stand out.
Internet businesses are competing under near-perfect market conditions–but some appear more perfect than others!