the market with advertising because they don’t need to advertise. They possess
entrepreneurship’s Holy Grail: a
productocracy
.
Whereas a meritocracy pulls power to the skilled,
a productocracy pulls
money
to the value creators, businesses who grow organically through peer
recommendations and repeat customers, compelled by a distinguished
product/service not readily offered elsewhere.
The short-and-sweet definition? Your product contagiously sells itself. Take
for example the cancer corollary, a pure productocracy. If you owned the cure
for cancer, how long until you made a fortune? Once a small group is cured, your
product’s growth would snowball by raves and recommendations. News
organizations would stampede your office with billions in free publicity. The
need to advertise would be like pissing in the Pacific Ocean to remedy a low tide.
Ultimately, a productocracy
is what separates average, survive-the-month,
zero-growth businesses who are ad dependent from ones who grow
exponentially through an expansion loop, or network effects.
In my pizza example, the Oregano’s product and concept is so good that
satisfied customers fuel the expansion loop, repeating visits and recommending
the restaurant. One satisfied customer creates more satisfied customers,
accelerating growth.
One plus one equals three
. A productocracy is like a raging
inferno, whereas advertising is the gas, an optional accelerant, not a necessity.
A productocracy is also the key to attracting value-vouchers, as discussed in
the money/value dichotomy. With a productocracy,
all excuses and drama
become meaningless. No one cares that you failed four prior businesses. No one
cares that your teeth are jacked or your dad didn’t love you enough to watch
your T-ball game. A productocracy is so impervious to externalities it can
overcome a crappy location.
For example, there’s a busy street corner near my gym that
looks
like a nice
restaurant location, or so it seems. For years, this cursed corner killed so many
restaurants it’d make Jason Voorhees’s hockey mask smirk a grin. None of the
upstart restaurants offered anything different. Average food, average ambiance,
average experience. New restaurants would close down just months later.
And then Oregano’s moved in. Not only has it survived, it’s thrived. Curse?
Bad retail location? Four prior restaurant failures at this same location?
Immunity. A productocracy
allows owners to print money, and it doesn’t care
that Coco’s couldn’t survive at the same location..
A productocracy is also behind another West Coast restaurant sensation, In-
N-Out Burger. Anytime a new store opens, lines form for miles. Again, I can’t
recall ever hearing them advertise either. They might, and if they do, it simply
stokes the fires.
So, think about your own city. How many restaurants are in your town that
are always crowded no matter what time you go? And ask yourself, do they
advertise or mail coupons? Or did you just “get wind” of them through a friend
or the media?
Of course, a productocracy isn’t just limited to restaurants.
Any product or service can reap the rewards of a productocracy. My first
book sold hundreds of thousands of copies.
By the time you read this book, it
will probably be approaching the million mark. So did I bribe my indie
publishing success by throwing thousands of ad dollars at it?
Nope. My total promotional ad spend amounted to less than $3,000—all of
which was spent in the first two months of release. Moreover, I couldn’t advertise
on Facebook as they ruled that the book was a “get-rich-quick” scam.
Additionally, my first edition’s cover was a horrible orange-and-green goober
that screamed “cheesy!” So let’s just say, my self-publishing venture started like a
swim with cement blocks chained to my ankles—I went to market with a two-
buck cover and a roadblocked ad strategy, and the title stunk of greasy
infomercial guru. Wow.
And yet it still sold. All because of a productocracy. Readers loved it and told
friends, coworkers, and family. My reader emails often start the same: “My friend
recommended your book…” For example, here’s just one of many; however, this
one unveils the power of a productocracy:
Dear MJ, I’m
twenty-nine years old, from Santiago Chile. I have a degree in
software engineering. I had been always interested in self-development, business,
and entrepreneur books. A couple of months ago, I was looking for something to
read and I came across an article about the book
Money: Master the Game
by Tony
Robbins. I was not convinced, but surely that would be my next book to read…
until I read a comment in that article from a user named Chris.
Chris said: “Before even thinking of purchasing this book, have a look at
The
Millionaire Fastlane
by MJ DeMarco. This is the only honest business book I’ve read
that spells it out clean and clear. No bull, just plain honesty. If you want to be
wealthy, this is where you start. It’s how I became financially free, and I’m thirty…
not seventy.
Bada-Bing, Cha-Ching. Just like that, another sale.
And this is just one random recommendation
from one random stranger
made on one random blog about another author’s book. How many others read
the comment and did the same? And how many more similar comments are
scattered throughout the web? A lot. And every one of them sells for me
perpetually independent from my time, day after day, hour after hour.
THE PUSH (BUY MY SHIT) VS. THE PULL (YOU WANT MY SHIT)
Every podcast and interview I’ve ever done happened because I was asked. I
didn’t solicit myself in a cold email, begging to be interviewed. Likewise, I won
translation licenses in the same manner: Publishers contacted me, asking to be a
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