I got this question from Peter:

It seems to me that “wisdom” is little bit of a “mushy” world
view/philosophy of life concept, whereas web traffic is a matter of
knowledge, technique, and perseverance. Perhaps you could draw a
closer correlation. Aside from the big picture idea of “crooks often
end up in jail” vs. “hard work and quality products tend to sell
well”, I’m not sure i see the connection between wisdom and profit, or
whether it is virtuous to pursue one, for the other.

I replied…

Peter,

Wisdom is a squishy word, isn’t it? Mystical. Ethereal. People who use it a lot are often into “woo woo” stuff.

Wisdom is mystical. It eludes most people. Some have none. Some mock the very idea. Some only talk about it.

Let me give you an example:

For years I told people that building a thin, direct-linking, “Google Cash” affiliate business was short-sighted and would ultimately fail. A business no more sophisticated than that was a house built on sand. I was saying that in 2003, when the Pay Per Click affiliate gold rush was going full blast.

One day on the Warrior forum, a hot thread erupted when marketers realized that Google employees could clone their entire business with a simple copy|paste. I blasted out an email: “Whatsa matter with you, you never thought of that until now??? Of course they can, and they will. If your business can be knocked off that easy, you don’t have a business. You have the commercial equivalent of a shantytown.”

Astonishingly few people listened to me.

People didn’t start getting smart until Google itself started beating them bloody with a lead pipe.

Dang, all those fake product review sites, business built with as little substance as possible and zero interest in the legitimacy of the product. How could any sane person believe that would last? I know one guy who actually sued Google and they had to settle with him out of court, because he proved one of their employees had knocked off his business.

Once I had a client who thought his $1 million per year direct-linking affiliate income was going to last forever.

This guy had an advanced degree from one of the top 5 universities in the world. Ivy league, baby. This guy was SHARP. He could out-analyze anyone, anywhere.

I warned him that the time bomb was ticking and he needed to build some real Internet ‘real estate.’ He disappeared and sought advice elsewhere.

One day he got completely BANNED from Google. As in, don’t come ’round here no more, we don’t want you in any way, shape or form. Recess is OVER!

That, my friend, is the difference between knowledge and wisdom.

Knowledge tries to game the system. Wisdom cooperates with the principles of the system.

Knowledge is interested in what you can get from a deal. Wisdom cares about what seed you sow.

The lowest level of insight is knowledge. Basic facts, like California is south of Oregon. Or 4 x 4 = 16.

The 2nd level is tactics or techniques. Plans based on knowledge. Methods, shortcuts, ways to get things done. If you sell a spray that gets the tangles out of hair, A headline that says “Gets tangles out of your hair” probably works better than “You can get tangles out of your hair.”

Why? Because the first refers to what the product can do; the second refers to what you can do. Lazy people want a product that does something for them.

That’s a tactic. Advertising in a certain kind of media is a tactic. Adding a line of code to your website that makes something flash on and off, that’s a tactic.

The 3rd level is strategy. Strategy is the over-arching plan, the approach. Strategy is knowing that the audience comes first, the message comes second and the medium of communication comes third. Strategy is defining yourself in terms of what really matters (“We’re in the business of shipping our customers’ goods”) instead of the assets you have (“We’re a railroad.”)

The 4th and highest level is wisdom. Wisdom sees the highest purpose in everything you do. Wisdom doesn’t let small things dictate big things.

Since any particular way of getting web traffic is a tactic or technique, web traffic doesn’t appear to have much to do with wisdom. Or does it?

I’m going to assume you’ve been in the business or marketing world for awhile and have been around the block a few times. You’ve been to a few seminars, you’ve bought books and CD’s, you’ve tried a thing or two.

If you have, you know that there’s one kind of sales pitch that works on beginners (insiders call it “bizop” or business opportunity), and there’s a different kind of pitch that works on experienced business people.

Bizop pitches toss around words like “dreams” and “freedom” and “walk away income” and “residual income.”

Experienced business people are much more interested in numbers, results, proof, and the real story behind the story. They’re interested in reducing risk, understanding markets and creating unique customer experiences.

Bizop pitchmen burn people out. They tell them what they want to hear and sell them what they want to buy. They tell stories about cotton candy and unicorns and when their stuff doesn’t work, they tell the customers they’re doing it wrong and it’s their own fault.

EVERYTHING they do is about tactics and strategies. There’s no long term plan to mature a customer. It’s a revolving door. The goal is to suck as much money out of them as possible in 90-180 days.

Actually it’s very easy to sell tactics and techniques. But most people don’t know what to do with them because they have no strategy and no wisdom. Tactics alone usually only last about 3 months. The whole Google Cash affiliate thingy was lucky to have lasted 5 years. I thought it would last 5 months.

Wise mentors alert their customers to the harsh realities and inform them what it’s going to take up front. They attract fewer at the beginning but they have a strong following years later. They teach them strategies and wisdom.

  • Wisdom knows that things like “which page won the latest split test” can never ultimately dictate the direction of your business because all you’re doing is optimizing for the short term. Wisdom knows the truth always gets found out in the end. Wisdom knows that a marketing medium is not a business and that traffic alone can never build a sustainable business.
  • Split tests measure instantaneous reactions – most often clicks – not sustained behavior over time. Pepsi usually wins taste tests but Coke has consistently won in the long run. Never forget that!
  • Wisdom is wary of “cynicism inflation.” Wisdom knows most people apply a “hype filter” to everything they hear. When some guys promise a result, you know they over-deliver. So you add 50%. When others promise a result, you divide by 10 because you know they always over promise and under-deliver.
  • Wisdom exercises restraint. Wisdom regards short-term profits with a jaundiced eye.
  • Tactics and strategies see weeks or months or perhaps a year or two. Rarely more. Wisdom sees 10, 20, 30 years into the future.
  • Wisdom sees the difference between a fad and a trend.
  • Wisdom knows that people are ALWAYS more valuable than things.
  • Wisdom prefers the short term pain of correction and criticism because it produces the long-term pleasure of stability and excellence.
  • Wisdom hates debt. Wisdom saves up for hard times.
  • Wisdom knows that the truth is never for sale. Wisdom never accepts a bribe.
  • Wisdom knows the difference between a friend and comrade. A comrade only loves you because you and he have fought in battle together, and you both support and oppose the same things. But a friend loves you regardless of your beliefs or your changing position or your mistakes.
  • Wisdom seeks first to understand, then to be understood.
  • Wisdom builds the barn first – then builds the house later.
  • Wisdom resists moving the ancient boundary. Wisdom believes that just because your grandparents and great grandparents are dead, doesn’t mean they don’t get to vote. Wisdom respects the accumulated experience of generations.

Most people think a politicians’ private life is nobody’s business but his. Wisdom understands that a guy with a mistress will pass the cost of her luxuries on to you.

Wisdom knows that a good reputation is the most desirable thing you can have, and builds a trusted brand by delivering great customer experiences.

Wisdom knows that good educations cost money and free opinions are worth what you pay for them.

A smart person always questions his judgments in big decisions and consults as many experienced advisors as he can.

Wisdom pays attention to how a potential business partner treats the “little people.” If your new compadre is rude to the waitress at Denny’s…. don’t worry, your turn’s coming.

Jewish tradition holds Wisdom to be the very first created thing. Solomon writes:

Out in the open wisdom calls aloud,
she raises her voice in the public square;
on top of the wall she cries out,
at the city gate she makes her speech:

“How long will you who are simple love your simple ways?
How long will mockers delight in mockery
and fools hate knowledge?

Repent at my rebuke!
Then I will pour out my thoughts to you,
I will make known to you my teachings.”

And of Jesus, the scriptures report: “And Jesus grew in wisdom and stature, and in favor with God and man.”

I pray the same for you.

Perry Marshall