Tag: Fortune

Carrier Pigeons Helped Create the World’s Most Famous Banking Fortune

Whether in business, warfare or affairs of the heart knowledge, the more the better, is often the most crucial element in determining event outcomes. The ability to know what the competition for a business deal is strategizing is potentially game changing. A General upon learning details of a rivals battle plan gains immense advantages in plotting counter-strategy. Knowledge is often not quantifiable, but it is invaluable.

One of the most famous and consequential uses of real time knowledge occurred in Europe in 1815. Early in the 19th century information obtainable through communication channels about distant events was painstakingly slow to arrive. Roads were rough, unfinished, really little more than cart paths. There was no wire transmission or speedy organized courier services for delivering messages over vast distances. Word of the outcome of a battle, treaty or an important political affair could takes weeks or months to arrive where the result was most keenly anticipated.

The Battle of Waterloo is possibly the most famous military engagement in history. The battle site, the tiny, remote Belgian village of Waterloo, is synonymous today with one’s “final act”. Waterloo became Napoleon Bonaparte’s denouement. His inglorious defeat by the British forces, commanded by the Duke of Wellington, expedited his exile to the tiny island of Elba and the decline of France as a military power for almost a century.

Prussian, Austrian and Russian armies had allied to fight with the British against Napoleon. All of these great armies, moving across vast swaths of Europe terrain needed extensive provisioning, arming and logistic support to maintain troops as they girded for the great battle. This was an incredibly expensive enterprise. Massive funding was required to support the campaign.

The Rothschild banking family was already famous across most of Europe for providing a secure funding source for national governments. The Rothschild’s had established five branches of their enterprise. The largest, most important were based in Paris and London. The final Napoleonic war was largely funded by Nathan Rothschild of the family’s London branch. This house had provided large sums to both the British and the French. The Rothschild’s were famously indifferent to rulers and governments. Nathan Rothschild once famously remarked, “The man who controls the British money supply controls the British, and I control the British money supply”. His goal was to profit no matter whom was in power or won a war.

Nathan Rothschild knew that early knowledge of the winner at Waterloo, details of the battle, the severity of the loser’s defeat would be invaluable in financially manipulating markets to profit from the result. The family had invested heavily over the decades in field agents that forwarded tips and messages, fast packet ships and trained carrier pigeons to speedily deliver notes.

The arrival of the carrier pigeons in London with specific battle results from Waterloo provided Rothschild the information he needed to begin to plant rumors. Initially he spread the word that the British had lost. Investors began to adjust their bond and security positions in reaction to this negative news. Rothschild took opposite positions, and then, he strategically released the actual truthful news that Wellington had vanquished Napoleon. This enabled the family to profit on both sides of the trades. It is estimated that the Rothschild family extrapolated an increase in wealth of 20 times their pre-war capital.

The foresight to train a winged air force of carrier pigeons proved fortuitous and extremely profitable for the banking house of Rothschild. The edge they enjoyed in receiving real-time information, and spectacularly profiting from the knowledge, became legendary and only increased the perception that they were a family of financial Merlin’s. Their power and wealth has multiplied exponentially in the past 200 years and has been maintained to this very day.

In modern business and finance, the ability to glean information about competitor’s plans, information that will affect asset valuations and marketing strategies is invaluable. Governments spend billions of dollars trying to steal state and commercial secrets. Private investigators are used every day to scope out the fidelity and affairs of married spouses. Information is power.

Entrepreneurs can learn an important lesson from this chronicle about the Rothschild’s use of carrier pigeons. If your project has true commercial value it must be protected. You must assume that there are people working at the same time on a similar opportunity. Time is not your friend.

Whether you can uncover a competitor’s plan or an adversary learns your project’s details, the first owner of knowledge stands to maximize profit. Placing second in this process is a sure path to losing the crucial first to market product advantage. The Rothschild’s earned fabulous riches from simply learning the outcome of a battle before competitors. In order for entrepreneur’s to successfully profit from their efforts they must harvest every bit of relevant and available knowledge as quickly as possible.

Knowledge is invaluable, but it must be secured and utilized with diligence and due haste.

A Good Letter Can Make You a Fortune in Direct Mail

Now we go back to Maxwell Sackheim. Sackheim is also well known for originating the “Book-of-the Month” club. So what can you learn from Sackheim’s Book-of-the-Month club? More than you think. People are lazy. Getting people to take any sort of action is not easy. That’s why much of advertising uses deadlines and limited time offers. Sackheim used this human characteristic to his own advantage. Every month, members of his book club would be notified of that month’s book selection and unless they replied that they didn’t want the book – it was assumed that they did and it would be subsequently mailed out to them. Clever!

Sackheim originated the idea and now every “of-the-month” club operates like this. Have you experienced this?

Perhaps you’re thinking: “this wouldn’t work for me” or “my business really is different” then you’re missing the point and just not being creative enough.

You can use Sackheim’s “Negative Option Plan” to your business. If, for example, you have a web based business, you can have a member or subscription site which brings in regular, monthly income.

Your customers’ credit cards can be charged each month for their renewal of membership. People being lazy will rarely cancel their subscriptions bringing you a nice recurring revenue stream.

Sackheim’s Negative Option Plan forces people to take action to cancel their renewals. Many just can’t be bothered. you can take advantage of this little bit of human psychology. Of course, you will have to provide a good product or service that gives value for money.

In 1917, Sackheim met a young man called Victor Schwab who he hired as his private secretary. Schwab, working alongside Sackheim soon developed himself into a good copywriter.

Maxwell Sackheim also wrote a great book on marketing called: “My First 60 Years in Advertising”. This book is now out of print (as are most of these classics) but if you’re interested in the works of Maxwell Sackheim there is a book available by Jerry Buchanan called: “Billion Dollar Marketing.” You should be able to get this from your high street bookstore or on Amazon.

On similar lines to the “character” formula is what is called the “open letter” technique.

In 1921 Publisher A.W.Shaw collected 5,063 letters that had made big sales for their originators. The publishers whittled this list down and published 72 of these letters. These 72 were analysed and dissected. The result was their publication: “72 Letters and What Made them Pay.”

This book contains sections on letters that open doors; letters that increase sales; letters that turn prospects into your friends; in fact, letters for many occasions. 72 of them.

There are examples of letters that pulled 18% to 20% returns. Letters that gave 61% returns. What would you give for returns like that?

Take for example this opening sentence: “There is a man in Boston who has a unique way of making a living.”

Now who wouldn’t be interested in that? Most people, and that’s why they keep on reading the rest of the letter.

Even if you have to give something away to entice your prospect to reply, the letter still has to be effective.

Within the above opening sentence was a sufficiently good “hook” to get the prospect to read further. But the letter sooner or later had to reveal the “Big Idea”. Suffice it to say that this particular letter did get the results (a 61% return) and the pulling power of such a letter makes it well worthy of study.

“72 Letters and What Made Them Pay” will help you put together a persuasive letter for any situation, no matter what line of business you are in.

In 1923 John Orr Young and Raymond Rubicam form Young and Rubicam in Phildelphia.

In 1928 BDO merge with Garry Batten Co. to form BBDO with billings of $32m.

By 1928 Victor Schwab and his partner took over Sackheim’s agency after Sackheim decided to ‘call it a day’. He was responsible for creating ads for Dale Carnegie; Charles Atlas; and Sherwin Cody’s courses (as was Sackheim).

His famous works included the best selling 1930s classic: “How to Win Friends and Influence People”.

He wrote a series of articles called: “How to Write a Good Advertisement” and introduced a 5 step formula.

His series of articles were later turned into a book, also called: “How to Write a Good Advertisement.”

In 1930 James Webb Young worked as a professor and used his lecture notes to publish his first book: “How to Become an Advertising Man.”

In 1930 Advertising Age is launched in Chicago

In 1934 Another master writer was Robert Collier. He went to work in New York for his uncle s publishing company. His first successes were that he sold many thousands of the Harvard Classics. These were books put together by Dr.Eliot of Harvard and sold by Collier as what became known as the “Famous Five-Foot Shelf of Books.”

Collier had an idea of writing a set of books on psychology. He worked day and night to get them finished. The books were titled: “The Secrets of The Ages.” He sold over 300,000 sets of that title and went on to write more self-help titles and books.

He was a prolific writer but his best abilities were in writing killer sales letters.

In 1934 he wrote, the now famous: “The Robert Collier Letter Book.”

Here are just a few of his secrets to writing sales letters.

Collier became famous for one letter in particular. His: “Will you do me a favor?” letter. He conceived this idea when he read about a manager who asked one of his competitors for a favor – he wanted to know how to handle customers that took advantage of their terms. And this technique helped to bring the two companies together.

Collier thought that this technique may well work in print. He wasn’t wrong!

One of his letters was responsible for selling 20,000 raincoats and over a dozen other products.

The letter contains some strong psychological principles.

Also, people like to help. Just as Collier knew all those years ago, people like to give opinions.

If you operate your business off-line, ask in your direct mail or your letters for people’s opinions.

If you operate on-line, a good technique to use is polls. If people aren’t yet ready to buy, they do love to give their opinions.

It becomes even stronger if you give them something for free in return. Something of value, like a report with some useful information. But what ever you give them, it has to be useful.

Now you may be thinking, OK, his letter were written over 70 years ago. surely, this technique is out-dated. Think so?

Just before his death in 1950, Robert Collier was asked to pick his 15 most powerful and hypnotic letters. These were compiled and sold as: “Robert Collier’s Million Dollar Sales Letters.”

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