I had this thought as I wrote the book that the best of the 21st century
combines the best of the 19th and the best of the 20th and then my joke is the
worst combines the worst of those two centuries as well what I mean by that is
if you look at the 19th century and pretty much all human history before
business was conducted almost entirely locally you you almost all physically
made goods were made by someone who you didn't just know them your whole life
you knew their great grand your great-grandparents knew their
great-grandparents and in many cases your clothes your bed your house were
made by you or your family and to the extent that there were services you know
the equivalent of lawyers and accountants and doctors and those would
also have been produced locally there's always been long-distance trade but that
was really just very small number of luxury goods that had very little impact
on the material lives of everyday people so you had profound intimacy you know to
the point where if you lived in a certain neighborhood in Brooklyn or a
certain village in France the beer the bread the cheese everything was how we
do it here it was fully intimate and you go to villages over and they do it some
other way and that's totally different and see you had this incredible
enmeshment between producers and and consumers then you have the 20th century
which is about people in one place producing goods for people all over the
world so you know you have massive manufacturers in Atlanta or New Jersey
or Chicago or who are producing soda and candy bars and eventually furniture and
cars and all of these goods and they're made in one place made in huge volume
and then shipped everywhere in the world and just the nature of that kind of
transaction is scale you you can't know all that much about who's buying
coca-cola in some village in Vietnam or what things about
you know a Ford car people in South Carolina like better than people in
Alabama do or whatever you just make you know with some variation you make the
same set of products and ship them everywhere and so that's scale and scale
brings a lot of benefits that that small intimacy doesn't benefits economies of
scale you can make more stuff more cheaply spread it to more places but now
that doesn't work very well big scale is in crisis you look at the big scale
consumer goods companies like Procter & Gamble or Unilever and they're really
struggling for growth they're struggling to basically everyone who wants Tide
soap and Oreo cookies already has tied soap and Oreo cookies and you know you
you sort of go buy a candy aisle and you see the problem sure we can have M&Ms
with pretzels and M&Ms with caramel and M&Ms with peanuts and M&Ms with a
million other things but you're not really transforming the experience of
eating candy and we live in a world where people are probably eating as much
candy as you want so you have these companies fighting over market share
sort of unable to create really transformative value but then you have
intimate products you have products like let's use chocolate you have people
entrepreneurs creating new ways of producing lovely chocolate bars but they
don't have to only produce for people within walking distance or driving
distance of their factory and they don't have to produce 300 billion a day to get
them all over the world they can produce a reasonable amount of them and they can
use the tools that the 21st century offer the internet of course but
shipping and logistics there's been revolutions that make it just so much
more affordable for a relatively small company to physically get stuff all over
the world without owning big trucks without owning big warehouses artificial
intelligence is making it increasingly possible to match unique producers with
unique buyers to get the to combine the product with the buyer who most of
I'll use it so that is what I call intimacy at scale it's allowing you to
do the 19th century thing of creating that unique thing I often talk about
candy and bread and beer cuz you could picture it but the same goes for
accounting services and advertising services and medical a million other
pretty much any kind of business to consumer a business to business product
or service you can think of and it allows you to do those things but do
them at scale do them where you're reaching people all over the world who
most want what you have to offer that's the key the we all know the Adam Smith
prices where supply meets demand and the the assumption with Adam Smith in the
wealth of nations is that products are just this undifferentiated thing bread
is bread and so you if people start liking bread more and paying more money
then new people make bread and the way economists talk about it is prices
actually at the point of indifference or they call it the curve of indifference
for complicated reasons but basically you're selling to the least interested
buyer that's the price if pack of Oreo cookies costs $2.99 that's because
they've figured out that if it was three dollars and five cents some people would
be like forget it I'm not gonna buy it so you're you're targeting the least
interested buyer the passion economy is about targeting the most interested
buyer so the the the the indifferent the partly indifference price is rooted in
the idea that you need that kind of massive scale to reach everyone you need
that last buyer to buy your thing to make the whole system work but with the
passion economy you could just focus on way up on on the demand scale where
people so love your product they'll pay far more for it maybe six dollars or
twelve dollars or $18 whatever it might be and in that it's not just that you're
getting more money from those people unfairly it's that you're creating a
product that can only exist if you're able to produce a product at that
price which you can't do in the old system get smarter faster with new
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