The Four: The Hidden DNA of Amazon, Apple, Facebook, and Google

by Scott Galloway

here’s the trick—made it scarce.

was expensive and had its own vertical distribution (storefronts) in the form...

it was the tension between the two that Brand was interested in, and it was in that tension where he foresaw innovation.

Google (and Facebook in a different context) has mastered that tension. It takes advantage of the declining costs of distribution by giving its users access to a world of previously expensive information, then extracts billions in value by being the new gatekeeper.

Facebook too has leveraged the tension between information’s ever-lower costs and its...

Facebook gets its users to create the content, then it sells that content to advertisers so they can adve...

It’s not “stealing” our baby pictures and political rants, but it is extracting billions of dollars from them using technology and innova...

That’s world-class “b...

by urging consumers to “like” their brands, they gave Facebook an inordinate amount of free advertising. After brands built this expensive house, and were ready to move in, Facebook barked, “Just kidding, those fans aren’t really yours; you need to rent them.”

The organic reach of a brand’s content—percentage of posts from a brand received in a fan’s feed—fell from 100 percent to single digits.

Now, if a brand wants to reach its community, it must advertise on—t...

A mess of big companies thought they were going to be Facebook owners and ended up Facebook renters.

brands complained and took the abuse.

It’s pretty clear where Amazon is headed: 1) Take over the retail and media sectors, globally; and 2) Replace the delivery of all these products (goodbye UPS, FedEx, and DHL) with its own planes, drones, and autonomous vehicles.

their culture of innovation and access to infinite capital will roll right over them.

the key to a great con is that the victim never realizes he was conned—indeed, he believes he is about to be a big winner right up until the last moment.

Aspirational horsemen always show a willingness to go to market in ways unavailable to their old-guard competition.

Uber, for example, operates in blatant contravention of the law in many, perhaps just about all, of its markets.

And yet, investors—including governments—are lining up to hand the company billions. Why?

Because they sense that, in the end, the law will give way before Uber does; Uber is inevitable.

And they are probab...

There are laws, and there are innovators. Good money is ...

despite all of this, Uber continues to sign up drivers and riders at a furious pace—myself included—because its basic service and simple app are vastly superior to the coddled, protected taxi model.

Uber has recognized that if an industry is broken enough, consumers will conspire to violate the law in favor of a far preferable service.

Amazon has also effectively conspired with half a billion consumers to use algorithms to starch the margin brands used to garner and deliver those savings to their ally, consumers.

A retailer leveraging its power to grow a higher-margin private label is not new. We’ve just never seen anybody this good at it.

This alliance between Amazon, consumer, and algorithms gives consumers enormous value, and Amazon’s resultant (blistering) growth garners hundreds of billions in shareholder value for employees and investors.

IN THEIR BESTSELLING BOOKS, Ben Horowitz, Peter Thiel, Eric Schmidt, Salim Ismaiel, and others argue that extraordinary business success requires scaling at low cost, achieved by leveraging cloud computing, virtualization, and network effects to achieve a 10x productivity improvement over the competition.

But that explanation ignores a deeper dimension that has nothing to do with technology.

From the perspective of evolutionary psychology, all successful businesses appeal to one of three areas of the body—the ...

Each is tasked with a different aspec...

For anyone leading a company, knowing which realm you play in—that is, which organ you inspire—dictates business strategy and outcomes.

This is prototypical Galloway - blunt, in your face, over the top - partially if not mostly right and getting you hooked on what he's going to say next.

For most businesses, the consumer’s brain is the ultimate buzzkill and competitor.

Walmart now commands approximately 29 percent of retail in the United States.2 Despite low margins, its sheer volume produces gargantuan profits.

There is enormous shareholder value created by the winner in the fight against the brain, but it’s winner-take-all.

Once the brain determines the rational best choice, it’s decisive, monogamous, and loyal.

Most companies are not, and can never be, the low-cost leader. It’s a select club that demands scale for long-term success.

The heart is a vast market. Why? Because most of our actions, including purchases, are driven by emotion.

The heart may be irrational, but as a business strategy, targeting the heart is a shrewd and sober strategy.

In fact, the explosion of consumer marketing that followed World War II was targeted, almost exclusively, at the heart.

For a marketer, each string tugging at the consumer’s heart translates to margin.

There’s (among others) beauty, patriotism, friendship, masculinity, devotion, and above all, love.

These are values you can’t put a price on—bu...

Even if their competitors gain an edge (like logistics or value), they can survive, and even thrive, as long as they continue to connect w...

If this all sounds superficial, it is. That’s the nature of passion—and the heart is one of the few forces that can o...

The digital age, with its transparency and innovation, has declared war on the heart.

Search engines and user reviews are adding a level of transparency that’s starching much of the emotion from purchase decisions.

Google and Amazon have signaled the end of...

The consumer packaged goods (CPG) sector, which may be the largest consumer sector in the world, was built on the heart-to-purchase relationship.

With appeals to the heart increasingly difficult, brands that appeal to the genitals are thriving.