Obama's Betamax Politics

By Henry Oliner

President Obama is blaming poor communication (in other words, marketing) for voters' rejection of ObamaCare. He should take a lesson from Sony, once but no longer be the king of consumer electronics.

Some of the most instructive business failures have come from supposedly well thought out ideas and products that were rejected by the consumers in favor of another idea with different but preferred features.

During the video format competition of the 1970's the Sony Betamax was considered a superior video format by many of the videophiles. It sacrificed length for quality, which the company thought was more important for those who wanted to make home videos. The consumers, however, preferred the good enough quality of the VHS along with its much longer play time. They wanted more than home movies, they wanted to tape their favorite shows while not being a slave to programming schedules. Sony was selling better quality videos; but the consumers were buying a little more personal freedom.

This is how markets work. Market success is ultimately determined not by what you want to sell, but what others want to buy. One could easily dismiss the ignorant consumers for not appreciating the higher video quality of the Betamax, and one could easily lament the failure to market the superior quality format better. But that would miss the point that consumers preferred the features of the competitive product. Contempt for consumers is not an ingredient for business or political success.

The voters just made another Betamax decision -- this time in politics -- and rejected the ideas that were being pushed. The problem was not that they were uninformed, ignorant, or fearful. In this day and age where we are inundated with information and have choices of endless opinions and news sources, the voters have chosen ideas contrary to the ones being ordained by the government elite. While many left leaning political commentators try to analyze why the voters cast ballots "against their own self interest." These commentators can only visualize what they think the voters should want, not what they actually do want. Such pundits are Betamax thinkers.

The voters have a longer term view than many of the political leaders who still believe that a single small stimulus check will actually benefit the greater economy. The voters realize that somehow, someone must pay for these benefits. Voters realize that 2,000 page bills with hundreds of new regulatory agencies and thousands of new regulations will greatly infringe on their freedoms.

It is absolutely delusional to think that this was a marketing issue or a problem with an ignorant, fearful voter. The problem is not that the common voters are too unsophisticated to understand the complexity of the issues; the problem is that the intellectuals and the elites who largely created this mess thought their anointed leaders did.

This is plain to see; even on a lesser quality video.

Henry Oliner blogs at www.rebelyid.com