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Lie to Me

Scott Galloway@profgalloway

Published on June 9, 2017

Lie to Me

There are times a CEO needs to withhold information. For example, “If we don’t close this round we’re out of money in 60 days, now back to work everyone!” is not motivating. Sometimes you also have to bend the truth: “Our product has established a clear leadership position in the marketplace.” Great benders who are benign are called visionaries. However, on the whole, lying is a payday loan. Your words begin to lose purchase. Oh, and it’s wrong.

Mitt Romney was mistaken: corporations aren’t people. The same rules do not apply. Increasingly, the prevalent strategy for large firms seems to be: “Lie, apologize, and carry on.”

— Google told Congress information wants to be free, and that it was still early to register the impact Google was having on newspapers.

— Facebook told brands they would own their fan communities, and that the cost of building these communities was a good investment. It wasn’t.

— Amazon claims it’s leasing planes and purchasing tractor trailers to supplement other delivery services during peak periods. So FedEx, UPS, and DHL, prepare to be “supplemented.”

Companies perceived as innovators are made men, not to be bothered regardless of their offense. They are too cool for you, me, America, capitalism, the planet, SF real estate prices, and so on. And the wheel spins. There is a justice system, but it’s blind much of the time. It’s good to be rich, or a tech giant, when caught in a lie.

The latest example: When Facebook sought approval of the acquisition of WhatsApp, they assured EU regulators that it would be impossible for the two entities to share data in the short term. This assuaged regulators’ concerns over privacy, and the acquisition was approved. Spoiler alert: Facebook figured out pretty fast how data could jump silos. So, feeling lied to, the EU fined Facebook $122M. Facebook felt WhatsApp was worth $19B, so a .6% premium for increasing the likelihood the acquisition was approved is a no-brainer. This is tantamount to getting a $10 parking ticket for not feeding a meter that costs $100 every 15 minutes. Yes, you should NOT feed the meter.

Wealthy people and firms increasingly play by different rules. An audit or a 100M+ euro fine can be disruptive or ruinous for a middle-class family or mid-cap company. But wealthy people and firms have the resources and vendors (lawyers, accountants, lobbyists, communications execs) to walk back the lie, airbrush it, and negotiate down the penalty. The culprits here are not the firms, or government (the go-to blameables), but our citizenry. Our society prompts elected officials to engage in gross idolatry for the innovation class, at the expense of everyone else. The current algebra of penalties reflects this sycophancy. A penalty only discourages bad behavior when:

Our groupie citizenry has not provided the cloud cover to punish bad behavior — demanded the algebra (penalties) that discourage it.

We need to get our heads out of our asses. If a firm can get to $475B in value (Amazon) while paying almost no income or sales tax, we aren’t going to be able to fund soldiers, teachers, or firemen. If a firm can defy a court order to let authorities examine the contents of their products (Apple), we’ve decided brands know better than our government. Should we then ask Apple to bomb airstrips in Syria and build our airports? If Google can command 90%+ share of the most lucrative market in media in the EU (search), and not be regulated, then who will retrain all the media execs venturing to Cannes next week, who’ll soon be out of work? Note: we can all discuss this at Google’s YouTube Beach at Cannes.

These are amazing firms that do a great deal of good. However, they aren’t concerned with the condition of our souls and will not take care of the elderly. Without market controls, regulators, and a citizenry that demands lawmakers grow a pair, we barrel toward a dystopia where firms, not the public, make the rules. We may already be there.


My colleague NYU Associate Professor of Marketing Adam Alter has written a powerful book: Irresistible. The book helps firms develop crack-like products, while providing parents with guidelines for the relationship between your kids and their screens. There are several tools for making your product addictive, such as giving the user the ability to set goals, incorporating a social element, and presenting unresolved questions (cliffhangers). But the real skag is intermittent, unpredictable rewards. The slot machine is the correct metaphor. Like most important things in life, it’s best explained by an episode from Rod Serling’s The Twilight Zone, which aired on CBS in the 60s.

In episode 28, “A Nice Place to Visit,” a criminal finds himself in heaven, where he can never lose. So he gets bored — when winning means nothing, he realizes he’s actually in hell. Winning may boost dopamine, but only when losing is a constant.

At home with my kids, I’ve been losing a lot lately. I commute from Florida to NYC for work and increasingly, when I come home, my kids don’t even look up from the dinner table. My oldest often asks Alexa rather than his dad. Most overtures, questions, comments, observations go to mom.

But there still are the intermittent rewards that have me hooked on the whole kids thing. Two nice hits of dopamine this week:

— We’re in London and have the boys in soccer camp (when in Rome). Walking through Hyde Park, I was charged with fetching my youngest when he spotted me and shouted to the other six-year-olds on the field, “There’s my dad, look how big he is!” Pretty sure he meant it in a good way. He then ran over to me and, uncharacteristically, jumped into my extended arms.

— We were watching Monster Jam the other night, and my nine-year-old began stroking my head. He likes the way it feels after I’ve shaved it (go figure). Unsolicited affection from your children is about as close to the definition of authentic there is — no motive, no planning, no agenda … just raw, instinctive affection.

I aim to have a lot, like a shit-ton, of dopamine coursing through my brain the rest of my life. I’ve been writing down things people I love do that give me exceptional reward — a fun exercise. I plan to share my list with some of them and ask them to do more of those things. I’ve added two to the list. I want my youngest to enter the room and announce, “There’s my dad, look how big he is.” And I want my oldest to stroke my head.

Life is so rich,



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