The Jerry Shereshewsky Interview. Part One, The Early Years.
The Ambassador Of Internet's Quan
By Tim McHale
Obviously, the first similarity between Jerry Shereshewsky and Jerry McGuire is their first name. Another is that they have both dedicated their careers to a mission. The third is that they are Ambassadors.
For the last decade, as well as now as CEO of Grandparents.com, Mr. Shereshewsky been known as the "Ambassador Plenipotentiary for Madison Ave." Cruise is the "Ambassador of Quan". What does Quan mean? According to the Urban Dictionary:
"Quan is when a person "is one" with something. It suggests unity or completion. It's a loosely defined quality, combining or uniting skill with love and respect, as well as money."
Beginning with part 1 of this 4-part series; we see how Mr. Shereshewsky "is one" with bringing unity to digital publishers, ad agencies and marketers on Mad Ave. He has the love and respect of those who know him across the media field. You might say he's "quan"-tified digital advertising; with a value system that has nothing to do with money!
Tim: How are you?
Jerry: Doing very well, thanks!
Tim: Before we get into your progress at Grandparents.com and industry trends, tell me about your career background. You have deep experience in direct marketing, traditional and interactive media, all from a unique vantage point. What have you learned?
Jerry: Well, this is my 39th year in our industry! I began my career in the mailroom at Y&R in New York. I then moved up into research, then Traffic and then to an Assistant Account Executive and then an Account Executive. From there I left New York and moved to Portland, Oregon with McCann. A year later I moved to Atlanta with McDonald & Little Working in the advertising from outside New York really helped me in numerous ways.
Jerry: For one, it helped me wear multiple hats. By the time I came back to New York, I had learned the business from all the disciplines, account strategy, media, creative and new business that I would not have gotten an opportunity to do working on Madison Avenue. When I did return, I came back to Y&R where I took on Account Supervisor responsibilities. I moved up fairly quickly to the SVP, Management Supervisor level and then moved over to Wunderman as Director of New Business. Then to Burson-Marsteller in their Event and Entertainment Marketing group as "creative director" (which means New Business).
Tim: You hit on all the cylinders.
Jerry: That's right. Then, in 1990 I got laid off, which was a traumatic experience for me, personally. I thought I'd be with Y&R for the rest of my life. It actually turned out to be a blessing. I went to work for [Bertelsmann] where I work in their direct marketing group and was head of sales and marketing for RCA Special Products.
Tim: What did you do there?
Jerry: We basically repackaged RCA's music by re-releasing albums and developing compilations for premiums, incentives, direct marketing products, etc.
Tim: That's great!
Jerry: While I was there in the early 1990's, I became very interested in this thing called the Internet. I had always been interested in technology that was coming down. In 1980 at Y&R, I ran the Atari home computer account which was actually quite funny because I didn't know what a computer was when I went to work on that. By the time I got to Burson I was the only executive in the company with a PC on my desk.. At Bertelsmann I remember my boss saying, "What do you want a computer for? You have a private secretary!"
Jerry: I said, "I need to do things that I can't ask a secretary to do."
Tim: You were right.
Jerry: I find it easier to do them on a computer than with the ink and paper.
Tim: I have to believe that your Wunderman experience was invaluable in getting into the record business and then of course right into the Internet.
Jerry: My Wunderman experience was part of it. It was also the sum total of all the hats I had worn from the beginning of my career up until that point. By the time I got into the Internet I looked at marketing objectives from a 360 degree perspective.
Tim: Of course.
Jerry: There is an old expression. When you have a hammer everything looks like a nail!
Tim: What does it mean?
Jerry: In our business, if you are a direct marketer then your answer to every marketing problem is a direct marketer's answer. If you are a PR guy, your answer is a PR program. If you're a general advertising agency guy, your answer is GRPs and a new 30 second commercial.
Jerry: What that combination of ingredients has done for me, is that's made me pretty agnostic. I understand how direct marketing works and I understand where to draw the lines. I can say, "Okay this is stuff that we need to be very rigorous and quantitative about." Then there are other problems that need a much softer, emotional touch.
Tim: Makes sense.
Jerry: I've become a huge fan of PR and its power; something I think is totally misunderstood, in general, in the advertising side of the world.
Tim: I agree. Tell me about how you got into the online space.
Jerry: In 1991, I became very interested in this thing called the Internet and how it was going to impact the music business. It was very clear to me that it was only a matter of time until bandwidth was going to get to a point where music could be moved digitally.
Jerry: As I started poking my very corporate nose around the 'net, a parade of people hustled and bustled all around me in a very secretive type of way. I had never heard of them before. They were called venture capitalists!
Jerry: I was naturally curious and got to know some of them. They started asking for my opinion on things and before you knew it they were showing me products from companies that they were backing were. It was a fascinating place to be. I got to see some very futuristic things and met many technology visionaries. All of which only incentivized me to go further in this arena. Then one day, one of the bankers brought in a very interesting guy by the name of Seth Godin.
Jerry: Seth had a company called Yoyodyne Entertainment. He had a simple principle; that game shows were cheap to produce, enormously popular and were the content that caused radio to become a success and then to cause television to become a success. Back then there was no reason to think that game shows would not cause the Internet to become a success.
Tim: I'm not sure I understand.
Jerry: When you think about it, one of the things about a game show on radio or television is that, almost without exception, there was a passive audience listening to or watching some person or small group of people contend for prizes.
Tim: Of course.
Jerry: With the internet, you could have a virtually, unlimited number of people contending for those same prizes.
Jerry: For example, if you were on "The Price is Right" TV show, you and a few others would be contestants. But online you could be one of 100,000 people playing "The Price is Right," all at the same time!
Tim: What year was that?
Jerry: I met Seth in 1995. By then he had a narrow focus from a media standpoint that email was the killer app. Remember, most of the world that was online -- all 46 of us - were using 14.4 and 28.8 modems. You would have to wait a year for a page to load, not a great user experience. But email was pretty instant. Seth had this notion that you could create a game show in which large numbers of people were contending for prizes and conduct that game by email. And one of the things that I noted as he described this concept was that he created not just a reach model, but one which had lots of frequency as well.
Jerry: Imagine that you're a player. We would ask you a question. With email we could ask 100,000 people or 1 million people. It didn't matter. It was the same question, asked at exactly the same moment. As a player, you would your answers and then the game show would send you back an email that confirms that we received your answer, give you a one last chance to change your answer and then on, let's say, Thursday afternoon or Friday morning, send out the correct answer and your score. And then do it again next week and so on and so forth. The game might take 6 or 8 or even 12 weeks to play out. During that time you would have been contacted on behalf of the game 3 times per week. Over an 8 week period, that's 24 points of contact.
Tim: Brilliant! But were millions of people really there?
Jerry: The biggest game that we did was in 1998, where we had 546,000 people registered for it.
Tim: Sure, by then you were beginning to scale.
Jerry: There were both high sides and low sides. What traffic there was online was easy to get in those days. The audience was very trusting and very open. They would click on almost anything and do almost anything you asked them to do. But the magic thing to me about what Seth had conceived was that it was based on something I knew a great deal about. At Wunderman we called it "Curriculum Marketing". Curriculum Marketing is the application of a learning discipline - just like a curriculum in a classroom - to a subject. In a classroom, the curriculum depends on two things. It depends on reaching the same person frequently and being able to change the message over time. Right?
Tim: Give me an example.
Jerry: Think about the way you learn French or Latin. If on your first day in Latin class, they give you the final exam, you're toast. That's not the way school works. You start off with the basics like, "Here is what a noun is, here is what a verb is, etc..." And each step along the way you're building on everything that came before. Because we know what you know, we know what we've taught you. And we can even test you along the way. My contribution to Seth was the application of this game concept that he was playing with to this direct marketing concept that we at Wunderman had been playing for about 6 years. Our problem with the idea as direct marketers, was that it was too bloody expensive to execute, because it required US Postal Service!
Jerry: Actually on our first T-shirt from Yoyodyne, we said, "It's like direct mail with free stamps...and no paper."
Tim: That is fabulous.
Jerry: And, the outcome of that intellectual ping-pong game was that I left the record business and went to work with Seth. We changed the name of the company from Yoyodyne Entertainment to Yoyodyne. And we positioned ourselves as a custom marketing promotion firm. We did these amazing sorts of things. One of the first things was a promotion for the American Express Online Travel site, which I think was called Express Net.
Tim: Let me ask you this, where does the name Yoyodyne? What's the significance of that?
Jerry: Seth is a brilliant guy and is an owner of a lot of obscure knowledge. He was a fan of a sci-fi film called, Buckaroo Banzai. In it there was a toy company called Yoyodyne that was out to take over the world. There was a rumor that all of the rocketry components on the Starship Enterprise was powered by Yoyodyne technology. Go figure, I don't know!
Tim: LOL! That's definitely future driven!
Jerry: Out of that we created a marketing plan which involved, mostly PR, because we didn't have any money and it involved, getting Seth and me on public platforms, to talk about this concept. Eventually, we were able to hone the idea into 2 words and he then wrote a book about it, called "Permission Marketing".
Tim: Wow! That was the bible in our business.
Jerry: We created those words and a series of presentations about permission marketing and what the power of permission marketing was. And we did a lot of really interesting, exciting and fun things. And two and half years later Yahoo! bought us.
Tim: How big was Yoyodyne?
Jerry: Before we became part of Yahoo!, we had just gotten into the black; about 6 million dollars of revenue. We had about 40 people. In those crazy days we thought we would be able to go public; but Wall Street perceived us as an agency model. We were doing customized promotions and that didn't scale. We had to continually hire more people to grow. We weren't doing something like software, where we could do it once and then keep selling it forever.
Tim: Give me an example of one of your promotions.
Jerry: We did a lot of games. One of my favorite was something we did for KPMG. They came to us and said, " Gosh, we go on college campuses to recruit accountants and so does everybody else. We're all guys in grey suits sitting behind tables with grey draperies in interviewing rooms, one right next to the other. How do we gain an unfair advantage in that process? How do we pre-screen the people who are coming in for interview so that we know who we really want to hire and they know that they really want to work for us?"
Tim: Right. How did you do that?
Jerry: We created a game, in which, to win you had to really, essentially, study the KPMG website. By doing so, you learned what their perspective on the business was. You learned how they were organized, you learned how they saw themselves as being better/different than anybody else and you either liked it or didn't like it. And, we got that against a very narrow audience, graduating seniors in accounting. And the prize we offered was a simple one, it was a spring break vacation with 9 of your closest friends. The way we promoted the game to attract players was to hang posters in the offices of each university's accounting department. We didn't need to run TV ads or print or anything like that. The posters cost like 50cents a piece!
Tim: Tell me about having Yahoo! buy Yoyodyne.
Jerry: The buying part was really interesting. Yahoo! was funded by Softbank. Yoyodyne had funding from a firm called Flat Iron Partners, with whom Softbank had an investment. In essence, the two companies you might say were related by marriage. When Seth and I realized that we were never going to take the company out and go public with it, it became clear that we needed to be acquired. We came to the conclusion that the best acquirer would be someone who had a lot of traffic. The analogy I used was that we were gas stations and needed to be acquired by Saudi Arabia!!