The Dark Art of Narconomics

Published: Aug 05, 2018

I value criminal minds. I hold the contention that criminals should be the thriftiest, most creative, quickest, and most flexible people, for at a moment’s notice things can go awry.

Tom Wainwright’s Narconomics: How to Run a Drug Cartel (2017), is an amazing book that I recommend all contrarian business leaders purchase. He expanded upon the likeness and similarities of cartels to more legitimate enterprises, discussing the marketing and promotion strategies of cartel businesses, outreach campaigns, their clients, customers and innovation.

narconomics - person smoke

In this review, I choose to focus on the criminal mind as it engages in business. I have condensed and synthesized some of the more important business, marketing, and promotion lessons from the book. Read and benefit from the lessons of the sharpest minds in the world.

Horizontal Diversification

Create different products for the same client or target market. Drug cartels are diversifying into other markets. This is because of the way the drug laws are changing around the world. Ever since Colorado legalized marijuana, we learn that this opening of the floodgates is disrupting the cartel’s business.

It is always important to keep your eye on what makes your business the most profitable but at the same time, keeping your eye on other opportunities to disperse and grow.

The Subtle Art of Re-Branding

Once marijuana was legalized, it expanded into other avenues and forms. You do not just have marijuana stokes anymore, you also have marijuana-infused chocolate, marijuana drinks, marijuana tablets, and weed cookies. There are also marijuana tours now in Denver that will walk you through the steps on how to smoke it properly, and in the best locations, so that you feel taken care of.

Finding ways to re-brand your product or service help market to different groups that would have never tried the drug otherwise. Dan Kennedy’s How to Make a Million with Your Ideas talks about this strategic and inventive way of re-purposing products and services. We also hear about “re-purposing content,” wherein you take something you have written and make slight changes before bringing it into another market.

Target Marketing

Go where you’re wanted and follow the money. Cartels map out their destinations in terms of the businesses that they occupy and where the money flows.

Cartels can also charge high amount. There are commodities that you sell that are absolutely divorced from the price it costs you to make those supplies. It costs literally pennies on the dollar to manufacture synthetics, but the margins are high. The profit is in the margins!

Organization

Gangs are now taking a more horizontal approach. They build franchises where you can access the logo, clothing, weapons, drug supplies, and most importantly, the fear factor and intimidation. Corporations do the same things that gangs do. They merge, they acquire, they create affiliate programs, like in network marketing (Kiyosaki, 2005), and they also create franchises.

Kiyosaki recommends joining a network marketing organization to learn how companies multiply their efforts with a clear system in place.   

The Supply-Chain

A product and service has a few steps to go to before it gets delivered to a customer for consumption. In the drug economy, the supply-chain is perhaps more fluid than most. Drug dealers need to be able to switch on a dime and go elsewhere to deliver their goods. This is another very vital lesson to learn. You should run your business as if you could go out of business any day because of the changing nature of laws and of society.

People keep tight controls over their supply chains and they minimize costs so that they aren’t delivering what the market isn’t prepared to pay for. In the same way that drug cartels minimize their runners to ensure the least possible resistance and issues with delivering the goods.

Resiliency

Cartels are incredibly resilient. We know this because as of Wainwright’s book. In fact, they were having a rather large existential crisis with the advent of The Silk Road, a formerly large network of buyers and sellers in the illegal drug market, mostly on the dark web which is available, as we learn from Narconomics, through a software called TOR, which allows you to search through websites without being tracked. In other words, it’s like Google Incognito, but it’s TOR.

Press and Promotion

Cartels contact reporters and tell them what they can and cannot report about. They also re-brand their drugs, change formulas, and deliver in different forms. They rephrase their stories. Seth Godin said that all marketers are story tellers while Dan Kennedy said that “all people in business are in marketing” (Kennedy, 1996).

Dan Kennedy also describes how he frequently compares apples to oranges in his marketing literature, how comparing something to something completely different often leads to insights and describes a service in interesting and new ways, with new insights, making it appear fresh and different. Cartels do this with their impression management strategies (Goffman, ) by appearing and being seen in some places over others, doing business in select countries and supplying different products–reaching out to select markets and then tapping into their language.

Cartels know the demand. They target it and then fill it. If it isn’t available to sell in one location, they will simply move ship and try another location, eliminating rivals along the way. They are fast, competitive, thrifty, inventive and creative. They manage their networks. These are all qualities worth fostering. And you can act just as fast.

You can work on being resilient instead of being tripped up by the obstacles that you encounter, the laws that do not work in your favor and the people that you can’t employ because they will not follow. Live with these complications, embrace them, for as the cartels have learned, they are your friends!

Alter your strategy and actions. Always.

Byron Katie in Loving What Is, says, instead of being torn down by the awful reality that your business is making no money, swallow your pride and ego, pivot and do the best that you can to play the cards you are dealt with. Nothing personal. You’re just working on your business and no one else’s.

Narconomics really is a dark art, if you think about it.

Works Cited:

  • Goffman, E. (2009). Stigma: Notes on the Management of Spoiled Identity. Touchstone.
  • Katie, B., & Mitchell, S. (2003). Loving What Is: Four Questions That Can Change Your Life. Potter/Ten Speed/Harmony/Rodale.
  • Kennedy, D. S. (1996). How to Make Millions with Your Ideas: An Entrepreneur’s Guide. Plume Books.
  • Kiyosaki, R. (2005). The Business School: For People Who Like Helping People. TechPress Inc.
  • Wainwright, T. (2016). Narconomics: How to Run a Drug Cartel. PublicAffairs.
This article is written by Todd Squitieri. Find out more about Todd from his website: www.toddsquitieri.com.

One thought on “The Dark Art of Narconomics

    seiji says:

    Interesting! Very well written too.

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