Steel industry magnate Andrew Carnegie was born into poverty but died one of America’s richest men. How did he do it?
Carnegie’s autobiography offers some excellent advice which is still useful in the age of internet marketing:
- “Always be on the lookout for opportunities, and when one arises, grab it.” The greatest earnings go to marketers who grab opportunities as they arrive.
- “The ability to memorize is a powerful tool.” It’s great to be able to find information by entering a search term in Google, but nothing can beat having marketing techniques memorized so you can apply them the moment you need them.
- “Exercise initiative by taking appropriate action in the absence of orders.” Great marketers avoid following “orders” from the market, instead choosing to create a new market for a new product or a new service.
Who was Andrew Carnegie?
Andrew Carnegie (1835-1919) is a true example of a rags-to-riches story. Born into a family living in half of a room in a weaver’s cottage in Scotland, Carnegie accumulated the inflation-adjusted equivalent of $309 billion—and gave all but $35 million of it away in his lifetime.
How did Carnegie progress from working 12 hours a day, six days a week, for $4.80 a month to reigning as the preeminent figure in American industry? Carnegie’s epic success can be summed up in six personal characteristics:
1. Intense desire
When Andrew Carnegie was a boy, his family lived in just half of a one-room cottage in Dunfermline, Scotland. This room also contained the loom on which they made cloth for their livelihood.
Carnegie’s father, however, was not content for them to spend their lives in poverty. He learned to weave damask, for which there was greater demand. This allowed the Carnegies to save enough money to make the voyage to America.
When Andrew was 13 his family moved to Allegheny, Pennsylvania. He soon got a job as a “bobbin boy” in a textile mill paying $1.20 a week for 72 hours of work.
This tough start in life gave Carnegie a burning desire to succeed and become rise out of poverty.
2. Attention to detail
Faithfully working 72 hours a week in the textile mill for two years, Carnegie eventually got a better job—for $2.50 a week—working as a telegraph delivery boy for the Ohio Telegraph Company in Pittsburgh, Pennsylvania.
Carnegie realized that he could improve his chances for success with his job by learning all the addresses of businesses in Pittsburgh and all the faces of important businessmen (businesswomen being a rarity in that era).
He paid such close attention to the dots and dashes of the telegraph so that he could memorize messages without taking time to write them down, saving time, and helping him make better connections with the people who could give him better work and access to money to build his first companies.
In the nineteenth century, Sunday was reserved for church. Saturday night was the only time to have fun. Rather than spending his money on drinking and dance halls, Carnegie took advantage of an offer from Colonel James Anderson to read the 400 books in his personal library for self-improvement.
4. Willingness to take risks.
By the age of 18, in 1853, Carnegie had found work as a secretary and telegraph operator for the Pennsylvania Railroad Company for a wage of $4.00 a week.
Railroads were the fasting growing industry in the United States at that time, and investing in railroads was making a new generation of millionaires. Carnegie so impressed one of the principal investors in the railroad, Thomas Scott, that Scott gave Carnegie $500 to invest in a company called Adams Express.
Carnegie’s new venture used couriers to deliver small packages (and messages along the Underground Railroad) throughout the northeastern United States.
Carnegie had to persuade his mother to take out a $500 mortgage against their $700 home to secure the investment, but the success of this first risky venture gave Carnegie many more opportunities to make vast sums of money with his railroad connections.
In 1864, Carnegie invested $40,000 in Story Farm on Oil Creek in Venango County, Pennsylvania. His driller struck oil, and within twelve months, the 25-year-old Carnegie had collected over $1 million in royalties and other payments.
This allowed him to buy his first steel mill at a time when demand for the metal for making railroad cars and railroad tracks was at its greatest. His empire grew until he became one of the wealthiest persons in American history, second only to John Rockefeller.
The rest, as we can tritely say, is history. Carnegie famously used his fortune to establish Carnegie Hall, and founded the Carnegie Corporation of New York, the Carnegie Endowment for International Peace, the Carnegie Hero Fund, the Carnegie Institution for Science, the Carnegie Trust for the Universities of Scotland, Carnegie Mellon University and the Carnegie Museums of Pittsburgh, as well as 2,509 libraries across the United States and the United Kingdom.
Lessons from Carnegie’s success
But what can you or I learn from the epic success of Andrew Carnegie? How can Carnegie’s story inform successful marketers in the twenty-first century?
- Connections can be more important than individual sales. In 2015, much of marketing occurs over the Internet and is driven by paid ads and SEO, but knowing a few customers who have money and who are willing to spend it may be much more important than appealing to search engines.
- Attention to—not obsession over—detail makes sales. Even when you are selling a simple product, attention to the details of your customer base can help you sell something else.
- Making sales and earning profits is essential to short-term success, but acquiring new customers and finding new products for their needs is essential to long-term success.
Even more essential to your success is focused, determined, goal-directed action. If you are reading this article, you may not have been as lucky as Andrew Carnegie. But if you take on Andrew Carnegie’s mindset, you will make your own luck.