Stay on top of the news, sign up for our free newslettersAdvertising Age: 80 Years of Ideas
We Look at the Events, Brands and Trends That Have Shaped Marketing -- and the Ones Still to Come
Published: March 29, 2010When Ad Age published its first issue in 1930, the stock market had just tanked, and a Great Depression was only beginning. Consumer spending plunged 41% from 1929 to the Depression's 1933 nadir.
--> A problem for consumer marketing, media and advertising? Actually, a remarkable opportunity.Ad Age's first issue, from 1930.
In this report, we profile great brands that made their debuts in 1930 and went on to be market leaders: Fortune and Fisher-Price, Motorola and McCann Erickson, Twinkies and Tums. And in an accompanying timeline, we assemble 80 highlights from 80 years.
The past offers key lessons. First: There is never a bad time to launch a great product or company. (The biggest opportunities on the internet were born of or after the dot-com crash. Just ask Google and Facebook.)
Second: Failure is a cost of business. When Apple's first wireless device (1993's Newton) flopped, Ad Age noted, "The category may give a new twist to Newton's law: Products may be falling now, but the category is still poised to soar -- eventually. ... Smart money still is betting on long-term prospects for wireless portable communications devices." Apple came back with iPod (2001), iPhone (2007) and iPad (2010).
Third: The best marketers, media firms and agencies boast an outstanding ability to reinvent themselves and lead their changing markets decade after decade.
The best example is Procter & Gamble Co.; see our 1931, 1980 and 1994 entries. And just last week, P&G rightfully became the first corporation inducted into the American Advertising Federation's Advertising Hall of Fame.
Ad Age has covered the rise of new media -- again and again: Radio, which went from essentially zero to 55% household penetration in 12 years; TV (0.4% to 55% penetration in six years); cable (6% to 50% in 19 years); internet (broadband penetration soared from 1.7% to 54% in eight years).
We've tracked the emergence of new technologies: Refrigerators (from 15% household penetration to 50%-plus during the 1930s); wireless phones (a 22-year ride from 1983 debut to 50% household penetration). We've also witnessed how innovators can build remarkable businesses around emerging media and technologies. Cable? Ted Turner. Refrigerators? Birds Eye frozen foods. Computers? Bill Gates' and Paul Allen's Micro-Soft.
Ad Age's 12-page debut issue mentions some now-faded brands such as Saturday Evening Post and Plymouth cars.
But the issue also notes brands that are very much in the game today: Time, The New Yorker, Quaker Oats, Buick, NBC. And Gillette, which at the time was preparing to launch a new-and-improved razor and blade.
So what's new? Keep reading.
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Monday, March 29, 2010
Kinda comforting to know we've gone through all this before. Advertising Age Special Report: 80 Years of Ideas
Thursday, March 25, 2010
Quo vadis, Agency? From AdAge: Allstate Launches Portal to Gather Media-Buying Ideas
Stay on top of the news, sign up for our free newslettersAllstate Launches Portal to Gather Media-Buying Ideas
CMO Mark LaNeve Unveils Site to Maximize One of the Smallest Budgets in Insurance Industry
by Jennifer Rooney
Published: March 24, 2010NEW YORK (AdAge.com) -- Allstate is reaching out to media sellers, asking them to submit ideas on everything from product design and integrated marketing buys to digital strategies and leveraging consumer insights.
--> Senior VP-CMO Mark LaNeve, along with Allstate Chairman-President-CEO Tom Wilson and VP-Marketing Lisa Cochrane today introduced Allstateideaportal.com, a portal through which the insurance marketer is seeking ideas to help it find higher ground in a feverishly competitive category that competes largely on price. Mr. LaNeve -- accompanied by actor and Allstate spokesman Dennis Haysbert -- said the company will still work as usual with longtime agencies Leo Burnett and Starcom, and noted that the portal will now be the "central location" through which all media ideas are shared with Allstate and those agencies.Mark LaNeve
The goal is to help the marketer and its shops "see what we don't see by being so close to it," Mr. Wilson said to an assembled audience of media sellers. "Help us figure out how we stay above the noise level."
As if that wasn't enough enticement for media sellers hungry for new business in a recession, the Allstate executives said that they are open to changing up this year's media spending and allocation based on ideas that come through this portal. "The consumer is changing every single day. Bring us your ideas. The door is not closed for 2010," Ms. Cochrane said.
Ideas coming through the portal that are good enough will get funded, Mr. LaNeve promised. Spending on ideas that come through the portal would represent incremental media dollars, Ms. Cochrane said.
Competing on value
In the presentation, Mr. LaNeve, former top marketer at General Motors Corp. who joined the insurer last fall, articulated Allstate's brand strategy as one where it competes on value, not price. "We have a chance to reinvent this category, to truly be about protecting and restoring our customers' lives," he said. "That's where Allstate's going to live," he said, adding that he wants consumers to "think about Allstate first in this category."At the time of his hiring, Allstate was ranked "about average" by customers in consultant J.D. Powers and Associates' annual National Homeowners Insurance Study of 27 companies.
Some media sellers in attendance at today's presentation said Allstate's move in developing the portal represents the marketer trying to be as innovative, creative and consumer-focused as possible in a category not known for its innovation -- and to leverage a budget that is one of the smaller ones in the category.
According to WPP's Kantar Media, Allstate and State Farm each spent $178 million last year on auto-specific media, vs $477 million from Geico and $290 million from Progressive. Total spending by brands in 2008 for all insurance products, according to Kantar Media: Geico, $619 million; State Farm, $436 million; Allstate, $362 million; and Progressive, $293 million. Geico and Progressive are only auto insurers, while State Farm and Allstate spread their budgets to promote other products such as home, life, property/casualty, financial planning and business.
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Wow! Seems mobile "'net-all-you-can" plans are working! From FT.com: Data traffic outstrips mobile voice calls
Data traffic outstrips mobile voice calls
By Andrew Ward in Stockholm
Published: March 24 2010 23:21 | Last updated: March 24 2010 23:21
Data traffic has exceeded the volume of voice calls across the world’s wireless networks for the first time, highlighting the challenge facing mobile phone operators as they struggle to adapt to surging demand for mobile internet services.
The crossover occurred in December when 140,000 terabytes of data content, such as e-mails, music and video, was handled by mobile carriers, surpassing voice traffic, according to measurements by Ericsson, the world’s largest network equipment vendor.
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“This is a significant milestone with some 400m mobile broadband subscriptions now generating more data traffic than the voice traffic from the total 4.6bn mobile subscriptions around the world,” said Hans Vestberg, Ericsson chief executive.
Ericsson said global data traffic nearly tripled in each of the past two years and forecast that it would double annually during the next five years as more people sought mobile internet access via laptop computers and smartphones.
Ericsson highlighted social networking websites, such as Facebook, as one of the biggest sources of mobile data.
The rapid shift from voice to data is transforming the telecommunications landscape as operators scramble to maximise revenues from mobile internet services, while trying to stem decline in the voice revenues that still represent the biggest part of their business.
The surge in data traffic is also placing a strain on network capacity in some areas, causing deterioration in service quality as operators struggle to cope with the rising number of bandwidth-hungry mobile internet users.
Ericsson and its competitors, such as Nokia Siemens Networks, Alcatel-Lucent and Huawei, hope the capacity crunch will lead to increased spending on network infrastructure but operators are reluctant to invest until they work out how to squeeze more profit from data.
While mobile internet has provided an important new source of growth, data is yet to fully offset decline in voice revenues, amid fierce competition and pressure from regulators to lower call tariffs.
Operators are looking for ways to extract more value from data but have so far struggled to muscle in on the growing market for mobile internet applications such as music downloads.
Growth in non-SMS data revenue slowed from almost 40 per cent in 2007 to 25 per cent last year, according to Barclays Capital.
“The challenge for the operators moving all this data is that they haven’t yet worked out how to make money from it other than as raw data,” said Nick Jones, analyst at Gartner.
www.ft.com/telecomsCopyright The Financial Times Limited 2010. You may share using our article tools. Please don't cut articles from FT.com and redistribute by email or post to the web.
Maybe there is hope for the music business. From FT.com / Management - How to create a chart-topper
How to create a chart-topper
By Andrew Edgecliffe-Johnson
Published: March 24 2010 23:24 | Last updated: March 24 2010 23:24
There was dog food in the gift bags at this year’s Grammy Awards, and a dead man has just struck the biggest record deal in history. A decade after Napster began demolishing its profit margins, the music industry is still struggling to adjust to more straitened times. Its online missteps, from suing downloaders to letting Apple’s dominant iTunes store dictate pricing, are so well charted that few outsiders would look to the music business for case studies in how to market their products in the digital economy.
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Last year’s charts again spelled out record labels’ dependence on television talent show winners such as Susan Boyle and stars of a more lucrative era such as Michael Jackson, whose estate just signed a $200m-plus deal with Sony Music.
In the past year, however, two acts have emerged that are giving label executives hope that they have not lost the ability to break new talent, and that also offer broader lessons about the power of digital marketing.
Lady Gaga, signed to Universal Music, and Ke$ha, on Sony’s RCA Records label, are vying to be the heirs to a pop throne not yet vacated by Madonna, while firing up digital communities of fans in a way that was impossible 20 years ago.
There are differences between the aloof artistry of Stefani Germanotta, Lady Gaga’s real name, and the raunchy and boozy lyrics of Kesha Rose Sebert, but both have achieved global, digital fame thanks in large part to online word-of-mouth of which brand managers dream.
“Eight months ago no-one knew who this girl was. Now she’s the hottest star in the world,” says Barry Weiss, who last year signed Ke$ha, a 23-year-old who grew up in Nashville. “Ke$ha’s going to be this year’s Halloween dress-up [costume]. Last year it was Gaga. Ten years ago it was Britney [Spears]. That’s how big this feels.”
Music videos make a comeback
Long before the YouTube generation usurped the MTV generation, the music video had become known as a loss-making luxury. Now, thanks to the internet, the music video is coming back into its own.
Ke$ha’s “Tik Tok” and the elaborately produced video for OK Go’s “This Too Shall Pass” have become viral hits, with 11m and 9.5m views respectively on YouTube. The “official explicit version” of “Telephone”, Lady Gaga’s controversial nine-minute production, has notched up 22.6m views so far on Vevo, the site launched by Sony Music and Universal Music with YouTube to provide a premium destination for their videos.
According to Barry Weiss, such traffic drives revenues. “It’s penny rates, but the Ke$ha videos will make a lot of money on streams,” he says. Sales of her single got “a big bump” when iTunes featured “Tik Tok” as its free video of the week, he says, but Ke$ha fans have also paid for 100,000 video downloads on Apple’s online store.
Mr Weiss, who runs Sony’s RCA/Jive label group, has watched Ke$ha’s debut single, “Tik Tok”, top the US charts for nine weeks. She has sold 6m iTunes downloads in the US and 2m internationally, and about 1m mobile ringtones and ringbacks round the world. Her debut album, Animal, has sold 1m copies, a “staggering” 50 per cent of them in digital form, says Mr Weiss.
Ke$ha’s appeal is to a hard-partying young crowd more interested in their smartphones than the CDs of Boyle’s older market. As Mr Weiss put it: “18-22-year-old girls and women are getting on the bar in Milwaukee when “Tik Tok” comes on. This is their song.”
Ke$ha came to RCA through Lukasz Gottwalk, or Dr Luke, the pop producer who gave her a break providing vocals for a 2009 hit called “Right Round” by Flo Rida. When RCA began negotiating for a multi-album deal, it was struck by her strong social media following. Once the label had settled on “Tik Tok” as Ke$ha’s first single, it gave it away from July on MySpace as a free stream more than a month before it was due to go on sale on iTunes.
For Mr Weiss, such viral marketing felt familiar. “It was the Britney playbook from 1998-99,” he explains. At that time, the Jive label had been dominated by rap artists but when Spears began her career, Mr Weiss says they “applied street marketing methodology to pop music” by giving out cassette singles of “Baby One More Time” as a young Britney toured shopping malls.
After spreading virally, “Tik Tok” hit iTunes on August 25. Within a week, it had sold 610,000 downloads in the US alone, breaking digital records for a female artist, and soon spread. “We knew “Tik Tok” would be an enormous hit when it broke at number one on iTunes New Zealand with no radio play,” says Mr Weiss.
Radio stations closely watch iTunes, which has sold 10bn songs to date, and calls poured in to Sony from stations round the world, but their interest prompted Mr Weiss to delay his radio launch plans by a month, to mid-October.
Even now, “radio is still the only way you really sell a record”, says Mr Weiss, but his gamble was to heighten the song’s radio impact by letting awareness build online.
Finance executives eager for a hit for the Christmas quarter questioned the decision, and Mr Weiss admits that, when “Tik Tok” was eventually released to stations, “it didn’t explode as the promo guys thought it would”.
The radio play was enough to pave the way for an album release in early January.
“January is dead. There’s no way we would have had the number one album [in the run-up to Christmas]. It would have got lost in the sauce,” admits Mr Weiss.
Other artists, from Lily Allen to Jack Johnson have had viral digital success, but “too often you see their [digital] phenomena pop up and there’s no foresight into how to catch that in a sales net,” says Bill Werde, editorial director of Billboard, the entertainment industry magazine.
In Ke$ha’s case, ”the brilliant part” was Sony’s decision to make her album available for pre-sale on iTunes just after Christmas, when new iPod and iPhone owners want to load up their presents with music or spend iTunes gift cards. “They played it perfectly,” Mr Werde says, ”but it helps that “Tik Tok” is an amazing song.”
Animal instantly bumped Boyle’s record off the top of the US chart and sold 152,000 copies in a week.
Unusually, at a time when many worry whether the album format can survive in the digital era, almost three-quarters of Animal’s sales were via iTunes.
Sony priced the album at just $6.99, before raising the price to $9.99 once it saw the pace of sales. “$7 gets kids interested in the artist, so ultimately [she] can have a 10-year career,” Mr Weiss says.
With fans able to buy only their favourite tracks, however, digital albums help point labels to their next single. At the end of Animal’s first week on iTunes, Sony could see that a track called “Blah Blah Blah” was selling almost as well as “Tik Tok”.
“That picked the single for us,” says Mr Weiss.
Ke$ha is now busily promoting her album, with events ranging from a “secret show” in London sponsored by MySpace to performing on American Idol.
Mr Weiss is already calculating how his new digital phenomenon will compare to Spears, a star from the cassette era. “Britney went on to sell 20m [copies of her first album]. We’re not going to do that . . . But we’re going to do 5m in America alone and we’ll probably do 8m-10m worldwide.”
A decade ago Jive made $60m-$75m from Spears’s first album, he estimates. “On Ke$ha hopefully we’ll make $15m-$20m.”
Mr Weiss’s father, Hyman “Hy” Weiss, founded a 1950s doo-wop label. “The business hasn’t changed since my father’s day. It has, but it hasn’t,” he says. “One hit used to cover 10 misses. Now it only covers one.”
Even with such digital success stories, the industry is still a long way from its profitable peak. “You can still make money in the music business with hit content. You’re just not going to make the money you used to make.”
Copyright The Financial Times Limited 2010. You may share using our article tools. Please don't cut articles from FT.com and redistribute by email or post to the web.
Tuesday, March 23, 2010
Where would we be online w/o @? From The NYT: Why @ Is Held in Such High Design Esteem
NEW YORK — The French and Italians have nicknamed it the “snail.” The Norwegians have plumped for “pig’s tail,” the Germans “monkey’s tail,” and the Chinese “little mouse.” The Russians think of it as a dog, and the Finns as a slumbering cat.
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It’s the @ symbol on the computer keyboard, which is an essential component of every e-mail address. Millions of us type it each day, usually without thinking about it. Yet the Museum of Modern Art in New York has deemed it to be such an important example of design that the @ has been officially admitted to its architecture and design collection. That’s as good as it gets in the design world, rather like bagging a Tony on Broadway or an Oscar in Hollywood.
You may be wondering why a keyboard symbol should be lauded as a design coup. It’s a reasonable question, and the answer tells us a great deal about how design and our expectations of it are changing.
Let’s start by looking at the @. No one knows for sure when it first appeared. One suggestion is that it dates to the sixth or seventh century when it was adopted as an abbreviation of “ad,” the Latin word for “at” or “toward.” (The scribes of the day are said to have saved time by merging two letters and curling the stroke of the “d” around the “a.”) Another theory is that it was introduced in 16th-century Venice as shorthand for the “amphora,” a measuring device used by local tradesmen.
Whatever its origins, the @ appeared on the keyboard of the first typewriter, the American Underwood, in 1885 and was used, mostly in accounting documents, as shorthand for “at the rate of.” It remained an obscure keyboard character until 1971 when an American programmer, Raymond Tomlinson, added it to the address of the first e-mail message to be sent from one computer to another.
At the time, he was working for Bolt, Beranek & Newman, a technology company that was developing a communications network for the U.S. Department of Defense. Mr. Tomlinson was responsible for the messaging service. He wrote the addresses in computer code, which needed to be translated into a form of words that the rest of us could understand.
Having decided that the first half of the address should identify the user and the second the computer, he looked for a symbol to indicate that he or she was literally “at” that machine. The @ not only had a similar meaning, but was so seldom used that it was open to reinterpretation. (If you’re a “Gossip Girl” fan, think of it as Little J. being crowned “queen” of Constance; or, if you prefer “Mad Men,” as Peggy after her promotion from secretary to copywriter.)
We all know what happened next. The @ became a supernova of the digital age and part of our daily lives, although that still doesn’t explain why it has been elevated to MoMA’s design collection.
There are some 175,000 pieces in MoMA’s entire collection, and roughly 28,000 in the architecture and design section, which includes everything from some of the 20th century’s most famous cars and chairs to the archive of the modernist grandee Mies van der Rohe. New pieces can only be added after winning the approval of an acquisitions committee composed of 25 architecture and design specialists, who meet every three or four months.
The committee must be convinced that each addition meets the entry criteria. Does it excel in terms of form and function? Does it embody the values of clarity, honesty and simplicity that MoMA considers essential to good design? Has it has made an impact on our lives? Is it innovative? Then there’s the clincher. “If this object had never been designed or manufactured, would the world miss out?” said Paola Antonelli, senior curator of architecture and design at MoMA. “Even just a bit?”
How did the @ fare? Brilliantly, according to Ms. Antonelli. By giving that once obscure accountancy symbol a new application without distorting its original meaning, Mr. Tomlinson was deemed to have checked all of MoMA’s boxes in terms of form, function, values, cultural impact and innovation. She sees “snail,” “pig’s tail” and its other nicknames as proof of its importance, because we care so much about the @ that we’ve started to mythologize it.
Fair enough, you might say, but what does its transformation have to do with design? After all, the new @ looks exactly the same as the old symbol, and isn’t a physical object like the chairs, cars or architectural drawings that you’d expect to find in a design museum.
That’s exactly why MoMA admires it. First, both the old and new @ fulfill the same function of simplifying and clarifying something that’s fiendishly complicated to make and interpret: handwritten script and computer code respectively. Ms. Antonelli describes that as “an act of design of extraordinary elegance and economy.” Both qualities are prized by MoMA, especially “economy” in a time of recession and environmental crisis, when reinventing something that’s under-used seems much smarter than designing something new.
Timeliness matters to MoMA too, and the new @ is timely not only in its economy but also precisely because it is not physical (just like equally dynamic areas of contemporary design such as software and social design). “MoMA’s collection has always been in touch with its time,” Ms. Antonelli said, “and design these days is often an act with aesthetic and ethical consequences, not necessarily a physical object.”
That’s why MoMA decided against adding a specific version of the @ to the collection in favor of using it in different typographic styles and sizes. Ms. Antonelli likens it to the museum’s acquisition of “The Kiss,” a performance art piece by Tino Sehgal, in which a couple embrace for several hours. Just like the @, each performance can take a different form with new protagonists — though there is a difference. MoMA reportedly paid $70,000 for “The Kiss,” while the @ is joining the collection free.
Recommend Next Article in Arts (14 of 19) » A version of this article appeared in print on March 22, 2010, in The International Herald Tribune.
Sunday, March 21, 2010
Been a Guy Kawasaki fan since picking up Selling the Dream years back. Here's a great NYT piece on him.
Q. At what point in your career did you first become somebody’s boss?
A. I was probably 28 or 29 years old and in the jewelry business. I started my career counting diamonds and schlepping gold jewelry around the world. The jewelry business is a very, very tough business — tougher than the computer business. You truly have to understand how to take care of your customers.
I learned a very valuable lesson: how to sell. Sales is everything. As long as you’re making sales, you’re still in the game. That lesson has stuck with me throughout my career.
Q. So how did the transition into management go?
A. When I was getting my education, I fell in love with the writings of Peter Drucker. He was my hero. I had a naïve belief that when I became a manager, it was going to be like Peter Drucker’s books. That is, I was going to be the effective executive. I was going to talk to people about their goals. I was going to help them actualize.
My thinking was: I’m a natural leader, so I’m going to study what’s hard and mathematical like finance and operations research, not the touchy-feely stuff that would be easy.
When I finally got a management position, I found out how hard it is to lead and manage people. The warm, fuzzy stuff is hard. The quantitative stuff is easy — you either don’t do much of this as a manager or you have people working for you to do it.
Maybe it was just my education, but much of education is backwards. You study all the hard stuff, and then you find out in the real world that you don’t use it. As long as you can use an HP 12 calculator or a spreadsheet, you have the finance knowledge that you need for most management positions. I should have taken organizational behavior and social psychology — and maybe abnormal psychology, come to think of it.
Q. So how did you learn to do it?
A. First, over time, you develop some knowledge and expertise in managing and leading — in many cases because you’re forced to.
Second, you learn to put in a cushion between you and the front line. You should hire people who are better at doing things than you are. So, in my case, I was not the warm-and-fuzzy manager, so I tried to hire people who reported to me who were warm-and-fuzzy types to provide a buffer. If you can’t do it, you should find somebody who can.
Q. Tell me about the best bosses you worked for.
A. My boss in the jewelry business was great because he taught me how to sell and how a business reputation was built on trust.
My boss at Apple was a guy named Mike Murray, who was the director of marketing of the Macintosh division. He gave me so much rope that I could hang myself and sometimes I did. After a while, your neck gets stronger and you also learn not to hang yourself.
A few levels above me, I learned from Steve Jobs that people can change the world. Maybe we didn’t get 95 percent market share, but we did make the world a better place. I learned from Steve that some things need to be believed to be seen. These are powerful lessons — very different from saying we just want to eke out an existence and keep our heads down.
Q. So how do you create a sense of mission in a company?
A. The foundation is the desire to make meaning in the world — to make the world a better place. We believed in the Mac division that we were making the world a better place by making people more creative and productive. Google, at its core, probably believes it’s making the world a better place by democratizing information. So it starts from this core of how you make meaning, which translates into some kind of physical product or service that actually delivers.
Q. How do you hire?
A. The most important thing is that you hire people who complement you and are better than you in specific areas. Good people hire people better than themselves. So A players hire A+ players. But others hire below their skills to make themselves look good. So B players hire C players. C players hire D players, etc.
Time and again in Silicon Valley, two engineers who are the founders of a company have a very unique perspective. They believe that engineering is hard, and everything else is easy. Sales, marketing, finance, operations, manufacturing — all that is easy.
With this perspective, they think that if they set their mind to it, they could be the best V.P. of manufacturing, best V.P. of finance, best V.P. of marketing, best V.P. of sales, best V.P. of everything.
However, in a perfect world, someone who is a truly great engineer and founder would appreciate the difficulty of marketing, and hire a marketing person who is far better than he or she is.
In a perfect world, you would take pride in the fact that you hired someone who is better than you. Hardly anybody has that attitude, though.
The second ideal goal would be to make yourself dispensable — what greater accomplishment is there than the organization running well without you? It means you picked great people, prepared them and inspired them. And if executives did this, the world would be a better place.
Q. Talk more about this notion of dispensability.
A. Insecure people would rather see the company fail without them than succeed. It’s because their ego is so large that the thought of a company succeeding without them is incomprehensible. They would rather see it fail.
Q. Other thoughts on hiring?
A. A major issue is with how interviews are conducted. There’s a body of research that says you should conduct first- and second-round interviews by phone, not in person.
This is because when you interview in person, many variables come into play that have nothing to do with competence. So is the person good-looking or not? Is the person dressed appropriately or not? Lots of factors can sidetrack you. There should also be a checklist of questions that you ask every candidate on the phone instead.
Another issue is that most people believe they are good interviewers, and that they are good judges of character. They’re wrong. That’s why you see clones of the boss in some companies: everybody is white, tall and from an East Coast private school.
Q. What should business schools teach more of, or less of?
A. They should teach students how to communicate in five-sentence e-mails and with 10-slide PowerPoint presentations. If they just taught every student that, American business would be much better off.
Q. Why?
A. Because no one wants to read “War and Peace” e-mails. Who has the time? Ditto with 60 PowerPoint slides for a one-hour meeting.
What you learn in school is the opposite of what happens in the real world. In school, you’re always worried about minimums. You have to reach 20 pages or you have to have so many slides or whatever. Then you get out in the real world and you think, “I have to have a minimum of 20 pages and 50 slides.”
Q. And what would you say to business school graduates?
A. It’s a more general lesson, but in the end, success in business comes from the willingness to grind it out. It’s not because of the brilliant idea. It’s because you are willing to work hard. That’s the key to my success.
Q. What’s your best career advice for somebody who’s just graduating from college?
A. Most people who graduate from college think they have to make a perfect choice. Is it Goldman Sachs? Is it Google? Is it Apple? They think that their first job is going to determine their career, if not their life.
Looking back, that’s absolutely incorrect. By definition you cannot make a mistake in your first job other than becoming a consultant or an investment banker.
Let’s say you land in a start-up, and it becomes the next Google. Now you’re 25 years old, and you’re worth $50 million. Anybody would call that a success.
But let’s say you join a start-up, and it implodes. You would learn more about leadership inside a company that crashes than you would inside the next Google.
Specifically, you will learn what not to do. You can’t make a mistake as a college graduate.
Q. Why did you carve out investment banking and consulting?
A. With investment banking, you make a lot of money, and you get a distorted feeling of how wonderful you are. You’ll be flying around in corporate jets and you’ll be attending board meetings, but you don’t really add value.
The issue with consulting is that if you go straight to work for a consultant, you develop this perspective that the hard part is the analysis and the decision. In reality, that’s not the hard part. The hard part is implementing the decision, not making it.
So the problem with consulting is you get paid $400 an hour, you do your beautiful charts, you make your PowerPoint presentation, you tell the client what they should do, and you go on to the next project. Meanwhile, you’re building up this belief that you’re a genius: you know how to analyze; you know how to make a decision; and, worst of all, you know how to implement — but all without implementing.
You can develop an absolutely incorrect perception of yourself as a great manager when, in fact, you haven’t implemented anything. You haven’t fired anybody. You haven’t introduced a product. You haven’t supported a customer. All you’ve done is make spreadsheets and PowerPoint presentations.
You can also throw venture capital into this pile. Going into venture capital straight out of school is a big mistake because entrepreneurs start sucking up to you and ask you stuff you know nothing about — like how to run a company.
Jobs for college graduates should make them gain knowledge in at least one of these three areas: how to make something, how to sell something or how to support something.
Saturday, March 20, 2010
Saturday, March 13, 2010
Mobile Coupons Hit The Target. From GigaOM: Are Mobile Coupons Finally Ready for Prime Time?
Smartphone owners are more interested in receiving coupons on their handsets than getting other kinds of mobile come-ons, according to figures released today by Compete.com. It’s just the latest evidence that while mobile advertising as a whole is slowly gaining traction, mobile coupons may be about to take off in a big way.
Compete found that grocery coupons were the most attractive of 10 types of mobile marketing ploys, with 36 percent of U.S. smartphone owners saying there were interested in receiving the discount offers on their handsets. Twenty-nine percent said they wanted to scan barcodes with their phones, while only 15 percent were interested in receiving text message ads.
Interestingly, Compete’s findings come just days after the launch of what may be the nation’s biggest mobile-coupon campaign: Target this week began delivering mobile coupons that can be scanned at the retail counter. Consumers can visit the retailer’s mobile web site or text the word COUPONS to the short code 827438 (TARGET) to opt in and receive a link to a mobile web page containing multiple offers accessible through a single barcode.
Mobile coupons have been around for the better part of a decade but have failed to really take off thanks to a lack of widespread retail support and a user experience that is often intolerable. The market is positioned to pick up some serious momentum in the next few years, though, according to a recent report from Juniper Research, which expects it to exceed 300 million people worldwide by 2014. That forecast might look modest if Target’s campaign gets legs and other nationwide retailers follow suit.
Related content from GigaOM Pro (sub req’d):
Why Google’s Favorite Places Will Push QR Codes Into the Mainstream
Image courtesy Flickr user Joe Pemberton.
Duh...as soon as retailers start doing it? From The NYT: When Will Location-Based Coupons Take Off?
How many times have you heard the prediction that one day, businesses like coffee shops will send us coupons on our mobile phones when we walk by?
That has long been the dream of mobile marketers. Still, only 9 percent of people have received a coupon or discount code on their phones based on where they were standing, according to new data from Compete, a Web analytics firm.
This could be the year that changes. People are increasingly interested in receiving coupons on their phones, especially at the grocery store, Compete found. On Wednesday, Target announced that it would start sending mobile coupons.
“There is a big gap between what smartphone owners are open and interested in receiving versus what they are currently receiving on their mobile device,” said Danielle Nohe, a director in Compete’s technology and entertainment group.
Thirty-six percent of consumers said they would like to receive mobile grocery coupons, 29 percent said they want cellphone apps that scan product barcodes for an offer or discount, and 26 percent want coupons from movie theaters.
But people are wary of bothersome mobile offers. Forty-one percent said they wanted to be able to get coupons on demand, or for their phones to store the coupons so they can access them when convenient.
“People don’t want to be bombarded with these,” Ms. Nohe said. “They don’t want it to be a nuisance.”
And they are much less interested in getting ads sent to their phones. Just 21 percent are interested in text message ads that arrive when they walk by a store. Only 18 percent want ads in free cellphone apps, and 16 percent want ads tied to mobile Web searches.
Mobile marketers are just one type of business trying to use cellphones to interact with customers when they are shopping in the offline world. Others include start-ups like Foursquare, Shopkick and Placecast, which recently started a mobile ad campaign with the North Face.
They are going after a big market. According to Compete, 74 percent of smartphone owners use their phones mostly for personal reasons, as opposed to work, and 53 percent use their phones while they shop.
Retailers turn the tables...er, aisles...on consumers. From TC: App Melds Check-In W/ Check-Out
Last night, we wrote about a CauseWorld teaming up with TechCrunch to provide double karma points during the SXSW festival starting today in Austin, Texas. These points, obtained through checking-in at various locations, can be used to donate to charities through big brands that support the app. It’s a great feature, and we hope you’ll use it in Austin. What we didn’t talk too much about is the app itself that enables it, CauseWorld, which just released a new version of its iPhone app in the App Store.
We first covered the app back in December, but now it has been significantly upgraded. One of the core ideas behind the app has always been the intersection of the mobile and physical world (something I’ve thought a lot about as well). A new feature bridges the gap a bit more as you can now scan barcodes on individual items with your iPhone to earn extra karma points. Proctor & Gamble are the ones sponsoring these points on different products they make. It’s a good idea, because even if you choose not to buy the item, it forces you to pick it up and look at it a bit.
This feature points to the bigger idea that CauseWorld parent Shopkick is thinking about when it is ready to launch its flagship product (CauseWorld was born as just a trial site of an idea, but quickly ballooned into an app with over 300,000 downloads). It’s the idea that the cellphone is the only interactive tool you carry in a non interactive setting at all times. So why not use it to make the physical retail space more interactive, Shopkick CEO Cyriac Roeding reasons.
Another huge addition to the CauseWorld app is a social layer. Previously, the app was all about what you did. But now you can hook it up to Facebook (which will earn you bonus karma points) and share the progress and donations you’re making with your friends. On top of this there are new features such as gifting which will help the app virally spread through social networks.
This social layer also allows for a leaderboard to be created showing which of your friend have donated the most karma points. Sometimes social pressure is the best way to get people motivated.
Again, CauseWorld stems from trying out an idea to see what would work with the larger Shopkick plan when that eventually launches. But the response to it has shown Roeding enough that he believes ”the next big thing after the check-in is the check-out.” Given the big brands they’re signing up to support CauseWorld, he just might be right.
You can find the new CauseWorld 1.5 in the App Store here. It’s a free download.
Company: shopkick Website: causeworld.com Launch Date: December, 2009
Website: shopkick.com Location: Palo Alto, California, United States Founded: June, 2009 Funding: $2.5M shopkick (previously Cross-Platform Corp.) was founded in June 2009 by Cyriac Roeding and Jeff Sellinger. shopkick bridges the… Learn More
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Monday, March 08, 2010
Again, why Digital OOH + Mobile will come together. from TC: The Rise Of Transactional Advertising
This guest post is authored by Alex Rampell
, the founder and CEO of TrialPay
. This is a follow on to an earlier article
“The End Of Brand Advertising,” where Rampell argues that the collision of online and offline advertising paradigms will have a profound impact on free content. Rampell’s most recent guest post for us was in the wake of the Scamville series: Tragedy Of The Social Gaming Commons: A Blueprint For Change
The marriage of brand advertising and free content is facing peremptory annulment. There is no shortage of punditry around “the death of the media company” and whether it is a just dessert or a societal travesty. But that’s looking at it from the media company and consumer viewpoint – what do advertisers think about all of this? Where is online advertising headed and what does that mean for free content?
Making content free was not a well thought out business model. Rather, before the days of Sirius XM and DirecTV, there was no more of a way to charge for freely accessible radio waves than there was to charge for air or sunshine. Making content free, and charging for advertising interspersed in that free content, was pretty much the ONLY business model back then.
And it worked pretty well, because supply (advertising “units”) was limited by the amount of content produced and, more importantly, by the narrow “channels” where such content was made available. With such low supply, high demand, and massive reach, it was easy to reach large swaths of the populace. The advertisers couldn’t really quantify their results, but they came up with a wide variety of methods to attempt to do so. Market research firms such as ACNielsen flourished to fill the need for “metrics.”
But, as I argued
in my last piece, brand advertising doesn’t really work – or, perhaps better put, is superseded by “transactional advertising.”
The old logic went like this — people were more likely to buy Coca-Cola versus Carbonated Dark-Colored Sugar Water X because Coca-Cola had a brand (which Coca-Cola has spent billions on). What’s the value of Coca-Cola’s brand? Pure math – it’s the Net Present Value (NPV) of the difference that consumers will pay for Coca-Cola versus, say, RC Cola, for the lifetime of the consumer and duration of the brand. When you pay $1 for a Coke versus $.50 for an RC Cola, the $.50 difference is chalked up to the “brand.” (Yes, perhaps there are differences in taste, too – but even with an identical formula and taste, I would argue RC Cola wouldn’t sell as well as Coke). Multiply $.50 times billions upon billions of cans of Coke, and you see the power of brand.
I don’t disagree with this notion, but I would argue that it is becoming largely irrelevant for a large class of goods and service providers (think soda or television set, not Rolex or BMW), and that the “brand” advertising money can be better spent, thereby imperiling expensively produced, freely distributed content. To wit: what if Walmart refused to stock Coca-Cola, instead stocking just RC Cola? Granted, Walmart stocks Coca-Cola because consumers demand it, and consumers demand it because of the brand that Coca-Cola has created, but that can easily be reversed. If Walmart decided to stock only RC Cola and expel Coca-Cola from its shelves, this would change RC Cola’s fortunes, and harm Coca-Cola, quite a bit.
Preferential placement of a good or service at/near the point of a transaction is something I call “transactional advertising,” which I predict will expand as a category in the coming years. Transactional advertising describes a clear food chain of brand and positioning; the titans at the top are Google, Amazon, Walmart, and other “aggregators” who themselves hold considerable brand equity and/or organic traffic. Smaller players exist in niche fields: BankRate, Shopping.com, Edmunds.com, Lending Tree, even Diapers.com have become destinations that steer consumer decisions. These have potential to be the new “media” companies in a transactional advertising universe, odd as that might sound.
This form of transactional advertising exists today, although you might not know it. Proctor & Gamble spends great effort and expense (though it pales in comparison to their brand advertising spend) to ensure eye-level placement wherever its products are sold. Many retailers “charge” for shelf-space, with the clear understanding that better merchandised goods have a better chance of ending up in consumers’ shopping carts.
Today you see very little in the way of transactional advertising online; rarely does one brand pop up in another brand’s checkout experience. There’s a good chance that will change in a major way in the near future. If old media companies can figure out how to attach themselves to more transactions, they have a fighting chance of sticking it out online.
Companies: TrialPay Alex Rampell is the co-founder and CEO of TrialPay, where he is responsible for general management and building corporate infrastructure. Prior to TrialPay, Alex co-founded FraudEliminator, the first consumer anti-phishing company, which merged into… Learn More
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