Reality is Very Important

I know much of Advertising is Hype. Everything is elastic. Commercials take liberties with products and brands to prey on your emotions for good or bad. Best example is Multi-Vitamins. I take one everyday. Yet there have been countless studies showing no benefit.

I don't believe Facebook and Twitter's numbers. They are hollow. We all see tons of inactive accounts. Yet it seems both sites claim all user accounts are active each month. That's like me saying I feel great every day even when I don't. They benefit financially if they numbers are believed. I have a Finance Degree. I can work the numbers and I know they fib. Whatever. I can careless what they say as long as my clients and future investors know the truth.

So Twitter has 70 million accounts and only 50 million tweets per day. Facebook has 400 million accounts yet only 60 million updates per day. I know many people who update their status multiple times per day. Nowhere does either site state how many people are on the site per day!

The closest Facebook shows is time spent of 55 minutes per day. But we all know many of us are signed in all day long while only spending 10-20 minutes on the site. This evasiveness benefits the VC's and the Companies. It creates hype and belief in the product in hopes of going IPO. Once the IPO happens they won't care anymore unless they lose paper/equity/money when that event happens (very likely).

Now I see article after article and tweets galore that Apple has sold out of the first run of I Pads. But not one article has a number of units. Only one article gave an estimate of 500,000. If that is true its a home run of sorts for $250 mil gross. But don't forget they are sold online and through retail outlets so Apples take is much less than that. And I will bet the R&D investment was more than that. But definitely a good start. But what if it was just 100,000 units? That's only $50 mil in sales gross. Not as impressive. Actually a potential bomb. But if Apple get's people believing the highest number possible, they will invigorate the App Ecosystem to create Apps for the product. And Apple really needs to have 3-5 million units out there to have a big enough ecosystem for App Developers to have hopes of making good money.

So my point is real numbers are important. Reality is important. And beware when you read or hear anything that doesn't have concrete details.

Amazon vs the Publishers vs the I Pad vs the Others

I am a life long student of the business world. I try to base my views on what is right/ethical, in my view, vs what is best for one group within a business industry ecosystem. I also know that business is cut throat and if you can take more that is called profits. If you don't someone else will.

We all know this is kind of B.S. There are happy healthy mediums if you can get rid of ego's and entitlements. When a major technology breakthrough disrupts a whole industry ecosystem, the dead weight gets exposed and there is a long slow march to oblivion if they don't change and follow a new path.

I truly feel the emergence of the E-Readers and Tablet computing are great develops for the planet. Especially for the environment. If we didn't need to cut down trees for general paper use it would be a major boon to the health of this planets air, water, and land. But there is sizable infrastructure and jobs in the timber, paper, printing/publishing and transportation industries. Just for books and magazines! Prior to E-Readers these businesses were vital to the book and magazine industry. But soon they will be just extra cost that is not needed. Its the words, the content that has value and we buy. We aren't buying paper or timber, though currently they are part of the delivery system of we want to buy the content.

Amazon is fighting Publishers over the price of he E-Books. Amazon just agreed with one big house that new books will be sold for more and they get 70% of the sell price. And there is this major panic with Apple coming into the game to ensure the higher revenues. And here is where the Publishers are deceiving themselves. What is a fair price for a new book electronically vs hardcover. What percentage of the $22 to $25 hardcover price is the cost of timber, paper, printing, manufacturing? If it came in at $8 and that cost was gone tomorrow the industry would see Revenues drop 33% and they would panic. But in reality the value and revenue for the content, content development, and marketing are the only core costs, everything else is bloat. How it is delivered and consumed might constantly change over time. But the variable non-essential revenue sources should not be what is vital to an industry's view success.

The Convoluted Media Ecosystem

I have been thinking about this for quite a long time. My view point comes from several places. First is my Finance Degree and CFO view. Second is my many years in Sales/Business Development. Third is my new Advertising Career. Fourth is my view as a consumer. When it comes to Business Models Media is the hardest to be successful in because of all the competing special interests. It is almost like Politics. People love entertainment. They spend a lot of money on entertainment. And without the content the rest of the ecosystem is dead. We all love great content.

But to create great content and be profitable you need your revenues to exceed your costs. And the middlemen inflate the costs and your end user views of your content's value after all the middlemen add their take onto it. And there are parasites like Journalists and Media that use the content for monetary gain without being forced to Ad Value. But the parasites can often Ad more value to the content creator than the middlemen. And everyone wants to defend their business/revenues even if you don't have an inalienable right to exist. See I told you Convoluted.

One great example is the music industry as it was vs. how it is now. The old industry is crying because revenues are down. But consumers and the content creators are consuming and selling more than ever, just cutting out the old industry middlemen. Who is being cut out? Record Labels. Packaging Companies. Radio. Media like the Grammy's. Do we need them? Not really. When CD's cost $14 each the artist only got $1. $4.50 was for packaging. And a band with 4 members plus management if they sell 1 million units making them platinum only made $1 million to split between them all. A nice bit of change but won't make you rich.

But now I can create music. Promote it free online. Sell it myself. And tour and make as much money or more than when I had all the bloat.

What about TV-Cable? Similar situation. They create something but added onto the cost is the technology to send it (cable, internet), the technology to view/consume it (TV's, Sound Systems, Computers). The media that is used to promote it all.

And while Ads can help reduce the costs for the entities that make money off the Ads, the rest of the entities really don't care. TiVo and DVR OEM's do not care about Cable Channels needing Ad revenue, or Cable companies needing subscription revenue. Apple doesn't care that I-Tunes destroyed the CD packaging industry. Or the internet/social media destroying the Record Companies/Radio niche of promoting music. But the fact remains if the people who make the content can not make a profit, the whole ecosystem collapses.

So what really happens is the creators cut costs. That is why TV is filled with cheap reality shows vs stellar content. If we are only willing to pay enough to support crap we get crap. See You Tube! And sadly as sheep most people watch the crap, because they refuse to either not watch and find something else to do, or they have decided they will watch anything. But this does a big disservice to the content creators and artists who are forced to dumb down what they do just because we are all lazy and cheap.

Apple's first stumble with the IPad

Apple just released it's I Pad. I truly think they blew it here after all this hype. But how can it live up to the hype? Apple obviously wasn't reading any of the posts here or my posts to the Media Trade Journal Articles when it comes to readers and TV everywhere. Plus not only is the name hysterical since my esteemed sister said it was a bunch of men who came up with the name, Hitler was very disappointed. And I agree with his talking points.

Click for:

Hitler's Rebuttal

Over 700,000 people have seen this hilarious creation which highlights many sever limitations of the I Pad. In one fell swoop all the free marketing from Apple fans and Media/Advertising Industry Journalists and Pundits has been countered.

The Wi-Fi and 3G are great. The battery life incredible. But no Flash???? No Firefox?

This blog had suggested in the past the perfect "Insert Brand Here" Tablet Computer will have full HTML and Flash (or equal) with full web surfing and game playing because that is what people want. They want bigger screens for TV and Movies. I myself bring my laptop into my bed to watch DVD's because up close the screen is bigger than the 19" LCD HDTV across on my dresser. I would love a fix for this heavy, hot device from my lap.

And when an "Insert Brand Here" Tablet comes out with Flash(or equal) they will truly be a game changer. The I Pad is really just a large sized I Touch. And the only reason I can think Apple did this was to not have an APP Creator Revolt. Nothing like bragging about 125K Apps in your store front only to have them not work on the I Tab and crushing that whole ecosystem at once. But what Apple fails to realize in a HUGE way is that App ecosystem be damned other forms with no App Stores who can care less will gladly destroy this ecosystem. HP, Dell, Sony, Upstarts, all have no App Stores!

Interesting because in the past Apple was the company bringing creative destruction to industries. Now they might suffer the same.

In my next post I am going to address the print industry and where it went wrong and can it be saved.

Subtle Startegy, Network Greed or Poor Media Buying

We have observed this, we are watching a program on Cable or Network TV and we notice one or two commercials are repeated so often that we actually switch over while they play because we are sick of hearing the same message. I am currently watching a stand up comedian on Comedy Central. I have seen in 45 mins the same I Pod Touch commercial 6 times and an I Phone App commercial 4 times.

So is this strategy on someone's part? To ensure the message is beaten in my skull. So that I get brainwashed into buying the devices.

Or is this greed by Comedy Central? Apple gave them money for inventory to reach a certain demographic and they are light on clients for spots on this show so they just keep plugging Apple?

Or is this poor media planning? Where someone isn't paying attention or not critiquing the performance reports they get from Comedy Central when they come in?

I know media planning and buying for a major national brand across all platforms is as complicated as curing cancer. But Apple spent about 30% more than they should of on spots during this 1 hr program. And as a champion of the brand with a Finance/Sales background I call it wastage.

Behavorial Targeting, the Good, the Bad, and the Ugly

This post is aimed at Google, Facebook, Twitter, and all Ad Serving Networks.

My previous post discussed my search for a new laptop. One that will cost me between $650 and $900. So not a small sale. It is worth the various brands and retail outlets to observe me researching specifications and pricing. The specs I seek are for across the brands in terms of the hardware, so they are an equalizing factor. Since I seek to buy in the next 6 weeks the real impetus will be the best deal. I have a few models picked out that I am willing to buy and seek the best price, warranty, and any deals like free virus protection etc. I do have concerns about pre-loaded software. I want minimal. My Compaq that I bought in May 2008 came with too much stuff. Like MS Works..deleted. MS Office trial...deleted. MS Internet Explorer...deleted.

I want to take the BT from various view points. The retailers, Staples, Best Buy, Walmart, and Apple all observe me crawling around their websites. The Ad serving networks that have access to my surfing also could possibly see that I went to these sites (unsure if they see on the sites themselves). And if I post any information about my search on Twitter or Facebook, they have access to knowing I am searching. And of course Google owns this Blogging site!

What I want. I want the retailer to send me a pop up saying if I buy within the next 60 mins I get something. Free accessory. $50 off. Free shipping. Etc. And really that is it.

The retailers. Should want what I want. Try to make the sale right there immediately while I have items in my cart to look at pricing.

Those two are great benefits to BT.

Now the Ad Serving networks, Google, Facebook, and Twitter. It is in their best interest to offer Ads to be served by the Brands themselves to me in hopes of swaying me one way or another. But to do this they would have to serve me Ads at some point, somewhere. Obviously a retail site will bar this. Obviously if I have Firefox with Ad Blocker I won't see them anyway. But I am a very high value prospect. Meaning they could auction or sell Ads served to me to the brands at a high price. Now while I might be fine with 1 or 2 ads popping up, I would flip out if I was slammed because of BT. And that is the danger of BT.

Brands obviously want every single time someone is looking for such a big ticket item to be able to contact you. But if they all do, again I am slammed and upset.

Now get to the value of BT. Who gets the value? That depends. Will BT of Ad Serving help me find the best product at the best price? Or will the Ads bought by the highest bidder cloud out a best solution for me? If I can't see all my options then BT fails me.

And of course the only way to see best option is to work at it. To search via Bing or Google. Read all the Ads and Circulars. Visit stores. Ask friends. And make phone calls. In this case my work (and information found online) will pay off 80% of the effort to find best product/price. And Advertising will actually help since that is how the 'deals' reach me.

Big ticket behavorial shopping, Online, Offline...metrics?

I had an 18 month old Compaq Laptop just die...completely dead. So I have to shop for a new Laptop. Since I read all the Advertising Trade Journals about the various types of measuring success, ROI, 360 marketing, all the major marketing channels, this is a perfect case study to show how jacked up measuring ROI is. It will also prove the bias in various marketing channels will use to hype their portion of the sale.

First off HP is out. I spent $70 at staples to find out my motherboard is fried (after 18 months of mostly use for work!) and HP wants $315 for a new one. Not only do I flip them the bird, I refuse to buy from them now. Including most likely getting a new Printer for Business that is non-HP! See what customer service and honoring the product means? Plus I am slamming HP in my blog. Touche %#%@&^@%!&!'s.

I am looking at Dell's, Toshiba, Mac's (way too expensive! sigh), and Asus brands. I am comparing Staples, Best Buy, and Walmart (hate Walmart but saw they were trying to put best Buy out of business). I am researching online via the stores vs the actual brand sites. I am looking at pricing online and via the Sunday Circulars. I paid $100 for a 1 year warranty on the piece of crap Compaq I had (it was a great unit until it died!). I want 4GB RAM, Pentium Dual Core, 320GB HD minimum, 15" screen, and the best Warranty possible. Although there are other sellers of Laptops my concern is who can support the warranty. When I brought the Compaq I had bought at Best Buy in they told me since it is out of warranty it will cost $90 to look at and they send it out with a 2 week lead time just to call and tell me what is wrong! Boo Hiss!

In the last 2 weeks Staples, Best Buy, Apple and Walmart have observed me crawling around their sites, reading specifications, pricing, and customer reviews. I have a borrowed Think!Pad with Linux with no rush to buy today, but in a rush to buy before new years.

Now look at my vendors. Apple. Love them. Wish their laptops were a bit less expensive and I am still open to a refurbed model if I can find a deal via the Apple Store. Best Buy. Kind of upset about the Compaq Laptop support. But I like the company, the service, the selection. I will be calling to discuss the warranty support before buying. Staples. Did a good job looking at my laptop that died. Not a great selection. But they are right their in price and they do fix computers on site vs. sending them out.

Walmart. Loathe the company. I refuse to buy from a right wing business owner, who wraps themselves in Christ while treating employees and contract manufacturers as indentured servants. Biggest hypocrites on Earth. You would think they would pay their workers more than anyone, pay their suppliers properly and make sure no 3rd world slave labor is working in the factories, and they would give wrap around Healthcare to all, and make sure all communities with a Walmart benefit vs suffer because that is what Jesus would do. So no sales to Walmart. But I will use them for leverage if need be to get a better price. But they do have a great warranty and if it turns out the price saves a bundle I can consider them. The products I am buying are made in the same place no matter what retailer I go too anyway.

So when I do buy, how will the various marketing channels take credit for the sale? Obviously the heaviest impact is online. But since Best Buy has amazing details on their products, the actual Brand I buy can thank them for helping steer me to them. But in reality quality and service are important, not just specs. And what if on Sunday I see the circular and jump at a deal? Doesn't the Print folks get some credit for reaching me since I still get a daily paper? How much does my sale mean to the retail stores? $50? $100? $150?

Now lets look at Behavioral in my next post and why BT is good and bad.