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Terrible Use of Groupon…

August 19, 2010 | Neal | No comment

Groupon Launches National Deal With Gap, Selling 10 Groupons A Second

When is a success not a success? When you’re giving away money to make it happen.  Now, I’m not faulting Groupon for leveraging their platform to do what it is supposed to do – create a viral coupon for a retailer. That part went exactly to play.  The part that I object to is Gap essentially giving money away using the Groupon platform.  If you think for a minute about what you usually see on Groupon, it makes sense.  Individual city offers are generally small to mid-sized local businesses who are hoping that the inducement of a coupon will inspire people to try their product or service for the first time in one of two situations:

  • The customer has heard about the product or service and knows that they have some “buzz” in the area but they’ve never gotten around to trying it for themselves.  The hope is that the Groupon is the thing that gets them in the door the first time and then, for some percentage of those first timers, creates on-going relationships;
  • The customer has never heard about the product or service but is generally in-market for that category of product or service and is willing to try something different because they’re getting a deal and, based on the Groupon statistics that they can see, others are joining them so they don’t feel like they’re the only ones taking something of a leap;

The common thread between those two situations is that in both cases the retailer using Groupon is hoping for greater brand recognition and a boost in the number of people who are trying out their product or service for the first time.  That brings us back to Gap.  Does The Gap really believe that there are so many people who are unaware of their brand and products? Is there actually anyone out there who has never purchased anything from Gap and doesn’t have a pretty good sense of whether it is for them or not?

If we suppose that there isn’t a gigantic market of people ignorant of Gap that I don’t know about then according to this article, Gap has spent $17.5 million with Groupon to give out 50% off coupons which I’m pretty sure Gap could have done by more traditional means for much less money. 

The lesson here is the following: Giving away money will always draw a crowd, if you already have the channels to get the message to that crowd, don’t pay others to do it for you.  If you DON’T have the channel to get to a larger audience and tell them about the fact that you’re giving away money (via discounts) then it’s a great idea to pay someone to do it for you.


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Devices Companies Should Consider

August 11, 2010 | Neal | No comment

Amazon Looks Beyond Kindle: 4 Devices to Consider – Yahoo! News

In this article, PC World writer Liane Cassavoy speculates on a few devices that Amazon should consider developing to better leverage their position as the online retailer of choice for so many forms of media.  While I don’t agree with all of the suggestions…

  • An Amazon phone seems like a bad idea in a market where phones are used for so much more than Amazon is known for;
  • An Amazon MP3 player seems like an even worse idea since MP3 players are pretty much a commodity at this point and anything music service-centric can be taken care of by an app on an existing phone;
  • An Amazon tablet could work as an extension of the Kindle line but getting to the next generation of Kindle is hardly an earth-shattering revelation; and
  • An Amazon TV could really be cool – I’ve often wondered why more companies haven’t tried to enter this market either solo or as part of a partnership since it has remained largely unchanged while so much has changed around it but Amazon co-branding a TV with built-in linkages to Amazon on-demand and for-purchase media of all types plus some sort of cloud solution for storage would get me interested;

…I really like the game of “who is missing out on a big opportunity” by not creating one or more products to compliment or extent their primary service.  Here are a few suggestions of my own…

LinkedIn Phone. You could probably insert Facebook for LinkedIn here but in either case, I’m stunned that neither social networking giant has made the move to being an operating system for a communication device.  I just makes so much sense that the place I go online to stay in touch with my friends and/or business contacts (and where they could easily keep their information up to date) would be the same place that I’d go to contact them when I’m away from a desk/laptop.

Airline-branded Luggage.  Not exactly a fit for the original techno-centric theme of the linked article but how is it that airlines struggling for revenue have failed to either develop or co-brand their own lines of carry-on luggage that they then certify for use in their overhead compartments?  With increasing restrictions on what goes above our seats and serious fees for anything checked, the sales pitch seems like it would be an easy one.  Throw in potential promotions like “we’ll discount any luggage check-in fees if you’re using our luggage on our airline” and there is another potential way to tie customers to a loyalty program.  Even better, there is very little work involved in actually executing this sort of program as a co-branding scheme.

Apple Car Stereo.  They’re getting closer as most new cars at least have options integrating iPods/iPhones with the car’s stereo and navigation system via a USB connection but having just shopped for cars, I certainly would have been interested in an option that featured something up to Apple’s design standards that really integrated the iPhone/iPod experience into my driving experience with all of the usability and design capability that Apple could focus on that task.  Honestly, this is really the last place that they don’t have a serious play in our lives so I’m not sure why it wouldn’t be next.

[Insert Name of Health Insurance Provider] SecurID (or similar authentication device). With health care costs spiraling out of control and reform measures about to drive costs up even further it seems like it is time to start taking costs out of the health care system and this starts with finding a way to protect patient privacy while gaining broader access to medical records, administrative/insurance records, customer service, and authorizations.  It might be that an actual device is unnecessary in favor of virtual multi-factor authentication but insurance companies need to start thinking pretty deeply about how they’re going to make virtual care and streamlined processes work.  This seems like an obvious start.

I’m sure there are plenty of other interesting ideas out there but these are the ones that are currently bothering me when I have time to ponder why certain things don’t yet exist despite the fact that they’d likely be home runs.

Any other thoughts out there?

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Groupon Clones Coming Out Of The Woodwork

August 5, 2010 | Neal | No comment

First came Groupon and Living Social (and probably a bunch of other independents) and now come the followers including OpenTable and Yelp.  Both of the social media staples are adding their own group discount schemes on top of their core online reservations and social ratings businesses respectively.  All of this points to what should be a pretty obvious fact – the only competitive advantage that exists with this business model is having an audience.  There is nothing proprietary about HOW Groupon or Living Social or any of the others do what they do.  Since they were first to market, they have big audiences but this isn’t a difficult technology to replicate and if they’re smart, they’ll start selling the capability to media companies everywhere as a service rather than trying to remain an independent entity.  Think about it, the things you need to be successful with this model are the following:

  • an audience,
  • a sales force and/or an easy online way for advertisers to create their deals; and
  • some fairly simple technology infrastructure

That’s it, that’s the list.  You have to assume that Yahoo, Google, Microsoft, Facebook, the Yellow Pages, Gannett, Disney/ABC/ESPN, Viacom, BiLo, Amazon, Priceline, Orbitz, Best Buy, Home Depot, and any number of other media and eCommerce companies have everything needed to replicate this model and I’m sure it will happen soon.  So, as Groupon or Living Social, why wouldn’t you announce an enterprise version of your capability or quickly create a partnership strategy with major media properties in your local markets rather than waiting for them to just reverse engineer their own solutions?  It’s really the only way any of these pure-plays is going to survive.  Certainly it would be easier for these media companies to buy this sort of solution rather than developing their own but we know they’ll develop their own if their other option is to continue to lose out on advertising revenue to another wave of digital sources.

Just something to think about on a random Thursday in an otherwise slow August.


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Yet Another Entry Into TV Distribution

June 15, 2010 | Neal | No comment

ESPN Coming To Xbox: Will Offer Over 3,500 Live Events, Free For Gold Members

It looks like ESPN and Microsoft are teaming up to bring you ESPN3.com (formerly ESPN360) via your XBOX platform.  My big question on this is what value gaming platforms really provide over time.  As their makers push more and more functionality into them, are they really just becoming set-top boxes? Are they substitutes for desktop PCs?  I’m not sure what the viability is of an XBOX console is over and above a desktop with all of the same media input and storage devices (and the occasional special controller for game play).  I can get games on my PC, I can get ESPN3 (and other TV/movie content) on my PC, I can interact with other game players on my PC, I can play BlueRay DVDs on my PC, and well, you get the idea.  What can’t I do nearly as well on my XBOX/PlayStation?  Type… Bring it with me (at least in the case of a tricked out laptop)… Work… etc. 

I’m sure there is a price point line of reasoning that says, that an XBOX as an entertainment-only device in a household with multiple people who need to be productive/entertained isn’t a bad economic deal over buying a second or third full computer but that price point difference is dropping. 

What does it all mean? To me it means that this isn’t a bad idea for Microsoft to offer as much stuff as possible with XBOX as long as it is a relevant platform.  Likewise, I think it is great for ESPN to have as many channels to its audience as possible – especially since ESPN3.com generally covers secondary events that don’t make the grade for the main ESPN channels.  If XBOX is another way to feature things like Mountain West Football, Coca-Cola Championship soccer matches, and Cricket competitions, then it is worth it for ESPN to get every dime possible out of those properties.  I AM curious to know what the financial arrangement is – does ESPN get money per XBOX Live subscriber like they would from a cable company? Is it somehow related to that user actually choosing ESPN content somehow? Ultimately though, in the long run, I don’t think this means that much because I don’t think XBOX (or PlayStation or Wii) are too much longer for this world.  There’s just no reason to continue paying for so many systems when the content/games that they provide can be delivered more efficiently and effectively from one.


How Frequently Should You Be Engaging?

June 15, 2010 | Neal | No comment

It’s been a little while since I’ve had time to post to the blog but I wanted to get a quick note out between World Cup matches and all of the work that I have piled up.  I saw this on the ViTrue site and liked the research they’ve done here on engaging with communities.  Below are the three charts that they published.  After the graphic, I’ll include a few of my thoughts on what this means for not only Facebook communities but community management in general…

CommunityStats

The real lesson here should come as no surprise to anyone.  The lesson is that people are going to engage more with you the more you engage with them.  If you put out effort, it will be returned.  Here are a few thoughts as to why this is true.

First, the obvious and we’ll do it with some World Cup flair since it is that time.  The old saying goes “you can’t score if you don’t shoot” and the same is true for engaging with potential fans or “likers” or whatever we are calling people on Facebook these days.  Think for a minute about how you might “go viral” on Facebook.  People who have already connected to you see what you’ve posted and they decide to take action on it or not.  If they do take action then their friends will see that action and recognize you as a “vouched for” brand/organization and are much more likely to comment/like as a result.  The more times per day you create that opportunity to engage the more likely you are to catch someone who already “likes” you when they are paying attention.  That makes them more likely to respond (because they actually saw what you said) and that in turn makes it more likely that that person’s network sees their response.

The second reason behind this is that the more you engage the more you reinforce the notion that people engaging with you on Facebook are part of something vital.   Consistent posting on the part of a community manager or leader will yield more comments, likes and member posts which will create a virtuous circle that will lead to more and more activity.

Don’t get me wrong, regardless of what this research shows, if you post random stuff just to post, you’ll fall on the wrong side of these statistics.  If you do a good job of posting high quality content frequently, you’ll be well on your way to proving to your audience that you are committed to building something valuable.  Audiences take note of things like that and will choose to give you their attention.  If you post uninteresting stuff and/or post only sporadically, they’ll be much less likely to be interested.


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The Evolving Relationship Between Celebrities and Products

May 28, 2010 | Neal | 2 comments

This article by one of my favorite business writers/reporters Darren Rovell (ex-of ESPN and now of MSNBC) got me thinking about the evolution of the relationship between celebrity endorsers and the products that they endorse.  It used to be that there were two main purposes to paying (usually a lot of money) to a celebrity endorser.  The first and primary reason for paying a celebrity was to associate your brand with the personal brand of that celebrity.  Michael Jordon associated Nike with winning, competitiveness, and a fashion “look” acceptable to male sports fans.  Martha Stewart tried to take KMart upscale to a new demographic of shoppers.  John Madden gave Miller Lite credentials as a legitimate choice for the everyman football fan who would previously not have considered a light beer to be acceptable.  You get the idea.  The second reason for paying a celebrity was to help create an entertaining advertisement that would capture peoples’ attention in a way that advertisements featuring no-names wouldn’t.  If you’re a fan of Michael Jordan already, you might give that Nike, Gatorade, or McDonalds commercial a chance to grab your attention whereas without him you might be off flipping channels, starting a conversation, or headed to the kitchen for a snack before your show comes back on.  Let’s state this first, neither of these is a bad reason to bring on a celebrity endorser (assuming that there’s a good fit).

The interesting evolution is that many of these celebrities now have their own direct channel(s) to those who follow them and no longer depend only on media outlets or paid advertisements to connect with their fans.  Oprah and Ashton Kutcher (along with CNN) staged the war to 1,000,000 Twitter followers a couple of years back and athletes, musicians, and entertainers have seen the benefits of creating a direct channel with fans.  Like any other brand, if they keep up an interesting conversation with their fans they won’t have to worry about a reporter twisting an interview quote into something sensational because they in essence become their own reporter (or at least the direct employer of the person writing the status updates, blog entries, and Tweets).  At this point, there are many celebrity-owned social media properties have exceptional reach.  Ashton Kutcher’s Twitter following has grown close to 5,000,000 people.  Tennis champion Serena Williams has over 1.5 million followers on Twitter.  Again, you get the idea.

Now, let’s think for a moment about the products that these people endorse.  Ashton Kutcher is the face of Nikon’s CoolPix line of digital cameras.  I’m sure they’re paying him a lot of money to be in those ads and even more money for those ads to be placed on the sorts of high-profile shows that will attract a) the type of people who will identify with Mr. Kutcher; and b) have the money to buy a digital camera.  At the same time, a quick scan of Twitter and Facebook show us that Nikon is leaving a fantastic opportunity on the table, those 5 million Twitter followers who have already indicated that they identify with Ashton Kutcher.  I didn’t do a comprehensive scan but I went back about a month on Ashton Kutcher’s FB and Twitter activity and there is nothing related to his association with Nikon/CoolPix.  No contests, no mention of his using one as part of the copious number of photos he’s posted (which appear to be taken mostly with his phone), no discussion of events, no promotions or deals targeted to the fans of the product’s pitchman.  Did I mention that NikonUSA’s Twitter feed has fewer than 10,000 followers? AND no reflected glory from the relationship that Nikon is paying for with Twitter star Kutcher.  All of this got me to thinking about the criteria that a product company SHOULD have as it engages with a celebrity endorser:

  • Reach – Before engaging with the celebrity, how are they evaluating the reach that the celebrity will bring directly with fans (Serena Williams reaches 1.6 Million fans on Twitter while soccer superstar Cristiano Ronaldo reaches fewer than 100,000);
  • Activity – How active is the celebrity (or their organization) on those direct channels?
  • Alignment – What activities is the celebrity willing to take on behalf of the brand/product they are sponsoring? Most seem to Tweet or update FB status ONLY when they are actually doing something related to that brand – filming an ad, designing/approving a product, etc. – would they be willing to step up to be more active in promoting the product with contests, offers, etc.?
  • Cross-promotion – How much reTweeting of each others’ feeds will the brand and celebrity be willing to engage in?  Great opportunity for the brand to do the work and then take advantage of the celebrity’s reach.

Being a celebrity is fundamentally different than it used to be and that is all down to technology.  If brands and product companies are going to get full benefit from the money they are already paying to celebrity endorsers, they should be evaluating those relationships more carefully and planning not only for the traditional activities but the increasingly important social media component of them.


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The Blurring Line Between Mobile App and Web Site

May 27, 2010 | Neal | 1 comment

For those who like to kill time while on the go, this article is certainly welcome news.  I’m all for there being more ways to get to the content that traditionally showed up only on the TV and only once.  Here’s the question that this raised in my mind though…”with mobile devices becoming so much more capable, why would the model for me paying for (or not paying for) content be any different between my iPhone, iPad, laptop, and desktop?”

I definitely understand the difference between owning the content (paying to download from iTunes vs. watching it for free on Hulu.com or one of the network sites knowing that it will have ads interspersed in the experience).  What I don’t understand is why I would be willing to pay $10/month (or whatever other scheme they come up with) for streaming to a small screen on my mobile device vs. watching for free with Hulu.com/CBS.com/etc. on a larger screen on my home PC hooked into an HD monitor.  Throw in the new middle-ground between mobile screen and laptop screen, the iPad, and the consumer choice related to paying or not paying for mobile video gets even more complex for providers to figure out.

Would I be surprised if networks and services like Hulu eventually emulate the cable/satellite companies and go all the way to a subscription model? Not at all.  That would be the easiest way for them to rationalize pricing across platforms.  Everyone can decide if they buy “all you can eat” from sites like those or “pay as you go” on iTunes.  Ultimately though, it seems to me that as everyone is figuring it out it will be tough for anyone entering the subscription mobile space to get users to agree to pay for something on the small screen that they don’t have to pay for on a larger screen.


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Our Client, Warrior Gateway, In The Press

May 24, 2010 | Neal | 1 comment

It is always nice to see our names or our company getting major media mentions but as a service provider, it is even more gratifying when we see our clients getting press for their efforts.  This article discusses one of our favorite clients, Warrior Gateway and the great mission they have chosen to undertake.  This excerpt gives some sense of the mission of the Warrior Gateway project:

The site lets veterans, their families, friends and caretakers search for services based on an extensive range of categories, including geography, eligibility and even user ratings inspired by Yelp, a restaurant and shopping review site.

A veteran returning from Iraq could, for example, search for job-mentoring services within 100 miles of New York City and filter the results so that only the highest-rated services pop up.

A search for “PTSD,” for post-traumatic stress disorder, within 20 miles of Dallas will bring up the Dallas arm of the U.S. Army Wounded Warrior Program. The program’s profile on Warrior Gateway lists an address, a phone number and a short description and provides an option to comment on the service and rate it on a five-star system.

The Black Turtle Media team is proud to support the strategic, design, and web development needs of this project now and as it continues to grow.


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A Light at the End of the Tunnel for Media Companies

May 18, 2010 | Neal | 1 comment

And for once, it isn’t a train rushing toward them at full speed. This article from the AP indicates that there are some hopeful signs for print, TV, and online advertising in early 2010.  Now, whether this is just a correction after the economic disaster that was last year isn’t clear from the article.  When you read facts like…

April 22: The New York Times Co. says advertising revenue fell 6.1 percent from a year ago, the smallest decline since the third quarter of 2007. Company says print advertising trends in current quarter look even better.

…you could interpret them in two ways.

  1. Things are picking up or at the very least not declining as rapidly as before – we’re out of the death spiral and things are looking up! OR
  2. Things were SO bad between being in a declining industry and the economy sucking wind that there was nowhere to go but up with the economy in recovery BUT we’re still trending in the wrong direction even when we give good news so the outlook still isn’t great.

I’m personally of the opinion that while advertising can be a secondary element of the revenue mix for media companies, there is no model that makes it the dominant element in that mix going forward.  If you ask me – and people do from time-to-time since I do this for a living – there is a huge opportunity that not many people are talking about at the confluence of companies that aren’t traditionally media companies having to become more savvy about what it means to be a media company by creating on-going conversations based around high value add content and media companies that are struggling for revenue models and in possession of excess capacity and know-how in exactly that arena.

If you’ll permit me to digress for a moment, I’d like you to image the following scenario…

If you were a consumer electronics brand manager looking to create a constant conversation with a marketplace that you know is trending heavily towards Apple products in one category where they are spending a lot of money (portable media players like iPod/iPad) and towards a wide variety of vendors like LG, samsung, etc. in the other market likely to drive lots of revenue in the next few years (internet connected and 3D TVs).   As you think about your strategy, obviously the first thing you need is compelling products but with those in place, the next question is who is in the best position to engage your market in that constant conversation that can start to get your brand back heavily into the consideration set for those looking to make a purchase?  There is certainly a place for the big advertising firms when it comes to specific tasks like creating ads and the like but if the goal is now to engage an audience on a regular basis, shouldn’t you be tapping into the expertise of the industry that has been creating such conversations for years and years instead of looking at places like PR firms who are still learning this craft while adapting from a world of press releases and campaigns?  If a publication like Maxim is a great channel in which to place an ad, doesn’t it stand to reason that they would be an even better partner in creating and delivering your message? After all, their job is to create content so compelling that people are willing to pay for it on the newsstand.  When was the last time that your agency created anything that consumers were willing to pay for?

At Black Turtle Media, we believe in this premise.  Everyone on our leadership team has experience creating a value proposition directly for an audience be that audience interested in Sports, Entertainment, Cooking, Politics, or Diplomacy and World Affairs.  Our acquisition of MediaSphere in Pune, India further represents our belief in this philosophy.  MediaSphere was founded by a team that came directly from the editorial side of the largest media companies in India like The Times of India and Yahoo! India.  They own a number of their own publications as well as working directly for a wide variety of high profile clients.   The common theme in both our US and India operations is that our teams understand what it takes to build a credible narrative with an audience to get their attention.  From there, all that remains is to understand the actions that our clients want from having that attention and driving toward that action.  This has always been something of an invisible barrier between media companies and their sponsors but this barrier will need to fall if the statistics that we started this article off with are ever to be reversed.


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I Knew Things Were Bad For Media But…

May 17, 2010 | Neal | No comment

…I honestly never considered it in quite the way that is presented at the end of this article.  The majority of the article is a rehashing of what I think most of us know about the state of the news media.  Things like differentiating types of content and their place in the digital landscape:

  • Traditional Reporting of the Facts – it is redundant to have so many different accounts of the same facts and it isn’t likely a financially sustainable business to be in for more than one or two players;
  • Traditional Editorial (with Editors and Fact-checking and the like) – expensive but still has its place if the right business model can be struck because people will be willing to pay for quality;
  • Blogging – be it from actual amateurs or professional journalists with fewer restrictions (none of the editing/fact-checking) it is of uneven quality ranging from “just short of feature quality” to not very good at all;
  • Hyper-niche – there are many topics that never would have been covered in any depth before the advent of blogs because the barriers to publication and distribution were too high for an uncertain level of audience interest;

So after getting through all of that there was an extremely interesting chart that showed revenue per employee on an indexed scale.  It really hit home on how far things have gone downhill for the print media business.  Here’s the chart:

These distinctions are essential to the preservation of quality journalism. Many wondered why the Yahoos, Googles, Microsofts, where unable to setup news organizations despite their incommensurable wealth (to put things in perspective: Google spends five times more each year for its datacenters than the New York Times (NYSE: NYT) spends for its entire newsroom). Part of the reason is the return on such an investment. Financially speaking, the news business is not very appealing. See for yourself in this revenue per employee table.

Google being the 100 index :
Amazon:……………85
Microsoft:…………..53
News Corp:………..47
Yahoo:……………..40
Washington Post:…19
NYTimes:…………. 22
Gannett:……………13
McClatchy:…………10

Now granted, Google is a unique story from a revenue standpoint, but even Yahoo is crushing the big names in traditional media with the exception of News Corp whose performance probably owes more to its television properties than the print business.  Just a grim outlook if anyone is thinking that there will be a wave of investment in traditional media companies.  You have to think that the investments that WILL be made in media will be in ventures like Politico where there is a chance to start from a clean slate in establishing how (and in what volume) reporters and editors will do their job.  Just hard to envision the traditional publications ever really transforming themselves that way – from my experiences, there seem to be far too many habits, sacred cows, and assumptions for that to happen even as the financial picture gets worse and worse.


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