The Future of Marketing

I’ve been thinking about the future of advertising & marketing lately sincem y boss is off to SXSW this week. I’ve found that in the last decade there is a new trend that takes over as the next-big-thing in online marketing every 2 years.

Before that, the TV/Radio/Print models lasted for about 50 years. I used to think that we were looking for the next big model/philosophy for advertising and things would settle into a steady pattern for the next 20 years but I am beginning to doubt that is going to be possible.

Either we’re still evolving or we’re going to always be evolving from now on. I don’t see any stopping in the development of new devices that use the internet nor the methods in how people use them.

This could prove exhausting for companies having to add another “expert” to their teams every year or so instead of making sure their staff has time to learn on the job, which they really should do. It also means that unless there is a new person or time to learn for companies, their effective advertising will become less effective every year they use it just because behavior is changing so rapidly.

A look at what is hot now and what has been popular in the last 10 years.

Facebook seemed to be the biggest advertising/marketing trend of the year in 2010 and companies I work with have jumped on the bandwagon in 2010-2011. I think this is definitely where people are online for a large chunk of their day, turning it into a communication channel for your company isn’t as easy as it looks. I’ve been on FB since they opened it to people with a company email address and I have been hesitant to share that much personal info with a public database like that but the general public seems to either keep it fluffy in content or not care. Ads on the site do generate interest, but at lower click through rates than any other ad medium I’ve seen.

Twitter has also become laser-hot in the last 2 years and has exploded because of celebrity use and the popularity explosion of smartphones on the US market. Direct P2P marketing is the main method if twitter use in my opinion, and they really don’t charge for it in any way. The downsides here are that your tweets are really only alive for 1 day and then they die, and are taken out of the searchable database if someone is not a subscriber.

Blogs have been all the rage for the last 2-4 years but people have backed off lately because content farms were really making them look bad, content is expensive/time consuming to produce and all the blog ad networks that provided a reliable income from it have either gone under or are paying less than 20% of what they used to or have no inventory. So even if you’re hosting for $10 per month and paying some person in india $5 per article you really can’t make the Google AdSense $ to cover it anymore, and there are few networks paying more than $0.25 per CPM. And since you’re less likley to get blog traffic via search these days you have to build a loyal following, and that is either long hours researching cutting edge news content/analysis or going out and shaking a lot of hands in person. Bloggers typically don’t like people all that much. Also, RSS push notifications were supposed to make Blogs portable to any reader anwhere and instead they just became geeky things body understood and nobody used. Bummer. WordPress (and earlier TypePad and Blogger) were the real catalysts here. They gave regular non-programming people the ability to publish anything they want on the web for free without programming a site or knowing HTML. It was revolutionary until we all remembered how hard the Newspaper business really is and how it is far too time consuming to be profitable. Real bloggers blog because they love it, not to make money. Blogs are also a great way to publish content for free if your business is content, that’s not going away anytime soon.

Blogs were super valuable when they were super influential for Search. Search engines were the marketing darling of 2004-2006 and have slid in ROI ever since. Google has made higher minimum bids a regular practice and people have become desensitized to ads. These super targeted ways of reaching people with relevance have also been taken over by giant companies that used them for branding rather than content relevance and watered down their effectiveness. People have also noticed the spam in search and trust Google results less knowing people work the system. Some blogs gained traction as content/news sources that people subscribed to instead of newspapers and propelled real people into the reporting limelight, the rest became archives of people’s personal lives or were spammy and forgotten. Some people will probably stay with search as their core online activity for the rest of their lives because it made such an impact, but others are moving on.

SEO has been the secret marketing tactic of the last 5 years and it has only lasted that long because it has been so hard to build links for SEO and figure out how the algorithm has changed. Lately though companies have been gaming it more than ever and there is too much knowledge on how to Google Bomb something and people know garbage results when they see them. So, there has been more trust transferred to social networks where people rely on their network of friends to filter the news and just pass on what is really meaningful. This method isn’t about discovery or archiving like search was, it is about instant feedback and the trust of the people you know. Bing has not gained much traction and with Google as the only worldwide player, they will continue to do what they want to maximize profits and favor big companies rather than work on the algorithm and better understanding how people want information. SEO will always be needed and always be challenging.

Email is the old skool way to do things online and time spent in email these days is dropping significantly. People have taken their communication with friends to FB & Twitter and we know how to read/process email a lot faster than we did years ago, so less time is needed. Yet it is still the main method of communication/task management for businesses because of the electronic paper trail it creates for projects/accountability. Real Spam, marketing spam, inbox “work” association and other instant means of communication over the years have tarnished Email’s image. That said, millions of people are still tied to their email as an official method of communication that can reach the most people because it has been around the longest.

Analytics is also a trend but in my opinion this has been the most consistent of all in the last 10 years. It is basically looking at and interpreting data from websites and advertising campaigns and making sense of them in a way to make positive changes in the media/ad choices and web content/development to better serve customer’s and the companies’ needs. I hope more analytics programs allow better/easier integration with all links/ads/impressions across the web because this is the key to understanding customers. There have not been many companies willing to get into this ginormous database product area over the years because it is so costly and complicated to get it right. The looming battle over cookies and privacy could change some of the validity of the data if it means that we lose 50% of the data on visitors. More disclosure is needed with consumers to get a better understanding of how these systems work in order to overcome this.

Display Advertising online is the unpopular element to talk about here but this type of ad had grown dramatically in the last decade. You may think back to old times when Gator or WeatherBug installed spyware on your computer from banners and wonder how it would grow. Well a lot has changed. Seriously. As soon as post impression conversion tracking was created we understood that people see and read banners even though they don’t usually click. Waiting for someone to click is pointless in banner advertising. If you track who views each ad (with a random ID number in a cookie) and then who converts and lands on the thank you for purchasing page that is all you need to know. In this space we’ve also seen advances in brhavioral targeting based on demographic data people share with networks (Like your Yahoo or Google profiles) and retargeting based on which sites you’ve visited in the past and may be interested in again. The end result is that Display advertising works, but only if you buy a lot of it. Like millions of impressions and you track from the impression through conversion and not just the click.

Some recent trends that have fizzled are:

Surveys/Customer sentiment measurement gauges. They’re more annoying than useful for the consumer, pretty much a waste of time even with some small incentive. Unless you pay someone $10-$20 they’re not going to care enough to tell you the truth. Nobody wants to say something negative that gets someone else’s job in trouble. If you pay attention to your feedback through customer service you will probably find out more useful information.

Feedback/Comments/Rating Systems. These are a good tool if you have an engaged customer base. I’ve seen some work well like Amazon and Nordstrom, but others like travel sites and restaurant ratings just get slurped into Google as content and your site doesn’t benefit from the functionality. People do trust ratings from customers (real people) more than ads or third party rating systems.

IM Instant Messenger. Some people still use IM as a method of chat, but it never became the hub for activity that we thought it would. AIM and Yahoo had it after ICQ and never really capitalized on it. GMail and Facebook added this as an additional functionality making the original IM programs kinda obsolete when people could do everything in one place.  Skype is the one standalone place this may live on. Skype’s claim to fame is video calls via internet and free voice over internet calls to anyone else online with Skype. Yahoo IM does this too but nobody really seems to use it there. Maybe they should have had that featured in their TV commercials.

Affiliate networks. These were all the rage in 2003-2004 and they have been a big reason for the prevalence of spam in blogs, social networks and search. Farming your online marketing out to people who are not responsible for the brand of your company and will do anything to make a buck is an invitation to get played. A lot of the payouts have dropped from these systems have been shut down or have less than 20% of the payout they once did for a conversion/lead. The message here, don’t trust anyone who says it’s “easy”. Some high level revenue sharing or lead trading relationships between large companies make sense but should always be handled in person by people not through 3rd party electronic networks.

Video may be a success for many people (including cats) but for most of us (and companies) it is still out of reach and vastly misunderstood. From a behavior standpoint, people can’t watch video/audio at work while at their desk because it is too noticeable that they’re not working (the largest audience base that the internet has) and the video content is not searchable because there is no transcription of the content automatically to make it searchable or translateable into different languages. Most people don’t know how to edit video and companies don’t want to pay thousands of dollars for this either. Editors may also have a tough job going through thousands of hours of content in the future to find the meaningful stuff. Professional content creators like TV/Movie studios still have the upperhand here in creating really good quality video and we may not have affordable tools and education for a while yet. Monetizing it is another problem and YouTube is an example of really popular sites not making enough money to really pay the bills since they rely on Google to subsidize them. I think Video may get easier if there are good online video editors (with good tutorials) that become available cheaply.

The Question & Answer format completed by volunteers/users of the site. Yahoo Answers is moderately successful from a search perspective but the general public never caught on and a lot of the answers were pretty bad. I never understood why companies never took advantage of answering questions as a way to create permanent links to their site for people looking for their products/solutions. Now Quora is trying to do the same thing somehow combined with Twitter. More companies seem to be embracing it but again the success of the site depends on the quality of the answers and without paying someone how good do you think it will be when the newness wears off?

Wikis. I wanted Wikis to be big. I am such a fan of Wikipedia and I also work in an industry where sharing content is a daily occurence. Wikis help when you need a reference material to be updateable quickly within a group. It served the encyclopedia niche really well and not many other companies needed something like this.

Now that I have rehashed the past and the present, where does that leave us on the footsteps of SXSW needing to understand what is next?  Some ideas I have may not be fully developed, but that is what the future is all about, speculating.

1. We need more databases, more user friendly-visually configurable-cheap-secure-web based databases. We have a lack of public knowledge about how to collect, maintain and report on multiple databases in marketing. This has only been for the IT and Web departments in the past, we need to free the data to become accessible to more people, although probably not everyone wants that. Some people may find that overwhelming and it does take experience to understand multiple layers of marketing and the effects it has on the data. We also need to find more user friendly ways to link separate database systems like analytics with accounting or orders and web ad servers. We need to resolve traffic flow/identity across all of them in order to understand things better, and we need more processing power to do this. It is also getting easier to collect data at so many points in everyone’s day on so many networks. We need ways to process all these potential new forms of data from wearable sensors to car/directional related sensors to all the video people post online that has no text for content. Basically we need to find better ways to process and understand all this data.

2. Mobile use is exploding but in my opinion very few web functions work well on phones due to the small screen and the variable network connectivity. Email works, Facebook also works. Twitter was made for phones. Advertising was not. How to monetize this channel is a challenge, as is how to reach new consumers in a relevant way while on these devices. One thing is clear, a mobile phone is with someone all the time, possibly even while they sleep, and people very loyal to their smartphones. The checkin-foursquare thing has caught on for some functions and some needs but it is not widely excepted. (more relevant to brick and mortar businesses offline) There is still frustration when full website functionality isn’t included in a mobile design and there is confusion between apps and mobile websites for consumers and marketers. This all may get resolved in time because of popularity. A Nielsen poll found that 41% of the respondents used their cell phone in the bathroom. We’re also not sure if tablet computers fit into this category or not yet. We will see more advertising opportunity on Mobile in the future but it should always be paired with regular Display & Search advertising (and offline) to make the connection.

3. Cloud computing, bye to VPNs and servers and hello to clouds. Also hello to more hacking, more data loss and more outsourcing of IT jobs to somewhere else. This can be a good technology to make your content/data/work available wherever you are.

4. QR codes, maybe? Eh? We get how to use them, not sure what the point is for the consumer? Coupons? Wireless rewards points systems? How do you get this data into your existing order and web analytics database systems?

5. Internet on TV and vice versa. The internet being an on demand database of content you can choose to watch at any time makes a programming schedule obsolete. Live events will have a certain lure but otherwise people will use Google TV, Apple TV, Netflix to access content while using the web in their living rooms all at the same time. Video chat will be better when its on your TV too. This will be very tricky for advertisers. In an on-demand world nobody will wait for a commercial anymore and it will have to be all subscription based. Companies will have to partner with content creators to get products seen, mentioned if there are no commercials.

6. Fragmentation. People may get tired of the constant need to reformulate their entire communication method with family/friends/work every two years and just pick something and stick with it at some point, but in the mean time we will have a lot of noise from a lot of signals all clamoring for a consumer’s attention and that means that they listen less to each of them. This makes marketers have to work harder to be louder and more frequent in their messaging and in turn makes consumers turn it off or change methods yet again. I find that to combat fragmentation you have to advertise on more mediums to be seen in more places. Billboards, Radio, Online & Mobile for example all at 4:30 pm advertising the evening news.

7. Task management - this is the factorization of web and white collar workers. Log into a closed system and a task list tells you what you have to do today and how long you have to do it. No critical thinking allowed without flexibility and more of a contractual-short term-task relationship with highly skilled workers. This could mean people work from home from anywhere, but forget the benefits of collaboration or connection with your job. It may improve productivity to a point, but at some point it is hard to motivate someone to do something as fast as possible when they’re not personally invested in the business (or getting rewarded that way) and working remotely.

8. Digital Archives - People are not able to really keep tabs on all the digital information in their lives. I feel this with digital photos. If Flickr didn’t exist with all my photos tagged and dated I wouldn’t be able to find anything with image names like DCIM21531 and file folders of random events on my computer that aren’t backed up. (ok that isn’t true, my tech husband just started an automated backup on an external drive he put away in a safe place, but until now it had never happened before). What about medical records for someone’s entire life history? What about family history? Emails, correspondence, daily diary blogs and other forms of electronic data? My brain can’t really remember everything and creating an archive to refer back to is an appealing idea. I also feel like I need a secure place to subscribe to in order to save/manage all this content and I’d pay for it gladly. Especially f they sent me a backup version of it on a drive in the mail. It also would serve as an archive for people if someone passes away.

9. Content managers – they used to be called Editors and paid a lot more money. Now they get paid to know the content subject matter and be an expert and may be responsible for writing the content themselves.

The Negatives of Social Networking Media

All the world is a Buzz about Facebook & Twitter these days. It’s almost like MySpace circa 2007, Google circa 2003 or Microsoft circa 1998. I don’t doubt the success, innovation or long-term viability of these social networking sites but I have seen that there are flaws in the system that mean that things won’t be perfect with the business along the way and we’re in for a bumpy road. Basically my point is that for all these sites give us in entertainment, social connections and opportunity they also have some negatives that are almost the equal and opposite pendulum action.

1. Time Suck – all social networking sites are using your time that you used to devote to other things. Maybe in some cases this is actually a better use of your time (instead of TV) but in most cases its time spent that you used to use for researching new information for work projects,  time actually spent talking with people in person (family/friends) or time spent doing things that really need to be done at work or home. Once the brain gets trained that you can go socialize instead of work at those times of day it’s a habit extremely hard to break. For all of us procrastinators looking for instant gratification its a real problem keeping up with work and affects the overall productivity of companies and the country as a whole. Internet access is much more prevalent and has far more users during the business day than it does at night, so there’s the proof. Unless your job is trolling these sites for sales prospects by “connecting” and making “relationships” with your customers, its a waste of time to spend more than 15 min a day.

2. Privacy – Of all the details analyzed about consumer privacy online (on Facebook) in the last few weeks the most suprising thing I’ve seen is that people really don’t care about their information online. Sure, nobody is going to post a ss number or cc number on their profile (duh) but they don’t really seem to realize the power of logging all their social interactions in one database and selling access to retailers and cpg companies who have even larger databases of information to analyze and strategize with. Is it really as fun when most of your friends are companies selling you things all the time? Twitter already has morphed into the largest opt in direct marketing platform I’ve ever seen. If people keep using it at this rate it will surpass email. The other obvious issues come with the work life balance thing and when people friend work makes and think nobody will see them rant about work or post drunk pictures on a sick day, but then again I’ve heard that its just people naturally selecting themselves out of the working pool.

3. Logic – the other issues I’ve seen coming for a while have to do with how everything that is built from large databases online with lots of consumer data seems to not work properly. There is always some algorithm developed by a science tech guy based on some theoretical calculus and it doesn’t provide relevant results. Which brings me to a repeating theme of data right now: we don’t really know what to do with it yet. Nobody knows enough real info about their customers to target them. (who has a budget for that?) And the database people just like to say they improved things a statistically insignificant amount with an algorithm tweak. The marketing strategy/process should always start with offline real life information about people and products and then develop an algorithm to show you information in that way. I don’t know why it’s always done backwards but it will keep our results irrelevant and marketing dollars wasted for a long time to come.

Government Income Taxes in History

income tax brackets rates through history united states USA

(click graph to see full size version) I was just looking at this really interesting infographic of the income tax rates for the United States over the last century or so. It is an interesting graph because it makes it very clear that the wealthiest people are paying the lowest taxes by percentage of any time in our country’s history. By contrast the low and middle class are paying the most they’re paid or close to the most. 

I’m not sure how the government got away with a 90% tax rate in any time period, but it sure looks like they did. As much as I think the wealthiest people need to pay more again, nobody deserves that.  It makes the 5-10% increase in taxes we need on the wealthy people making over 1 million a year now seem paltry and insignificant. 

According to the graph the yellow areas say that in the 50′s and 60′s if you made more than $10 million you gave 90% of it to the Government. Wow. (9 million?) That doesn’t really seem plausible although they tell a story about boxing matches being held only yearly for this reason. There has to be something between 90% and 35% though because these people are the cash cows of our country/economy and are the only ones that can actually pay for the fancy jet security and government health care. 

Also I found it interesting that in the early 90′s people making less than 10K had to go from 0% tax to 15%? That is a big loss for the part-time workers of the country and it happened just in time for me to start working at my first job. Someone making 9K would lose $1350 to taxes, a huge sum for someone who may be just scraping by. Previously in history this tax bracket was taxes between 10-20%, so it has been higher, but the logic seems difficult that the people who make the least are losing the least also. Maybe if more government programs like healthcare actually give back to this income bracket this will be a more justified expense.  

I am also surprised looking at the top income bracket at 50% through the 1980′s and it re-frames how to think about Ronald Regan’s presidency (known for cutting taxes), but seeing that he got a larger percentage of paychecks to finance things with during a time of de-regulation and government cuts, no-wonder he was able to make things work. I doubt he would have believed that the tax rates should go as low as they are today though seeing how much government is expected to provide. 

Seeing over time how high these income tax rates have been in order for the country to survive and knowing what people expect from government right now (more services), I think we will have to return to the previous income tax rates and raise business tax rates at the same time to make up the difference even in a good economy. We have a huge budget deficit, increasing costs and government loans that are ballooning (bonds that are declining in value). Things aren’t looking good. It’s all our civic duty to pay taxes and the country can’t survive without it.

How do you lower your cholesterol? With what foods?

I heard from my doctor on Monday that I have high cholesterol, it is 243 at the moment. The good cholesterol is at 71 and the bad is 146. Yikes! I am only 33 so this is a bit surprising. We really took the test on a whim, not expecting it to be that bad yet. Yes I have a family history of heart problems (my maternal grandmother died at 50 with a heart attack and my paternal grandmother died at 55 from a stroke) but I never knew it started this early.

I do feel like I have time to work on this, at my current age I can make changes now and hopefully reverse some of the issues. There are some suprises though that lead me to believe my genetics aren’t that great. Not only am I a lot younger than most people with this cholesterol score, I also don’t eat the things they say are causing it. I am not someone who eats red meat every night, cheese, whole milk, butter or eggs. I think there are some sneaky causes to high cholesterol though that may not be as straightforward as the advice they have given me.

The causes I think are:

1. I am completely sedentary. I get less than 1K steps a day because of my job and where I live. This isn’t really changeable which sucks.

2. I eat out a lot, because we work a lot and I am a pretty bad cook. I really don’t know how to make anything besides grilling it, boiling it or the nuke it in the microwave method. I also grossed myself out on healthy choice and lean cuisine frozen meals in the 1990s so I can’t really eat them anymore. So I need another option besides skim milk and fat free cereal for dinner.

3. Healthy food is expensive! And Complicated! Yuck, or it’s raw which isn’t that great. I really can’t afford salmon or a fancy salad every night. I have to look into some low fat/cholesterol options.

4. Carbs may play a role in this. Both because many carb-licious items have butter/iol/fat in them and because carbs get eventually turned into and stored as fat. I am a carb addict. I would much rather come home and eat a pile of pancakes or muffins than meat any day. But then again I’m polish and we do carbs like nobody else. (and I like the serotonin from them too)

5. I have to get reading labels again. Both with packaged groceries and in restaurants. Hmmm an iPhone would help with looking up nutritionals at restaurants. I really have been lax in looking into that and keeping track of what the heck I put in my mouth.

6. I am consistently surprised that I gain so much weight from just a few calories extra and how little I work off. I think part of the equation is also loosing weight, but I’m not morbidly obese either. I am bout 20 lbs heavier than I should be, which definitely needs to go since its a cholesterol making machine, but it’s not like I have done anything drastically bad yet and I’m already in trouble.

The man-foods we usually have at home that I am no longer allowed are:

1. Brats (duh, we’re mid-westerners and they are really cheap)

2. Pizza (again a cheap fast food with a huge amount of cheese and most of the time Steve also likes meat)

3. Bakery (sob!) I love any kind of baked goods and I just got a kitchen aid mix master for a wedding gift. Sigh… I have to do things like angel food cake (egg whites, no fat) and light bread and limit carbs generally.

4. Hamburgers (again cheap food that is freezer friendly and fast to make)

5. Ice Cream – I usually eat light ice cream and not all the time, but this is probably best left off limits.

6. Snacks – Granola bars are really formulated to taste like cookies and bakery these days, and they have the bad stuff to match. Candy of all kinds can’t be good either.

Why the Microsoft & Yahoo Search Deal Sucks

I blogged about why I thought that the Microsoft and Yahootalks were not going to yield anything useful last year and was satisfied that they stopped wasting time trying to buy each other out of financial trouble. Now it has been widely reported that Microsoft has gained access to Yahoo in a search partnership deal. This is somewhat better but again, the executives have not listened to the public.

1. This Yahoo-Microsoft deal still sucks for several reasons. One being that Microsoft Ad Center is the ad display engine being used in the partnership and not Yahoo’s Panama. Neither have the depth or ease of use of AdWords. Anyone who has ever placed any pay per click search ads in their life would choose Panama over Microsoft Ad Center as the system to use. Maybe MAC makes more money but there are too many limits on bids, keyword availability and restrictions on running your ads to make it widely accepted.

2. The recent Netflix prize showed how much collaboration benefits organizations rather than competition. The revenue share partnership deal usually shares no information about technology or business strategy at all between companies. Its a you win, I loose, I’ll just pay you for handling this for me-approach to solving a problem, that doesn’t work in the long term.

The Netflix prize was recently awarded when a group of individual competitors and small teams banded together to use all their ideas in combination to finally get above the 10% improvement mark in matching/suggestion technology and submit their top result. In the last day before the time was up, another group of researchers banded together and topped the previous best submission also by combining all their ideas together at once.

Then in the last 12 hours the first team did come back with another submission just slightly better,  to win,  but the overall idea/lesson is still the same. If you really want to improve on consumer products and experience with really complex technical problems like search and suggestions, you have to collaborate rather than compete.

Yahoo and Microsoft would do a whole lot better against Google if they got the Bing folks together with the Yahoo search folks and started collaborating on this daily via videocam rather than doing an affiliate marketing type deal. This deal is evidence that Microsoft is being run by the lowest common denominator these days (and loosing a lot of money that way) and Yahoo’s CEO won’t be around long. She has made a decision that helps her contain and cut costs of running her company in the short term and that decision has sacrificed the long term marketability of her product.

In fact Yahoo was a search company primarily. People only used email, Yahoo news and other functions like Yahoo Answers because of the search engine they knew. If you take that away you don’t have an identity as a company. And they will lose a lot more search market share and preference by outsourcing to Bing even if they get paid a little bit more profitably in the next 2 quarters. This is pretty much the death of Yahoo. It is really sad.

How GM should restructure for a Government Bailout and streamline Brands and Cars

How can GM save itself from Implosion? Which GM brands and cars should bekept and which should be cut?How many jobs can be saved in Detroit? Should GM, Ford and Chrysler be saved at all? Will the consumer demand for vehicles (cars) ever pick back up again? These are all good questions.

Everyone is all a buzz about the American Car companies and their pitch to the Government saying that “bankruptcy isn’t and option” so give us billions in free money that has no strings attached and we can spend on anything we want. Ouch! I think congress was right to send them packing the last time they showed up in private jets and asked for money, and we have learned that in the other bailouts, the banks aren’t spending their money on what it was “proposed” for so more oversight is needed for any government bailouts of companies.

Back to my thoughts on GM specifically, since I am not an expert on Ford or Chrysler.

GM has some opportunities to be successful in the future but much of that opportunity comes at the cost of getting rid of the past, completely and starting over from scratch.

Almost every GM car or truck sold in the last 10 years has been either: inferior in quality, reputation or design. They also tend to make cars for segments that people don’t need and then wonder why people won’t buy them even when pushed. (Hello: SUVs) I read yesterday that the 4 brands that GM intends to keep are Buick (yay!), Cadillac (ok), Chevy (a necessity) and GMC (WTF?). 

I think they should throw all the brands out and come out with 5 new ones with distinctive market segments and niche products. Here are the segments in automobiles that I think will be big in 10 years that GM or any car company needs to invest in, and cut everything else:

1. The new shiny reliable car below $8,999. Developing countries and low income people in developed nations will need this kind of transportation as the cost of transportation increases consistently. (think college kids and retail hourly wage workers) It isn’t sexy or cool or updated every year. It is a 5 year design of an extremely reliable and simple car and only available in 1 color and maybe with 2 seats. If people want variety they can customize on their own. These cars are cheap super basic transportation and low cost is what sells them and fuel efficiency is also important. They have to be more reliable than a used car or this won’t work. Think old VW Beetle, Geo Metro, India’s Tata, China’s Cherry Motors or simpler version of a Honda Civic/fit.

2. Super eco friendly green cars. This segment has a product range from cheap eco friendly basic cars to luxury eco friendly status comfort cars. Performance isn’t really a priority but style and design is. Comfort comes at a price but miles per gallon is always in the 50-75 mpg range for all vehicles. Leather heated seats is an option on the lux ones. Think Toyota Prius and GM Volt. A 5-door option is nice here too. Eco people are practical people. Plug in charging in your garage and solar panels in roof are also great pluses if the cost can still be comparable to a non-eco car. People need to have one of the eco cars start at $15,000.00. Then fancier ones can be higher priced. Pricing people out of the market is bad for business, you loose sales and customers to people who do have the affordable eco cars.

3. Business/Industrial/Delivery Trucks & Vans. No consumer needs a truck unless they live in the mountains of Colorado or live on a ranch, but telling people they needed huge over-sized utility vehicles for their family use has been a strategy used in the past 15 years to re-purpose existing designs to new markets. This era is over and the SUV needs to die except for people who have 5 kids. (relatively few) There is a continued opportunity to sell trucks to businesses that deliver, transport and create large products in the US but it is a far smaller division of the company and of sales. And living in the US and seeing firsthand how people use these vehicles for business should give GM an insight that the Japanese, Chinese and German car companies don’t have and lead to building and innovating better vehicles.

4. And most importantly: The everybody car. I think GM has no way of recapturing a significant part of the 4 door family sedan but there is an opportunity to innovate it. There have been a few cars that are appealing to everybody because they contain multiple category characteristics. (um, crossovers without the truck part plus luxury) The everybody car I am talking about is the 5 door hatchback sedan. Don’t think 1970′s! Think of the Prius and Saab 9-3 when it was a 5 door, think Subaru WRX. More needs to be done in developing practical sexy cars like this because they take over where SUVs left off. You can haul things in them and get good fuel economy at the same time. You can even structure them for performance and luxury and fuel economy at the same time. So, the 5-door sport/luxury/green/family sedan is the everybody car of the future. Will GM make it and market it properly? (it could be the volt if they lux it up a bit)

5. The Luxury Performance car. Lastly, GM needs a super-car or luxury flagship vehicle that basically walks on water and inspires a generation. (more than the Pontiac solstice) These cars aren’t always profitable themselves, but they make the other brands you own more profitable and can make your brand one that people believe in. How Toyota and Honda don’t have one I don’t know, but maybe that is why they do so much racing now?  The Corvette makes Chevy feel cool, the R8 made Audi sought after. Vipers dying off made Chrysler seem even less cool and less reliable. Plus so few people will be able to afford a luxury performance car in the future that this will need to be a niche business with limited production.

And for fun here is what I think of the brands GM currently has:

Keeping Buick: Buick makes an extremely reliable car (yes like Honda/Toyota reliable) so this is a good place to start and they get 25-30 MPG. What Buick needs is a few smaller car options and even better fuel economy without sacrificing the comfort, luxury and quality that people need and love. They do need a new logo though, that doesn’t look like the 3 old 80′s shields.

Keeping Cadillac: Caddy is all about Flagship dream cars and it may share a few parts with Buick so there are manufacturing cost efficiencies there.  Caddy needs to keep innovating on performance, style and (surprise) eco materials and fuel economy.

Keeping Chevrolet: Chevy has been the all American fleet of everything (soup-to-nuts) vehicles for a long time. Many of the other brands aren’t needed because Chevy offers most everything. They cover work trucks, family sedans, performance cars with the Vette and with the Volt an eco car of the future. They should make them less fugly though, because they aren’t selling against other lux GM brands anymore, they are selling against Toyota and Honda’s flagship cars. 

Keeping GMC: Wouldn’t it have better to just sell trucks under one brand as Chevrolet since we need so few trucks? I am at a loss on this one. GMC offers nothing new, interesting or innovative at all. (yuck)

Cutting Saturn: Apparently this is just Opel cars from Europe now.  The Saturn brand name needs to die since it means cheap, flimsy, crappy, cars that break down a lot and are ugly. Re-release Opels under the Opel name? How about Vauxhall in the US? We like them.

Cutting Pontiac: Well Pontiac has been loosing it’s battle to streamline its designs and be a sleeker performance division of GM because of it’s cheap finishes and lack of quality. Plus the dealers don’t really help here either when they don’t look like a performance dealership. I think the concept of performance only exists at the same time with luxury because who will pay all that money and not want to be comfortable in their car? And quality in finishes and reliability is ultra important. As Pontiac is now, it should be cut and their logo scrapped.

Cutting Hummer; Duh! Sell it to the Norwegians or Russians or UAE or something. Wherever it is cold and has mountains or endless oil. The military division of Hummer should be retained and put into Chevy for developing military/industrial products.

Cutting: SAAB Well we saw this coming. They made an over engineered car un-reliable so GM deserves this one. From personal experience I will never buy another Saab again because of the reliability problems and obviously no one else is either. This is typical GM strategy, cut quality, save money, increase profits in the short term, piss off customers, loose customers, wonder why they can’t win customers back after costing them 5K in repair bills. Basically if you screw someone over financially once, they never forget it. This should not have happened because Saab had a lot of potential, but it’s pretty impossible to fix now.

 

2009 Super Bowl Ads Commercials Selling Fast on NBC

super bowl 2009 tampa bay florida game logo XLIII

It’s that time of year again when the first rumblings of the next year’s super bowl advertisers come out. (for super bowl 43) I think the companies just ask that their info be released this early to start the buzz cycle and get more mileage out of the media buy. There really isn’t any other reason to release the advertiser names now in September when the ads aren’t even finished yet.

They say the 30 second ad spots are selling for $3 Million dollars each. That is the going rate for a direct sales pitch into 88 million homes and TV sets all at the same time. (when are they going to start webcasting the game and the ads all together like a second delivery system of the same signal? why wouldn’t that work?) Advertisers that actually get a positive ROI from that kind of heavy hitting creative investment are wide appeal mass market companies that have products that are either seasonal at that time of year or products that relate to sports watchers or families watching at home.  Products like snacks, drinks, beer and cars have long been popular categories for Super Bowl Ads.

This year some of the confirmed advertisers are Pepsi and CocaCola, Anheuser-Bush, and a bunch of un-named Automotive, Movie and snack companies. Doritos have done really well the past few years and I wonder if they will plunge in again. I think the trend may be finally waning in the internet sites do ads category since few of them have that kind of money laying around anymore and/or need the visibility.

The timing of your ad during the Super Bowl Game is also crucial. The good spots are probably taken already in Q1 and Q3. Q2 gets boring because people have been sitting a while and just want halftime to start so they can use the bathroom and Q4 may be less well watched if the game isn’t almost tied the whole time. Many people just turn it off when the game is a blowout. The ends of pods are also bad because it just leads back into the game and consumers forget the ad pretty quickly. Being first in a pod is best since people have been proven to remember things in chunks and the beginning and end are usually the chunks they remember most.

Sometimes companies get their ads in at the last moment when 1 or 2 ads are left a week or two before the Super Bowl Game but this may not be available this year if companies are paying 300K more per ad willingly and forking over the money (or deposit) this early in the year. I think that marketers are realizing that in a fragmented market you have to be as prominent on every screen as possible to stay top of mind and above the chatter that gets tuned out. But ad placement is only 1/2 of the strategy. The other half is really the most important. It is really about relevance and humor. If you can make your product funny in a way that real people identify with personally, you have a winner and get all the chatter at the watercooler the next day.

HyperMilling How to Save Money on Gas, fuel economy and Drive Cheaper

I was surprised to read this article about driving, gas mileage and hypermilling which is basically the art of conservative driving to save gas in general by getting about 30% better gas mileage. Of course the results differ depending on which car you drive (or truck) but I think this article brings up a lot of good points and strategies. Here are some of the tips they suggest for saving gas (and money) and improving fuel economy for your car when driving around town:

1. Accelerate slowly from stoplights and stop signs. This is a huge gas saver for those of us who live in the suburbs and city. We do a lot of stop and go driving every day and this acceleration from the light sucks down fuel like nothing else. They recommend never pressing the pedal more than 1 inch down. Never floor the car or race away from the light. Just accelerate slowly and you will not waste gas.

2. Use your cruise control on the highway and tollway. I never do this but I will start now. If you want to avoid costly fuel surges in your engine, just set your cruise control for 55 mph or 65 mph depending on the speed limit, set your car in the right lane or middle one if there are super slow cars or trucks in the right lane, and get there at a normal consistent pace. The car is better at managing acceleration with just enough gas at a consistent rate than we are. Humans generally pump the pedal when they drive and constantly throw too much fuel into the engine and are highly inconsistent. Anyway, I like this because it isn’t that different from what we do now and it is more cost efficient.

3. Properly inflating the tires impacts the gas mileage very little and turning off the air conditioning on highway trips doesn’t do much either. (turning off the air conditioning in stop n go traffic can help though)

So take 20 seconds to accelerate away from traffic lights, turn off the air conditioning in stop and go traffic and use the cruise control as much as possible when driving on the highway and your gas mileage should go up and your fuel consumption should go down and you should save some more money.

And then there are always the old fashioned ways to save money on Gas like carpooling and using public transit. Don’t forget those either!

 

Presidential Primary, Barack Obama, Hillary Clinton, and Political Campaign Marketing

I am usually not very political and hate how spin and vicious attacks are used to sway people’s opinion when they have little or no impact on the job that someone would do. That aside I am interested in seeing who will win this next presidential election in the U.S. and how the marketing that their campaigns do impacts the outcome.

The first thing I noticed was that all the campaigns for the presidential primary elections and Iowa caucuses were utilizing Email. Rudy Giuliani used it the least (once a week is not enough) and Ron Paul was the most primitive with text only messages that seemed to be hand written after each event, but everyone got out the info about donating this way. I noticed that Barack Obama and Jon Edwards slowly built up momentum with emails supporting the increase in number of stories they had covered in the press. Hillary Clinton (Billary) has been sending a deluge of daily emails since about 6 months ago. I would say she has over-used this medium. I am almost becoming immune to the emails now and not even reading them anymore. I did think it was a nice touch that Rudy Giuliani sent an email thanking everyone after he dropped out of the race and another one a few days later asking his supporters to join the McCain camp. It was very classy and genuine.

Online they seem to really try and use banners to advertise their sites and not the issues, but I haven’t run across that many banners or display ads yet since I don’t hang out on political sites all that much. On TV they seem to be targeting the states and DMAs where there are primaries but I think national ads will be seen soon. I just hope they remain positive because there is much more to be gained in voter enthusiasm from a carrot rather than a stick. Text ads in search have also been utilized but I don’t think they have been as targeted or flexible as they should have been. They aren’t taking advantage of the customize-able real time edit-ability of these ads. All the candidates really need someone on the bus listening to issues and going to events that can be online at that moment and customizing campaigns to reflect the outcome. Plus a team in the background analyzing and optimizing the campaigns based on tracking conversion to donation data. One guy who does this as a second job and isn’t even very good at it isn’t the right solution. Barack, you’re just giving your money away for nothing with this one. 

The news publication/blog/press/PR area is another world all together. I feel like they all try and court this market the most and rely on these writers to transmit their message. The thing is not everyone watches or reads the news. I almost never do, because I am never home. Plus these writers are pretty willy nilly all over the place with what they cover and how frequently. They write about whatever the big thing is that moment and after the day the story runs, the buzz is gone. (plus a lot of it is fluff) It’s forgotten and on to the next big thing. It’s just so short. You have to keep churning out notable stories or always be the front runner to benefit from this medium. I would find this very frustrating to be over saturating a small market/audience of people with messages that are fleeting, confusing and less meaningful rather than building a real relationship with them over time or examining the issues and candidates in depth once and getting a final vote.

An alternative medium being used more this election than ever before is the use of political humor shows like The Daily Show with Jon Stewart and late night shows like The Tonight Show with Jay Leno and The Late Show with David Letterman. These shows give politicians an audience of voters who may not watch or read news because they are disengaged or apathetic. If they are light on issues and come across as like-able, funny and can take a joke making fun of themselves they may gain some votes this way from people who vote by like-ability rather than issues. I see the blur between news and entertainment blurring further in the future and this will continue to be a tactic in future campaigns.

I assume direct mail was a part of the mix although I didn’t get any mailings locally or nationally for the primary in Illinois. Lawn signs and outdoor signage in general always plays a big role leading up to the last month and days before an election. So do volunteers. This is really the backbone of the marketing organization. The enthusiasm, scripts message and overall level of performance of these cold callers and door knockers can make or break the candidate’s chances in local and primary elections. So do the quality and clarity of the leave behind brochures. They must differentiate your candidate from the others and make clear why they will be the best candidate in real terms for the voter.

Anyway, I will be watching and waiting as per usual to see how this comes out in the end. Who will you be voting for and why?

Super Bowl Sunday 2008 Almost Sold Out

I’m not sure why the 2008 super bowl ads are almost sold out in October when the game isn’t till February but maybe the holidays inbetween now and then have something to do with it. If you are one of the people who is buying one of these very very expensive FOX $2.7 million dollar 30 second ad spots here are some tips:

1. First consider is it really relevant to advertise in the super bowl? Is there a need for your product in February? Is there a relevance to families, football and/or men? These are the core demographics. If it’s not a match, skip it no matter how badly you want the publicity. 

2. Make em laugh. Funny ads have staying power both at the watercooler the next day and for months afterwards. If people relate to the humor in the situation its even better.

3. Use something new. Don’t run some old ad we have seen a million times already. New creative or no creative is the way to go.

4. Don’t bother with celebrities. Unless its particularly relevant to your product. And I don’t ever really think it is. They raise costs dramatically and don’t really raise the appeal of what a super bowl watcher is looking for.

5. Remember to support this really expensive placement so it is not instantly forgotten before consumers get out their pocketbook. Support the super bowl ad with a well diversified campaign offline, online and everywhere else. This means everything from TV commericals for weeks afterwards, search ads, social networking if possible, blogs if possible,  a microsite or at least a mention of the ad on your home page and make it available to view online, print ads if you still do that, emails linking to microsite and coordinating online display ads too.

6. You can make spending this much money on an ad a publicity event in and of itself. It is cheezy though and people don’t really care unless they are benefitting from it. A press release can be ok, and reveal some hints about why the ad will be appealing, but leave the big reveal of the commercial for the actual game. But again this is totally stupid if your ads are not new, not edgy, not funny and not successful. So, proceed with caution here.