Happy Halloween! Want A Chip?

Found an interesting site the other day – Hotel 626.com. There are several cool elements on this site like soliciting email addresses as a “reservation” to access the site, webcam and microphone integration and overall the site is incredibly creepy (just in time for Halloween). There’s really no direct product pushing so from the user’s perspective it’s pure entertainment. It belongs to Frito Lay, but from a messaging perspective that’s put on the back-burners.

What’s really interesting is the way they handle access to the site. As indicated by the name, the site is only accessible from 6 PM to 6 AM (Hotel 626). Here’s why I think this is a cool idea:

It’s Risky, But Not Really.
Would this approach work for 90% of the sites out there? No, absolutely not. But, I think it’ll work quite well for this one. The reasoning is that it’s risky, but not really. Although it’s harder to access the site, they have technology in place (reservations) that’ll send the user an email when the site opens for the evening. On top of that, they’re effectively weeding out the fickle fly by night users and honing in on the active, engaged market. This brings you closer to your loyalists; and it’ll certainly provide a decent amount of those lost in the branding “grey area” as well.

It’s Breaking the Typical Online Experience.
We all know that the tougher you make your online content to access, the more you become susceptible to increased drop-off, decreased conversion and all the wonderful financial repercussions in between. However, this site’s putting that school of thought on its head a bit. In an environment where users are cynical, have the shortest of attention spans and have more competing entertaining online options at their beckon call than ever, this site tells them to “wait, you’re going to view this site on our terms.” It’s all very reminiscent of the trickle-like release of Nintendo’s Wii and the iPhone.

However, this site’s not directly tied to revenue, which begs the question – what will they do next? It sounds like there’s a product launch coming, in which case Frito Lay will be locked and loaded with a pool full of advocates and otherwise engaged users just waiting to mobilize and ultimately, eat some chips.

As always, time and traffic numbers will bring success or failure, but I’m very interested to see how the product launch goes.

Summer Reading List

Following Paul’s reading lead in his post titled Being A “Small Giant” I decided to see if I could get some feedback on my own summer reading list. Like Paul I am constantly trolling online publications and eNewsletters – AdAge, CNET, Austin Business Journal, the IAB SmartBrief, etc., etc. for the latest happenings and breaking news in the industry. Along the way I have come across several book reviews that I thought were worth adding to my list.

As the dog days of summer approach (or are already here in Austin, Texas - I think they said it was going to get up to the 90’s today!) I plan on watching less TV and reading more books. So far on the list I have:

· Basic Black: The Essential Guide for Getting Ahead at Work (and in Life) – By Cathie Black

Not sure why this made my list (I guess I should start trying to “get ahead” by taking better notes).

Here is a brief synopsis from the book:

Cathie Black is the wise, funny mentor that every woman dreams of having. She was a pioneer in advertising sales at a time when women didn’t sell; served as president and publisher of the fledgling USA Today; and, in her current position as the president of Hearst Magazines, persuaded Oprah to launch a magazine. In 2006 she was named one of Fortune’s “50 Most Powerful Women in American Business” for the seventh consecutive year. Now, in the exuberant, down-to-earth voice that is her trademark, Cathie explains how she achieved “the 360° life”—a blend of professional accomplishment and personal contentment—and how any woman can seize opportunity in the workplace.

A fairly limited web search unearthed mixed reviews on both her book and her character. I won’t make any predications about her character having never met her, but book reviews generally stated that the book only offered limited advice. Publishers Weekly states “While the author’s life is an interesting one, readers looking for tips will do better with a more pointed book” (see entire Publishers Weekly review and others here).

It is always interesting to learn about others’ path in life and business and gauge your own resolutions if put in similar situations. I think I will keep this book on the list for now.

· The Education of an Accidental CEO: Lessons Learned from the Trailer Park to the Corner Office – By David Norak

Book summary:

David Novak—one of today’s most engaging, unconventional, and successful business leaders—lived in thirty-two trailer parks in twenty-three states by the time he reached the seventh grade. He sold encyclopedias door to door, worked as a hotel night clerk, and took a job as a $7,200-a-year advertising copywriter with the hopes of maybe one day becoming a creative director. Instead, he became head of the world’s largest restaurant company at the ripe old age of forty-seven.

While David never went to business school, he did learn from the greatest of teachers—experience—and plenty of other very smart people as well: Magic Johnson on the secret to teamwork, Warren Buffett on what he looks for in the companies he buys, John Wooden on ego, and Jack Welch on one thing he’d do over. Now he wants to share with you what he discovered about getting ahead and getting noticed; motivating people and turning businesses around; building winning teams and running a global company of nearly one million people; and always staying true to yourself.

I know why this one caught my eye - I can never get enough of the underdog story and am constantly amazed by those that overcome seemingly insurmountable odds. Probably has the potential to be a bit hokey, but most reviewers seem to agree that it provides guidance, inspiration and strength to those seeking success in business. Read more reviews here and here.

· What Sticks: Why Most Advertising Fails and How to Guarantee Yours Succeeds – By Rex Briggs and Greg Stuart

Book summary:

What Sticks is the one book that explains exactly how marketing and advertising works today! Based on new insights from analysis of over $1 billion worth of advertising.

Decades ago it was okay to believe, as retail magnate John Wanamaker did, that “Half the money I spend on advertising is wasted; the trouble is, I don’t know which half.” However, today the stakes are much higher. Marketing thought leaders Rex Briggs and Greg Stuart estimate that $112 billion in advertising spending in the U.S. alone is wasted, cutting deeply into company profits.

What Sticks uncovers bold new insights from the largest-ever global marketing research project among 30 Fortune 200 companies, including: Procter & Gamble, Johnson & Johnson, Kraft, McDonalds, Unilever, Ford and others. This is a comprehensive and solutions-oriented book that outlines how any marketer, at any level, can guarantee their advertising succeeds.

This book appears to veer away from the anecdotal nature of the above selections and focuses on more practical applications. AND it is research driven, which mirrors Sentient’s approach of listening to the customer before embarking on a solution path.

Reviews can be found here.

If you have read any of these books or have others to add to my summer reading list I would love to hear from you.

The Best Things in Life are Free

Have you thought about how many free (or near free) products and services you use in a day? Here are just a few examples.

• Google – nearly all services used by consumers are free – from email to Picasa to GOOG-411.
• News – you can’t even count the number of websites that give news away for free. Now there is an ongoing rise of *paper*-based newspapers and magazines distributing news for free too.
• Web-based services – there’s everything from financial services to diet plans available.

For an impressive round-up of free (or near free) products and services in many categories check out this trend report from trendwatching.com: FREE LOVE.

Chris Anderson sums up this phenomenon of free in his article “Free! Why $0.00 Is the Future of Business” in Wired Magazine and also explains it in an interview with Ad Age. The cost of goods is becoming cheaper, and digital technology is experiencing this on a grand scale. As technology advances and bandwidth, storage, and processing power continue to increase (often for less than last year’s model), the cost of supporting additional users becomes more and more marginal.

Why would you offer something for free? Because money isn’t the only scarcity in an economy. So is attention (as Seth Godin points out). And, in a world where consumers have reached their saturation point, free gets attention. Free allows consumers to skip the cost-benefit analysis in terms of money. You still have to make a worthwhile offer though, because if you waste their attention and time, then consumers will be just as angry as if you had wasted their money.

As marketers, we instinctively understand some of this “value of free” – cross-subsidies, loss leaders or encouraging a first trial or purchase by offering a sample. As we forage into an increasingly digital world and costs move towards zero, we are challenged to explore new business models. My humble opinion is that this seems to work with online business models. Offering a service for free = more users on the site = more advertisers willing to buy in. Or offer a free version of a web-based service and a premium for-pay version that has more features, and the pay supports the free. There are overhead costs for servers, development, etc., but they are spread over thousands or even millions of users. So when you divide it out, the cost to support one more user is negligible.

Offline, this concept of free seems harder to grasp. Tangible freebies are costly to produce and distribute, and lots of marginal costs total to one big cost. The question becomes, how do we not only make up these costs, but *profit* from them? There are some companies that are out there working on this conundrum to offer their products and services for free or near free. For example, here’s how Ryanair offers near free air travel. The pie chart does a great job explaining how Ryanair meets the costs of their flights, but I have some issues with it and especially the explanation below it.

1. Cut costs – this point makes sense to me. Boarding and disembarking from the tarmac and going to less-popular airports are smart moves to keep expenses down.
2. Ramp up the ancillary fees – this irritates me. I do not want to be charged for using my credit card or checking my luggage or wanting a drink. And $3.50 for a bottle of water is an obscenity that’s mostly reserved for sporting events and theme parks. A fair question is do they really think that people aren’t going to realize where the profit is coming from and stop drinking the water? After all, they won’t fly out of the country for more than $100 so why in the world would they pay almost $4 for 12 ounces of water?
3. Offset losses with higher fares – I suppose all airlines do this to some degree, charging a higher price for popular flight days. However, if the consumer is price conscious, and comes to Ryanair looking for a $20 flight, how often are they going to choose to fly on the more expensive days? Just from a mathematical standpoint, if 30% of your airline is ‘expensive’ and the remaining 70% is ‘average’. That high end 30% has to support a portion of average flights twice its size for the airline to profit. Which begs the question of how long do you feel you can pull a fast one on the high end customers?

What are your thoughts? Is $0.00 the future of business? What freebie models do you know that work? Which ones don’t seem to work?

Starbucks Media Jolt

Branding has become a hot topic again in the mainstream media (to some, myself included, it is always a hot topic. I guess it is the nature of the job). This week on the Today Show they featured the decline of the Starbucks brand. Starbucks’ woes in the last year, slowed growth and declining sales, is no secret and it seems every advertising joe has an opinion on what they should do. Most opinions center on returning the focus to the baristas and making the best espresso. The point being that the barista position (for more on baristas visit here) is not interchangeable with the cashier or the greeter or even the store manager, it is a honed skill that takes training and plays a pivotal role in elevating Starbucks above competitors. AND the extended business lines – music, movies, network tv, really doesn’t heighten the taste of my Grande Non-Fat, Double Vanilla Late at the end of the day either.

It would appear Starbucks is listening. In addition to the expected permanent closure of several stores and 600 job cuts, Starbucks temporarily closed all stores Tuesday evening (2/26) for several hours to retrain employees err baristas to “provide a renewed focus on espresso standards” (see full letter to partners, entitled “Starbucks Makes Organizational Changes to Enhance Customer Experience”). There are also plans to stop serving hot breakfast by the end of Fiscal ’08 and offer free or discounted WiFi beginning this spring.

So the obvious question is…was this really an effort to put the focus back on good coffee making OR was it a PR exploit to show off Starbucks renewed focus?

I present exhibit A: National Media Coverage of Starbucks Closing

• FOX News
  
• Today Show
  
• USA Today
  
• MSNBC
  
• ABC
  
• And the list goes on and on and….

Exhibit B:

• Let me also point out that Starbucks isn’t open 24 hours and could have offered this “training session” after hours.
• Not to mention, the length of the session was reported to be 3 hours. Can you really impart knowledge, grow your craft, and produce minions of genius baristas in a one-time 3 hour session?

Will it work? Well I suppose an afternoon training session is a start, but something tells me it is going to take more than a few hours of coffee making How To, to fix Starbucks (call me a pessimist). But maybe it is a start? Maybe, just maybe this media frenzy will make Starbucks accountable to their customers and force them to return to what made them good in the first place – good coffee and atmosphere? They have drawn a very public line in the sand, put a big ol’ stake in the ground, etc., etc. and the stage is set (can I use anymore clichés?) to deliver BIG. Does media frenzy = accountability = return to good coffee and atmosphere? Tell me what you think?

Dogs Rule!

Here’s a campaign that seems to have popped up with a new found sense of urgency - Pedigree’s Dogs Rule campaign. The site, most likely the brainchild of TBWA/Chiat/Day in Los Angeles is extremely well done from both execution and strategic standpoints.

The premise is simple, “We Love Dogs”. What does that mean exactly? Well, in the context of this campaign it means that Pedigree will match monetary donations, as well as Pedigree product donations given by customers to assist animal shelters located near the customer/donator. Ultimately, it means that Pedigree is working to help homeless dogs find homes and ensure they are a little more comfortable during their temporary period of orphanhood.

Normally, at this point in the post, I’d walk through each creative deliverable and critique it’s execution within the context of the campaign. I’d throw around vernacular like viral components, digital revolution and Age of Conversation. In this particular post, I’ll save us the effort in wading through simple concepts with overly sophisticated names. I don’t feel there’s anything wrong with the use of those terms, nor do I have issue with any of the sources linked above, but in this instance, they’re not of primary interest. The individual executions of this campaign are not flawless, but they are very well done. The point is this - where this campaign really sets itself apart; is when we step out of our “jaded creative guy” skin and put on the trusty “business” hat.

So what’s so different about this campaign? Take a look at the facts, and think about it……….

• Dogs eat dog food.
• Pedigree sells dog food.
• Homeless dogs are put to sleep, thus removed from the market, if they are not adopted.
• The Dogs Rule campaign is designed to help homeless dogs find adopted homes.
• If the Dogs Rule campaign is successful in finding homes for homeless dogs, there will be more dogs in the market consuming dog food, thus the revenue potential of this vertical will increase.
  

As a result of the success of this campaign there could be a significant increase in revenue potential for Pedigree, given their current share of voice and share of market. This could potentially be the ultimate win/win scenario. Consumers, who love dogs, adopt a dog or an additional dog – Pedigree has helped them do so and the consumer couldn’t be happier. On the other side of the coin, Pedigree gets access to a larger pool of revenue that their customers, financially, helped them cultivate.

So here’s the point – In today’s marketing environment, full of the increasingly sophisticated, inevitably cynical consumer, your customers will cry bloody murder if they smell even a hint of corporate ambition. I’m not implying Pedigree went into this campaign with that particular objective, but what I’m saying is if you know the customer, and you create advertising/marketing strategy that is spot on to their needs………..it doesn’t matter. As a brand, if you can show you know your customer and you care about what they care about AND provide the actions to support that claim then your leash (so to speak) gets significantly longer. In this case, people who love dogs tend to love ALL dogs, and genuinely appreciate the efforts of shelters, non-profit groups and dog food manufacturers alike who are working to improve the lives of dogs and enlighten owners-to-be. This campaign is a fantastic example of insights informing the creative process and creative being effectively implemented to support those findings.