Archive for January 20th, 2011

U.S. boot on BP’s throat lifted … by Russia.

January 20, 2011

Remember when Obama’s crack Secretary of the Interior — Cowboy Ken Salazar – said he was putting his boot on BP’s throat and keeping it there “until” they paid up?  Then, he and Obama demanded that BP set up a $20 billion account to fund recovery efforts. 

  • Side track: whatever happened to the recovery?  Haven’t heard much about it lately, have you?

Well, I guess the boot can be lifted from BP’s throat now … thanks to the Russians.

The NY Times reports:

Russian companies are talking to BP about buying billions of dollars in oil fields and other assets to help it pay its gulf cleanup and compensation costs.

Along with a partner, BP is planning to explore the rich oil fields in Russia’s Arctic waters, a region that is off limits in the United States and Canada.

And BP’s chief executive, Tony Hayward, who is turning over the reins this Friday to Robert Dudley, is being welcomed onto the board of TNK-BP, the company’s 50-50 joint venture in Russia.

NY Times, In Russia, BP Sees a Second Act, September 29, 2010

Though BP seems doomed to years of hostile regulation and lawsuits in the United States, in Russia, the second-most important country for the company’s operations, BP’s fortunes are brighter than ever.

Guess we showed them.

Posted in Oil & Energy | Leave a Comment »

What’s the difference between politics and economics?

January 20, 2011

According to conservative economist Thomas Sowell is short-term thinking that ignores second-order consequences:

  • A fundamental difference between political decisions and economic decisions: political decisions tend to be categorical, while economic decisions tend to be incremental.
  • That is, when the public votes in a candidate, that decision lingers and is broadly applicable. Whereas, economic decisions are more transactional.
  • As a result, the public can end up paying as taxpayers for increments of spending that they would not have chosen to make as individual consumers.

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  • Politicians have a clear bias towards policies that will produce good results before the next election — even if they can be expected to produce bad results afterwards. That is, second stage — or second order — consequences are routinely ignored.
  • For example, price controls may provide apparent short-term benefits, but have repeatedly shown that they ultimately constrained supply and create shortages.
  • Another example: a second order effect of the Americans with Disabilities Act — which mandated reasonable accommodations to those with disabilities — was a decline in the employment of people with disabilities.
  • Infrastructure spending — repairing bridges, roadways, dams, or government buildings — doesn’t provide an immediate, visible payoff. So, politicians defer spending on infrastructure unless there is some obvious defect that is both immediately visible and important to a large segment of the voting public.
  • Political thinking tends to conceive of policies, institutions, or programs in terms of their hoped for results, not the realistically likely results.

Source: Chapter 1, Applied Economics, Thomas Sowell, Basic Books, 2010

Posted in Economics, Thomas Sowell | 1 Comment »

Who’s controlling the purse strings? … Why, old Dad, of course.

January 20, 2011

TakeAway: As times change, more and more men are self-identifying themselves as the primary decision makers for the household and they don’t feel companies are doing a good job of targeting them? 

Know your audience and what is important and communicate that message in channels they will see. (NFL games perhaps?)

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Excerpted from AdAge, “Time to Rethink Your Message: Now the Cart Belongs to Daddy,” by Jack Neff, January 17, 2011

Mom is losing ground to Dad in the grocery aisle, with more than half of men now supposedly believing they control the shopping cart. The implications for many marketers may be as disruptive as many of the changes they’re facing in media.

… marketers of packaged goods … take solace in one thing — at least they could count on their core consumers being moms and reach them through often narrowly targeted cable TV, print and digital media.

But a study last year of 2,400 U.S. men ages 18 to 64 finds more than half identify themselves as the primary grocery shoppers in their households. …about six in 10 identifying themselves as their household’s decision maker on packaged goods, health, pet and clothing purchases. …only 22% to 24% of men felt advertising … speaks to them…

Recession has forced millions of men in construction, manufacturing… out of work and … into more domestic duties. At the same time, Gen X and millennial men in particular more likely to take an active role in parenting and household duties.

…any stigma once attached to men as shoppers is fading fast.

Behavioral research of shoppers shows a number more like 35% of grocery and mass-merchandise shoppers are now men…. That number has been growing thanks to the economy and changing gender roles, she said.

… the fact that a third of a brand’s shoppers are male is an awful lot to ignore. As a result, shopper-marketing efforts are increasingly gender-neutral rather than targeted for female shoppers,

Last year’s tear-jerking “Behind Every Olympic Athlete is an Olympic Mom” Winter Olympics ads for P&G created some resentment from dads, who still make up the vast majority of volunteer coaches for youth sports.

Perhaps favorably for marketers… men are more brand-loyal and less focused on promotions than women shoppers, Ms. Weinberg said. In advertising, they do more product research …because they’re often newer to the categories, prefer ads with more information.

There are more ads that speak to men,… But many …still portray [men] as hapless domestically, which doesn’t help marketers. “Men,” he said, “need to be something other than invisible or buffoons in advertising.”

Edit by HH

 

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Full Article
http://adage.com/article?article_id=148252

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Posted in Mktg - Consumer Behavior | Leave a Comment »