Archive for September 28th, 2011

To avoid the Gibson Guitars treatment, Ford pulls anti-bailout ad.

September 28, 2011

Punch line: As part of an ad campaign featuring “real people” explaining their decision to buy Fords, a guy named “Chris” says he “wasn’t going to buy another car that was bailed out by our government,”

Team Obama didn’t like the ad, and Ford pulled it so that Team Obama could stay focused on Gibson Guitars, S&P, and the tanning salons.

According to the Detroit News

Ford pulled the ad after individuals inside the White House questioned whether the copy was publicly denigrating the controversial bailout policy.

With President Barack Obama tuning his re-election campaign amid dismal economic conditions and simmering antipathy toward his stimulus spending and associated bailouts, the Ford ad carried the makings of a political liability when Team Obama can least afford yet another one. Can’t have that.

The ad, pulled in response to White House “questions” (and, presumably, carping from rival GM), threatened to rekindle the negative (if accurate) association just when the president wants credit for their positive results and to distance himself from any public downside of his decision.

In other words, where presidential politics and automotive marketing collide — clean, green, politically correct vehicles not included — the president wins and the automaker loses because the benefit of the battle isn’t worth the cost of waging it.

Once again, nothing like the Administration’s Chicago style politics.

Step out of line, and BAM !

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Majority now thinks Obama is blame-worthy for the state of the economy…

September 28, 2011

Based on a new Gallup poll, 69% say that Bush gets at least some of the blame for the bad economy … that’s down 10 points from a couple of years ago … as memories fade.

And, for the first time, a majority of Americans (53%) thinks that President Obama has some culpability for the current condition of the economy.  Only 25% of Dems think so, but 69% of independents give Obama some blame …  apparently, blaming Bush, tsunamis, Arab Springs, etc. is running out of steam.

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The perils of ‘free’ … Netflix tries to divide and reconquer … bet the under.

September 28, 2011

Punch line: Netflix tried to ‘seed’ their steaming video business with an irresistible offer: free.  But, customers revolted when asked to pay.Now, trying to be clever, Netflix is trying corporate fission: breaking into 2 parts.

I’m betting the under …

* * * * *
Excerpted from the Atlantic, by Megan McArdle:
The Qwikster and the Dead

Netflix admits that they’d really messed up the transition when they announced the end of free streaming, and that in order to fix it, they  decided to more decisively split their DVD and streaming services.

The DVD part will now be called “Qwikster” and have its own website; the streaming service will retain the Netflix brand.

The internet’s collective reaction sits somewhere between foaming rage, and an enormous collective “What the hey, Netflix?”

It’s so bizarre.. What problem does this solve?

Netflix does have a huge problem.

The company never wanted to be in the mail-order DVD service long-term; it’s not a good business.

Redbox was threatening to carve off the casual users, leaving them with the high-traffic movie buffs who don’t make them money.

Plus any idiot can see that the future is likely to be in painlessly streaming movies over the internet, not putting physical discs in little envelopes and mailing them.

The fact that the Postal Service is near bankruptcy tells you a lot about the viability of business models based on mailing things.

The problem is that they tried to build their streaming service by giving it away for free, as an add-on to their snail-mail service.

This was a good way to add customers.

But the history of the internet indicates that once you convince people something is supposed to be free, or close to it, you will have a devilishly hard time getting them to pay for it.

Unfortunately, users had been conditioned to expect unlimited free ice cream; they didn’t like having to pay for it.

Subscriptions dropped instead of rising.

Netflix stock went into a  rapid decline.

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So I understand that Netflix was in a bad place.

But I don’t understand how Qwikster solves any of these problems.

It doesn’t improve their bargaining position with the content providers.

It doesn’t soothe angry customers who don’t like having to pay for stuff they used to get for free.

Thanks to Tags for feeding the lead.

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