October 10, 2011
Punch line: The proper role for government is to support basic research, not commercial ventures
Excerpted from the WSJ: The Solyndra Economy
“Listening to the President, Solyndra was a necessary casualty in the greater campaign to steer the U.S. economy toward Mr. Obama’s noble goals.
Private competition that winnows out losers is so yesterday.
Brad Jones of Redpoint Ventures got to the heart of the Solyndra economy in a December 2009 email to then-National Economic Council director Larry Summers:
“The allocation of spending to clean energy is haphazard; the government is just not well equipped to decide which companies should get the money and how much . . . One of our solar companies with revenues of less than $100 million (and not yet profitable) received a government loan of $580 million; while that is good for us, I can’t imagine it’s a good way for the government to use taxpayer money.”
Which is precisely the point.
The proper role for government is to support basic research, not commercial ventures that become exercises in taxpayer risk but private reward.
When government takes $535 million and invests in a loser, it not only wastes taxpayer money but it also denies that capital to some other project in the private economy that might have succeeded.
The Solyndra emails show how ill-equipped government is to predict the industries of the present, much less the future.”
Why no Occupy Wall Street placards on this one ?
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Tags: Government, Solyndra, Venture capital
Posted in Gov't Waste & Inefficiency | Leave a Comment »
October 10, 2011
Punch line: Obama’s job bill would let unemployed folks sue an employer with an opening if they think they haven’t received due consideration in the hiring process.
Excerpted from AP: Unemployed seek protection against job bias
A growing number of unemployed or underemployed Americans are complaining that they are being screened out of job openings for the very reason they’re looking for work in the first place.
Because they’re unemployed.
Some companies and job agencies prefer applicants who already have jobs, or haven’t been jobless too long.
They may get help from a provision in President Barack Obama’s jobs bill, which would ban companies with 15 or more employees from refusing to consider — or offer a job to — someone who is unemployed.
The provision would give those claiming discrimination a right to sue, and violators would face fines of up to $1,000 per day, plus attorney fees and costs.
Let me get this straight.
So, when benefits run out after 99 weeks – almost 2 years – then companies must hire them.
Perhaps there’s a reason that the 9% who are unemployed aren’t in the group of 91% who are employed.
You think ?
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Tags: Obama's jobs bill, unemployment
Posted in Employment - Jobs | Leave a Comment »
October 10, 2011
Many pundits are calling Herman Cain a “flash in the pan”.
I thought it simply meant “here today, gone tomorrow” … but got curious.
Here’s a more official reading from Phrases.org
Flash in the pan: Something which disappoints by failing to deliver anything of value, despite a showy beginning.
The origin …
One notion is that this phrase derives from the Californian Gold Rush of the mid 19th century.
Prospectors who panned for gold supposedly became excited when they saw something glint in the pan, only to have their hopes dashed when it proved not to be gold but a mere ‘flash in the pan’.
This is an attractive and plausible notion, in part because it ties in with another phrase related to disappointment – ‘it didn’t pan out’.
Nevertheless, gold prospecting isn’t the origin of ‘a flash in the pan’.
The phrase did have a literal meaning, i.e. it derives from a real flash in a real pan, but not a prospector’s pan, a musket’s pan.
Flintlock muskets used to have small pans to hold charges of gunpowder.
An attempt to fire a musket in which the gunpowder flared up without a bullet being fired was a ‘flash in the pan’.
Now we know …
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October 7, 2011
Punch line: According to the WSJ, nearly half of all U.S. households now receive some type of government benefit.
- Over 1/3 of Americans lived in a household that received benefits such as food stamps, subsidized housing, cash welfare or Medicaid.
- Almost 15% lived in homes where someone was on Medicare or Social Security, or both.
Reminder: Some 46.4% of households will pay no federal income tax this year, according to the nonpartisan Tax Policy Center. That’s up from 39.9% in 2007
My bet: All of these households think spending cuts are a bad idea …
and tax hikes on other folks are strokes of brilliance.
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Tags: Entitlements, Taxes
Posted in Entitlements, Health Care / Medical Insurance, Social Security, Taxes | 1 Comment »
October 7, 2011
Punch line: In tough economic times you gotta cut back, right?
Some parents are simply lengthening the time between their kids’ diaper changes.
Gross.
And, it’s penny wise – pound foolish … just raises the home’s decibel level and the ointment bill.
Excerpted from WSJ : Cut Back Diapers
As the economy continues to sputter, recent data show diaper sales are slowing and sales of diaper-rash ointment are rising.
Diapering a child six times a day costs about $1,500 a year, so it isn’t hard to see how it could become a burden on families dealing with chronic unemployment or struggling to cover rising costs.
Meantime, sales of diaper-rash ointment have increased 8% over the past year and pediatricians say the higher sales likely reflect either less frequent changes or a shift to lower quality diapers.
A pediatrician at Northwestern Memorial Physicians Group in Chicago, says she has seen a 5% to 10% spike in diaper-rash cases this year.
“We’re definitely seeing major effects of the economy: Diapers are very expensive, and the longer you sit in a dirty diaper, the more likely the chances of an infection.”
P&G says the new “wetness indicator” on Pampers Swaddlers has saved his family unnecessary diaper changes because “you don’t have to take the diaper off. You can just see the indicator, and you know if the baby is wet.”
P&G says its research shows parents are also potty training children earlier to save cash as economic uncertainty deepens.
Wonder if the wetness indicator was inspired by the pop-up that tells you when the T-Day turkey is ready?
Thanks to DM for feeding the lead.
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Tags: Diapers, Economy, P&G
Posted in Mktg - Consumer Behavior | Leave a Comment »
October 6, 2011
For a couple of years, I’ve been saying that private capital should be unleashed to stabilize the housing market.
How? Accelerated depreciation for residential rental property with unabsorbed passive losses used to reduce ordinary income … and no capital gains on the property when sold – after a couple of years minimum holding period.
Well, well, well.
In a Bloomberg article “U.S. Can Rent Its Way Toward a Housing Recovery”, Peter Orszag – Obama’s former budget guy – now proposes roughly the same idea.
Just a couple of years late.
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Tags: Housing, Orzag, private capital, residental rental property
Posted in Housing - Mortgages | Leave a Comment »
October 6, 2011
According to innovation guru Clayton Christensen:
Statistically, 93% of all innovations that have ultimately become successful started off in the wrong direction
The probability that you’ll get it right the first time out of the gate is very low.
Excerpted from MIT Sloan Review: Good Days for Disruptors – An Interview with Clayton Christensen Spring 2009
Bottom line: stay flexible, don’t get wedded to a concept …. constantly look for repurposing of the product or its technology.
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October 6, 2011
According to Business Week, Costco claims gets about 75% of its income from membership fees.
So, with income under pressure, the company is going to the well and jacking them up.
The WSJ reports:
Costco said it is raising membership fees 10% for about 22 million customers, as the largest U.S. warehouse club operator seeks to offset rising costs.
The fee increase is the company’s first in more than five years.
Currently most members pay an annual fee of either $50 or $100 for executive members
What’s a “seniors’ buffet”, you ask?
Well, Costco is famous for having blue-haired women cooking up and passing out food samples. So many, that legend says that some fixed income oldsters buy the membership just so they can come and graze on the samples.
I’m not into to that, but I am into Costco’s giant hot dog and 16 oz. drink for $1.50.
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Tags: Costco, membership fees, Seniors' Buffet
Posted in Retailing | 1 Comment »
October 5, 2011
As far back as July, 2009, the HomaFiles is on record as saying that the economic recovery would be slow and delayed for reasons beyond pure economics. That CEOs would be reluctant to hire as long as the Administration was punitively anti-business.
At the time, we said:
The bottom line: businesses will resist government policies passive aggressively. Fewer jobs will get added back than history would suggest, and those that get added back will materialize later than past patterns. Businesses will add jobs as a last resort rather than trying to build capacity ahead of the economic growth curve. Why should companies increase their costs and risks any more than is absolutely necessary ? Companies will continue to off-shore jobs, but will be more clever and clandestine about it, e.g. by vertically disintegrating and simply buying goods and services from 3rd parties.
Given the Administration’s anti-corporate rhetoric, actions, and proposed game-changing rules, I doubt that many CEOs will be taking on added costs and risks to boost the administration. More likely, they will let unemployment continue to creep up, and will slow roll the process of rehiring. Corporate chieftains will sit back and watch the President squirm.
Why private sector jobs won’t be coming back any time soon … hint: it’s called passive aggressive resistance, July 21, 2009
My view wasn’t really original thinking. It was simply what I was hearing privately from senior biz execs.
Well, a couple of years later, the argument seems to be catching some traction.
In an article titled The Coming Post-Obama Renaissance, Victor Davis Hanson writes:
When Obama leaves office, there will be a sense of psychological release in the business community that will lead to a far greater “stimulus” than printing more money.
the country is still growing, still needs new homes, more food, and more energy.
We are not a shrinking nation with the demographic crises of a Europe or Russia.
Soon the mounting pressure will be released by a new change in government and we will see a recovery that should have occurred more than two years ago when the recession officially “ended” in June 2009 — only all the more enhanced due to its delay.
If I were a GOP President-elect, I’d call in the business movers & shakers … tell them that I’ll be working feverishly to support business … and ask them to give the benefit of the doubt and to start making decisions “at the margin” – e.g. an extra job here or there – to move the economy ahead. Not dumb stuff – just some decisions at the margin. Suddenly, there would be a virtuous cycle.
Remember, you heard it here first. …
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Tags: Economic recovery, Passive aggressive behavior, Post-Obama Renaissance
Posted in Economics, Employment - Jobs, Obama | Leave a Comment »
October 5, 2011
TakeAway: Tablet users are making more purchases online at a higher volume per purchase than consumers who shop via smartphones or the internet and retailers are responding to this trend.
* * * * *
Excerpt from WSJ: “Tablets: Ultimate Buying Machines”
Tablets still account for only a small percentage of overall e-commerce, but they are punching above their weight.
While the conversion rate — orders divided by total visits — is 3% for shoppers using a traditional PC, it is 4% or 5% for shoppers using tablets…
Many retailers also report that tablet users place bigger orders—in some cases adding 10% to 20% more to the tab—on average than shoppers using PCs or smartphones.
Retailers are trying to take advantage of that trend by tweaking their websites to better accommodate tablets and rolling out catalogs that have been developed for the device.
Edit by ARK
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Posted in Internet Marketing - eCommerce - | Leave a Comment »
October 5, 2011
McKinsey recently published a report “Big Data – The Next Frontier” that concludes:
The United States faces a shortage of 140,000 to 190,000 people with deep analytical skills as well as 1.5 million managers and analysts to make decisions based on their findings.
Crunch those nums …
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October 4, 2011
Punch line: Part of the formula for getting the economy moving is to have a new industry emerge – or have a latent one take-off.
Obama tried with his failed green energy initiatives.
Now, there’s increasing support for for turning the domestic oil, gas and coal industries loose.
Makes sense to me.
And, makes sense to Senators Webb & Warner who have introduced a bill that would expand oil drilling off the shores of Virginia … and split the royalty fees between the Feds and the state.
Their argument: raises revenues without raising individuals’ taxes, reduces dependency on foreign oil, potentially reduces – or at least contains – gas prices, and – oh yeah – adds jobs.
Keep reading …
* * * * *
Excerpted from Forbes: Gassing Up: Why America’s Future Job Growth Lies In Traditional Energy Industries
The Praxis Strategy Group looked over data for the period after the economy started to weaken in 2006.
Not surprisingly “recession-proof” fields such as health care and education expanded some 11% over the past five years.
But the biggest growth in jobs by far has taken place in the mining, oil and natural gas industries, where jobs expanded by 60%, creating a total of 500,000 new jobs.
The average job in conventional energy pays about $100,000 annually — more than twice as high as those in either health or education.
Overall U.S. oil production has grown by 10% since 2008; the import share of U.S. oil consumption has dropped to 47% from 60% in 2005.
Over the next year, according to one recent industry-funded study, oil and gas could create an additional 1.5 million new jobs.
The relative strength of the energy sector can be seen in changes in income by region over the past decade. For the most part, the largest gains have been heavily concentrated in the energy belt between the Dakotas and the Gulf of Mexico.
Energy-oriented metropolitan economies such as Houston, Dallas, Bismarck and Oklahoma City have also fared relatively well.
In energy-rich North Dakota there’s actually a huge labor shortage, reaching over 17,000 — one likely to get worse if production expands, as now proposed, from 6000 to over 30,000 wells over the next decade.
With the proper environmental controls, these industries could provide a major jolt to the economy while cutting down on energy imports, reducing debts and bringing jobs back home.
As long as Americans consume oil and gas, why not produce close to the market and with reasonable environmental controls?
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Tags: energy, gas. coal, Jobs, off-shore drilling, oil, Virginia, Warner, Webb
Posted in Economy, Energy | Leave a Comment »
October 4, 2011
TakeAway: Book publishers have created a new pricing strategy to cover their fixed costs of printing…… increase their prices on e-books.
* * * * *
Excerpted from WSJ: E-Book Prices Prop Up Print Siblings
As physical book sales fall, publishers are having a harder time covering their fixed costs.
One area where major publishers can cushion the blow is by keeping e-book prices higher.
The six major publishers have adopted a new pricing model, known as “agency pricing,” Publishers agreed to set the consumer prices of their digital titles. Under this model, retailers act as the agent for each sale and take 30%, returning 70% to the publisher.
For example, the digital wholesale price was often $13. If Amazon sold the book for $9.99, it lost $3.01 per sale.
But a back-of-the-envelope calculation of a new e-book priced at $12.99 under the 70%-30% agency pricing model suggests a return of $9.09 to the publisher in the form of sales. The publisher then typically has to pay the author 25% of net sales in the form of a royalty, or $2.27. This leaves a gross of $6.82. Subtract 90 cents for digital rights management, digital warehousing, production, and distribution, and that leaves $5.92.
By comparison, a hardcover book priced at $26 and sold under the traditional wholesale model will return $13 to a publisher. Subtract 15% for the author royalty, or $3.90, and that leaves a gross of $9.10 then deduct about $3.25 per copy for shipping, warehousing and production, leaving a gross per unit sold of $5.85, from which publishers must pay for returns and inventory…
Edit by ARK
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Tags: Books, E-books, Fixed Costs, Publishers
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October 3, 2011
Interesting analogy from NFL Hall of Famer Fran Tarkenton.
Guess the system he’s describing…
Extracted from WSJ: What if the NFL Played by Different Rules?
Imagine the National Football League in an alternate reality.
Each player’s salary is based on how long he’s been in the league. It’s about tenure, not talent.
The same pay scale is used for every player, no matter whether he’s an All-Pro quarterback or the last man on the roster.
For every year a player’s been in this NFL, he gets a bump in pay. The only difference between Tom Brady and the worst player in the league is a few years of step increases.
And if a player makes it through his third season, he can never be cut from the roster until he chooses to retire, except in the most extreme cases of misconduct.
Of course, he’s talking education and why the union-dominated school systems underperform.
Not a lot of new news, but brings the problem to life.
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Posted in Education - Academics | Leave a Comment »
October 3, 2011
Ken’s Take: The article excerpted below got me thinking.
There’s been increasing talk recently about how blacks are provably suffering disproportionately in the current economic environment. The facts are unshakably true.
Even the Congressional Black Caucus has risen to the cause and chastised Pres. Obama for largely ignoring their plight.
Not new news.
The article below observes that “black interests often have to take a back-seat to the interests of labor, environmentalists, immigration advocates, and so on — even among those elected to represent African Americans!”
Obama’s response: Stop whining, stop complaining … kick off your slippers, put on your shoes … and walk to get me re-elected.
Then, along comes Herman Cain – dishing one-liners that cut to the core … pitching his story of self-reliance, hard work, and earned success … and, arguing that blacks can accrue political power by splitting their votes across parties, rather than voting as a bloc.
It’ll be interesting to see if his vision resonates among African-Americans.
* * * * *
Excerpted from Weekly Standard: Herman Cain Could Be a Game Changer
If Herman Cain could get some African Americans to give the GOP a look, there would be a real potential not only for the party to do better nationwide, but also for African Americans to leverage their voting strength more effectively.
African Americans do not enjoy robust two party competition for their votes, and accordingly their interests are often poorly served.
- White conservatives overwhelmingly vote Republican, but black conservatives do not.
- White moderates usually split their votes between the two parties, according to the study, but black moderates do not.
In many respects this state of affairs is bad for African Americans, because it limits the power of the black vote itself, and so a lot of black interests are just plain overlooked.
For instance, school choice would essentially be a transfer of resources and power directly to poor black families, who would be major beneficiaries of such a program.
However, the National Education Association and the American Federation of Teachers would be losers in the deal, so it is a non-starter on the Democratic side of the aisle.
Additionally, liberal immigration policies do not hurt educated whites, whose skills basically price them out of competition with most immigrants.
If anything, upper income whites are helped because a glut of workers enables companies to keep costs, and therefore prices, down.
Instead, African American workers – who often find themselves in competition with immigrants – would be harmed.
But the Democratic party as a whole would be helped thanks to a flood of new immigrant voters, so it unabashedly advocates loose policies.
Black interests often have to take a back-seat to the interests of labor, environmentalists, immigration advocates, and so on — even among those elected to represent African Americans!
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Tags: Black vote, earned success, Herman Cain, sel-reliance
Posted in Cain, Herman, Economy, Obama | 1 Comment »
October 3, 2011
Punch line: By 2013, Walmart will launch nationally more Neighborhood Market Stores that are smaller in size and offer groceries.
* * * * *
Excerpted from brandchannel.com, “Walmart: Your Friendly Neighborhood Grocer (by 2013)”
When you think Walmart, you generally think big and you don’t generally think groceries, but its Neighborhood Market stores may change that.
Chicago opened its third Walmart this week, but this is a Neighborhood Market store … At about 27,000 square feet, the downtown store is a fraction of a regular-sized Walmart, which can be as large as 150,000 square feet.
And while groceries are typically 1/3 of the product sold at a Walmart, it takes up ¾ of the Market …
Walmart has been opening Neighborhood Markets since 1998 and now has 155 nationwide with plans to have 300 of them by 2013 …
Chicago launched the first Walmart Express in July. “Our approach to the city of Chicago is to be flexible,” Walmart spokesman Steve Restivo. “We want the store size and the merchandise mix to be a reflection of the community it’s in.” …
Edit by KJM
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Posted in Retailing, Walmart | Leave a Comment »
September 30, 2011
Punch line: Last weekend I was displeased by Starbucks. Why? Because they razed the local KFC (and neighboring Popeye’s) to erect a new super-Starbucks.
Bummer.
So, I was ripe for a satirical video ripping SBUX.
Too bad the guy got fired
Excerpted from AOL: Singing Starbucks Employee Fired For YouTube Video
A Starbucks employee with a knack for satire uploaded an acoustic ballad about his employer that quickly went viral.
Starbucks – demonstrating no sense of humor – fired the dude.
In the song, the former barista admits to various behaviors that gave the corporate bigwigs pause:
- giving customers decaf when there’s no fresh regular,
- mocking rich white women for thinking a skinny vanilla latte is a sensible diet drink,
- giving free stuff to his friends,
- secretly making not nonfat cappuccinos
- making Frappacinos out of whipped cream.
In general, he paints an unflattering portrait of the world’s largest coffee chain: customers who are terrible people, food and beverage offerings that will induce heart disease and diabetes, and an oppressive grind of a workday for minimum wage.
See for yourself …
Thanks to MET for feeding the lead.
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Posted in Starbucks | Leave a Comment »
September 30, 2011
Punch line: Netflix got into a hole by initially giving away its video streaming offerings … in essence, pricing based on marginal cost.
That can work, when everybody isn’t a marginal customer …
Excerpted from The Atlantic by Megan McArdle:
The Qwikster and the Dead
Netflix tried to build their streaming video 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.
People decided that they were supposed to be able to stream unlimited movies for free.
This never made any sense; people were confusing the marginal cost with the average cost.
You can always get a sweet deal if you are the customer who gets marginal cost pricing.
Medicare does this — reimburses hospitals at above their marginal cost, but below their average cost, so that private insurers have to pick up most of the hospital overhead.
European countries do this with prescription drugs: reimburse above the marginal cost of producing the pills, but below the total cost of developing the pills, so that the US has to pick up most of the tab for drug development.
The problem is that as voters and as customers, we often get the notion that marginal costing can be extrapolated to everyone.
So liberal policy wonks want to save money by putting everyone on Medicare, or some equivalent program that uses the government’s monopsony pricing power to get lower prices for everyone.
But, it doesn’t work that way.
Everyone cannot be the marginal cost consumer.
Someone has to cover things like overhead and development costs.
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Posted in Economics, Marginal Costing | Leave a Comment »
September 29, 2011
Punch line: According to Gallup a record-high 81% of Americans are dissatisfied with the way the country is being governed
As Gomer Pyle would say “surprise, surprise, surprise.”
Ken’s Take Carter tanked it, Reagan brought it back, Clinton held it, Bush re-tanked it, Obama sqandered hope & change to all-time lows.
* * * * *
Drilling Down
Majorities of Democrats (65%) and Republicans (92%) are dissatisfied with the nation’s governance.
69% say they have little or no confidence in the legislative branch of government, an all-time high and up from 63% in 2010.
57% have little or no confidence in the federal government to solve domestic problems
43% have little or no confidence in the government to solve international problems.
53% have little or no confidence in the men and women who seek or hold elected office.
Americans believe, on average, that the federal government wastes 51 cents of every tax dollar
49% of Americans believe the federal government has become so large and powerful that it poses an immediate threat to the rights and freedoms of ordinary citizens.
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Tags: Dissatisfaction with Government, Gallup, Government Approval
Posted in Gov't Waste & Inefficiency, Government & Politics, Polls & Surveys | Leave a Comment »
September 29, 2011
According to the Domain Name Journal, Social.com sold for the highest price so far in 2011 ($2.6 million) … a mere pittance compared to the $13 million paid in 2010 for – you guessed it – Sex.com.
Below are the past 2010-2011 years top 10s … and links to the full lists.
Note: the lists are only domain names sold in the past 2 years … that’s different from “most valuable”.
DN’s Top 10 Domain Name Sales – 2011
DN’s Top 10 Domain Name Sales – 2010
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Posted in Internet - General, Internet Marketing - eCommerce - | Leave a Comment »
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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Tags: Ad campaign, Bailouts, Chicago-style politics, Ford
Posted in Autos - Travel, Obama | Leave a Comment »
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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Tags: Blame for the economy, Bush, Gallup, Obama
Posted in Economy, Obama, Polls & Surveys | Leave a Comment »
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.
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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Tags: Free, Netflix, Perils of Free, Quickster
Posted in Mktg - Free - Power, perils, Mktg - PLC, Mktg - Pricing | Leave a Comment »
September 27, 2011
Well, well, well.
According to the WSJ: “The SEC has given S&P a so-called Wells notice alleging that S&P violated federal securities laws with respect to its ratings for a collateralized debt obligation known as Delphinus CDO 2007-1”.
Hmmm. About 4 years after the fact … but only a month or so after S&P lower the U.S. credit rating.
Coincidence.
Probably so.
And, here’s another twist: Moody’s was also up to its eyeballs slapping AAA ratings on CDOs.
But, Moody’s isn’t under investigation.
Did I mention that Warren “Please Tax Me More” Buffet owns a big chunk of Moody’s.
Double hmmm.
Probably just a coincidence.
But, it doesn’t smell right, does it?
Gotta love that good, old fashioned Chicago politics.
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Posted in Buffett, Warren, Financial Crisis, Obama | 1 Comment »
September 27, 2011
In marketing jargon, it’s called “unbundled pricing” … charging a price for a base product and then charging separately for add-ons.
In concept, price unbundling allows suppliers to flash lower base prices to potential buyers … and enables buyers to only pay for the specific product features that they want.
The downside: unbundling highlights the price of the add-on … which folks may have previously perceived to be free. Think airlines charging for bags
Another case in point: a family member just got back from Europe …. where he was dismayed that McDonald’s was charging extra for ketchup.
For McDonald’s, it’s a way to to list a lower burger price.
For non-ketchup eater, it’s a way to save money … not paying the ‘hidden price’ for something that they don’t use.
For ketchup users?
Well, it certainly feels like Mickey D is screwing them.
Thanks to SMH for feeding the lead.
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Posted in Mktg - Pricing | 1 Comment »
September 26, 2011
Punch line: Chasing after a couple of thousand rich dudes seems like a wild goose chase to me.
I’m more concerned about the 50% of folks who don’t have any skin in the game … who pay no taxes and think other folks should pay more.
Old refrain: “Don’t tax you, don’t tax me, tax the guy behind the tree.”
Tax Policy Center analysis reported in The Atlantic …
76 million people won’t legally owe individual income taxes in 2011
The vast majority of this group is poor. They won’t owe individual income taxes because they won’t earn a lot of money to start, and various exemptions, like the earned income tax credit, will wipe out any tax liability … maybe even getting them a refundable credit – a check in the mail from the Feds.
Among families making more than $100,000, there will also be half a million tax units that will also pay no income tax.
And, 7,000 millionaires will pay no individual income tax.
How can that be?
Couple of ways:
- Tax-free income … think gov’t bonds
- Catastrophic losses … e.g. mansion gets wiped out by a hurricane, very high uninsured medical expenses
- Discretionary deductions … think charitable deductions
- Fraud and other shenanigans …
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Tags: millionaires, Rich, Taxes, Who doesn't pay income taxes
Posted in Buffett, Warren, Taxes | 3 Comments »
September 26, 2011
Punch line: You can register a dot-com domain name with GoDaddy for about 10 bucks.
For an additional $184,990, you’ll soon be able to register a “dot-brand” domain name like “.homa”.
Tempting, but I think I’ll wait until the price drops to $19.99
* * * * *
Excerpted from CnnMoney …
Trusty old Internet addresses we know and love — the .coms, .nets, .orgs — are about to get some new competition.
Way back in 2000, the organization decided to expand the domain-name system. Since then, it has gradually rolled out a handful of new domains, including the controversial .xxx domain that got the green light in March.
ICANN (the Internet Corporation for Assigned Names and Numbers) – the Global Internet regulator – is finalizing rules for a major expansion of “generic top-level domains,” that will clear the way for new offerings like .law, .coke or .nyc. Sites with those endings are expected to start rolling out late next year.
Experts think dot-brand sites will be a hit with major companies.
“The decision will usher in a new Internet age … a platform for the next generation of creativity and inspiration.”
In addition to marketing benefits, they could help on the security front: HSBC, for example, could tell customers that a purported HSBC site isn’t legitimate unless it ends in .hsbc.
But these benefits don’t come cheaply — or easily. ICANN charges at $185,000 per domain application, which Crawford says typically must include about 150 pages of policy documents.
Technical setup takes another $100,000 or so, he says, and upkeep can cost an additional $100,000 each year.
ICANN is slated to begin reviewing applications in November or December, and says that new domains should roll out in July 2012.
Thanks to MET for feeding the lead.
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Tags: Branding, Domain names, dot-brand, dot-com, ICANN, Internet
Posted in Internet - General, Internet Marketing - eCommerce - | Leave a Comment »
September 23, 2011
Headline: Pres. Obama hires, hangs with and pays off folks with “little or no credibility among grassroots businesspeople”
Interesting read with some notable snippets from Forbe’s: How The President Helped Kill Progressivism, Capitalism And Moderation
Obama’s progressivism is shaped by his fellow academics, who have enjoyed unprecedented influence in this administration, as well as closely aligned classes such as affluent greens, urban land interests, venture capitalists and the mainstream media.
Obama’s stimulus … largely missed the recession’s biggest victims: minorities, the working class and the young. The president instead chose to service the needs of organized constituencies such as public sector unions, large research universities and “green capitalists.”
Obama … has surrounded himself not with entrepreneurs but consummate crony capitalists — chief of staff Bill Daley (scion of the Chicago machine family), General Electric‘s Jeffrey Immelt and proposed Commerce Chief John Bryson, who has spent much time as a master manipulator for a large regulated utility.
These figures have little or no credibility among grassroots businesspeople. They are seen as being more adept at working the system than succeeding in the free market.
Ken’s Take: There won’t be a significant economic turnaround until business is on board. Period.
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Posted in Anti-business, Obama | Leave a Comment »
September 23, 2011
Takeaway: While irreverent, Keystone Light’s spokesidiot Keith Stone has won over a cult following… but, the campaign’s success begs the question about where the brand will go from here.
* * * * *
Excerpted from brandchannel.com, “Keystone Light Mull(et)s Next Steps for Pervy Pitchman Keith Stone”
“In developing the Keith Stone campaign, we wanted to literally bring the brand’s ‘Always Smooth’ essence to life in a way that is impactful and relatable to our Keystone Light drinker. We did this through the creation of an ownable brand hero, Keith Stone is the MC of Smoothness.”
Like the Old Spice Guy, the success of Keith Stone relies on a number of unpredictables.
First, there’s the “guy” himself …
The Keith Stone character aims to “elevate the key traits and values of Keystone Light at the core,” taking as its motto “Always Smooth” …
And yet, Keith Stone is extremely popular … When large numbers of Americans are dressing as your spokesperson for Halloween, it’s a pretty good sign you’re forming strong connections with your consumers …
Consumers identify with Keith “because, in many ways, [he] emulates characteristics of themselves. He’s easygoing and confident. He’s clever, resourceful and creative in unexpected ways. He’s lovably imperfect … He’s your laidback buddy who always has a 30-stone in tow.”
Keystone has extended the reach of its popular pitch man with additional virals and various tie-in partnerships.…
The brand uses the web to promote brand interaction through engagement with Keith’s fans, “his 21-34 year-old buddies who are looking for laughs across various content platforms” …
It’s impossible to assume Keith Stone would ever mature beyond his current self, which could pose a challenge for Keystone when it comes to growing its brand beyond the name recognition and “always smooth” positioning its locked down with the current campaign.
As for their pitchman’s future … “It’s been a fun ride and we are currently discussing the possibilities for the brand in the coming years.”
Edit by KJM
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Tags: Halloween, Keith Stone, Keystone
Posted in Mktg - Promotion | Leave a Comment »
September 22, 2011
OK, this poll cuts to the chase.
This is why many folks – me included – resist tax increases (oops, I mean ‘revenue increases’) … because there’s enough wasted money to pay for everything the gov’t needs to do … including debt reduction.
Interesting note: even liberal Dems who push hard for tax increases think that at least 45 cents of every dollar are wasted. … yet, they keep pushing for tax increases.
Huh?
According to Gallup:
Americans estimate that the federal government wastes 51 cents of every dollar it spends, a new high in a Gallup question first asked in 1979.
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Posted in Gov't Waste & Inefficiency, Polls & Surveys | 2 Comments »
September 22, 2011
TakeAway: Wendy’s remakes its hamburger, after 42 years, to boost sales and grow share in the fast food wars … New burger or New Coke? … The market will ultimately decide.
* * * * *
Excerpted from USAToday.com, “Wendy’s remakes its burgers; here’s how it did that”
Dave’s Hot ‘N Juicy, named after late Wendy’s founder Dave Thomas, is Wendy’s new burger — with extra cheese, a thicker beef patty, a buttered bun, and no mustard, among other changes …
“Our food was already good. We wanted it to be better. Isn’t that what long-term brands do? They reinvent themselves.”
Wendy’s started Project Gold Hamburger two and a half years ago to boost lackluster sales and fight growing competition from McDonald’s and expanding fast-casual chains, such as Five Guys …
But the biggest issue was that Wendy’s, which hadn’t changed its burger since the chain began in 1969, let its food offerings get stale over the years while its competitors continued to update their menus …
“We have a lot of catching up to do in some areas. But after we launch this hamburger there will be folks who need to catch up to us.”
Wendy’s polled more than 10,000 people about their likes and dislikes in hamburgers. It found that people like the food at Wendy’s but thought the brand hadn’t kept up with the times.
So, executives were shipped off to eat at burger joints around the country and measured each sandwich on characteristics like fatty flavor, salty flavor and whether the bun fell apart.
Then, it was time for Wendy’s researchers to consider the chain’s own burger, ingredient by ingredient. Each time they made a change, they asked for feedback, visiting research firms around the country to watch through two-way mirrors as people tried each variation.
Many suggestions sounded good but didn’t ring true with tasters.
- They tried green-leaf lettuce, but people preferred to keep iceberg for its crunchiness.
- They thought about making the tomato slices thicker but decided they didn’t want to ask franchisees to buy new slicing equipment.
- They even tested a round burger, a trial that was practically anathema to a company that’s made its name on square burgers.
Wendy’s ultimately did not go with the round shape, but changed the patty to a “natural square,” with wavy edges, because tasters said the straight edges looked processed.
Tasters said they wanted a thicker burger, so Wendy’s started packing the meat more loosely, trained grill cooks to press down on the patties two times instead of eight, and printed “Handle Like Eggs” on the boxes that the hamburger patties were shipped in so they wouldn’t get smashed.
Wendy’s researchers knew that customers wanted warmer and crunchier buns, so they decided that buttering them and then putting them through a toaster was the way to go.
In the end, Wendy’s researchers changed everything but the ketchup. They switched to whole-fat mayonnaise, nixed the mustard, and cut down on the pickles and onions, all to emphasize the flavor of the beef.
They also started storing the cheese at higher temperatures so it would melt better, … a change that required federal approval.
Wendy’s faces the reality that some customers may not like the new burger — or its likely price increase of 10 or 20 cents, because of the higher-quality ingredients.
Edit by KJM
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Posted in Food & Drink, Mktg - Consumer Behavior, Mktg - Product & Innovation | 1 Comment »
September 21, 2011
The press were abuzz yesterday debunking O’s key premise that millionaires pay taxes at a lower rate than teachers making $50,000.
Yesterday, we showed that a married teacher with 2 kids who earns $50,000 pays at a 5.5% rate. Even if you add 7.65 in payroll taxes to that, the resulting 13.15% is still less than a millionaire who pays only capital gains taxes at 15%.
That was a micro analysis.
The WSJ presented the macro analysis:
In 2008, the last year for which such data are available, the IRS reports that those who made more than $1 million in adjusted gross income paid an average income tax rate of 23.3%.
That’s slightly lower than the 24.1% rate paid by those making between $500,000 and $1 million, probably because the richest are like Mr. Buffett and earn more from capital gains and dividends.
The rate for a relative handful of the rich — 400 people — fell to 18%.
But nearly all millionaires still paid a rate that is more than twice the 8.9% average rate paid by those earning between $50,000 and $100,000, and more than three times the 7.2% average rate paid by those earning less than $50,000.
The larger point is that the claim that CEOs are routinely paying lower tax rates than their secretaries is Omaha hokum.
I think the President should modify his Buffett Rule to read: anybody who earns more than $1 million … and who has accumulated wealth greater than $25 billion … and who plans to bequeath practically all of his estate to a pal’s “foundation” shall pay an effective income tax rate of 90% … unless he /she whines that they’re being coddled, in which case the tax rate escalates to 100%.
My real recommendation: limit the charitable estate exemption to $1 million so that Buffet has to fork about half of his estate over to the government … that’ll keep him from bring coddled in the grave.
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Tags: billionaires, Buffett, Buffett Rule, millionaires, Taxes
Posted in Buffett, Warren, Obama, Taxes | 1 Comment »
September 21, 2011
Last week, Speaker Boehner spoke about the Obama’s Jobs Plan and the state of the economy”
House Speaker John Boehner said President Barack Obama’s jobs plan would do little to get the economy moving again because “job creators in America are basically on strike.” Source
Well, we told so … going back to a July 2009 post titled: “Why private sector jobs won’t be coming back any time soon … hint: it’s called passive aggressive resistance.”
Back then, we were saying:
The bottom line: businesses will resist government policies passive aggressively.
Fewer jobs will get added back than history would suggest, and those that get added back will materialize later than past patterns. Businesses will add jobs as a last resort rather than trying to build capacity ahead of the economic growth curve.
Why should companies increase their costs and risks any more than is absolutely necessary ?
Companies will continue to off-shore jobs, but will be more clever and clandestine about it, e.g. by vertically disintegrating and simply buying goods and services from 3rd parties.
Given the Administration’s anti-corporate rhetoric, actions, and proposed game-changing rules, I doubt that many CEOs will be taking on added costs and risks to boost the administration.
More likely, they will let unemployment continue to creep up, and will slow roll the process of rehiring.
Corporate chieftains will sit back and watch the President squirm and spin his “4 million jobs – saved or created”.
As Rev. Wright would say “the chickens will have come home to roost”.
Passively aggressive resistance at its very best.
There’s more in the original post.
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Tags: Boehner, Employers on strike, Jobs, unemployment
Posted in Jobs - Unemployment | 1 Comment »
September 20, 2011
The AP published a nice summary of the Solyndra fiasco. Here are some highlights …
* * * * *
Projected Losses
Solyndra was hemorrhaging hundreds of millions of dollars for years before the Obama administration signed off on the original $535 million loan guarantee in September 2009.
The company’s SEC filings outlined losses prior to the loan and said bluntly: “We expect to continue to incur significant operating and net losses and negative cash flow from operations for the foreseeable future.”
“We have incurred significant net losses since our inception, including a net loss of $114.1 million in 2007, $232.1 million in 2008 and $119.8 million in the first nine months of fiscal 2009, and we had an accumulated deficit of $505 million at Oct. 3, 2009,” the company said in a December 2009 filing to the SEC. “We expect to continue to incur significant operating and net losses and negative cash flow from operations for the foreseeable future.”
The DOE brushed off the losses, saying: “Of course start-up companies incur early losses.”
But, the company said: “ … net losses and negative cash flow from operations for the foreseeable future”.
Hard to brush that off.
* * * * *
Subordination of Gov’t Loan
When Solyndra started imploding earlier this year, “The Obama administration restructured the half-billion dollar federal loan to Solyndra in such a way that private investors — including a fundraiser for President Barack Obama — moved ahead of taxpayers for repayment in case of a default, government records show.
The Administrations defense:
Administration officials defended the loan restructuring, saying that without an infusion of cash earlier this year, solar panel maker Solyndra Inc. would likely have faced immediate bankruptcy, putting more than 1,000 people out of work.
Even with the Administration’s agreement to subordinate the gov’t loan to private creditors, Solyndra filed for Chapter 11 bankruptcy protection a few months later and laid off its 1,100 employees.
Remember the auto bailouts when the Administration subordinated secured creditors beneath the unsecured union obligations?
I guess the new rules are simply that Obama supporters get priority claims in bankruptcy proceedings …
* * * * *
Political jitters
Emails show the White House was worried about the likely effect of a default by Solyndra on Obama’s re-election campaign.
“The optics of a Solyndra default will be bad,” an OMB official wrote in a Jan. 31 email to a colleague. “The timing will likely coincide with the 2012 campaign season heating up.”
The budget official, whose name is blacked out in the email, wondered whether Solyndra should be allowed to restructure its loan.
“Questions will be asked as to why the administration made a bad investment, not just once (which could hopefully be explained as part of the challenge of supporting innovative technologies), but twice (which could easily be portrayed as bad judgment, or worse),” the email says.
News flash: even without a 2nd round of money down the rat hole, the gov’t loan guarantees reads through as “bad judgment, or worse”.
* * * * *
Ken’s big question
Why hasn’t anybody been fired?
If DOE’s head Steven Chu – you know, the Nobel winning scientist — signed off on this loan guarantee, he should be terminated immediately.
That’s what happens to in private VC firms when a partner loses a half-billion dollars in 18 months on an indefensible investment.
P.S. I don’t think Chu’s Nobel prize was for either oil spill remediation or high tech venture capital work. If I’m wrong, let me know.
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Posted in Obama Scandles, Stimulus Plan | Leave a Comment »
September 20, 2011
We’re talking internet speeds, of course.
According to the NY Times. download times are fastest in Rhode Island and slowest in Idaho.
Here’s the rack up of fastest and slowest …
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September 19, 2011
In his speech, the President’s teleprompter hammered that millionaires and billionaires have lower tax rates than teacher’s making $50,000.
Hmm.
Let’s think about that.
A high earner who makes all of his money from dividends and capital gains pays 15%. Maybe a tad less after deductions – but the deductions (charity, state & local taxes, mortgages) should be rounding error. So, let’s call it 15%
What about a teacher earning $50,000 – all from his teacher’s pay?
Well, let’s assume that he’s married with 2 kids.
What does he pay in taxes?
Answer: 5.5%.
A married person filing jointly gets a standard deduction of $11,400
A married taxpayer with 2 kids gets $14,600 in exemptions (4 times $3,650)
So, the taxpayers taxable income is $24,000 ($50,000 less $11,400 less $14,600)
Taxes on $24,000 are $2,762.50 ($1,675 plus 15% of the taxable income over $16,750)
That’s an effective rate of 5.5%
You see, the standard deduction and exemptions are what analysts call statistically significant.
Come on Mr. President … at least get the numbers right !
* * * * *
Relevant Tax Facts
http://www.irs.gov/pub/irs-pdf/i1040tt.pdf
Exemptions directly reduce your taxable income. You are allowed a personal exemption for yourself, your spouse if married filing jointly, and each person you can claim as a dependent. For 2010, the exemption amount is $3,650.
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Tags: Buffet Rule, Obama, Taxes
Posted in Taxes | 5 Comments »
September 19, 2011
As many MSB MBA alums know, the Homa Notes summarize many of the concepts, frameworks and analytical methods that are the foundation of my courses.
For the convenience of MSB students, alums, and friends of the school, the Homa Notes are accessible via the Homa Files blog.
The notes are password protected.
For the password, email Prof. Homa homak@georgetown.edu
Here is the current set of notes:
01 HomaNote – Marketing Overview
02 HomaNote – Product Fundamentals
03 HomaNote – Pricing Fundamentals
04 HomaNote – Place (Distribution)
05 HomaNote – Promotion & Advertising Fundamentals
06 HomaNote – Marketing Performance
Warning: While the Homa Notes are relatively comprehensive, they are incomplete without Prof. Homa’s accompanying oral elaboration.
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September 19, 2011
Punch line: Ford hit the airwaves with a potentially controversial ad touting the fact that it’s an American company that stands on its own … unlike its bailed out competitors.
I like it …
Excerpted from US News: Ford TV Ad Slams Obama Auto Bailouts article & video
America is still fighting over President Obama’s costly bailout of Chrysler and General Motors. Especially the owners of Ford, the only member of Detroit’s “Big Three” who rejected the government dole and emerged perfectly healthy.
In its most political ad in the so-called “Drive One” ads where real drivers are thrust before cameras to explain why they picked Ford, a real Ford F-150 pick-up driver is featured.
His name is Chris. After he sits down the “reporters” bark “Chris, Chris.” One asks him to explain why “was buying American important to you.”
Sitting and looking sincere and serious, Chris says:
“I wasn’t going to buy another car that was bailed out by our government.
I was going to buy from a manufacturer that’s standing on their own: win, lose, or draw.
That’s what America is about is taking the chance to succeed and understanding when you fail that you gotta’ pick yourself up and go back to work.
Ford is that company for me.”
Now, let’s see if Chris the Ford buyer gets tax audited like Joe the Plumber …
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Posted in Autos - Travel, Mktg - Promotion | Leave a Comment »
September 19, 2011
Punch line: Georgetown’s Big East Conference may be losing its 4th and 5th teams to the ACC … whacking the Big E’s stature and money-making capacity.
Georgetown is caught in a pickle since it’s a ‘major’ in basketball but not in football.
Excerpted from WSJ
The Atlantic Coast Conference has received application letters from Pittsburgh and Syracuse to join the league.
If the move goes forward, Pittsburgh and Syracuse would become the fourth and fifth schools to leave the Big East for the ACC in the past decade. Virginia Tech and Miami joined in 2004, and Boston College followed a year later as the ACC’s 12th member.
Syracuse is a founding member of the Big East, and Pittsburgh joined the league in 1982.
The Big East’s situation is tricky because of seven non-football members such as Georgetown and Villanova that help make it one of the nation’s strongest basketball conferences.
The basketball schools and football schools often have different agendas.
Losing Pitt and Syracuse would be a huge blow to Big East basketball as well as football.
The other football-playing members of the Big East are Rutgers, Connecticut, Louisville, South Florida, Cincinnati and West Virginia.
There already has been speculation that West Virginia would be a target for the SEC
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Tags: ACC, basketball, Big East, Georgetown
Posted in Big East, Georgetown, Sports & Athletics | Leave a Comment »
September 16, 2011
No surprise, but the President’s Son-of-Stimulus plan seems to have fallen on deaf ears.
According to Gallup, after a week of selling the plan, Obama’s approval rating is back below the 40% political Mendoza line …
I guess the attempted political coup of serving up a plan that stood no chance of being passed didn’t fool folks.
Hot surprised …
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September 16, 2011
Flamethrowers from the right and left respectively (not respectfully)
Glenn Beck is running promos for his new vid show via his internet site.
Big step down from early prime on Fox and thousands of followers on the DC mall.
Olbermann has set up shop at Current TV – whatever that is.
Step-down from MSNBC … though viewership there was pretty low, too.
Question of the day: anybody miss either of them?
I sure don’t …
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September 16, 2011
TakeAway: New ultra-low calorie products celebrate America’s love of over-indulgence … They give folks ‘normal’ portions with fewer calories.
About the taste? You decide …
* * * * *
Excerpted from courier-journal.com, “Marketing to your inner glutton: Ultra-low-calorie foods allow bingeing without guilt”
There is a recent wave of ultra-low calorie products — such as, Artic Zero’s 150-calorie per pint dessert Artic Zero, 20 calorie per serving Tofu Noodles, and MGD 64, a 64 calorie beer — are aimed to direct appeal to our national sense of gluttony …
“What we’re seeing here is a strategy that says Americans like to stuff their faces … And these mean we don’t have to sacrifice.”
“It’s fine to eat one serving of ice cream, but I can’t remember the last time I sat down with a pint and ate half a cup,” said the CEO of Arctic Zero., whose pints of “ice cream replacement” prominently feature the 150-calorie message. “We feel like a serving is an entire pint.”
Tofu Shirataki noodles from House Foods America., offers two 20-calorie servings per 8-ounce package, but “most people eat the whole bag for a meal,” said Yoko Difrancia, the company’s marketing supervisor. “The whole bag is more realistic.”
Consumers seem to be buying it. Sales of Arctic Zero, introduced in 2009, have grown 15 to 20 percent per month for the past 18 months … ‘
“The idea is not that you can or should eat a much bigger volume than you typically
do,” Penn State Professor Barbara Rolls said. “It’s that if you eat your usual amount, you’re going to feel full but with fewer calories.”
… Health advocates and dietitians remain committed to the idea that portion sizes must come down. But they say these products could offer baby steps to people struggling to control their weight. They might also be useful when you feel that binge coming on …
Edit by KJM.
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Posted in Health & Nutrition, Mktg - Product & Innovation | Leave a Comment »
September 15, 2011
Talking AGT, of course.
What a disappointment.
First, the 2-hour results funale show.
Boring. Filled with real celebs performing with each of the final acts. Had a certain thrown-together-in-a-day look to it. I guess that’s because it was thrown together in a day.
And then, the results …
The guy does a nice job crooning Sinatra, but get serious. There are already at least a dozen Sinatra impersonators in Vegas. He’ll fade fast.
Silhouettes will get some great gigs … and will inspire many copycat acts.
Team iLuminate will be big in Vegas — most unique act since the Blue Men.
Enough on AGT …
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Tags: AGT, America's Got Talent, Silhouettes, Team iLuminate
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September 15, 2011
Punch line: Chipotle Chipotle has contributed more than $2 million to initiatives that support sustainable agriculture,
It’s latest effort: an animated video featuring Willie Nelson’s cover of Coldplay’s “The Scientist” that highlights the importance of a sustainable food ecosystem.
* * * * *
Excerpted from brandchannel.com, “Chipotle score sustainable hit with Willie Nelson’s Coldplay cover”
Featuring a cover of Coldplay’s The Scientist by Willie Nelson, the two-minute animated short, “Back to the Start,” follows a farmer who turns his family business into an industrial animal factory, but sees the light and reverts back to a more sustainable approach…
Available on iTunes, this song sells for 99 cents, with 60 cents going toward the Chipotle Cultivate Foundation, which supports family farms, and is sponsoring the first Cultivate sustainable food festival, a free event uniting “food, farmers, chefs, thought leaders, and musicians.”
To date, Chipotle has contributed more than $2 million to initiatives that support sustainable agriculture, family farming and culinary education including: The Jamie Oliver Food Revolution, the Lunch Box, the Nature Conservancy and Veggie U, Niman Scholarship, Culinary Institute of America, The Land Institute, and FamilyFarmed.org.
Edit by KJM.
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Tags: Chipotle, Ecosystems, Sustainability, Willie Nelson
Posted in Causes, Cause Marketing | Leave a Comment »
September 15, 2011
Punch line: Along with Obama’s Son-of-Stimulus comes a provision to prohibit discrimination based on a job applicant’s unemployment status … that is, whether they are currently unemployed or have had gaps in their work record.
Excerpted from Wash Post: “Bill to protect unemployed job applicants could hurt employers”
With no more pressing priority in Congress than creating jobs, the House and the Senate recently proposed near-identical versions of the Fair Employment Opportunity Act of 2011 to prohibit discrimination based on a job applicant’s unemployment status.
The proposals prohibit considering the present or past unemployment of employee candidates.
And, the proposals severely restrict an employer from inquiring into gaps in the work history of employee candidates — standard fare for any job interview.
Certainly, in a bad economy there are millions of Americans who are unemployed through no fault of their own.
But in good and even troubled economic times, long bouts of unemployment may bespeak a bad work ethic or some other improper behavior — a legitimate consideration for any employer.
Simply put, the potential unintended consequences of Congress’s proposal may exacerbate the disease that members of Congress so desperately seek to cure.
You just can’t make this stuff up …
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Tags: Discrimination, Gov't Policies, Jobs, Regulations
Posted in Employment - Jobs | Leave a Comment »
September 15, 2011
Interesting retro piece republished by the Daily Beast …
Punch line: Famous quote from some dude in the patent office: “all things have already been invented”
Tom Watson, IBM CEO of long ago, predicted at most 6 computers would be bought.
And, in 1995, Newsweek stepped forward to declare the internet “nothing but a bunch of hype”.
Oops.
Excerpted from Newsweek: The Internet? Bah!, Feb 26, 1995
Hype alert: Why cyberspace isn’t, and will never be, nirvana
After two decades online, I’m perplexed. It’s not that I haven’t had a gas of a good time on the Internet. I’ve met great people and even caught a hacker or two.
But today, I’m uneasy about this most trendy and oversold community – the internet.
Visionaries see a future of telecommuting workers, interactive libraries and multimedia classrooms. They speak of electronic town meetings and virtual communities.
Baloney. Do our computer pundits lack all common sense?
The truth in no online database will replace your daily newspaper, no CD-ROM can take the place of a competent teacher and no computer network will change the way government works.
How about electronic publishing? Try reading a book on a computer. At best, it’s an unpleasant chore: the myopic glow of a clunky computer replaces the friendly pages of a book. And you can’t tote that laptop to the beach.
Yet Nicholas Negroponte, director of the MIT Media Lab, predicts that we’ll soon buy books and newspapers straight over the Intenet.
Uh, sure.
The Internet is one big ocean of unedited data, without any pretense of completeness.
Lacking editors, reviewers or critics, the Internet has become a wasteland of unfiltered data.
Then there are those pushing computers into schools.
We’re told that multimedia will make schoolwork easy and fun. Students will happily learn from animated characters while taught by expertly tailored software. Who needs teachers when you’ve got computer-aided education?
Bah.
Can you recall even one educational filmstrip of decades past? I’ll bet you remember the two or three great teachers who made a difference in your life.
Then there’s cyberbusiness.
We’re promised instant catalog shopping — just point and click for great deals. We’ll order airline tickets over the network, make restaurant reservations and negotiate sales contracts. Stores will become obselete.
So how come my local mall does more business in an afternoon than the entire Internet handles in a month?
Even if there were a trustworthy way to send money over the Internet — which there isn’t — the network is missing a most essential ingredient of capitalism: salespeople.
What’s missing from this electronic wonderland?
Human contact.
Discount the fawning techno-burble about virtual communities.
Computers and networks isolate us from one another.
A network chat line is a limp substitute for meeting friends over coffee.
A poor substitute it is, this virtual reality where frustration is legion and where — in the holy names of Education and Progress — important aspects of human interactions are relentlessly devalued.
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Tags: eBooks, Education, Fads, Internet
Posted in Internet - Soc Networking, Internet Marketing - eCommerce - | 3 Comments »
September 14, 2011
Punch line: Many execs say “you can’t cost reduce yourself to success”.
Apparently, Sen. Claire McCaskill agrees and looks to marketing to save the USPS from its financial woes.
* * * * *
U.S. Senator Claire McCaskill is a big supporter of the United States Post office.
McCaskill is against closing costly, non-essential post offices.
She thinks the USPS can market its way to success.
“I had an opportunity to go through a box of letters that my mother had from my grandmother’s house that were my letters I sent to her in college … My kids are in college now — I don’t have a box like that.”
Rather than cost-cutting, McCaskill is has suggested a marketing campaign stressing the “value of the written letter.”
Might work …
You just can’t make this stuff up.
* * * * *
Click to see the video
Thanks to Tags for feeding the lead.
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Posted in Mktg - Laughs & Disses, Mktg - Market Development | Leave a Comment »
September 14, 2011
A month ago, we blogged why hiring incentives are a bad idea.
Apparently the stumblebums at the White House don’t follow the HomaFiles.
Last week, one of the globs that Obama threw against the wall was a one-time $4,000 tax credit for every person hired – provided that they’d been unemployed for at least 6 months. .
At first blush, it sounds like a good idea.
But it’s not.
First, no sensible employer is going to make incremental hires for a single year of benefits. If they do, there are equal odds that they’ll jettison the employees when the waiver expires.
More important, the program punishes “responsible” companies by rewarding hard-hearted ones.
Let me explain.
Say, company A laid off 20% of its workforce during the recession – largely due to the business slowdown, but also the result of opportunistic house-cleaning – getting rid of slackers and dolts.
Comparable company B laid off a couple employees due to the downturn, but – took its lumps – and kept most of its employees on the payroll, even though many weren’t really needed.
Along comes the hiring incentive.
Which company gets it?
Yep, company A – the company that shed employees.
What does company B get for standing by its employees.
Nothing.
Sound fair to you?
Sounds like punishing responsible behavior … again!
And, the program is likely to encourage dysfunctional behavior.
For example, now that the idea has been proposed … why in the world would any company hire employees until the legislation is either passed or killed?
My bet: there will be a marginal decrease in hiring as companies wait and see.
Further, ruthless companies may start forcing attrition among recent hires, in order to replace them with tax-incentivized folks off the unemployment rolls.
Net gain: zero.
Behavioral note:
How can they force attrition?
Easy.
Just start assigning low seniority employess undesirable work schedules, e.g. split shifts
Most often, companies won’t step-up their hiring, they’ll just bag the tax credit for folks they were going to hire any way ((think Cash for Clunkers and Home Buying Credit).
In marketing parlance, it’s called “dilution”.
Never ceases to amaze me how naïve the Administration is re: how businesses work …
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Posted in Employment - Jobs, Stimulus Bill | Leave a Comment »
September 13, 2011
Team iLuminate will win, but there’s going to be controversy.
First, Team iLuminate — one of my favs — knocked it out ot the park with their techno dance routine. Unbelievably clutch performance.
But, Silhouettes– the artsy shadow dancers — didn’t get a a fair shot.
There were tech problems on the live show, so their act was delayed — while techies fixed the problem.
It’s reported that the large back doors of the stage wouldn’t open, so the crew couldn’t get Poplyfe’s set off the stage.
Silhouettes didn’t get the emotive run-up that other acts got — no poor neighborhood, no disease, no nothin’.
Finally they got hustled to the stage,
But, on my cable system, about 30 seconds of their 90 second act was blacked out.
Great beginning and GREAT ending, but no middle … not their fault — NBC’s.
Ouch.
Update: The plot thickens.
Apparently the blackout isse was localized and only indirectly lrelated to the tech set-up problem.
I was watching a Baltimore NBC affiliate via Comcast-Annapolis. Part of Silouettes’ performance was blacked out.
I’ve gotten reports that the full performance was visible on DirecTV.
My hypothesis: I didn’t realize it at the time, but NBC let the show run into the 10 o’clock time slot.
I’m betting some local affiliates didn’t get the word and tried to switch to local commercial content … causing a temporary disconnect … a blackout.
Quickly corrected … but still part of the performance was blacked out.
Raises another issue: for folks DVR’ing the show — rather than watching live — most or all of Silouhettes’ performance wasn’t recorded — since the show ran unexpectedly long.
That’s a problem, too.
Some part of AGT’s regular audience might not of even seen Silouhettes’ performance.
What a mess.
Biggest TV problem for NBC since they swithced from a close football game to Heidi-the-movie in 1968.)
My opinion: other 2 acts weren’t close to iLuminate (video) or Silhouettes (video).
So, what’s NBC going to do?
Fair thing: name co-winners: Team iLuminate & Silhouettes.
But, NBC will just go with the vote, and Team iLuminate wins.
You heard it on the Homa Files first,
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Tags: AGT, America's Got Talent, Controversy, NBC, Silhouettes, Team iLuminate
Posted in Entertainment | 2 Comments »
September 13, 2011
Punch line: Obama performance is now approved by about 1 in 3 whites and only 1 in 2 Hispanics … still holding strong with blacks.
According to Gallup …
“President Barack Obama earned the lowest monthly job approval rating of his presidency to date in August, with 41% of U.S. adults approving of his overall job performance, down from 44% in July.
He also received term-low monthly job approval ratings from both Hispanics (48%) and whites (33%) and tied his lowest rating from blacks (84%).
Note: All data is pre-jobs speech.
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