Thursday, June 30, 2011

Face Recognition Is Facebook's Latest Privacy Battleground

Facebook just can't seem to strike the right balance between useful features and privacy protection. It recently inaugurated a new feature that has privacy advocates seeking regulatory response in the US and in Europe.
The feature is auto photo face recognition. It works like this: When a Facebook user uploads a photo, the system "recognizes" the face(s) and suggests which name(s) to tag in the photo. Facebook will allow mass tagging, as well. In fact, Information Week says that Facebook is creating a database of user images linked to names.

Face recognition can be a very valuable feature in photo management software such as Google's Picasa, for example. Incorporating it into social networking via Facebook is another thing entirely.

Facebook allows users to turn off the setting allowing photo tagging, and it offers a "new suite of safety tools." But when it comes to privacy, FB moves to the beat of a different drummer.

By this time, FB may have disabled the feature because of the firestorm of protest. If not, you can turn off the face recognition tagging feature by logging into FB and clicking as follows:

Account > 

Account Settings > 

Privacy > 

Customize Settings > 

Things Others Share 

Click to disable "Suggest photos of me to friends."

Monday, June 27, 2011

Electric Cars Picking Up Speed

The all-electric, plug-in Nissan Leaf and its US rival, the Chevy Volt, have had a lot of positive publicity during the past year. Recent spikes in gas prices have only intensified interest in cars that run on anything other than gas.

USA Today, reporting on the "electric cars war," concluded that sales of the Leaf and the Volt are nearly tied. Of course, Nissan and Chevy are busy promoting their electric advantages and responding to each other's ad claims.

One big question mark is how quickly the infrastructure will develop to accommodate plug-in cars. What's a buyer to do if he or she drives somewhere but can't recharge for the return trip? Go to Qwest Field in Seattle, for instance, and you can recharge. If you commute to Google in a plug-in car, you're also in luck.

Yet Business Week observes that early Leaf buyers aren't receiving their vehicles on time--and Nissan is canceling some orders, even though a number of these buyers want to follow through. Delays in Leaf production are partly to blame, but competing vehicles such as the Volt may also be nicking customers from the waiting list. Will Nissan achieve its long-term goal of having electric cars such as the Leaf account for 10% of global sales by the end of this decade?

Thursday, June 23, 2011

3D--What Next?

Not so long ago, adding two letters to a movie--3D--seemed to be the way to justify premium pricing and boost box-office receipts in a hurry. Avatar helped fuel that phenomenon, adding to the anticipation of not only the movie but also the 3D experience.

Today, 3D isn't an automatic win. In fact, some would-be blockbuster movies haven't fared all that well in 3D. Still, 3D TV is gaining momentum (slowly), and 3D digital games have been called the way of the future.

Now 3D ads are arriving in a kitchen, building, or billboard near you. Nestle's entry is an "augmented reality" bird based on the Rio movie, cut out from a box of Chocapic cereal. The Lexus 3D billboard (above) is actually a projection on the Hotel Roosevelt in California. Watch for more 3D excitement anywhere and everywhere--until the 3D excitement becomes part of everyday life and a ho-hum response pushes marketers to look for the next new thing.

Tuesday, June 21, 2011

After Fads Fade: Silly Bandz Looks Ahead

Silly Bandz (once ubiquitous on the arms of kids and young adults alike) have come and gone in the US, but they're still somewhat popular elsewhere. After the craze peaked last year, Silly Bandz continued to crank out new bands in timely shapes, such as Angry Birds (see above).

The Wall Street Journal asked Robert Croak, Silly Bandz's founder, what happens after this fad fades. "The goal is to become a lifestyle brand of fun, innovative new fashion products that kids can buy for under $20," Croak told the WSJ reporter. He's introduced some inexpensive items like slap-bands (remember those? everything old is new again) and necklaces. Even if these never reach the heights that Silly Bandz reached, Croak may do well if he can keep a small percentage of his customers loyal.

Croak understood that the most optimistic outlook couldn't keep Silly Bandz going strong forever. That's why his marketing plan included development of new products even as his original line was still popular.  Good marketing move!

Friday, June 17, 2011

Will Today's Social Media Super-Stars Go Nova?

Will Twitter and Facebook go the way of Netscape, Altavista, and other e-brand stars that once burned brightly in the Internet universe, only to go nova over time? 

  • AltaVista was an up-and-coming search engine developed by Digital Equipment Corp, one of the speediest and most popular in its heyday--until Google came along and stole the spotlight. Today, AltaVista is owned by Yahoo! but the site is quite bare-bones. If you "Google" AltaVista, fewer than 22 million results show up.
  • Netscape Navigator, once the premier Web browser, was bought by AOL in 1999. AOL (a former big-shot brand that's fallen from its own great heights) ended its support of Netscape in 2008. Now Netscape is simply one of AOL's miscellaneous brands. Ask a teenager what Netscape is (as I did not long ago) and you'll get a blank stare or a one-word answer: "Huh?" When I "Googled" Netscape, only 116 million results showed up--five times more hits than AltaVista, but still not much of a presence.
These two has-been e-brands have clearly been eclipsed by newer e-brands. For example, do a Google search on some of today's top e-brand and social media super-stars, and here's what you get:
  • YouTube= 597 million results
  • Google = 9.3 billion results
  • Twitter = 9.4 billion results 
  • Facebook = 11.7 billion results
Although Facebook has 2 billion more results than Google, that's what things look like today. Given the enormously rapid rate of change in all things Internet, tomorrow's results could look very different. 

My prediction is that Twitter will fade before Facebook . . . and Facebook will be eclipsed within a few years by some yet-unknown super-star e-brand that's the brainchild of a born-digital entrepreneur writing code at this very minute. 

Monday, June 13, 2011

Target Looks Northward, Targeting 2013 Reopenings

Minneapolis-based Target, which has a reputation for style at a popular price point, is having a hard time these days. Same-store sales are up, but only a bit, as "value-conscious" US shoppers pinch pennies while the economy remains stalled.

The Wall Street Journal recently questioned whether Target is losing its cachet, a problem because that's a major point of differentiation when the retailer faces off against Walmart and other discounters. 

Still, Target sees growth opportunity in Canada, where it's converting 105 former Zellers stores into Target stores. They're currently operating with the Zellers format but by 2013, all the stores will be renovated and reopened as Target branches, giving the company a sizable presence in all 10 Canadian provinces. The Canadian flagship store, also opening in 2013, will be in Toronto's west end.

Canadian shoppers are sure to give Target a try, given the retailer's reputation and its popularity with shoppers who cross the border. Will its Canadian stores restore the chain's cachet and reenergize North American sales?

Friday, June 10, 2011

Ford's Big Sales Push with Little Cars

Ford has set an ambitious new goal: To increase worldwide sales to 8 million vehicles per year by 2015. Given the current state of the global economy, and the high price of gas, increasing sales from 5.3 million today to 8 million in only 4 years seems like a stretch, despite Ford's profitable situation. If Ford can achieve this goal, however, it will catch up to long-time rival Toyota.

The BBC quotes Ford's CEO as saying:

"Clearly the highest growth rates will be in Brazil and Russia and in India and in China. China's really exciting because in the next few years, we're going to go from the 5 vehicles we have in China up to 15 vehicles."
This week, Ford announced its plan to double output in Russia, with a local partner. In India, Ford will expand the number of models being marketed from 3 to 8. Also, the global sales push will contribute to the planned hiring of thousands of US workers in the coming years.

One part of Ford's sales push sounds particularly smart: By the end of this decade, it expects that 55% of its worldwide sales will come from small cars, up from 48% of global sales today. Lots of buyers who worry about prices and/or the environmental impact of vehicles are steering toward smaller cars, where Ford is going to grow.

Ford's social-media marketing is in the fast lane with Scott Monty at the wheel, an important plus for targeting younger buyers. The automaker is very active on Facebook (including a separate page for electric vehicles), Twitter, YouTube, and other social media. Even so, can it reach its 2015 goal?

Monday, June 6, 2011

Retail Apple Envy

The retail battle between computer brands is currently running in favor of Apple--and competitors are envious. Trends in distribution can change at the click of a mouse, but in recent years, Apple's showy retail stores have drawn crowds and brought the company big profits, even in the midst of uncertain economic times.

Over the years, the top computer brands have handled distribution in different ways:
  • Dell originally restricted its distribution to direct customer contact only, which boosted profit margins and ensured control over the customer experience. No wonder Dell was considered a model of marketing excellence. Later, as competition intensified and volume expanded, Dell dabbled in retail "kiosks" that displayed but didn't sell its merchandise. Finally, Dell closed the kiosks and launched into more traditional retail distribution via established channels such as electronics chains and value-added resellers. It still sells the vast majority of products directly (through its Web site, Twitter, catalog, etc.), and its latest profit picture looks positive.
  • Hewlett-Packard has a history of embracing established retail distribution and VAR channels, as well as direct sales (especially to corporate clients). At the height of Dell's sales and profit ascendancy, HP briefly emulated its rival in emphasizing direct marketing to consumers--but then shifted focus toward mainstream retailers such as Best Buy and Walmart, channel partners that bring their own brand strengths and customer base to the mix.
  • Gateway (remember its cow colors?) began as a direct marketer and, by the late 1990s, was operating retail showrooms across the U.S. The ill-fated retail chain was costly and, although the aim was to increase customer contact with the brand and boost sales, the dot-com bust caused PC sales to plummet. Gateway closed some stores little by little and, while Apple's glitzy stores were overflowing with customers, all of Gateway's stores were gone by 2005. Gateway had acquired eMachines in 2004, but eMachines was itself acquired by Acer in 2007.   
Apple opened its stores in 2001 as an extension of the brand experience, a way to allow shoppers to browse, try, and buy Apple products in a retail atmosphere representative of the brand experience. Everything--from the Genius Bar to the back-pack bags--drips with Apple's design expertise and reinforces the innovative style-with-functionality for which Apple is famous.

Today, Apple has 300+ stores worldwide that are often jammed with customers waiting their turn to test out an iPad or talk with a Genius Bar genius about some glitch. Apple does sell direct, and through selected distributors, but its stores are wildly popular with customers who want to hold a product in their hands and take it home right after the purchase.

Until the distribution pendulum swings the other way, Apple is clearly winning the retail battle in the computer space.

Friday, June 3, 2011

PBS + Mid-Program Ads = Uproar

The New York Times recently reported that the Public Broadcasting Service will begin airing sponsored spots in the middle of programs, rather than restricting such spots to the start and finish.

Although this is a change from PBS tradition, some people are unhappy about the creeping commercialization of public broadcasting, while others observe that the change is one of timing, not one of sponsorship acknowledgement (which the network already airs). Like so many broadcast networks, PBS plans to start a new program directly after the previous one ends, eliminating the "commercial well" that once separated programs.

Not surprisingly, this change has provoked protest. However, PBS, like its broadcast counterparts, is not immune to economic pressures, which accounts for the change.

And its brand is well-known and respected, which is why PBS is moving into new areas and social media to serve its audiences and expand its reach.

For instance, PBS has launched an iPad app to allow users to view 1,000 of the network's kiddie programs. 

Its Facebook page has more than 750,000 likes. Its Twitter account has more than 780,000 followers (and some 11,000 tweets). Its YouTube channel has more than 97 million upload views. Blogs? Many, aggregated on one page for easy viewing and audience engagement.

So PBS is doing everything it can to remain relevant to its audiences, offer valuable content, and earn viewership in multiple media. Whether the relocated sponsorship spots will irritate loyal viewers remains to be seen.

Wednesday, June 1, 2011

Milton Friedman Was Right (For the Wrong Reasons)

A new study by academic experts at Tuck shows that social responsibility can strengthen customer loyalty--if the program affects the customer experience. Intuitively, this makes sense: Customers, employees, stockholders, and suppliers prefer to associate with companies and brands that do good things (save the planet, raise money for good causes, buy local products). Other studies and surveys have also found that customers like buying from companies that make a difference.

A number of studies and meta-analyses have confirmed the positive link between social responsibility and profitability. This doesn't mean that corporate social responsibility is the cause of higher profitability, but there is a definite connection.

Of course, social responsibility entails an economic calculation as well as a marketing calculation. And that's where the views of economist Milton Friedman come in.

Decades ago, Friedman famously called on businesses to focus on their "social responsibility" to serve shareholders by increasing profitability. In other words, profits come first.

These days, analysts and industry observers have noted that many social responsibility programs benefit the company economically, by cutting costs, for example, or by polishing the firm's image for marketing reasons (in the interest of sales and profits).

When heavyweights like Walmart, Procter & Gamble, and McDonald's throw their considerable marketing and economic power behind an issue, they can make a real difference, which gives their brands a boost and helps their competitive position. And companies that seek to protect their supply chains or develop unique products wind up helping their sales and profits while they help the environment, as this recent Time article points out.

So it turns out that Milton Friedman was actually correct: His view of businesses being responsible primarily to shareholders/owners underscores the economic importance of corporate social responsibility in the 21st century.

Businesses that don't act in a socially-responsible manner will be at a disadvantage in maintaining customer loyalty, building profits, and satisfying their shareholders. Social responsibility turns out to be a win-win for businesses and society, in a bottom-line way that Friedman may never have thought possible.