The Light Bulb Law Wars

Today's traditional incandescent light bulbs are being phased out, little by little, following a federal law enacted in 2007 that will take effect nationwide in 2012. The key word here is traditional.

The intent was to give manufacturers a push toward higher energy efficiency and have consumers replace hundreds of millions of energy-hog bulbs with energy-saver bulbs. Now that the deadline is drawing near, however, some consumers and lawmakers are not happy.

As the law now stands, 100 watt incandescent bulbs that use current technology will be the first to disappear from store shelves, to be replaced by--what? Contrary to some misperceptions, compact fluorescent light bulbs (CFLs) are not mandated to replace any traditional light bulb.

A spokesman for the electrical manufacturers trade group explains: “Unfortunately, people do not yet understand this lighting transition, and mistakenly think they won’t be able to buy incandescent light bulbs . . . Incandescent light bulbs are not being banned, and the new federal energy-efficiency standards for light bulbs do not mandate the use of CFLs."

Light bulb manufacturers have been busy for the past four years, developing new technology for long-lasting, energy-saving bulbs. General Electric, for instance, developed the LED bulb shown above--priced at about $40 or so--to replace the traditional 40-watt incandescent. LEDs are one alternative to CFLs. Both CFLs and LED bulbs are much pricier than the ordinary light bulb. Although prices will come down over time as production expands, initial prices are sure to give buyers a case of sticker shock.

No wonder so many consumers are stockpiling cheap, traditional light bulbs just in case. Some legislators (state and federal) are protesting the switch, saying the government shouldn't be meddling in light bulb affairs.

And about the green angle: Because CFLs and other newer light bulbs shouldn't be tossed into household trash once they burn out, convenient and easy recycling must be arranged to ensure that products intended to save energy don't wind up polluting our planet.

Kodak's New Marketing Picture

Over the years, Eastman Kodak has changed its marketing as technology advanced, consumer behavior shifted, and competition intensified.

The company was founded in 1888 to make simple box cameras for consumer use; in 1889, it introduced its first film product. Shelves full of Kodak's bright yellow film boxes were a familiar sight in photo stores and tourist attractions for decades.

Seeking new customers, Kodak began selling instant cameras and film in 1976, a challenge to instant-photo pioneer Polaroid. By 1986, after a decade-long fight with Polaroid over patent issues, Kodak stopped selling instant cameras and film.

By the turn of the 21st century, the digital photo revolution was underway. Film sales, once a source of steady revenue for Kodak, were dropping and the company finally refocused on a new digital strategy, including entry into the inkjet printer market. Inkjets have helped Kodak complete the transition to a digital product portfolio capable of attracting both consumers and commercial customers.

The company's recent ad campaign has put the spotlight on cameras that facilitate photo sharing--a key benefit for consumers connecting via social media. No more yellow boxes of film, just speedy image capture and click! posting to Facebook or YouTube or other popular sites.

Speaking of social media, Kodak is very active in that space, with blogs, Facebook pages, a YouTube channel, Twitter accounts, and more. It also offers free downloadable publications with social media tips and mobile marketing tips.

Can this new marketing picture, focused on younger consumers and featuring social media, return Kodak to profitability by 2012, its target date?

Where Is The Gap Going?

The Gap has been struggling with sluggish sales, a declining profit margin, and an uncertain economic climate. What's the future for this 42-year-old fashion retailer?

Cotton prices are rising, as are transportation costs (due to higher oil prices). Customers won't accept price hikes in line with these steep and sudden cost increases, so Gap's margins have shrunk to under 40%. Given the economy, customers are likely to remain bargain-hunters, leaving little opportunity for margin increases in the coming months.

Meanwhile, Gap's new logo, introduced last year, caused an upheaval among brand fans, igniting a social-media firestorm--and the company quickly reverted to its traditional logo.

What about social media? Gap has 1.5 million "likes" on its Facebook page, but only 354 followers on its corporate Twitter account. Its YouTube channel has a few videos but not too many views. GapMobile invites mobile browsing, buying, and store location functions.

Who, exactly, is the Gap's target customer and how does that customer feel about the brand, the shopping experience, and Gap's image? I'd be interested in finding out how many Gap customers take advantage of this special deal with Goodwill: From May 19-29, anyone who brings a donation to a Goodwill store or a Gap-branded store (Gap, BabyGap, GapKids, GapBody) agets 30% off Gap purchases that day. Will this social-responsibility project resonate with Gap customers?

What's next for the Gap?

USAA: Tops in Customer Service

USAA frequently ranks as one of the top US companies for top-notch customer service. The financial services firm, based in San Antonio, Texas, was #1 in a survey released just this week by Nunwood. Why?

One reason is that USAA's employees receive intensive training--not just in products but also in understanding their customers' needs and situations. Newbies receive weeks of training before they start to serve customers. And the work force is treated to ongoing development to keep their skills polished.

Another reason is that USAA has redesigned its back-office systems to allow employees to serve the needs of customers in a life-cycle way. In other words, customers don't have to think about whether they're contacting the banking department or the insurance department or whatever. USAA instead takes a broader perspective (the customer is being transferred and how will that change his or her needs and how can USAA help meet those needs?).

USAA is social media-savvy, with a presence on Facebook, a Twitter account, and a YouTube channel too.

Pirates of the Caribbean's Ubiquitous Marketing

Weeks and weeks before Johnny Depp made it to the big screen in this year's Pirates of the Caribbean adventure, Walt Disney's ubiquitous marketing was building excitement for the brand franchise.

One clever partnership was with Pirate's Booty, a snack with "healthy" marketing overtones. In stores that carry Pirate's Booty, limited-edition packages were faced out on end caps and other high-profile locations to showcase on-package tie-ins to the new Disney movie.

Disney is also using Yahoo! ads and links to trailers. When Disney put a link to the official trailer on Yahoo! in December, it attracted 2.4 million views in the first 24 hours.

Not coincidentally, the latest LEGO catalog arrived yesterday, featuring the official Pirates of the Caribbean sets on the cover and in spreads inside. If you visit LEGO's dedicated Pirates page, you'll see that the graphics echo Disney's movie graphics.

Of course Disney has a Facebook presence for the new movie. As of opening day, that page had more than 5.4 million "likes." With the big Memorial Day movie-going weekend only days away, the marketing has successfully created an atmosphere of anticipation and generated lots of discussion about the movie (and more). Arrrrrgh.

Fortune 500 Page Count, 1998-2011

Once again, this year's Fortune 500 printed issue is fatter than the previous year's issue, loaded with many more ads and articles than in 2010. I have the annual 500 issues going back to 1998 so I can compare the lists over time. Below is the page count, year by year.

2011: 316
2010: 308
2009: 276
2008: 356
2007: 386
2006: 384
2005: 410
2004: 478
2003: 410
2002: 402
2001: 474
2000: 630
1999: 510
1998: 506

Clearly, the size of the issue reflects the economic situation and, to some extent, the fortunes of the magazine business. Note that the peak for this period was 2000, when the issue had a whopping 630 pages.

Fortune now offers a Fortune 500 app, downloadable from its Web site.

If you need corporate statistics stat, look up this app!

Domino's: Honesty IS the Best Policy

Click to the Domino's Web site these days, and you're likely to see a headline like the one I saw the other day: "You asked for better chicken, and we delivered."

Owning up to its shortcomings--and responding, in a very high-profile campaign--has helped Domino's boost sales and profits during the past 18 months.

There was a lot of buzz when Domino's announced via its ad campaign in 2010 that it was tweaking its products due to harsh customer comments such as "tastes like cardboard." The move was gutsy and risky. In fact, the company went a step further and began posting videos and photos of its Pizza Turnaround program, reinventing its pizza "from the crust up."

Honesty paid off: Domino's began seeing significant increases in revenues and share, a trend that continues to this day. And the company is involving customers in the message as well. It invites customers to post Facebook photos and videos of food they've ordered from the company, showing how it looked when delivered. The idea is to demonstrate that what you see in a Domino's ad is what you'll get in the box when you order.

I like the way the Domino's blog reinforces the "you asked for it, you got it" theme as well as announcing new products and special offers. Honesty is the best policy!

Apps: Privacy Protection By Design

Angry Birds does something few mobile apps do: It offers access to its privacy policy through a link on its user interface.

According to two recent surveys, very few of the leading paid mobile apps show their privacy policies on their sites or within their apps. There's no excuse--if Angry Birds can do it with no apparent negative reaction from users, any app marketer can (and should) do it.

Privacy is in the spotlight right now because of revelations about smartphones invading users' privacy, such as the news that Apple's iPhone has been tracking user locations and storing data unencrypted. Not surprisingly, many consumers and legislators are upset, and new regs may be the result. Rather than ignore the issue or wait for government intervention, apps should follow the high road and incorporate privacy by design, making customer protection the default position today.

Will Digital Wallets Catch On?

Visa recently announced the fall introduction of a new digital wallet service for one-click buying. Customers with a Visa card simply use a password and click to complete an online or mobile purchase on any Web site, adding convenience and speed to the transaction. Visa is also looking at a near-field communication payment system, in the mode of "wave your phone near the payment point" and enter a PIN to complete the transaction (above).

The digital wallet isn't a new concept. Google has been experimenting with a near-field communication payment system. Isis (owned by big telecommunications firms, among others) plans to test a near-field communication system in Salt Lake City next year. Intuit is working on a mobile payment system of its own.

Will any of these catch on with consumers? To become popular, any digital wallet will have to provide much more convenience and speed than existing payment methods. It will also have to be highly secure, a very important point for customers wary of problems such as the theft of debit/credit card information from compromised PIN pads in Michaels craft stores.

Tupperware Goes Social: Back to the Future

Fifty years ago, Tupperware parties were "social:" a chance to chat with friends and neighbors while buying those now ubiquitous plastic storage containers. Tupperware was ahead of its time, and now it's gone back to the future with social media activities to attract buyers when and where they interact with each other.

If you're on Facebook, so is Tupperware, along with its various promotions (see left) and its social responsibility activities (Save the Children). If Twitter is your preference, you'll find a Tupperware account there, too. (Tupperware offers fundraising opportunities, as well, with the designated charity receiving 40% of the purchase price from items bought during a Tupperware party.)

However, to jumpstart its social media campaign by leveraging a built-in audience, Tupperware hired Kelly Clarkson. "Kelly Clarkson is the perfect ambassador, as not only is she an extremely confident young woman, but is hugely influential in the social media world, with over two million Facebook fans and almost 900,000 followers on Twitter," observes Tupperware's VP of Global Communications and PR.

That's important, because if you click through the links I provided for Tupperware's FB and Twitter accounts, you'll see that the follower and fan figures are very low. For any Tupperware message to break through in social media, much higher audience numbers will be needed. Will Kelly Clarkson be the key to Tupperware's social media success?