Friday, 2 November 2012

Microsoft Surface Tablet gets one big positive review. From Oprah.

I know marketing, I get marketing but this endorsement of Microsoft's new Surface Tablet is bizarre. It's in her O Magazine December issue, which as you can see above is about Christmas and has an annual feature of her "favourite things".

How they ever managed to get Oprah to go along with this I just don't know.

Most of the reviews last week following the launch, were favourable and as you'll know this is make-or-break time for Microsoft as it enters the hardware market for the first time.

So Oprah has declared The Surface Tablet as, "one of her favourite things of 2012" in the December issue of her mag O. "it feels like a Mercedes Benz to me people" she gushes and goes into uncharacteristic tech speak, more Press Release words, about the weight, the kickstand etc. 

Oprah endorsed the IPAD in 2010 ("the best invention of the century") bringing in huge sales. So it's one hell of an endorsement.

As a strategy, celebrity endorsement has real value and in the digital age, is easily shared. It's a key moment for Microsoft's tablet and will help hugely. But normally, these are paid for endorsements but given that it appeared as editorial in the magazine, would seem to be genuine.

Or at least, on the Surface.

Thursday, 1 November 2012

Disney buy Star Wars for over 4 billion usd. George Lucas interview.

George Lucas, the sole 100% shareholder of Lucasfilm, has sold Star Wars to Disney for over 4 billion usd.

Star Wars has cult status amongst the online community largely because of its hi-tech special effects and futuristic themes so it's a deal that's got a lot of attention. Lucas, who created the franchise, says he's selling to make sure the movies live on and I'm sure the 4 billion helps - although to be fair, he didn't need the money and interesting too that he was able to hold 100% equity all this time.

Disney have indicated that their focus is online broadcasting and gaming, which will be huge. They've also said they'll feature more on social and mobile than console. Gaming only accounted for less than 20% of Lucasfilm revenue last year so if that's developed properly (and Disney have the wherewithal to do it), it has huge potential. Lucasfilm have a game division called 'LucasArts'.

Films accounted for 25% of revenue, consumer products 25% and others the balance last year. A new Star Wars movie is promised by 2014 and two more to follow that.

This is an example of Hollywood and digital tech getting closer together - what's been referred to as the 'convergence of the media' or the 'mash of media'. Disney already acquired Pixar for 7 billion and Marvel for 4 billion.

A great pay day for George Lucas who's own imagination started it all and a great day for online as another classic franchise will flood the web.

The Web is becoming THE place for entertainment and that's an opportunity.
As more and more people turn to the web, notably through connected TV, they'll look for more and more entertainment. Already companies like Amazon and Netflix are calling out for produced content (kids and comedy programmes are favoured).

So this is a whole new world of programme opportunity, perhaps sponsored by brands like the shows of old.

Wednesday, 31 October 2012

New survey "The State of online advertising". And it doesn't make good reading.....

Adobe and research company Edelman Berland, have just published a report on the "state of online advertising" which throws up some sobering stats. It shows a marked difference between how consumers perceive online advertising versus how marketeers do.

68% of consumers found online advertising "annoying" whilst only 47% of marketeers did. 14% of consumers found it "eye catching" whilst 21% of marketeers did. And notably 10% only of consumers found it "clever" whilst 22% of marketeers thought it was. 

Only 31% of consumers enjoyed the Ads and 45% said the best place for advertising was on "newspapers/TV". Blogs and Apps do badly at 4%. 11% of consumers thought there were "no good ads".

57% of consumers say they've "liked" a brand on Social Media and a massive 53% want a "dislike" button too! 73% said that they thought Ads should "tell a story" and 67% thought a video was "worth a thousand words".

The sense of the survey is that online advertising needs to tread carefully to be receptive and effective. In other words, it's a different medium and so simple adaptations from the offline world, won't cut it. In a lot of ways, online advertising is an intrusion, especially on Social Media and so it needs to be handled with more care. It needs to be relevant and worthwhile.

What the survey points out is that practitioners (marketeers) think they're doing a better job than in fact, they are. Possibly, and I see this a lot, because they're not as familiar as they should be with the online marketplace.

To advertise to your audience, you need to understand your audience and indeed, understand the medium in the same way that we all understand traditional media.

Consumers feel (54%) that online banners simply do not work and that TV/online video is the way to go. So better formats with better, relevant and less intrusive content will work more successfully.

There's a danger here in online advertising that we're getting it wrong. Knowledge of what is happening in the online space, is power. And perhaps, above all, Ad Agencies should bring themselves more up to speed before they start talking.

There's a lot of research out there that says that the ad makers don't get it. That we don't really understand and are paying it all lip service as "just another medium" - which it's not. The space is different, the consumer attitude when in the space is different, the ability to connect is different. This survey is just another warning.

Take it serious.

Tuesday, 30 October 2012

Starbucks. The brand that was loved could be in trouble over paying low tax.

Starbucks, the brand of choice for the new middle classes, is taking a hammering in the UK and will in Ireland, as its tax affairs become more public.
Whilst tax affairs have never really been the concern of marketing managers, in these days of austerity, issues like this come more to the fore.

The image above is one of many and taken from an 'Occupy London' protest.

A respected market research company 'YouGov' said Starbucks was facing a "brand catastrophe" and that consumer perceptions are declining daily after Reuters published an investigation into Starbucks low tax. It revealed that they only paid 8.6m stg in tax since they opened in the UK in 1998 (about 600,000 a year over 14 years).

In current climates, the public have a low tolerance of anything that even sounds like corporate greed but of course, Starbucks are only availing of "policies" from The British government/revenue to locate there. 

Indeed Ireland, has a widely acknowledged and hugely controversial, low 12.5% tax base which means that international companies who locate here, can wash global profits through Ireland at the lowest tax rate in Europe. It's a strategy that attracts investment which is based not on the PR spin of talent/resources/education, but rather, tax advantage. It is utter nonsense to suggest that if you allow corporates to avail of special tax incentives and evade tax in other markets where they trade by utilising EU provisions, that they won't avail of it.

Starbucks have now joined Google (headquartered in Ireland), Facebook (headquartered in Ireland) and Amazon as the focus of disquiet from the public about their tax affairs. Starbucks claim they're actually paying correct levels of tax due to loses incurred in their set-up in the UK although given that it attracts over one million customers a day in the UK, this is hard to believe. A business with that level of custom, should be profitable.

In the UK, tax is calculated on profits after interest costs and royalties and of course, adjusting those royalty costs, allow the company to minimise its tax. The fee is paid to the European HQ in Amsterdam and for example, in 2007 Starbucks would have been handsomely profitable if this "fee" wasn't paid.

However, payments like these, with the consent of HM Revenue, help corporates to avoid tax locally and about 25% of the 700 largest UK businesses paid almost no tax according to The Financial Times through devices such as these which smaller companies have no real access to.

Public anger over corporate tax is absolutely likely to continue and affect brand. Already campaigns against Starbucks, outside their stores, are planned.

The once doyenne of the middle classes could very quickly become a pariah.
And so too, very many others.