WSJ.com's Internet Wayback Machine

I received an email this evening from Bill Grueskin, Managing Editor of WSJ.com. No, it wasn't a pitch to subscribe; I'm already a subscriber. Imagine my surprise when I read the following:

We have a bunch of nostalgia on the site this week to commemorate WSJ.com's 10th anniversary-- and starting at midnight the whole site is free til May 10

Among the highlights is the original WSJ.com home page from late April 1996, http://online.wsj.com/public/resources/MoneyInvesting/edit/frontpg.html

At the bottom there's a Readers Discuss link, which takes you to this page, http://online.wsj.com/public/resources/MoneyInvesting/edit/t-ptcol.html

Which takes you to this letter at the bottom, which is, when I read it today, pretty damned prescient.

I assume you're the same guy (we didn't have Google in 1996, did we, but I seemed to find your site quickly today), and if so, I salute your wisdom!

Best regards,
Bill Grueskin
Managing Editor,
The Wall Street Journal Online at www.wsj.com

He then proceeded to cite my posting to the reader's discussion section as follows:

Universal freedom of the press is, in my opinion, the biggest change that the Internet brings to our society. For the first time, the little publisher has access to the same means of distribution that The Wall Street Journal or The New York Times does. His audience is limited only by his ability to deliver content that the Internet wants to read, and his ability to market that content. Never in the history of America (or any nation), has the ordinary person had control of both the printing press and a global means of distribution. John Adams and Thomas Jefferson would have been proud, because tyranny by the government is nearly impossible when there is no centralized control of the communications medium.

This concept of democratic expression brings up a fundamental difference between the Internet and other types of media. The Internet is a community of interacting citizens. Its attraction is not that it is great technology; its attraction is that it provides a distance-insensitive way for people to distribute their ideas, their pictures of their cats, their concepts of what is true and good and what isn't. The technology has many limitations at the moment: bandwidth is not free, the connectivity is too slow, and people need computers to participate. However, as a communications medium, its power, reach, and flexibility are unmatched by any other today.

This democracy of access also extends to the business community. On the Internet, no one knows how big your company is. The World Wide Web distills your company into what it publishes and how well it reacts to customer need. Therefore, if you can prove to your readers or customers that you can satisfy their needs as well as a multi-billion dollar corporation can, you can compete in the Internet market for your goods or services. So Joe's Local Bank can take on Citibank on the Internet and win, provided they provide better service to their Internet customers.

Surprisingly, this democracy also causes a paradox. In a world where there is no predetermined information sources, how do we know what to believe? If anyone can publish anything, then the free market gets to decide what is truth and what isn't, and there is no natural law that ensures that the truth will win. If a majority of visitors to an Internet site claim O.J.Simpson is guilty, it does not make it so; it just makes it a majority opinion. A majority of readers can vote to make pi = 3 (as some state legislatures have attempted to do); it's not going to make it true.

This paradox leads to two possible outcomes: majority opinion becomes confused with truth, or people learn to live with this free market of ideas and become more discriminating in believing what they read. The authors of legislation such as the Communications Decency Act believe that the former is true, and that authorities need to provide guidance to ordinary people in what they should read or see. I hold the more optimistic view that Internet readers can learn to live with the ambiguities of having multiple conflicting sources of information (just as they already do with television and newspapers), and that they will make intelligent choices in what they read and believe. Society will evolve to embrace the freedom of speech and press on the Internet just as ordinary citizens learned how to vote on complex issues in government. The Internet will be the catalyst to that evolution, and it will foster the freedom of speech and press throughout the world.

Carl D. Howe
BBN Corporation

You know what? I still believe all of this, despite 10 years of change since. And trends like open source and Wikipedia only provide more proof of my thesis. May it still as true in 2106 as it is today in 2006.

Technorati Tags: Publishing 2.0, Marketing, Publishing, Opinion, Internet, WSJ.com, Wall Street Journal

Microsoft's problems begin to hurt its earnings

Blackfriars noted last month that Microsoft's size and complexity were hurting rather than helping its prospects. Those observations showed up in Microsoft's earnings yesterday that fell short of analyst estimates. Financial analysts have viewed this as evidence that Bill Gates and Steve Ballmer intend to go to war with Google and Sony. While that might reassure those who like that type of combative attitude, I might remind them of one of the lines from the Godfather: "Blood is a big expense."

Companies often think getting big gives them economies of scale. But in an information and attention economy, it also increases communications costs. It just flatly costs a lot more to get 61,000 employees on the same page and to innovate than it does 6,000. Want proof? Think about this statistic: Microsoft is on track to spend nearly $6 billion this year on research and development. Now name six innovations from Microsoft over the past 12 months (note: it isn't easy once you get past XBox 360). Would you value those innovations more than those from companies like Google? Are they worth $6 billion?

The problem with Microsoft today is that for the last 10 years, it has been focused more on protecting its monopoly in Windows and Office (the only two divisions that routinely make a profit) than in doing anything new. And it has grown so big that even communicating any new strategy costs millions of dollars and months of time. For example, next Monday, Ray Ozzie -- someone that many business publications have annointed the savior of the company -- will have been at the company a full year as of May 1, 2006. And yet his most significant impact on Microsoft so far has been a multi-page memo on the Internet. Compare that with people like Paul Otellini at Intel who is doing a top-to-bottom review of the company to deal with its problems, and he's only been in the top job a few months.

Microsoft needs to be a smaller company to communicate better, reduce its costs, and innovate. It has two choices: it can shrink itself by breaking up into smaller companies, or the market will do it for it through decreasing its share price. Judging from today's reaction to Microsoft's earnings, it may not have that many more years to make that choice.

Full disclosure: I have no financial investment in Microsoft, nor does my firm do any business with Microsoft.

Technorati Tags: Analysis, Earnings, Financial analysis, Microsoft, Opinion, Research

Rethinking the four Ps of marketing

Thanks to Guy Kawasaki, I got to read John Sviokla's and Antony Paoni's article about Marketing Remix. It argues fairly persuasively that the Internet has disrupted traditional four P strategies of marketing.

Why is this phenomenon so important to business leaders? – because the traditional marketing model is insufficient to address the reality of today’s customers. The entire science of marketing has been developed to understand who buys, why they buy, and how they buy. The traditional marketing mix is made up of product, place, promotion, price -- all consistent with a positioning for the product or service. The power of this model was to point out the key tools that firms have to bring their product or service to market successfully.

Each of these concepts becomes much more complex and diffuse in this new world. "Place" is not so obvious, for the place where people shop is now a combination of physical and informational environments.

Promotion is not so clear, because while formal, outbound efforts like advertising and couponing will continue, marketers must also acknowledge the self-organized nature of user-defined ratings of products and services. These are influential and out of control of the marketer. It is now much more about word of mouth -- turbocharged by peer-to-peer communications like the phone and the internet.

The article does a great job of articulating some possible causes of shifts we've seen in our latest research, such as the decline in marketing satisfaction, the rise of non-traditional marketing budgets and the decrease in traditional advertising spending.. It also provides more ammunition for why successful marketing companies today are Overall, it's an excellent roadmap for rethinking today's marketing strategy in the context of the tyranny of too much.

Technorati Tags: Advertising, Buzz Marketing, Marketing, Four Ps

Sun's new executive brand

Today's New York Times profiles Jonathan Schwartz, who took over the reins of Sun Microsystems as CEO from Scott McNealy this week. The article talks about how he views Sun's strategy and what he might do to change its technology and business direction. But I think that the article misses out on another marketing story: Jonathan is reshaping Sun's executive brand.

Scott McNealy was a Silicon Valley icon, known for headline-grabbing sound bites, serious hockey playing, and fierce competitiveness. Most market watchers would say that CEO McNealy was Sun. But Jonathan creates a new brand image for Sun because he can:

• 
  Communicate. Jonathan's blog has a personal voice and a strong point of view. McNealy always said the network was the computer; Jonathan's blog shows he lives that vision and is comfortable with it.


• 
  Differentiate. How many CEOs do you know who sport a pony tail? Jonathan is as unforgettable a personality as Steve Jobs and that willingness to be different from everyone else carries over into his business approach too.


• 
  Break with the past. Unlike McNealy, Schwartz wasn't there at the big bang that created Sun as McNealy was. So if he finds strategies or behaviors that don't work for him, he can ditch them without any loss of credibility for his vision of what Sun should be.

So what does this new branding mean for Sun's strategy? The article provides some good clues:

But if Sun is to really shine, what Mr. Schwartz needs is his iPod — a runaway hit product to give the company new life in a new market.

Now that he has the reins at Sun, Mr. Schwartz is giving hints of his own direction. He said in a telephone interview on Monday that his first task would be to sit down with Gregory M. Papadopoulos, Sun's executive vice president and chief technology officer, and review all of the company's development efforts.

The thought of these two executives planning the future of Sun should give pause to anyone thinking that Sun is only a server company. A few years ago, Papadopoulos coordinated research on self-organizing "Internets of things", which led to Sun focusing on RFID, sensor networks, and a host of other leading edge applications. And Sun has the only currently shipping eight-core processor, something that Intel won't have available until 2007. With a stable of cutting edge technology, and a new CEO who's not afraid to be embrace being different, that runaway hit Sun iPod may not be as far off as people think.

And if that happens, expect to see CEO pony tails become as much of a trademark as Steve Jobs' black turtlenecks.

Technorati Tags: Branding, Jonathan Schwartz, Marketing, Processors, Research, RFID, Sun

Yellow Tail's great marketing story

The New York article in its Sunday business section titled, "The Wallaby That Roared Across the Wine Industry," outlines how this one brand from Casella Wines Ltd. grew from zero to 7.5 million cases imported into the US in just five years. The article talks of the many factors that have contributed to its success, but I think the marketing and branding story speaks volumes because of its simplicity and honesty.

The Deutsches have scheduled some $24 million for promotions this year, up from $4 million in 2005. Billboards featuring yellow tails on a bird, an airplane and a mermaid, as well as a yellow ponytail on a pretty girl, have become familiar sights in some cities.

Perhaps more important, Mr. Cartiere and others in the industry say, the Deutsches provided Yellow Tail with almost instant access to the American market, using the distribution network they had built over two decades for Duboeuf wines.

The increasingly familiar Yellow Tail label is loosely meant to depict the brand's namesake, a yellow-footed rock wallaby, a smaller cousin to the kangaroo. The bottle labels and in-store advertisements always put the brand name in lower case and within brackets: [yellow tail].

As for those brackets, the story is that the Casellas were looking up "kangaroo" in a textbook when they came upon a technical description of a wallaby. In the margin, alongside the Latin derivation of the name, was the Australian version, in brackets: [yellow tail]. They decided to keep the brackets "to set the wine apart" and to retain the lower-case lettering "to underscore the wine's lack of pretension," John Casella said.

Yellow tail shows how a single clear marketing concept -- a clean brand identity and broad distribution -- can slice through today's media clutter. And with a delicious product behind it (I love Yellow Tail for everyday wine and buy it regularly), the Casellas have created a powerhouse Australian business. Now the question is only, who will do the same for Argentina or Chile?

Technorati Tags: Marketing, Branding, Wine, Australia

Mistaking data for insight

Businesspundit wonders if concentration is the new competitive advantage. He cites Harvard Business School professor Nicholas Carr noting that the tyranny of too much may be luring us into a pursuit of data instead of critical thinking:

...data is a comfort blanket in a way - we all do this. People are becoming addicted to getting more information all the time. You can see it when they get out their BlackBerrys as soon as they've stepped off a plane.

Like me, you've probably sensed the same thing, in yourself and in others - the way the constant collection of information becomes an easy substitute for trying to achieve any kind of true understanding. It seems a form of laziness as much as anything else, a laziness that the internet both encourages and justifies.

I'd put it another way. We used to live in an era of information scarcity; those that had the most information had significant power over those who didn't have it. But the Internet and the Web have destroyed that power. What is now scarce is synthesis: the ability to connect many data dots and create meaningful insight into what the data means.

One of Blackfriars most successful and most challenging courses is one we titled, "Turning Data Into Insight". In that course we give attendees some processes to create the type of synthesis we describe above. And the biggest struggle we see for attendees is that of not just presenting data, but actually interpreting the data using their own knowledge and experiences. It's hard work, and we also find it becoming increasingly rare.

But I particularly like Businesspundit's conclusions of how to counter this laziness in marketing yourself and your company:

....sustainable competitive advantage often requires that you be a contrarian. You go where other people aren't. You don't follow the masses. You let other companies move on from fad to fad while you question each "new thing" and focus on boring ideas like execution. Don't get distracted. Build a culture of concentration. While everyone else is searching for a long tail and a blue ocean, you can keep focusing on niche markets and differentiation, just as you always have. Concentration, focus, execution, the ability to tune out the fluff - that will be the competitive advantage of the future.

I'd change only one thing: concentration, focus, execution and the ability to tune out fluff are valuable now; there's no need to wait for the future.

Technorati Tags: Business, Marketing, Insight, Tyranny of too much

See more of Great Britain; rely on GPS navigation

Technology is often marketed as the cure for many or all imperfections that we humans possess. However, someone over in the UK should do some anti-technology marketing. Engadget notes that UK drivers trust their GPS navigation systems more than what they see through their windshields:

Despite warning signs on both sides of the road, and nothing but water straight ahead, local villagers have found themselves pulling an average of two cars a day out of the river for the past week. "When you ask what happened, they say, ‘My sat-nav told me it was this way,'" one resident told The Times. Meanwhile, the village of Crackpot (yes, that's really its name) has had to deal with drivers whose navigation systems have directed them to the edge of a cliff with a hundred-foot drop. So far, there have been no serious injuries, but drivers have found themselves stranded on a rocky path.

Remember those mirror notes saying, "Objects in mirror are closer than they appear?" Next thing you know, we'll have to have warning text on the navigation screen inside the car saying, "Objects outside are more likely to hurt you than ones that appear here."

Technorati Tags: GPS, Marketing, GPS, Technology

UK Internet advertising approaching four percent of marketing spend

OK, this is a source we don't often get to cite, but we'll cite anyone with cool data. Strumpette notes that The IPA in the United Kingdom has just released research data showing weaker marketing spending there for 2006 and 2007. Just as we've seen in our research, online advertising appears to be gaining as a proportion of marketing spending in the UK at the expense of traditional media. You can read the original summary of the report here, and you can buy it from NTC here, but Amanda Chapel's recitation of the data is so much more interesting. It just shows how PR can make data come alive.

Technorati Tags: Advertising, IPA, Marketing, NTC, Research, Strumpette, Surveys

Apple shows that good marketing can trump the Osborne Effect

Apple just reported earning $0.47 a share on $4.36 billion in revenue. That exactly matches Blackfriars earnings per share prediction, but is $160 million more on the revenue side than we forecast. Other differences from our forecast were than Apple sold about 1 million fewer iPods than we predicted, but the Mac business grew about 4% year over year. That's fairly amazing given that Apple's Intel-based MacBook Pro didn't even start shipping until half-way through the quarter. The earnings call attributed the better than expected performance to great iTunes Music Store sales, software, and retail store sales. We'll note that two out of three of those efforts were widely predicted to fail during the last five years.

I'd say Apple has proved that good marketing is more important to business performance than the Osborne Effect pundits thought would hamstring it a year ago.

Technorati Tags: Analysis, Apple, Financial analysis, Intel, Marketing, Osborne Effect

Online ad revenue now exceeds that of magazines

This must be Ad Age week. Advertising Age today has a story on Merrill Lynch's report that Online ad revenue now exceeds that of magazines. Needless to say, the magazine publishers insist it is no big deal:

Assuming the forecast is correct, magazines will become the first big medium to watch the Web pass by -- unless you count phone books, which are also projected to fall behind in 2006. Yet magazine publishers insist that's not bad news, but rather an opportunity for those among their ranks that have already started the shift to being digital savvy, media-neutral purveyors of content.

"The people who report on media like to think it's really significant," said Nina Link, president-CEO, Magazine Publishers of America, of the tipping point. "I don't. It just says there are more opportunities to reach consumers and make powerful partnerships. The powerful brands and media are going to thrive."

I agree with the sentiment that powerful brands and publishers will thrive. But the Magazine Publishers of America are whistling past the graveyard regarding the shift in revenue; it is a very big deal. Why? Because on-line advertising is less expensive than print advertising per thousand impressions. Therefore, by the time online advertising revenue has surpassed print, the number of online impressions being sold is factors of two to five higher.

And don't think this is all small change. Blackfriars most recent research showed that on average, US companies plan to spend an average of 10% of their marketing budgets on online advertising this year. Big advertisers like Absolute Vodka, Ford, and GM already plan more than 20% of their marketing budgets online. And given the trend of moving more ad dollars online, that has to be hurting the print business.

No this isn't the end of magazines. But given the expense of print magazine production and distribution, it also doesn't suggest that magazine publishing is a great growth area either. Just as Blackfriars has predicted with newspapers, magazines will need strong brands, clear niches, and laser-sharp marketing to thrive. And those that don't have those attributes are likely to see their advertising lifeblood dry up. They won't be whistling past the graveyard -- they'll be in it.

Technorati Tags: Advertising, Advertising spending, Magazines, Marketing, Media, New media, Newspapers, Publishing, Publishing 2.0, Research, Web advertising

Ad Age notes the psychology behind halo effects

Advertising Age posted a great article about Apple's halo effect and notes it is not exactly a new phenomenon:

The halo effect has a long history in marketing. In 1930, Michael Cullen created the first supermarket chain which he called "King Kullen." His breakthrough idea was his method of pricing. He decided to price 300 items at cost. Another 300 items barely above cost. And the remaining 600 or so items at very healthy margins.

Guess which items he chose to advertise? The ones he sold at cost. What you advertise and what you make money on can be two different things.

That's a pretty sobering note for those of us who think that neuro-marketing is a new idea. I guess everything old is new again.

Technorati Tags: Advertising, Business, Halo effect, Marketing, Psychology

Another quarter, another state of the blogosphere

David Sifry over at Technorati has published his second quarter report on the state of the blogosphere. As always, it is great reading to understand the growth of consumer generated content. It also outlines the increasing need for aggregation and filtering sites as blog readers face their own tyranny of too much. With the number of blogs doubling every six months, the battle for reader attention is only going to get tougher for the foreseeable future.

Technorati Tags: Technorati, Tyranny of too much, Blogs, Publishing, Publishing 2.0

The tyranny of too much solves cable's choice dilemma

The New York Times had a great article on Sunday about how cable TV companies are reacting to the FCC's demand that consumers should be able to buy just the cable channels they want instead of today's channel bundles. The article lays out the conflict between consumers and cable companies this way:

Without bundling, programmers like Disney and Viacom might no longer be able to afford shows with smaller but loyal followings. Under the current system, they can produce niche channels like ESPN Classic because they are bundled with ESPN and other channels, the programmers say.


For the most part, the F.C.C. rolls its watchdog eyes and notes that the price of expanded basic has increased well beyond other goods and services over the past few years. It and the cable association have drawers full of studies disputing the other's studies about their studies. Kevin J. Martin, the F.C.C. chairman, showed up briefly in Atlanta to reiterate that he was not giving up the fight, even after recently cajoling cable companies to agree to put together a new, smaller tier of family-oriented channels that was a few dollars less than extended basic. "Putting more control in the hands of consumers is always good," he said.

But Forrester colleague and good friend Maribel Lopez has a nice counterpoint noting that pushing choice onto consumers doesn't always work either.

Strangely, these colliding views make sense. When asked whether they want total choice, especially from historically monopolistic quasi-utilities, it's no shock that most people say: heck, yes. Yet, as the author and psychology professor Barry Schwartz and two of his colleagues pointed out a few weeks ago in The New York Times Magazine, Americans have this funny habit of confusing freedom, which they cherish, with choice, which can give them headaches.


"We're definitely at an overwhelming number of options," Maribel D. Lopez, a media analyst at Forrester Research, told me. "It's frequently difficult to understand what you're buying. There's also different content that goes on different devices. We run the risk of consumers moving to indecision because they have a lot of choice."

Maribel notes one of the biggest contradictions in consumer behavior caused by what we call the tyranny of too much: more choices actually reduces consumer buying. As an example, Vanguard Investments and Columbia University did a study on retirement accounts, and discovered that every ten choices added to a retirement plan reduces participation by two percent. Consumers get overwhelmed by choice.


The other challenge facing the cable companies is that consumers do have more options today. Verizon and at&t are rapidly rolling out TV services in many locales. DirectTV is still fighting for the cable subscriber. And many TV shows are available on the Internet, either through downloading services like iTunes or through less sanctioned means like bitTorrent. So if cable operators don't get this right, they could see real defections from their subscriber base.


So what should cable companies do? Blackfriars believes they should embrace the FCC's decision and actively market a la carte channels. But at the same time, cable companies should offer simple bundles with the most popular choices. While a small number of consumers will actually sign up for the a la carte services, a much larger number will be overwhelmed with their choices and sign up happily for the bundles. The result: the cable companies can offer the consumer choice, while garnering nearly all the revenue they currently get through bundles. Moreover, they'll remove objections to their service that might force subscribers to switch to other vendors.


This is one of those marketing cases where testing actual buying behavior has a huge effect on the best offer to the market. The only question is who will find the win-win for consumers and operators first: the FCC, the cable companies, or their competitors.

Technorati Tags: Apple, Bundling, Business, Cable, Consumers, FCC, HDTV, iTunes, Maribel Lopez, Marketing, Opinion, TV, Tyranny of too much, Verizon

Apple will demonstrate even transitions can be profitable

On April 19, 2006, Apple will report its first quarterly earnings since it introduced Intel-based MacBook Pros, Mac minis, and iMacs. Forbes had an article last week noting that UBS cut its price goal for Apple to $95 on the basis of weaker PC sales. Because Apple didn't start delivering Intel-based machines until midway through the quarter, I can understand their skepticism, but I don't buy their forecast of nine percent drop in computer sales a year ago. Given the sheer number of new Apple laptops and iMacs I've been seeing around, I believe that Apple managed to sell about as many computers as it did last year at this time (which, by the way, wasn't a terribly stellar quarter as Apple quarters go). Add on sales of about 9.3 million iPods this quarter, and my model comes up with Apple earning $401 million on nearly $4.2 billion in revenue. That works out to $0.47 a share, which is slightly above analyst consensus estimates of $0.45 a share.

All that said, Apple's projections for how they see demand shaping up for their fiscal Q3 will be very interesting to watch. Just yesterday, AMD blew the doors off its earnings (many believe that its gross margins this quarter may surpass Intel's), yet projected a weak upcoming quarter. And Intel similarly isn't looking any better. But unlike those two semiconductor giants, Apple is at the beginning of its new product cycle of Intel-based Macs, whereas a lot of the PC world is stuck waiting for Windows Vista in 2007. And as has been noted, for every percent of PC market share Apple gains, it gains about $2 billion in revenue. I predict we'll see start seeing that some of that revenue appear on Apple's income statement in Q3. And even with the product transition this past quarter, the company will post nearly 31% growth over the same quarter last year. Now that's thinking different.

Full disclosure: I personally do own some Apple common stock.

Technorati Tags: MacBook Pro, Analysis, Macintosh, Apple, iMac, AMD, Earnings, Processors, Financial analysis, Intel, Macintel

The Power Of Stories

One of the questions we get frequently is, "How can I communicate the value and potential of my company quickly?" Well, this week's Forbes has an excellent column by Harvard Business School leadership expert, John Kotter describing The Power of Stories, which is one of our favorite techniques. As John notes in his article:

As I look around me today, I see that too few business leaders grasp the idea that stories can have a profound effect on people. The gestures made (or not made) by leaders can turn into the stories that powerfully affect behavior.

Leaders who understand this and use this knowledge to help make their organizations great are the ones we admire and wish others would emulate. Those in leadership positions who fail to grasp or use the power of stories risk failure for their companies and for themselves.

We couldn't agree more. Blackfriars has found stories a hugely successful technique for some of our clients. One had seven different products it wanted to launch all at once. The traditional product launch technique would have been for seven product managers to stand up and do PowerPoint presentations over an hour or two. What we proposed and did instead was to write, cast, and direct a small play that presented the consumer needs, the seven products being launched, and their value to consumers all in about eight minutes. Attendees were entertained, retained the information better, and had more time to ask questions. All of them "got it" in eight minutes.

Despite today's formal and technical business environments, we're all wired to understand stories. The next great marketing story is out there somewhere. The only question is who will pick it up and run with it first: you, or your competitor?

Technorati Tags: Blackfriars, Communication, Marketing, Stories

Why RFID marketers should do more testing

Yesterday's Wall Street Journal had an interesting and quirky middle column article about why some people microwave their credit cards. The real issue: there is a community of consumers who are very concerned about their privacy, and they don't want thieves to be able to steal their credit card numbers by radio snooping.

When Brenden Walker got his new MasterCard PayPass ATM card in the mail last month, he headed to the gas station to try it out.

To test the card's "Tap N Go" convenience, he passed it in front of the scanner, which activated with a beep and displayed the word "authorizing..." on its LCD screen.

That was quite enough for Mr. Walker. Without completing the transaction, he put the card down on the pavement and took a hammer to it.

....

In any event, he wants no part of it. Hammering the card destroyed the chip. "I tried it again and...nothing," he says. "I might as well have been holding up a salami sandwich."

Lest we think Mr. Walker is just a kook, financial services companies also thought people who worried about identity theft were just kooks about ten years ago. Now even the FBI is concerned about identity theft.

The sad part about this article is that if the card issuers had tested the technology with real consumers, they would have uncovered this concern and been able to deal with it. A radio-proof envelope for these RFID credit cards would cost them only about a dollar, yet would assuage these consumer concerns and provide significant marketing differentiation for the issuing company. But instead of a marketing coup, the Wall Street Journal article is noting just how short-sighted the RFID card issuers are, and how consumers are having to take matters into their own hands to deal with their shortcomings.

The card Ms. Lum carries came without any information about security safeguards, she says, so she decided to take no chances. "It's maybe a little bit of a paranoia thing, but hey, it's my credit rating," she says.

Eric Caraszi, a 26-year-old computer programmer in Albany, N.Y., recently bought an RFID-proof wallet after having a conversation with a co-worker about different ways criminals might be able to exploit RFID-chip cards -- from sneaky scans on crowded elevators to high-powered scanners on the roadside that could mine passing traffic.

"For every smart person trying to make a lock, there is going to be an equally smart person trying to unlock that lock," he notes.

Would that there were equally as many smart people in RFID card marketing.

Technorati Tags: Proximity cards, American Express, Visa, Marketing, Analytics, Advertising, Credit cards, RFID, Mastercard

Google's Schmidt notes the challenges of the attention economy

VC Confidential has a great summary of a recent talk by Google CEO, Eric Schmidt. I was particularly interested in a few of his initial points for marketers and advertisers:

• We live in a world of continuous distraction and multi-tasking. Just look at kids doing IM, watching video, talking to friends while doing homework. It will only get worse.


• People's attention is the most important asset for marketers (similar in theme of the AttentionTrust initiative).


• The key to getting people's attention is targeted advertising instead of untargeted. He asked how many people read the paper this morning or watched TV. Could they recall any ads they saw?


• Society is trying to block untargetted ads with Tivo, spam filters, Do Not call lists and such.

Now Schmidt isn't exactly an unbiased observer, since Google is the largest targeted advertising channel on the Internet, but these points rang true to me. For us here at Blackfriars, the attention economy drives a couple conclusions:

1. Narrow is better than broad. It is better to spend an equal amount of money to hit 50 people with a message they are deeply interested in than 500 people who are picked at random. The day of the laws of large numbers are, well, numbered.


2. Less messaging is more. The tyranny of too much says that when you have someone's attention, we have to deliver value quickly and succinctly to stand out. That means short messages with powerful ideas packed into them. Google's concept of doing ads in 70 characters of text is just the leading edge of this trend.

But perhaps others have a different take. I pose the question to readers: what are you doing differently to gain mindshare in the Attention Economy?

Technorati Tags: Advertising, Attention Economy, Business, Eric Schmidt, Google, Marketing, Targeting, Tyranny of too much, Venture Capital

MIT markets ingenuity with hacks

Anyone who has attended or lived near MIT knows its predilection for hacks, elaborate pranks that make most people laugh out loud and then start to wonder how they did it. There was the inflating MIT balloon at the 50-yard-line of the Harvard Yale Game in 1982. And there was the time students put a police car on the Great Dome with its lights flashing. Well, they've done it again. MIT students apparently stole a Civil war-era cannon from CalTech, shipped it to Cambridge, and put an MIT custom-built class ring on it.

Now of course, this is all very amusing, but think for a moment about the fact that MIT competes for the best and most innovative graduating seniors each year. You couldn't ask for a better differentiator for those creative, creme de la creme students who actually have the luxury of choosing which of several schools they will attend in the fall. This is marketing and PR MIT couldn't (and quite frankly wouldn't) buy -- and is one of the reasons why they continue to have one of the most accomplished and successful student bodies in the country. Proof again that good marketing doesn't have to be stuffy.

Technorati Tags: Hacking, Hacks, Marketing, MIT, CalTech

Take the Blackfriars marketing survey!

We're in the midst of gathering data from businesses for our second quarter Marketing 2006 report. If you are a business owner, director, or executive who has knowledge of your business marketing budgets and spending, we'd like your input for our market research. Respondents who successfully complete this 10-minute survey will receive a free PDF copy of our Q2 marketing report when it is published in early June, a $495 value. To take the survey click here!.

We now return you to our regularly scheduled blogging.

Technorati Tags: Blackfriars, Business, Marketing, Surveys

BusinessWeek's five-step program to present like Steve Jobs

This week's Business Week has an article by presentation coach Carmine Gallo on how to present like Steve Jobs. He makes it sound easier than it actually is, and even these five steps won't get you to the Tao of Steve. For that, little grasshopper, you should probably read the article from last year titled, Gates, Jobs, and the Zen aesthetic.

Technorati Tags: Apple, PowerPoint, Presentations, Public speaking, Steve Jobs

Apple launches Boot Camp to reassure switchers

[Apple's new dual-boot startup screen]

Apple surprised everyone today by posting a freely downloadable tool called Boot Camp that allows the new Intel-based Apple Macs to dual boot Mac OS X and Windows. It is no coincidence that it is snowing outside here in Massachusetts, since we are now hearing reports of similar weather in hell.

Seriously, this is actually just smart marketing on Apple's part. Good marketers remove buyer objections to their products. Some prospective customers for Apple Computers still fear that they won't be able to get software for their computers or have applications that they simply must run on Windows. This tool reassures those customers that they can always boot Windows on their machines if they must and run those applications. Don't worry; be happy.

The official press release also notes that this feature will be standard in Mac OS X 10.5 "Leopard." It further notes that Leopard will be the star of the show at its Worldwide Developer Forum in August, a point that had been speculated, but not confirmed until now.

And also to Apple's credit, they waited long enough after April 1 that no one can claim that this is an April Fool's joke.

But Apple also used its Boot Camp download page to do a little differentiation from Microsoft as well. From the sidebar, check out these two little bits of text:

EFI and BIOS
Macs use an ultra-modern industry standard technology called EFI to handle booting. Sadly, Windows XP, and even the upcoming Vista, are stuck in the 1980s with old-fashioned BIOS. But with Boot Camp, the Mac can operate smoothly in both centuries.

Word to the Wise
Windows running on a Mac is like Windows running on a PC. That means it’ll be subject to the same attacks that plague the Windows world. So be sure to keep it updated with the latest Microsoft Windows security fixes.

Ah, I love the smell of differentiation in the morning.

Technorati Tags: Apple, Intel, Marketing, Microsoft, Windows, WWDC

Waiting for Apple HDTV: the 2006 high-definition TV roundup

[Pioneer's 50-inch 1080p plasma display]]

It is April, so it's time for the consumer electronics manufacturers to announce their 2006 models so that they will be readily available for the holiday season. In no particular order, recent announcements include:

• Monday's New York Times talked about Mitsubishi's colored-laser ultra-lightweight rear projection TV.


• Yesterday, Engadget and HDBeat noted that Pioneer will ship its 50-inch 1080p plasma display to Europe in June (why Europe only, we're not quite sure).


• Panasonic has announced a 58-inch plasma panel (not 1080p by the way) and upgraded is consumer plasmas for one-remote operation.


• And Hitachi now is offering quad-tuner TVs with digital hard-disk video recorders built in.

This is all good, but from a marketing point of view, we'd have to agree with Forrester's Ted Schadler, who was quoted in the Mitsubishi article.

"Television used to be very, very simple," he said. "You bought a big one or a small one that was black and white or color."

That has all changed, Mr. Schadler said. "Now we've got complexity like buying real estate or buying a car or something," he said. "It's just gotten tremendously complicated."

Of course, we know a company that could cut through this complexity and make it simple with an all-in-one HDTV system, just as they were the only company to create an all-in-one Internet computer called the iMac. The big question is when. My bet is June.

Technorati Tags: Hitachi, HDTV, Panasonic, 1080p, Opinion, Marketing, Forrester, Mitsubishi, Pioneer, Apple, 720p, Plasma

Guy Kawasaki tells execs how to write

I am a huge fan of Guy Kawasaki simply because he will happily tell people exactly what they should do to get better at what they do, and he'll do it in a fun and interesting way. But his latest missive, The Art of the Executive Summary, is mis-titled. It should be "The Art of Business Writing" full stop.

But even more wonderful than the article are the comments to Guy's nine "do's" and seven "don'ts". One really struck me as profound:

Writing thin is a skill, and I believe that all entrepreneurs should strive to distill their businesses down to one page of text. In my humble opinion, three pages is too long and despite what we'd all like to believe, there is no business that is so complex as to require it. Frankly, writing a crisp exec summary is good discipline for writing a compelling sales pitch. Which brings up a question…

Guy: As an investor how much emphasis do you put on a management teams ability to communicate as demonstrated by their exec summary, elevator pitch and slide presentation? Would you invest in a team that you felt had a great idea but would struggle to communicate it to customers?

Sadly, if there were a venture capital fund that only invested in entrepreneurs that can "write thin", they'd probably have to return most of the money to investors. Such firms are rarer than hen's teeth and worth their weight in gold. Since Blackfriars' business is helping companies who aren't so gifted, we aren't complaining about their rarity, but we're glad to see someone who aspires to raise the bar on business communication.

Technorati Tags: Executive Summary, Writing, Venture Capital, puppy, Communications, Marketing

Claria strives for Web legitimacy, but doesn't have a chance

Today's New York Times has an article about Claria, who is moving beyond its Gator pop-up ad products to a new service called PersonalWeb. This new service pursues a Google-like ad model designed to garner more dollars from advertisers to target specific user interests and Web behaviors. The service requires users download a piece of tracking software and install it on their computers:

If a man, for example, downloaded the software and surfed through stories about the N.C.A.A. basketball tournament and car reviews, his PersonalWeb home page would reflect those interests the next time he clicked to it. In addition to showing newer headlines about cars and college basketball, the page might also feature ads from car companies or for jerseys from the man's favorite team.

Claria says that because those ads are so closely aligned to the user's interests and recent behavior, marketers will be willing to pay more than they might on other sites for the ability to reach PersonalWeb users.

Our take: Claria's service is doomed from the get-go. In this era of Internet virus and security paranoia, the only people who will download Claria's software are those who really have no idea what they are getting into. And since the payoff is only a personalized portal -- a commodity on the Internet today dominated by giants like Yahoo, Google, and MSN -- users have little incentive to stick with the program for more than a few days.

But even worse, Claria seems to ignore the fact that consumer experiences with Gator pop-up ads have left them with a tarnished consumer brand. And while Claria has attempted to divorce PersonalWeb from its Gator history, a quick Google of PersonalWeb -- the first step for any Internet-smart consumer -- will reveal the connection. The result: it will take tens of millions of marketing dollars for Claria to repair their brand damage before anyone is likely to take their PersonalWeb bait. And given their abortive IPO last year, no one is likely to provide them with that kind of bankroll.

Technorati Tags: Advertising, Business, Marketing, Web, Web advertising