The NY Times reports today that "TV will account for 38.4 percent of the $503 billion global ad market
this year and will drop to 38 percent of the market in 2016, according
to the forecast." A minuscule number perhaps, but perhaps more a notice of an eventual trend. Still, with the rise of digital devices, smartphones, tablets, laptops, and more, our attention has steadily moved away from the TV screen and toward the smaller devices. Mobile is in! And as we all know, nothing is truly free in this world and content is being paid for mainly by advertising.
But the digital ads that we get may not be nearly as effective as the television commercials we see. Sure both are intrusive and too, too many, but the little screens make engagement harder. Which brings me to a second article in today's NY Times entitled X Marks The Spot. These pop ups and overlays and screen cloggers make me hate the advertisers that rely on them. To say they are just a nuisance would be to truly understate how frustrating they are. No longer comfortable with being banners that rest around the content, these digital ads make getting to the content difficult at best. Not just that one has to sit through them to get to the content, but that as the article correctly states, trying to click the 'x' to eliminate them becomes a game unto itself.
But the worst for me is when the pop up ad takes so long to download, creating such a lenghty latency that prevents the actual content from also downloading, that I find myself clicking away from the site. The more this happens, the more I remember which websites I now avoid altogether, a loss for both publisher and advertiser. And as others follow on that same path, an eventual loss for the digital industry. The influx of intrusive advertising will be the means to the industry's self destruction.
Monday, December 7, 2015
Friday, December 4, 2015
Diversification For Barnes And Noble
The new CEO of Barnes and Noble, Ron Boire, has some ideas how to reinvigorate the chain. Perhaps he had the chance to read my blog 2 1/2 years ago on July 1, 2013 entitled Saving Barnes And Noble. In it, I write about partnerships and diversification to enhance and increase customer engagement with the store.
Well that is exactly what Boire wants to do, increase foot traffic by expanding its merchandise. His background with other big box stores may be useful to his revamp efforts. As today's NY Times article shares his plans, he sees the revitalization of the brand as a "lifestyle brand" and destination. I believe that there is a strong opportunity to re-brand and re-energize and that he can create a successful new type of retail opportunity. I urge him to continue to look at partnerships with other smaller chains as a means to grow. I am excited to see B&N become a must visit shopping destination.
Well that is exactly what Boire wants to do, increase foot traffic by expanding its merchandise. His background with other big box stores may be useful to his revamp efforts. As today's NY Times article shares his plans, he sees the revitalization of the brand as a "lifestyle brand" and destination. I believe that there is a strong opportunity to re-brand and re-energize and that he can create a successful new type of retail opportunity. I urge him to continue to look at partnerships with other smaller chains as a means to grow. I am excited to see B&N become a must visit shopping destination.
Thursday, December 3, 2015
Hasta La Vista DirecTv?
According to reports, the brand name DirecTv will fade away in 2016. Since being purchased by AT&T, the plan has been to create a more unified brand experience. And as a result, the DirecTv brand name will fade away to be replaced by the much longer AT&T Entertainment moniker.
Of course, if that is the case, it is likely that the AT&T U-Verse brand will also convert to the AT&T Entertainment brand. Such a switchover to the single name will take place over some time as new logos will incorporate both names until the full change takes effect.
Cable has worked hard to differentiate its corporate brand from its product brand. Comcast uses the Xfinity name while Cablevision has pushed Optimum as its cable brand. So which brand should have been kept, AT&T or DirecTv or should it have been left alone? Let me know.
Of course, if that is the case, it is likely that the AT&T U-Verse brand will also convert to the AT&T Entertainment brand. Such a switchover to the single name will take place over some time as new logos will incorporate both names until the full change takes effect.
Cable has worked hard to differentiate its corporate brand from its product brand. Comcast uses the Xfinity name while Cablevision has pushed Optimum as its cable brand. So which brand should have been kept, AT&T or DirecTv or should it have been left alone? Let me know.
Monday, November 30, 2015
Disney And ESPN Rocked By Cord Cutting
High subscriber fees, a decline in sports interest, more entertainment choices, and other challenges have rocked the world of cable television. The Disney company, a bellwether of the media industry, is feeling those changes firsthand. In the last 2 years, we learn that the ESPN Network lost 7 million subscribers, ABC Family (to be rebranded to Freeform, a mistake I believe) has lost 5 million subs, and Disney Channel 4 million. Hard to make up those revenue losses without raising advertising fees, but a smaller base doesn't help drive big increases. It is unlikely to expect a rebound as consumers continue to cut the cord and seek more OTT programming alternatives. And Netflix, Amazon Prime and others are driving them to switch with huge libraries of content ad the rise of original programming too.
For a must have network like ESPN, the rise in sports license costs, higher ticket prices to attend live sporting events, and other challenges have driven away the middle class family from attending games and building fan interest. Instead, the draw has become fantasy gambling, a short term boon but ultimately long term killer of sports, in my opinion. Television sports interest continues to draw healthy ratings, but the future generation fan may be less interested in watching. As fantasy sites get barred from advertising and used in certain states, we may in fact be watching the tipping point in sports value.
As for networks like Disney and ESPN, their challenges are also being faced by other cable networks like Fox, Viacom, Scripps, AMC, and others. Declining subscriber revenue cannot be made up easily. Increased advertising minutes have led to viewers seeking OTT choices that are commercial free. It is no longer fun to watch a show or movie that has what appears to be more ads than content. And that influx of ads, along with high cable bills, may be the two primary reasons customers are fleeing the cable universe.
For a must have network like ESPN, the rise in sports license costs, higher ticket prices to attend live sporting events, and other challenges have driven away the middle class family from attending games and building fan interest. Instead, the draw has become fantasy gambling, a short term boon but ultimately long term killer of sports, in my opinion. Television sports interest continues to draw healthy ratings, but the future generation fan may be less interested in watching. As fantasy sites get barred from advertising and used in certain states, we may in fact be watching the tipping point in sports value.
As for networks like Disney and ESPN, their challenges are also being faced by other cable networks like Fox, Viacom, Scripps, AMC, and others. Declining subscriber revenue cannot be made up easily. Increased advertising minutes have led to viewers seeking OTT choices that are commercial free. It is no longer fun to watch a show or movie that has what appears to be more ads than content. And that influx of ads, along with high cable bills, may be the two primary reasons customers are fleeing the cable universe.
Thursday, November 26, 2015
Amazon Prime Seeks To Master The Bundle
I have been known to say that history repeats itself; for good and for bad. And in the world of marketing, a good idea is a good idea, often repeated under various creative strategies. One such notion is the strategy of bundling, the art of combining items into a single, larger package. Cable television did it quite successfully, first in bundling cable channels together and offering a large selection of differentiated networks at one low price, and again in creating the triple play of cable, phone, and data at one competitive price.
Amazon has repeated that strategy with the creation of Amazon Prime, a bundle of services including same day delivery, cloud storage of photos, special offers as well as Prime Music and Prime Instant Video, all at a low annual fee. And while the centerpiece is free delivery, the additional pieces help to create strong added value. And the strategy seems to be working.
But delivery alone might not be enough and the value of content cannot be minimized. Amazon seeks to strengthen its Instant Video subscription with original shows as well, including the Emmy winning Transparent. Now,Amazon Prime seeks to expand its Prime bundle with other subscription services. According to Variety, "The retail giant has been pitching the idea to add third-party video subscription services to its Prime subscription service to TV networks and online video services, offering them Amazon’s huge Prime customer base with its existing billing relationships as an incentive." That might suggest that services like HBO Now, Showtime, or perhaps even Hulu could be added to their bundle. As cable has learned, the bigger the bundle, the more value perceived, the better to attract new subscribers to the service.
But cable has also learned what can happen when too big causes the bundled price to rise and for consumers to start cutting the cord. For cable, it has led to the new term of the skinny bundle, with a lesser number of aggregated services. As Amazon plots its growth strategy, let it also recognize that it can sometimes get too big. Controlled growth, meaningful value, at a competitive price. So far, Amazon Prime continues to make itself a valuable commodity, but if it leads to price increases then it can also hurt your efforts.
Amazon has repeated that strategy with the creation of Amazon Prime, a bundle of services including same day delivery, cloud storage of photos, special offers as well as Prime Music and Prime Instant Video, all at a low annual fee. And while the centerpiece is free delivery, the additional pieces help to create strong added value. And the strategy seems to be working.
But delivery alone might not be enough and the value of content cannot be minimized. Amazon seeks to strengthen its Instant Video subscription with original shows as well, including the Emmy winning Transparent. Now,Amazon Prime seeks to expand its Prime bundle with other subscription services. According to Variety, "The retail giant has been pitching the idea to add third-party video subscription services to its Prime subscription service to TV networks and online video services, offering them Amazon’s huge Prime customer base with its existing billing relationships as an incentive." That might suggest that services like HBO Now, Showtime, or perhaps even Hulu could be added to their bundle. As cable has learned, the bigger the bundle, the more value perceived, the better to attract new subscribers to the service.
But cable has also learned what can happen when too big causes the bundled price to rise and for consumers to start cutting the cord. For cable, it has led to the new term of the skinny bundle, with a lesser number of aggregated services. As Amazon plots its growth strategy, let it also recognize that it can sometimes get too big. Controlled growth, meaningful value, at a competitive price. So far, Amazon Prime continues to make itself a valuable commodity, but if it leads to price increases then it can also hurt your efforts.
Wednesday, November 25, 2015
TiVo Keeps Adding Subscribers
Of course this is all happening as cord cutters continue to strike at the cable operator. It seems that offering TiVo to their customers might be a good defensive strategy to keep customers from dropping cable. Internal pressures might also worry TiVo with current CEO Tom Rogers leaving his post in February 2016. How that might affect the future strategy of TiVo remains to be seen. For now, TiVo is on track to exceed 7 million homes by early next year.
Monday, November 23, 2015
Adele Has A Distribution Strategy
Whether you care for her music or not, you still must admire Adele's business strategy with the release of her latest album, 25. If the big money is in sales, then it makes sense not to rent out the music. And that seems to be what a streaming strategy must feel like. Like Taylor Swift, Adele has decided to limit her initial audience to a sale only strategy, from downloading tracks or the album to selling the physical CD. For now, streaming subscription music services like Pandora, Spotify, or Apple Music are not allowed to play her latest music. That means that fans must purchase and so far, the strategy has worked.
In the first week, Adele has sold 2.5 million copies of her album. With the holiday season just starting, the album is likely to continue to sell quite well. It seems like a smart way to maximize revenues, using a windowing type strategy to create a high demand through a particular output platform. And certainly, as sales begin to slow, the timing might become appropriate to add new platforms of distribution.
In the first week, Adele has sold 2.5 million copies of her album. With the holiday season just starting, the album is likely to continue to sell quite well. It seems like a smart way to maximize revenues, using a windowing type strategy to create a high demand through a particular output platform. And certainly, as sales begin to slow, the timing might become appropriate to add new platforms of distribution.
Saturday, November 21, 2015
NY Times Virtual Reality Delivered To The Home
I admit it, I still like getting the paper editions of newspapers. And while I also like reading breaking news on my iPad and iPhone, I most enjoy drinking that morning cup of coffee and reading the paper. Of course, the more times the paper delivery is delayed, the more I find myself ready to pull the trigger on receiving the paper editions.
Still, the arrival of an extra gift has kept me a subscriber for a bit longer. A couple of weeks ago, the NY Times was accompanied by a cardboard box, that when folded together, became a virtual reality machine. Download the app and a few videos and place your smartphone into the cardboard constructed device. Instantly you are transported into your own VR world, 360 degrees of video. Look up, look down, look left, look right and watch as the action unfurls. When others come to the house, the device becomes one of much discussion. It is a new toy. We may not use it much, be we have continued to keep it on our coffee table. At least for now it has not made it to the trash can.
What next steps does the NY Times have in store for us with this VR machine? Will they send another with home delivery? If anything, it did cause some buzz and for the print industry that is hard to come by.
Still, the arrival of an extra gift has kept me a subscriber for a bit longer. A couple of weeks ago, the NY Times was accompanied by a cardboard box, that when folded together, became a virtual reality machine. Download the app and a few videos and place your smartphone into the cardboard constructed device. Instantly you are transported into your own VR world, 360 degrees of video. Look up, look down, look left, look right and watch as the action unfurls. When others come to the house, the device becomes one of much discussion. It is a new toy. We may not use it much, be we have continued to keep it on our coffee table. At least for now it has not made it to the trash can.
What next steps does the NY Times have in store for us with this VR machine? Will they send another with home delivery? If anything, it did cause some buzz and for the print industry that is hard to come by.
Wednesday, November 18, 2015
Comcast Says No To YES
It's that time of year again and by that I mean the time of year when cable contracts expire and the game of drops and accusations start to air. To start the holidays, the regional sports network YES, owned by Fox and the Yankees, have been dropped by Comcast Cable as no renewal deal could be reached. For customers in the NY, NJ, and CT region, almost 1 million customers, that means the loss of the Brooklyn Nets on television.
According to reports, the contract has expired for some time but it has reached the tipping point today with the network dropping off the line-up. For how long, who knows. Like every other negotiation, it eventually will come back, whether in a day, a week, a month, or even after the start of the Yankees, it will come back on the air. But in the meantime both sides lose.
Is it possible that the drop could be permanent? Despite a small, but loud percentage of sports fans, sports networks are hard to drop forever. They may have some of the highest, most expensive license fees of any basic network, but the passion for the programming is always there. So watch as we get radio, newspaper, and TV ads telling us how bad the other side is in the negotiation. Programming contracts are all about the money and nothing else.
According to reports, the contract has expired for some time but it has reached the tipping point today with the network dropping off the line-up. For how long, who knows. Like every other negotiation, it eventually will come back, whether in a day, a week, a month, or even after the start of the Yankees, it will come back on the air. But in the meantime both sides lose.
Is it possible that the drop could be permanent? Despite a small, but loud percentage of sports fans, sports networks are hard to drop forever. They may have some of the highest, most expensive license fees of any basic network, but the passion for the programming is always there. So watch as we get radio, newspaper, and TV ads telling us how bad the other side is in the negotiation. Programming contracts are all about the money and nothing else.
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