When Spokespeople Get Fired

The world of advertising with celebrity endorsements, funny catch phrases, and ordinary spokespeople, all try to capture the attention of the public and convince us that the product or service offered is the best one.  Over the years, a large number have become quite memorable, from Tony the Tiger for Frosted Flakes to Jared for Subway, some good and some bad.  And of course some great catchphrases too, from "Where's the Beef" to "Can You Hear Me Now?"

Yet advertising is a tricky business and nothing ever goes as planned.  Who would know that Jared would go from losing weight on Subway sandwiches to child porn.  But once a connection is made between performer and endorsement, managing that relationship, even when the campaign is stopped for a new direction, is a tricky business.  So I wonder why Verizon, who made their name on their spokesperson saying the phrase "Can You Hear Me Now", one that truly resonated in the annuls of advertising, would not have kept their young spokesperson on some kind of exclusive retainer.  Instead Verizon got a slap in the face.

The original...



And now...



Does AT&T have to worry about their young spokesperson "Lily, does Activia have to worry about Jamie Lee Curtis, or does it pay to keep them under some exclusivity?  Verizon certainly will find out if Sprint has caught them napping or not.

Goodbye Cablevision, Hello Altice

I started my ad sales career at Cablevision of Boston, a Charles Dolan business that was a part of the Cablevision Systems empire.  I left and rejoined Rainbow Media, a subsidiary of Cablevision and the network side of the business.  There I worked with cable networks like Bravo and IFC; eventually, more networks and responsibilities were added to my job description.  I watched the industry move from start up to mature and was sad when the Boston system was sold to Comcast and especially when Bravo and half the team I worked with was sold to NBC.  Eventually I was downsized too and left the Cablevision team.  Since then, Rainbow left Cablevision to become a standalone business AMC Networks, just as MSG did the same.  And today, Cablevision itself has officially sold itself.

The cable industry continues to mature.  Where once it was the upstart competing with broadcast; today, it is grouped with broadcast and competes with streaming.  Those early days were quite special and money flowed freely.  Business trips, management conferences to amazing locales, turkeys at Thanksgiving, stock options and more.  But as accountability tightened up and profit margin mattered more than employees (or even customers), many of those perks were dropped. 

I look at my career as I look at my life as chapters in a book still being written.  Those early chapters with Cablevision and Bravo/IFC were amazing.  I think back to them at times and smile.  To see the company that I spent more than 15 years with become no more does make me feel a little sad.  No regrets though as one must continue to keep writing the new chapters in living one's life.  Who knows what the next story will look like. 

Screens Bigger, 3D Blows According To Katzenberg

Speaking at CineEurope, Jeffrey Katzenberg, CEO of Dreamworks Animation, stated what we all know.  3D is gimmicky and used poorly while movie goers really prefer bigger screens, per Variety.  I couldn't agree more. 

I have always found 3D movies distracting, even when done on films like Avatar.  The glasses used are uncomfortable and the screen is more likely to strain the eyes then produce a better picture.  Instead, theater owners that have spent capital improvement on bigger screens, better seats in a stadium style arrangement, and a superior audio experience, have hopefully found consumers coming back again and again. 

At the same time, the price point used to buy a seat must remain reasonable, especially for a family outing.  If you price too high, these customers will find their home theater experience more than adequate.  Recently, I took our family of 4 to the movies.  Using Flixster, we bought the film, theater time and exact seats.  When we got to the movies, we only had to wait to pick up the printed copies.  No waiting in lines, no wondering if the movie was sold out or if we would find seats together.  At the same time, the cost for tickets, including the Flixster fee, exceed $50.  Add a stop at the refreshment stand and many families will be using their entire monthly entertainment budget. 

 Some movie houses have added more dinner options to encourage consumer spending, others have arcade areas to catch a few quarters more.  Ads before the movies adds more revenues.  One ad especially caught our attention.  It was for a production of One Man, Two Guvnors that had been filmed during its Broadway run and would be run in the theater.  An interesting way to add more options to what a movie screen can deliver.  As for the movie industry, continue to build a better destination experience, especially inside the auditorium and movie lovers will continue to return.

Spectrum vs Xfinity vs Optimum

It's official!  Time Warner Cable and Bright House Networks are part of Charter Communications.  And with the merger will come new marketing intended to forget the old brand and think only good thoughts of the new cable company.  And the name Charter has chosen to market cable, phone and data is Spectrum.  If you think you have seen that name before, you have.  The Flyers and Sixers once played in the Spectrum.  There once was a cable network called Prism (sounds like Spectrum a bit) and there is a company already called Spectrum Brands.

Of course the notion of renaming its services under a different brand name comes right from the cable playbook.  Comcast introduced us to their Xfinity brand while Cablevision started it with its Optimum brand.  Whether Altice decides to keep that name once it acquires Cablevision in the next month or so remains to be seen.  Still, the strategy has proved a successful one.  Many people have no idea that the brand and the company are the same.

Can Charter take the Time Warner Cable properties and upgrade them and thus help improve their service and reputation?   Current TWC customers, especially in California, hope so.  If cord cutting doesn't kill them first, an opportunity to regain consumer trust and build a world class operation could certainly be possible.  We will have to wait and see how Charter Communications takes on this acquisition and invests in its infrastructure. 

Self Driving Cars To Combat Texting While Driving

With my son learning how to drive, I tend to say ad nauseum to watch out for the other drivers.  And it amazes me to watch how horribly others drive.  Sure, know one wants to start an accident, but I see daily drivers holding their cell phone by their wheel, looking down as they drive.  It makes their driving erratic and as my neighbor learned the hard way, caused an oncoming car to swerve into her lane and hit her.

The law may tell us to not text and drive and to keep our cell phone in our pocket, but the buzz and ring are Pavlovian, resulting in a desire to take them out and look at them.  We are all guilty.  It seems the current law may not be working no matter how many tickets the police may give or how many accidents are the result.

It may just be time to quickly embrace self driving cars.  If we can't control our impulses to text and drive, then we need our cars to be our friend and drive for us.  Uber without a driver.  For every life we save or accident we prevent, the better our self driving car experience will be.  For us and for others on the road.  But until all cars are self driving, put the cellphone away while driving and for your sake if not others, stop texting and driving. 

Less Commercials To Save Linear Television

We gravitate to streaming services like Netflix and Amazon Prime so that we can watch our video content when we want and how we want, without commercials.  It has been the rise in commercial minutes per hour that has hastened the departure of viewers from linear TV. But perhaps slowly, networks are recognizing that too many commercials may be a wrong play.

Starting next year, Saturday Night Live, an NBC late night staple for 40 plus years, is reducing the number of commercials by 30%.  According to Ad Age, "It will do this by removing two commercial breaks per episode, giving viewers more content, said Linda Yaccarino, chairman-advertising sales and client partnerships, NBC Universal."  In addition, it will also use branded original content to drive ad revenue.  It may not be as blatant as Jack Benny selling Lucky Strike cigarettes or Jello, but it will certainly attach a particular brand to real content.  Certainly more appealing than most of the commercials that currently air.

The article also adds that other cable networks are also considering reducing ad load.  "Viacom and Turner are also working to reduce the number of commercial minutes in prime time."  Let's hope that more follow.  And while the cost of an ad may rise, so too may be the number of viewers that stick with a linear show and continue to watch. 

Viacom Couldn't Risk Losing Dish Carriage

For all the craziness surrounding Viacom these days, including the health of founder Sumner Redstone, dealing with a potential Dish drop might just have been the death of Viacom.  Luckily, MTV, Comedy Central, and the other Viacom channels will continue to be enjoyed by the 14 mm Dish subscribers.  According to Deadline, the programmer agreed to multiple demands, including channels that "will run on the satellite company’s Sling TV streamed service."  An important need to build value as a TV Everywhere provider.

And while other terms weren't announced, one must wonder if a price increase was also passed through.  Given the threat of cord cutting, it gets harder and harder to keep passing those costs on to the subscriber.  There is now a greater need to find revenue growth through more advertising and other assets.  Sling TV counts as one more way to drive growth and customer satisfaction to the Dish customer. 

Netflix Slower Growth A Challenge

Like a good multi-level marketing ploy, its hard to grow endlessly before reaching a max.  And while Netflix has exceeded 81 mm worldwide streaming subscribers, each paying a healthy monthly fee, the growth curve is flattening.  That means the challenge to keep growing at double digit rates seems no longer possible.  And it may be harder and harder to find the next new sub especially as prices rise and future customers need more incentive to join.

The future is international, but there are risks too.  Can Netflix find new revenue streams to drive business growth?  Will they need to start cutting some costs to improve profit yields?  Has the market hit some maturity that could lead to upstarts taking some of the Netflix business away? Will Netflix need to keep spending more for original content and better libraries of content to compete against Amazon and others, thus hurting profit margins?  And while current subscribers are very happy with Netflix and thus not dropping the service, can Netflix add incremental value and revenue without hurting the bottom line?

These are the challenges facing the streaming industry and Netflix in particular.  It is hard to keep growing at these previous amazing rates when the market hits saturation.  Add changing interests and other internal and external forces, and the business model is continually challenged.

Amazon Prime Has Unbundled

For those cord cutters who don't want to pay $99 a year for Amazon Prime and its entertainment video package, Amazon is offering a monthly rate instead.  For only $8.99 a month you can subscribe to the service with the ability to cancel anytime.  And according to Techcrunch, "You can also choose to subscribe to Prime for $10.99 per month. You get access to expedited shipping, Prime Video, Prime Music, the Kindle Lending Library and probably a bunch of other stuff that I’m forgetting."  If cash flow is your issue, the new Amazon offering provides a smaller monthly fee. 

But if a $99 yearly cash outflow doesn't hurt your pocket, the simple math proves that buying the annual membership is the better value of about $10 for the video only package, $32 more for the full package of Prime services.  Heck if Netflix offered an annual discounted payment, they likely would find a strong conversion by existing subscribers although a lower revenue stream. 

Will the new payment structure encourage new subscribers to try the Amazon Prime service?  There is certaily no savings if all you wanted was the video offerings.  Given the pricing, it seems like you might as well pay the higher fee and add books and music to the mix. 

I am not an Amazon Prime customer.  I don't buy that much from Amazon to see value from the expedited shipping and have yet to find a must-have show that would drive me to purchase.  I do believe the ultimate driver for Amazon Prime is geared to those that utilize them frequently for purchases.  The entertainment library is the added value to the package.  I would love to see a comparison of Amazon Prime to Netflix and Hulu for number of monthly streams and hours per household utilized to see how each service is treated among its subscriber base.  Given the proprietary nature of the business, I doubt that info will ever be shared willingly.