Monday, June 2nd, 2014

Ralph Roberts’ Favorite Saying

ralph Ralph Roberts founded Comcast before handing its reins to his son, Brian L. Roberts. Here’s how Ralph describes his business’s core idea:

I didn’t burn any bridges with Muzak when I left there, and my brother, who unfortunately passed away in 1972, had been the advertising director at Revlon and had a similar career to mine. He was also in advertising and marketing, and Muzak Corporation, after I had left for some time, invited him to come over to be a senior vice-president of the company, and one day he came in to me and he said, “You know, Ralph, we ought to buy some of these franchises. They’re a license to steal as recurring monthly income.” That was our favorite expression, just like cable. You put in the equipment and every month they send you money.

Such is the true stuff of the great private-sector boondoggles.

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Posted by Michael Dawson | Filed in Bad Products, Behind the Scenes | 24 Comments »

Thursday, May 15th, 2014

FCC Surpasses Orwell

orwell-truth Zerobama promised his suckers constituents net neutrality. They are getting the exact usual. Per The Wall Street Journal:

The Federal Communications Commission advanced new Internet rules that would ban broadband providers from blocking or slowing down websites, but allow them to strike deals with content companies for preferential treatment.

So, those who own the roads can’t slow somebody down, but can sell access to faster routes? Only in America, folks, does such blatant DoubleThink get reported straight out, without the slightest snicker or blush.

Of course, how do Comcast and its soon-to-be-acquired “rivals” own the road? Graft, pure and plain.

And check out the ultimate Obamian trick the FCC is now using to finish sealing the deal:

The broadband providers have signaled that they can live with Mr. Wheeler’s approach as drafted.

Democratic commissioners Jessica Rosenworcel and Mignon Clyburn joined Mr. Wheeler in voting to advance the notice of proposed rule-making, which will now be open to public comment for 60 days, followed by another 60 days for replies.

Observers expect unprecedented engagement during the comment period, but it remains to be seen how much the final proposal shifts from what Mr. Wheeler has already proposed. Mr. Wheeler’s proposal assumes a strong FCC would aggressively police deals between providers and content companies.

Yes, it certainly does remain to be seen. Any wagers?

Meanwhile, here’s what the WSJ says about the Democratic Party:

Democrats are largely in favor of net neutrality but still divided on the best approach, with a few favoring reclassification and others still on the fence. Mr. Wheeler’s approach also has found favor with some Democrats who worry reclassification would kill investment in broadband deployment.

Translation? Five words: “The Democrats oppose net neutrality.”

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Saturday, April 26th, 2014

A Needle from the Haystack

Guess what. There is one actual journalist working in the United States! Who’d have thunk it?

Logically and probably necessarily, he is based in the epicenter of imperial decline, Detroit, Michigan.

In any event, check it out, and compare this with what passes for reporting in every other outlet, where brains, real questions, and major non-elite topics are banned:

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Posted by Michael Dawson | Filed in Eyeballs and Eardrums (The Media), Lifelines | 5 Comments »

Tuesday, April 8th, 2014

The Usual

doughtrain According to a Wall Street Journal report on the latest Commerce Department statistics, the system is functioning normally:

U.S. corporate profits hit new highs last year, driven by the tight lid firms have kept on hiring and spending almost five years into the economic recovery.

A closely watched measure of after-tax corporate profits rose to $1.9 trillion in the final three months of the year, the Commerce Department said Thursday. Corporate profits stood at 11.1% of gross domestic product, up a bit from the prior quarter.

The latest uptick underscored a factor that has dogged the economy since it emerged from recession: Many companies are guarding their cash rather than putting it back into the economy in the form of new hiring.

The normalcy extends in all the usual directions, too.  According to Advertising Age, big business marketing also grows apace:

Why would major U.S. corporations keep a tight rein on almost all costs last year — except advertising?

By continuing their firm grip on hiring and spending, U.S. corporate profits reached new highs for 2013, The Wall Street Journal reported.

Advertising expenses, at least for the top 1,000 companies, was the exception. According to Kantar Media, the biggest marketers boosted spending 3.3%, while smaller advertisers cut ad budgets 6.6%.

What’s going on?

Maybe companies figured it was cheaper to spend money on advertising than to invest in research and development to try to stay one step ahead of the competition.

But that meant advertising’s job [even more] often was to divert attention from the product itself and toward emotional and purpose-driven benefits.

What’s going on? As one of the fake product differentiators says in its ads, it’s not complicated: Corporate capitalism is succeeding at serving its one and only purpose.

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Posted by Michael Dawson | Filed in Corporate Capitalism, Corporate Marketing 101 | Comment now »

Saturday, March 29th, 2014

Forbearance as Subsidy

Why doesn’t the IRS allow everybody to file their tax returns online for free? The answer, of course, is the same as in the case of the lack of regulation of cable and internet access: Forbearance from obvious and efficient public answers allows economic waste/corporate profit ranching. By keeping the IRS from running its own e-file system, the overclass is able to sell the simple software needed for that task at high, annually repeated prices.

Meanwhile, Leslie Savan, who advises BBM critics to “follow the flattery,” must be laughing herself silly watching the insipid, truth-concealing pitches of the resulting rip-offs:

Aside from the sickening spectacle of watching the self-same corporate oligopoly that lobbied to block simple reason flatter its victims for remaining ignorant of such basic realities, one has to ask: Why not just fill out the paper forms? TurboTax costs at least $50. A stamp is now 49¢.  How amazingly dumb is it to prefer the former to the latter?

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Posted by Michael Dawson | Filed in Bad Products, Commodification | Comment now »

Thursday, March 27th, 2014

How Irrelevance Serves Monopoly

In the United States, our overclass has used its ownership of politics to prevent serious regulation of communications infrastructure, to say nothing of public ownership. As a natural result, we get the highest prices and worst services in the supposedly developed world.

Of course, a small part of the gargantuan cash geysers the overclass reaps from such a sweetheart set-up is used in marketing the overpriced, inferior products underlying its profit ranches.

Having no rational product differences or genuine technological breakthroughs to describe, such marketing is always mere empty manipulation.

Consider this perhaps familiar example:

How, one might wonder, could such unfunny and ham-handed irrelevancies be profitable to AT&T? What’s the business rationale? Is AT&T stoned?

Turns out, as always, not in the least.

Per an Ad Age story titled “How Big Data Shapes AT&T’s Advertising Creative,” there’s rather rigorous method to the apparent superfluity:

It’s Not Complicated” may have been its name, but the insights that drove one of AT&T’s most successful ad campaigns ever were based on a massive three-year big-data project that was plenty complex.

The campaign featuring comedian Beck Bennett and little kids in a classroom was the product of a three-year project. It involved an analysis of 40 copy-test variables and tagging 370 AT&T and competitive wireless communications ads on everything from the type of humor used and how characters interact to type of storyline.

The BBDO-created campaign that resulted from the analysis generated an additional $50 million in sales in AT&T’s estimation, said Greg Pharo, director-market research and analysis for the telecom in a presentation at the Advertising Research Foundation’s Re:Think 2014 conference in New York today.

Here’s how that happens, per Ad Age‘s report:

Mr. Pharo and AT&T Senior Data Scientist Damon Samuel, who made the switch from working on the telecom company’s marketing-mix analytics team to working on the project, delved into sometimes surprising details about what works and what doesn’t in their ads and those of rivals. Among the lessons:

-Ads with storylines are very effective

-Informative demonstrations boost ad performance

-Simple outperforms complicated

-Slice-of-life and transactional or promotional ads can both work

-Humor is effective at driving recall, brand favorability and likeability, but not all types of humor are equal

-Character interaction matters a lot

Of course, some of those lessons have guided TV advertising since Mrs. Olsen was pouring coffee for Procter & Gamble Co. and Folgers in the 1960s. But AT&T’s analysis has helped delve deeper into exactly how elements work, particularly humor.

The team, along with its market-research shop Added Value, painstakingly code commercials for such things as the type of humor. And they found, according to Mr. Pharo, that ads featuring humor deemed clever, sarcastic or snarky tend to outperform ads with silly humor (though Mr. Samuel noted that ads with darkly sarcastic humor tend to underperform).

While ads with storylines do better generally, those with complex storylines, too many scenes or vignettes and complicated visual montages “underperformed very significantly,” Mr. Samuel said. “Thirty seconds is just not enough time to share all the story elements and come to a resolution.”

Particularly effective are ads with informative presentations when a character explains the benefits and presentation of a product, Mr. Pharo said.

While people demonstrating product benefits works, just showing phones and benefits, or what Mr. Samuel termed “phone porn,” doesn’t. At best, such primitive product demos drive a shift in the mix of handset types sold without increasing total sales.

The rewards for AT&T are substantial, Mr. Pharo said, with the project showing that 25% of AT&T’s total sales are driven by media advertising and 10% from TV alone. Creative quality and tonality rather than media weight or placement account for a third of TV ads’ impact.

Such are the building blocks of our market-totalitarian culture.

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