Tuesday, July 31, 2007

Microsoft patents obvious idea

US patents are a strange thing. We recently consulted a patent attorney about our software product modelQED to try and determine what protection if any we could obtain for some of the more unique parts of the software. The answer we got back was not the one we were looking for. We were told that there was no chance of patenting a clever mathematical idea or software process here in the UK or the rest of Europe. However we were informed that about $30k would suffice should we wish to write (and most likely obtain) a patent in the US at very low risk.

It appears that the standards are very different on both sides of the Atlantic – so much so that even Congress is now looking at reforming the system to stop “obvious” inventions being patented.

Microsoft are sure to have an entire raft of patent and they’ve added another one into the mix in the last few days (see http://appft1.uspto.gov/netacgi/nph-Parser?Sect1=PTO1&Sect2=HITOFF&d=PG01&p=1&u=%2Fnetahtml%2FPTO%2Fsrchnum.html&r=1&f=G&l=50&s1=%2220070174117%22.PGNR.&OS=DN/20070174117&RS=DN/20070174117). This application is for an ad targeting system making use of “biometric sensors, cameras, remote controls, or other accessories” to monitor who is watching a TV or other device and adjust the content accordingly. This is akin to web surfing on a PC who knows exactly who is using it at all times.

As I’ve mentioned in the past (http://marketing-works.blogspot.com/2007/06/privacy-concerns-to-hamper-measurement.html) privacy concerns will undoubtedly throw a spanner in the works should Microsoft try to come up with a system such as this. In many ways this device would be some sort of Direct Marketing nirvana if there was a return channel to allow purchase. Obviously there is if the device is online and this is the market that Microsoft, Google and even some ad agencies are going after. However I would bet that these patents will come to little in the next five years or so. Privacy issues are becoming more and more important and “big giant head” devices that communicate with big brother aren’t exactly popular. Even if they can somehow find a way to use ad dollars to subsidise such a device, will people really embrace a new advertising channel such as “sniff you first” TV?

Monday, July 30, 2007

One line of marketing wisdom

I received an e-mail last week asking me to a blog by Matt McDonald at Penn State. Matt was after a one line quote of "all the marketing genius you can cram into one line".

See http://www.mattjmcd.com/2007/07/one-line-marketing-wisdom/

What a great idea! This is surely one of the great things that can be achieved in a blog but wouldn't happen anywhere else.

Anyway my quote went in and having seen the other wisdom out there, I can only say that maybe I'm not as wise some of the guru's who submitted ideas. However it was an honour to be asked so please take a look for yourselves. Why not submit your own quote?

Tuesday, July 24, 2007

Great presentation - The Brand Gap

May people will have seen the attached presentation called "The Brand Gap". For those that haven't, take a look. There are some great points here about what makes a great brand and how might you help achieve this for your organisation. I love this deck...

Sunday, July 22, 2007

Tag cloud for this blog

Here is a tag-cloud from this site. It allows you to search for context in certain words and is lovingly brought to you from IBM's "Many Eyes" service.

Saturday, July 21, 2007

Harry Potter - has retail marketing gone mad?

As almost all those of us on planet earth are probably aware, the last Harry Potter book was just released at midnight on the 20th of July. In the week leading up to the books release, there has been lots of media chatter about this book launch – more than I can remember for some time. I’ve not read the books so I can’t vouch for their brilliance but one thing that is obvious is that the publisher Bloomsbury has lost control of the marketing associated with this launch.

Up until the final day, Bloomsbury have been keen to keep the final chapter of this saga under wraps. Embargos and security were used as methods for preventing publication and spoilers have been showing up online for weeks. In other words this is certainly a hot property that everyone was after.

Given this, how much discounting do you think would go on during DAY 1 of publication? 10%? 20%?

Even before publication, ASDA Walmart were talking up a massive 51% discount in the media that had led to a clash with publisher Bloomsbury (see http://news.bbc.co.uk/1/hi/entertainment/6902031.stm) . Small bookshops were complaining that at such a discount, it was cheaper for them to go to the supermarket to purchase stock than it was to go to the publisher direct. That puts the “cost” of each book at something approaching £9 here in the UK.

Imagine my surprise when I got to the shops today and saw even greater discounts on day 1. At WH Smiths they were offering a conditional discount of 61% off the cover price taking the price down to £6.99 – in other words they were almost certainly making a loss (something WH Smiths has specialised in during recent years). Further along in the shopping centre, the department store John Lewis was selling the book for £5 with no conditions. In other words, they were subsidising customers purchases to the tune of almost £4 per book. Given the threat that there was no coverage of this pricing to be seen at the front of the store and that John Lewis doesn’t usually stock books, I really wonder what kind of marketing tactic they thought they were employing?

So – Day 1 of a long awaited book release and the discounts are reaching epic proportions of 72% from list price. It’s not great news for Bloomsbury – I saw people purchasing multiple copies of the book and they are already showing up on ebay at inflated prices. Is it any good for the retailers? Well unless they are bringing in substantial new customers to their shops, one would assume it is not. Whilst Asda may have benefited from some early publicity, I doubt that the other retailers actually got the message out to consumers to tell them that they were going to offer even more generous subsidies discounts.

My take – the “me too” retailers were daft. In terms of marks out of 10, Asda get 7/10 because they let people know they were going to sell at cost, WH Smiths get 5/10 because at least their offer probably ensured a profitable transaction because of their use of link savings. John Lewis get 1/10 – a real stinker. Offer a book that you wouldn’t normally sell WAY below cost and then forget to tell people that you are doing this “one off” special. In other words – if you were going to buy this book elsewhere, why not get it from us and have some free money. It’s not going to build any loyalty and almost certain to lose them money. Poor.

More Potter Marketing and Economics Posts:
Drew McLellan - What is the cost of being right? http://www.drewsmarketingminute.com/2007/07/what-is-the-cos.html

Seth Godin – Keeping a secret - http://sethgodin.typepad.com/seths_blog/2007/07/keeping-a-secre.html#trackback

Megan McArdle - Harry Potter: the economics - http://commentisfree.guardian.co.uk/megan_mcardle/2007/07/harry_potter_the_economics.html

Greg Mankiw’s Confession - http://gregmankiw.blogspot.com/2007/07/i-confess-i-am-potter-head.html

Friday, July 20, 2007

Top economist signs for Google

The economics grads amongst us will be familiar with Hal Varian. He wrote one of the standard textbooks on microeconomics if memory serves me right. Anyway he’s now joined Google as their Chief Economist (see http://blogs.wsj.com/economics/2007/07/19/economics-according-to-google/ ). In the article Hal argues that the marketing world is about to see a load more economists joining ready to do battle with our mountains of data and bring better forecasting and measurement to marketing. Whilst such a trend would be welcomed by many, there is a depressing set of people in the industry who will be uninterested in what these economists might have to say for themselves.

In the past few years, I’ve seen a number of economists move from marketing into corporate finance (I’m talking about at the coalface level here) – I’ve never seen the reverse happen. We can only hope...

Why call yourselves marketingQED?

I've been asked on a couple of occasions why we chose the name marketingQED for our business venture. For those that don't know, QED stands for "quod erat demonstrandum" - Latin for "which was to be demonstrated" or "which has been shown".

We are using the name to suggest that we can "prove" or "demonstrate" the effectiveness of marketing - a fairly bold claim but an achievable one.

Will we stick with the name until the end of time? I don't know. There's much more to business success that a good name. Given that many people have questioned me about the name, I'd guess that there is less understanding of the term QED than I thought. Therefore we may need to change the name at another stage.

Anyway what has this got to do with marketing effectiveness? The answer is that it very little except that we're listening (a good tactic if you want to be successful they say). A brand isn't a funky name (or a poor one come to that) but it does add to first impressions. To be effective at marketing, you've got to be prepared to change horse mid-race if that's what your judgement is telling you. At this point, we're going well but only into the first bend......

Update on modelQED

Just a quick update to let you know how modelQED has been received in the marketplace.

We're really excited by the reaction we've had to the modelQED application that we just released onto the market (click here for details). When we demo the product, people instinctively "get" it and that's a great feeling. Two comments particular stand out for me:

1) "It's a Ronseal job" - this comment was made by the head of a major UK consultancy who understood that we're not trying to reinvent the wheel by making an uber-complex analytical tool. We're pragmatists and we try to be honest in our conversations with clients. Hopefully this is paying off. (FYI - Ronseal is a UK brand of consumer decorating materials famed for it's advertising tag line of "It does exactly what it says on the tin)

2) "It's amazingly beautiful" - a verbatim comment (honestly) from the head of a US agency who felt that our product was both easy to use and intuitive. This felt great because we've really tried to make our product easy to understand for an analyst. Try using standard SAS or SPSS charts to present information and you'll understand why we spent lot's of effort on "look & feel". It's not that they can't make great charts that tell a story but it takes a lot of effort.

We've still got things to improve and we're not being complacent. However it's our baby and we're proud. If you haven't seen the product and want a trial, go to our website and request one. No obligations. That way you can judge the above comments for yourself!

Tuesday, July 17, 2007

New Heros - Zoho

Both Google and Microsoft are determined to move our applications online so that we have seamless access to our powerpoint / word / excel documents (yes I used the branded terms rather than presentation, authoring / spreadsheeting products) but there is at least one key competitor who is doing things differently – Zoho.

I’ve used Zoho apps for various things – if you purchase our modelling package, you will find that you can report a fault online via our website. It’s Zoho that powers this reporting and e-mails us your issues. We are likely to replace this code with our own once we get time but Zoho enabled us to get up and running in a quick and efficient manner.

The other thing I like about Zoho is that the apps are constantly being updated. Within any given week, new features are released as and when they are ready and these guys don’t hang about. Compare that to Microsoft or Google who release big packs as and when they feel like it. Zoho feels like a nimbler and humbler organisation and i’d back them to succeed for a while vs. the behemoths. Of course at some point, I assume that someone with BIG pockets will purchase them and make some real money from this business.

Monday, July 16, 2007

Poll added

If you're reading this online (as opposed to via an RSS feed), you will notice that I've added a poll to this blog (see right). Please take a second to let me know what topics you'd like me to write more on.

Let me know,


Tuesday, July 10, 2007

Quote of the week "At least CMOs don't do harm"

Adage are reporting that a forthcoming article in the Journal of Marketing research has reached the conclusion that it"...is important to note that CMOs do not have a negative impact on performance".

OK - slightly taken out of context. The gist of the research is suggesting that there is no conclusive proof that the presence of the CMO on the board of big organisations adds significantly to business performance - at least not on the tangible metrics such as sales or profitability.

The study won't be published until January so until then, you'll just have to read the Adage article. One word of caution - Adage uses the term "correlation" a lot in the article. Given that correlation could relate anything to anything else, read this one with care!

Wednesday, July 04, 2007

RANT - what dese "Unlimited" mean to you

OK - it's time for a rant.

Mobile phone operators and broadband suppliers are advertising a range of "unlimited" services that are actually limited by "fair usage" policies. What they don't tell you is what "fair usage" actually constitutes. This is dishonest practice and does them no favours at all.

And no point running to the Advertising Standards Authority if you want to question this. Last month they rapt Orange on the knuckles over their unlimited data claim because they forgot to add small print saying that 40mb was a fair use cap (see http://www.theregister.co.uk/2007/07/03/government_dodges_unlimited/)

Note that the ASA "...exist to make sure all advertising, wherever it appears, meets the high standards laid down in the advertising codes".

As a brand, Orange continue to disappoint and is there any marketing that can be as ineffective in the long run as dishonest marketing?

Addendum: http://uk.gizmodo.com/2007/07/04/uk_broadband_hits_new_low.html
Dissatisfaction grows with broadband suppliers - esp Orange. Note that Orange was one of the greatest brands ever created. It's a sad state of affairs....