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August 2008 | |
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Market Data Facebook tops 132 Million UsersPopular social networking site Facebook now has 132 million users, 63% of which are outside North America. (Business Week August 08) App Store for iPhone: Apple's New, High Growth Online Market PlaceiPhone users have downloaded more than 60 million programs for their Apple iPhones in just 30 days, using the new App Store section of Apple's iTunes online store. App Store was launched at the same time as the iPhone 3G on July 11th. Its applications run on the wireless-enabled iPod touch devices as well as iPhone. While most of those applications were free, Apple sold an average of $1 million a day in applications for a total of about $30 million in sales over the month. This is important for developers, since Apple's customers have shown themselves willing to pay for digital downloads. There are currently over 1,700 iPhone applications on App Store - about a quarter of them free. Enterprise software companies Oracle and Salesforce.com are making some applications iPhone-ready. Apple CEO Steve Jobs said he expects to see App Store sales hit $500m before too long. (Wall Street Journal 11 Aug 08 and Financial Times 13 Aug 08) Olympics Sponsorship and Endorsement SpendingAn estimated $2 billion is being spent on sponsorship and endorsements related to the Beijing Olympics. One of the reasons for the high spend is the wish to market to China's approximately 300 million "middle class" citizens (the other 1 billion or so don't have much money). Olympic Gold for NBC TVNBC, the American free-to-air TV network which paid $894 million for the right to broadcast the Beijing Olympics in the USA, had it's largest Saturday night television audience for 18 years during the Beijing Olympics. 39.9 million Americans tuned in to watch Michael Phelps's eighth gold medal win, when the Americans swam in their medal-winning medley relay on 16th August, according to Nielsen Media Research. The Games have drawn an average audience of about 30 million a night on NBC itself, millions more on NBC's cable channels, 30 million unique visitors to NBC's Olympics Web site, 6.3 million shared videos from the coverage streamed on the site and an ultimate profit that network executives project will surpass $100 million. (New York Times 18 Aug 08) Spending on Gadgets Defies US Economic GloomAlthough the USA is apparently on the brink of recession, consumer electronics sales grew by an annualized 4.8 percent in July, according to US government estimates. Sales of furniture and home furnishings were down by nearly 5 percent, while clothing sales managed a meager 0.9 per cent rise. (Financial Times 17 Aug 08)
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| Back to top | What Happened. Olympic Sponsors and PartnersThere are 12 worldwide and 21 local sponsors and partners of the Beijing Olympics. How many can you name? (Beware of the "guerilla marketing" experts. For example, despite being on the clothing of a huge number of competitors, Nike is not a sponsor of any kind.) Worldwide Olympic Partners Local Olympic Partners (China Only) Other sponsors and endorsed suppliers at the Beijing Olympics Dell CMO the Highest Paid in USAA survey of Chief Marketing Officers among 100 of the largest US companies shows an average salary package of US$1.5 million. The highest paid CMO in 2007 was Mark Jarvis, Chief Marketing Officer at Dell, whose $15.5 million package includes use of a private jet to help him commute between his home near San Francisco and the Dell offices in Texas. (Advertising Age 28 July 08) Apple Stockmarket Value Beats GoogleApple eclipsed Google as Silicon Valley's highest valued company for the first time at the close of business on 13th August 2008. The total stockmarket value of Apple's shares was $158.84 billion, $1.5 Billion higher than Google's $157.23 billion, but a small lead in percentage terms. When Apple's company value overtook rival PC-maker Dell two years ago, Apple's Steve Jobs sent out an email to all staff, reminding them that Dell's founder had once predicted Apple's imminent demise. "Team, it turned out that Michael Dell wasn't perfect at predicting the future," wrote Jobs. "Stocks go up and down, and things may be different tomorrow, but I thought it was worth a moment of reflection today." While Apple has been growing strongly in all areas of its business in 2008, the advertising-dependent Google has seen a significant slow-down in advertising growth this year. Apple's revenue for the six months to 30th June 2008 was $15 billion, generating net income of $2 billion. Google's revenue for the same half-year was $10.5 billion, generating $2.5 billion net income. Big Brother Dropped in AustraliaThe Australian version of the Big Brother reality TV show has been cancelled by the Ten Network, and the last of 1316 episodes ran at the end of July. Although local versions of the show runs in almost 70 countries around the world, Australian audiences are felt to have moved on to other things, not least internet-centric pastimes. Google's StreetView of AustraliaGoogle has now released Street View for Australia. Accessible through Google Maps, Street View enables you to "walk down" most streets in metropolitan cities in Australia and have a photographic view of the street, houses, etc. Google claims that all images on StreetView are at least 6 months old and that faces and car number plates have been blurred wherever possible. (To prevent embarrassing wrong-place-at-the-wrong-time revelations...) Microsoft to use Comedian Jerry Seinfeld in $300m Advertising CampaignMicrosoft is paying Jerry Seinfeld an estimated $10m dollars to feature in a big advertising campaign set to launch on September 4th. The campaign is intended to counter boredom with Microsoft's image while also trying to reassure consumers who are worried by reports of dissatisfaction with the Windows Vista operating system. Microsoft's Seinfeld campaign will also feature Bill Gates. A couple of years ago Jerry Seinfeld featured (alongside Superman) in an advert for American Express. He also appeared in a one-off advert which Apple ran during the final episode of his sitcom 'Seinfeld': 'Windows, Not Walls' is rumored to be the likely theme of the campaign. The adverts have been created by Crispin Porter + Bogusky (based in Miami), who are part of MDC Partners. Previously, Microsoft had been using McCann Erickson to create its main brand advertising campaigns.
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| Back to top | Random Thoughts - The Record Business 60th Anniversary of the LP - Music Business LandmarkOpps! We almost missed it. 60 years ago - the 12-inch (30 cm) Long Play (LP) 33 1/3 rpm microgroove record album was introduced by the Columbia Record Company at a dramatic New York press conference on June 21, 1948. In February 1949, RCA Victor released the first 45 rpm single, 7 inches in diameter, with a large center hole to accommodate an automatic play mechanism on the changer, so a stack of singles would drop down one record at a time automatically after each play. During the press conference a "Revolutionary Disk Marvel" was unveiled in front of about 40 journalists. At the Waldorf Astoria in New York, the president of Columbia Records took out a 78 from an eight-foot high stack, and proceeded to play a symphony. The music stopped after four minutes. He then went on to take out a 12in "long player" - as Columbia had decided to call the new records - from a 15in high stack and placed it on a specially adapted phonograph. The same symphony boomed out, but this time it lasted for more than 20 minutes. The company claimed "a new era had come to the record business". Not much in the music business has changed in one respect: as soon as the "long player" was launched, there was a format war. Furious at Columbia grabbing all the attention, rival RCA launched a competing format - the seven-inch, 45rpm single. The 45's maximum playing time was almost identical to the 78 rpm discs, and the "singles" record market was born. All-time Top Selling Record Albums - Defining the Baby-BoomersThe LP was the product which serenaded most of the baby-boomers through their youth. Michael Jackson's Thriller, released in 1982 is probably the highest selling LP recording of all time, with a reputed 105 million copies of the album being sold across all formats. Given that CDs started to become widespread towards the end of the 1980's it is probable that many sales were "double-ups" of people who bought the LP getting it in the new format. The next highest selling albums are AC/DC's "Back in Black" (1980), the soundtrack to "The Bodyguard" movie, featuring Whitney Houston (1992), The Eagles with "Their Greatest Hits (1971–1975)", released in 1976, the soundtrack to "Saturday Night Fever" featuring the Bee Gees (1977), and Pink Floyd's "Dark Side of the Moon" (1973). All of these albums sold between 40 and 42 million copies, again, mainly in vinyl LP format. A little maths on these sales peaks will confirm that the LP was one of the defining products of the Baby-Boomer generation's youth. Madge and Jacko's Half-CenturyOn the subject of historic events in the music business, two very famous Baby-Boomers - Michael Jackson and Madonna - both turned 50 in August 2008.
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| Back to top | Just for Fun - Jokes Why will a vampire never bite a lawyer? The man's pet rattle snake was so sick it couldn't shake its tail, so he took the pet to the vet. 'What's the matter with my snake, Doctor?' he asked. ---- How do you keep a blond busy? --- Did you hear about the mechanic who was addicted to brake fluid? He said it was no problem — he could stop any time. --- As engineers say - if it ain't broke, it doesn't have enough features yet. |
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Falling Currency Values and the Price of a Big MacFollowing a substantial decline in value during most of 2008, the US dollar has risen strongly against other currencies in the last few weeks. The UK pound is experiencing its most sustained slide against the US currency in 37 years, and there may be still more to come. Using one of the classic "apples for apples" currency benchmarks, a Big Mac at McDonalds right now (in mid-August 08) costs US$3.57 in Chicago against US$4.26 in London and US$3.27 in Sydney (down from US$3.64 in July, thanks to the falling Aussie dollar). Why does this matter to marketing people? If you work for a US multinational, most companies set internal exchange-rates (sometimes called the "planning xrate") on a quarter-by-quarter basis. Those companies which manage their marketing budgets centrally, allocating money out from a central pool of US dollars, translate the actual budget available to a country marketing budget each quarter into local currencies using the planning xrate for that quarter. The upshot of all this: It is quite possible that Marketing Directors in the Australian and UK subsidiaries of US multinationals may find themselves with calendar Q4 marketing budgets that are about 20% higher than what they had been expecting just a few weeks ago (their US dollar budgets will go that much further). Budgets set centrally in US dollars earlier this year will go that much further, so despite the troubled economic conditions, the marketing spend by US multinationals might actually increase in countries like the UK and Australia. The only problem: revenue targets are also likely to be 20% higher!
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They Wouldn't Do That... Would They? Taking Control of Your WebsiteAn unfortunate practice we have seen recently is causing small business owners to loose control of their websites: When web designers and other online services companies offer assistance with setting up a new website, be sure that they register the site in your name, not theirs. They should also give you all the account management details (usually just a matter of forwarding one or two emails). You might not understand or need the account management details at the moment, but if you need to change web designer you will be glad you have them! We have been seeing people register sites for their clients in the web-designer's name. You should make sure you have details of:
Almost worse than this, we have seen web developers take advance payment from people they are going to develop a site for but not registering the site until they are ready to load all their code up onto it. The client has the impression that they have registered their website (just because they told the web developer to go and do it), but because the web developer has not done anything, someone else could come along and take ownership of the domain name. The best solution is for small business owners to choose and register their website names themselves. This is quite easy, should not cost more than the cost of a nice bottle of wine, and gives you full control. More on how to register website domain names and control your web-presence.
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