November 21, 2014
November 21, 2014
A children’s game has morphed into a drinking game among German Millennials, reports Jack Nicas in The Wall Street Journal (11/13/14). Hasbro’s Looping Louie, "a four-player tabletop game with a motorized plane that circles around the board, knocking off players’ tokens," never took off in the United States. However, it "has become a cult phenomenon in Germany, inspiring Internet memes, making a cameo in a German music video and becoming a mainstay in university dorms and shared apartments nationwide."
In the German tradition, when players lose a round, they drink a shot. "It caught on as the perfect drinking game," says Michael Kohner of Longshore Ltd., which makes the game out of Hong Kong. Since 2006, some 1.3 million copies of Looping Louie have sold in Germany. It "is the No. 2 best-selling game on Amazon’s German website, holding a spot in the top 100 for more than seven years. While its page depicts smiling children, most of its nearly 1,000 reviews extol its ability to get players drunk."
The game has also spawned a cottage industry of modified games including supercharged motors, "flashing lights or little holes to hold shot glasses … Dozens of Internet videos showcase more extreme homemade versions, with glow-in-the-dark parts, touch-screen remotes, roulette wheels to decide what the loser drinks and smartphone apps that control Louie." The game has now arrived on at least one American campus, courtesy of a German exchange student, and Hasbro is planning to relaunch it in the US in 2015 or 2016.
November 20, 2014
Cereal-flavored milk is attracting an unintended audience, reports John Grossmann in The New York Times (11/13/14). Christopher Pouy came up with the idea for Cow Wow Cereal Milk while recalling "his childhood breakfast table, where the best part of his morning cereal came when he put down his spoon, lifted the bowl to his lips and gulped the remaining milk infused with the flavor of Froot Loops or Cocoa Puffs." As founder of a firm called Chicken Pox, Christopher was in the business of creating viral ideas, and saw this as a natural.
Imagining that his audience would be kids — or, more specifically, their moms — he created a product using "one percent organic milk, no artificial flavors or colors and organic cocoa powder and cinnamon." Packaged in 8.5-ounce Tetra Paks, each serving packs 150 calories. The viral effect kicked in with plugs from Jimmy Kimmel, Cosmopolitan magazine and BuzzFeed. It was great exposure, but with one obvious problem — the audience was all wrong. The buzz happened among millennials, not young moms, as planned.
Meanwhile, Cow Wow is getting good distribution at Legoland, the Los Angeles Zoo and Kroger supermarkets. The problem there is that it is priced "about 20 cents higher than flavored milks in Tetra Paks offered by Organic Valley and Horizon Organic." Sales are not meeting expectations. Christopher hasn’t yet decided on a course of action — either double down on moms or re-design for millennials "with hipper cows and a larger package." Or, create a hybrid strategy and try to appeal to both audiences.
November 20, 2014
American copyright laws have been around since 1790, but no longer apply in the Internet age, argues Cory Doctorow in Information Doesn’t Want to Be Free, reviewed by Edward Kosner in The Wall Street Journal (11/19/14). "We can’t stop copying on the Internet because the Internet is a copying machine," Cory writes. Where copyrights, "as conceived in England three centuries ago to protect writers from unscrupulous printers," today they mainly protect "the entertainment industrial complex" from everyone else.
This goes to the heart of the problem, which Cory "asserts is a purposeful misconception about how the Internet is used. The vast majority of people use the Web for ‘personal, cultural, private activity’," and yet "average folk must consume content — especially entertainment content — under a system designed to thwart thievery on an industrial scale." As Cory puts it: "Industrial regulations should apply to industries, not individuals." He further argues that blocking "unauthorized use" is tantamount to censorship.
Cory’s solution is "to seize the means of information and insure that technology’s benefits are distributed to everyone, not just the powerful." He apparently is less clear about how to accomplish this. However, he does advise "novelists, journalists and other artists" to "welcome having their words, music or images reproduced online without permission, to pave the way for a later payoff." This may make the creators vulnerable to being ripped off, but at least they have a shot at making money based on having made a name for themselves.
November 19, 2014
Everybody rushed to establish online profiles, but now scramble to erase them, reports Ben Johnson in The New York Times (11/19/14). "Three years ago, 75 percent of our revenue was public profile stuff and maybe 25 percent was helping to take it down," says Jeffrey Tinsley of MyLife. "Now it’s the exact opposite." Jeffrey’s original business was intended to connect old classmates, but Facebook came to dominate that realm. He flipped his "script on privacy" after being criticized for using customer address books to recruit new customers.
MyLife competes with other privacy-protection services, such as Abine’s DeleteMe, Reputation and "new social apps like Secret, Whisper and Canary. A growing number of websites also offer services that claim to help protect, maintain or even erase what is fast becoming your most permanent and accessible record: data that can be gleaned about you from search engine results." The notion that young people don’t care about privacy is outdated, according Rob Shavell, CEO of Abine, noting a user shift from Facebook to Snapchat as evidence.
Snapchat "allows users to send messages that disappear after delivery." Erasing profile information from the Web is another matter, however, especially in the US, in no small part because of The First Amendment, notes Christopher T. Bavitz of Harvard Law School. Philip R. Zimmermann of Silent Circle, maker of the Blackphone, meanwhile says money can’t buy you privacy because having money likely means you are on the Internet. "It gets into the soil," he says, and "once it’s out, it’s pretty hard to get it cleaned up."
November 19, 2014
Kentucky’s distilleries could teach the oil industry an important lesson, reports Neil Irwin in The New York Times (11/18/14). The two businesses are signficantly similar: Both products require long lead times and neither can predict future demand. With oil, it’s that it takes years of constructing drilling project "before the crude begins to flow." With bourbon it’s "because a distiller must keep the good stuff in barrels for seven, 10 or even 20 years before it’s ready to drink." This leads to the "boom-and-bust" cycles that afflict both industries.
The reason oil prices are dropping today is that high demand in the last decade triggered investments in exploration that are now creating excess supply. The opposite is happening with bourbon, which has become "the buzzy distilled spirit" over the past ten years, but distillers had no way of foreseeing this. "In 2002, we would have been making Buffalo Trace to be sold in 2011," says Mark Brown, CEO of Buffalo Trace Distillery. "There was absolutely no indication that demand would have reached the levels it reached."
The difference is in how the two industries respond. The oil industry simply adjusts its prices, as Economics 101 would suggest. Unfortunately, doing so raises consumer incentives to "invest in efficiency and alternative energy sources," which works against the oil industry’s interests, long-term. Bourbon makers, meanwhile, hold prices steady regardless of supply and demand. It’s a bet "that there is more money to be made in the long run by cultivating a new generation of bourbon drinkers," while also "building loyalty among customers."
November 19, 2014
Germs are "at the heart of 85% of all" snowflakes, reports Michael Benson in a New York Times review of Zoom by Bob (Skyman Bob) Berman (11/18/14). It seems that "water molecules need specks of airborne detritus to coalesce around to form flakes" and "that droplets or airborne moisture freeze most readily not around dust or smoke, but rather microbes." Yuck. This is but one of the many "unexpected insights and arresting observations" Bob makes in Zoom, which examines a range of "complex kinetic concepts."
The book "examines speeds of all kinds, from the spooky stasis of absolute zero (or 459.67 degrees below zero Fahrenheit, where even atoms stall … and onto superfast, light speed and even beyond." It explores "the inner workings of lightning and auroras; and even sap’s variable speed as it rises from root to branch." Here’s another one for you: Most of those who died in Pompeii in 79 AD were not victims of slow-moving lava; they died from inhaling high-speed superheated gases mixed with dust that boiled their brains until they exploded in their skulls.
If you’re feeling the earth move under your feet at the Equator, it’s "at a supersonic 1,038 mph … a rotational speed that declines incrementally to zero as one ascends or descends to the poles." The speed of sound — 761 mph — happens in, of all places, Woodstock, New York, "that laid-back hippie place." As to the age old question of whether trees that fall in the woods with no one around make any sound — they do not. This is based on Galileo’s observation that absent an eardrum to receive the "vibrations that spread through the air … no sound can have been produced." It’s all in the mind, you know?
November 18, 2014
The foundation of loyalty is in the moments of important brand experiences. A book excerpt from Daryl Travis of Brandtrust. Every brand has its moments. Some are bad. Some are good. A few moments, though, matter much more than others. The ones that matter most make customers feel something personal — confidence, validation, connection, reassurance, or any other positive emotion. Those are the moments that create brand loyalty.
We like to believe our behavior is completely rational. We cling to the idea that logic and reason guide us. If this were true, we would never consume anything unhealthy and no one would ever be overweight. Everyone would diligently save money and have enough put away for rainy days and a worry-free retirement. We would exercise regularly, refuse to buy higher-priced products that don’t provide value, and always make the right choices. (You’ve got all those covered, right? Yeah … me too.) Read The Rest of the Book Excerpt.
November 18, 2014
"The closure of the failure loop has sent uncomfortable ripples throughout the economy," writes Adam Davidson in The New York Times (11/15/14). "The lifespan of an innovation" today "is best measured in years, and, for some products, even less." With this comes a similarly "breakneck pace" of failure, that can be "measured in unemployment checks, in divorces … and in promising careers turned stagnant … Right now we’re going through changes that rip away the core logic of our economy."
At the center is "the single greatest risk-mitigating institution ever: the corporation," which acts "as a giant risk-sharing machine, amassing millions of investors’ capital and spreading it among a large number of projects, then sharing the returns broadly, too. The corporation managed the risk so well, in fact, that it created an innovation known as the steady job … The secret of the corporation’s success, however, was that it generally did not focus on transformative innovations," but rather "perfecting the manufacturing of the same products."
However, the failure loop continues to close with the rise of global competition. Meanwhile, the advent of computers and the Internet, as "loose groupings of individuals," operating through computer networks today perform "functions that were once the domain of larger corporations." MIT’s Daron Acemoglu thinks we will need new institutions to adjust to such disruptions, but it won’t be clear what those should look like "until we know the precise problem we’re solving." "I don’t think we are quite there yet," he says.
November 17, 2014
As apps continue to rise in popularity, the web "is dying," reports Christopher Mims in The Wall Street Journal (11/17/14). "We’re in love with apps," Christopher writes. "On phones, 86 percent of our time is spent in apps, and just 14 percent on the web, according to mobile analytics company Flurry." Part of the issue is that apps are "controlled by central gatekeepers" who represent "the end of the very openness that allowed Internet companies to grow into some of the most powerful companies of the 21st century."
"App stores … are walled gardens where Apple, Google, Microsoft and Amazon get to set the rules. Apple regularly bans apps that offend its politics, taste or compete with its own software or services." It also "takes 30 percent of every transaction conducted within an app sold through its app store." Where the web encouraged sharing, and enabled anyone to "put up a web page or launch a new service," app stores are designed to "shut out rivals." Where the web wasn’t designed to "include any way to pay for things," that is the app store’s very purpose.
The issue is that "as apps take over, the web’s architects are abandoning it … The process of creating new web standards has slowed to a crawl. Meanwhile, companies with app stores are devoted to making those stores better than — and entirely incompatible with — app stores built by competitors … It isn’t that today’s kings of the app world want to quash innovation, per se," writes Christopher. "It is that in the transition to a world in which services are delivered through apps … makes innovation, serendipity and experimentation … that much harder."
November 17, 2014
eBay is applying insights into online shopping behavior to bricks stores, reports Elizabeth Holmes in The Wall Street Journal (11/12/14). The operative e-commerce concept is "the funnel formula, where lots of shoppers enter at the top and narrow in number to the few who purchase something." Healey Cypher, eBay’s head of retail innovation, explains: "There are critical moments where they are going to buy something, or they are going to leave … We’re applying that exact same logic to the physical world."
For Rebecca Minkoff, a designer opening stores in New York and San Francisco, the fitting room is one such moment. "Being half naked and having to hope that someone sees you when you pop your head out, that’s never been a fun experience," she says. Working with eBay, Rebecca is equipping fitting rooms with an antenna-embedded lightbulb that "reads RFID tags in merchandise brought to the room, and images automatically appear on the mirror, which doubles as a touch screen" that suggests complementary items.
The shopper can also complete a transaction via eBay’s PayPal, right in the fitting room, as well as "enter a phone number and get a link to things they tried on, so they can buy later online." This wired fitting room also "tells the store not only what shoppers bought, but also what they left behind," enabling the store to track inventory levels. "It’s about capturing data you usually lose," says Healey. Rebecca’s stores also feature a touchscreen "connected wall" where shoppers "can select items to try on" and "get a text alert when a fitting room is ready."
November 17, 2014
A new "generation of web services" is bringing e-commerce finesse to mom-and-pop stores, reports Jenna Wortham in The New York Times (11/16/14). These services, with names like Shopify, Storenvy and Big Cartel are capitalizing on the "small, do-it-yourself businesses that have flourished online as social media platforms have exploded in popularity. While web shoppers may rely on behemoths like Amazon or FreshDirect for household staples and groceries," they might also prefer to buy specialty items from "someone who made it."
While "online marketplaces like eBay and Etsy have helped entrepreneurial, work-from-home types sell their goods online for years," these new services help "create the appearance of independent, professional, polished retail establishments, even if they are sometimes just a single person operating a web shop out of a bedroom." Services typically start at "around $10 a month," and sometimes also collect a percentage of sales. The retailers simply pick a name and design, upload images of their wares and are ready for business.
Jordan Roschwalb uses Shopify to launch his online store, Pintrill. "I wanted to be taken seriously as a brand from the beginning," he says. "And if we want to be in Barneys one day, it’s not going to happen because we’re on Instagram or Etsy." Others have found that while these ready-made storefronts can provide a great launching pad, they have limits as the business grows, and can’t necessarily handle relatively large sales volumes. That’s okay with Dan Christofferson of Big Cartel, who sees losing such customers as "a bittersweet day, like when the kids go off to college." Except in this case, it’s mom and pop leaving the nest.
November 14, 2014
Brands can create real-time relevance at life’s most intimate moments. A Hub White Paper by Tyler Murray of TracyLocke. One of the chief buzz-worthy concepts currently rising in popularity is real-time marketing. This marketing invention is broad in scope, involving everything from customer service to direct marketing and even brand building.
The concept of real-time is a perfect fit for customer service and direct marketing, as these two disciplines require timeliness to be successful. However, brand marketing hasn’t quite hit its stride as it relates to using real-time effectively. To explore a new approach to real-time brand building, we first need to understand its purpose, the lessons that direct marketing and customer service applications have yielded, and how brands might best apply those lessons. Read The Rest of The White Paper.
November 14, 2014
The man who transformed Trader Joe’s into a "billion-dollar enterprise" has died, reports Paul Vitello in The New York Times (11/13/14). John V. Shields, 82, was not Trader Joe’s founder, and before he took its helm as CEO had no experience in the grocery business. He was a department-store executive who was hired by founder Joseph H. Coulombe. The two had been Stanford University fraternity brothers. During his tenure, Mr. Shields expanded Trader Joe’s from 27 stores to 138, and its sales from $132 million to $2 billion.
He kept the retailer’s quirks — the Hawaiian shirts worn by its staff, and the "exotic low-cost offerings," while also establishing a "management system that made the company’s retail culture exportable. He standardized the layout of stores, started a management training program and brought market analysts into the decision-making process, innovations that made Trader Joe’s one of the nation’s most profitable grocery chains." He carefully located new stores in college towns and "gentrifying communities."
Mr. Shields "personally interviewed store manager candidates … Applicants who did not smile in the first 30 seconds, he once said, were crossed off the list." He said that people were either right for the "crew" or not. "I would talk with the new people for about two hours," he told an interviewer. "and I always ended up saying, ‘Look, at the end of 30 days, if you are not having fun, please quit." Joseph Coulombe said his friend’s lack of grocery background was irrelevant, explaining: "We’re closer to the fashion business than the supermarket business."
November 13, 2014
A young artist and curator is running a gallery from her father’s button shop, reports Marina Garcia-Vasquez in The Wall Street Journal (11/10/14). When Amy Li finished art school, she couldn’t find a job "at a museum or art organization." So, she persuaded her father, owner of the He Zhen Snap Button Company in Chinatown, New York, to let her open a gallery in his shop. "There are so many assumptions attached to the word ‘gallery,’" says Amy. "This is just a space where I could work as a curator and art dealer."
She called her first show, in 2013, "Without Consent," a reference to her renegade status. Since then, she "has produced 10 art shows that have received accolades in the art world." Amy has managed to attract artists who "respect her professionalism, quiet temperament and dedication to community building." They also like "the button-shop concept: that an industrial workshop could house art, and that an aspiring gallerist works side-by-side with her father." The shop’s location "in a heavily trafficked neighborhood" is another draw.
Featured artists get into the spirit of the thing, with photographer Donna Ferrato using "grommet rings from the button shop to hang her photos on the gallery walls," for example. Amy’s success is that much more remarkable considering that "it’s almost not possible to open a gallery" in New York these days, notes artist Alfredo Martinez. Amy is now considering starting "her own museum in the neighborhood, turning an underused" building "as an art space where local schools can take students to learn about contemporary art."
November 13, 2014
A Chinese company is producing the "Model T" of drones, report Jack Nicas and Colum Murphy in The Wall Street Journal (11/11/14). "Back in the day, you could talk about cars, but pretty much every car on the road was one of the Model Ts," says Matt Waite of University of Nebraska, drawing the parallel. The ‘Model T’ of camera-equipped drones, popularly known as the Phantom, is made by Shenzhen-based SZ DJI Technology, which is "selling thousands of its 2.8-pound, square-foot devices for about $1,000 each."
This not only makes DJI "the world’s biggest drone maker by revenue," but also "the first Chinese brand to pioneer a major new global consumer product category." The Phantoms are attracting all kinds of interest, having "garnered fans for their aerial footage of extreme sports, fireworks and Niagara Falls, and famous users," including Steve Wozniak, Jamie Foxx and Martha Stewart. They are being used "in filmmaking, farming and construction — all in defiance of the FAA’s effective moratorium on commercial drones."
Founded in a university dorm room in 2006 by Frank Wang, DJI had "90 employees and $4.2 million in revenue in 2011." It now has 2,800 employees, three factories, and this year expects to post sales three to five times greater than in 2013, when it posted $130 million in revenue. This has led to growing pains, including lawsuits and customer-service issues. "Their innovation rose them to the top very quickly,’ says Stephen Burtt, CEO of Aerial Technology, a drone retailer. "But then it was: ‘Oh wait, how do we clean up the trail we just blazed?’"
November 12, 2014
A boyhood fascination with blimps and dirigibles is propelling a newfangled airship, reports Billy Witz in The New York Times (11/11/14). Igor Pasternak, 50, grew up in Lviv, Ukraine and "believes he is on the verge of developing an aircraft that will change the way large cargo can be shipped." He calls his innovation the Aeroscraft, and envisions a "770-foot long, silver-skinned airship, which is kept aloft by helium-filled tanks, delivering fresh fruit to Alaska, dropping triage units at disaster sites or depositing heavy machinery into remote locations."
The Aeroscraft "will take off and land like a helicopter," controlling descent via a system that replaces (non-flammable) helium with oxygen, which is heavier. The craft would have twice the capacity of a C-5 cargo plane, and a range of about 5,870 miles. Igor believes the Aeroscraft will be ready in about four years’ time and predicts it will "transform the distribution of goods the way the Internet has transformed communication." Chris Caplice of MIT isn’t so sure. "It has uses, but they are narrow," he says.
Chris suspects the Aeroscraft may go through the Gartner hype curve, "in which a period of inflated expectation is followed by the trough of disillusionment, which eventually gives way to a middle ground as a product finds its niche." The comparison is to RFID, which has "not quite revolutionized how people keep track of things." Igor is pressing on, however. Much of the development cost has "been covered by government military contracts," but Igor says he plans to derive future financing from sales.
November 12, 2014
Little old trailers from the 1950s and ’60s are enjoying a comeback, reports Steven Kurutz in The New York Times (11/6/14). Kelle Arvay loves her 13-foot 1955 Bellwood travel trailer, with "its rounded aluminum shell exemplifying all that is sleek and sturdy about mid-century design." She keeps it, under a carport, in her yard. "Sleeping in one of these is just great," she says. "Especially at night, if it starts raining. It’s a great sound, the rain on the roof." She owns a 1968 Shasta Compact, measuring just 10 feet long, as well.
Kelle also buys, restores and sells old trailers, and chronicles her passion on a blog, littlevintagetrailer. She’s not the only one making money. J. Wes Yoder bought and fixed up "a ’63 Shasta on eBay for $1,900." Parked in his backyard, he rents it on Airbnb and says it was occupied almost every day for the past year. "A lot of people who stay here talk about how simple it is," he says. Old trailers "are being repurposed in all kinds of ways: as a roadside bakery stand, as vacation homes … as backyard writing or painting studios."
Some see the trailers as a time capsule, and want only original parts. Others, like Mandi Gubler, relish the chance to "transform an old shell," remaking a 1972 Bell trailer, painting the stove white and cantaloupe and installing a pine floor. Marsha Heckman bought and re-decorated a 29-foot Airstream instead of adding onto her home. Given such "renewed popularity, Shasta reissued its 1961 Airflyte," known for its "canned-ham shape," with updated appliances and a bathroom, but otherwise "preserved the classic styling."
November 12, 2014
Previously overlooked for their ubiquity, vintage travel posters are now prized as art, reports Greg Beato in The New York Times (10/26/14). An Australian poster from 1935 recently sold for $1,250 and a 1931 poster "that portrays the bow of an ocean liner in a highly stylized Art Deco manner, brought $50,880." Such posters typically were "printed on cheap paper," but "their glamour" has endured. "These posters were telling you how you should live your life," says Nicholas D. Lowry, an auctioneer.
The Australian poster, "’To the Seaside by Train‘ … doesn’t depict a seaside or a train. Nor does it feature any element that suggests ‘Australia’ in any way … Instead, the poster is built around an illustration of a man and a woman in white, form-flaunting bathing suits … Their toned limbs and radiant smiles are so vital and incandescent they overwhelm the rest of the universe … Travel, the poster suggests, isn’t about going to some physical place. It’s about achieving an emotional state." The poster also advises: "Take a Kodak."
That particular Kodak moment was part of a cooperative advertising agreement, however most people in ’30s-era travel posters looked "more than ready for a selfie." Recognizing the modern-day allure of vintage travel posters, Ritz-Carlton recently "updated its smartphone app with a feature that lets users create their own vintage-style posters by applying the destination titles, stamps and other effects to the snapshots they take on their trips." A much older technology — railways in 1880s France — is credited with the rise of travel posters. They connected the world, says Nicholas, "like the Internet."
November 11, 2014
Why shoppers do what they do at the store. A Hub book excerpt by Dan Flint of University of Tennessee and Chris Hoyt & Nancy Swift of Hoyt & Company. In-store shopping behavior may be motivated by mood, the joy of a bargain, the pleasure of the in-store experience, or impulse. An initial purchase can provide a psychological impulse for shopping momentum that prompts purchases of unrelated items. Impulse shopping, the sudden and powerful urge to buy immediately, has gained a lot of attention in practice, as well.
Some drivers of impulse buying seem to be promotions, momentum, and the presence of others. Practitioners have even begun to draw on neurology and behavioral economics to build on these scholastic bases. Music, lighting, and the overall excitement projected in a store impact the amount of time shoppers spend in a store, as well as their emotional connection to a store. Shoppers also take cues from a store’s social environment, the overall ambiance of the store, and from the moods and credibility of retailer salespeople. Read The Rest of The Book Excerpt.
Podcasts are rising as an intimate medium of advertising, reports Steven Perlberg in The Wall Street Journal (11/7/14). It seems some "15 percent of Americans have listened to a podcast in the past month, up from nine percent in 2008," and even though the medium doesn’t have "the kind of big reach that, say, TV, can offer … listeners are attentive while they are listening to their favorite podcast shows. And a voice of authority can rub off on the ads, which are usually in the form of a plug directly from the host."
"With podcasts, what you may not be getting in raw numbers — scale — you’re going to make up for at least partially in how engaged the audience is," says Paul Verna of eMarketer. "It’s not like banner ads where you’re just putting them out there and hoping that 0.03 percent of your audience is going to click it." That kind of connection is not "exactly cheap," though. An ad on Serial, one of the most popular podcasts, costs $25 to $40 per thousand listeners. Serial centers on a real-life murder mystery and attracts a million people per episode.
Podcasts have come a long way since "the iPod burst onto the scene in the early 2000s." At the time, they didn’t really catch on as an advertising medium given "the rise of newer channels like Web video." However, these days, "thanks to smartphones and wif-fi," podcasts are "less like downloadable music and more like Internet radio — an increasingly attractive platform for advertisers." The appeal to listeners, says Yale Cohen of ZenithOptimedia, is that podcasts can now be streamed, and the experience is much more like Internet radio.