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Tag: marketing

Mr. Tseng Goes to SXSW

Apologies for the lack of blogging these past few weeks. Part of that (although I really have no excuse) is because I got to attend famed tech, music, and film convention South-by-Southwest (aka SXSW).

It was my very first time in Austin, and I had a blast hanging out at the various booths/panels during the day and on Austin’s famous 6th Street in the evening. Granted, I just barely missed the torrential rain of the first half of the conference (and, sadly, also had to miss out on the music and film part of the festivals), but I got to see a fair amount of the tech conference, and had a few observations I thought I’d share

  • A good majority of the companies paying big bucks to market there should spend their money elsewhere. This is not a ding on the conference. Nor am I even arguing that these companies are wasting time sending representatives to the conference. My two cents is that there were many companies there who were spending their money unwisely at best – whether it be on acts of branding heroism (i.e. paying to rebrand local establishments) or holding massive parties with open bars and no coherent message  conveyed to the attendees about who the company is or why they should use the product. I must’ve attended at least three of the latter – and, truth be told, I can’t even remember the names of the startups that held those parties. Bad way to spend marketing dollars, or terrible way?
  • With that said, there were a number of companies there who definitely spent wisely (although whether or not it works is a question I leave for the marketplace). SXSW is a great venue to try to attract the attention of early adopters of consumer internet/mobile products – and it makes great sense to try to blow out marketing there as part of some major product/marketing push. Here’s two companies that I think were smart to spend a lot of money at SXSW (and, in my humble opinion, executed well):
    • nikefuelI think Nike in pushing its digital initiatives like Nike Fuel (which I plan to write a review of :-)) spent quite wisely building its brand. They had an interesting panel on using the product, an outdoors area that looked like a mini-boot camp (no joke!), a digital billboard which alternated between a appropriately color themed and a room decked out like a club where Nike employees sold the fuel band and helped new users get them set up.
    • ncom-lumia-900-cyan-front-267x500-pngI think Nokia (yes, despite my previous post, I mean Nokia) did a great job as well – they set up a Nokia Labs party area which looked like three giant domes from the outside. Right next to the entrance there was a snow machine (I assume to recreate the Finland snow?). The Nokia folks on the inside were all dressed in labcoats (keeping with the “lab” theme) and, like with Nike, there was crazy club music being played. The bar was offering a drink made with Finnish vodka called “Lumia Liquified” (Lumia is the name of Nokia’s new high-end smartphone line). And with this hip backdrop in place, the Nokia party had multiple exhibits featuring the Lumia’s unique design (there was a great display full of the drab black phones we’re used to seeing and the Lumia’s brightly colored phone standing out), the Lumia’s Carl Zeiss lens/optics, and the Lumia’s Clear Black display technology (basically using layers of polarized glass so that the display looks black and readable under direct light). Enough for me to no longer be a Fandroid? Probably not, but I definitely left the party impressed.
  • Like most tech shows, there was a main exhibition floor which I had a chance to walk through. On these floors, companies assemble at booths attempting to attract customers, business partners, investors, and even just curious passerbys. One of the booths I attended was held by Norton, makers of the Symantec security software that might be running on your computer. The reason I point it out is that, through some marketing deal, they were able to capture the heart of this comic loving blogger by co-opting the branding from the coming Avengers movie. The concept was actually pretty creative, if a bit hokey: participants had to play a handful of Norton security-themed casual games (think quizzes and simple Flash games where you use Norton widgets/tools/powerups to defend a machine from attack) to collect a series of badges. At the end of the sequence, depending on how you did on the games, you are awarded a rank and given a prize. One very fun perk for me is the photo below – guess who’s now a superhero? 🙂

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    That picture alone made SXSW worth it :-).

(Image credit – Nike fuel band – Linkbuildr)(Image credit – Lumia – Nokia)

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The Marketing Glory of NVIDIA’s Codenames

This is an old tidbit, but nevertheless a good one that has (somehow) never made it to my blog. I’ve mentioned before the private equity consulting world’s penchant for silly project names, but while code names are not rare in the corporate world, more often than not, the names tend to be unimaginative. NVIDIA’s code names, however, are pure marketing glory.

Take NVIDIA’s high performance computing product roadmap (below) – these are products that use the graphics processing capabilities of NVIDIA’s high-end GPUs and turn them into smaller, cheaper, and more power-efficient supercomputing engines which scientists and researchers can use to crunch numbers (check out entries from the Bench Press blog for an idea of what researchers have been able to do with them). How does NVIDIA describe its future roadmap? It uses the names of famous scientists to describe its technology roadmap: Tesla (the great American electrical engineer who helped bring us AC power), Fermi (“the father of the Atomic Bomb”), Kepler (one of the first astronomers to apply physics to astronomy), and Maxwell (the physicist who helped show that electrical, magnetic, and optical phenomena were all linked).

cudagpuroadmap

Who wouldn’t want to do some “high power” research (pun intended) with Maxwell? 🙂

But, what really takes the cake for me are the codenames NVIDIA uses for its smartphone/tablet chips: its Tegra line of products. Instead of scientists, he uses, well, comic book characters (now you know why I love them, right?) :-). For release at the end of this year? Kal-El, or for the uninitiated, that’s the alien name for Superman. After that? Wayne, as in the alter ego for Batman. Then, Logan, as in the name for the X-men Wolverine. And then Stark, as in the alter ego for Iron Man.

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Everybody wants a little Iron Man in their tablet :-).

And, now I know what I’ll name my future secret projects!

(Image credit – CUDA GPU Roadmap) (Image credit – Tegra Roadmap)

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Heads and tails

I just read a really interesting Economist article which, at first, I thought was very counter-intuitive.

image In the early days of television, there was very little in the way of network selection for the average TV-viewer. There were only a handful of stations and, regardless of how bad the content on a given station was, those stations would stay in business because they were the only stations around. Heck, even if the station’s programming was completely awful, there would still be plenty of people watching it simply because it was one of the only things that was on.

Flash forward a few decades. We now not only have many television stations, not to mention cable, satellite, and internet video. We have enough DVDs to last a lifetime. The web has made it so that anyone with a camera and an internet connection can broadcast to YouTube.

Given all this, what would you expect to happen to what people watch? If you’re anything like me, you would’ve concluded that the power of the internet to connect people with what they want and the abundance of new video content would have encouraged people to “spread out.” Why would you stick to a few “staple” networks, when you can now watch the SyFy channel for science fiction, CNN for the news, and YouTube if you want to keep LonelyGirl company?

imageWell, writer Chris Anderson seemed to agree and he popularized this idea in a book (and “theory”) he called The Long Tail (book cover to the right). In it he describes exactly what I just laid out, that because technology makes it easier for people to find the things which the majority of consumers aren’t interested in, the future of business would be less about selling a few popular items that “sort of” appeal to the “average person” and much more about selling a lot of the “the long tail” (pictured graphically below) of things which really appealed to a few people apiece. Or, to use the TV analogy again, the idea behind the Long Tail is that it makes more sense to create a bunch of small TV stations which focus only on a few niches than it is to have one big station that tries to satisfy everyone at once. This is, after all, one of the big ideas behind eCommerce sites like eBay. Wal-mart or Target can and will stock lamps which sells several millions of units, but because they can’t possibly stock every lamp, they won’t satisfy everyone. The Long Tail theory says that the real money to be made is in selling the millions of things which are only going to sell a few items apiece, but because those items are exactly what those people want, you can probably make a little extra profit off of each.

After all, how many authors or singers have you absolutely loved, but knew they could never go “mainstream”?

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As appealing as that idea was (especially to the snobs out there, myself included, who just wanted to assure themselves that the real money wasn’t in going mainstream but in going for the nobody’s-ever-heard-of-them CD/book/electronic/movie), reality has not played out quite that way.

While there is no doubt that the internet has expanded choice such that people now have access to the long tail, instead of seeing a diminishing “head”, the size of the biggest hits has increased dramatically. Take books as an example. From the Economist:

A study of the Australian market by Nielsen, a research firm, found that the number of titles bought each year (measured by ISBNs) has risen dramatically, from about 275,000 in 2004 to almost 450,000 in 2007. Niche titles selling fewer than 1,000 copies each accounted for nearly all the growth in variety. Yet their market share fell. In Britain, sales of the ten bestselling books increased from 3.4m to 6m between 1998 and 2008.

So, instead of seeing a migration from the “head” to the Long Tail, we’re seeing Goldilocks’s middle-of-the-road players getting crushed by blockbuster hits on the one side and the long tail on the other. This begs the question: why are hits doing so well when there’s so much else out there? Again, the Economist:

A lot of the people who read a bestselling novel, for example, do not read much other fiction. By contrast, the audience for an obscure novel is largely composed of people who read a lot. That means the least popular books are judged by people who have the highest standards, while the most popular are judged by people who literally do not know any better. An American who read just one book this year was disproportionately likely to have read “The Lost Symbol”, by Dan Brown. He almost certainly liked it.

Ironically, it turns out the technology which makes the long tail more accessible is even better at turning hits into even bigger hits. After all, the internet helps spreads word-of-mouth for hits and long tail products alike. If anything, the fact that technology today makes it so easy to choose between different things is going to drive people to look for hits if only so they have something to talk about with one another.

Unfortunately for content and product people, this makes business very tricky. It means you can take one of two routes to success: make a blockbuster hit or sell a lot of niche products which appeal a great deal to a few people each. The former is tough to do because its hard to know what will be a hit. The latter is tough to do because you’ll need to have a very lean cost structure to be able to profitably make a lot of products which are only selling a few units a piece. But, the worst part is that trying to split the difference between both is especially hard as the former requires a big budget for marketing and for getting the best writers/artists/coders and the latter falls apart because you need to make many different things.

How things will ultimately shape out is anyone’s guess, but my perspective is that the smart companies out there will do three things:

  1. Invest in strong PR and marketing muscle. If people seek hits because they want to be able to talk about things with each other, then the job of the product/content company is not just to make the best product possible, but its also to get people to talk about it. This means the smart companies will invest heavily in either a strong internal public relations/marketing group or a partnership with someone particularly strong in that area. This will be especially critical for the largest product companies/studios as having a strong PR/marketing capability will be an asset they can leverage across all their products, both those that need to be hits and those going for the long tail.
  2. Find ways to cross-sell. The economics of a long tail business are grim, because they involve keeping and developing a wide range of products that are each only going to sell a few items. How do you do well with that type of strategy? The answer is that you do everything possible to turn flops and long tails into hits. One approach is to take a page out of Amazon.com’s playbook: recommendations. Amazon has found a way to encourage buyers to not just buy one thing, but to buy several by using a sophisticated computer algorithm to find products which people tend to buy together. This lets a company use one product to many others: free marketing, in a sense.
  3. Be a lean, mean product-making machine. The only way to survive hits turning into flops is to make sure the hits don’t cost too much to make. The only way to make the long tail profitable is to make sure you have a lean operation in place which quickly and cheaply cranks out high quality ideas. Take some of the large social gaming companies like Zynga, maker of the very popular Facebook game Farmville. Don’t tell me that Fishville, Petville, Yoville, and Cafe World are completely original ideas :-). This is not to bash on Zynga, as I think the idea is brilliant and the quality of the games lies in the execution not necessarily in the originality of the concept, but in a world of hits and long tails, the best strategy is to find some core engine which you can re-hash and improve upon again and again. And few can question Zynga’s winning formula in that arena.

(Image credit – TV) (Image credit – Long Tail book) (Image credit – Long tail diagram)

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