Quantcast had a very interesting recent post on their blog outlining how Apple, despite the amazing success of the iPhone 4, is losing share every month to Google’s Android smartphone operating system.
In fact, the trend is clear. It is just a matter of time until Android overtakes iOS (Apple’s operating system) in usage. If the iPhone 4 can’t hold off the charging masses of the HTC Incredible, Sprint Evo 4G (also by HTC) and the Motorola Droid X is it time to panic in Cupertino? Not quite. Just look at recent history – in fact – look at Apple’s recent history.
Here are two companies, Google and Apple, lead by some very smart people, falling into the same patterns that we saw in the mid ‘90s with the rise of the PC. Not that I need to remind most people, but when PCs went mainstream, Microsoft Windows won the battle. They went with a more open infrastructure, providing a cheap, inter-operable system for any PC manufacturer to adopt. With an aggressive pricing strategy and a developer-friendly focus, they quickly dominated the entire PC operating system market. Today, there are around 1 billion PCs running Microsoft Windows. It was a business success not seen since the time of the Gettys, Carnegies and Morgans. Sound familiar? That is Android’s business plan, only they are giving it away for free so Google can own the app store and keep the search traffic in network.
It is largely forgotten, but Apple was much more prominent than Microsoft when they started their PC ascendency. It was said that Apple could have owned the PC. But they chose not to. And it looks like they are going to make that choice again with smart phones. For all the smoke, an expansion of the iPhone to Verizon has been just that. Smoke. I have no doubt that Apple will expand carrier partnerships someday, but that will never be their focus. Their focus will be crazy tight integration of software and hardware with a best in class approach to smartphones, share be damned – just like they did with PCs. Why? To protect margin. Despite having a massively smaller user base than Microsoft, Apple is making a higher profit than Microsoft these days. And organizationally were ready for the next wave in MP3s and now Phones.
What do I take away from this? There are always multiple ways to “win” for our clients. Sometimes you grab the profits sitting right in front of you. But sometimes you need to look down the path and strategically give up near term “wins” for long term brand health (and profits). At times, business objectives need to look beyond this quarter or even year. Think about what success looks like before you make your first move. Until you do that you will rarely get there.
-- Chris Wexler, VP/director of digital media, smartphone addict, Compass Point Media
Since moving to Minneapolis, I have come to love our independent restaurants that use local ingredients. But last month as I was walking around Portland, Oregon for the first time and looking for something to eat to avoid the dreaded-but-forthcoming focus-group sandwich (do focus-group food caterers also supply food for the nation’s prison system?), some of the best smells I have ever experienced came wafting from a posse of food carts in a parking lot close to the hotel. With them came a lesson on having a brand “experience.”
I asked our cabbie and local foodie Tracy about the Food Carts (yes, cabbie and local foodie – he and his wife even have a website), and he mentioned that the carts are ingrained into Portland’s food culture. While some vendors cannot afford to run a stand-alone restaurant, many others also have traditional restaurants but use carts to reach out new people and offer new experiences. (Tracy also recommended doughnuts at Voodoo, which we wolfed down at 7 am in his cab on the way to the airport. Try the Bacon Maple Bar with a whole piece of cooked bacon on top -- as an ex-pat Canadian I am still very partial to Tim Horton’s, but I digress…)
|In cities like New York, street food culture has become so ingrained in the food scene that they even hold annual food cart awards: the “Vendies.” As chef Mario Batali put it, the awards are “the Oscars of street food for the real New York.” I remember every summer in Toronto making lunch pilgrimages to Little India on Gerrard Street for the roasted Indian sweet corn sold off a cart.
Now that the Minneapolis City Council has recently relaxed some of the municipal food street codes we should hopefully see more food carts here. I was excited to read on the local food blog Heavy Table highlights about some local food-vending carts. I found most interesting, though, that like Portland, at least five of the carts mentioned -- Meritage, 128 Café, The Brothers Deli, Cruzn Café, and Sonny’s Ice Cream -- also have stand-alone restaurants to accompany their new meals on wheels.
So what does this all have to do with an agency blog beyond an excuse to talk about my love for doughnuts and good cheap eats? First, here’s a shout out to these restaurateurs and others who are out there serving up great street food; let’s support them. But secondly, these chefs and cooks know something intuitively about marketing that many CPG clients don’t: how important it is to provide customers with new ways to experience your brand.
As Christopher Stuzman a principal analyst at Forrester Research recently argued on the World Advertising Research Center Site (WARC), winning companies today have moved beyond the tried and true marketing techniques to create genuine product experiences: ‘‘While consumers are tuning out marketing messages, they are actually seeking out more product experiences.’’ While this might sound like heresy to read on an agency blog, I agree with his comment that marketers today are relying too much on communications to build their brands.
Just recently an old brand I used to work on, Pop-Tarts, was all over the news for opening up a store in Times Square. I honestly can’t remember when one of our old Pop-Tarts :30 TV ads got any kind of coverage no matter how high our ASI/Millward Brown test scores might have been. But here it was mentioned from coast-to-coast in the New York Times, Los Angeles Times, CNN, CBS, Howard Stern (guilty pleasure) and many other media outlets. The Pop-Tarts store is now serving customized and unique food offerings (including Pop-Tarts sushi, which is not as scary as it sounds). They have joined M&M’s and Hershey’s in providing new ways to experience the brand.
If you want to go back to the old research-testing methodologies, as wrong as they are, I would bet lunch (at any local food cart) that the day–after-recall among those visiting Pop-Tarts World is higher than that among viewers of any of their TV spots. The recall does not even measure how people talk about and see the brand as more fun, contemporary and creative. But beyond putting all of your money into pop-up stores and less in our own media department, Christopher back at Forrester argues winning brands today are also baking marketing into their product as well. From Method to Dyson’s new bladeless fans, they are building in product experiences at the design level. For more on this subject read Alex Bogusky and John Winser’s book called “Baked In’’ -- the premise is essentially that your product, not your marketing, is your most effective tool. Put another way the message is not the product, the product is the message.
Never mind the obvious and cliché example of pointing out the product experience of Apple products; but have you ever opened a new Apple package? The packaging is designed as well as the product. I left my Apple TV inside the package for about an hour after I opened it, as I did not want to disturb it -- it was like cutting into a beautiful cake.
In regards to building or baking in a product experience, last week while in Toronto and shopping in a men’s store called Got Style, I was given a free Stella Artois beer-experience kit, which highlighted the special nine-step pouring ritual for having a great glass of Stella. (Yes, it is a lot more than just popping off the cap and quaffing.) Apparently Stella gave the kits to the store to give to their best customers – not me, but if you are friendly and nice sometimes you are rewarded. So guess what is chilling in my fridge? The brand with an experience -- in this case, a “pouring ritual.” As good as Stella’s TV ads are, they weren’t what won me over. (An aside: if you are ever in Toronto, pop into Got Style. It’s part men’s store and part spa/lounge with cool chairs for reading or watching sports. In other words, it’s an “experience.”)
To all the local chefs out there on the streets trying to reach new consumers and bring the mountain to Mohammed, all the best. I hope your customer lines are around the block. I especially look forward to lining up at the Smack Shack at 4th St N and 1st Ave for a lobster roll sandwich. To everyone else who’s still using the old 1960’s CPG textbook, time to write a new chapter.
-- Lance Saunders, EVP/Director of Account Planning, planner of good eats
Campbell Mithun CEO Steve Wehrenberg names MRM managing director Rachael Marret as president
MINNEAPOLIS – In a move that accelerates its digitally centric future, Campbell Mithun announced plans to unite with the Minneapolis office of MRM Worldwide, the leading digital agency in the Twin Cities. The deal brings CEO Steve Wehrenberg additional assets for implementing his plan to optimize Campbell Mithun’s digital competence agency-wide and places MRM’s cutting-edge technology capabilities within deeper brand-building expertise.
“We’ve certainly been actively building our digital capabilities, but this combination instantly creates a full-service integrated offering with a deeper, more strategic digital competency than our typical competitors,” said Wehrenberg. “Rachael and her team will be incorporated not as a siloed department but infused throughout the agency.”
The new organization will retain the Campbell Mithun name as well as its Compass Point Media unit. As Campbell Mithun’s new president, Rachael Marret, a 15-year digital veteran, will oversee the integration of digital sensibilities throughout all aspects of the combined agency.
“This is a merger of equals,” said Marret. “With our ability to create technically sophisticated, immersive consumer experiences and Campbell Mithun’s proven brand-building expertise, we’re powerfully equipped to forge the consumer-brand connections of the future.”
MRM executives will play key leadership roles in bringing best-in-class expertise to Campbell Mithun’s existing digital capabilities. Lynn Cerra and Sean O’Brien will join the leadership team as director of integrated operations and director of technology and innovation, respectively.
“This team will bring to the next level our ability to deliver forward-thinking solutions that drive client business,” said Marret. “Marketers now face an entirely new set of engagement needs; we’re placing ourselves ahead of that curve.”
The merger will deepen the combined agency’s ability to provide digital business strategy; user-experience planning; digital connections planning; systems architecture; mobile, game and other application development; agile development; social marketing and platforms; SEM/SEO; one-to-one digital communications; and performance analytics and optimization.
Several factors will ease this transition for the two organizations. Campbell Mithun and MRM are both owned by parent company IPG, and the sister agencies have worked together for 10+ years to serve a number of clients including General Mills, National City, H&R Block and Supervalu.
“The merger is effective immediately, but our existing relationship and proximity gives us more time and flexibility to work out transition details and configure operations,” said Wehrenberg.
“Merging MRM Minneapolis with Campbell Mithun, provides our IPG sister agency with a stronger digital offering, said Reuben Hendell, MRM Worldwide Chief Executive Officer. “Concurrently, MRM Worldwide will both be able to support an integrated offering for the Worldgroup’s Minneapolis-based clients and create more focused growth on its other North American offices in New York, San Francisco, Detroit, Princeton and Toronto, Canada.”
About MRM Worldwide, Minneapolis
MRM Worldwide, Minneapolis was created in 1999 resulting from a merger of two Twin Cities digital shops that grew up during the nascent years of the Web. Over the past decade, MRM has established itself as the leading, full-service digital marketing agency in the Twin Cities and has been part of the MRM Worldwide Network (www.mrmworldwide.com) -- one of the top five digital and direct agencies in the world.
About Campbell Mithun
Began in a post-depression era on the 13th floor of the Northwestern Bank building in Minneapolis, Campbell Mithun thrived due to Ray Mithun’s founding philosophy: make “everything talk” for client brands. The agency has built a national brand-building reputation and, with its Compass Point Media unit and BrandOptix package-design resource, continues to build client marketplace success by making Everything Talk at each (increasingly granular) point of customer contact.
MINNEAPOLIS – Rachael Marret, former managing director of digital agency MRM Worldwide Minneapolis, has become Campbell Mithun’s first female president after the two companies announced a merger earlier today. A fifteen-year digital veteran, Marret will lead the charge to align the combined agency with future consumer-engagement needs.
“I’m happy to welcome Rachael to Campbell Mithun’s management team,” said agency CEO Steve Wehrenberg. “We’ve already had a very collaborative and successful partnership; going forward, we plan for her to focus on bringing our clients new solutions to drive business and build brands.”
Marret brings to the position more than 20 years of both agency and client marketing experience and, since 1995, has focused exclusively on marketing in the digital space.
“In a post-digital world, everything will be digital, social and mobile,” said Marret. “Our future is more than just deepening channel expertise; it’s about new and agile ways to create greater consumer insights, rich experiences, and ideas worth talking about.”
Under her leadership, the MRM Minneapolis office grew to being a top digital agency in the Twin Cities, serving clients such as General Mills, Nestle Purina, H&R Block, and Microsoft. The agency has collaborated with Campbell Mithun on shared clients for the past 10+ years.
Marret herself has performed as a leader, receiving several corporate honors in recent years: She was the 2006 inaugural recipient of the MRM Worldwide “Stimati Award” and also received the H. K. McCann Award for Outstanding Leadership, the highest honor of parent-company McCann Worldgroup.
Before joining MRM Minneapolis, she served on the client side, developing eCommerce platforms and online marketing strategies for Carlson Companies; and also spent nine years playing a creative role for various agencies.
Her strengths directly support the “Everything Talks” branding philosophy articulated by Campbell Mithun’s founder Ray Mithun. The agency has a 77-year national brand-building reputation and, with its Compass Point Media unit and BrandOptix package-design resource, continues to build client marketplace success.
…not directly, but they are recommending an internet regulatory scheme that amounts to that. If you are a marketer and you haven’t read about the ongoing debate about Net Neutrality, it’s time to get acquainted with debate that is going on in D.C. right now. The NY Times has a good primer on the issue as it stands (http://nyti.ms/bITJ52).
The nickel tour of the debate is this: Should internet providers (e.g. Time Warner, Comcast etc.) be allowed to charge content providers (e.g. YouTube, Pandora, etc.) for using bandwidth of their networks in addition to charging consumers (e.g. you and me) to access the internet. Can the backbone networks charge for preferential content while relegating other content to the back of the line? To date, the corporate allegiances in this debate have been predictable – the big cable companies say they can regulate traffic (and charge for access) however they see fit, and the web-based services say no way. In fact, Google has led the charge of the freedom/net neutrality crowd. Until now.
On Monday Google and Verizon announced an agreement essentially cutting up territory like they were FDR and Stalin at Malta after WWII. The internet as we know it will remain free to all content equally (following the guidelines of Net Neutrality) but the mobile web and “new special services” such as internet-delivered TV would not be free and can be regulated by the network “owners.” On the surface this looks like a win for the cable companies since their biggest and most moneyed adversary has essentially waved the white flag on the future. And that is true, but Google has seceded the mobile internet, which many experts expect to be bigger than the current wired internet in terms of traffic by the end of the decade.
In my opinion, Google has flipped Net Neutrality and essentially said that new internet technologies will be controlled by the cable companies and other access providers more than ever before, but has protected the public internet as a fig leaf covering their corporate ambitions.
If this recommendation is accepted by the FCC, the future is a bifurcated world of a public internet that is free, relatively slow, and devoid of major investments in innovation and a series of private networks (like AT&T mobile, AT&T cable, Verizon Mobile, Comcast Cable, etc.) that will preselect which pieces of content flow fast and seamlessly into your life. Those private networks will have higher-income users and bring content that is pre-curated via corporate checkbooks. Do you think NBC might have an easier time getting streams into Comcast households? I’m guessing they will. YouTube might pay the way for the 10% of their content that they can monetize into the private channels and mobile and leave the other User Generated Content to load slowly on the ghetto public network.
“So what?” you say. Guess what, we as advertisers will have to be on those private networks – and all of a sudden our marketing budgets will have another mouth to feed – not just the content creators and distributors, but now the digital backbone that our brand messages have to travel across. The privilege of access to users will have just gotten higher for every CMO. Want to get on the iPhone? Pay your AT&T tax. Want to be on Hulu? Pay your Comcast tax. Slotting fees will move from the grocery store to phones and laptops. And we will have no choice but to pay up. Our marketing budgets easily get 10% less efficient if not more, just to be seen without interruption or at high quality. And don’t think this is just an “internet” thing – TV will be delivered this way and the tax will be there also.
The ambush of Net Neutrality is a blatant grab at the budgets of those of us who fund content that is delivered digitally. And that is all of us who do marketing. Really.
One other thing: this also signals that that Google is no longer as “Googley” in their view of the world. The Paid Search market is no longer growing leaps and bounds in the US and Europe and the fact of the matter is that paid search market simply isn’t as profitable for Google in El Salvador as it is in El Segundo, CA – the US and Western Europe drives their profits. Now that Google’s cash cow isn’t growing like it used to and they have struggled to make money with their other products (just how profitable is Google Docs?), they are turning to other tactics to protect their market position. In the end, Google is maturing as a company and they have done the calculus that it is better for them that eventual competitors have a barrier to entry than the even playing field that Google enjoyed when they started up and competed against Alta Vista. The cash generated by paid search today can protect YouTube, Android, and Google search from innovation not coming from Google in the future. Google gets the fig leaf of “saving” the public internet, but the truth is that net neutrality will reign on what will essentially become a later day AOL dial-up network. And Google is betting that the lack of Net Neutrality can be overcome with their bankroll and this will help ensure that they don’t go the way of AOL circa 1999.
Google has famously stated that part of their mission is “don’t be evil.” Is abandoning Net Neutrality evil? I’m not sure, but it looks like Eric Schmidt and Google’s investors seem to have drawn that line a bit differently than Paul Bucheit and Amit Patel initially intended. Eric Schmidt’s “Evil Scale” (http://bit.ly/cbCc1d) has tipped a bit further to the realm of traditional corporation and further from the rebel outsider position Google has fought for over the years. This is yet another sign that Google has been forced to grow up due to their status as a public company. It is just too bad for us as marketers, because it is our pound of flesh that they need to help protect their profits.
-- Chris Wexler, VP/director of digital media, Compass Point Media