Fizz from ConsumerPop

G.E. and Comcast Strike a Deal for NBC: What It Could Mean for the Future of TV and the Internet

The General Electric Company has agreed to sell a controlling stake in NBC Universal to cable giant Comcast. Comcast will own 51% of a new joint venture with G.E. retaining 49%.

While rumors of the pending deal have been swirling for months, the new venture still faces a regulatory confirmation process that deal watchers estimate will take anywhere from 9 to 18 months to complete.

Although what new media landscape might emerge from this deal is, at this time, speculative, Comcast has created a microsite about the acquisition and Chairman and CEO, Brian L. Roberts, is blogging about the announcement.

The desire to own a media content creation company is not new for Comcast. In 2004 Comcast attempted a hostile takeover of Disney that ultimately failed.

Comcast's interest in this area is not difficult to discern. Television and media watchers like myself have long seen some writing on the wall: winners in the new world will be the ones that can deliver any and all content to viewers on the device and at the time of their choosing.

Several solutions have been developing but none have been completely satisfactory. Comcast has developed its "On-Demand" service, Netflix has partnered with device makers in order to stream content directly to televisions, Apple makes its Apple TV box and using iTunes you can purchase television shows to download to your iPod, DVRs like TiVo allow time shifting of recorded shows, sites like Hulu and Clicker aggregate television content to facilitate one-stop online viewing of free over-the-air and cable television without the subscription or the television set, and television manufacturers are working on developing internet enabled televisions that will cut out the service provider and device middlemen.

However content creators still hold some important cards in this poker game for the future. Mailing physical DVDs is not the future and no company is more aware of this than Netflix (Full disclosure: I am a former employee of Netflix). That's why they've been developing their on-demand streaming services and what allows them to lead in this arena is the existing relationships they have with studios, from their original DVD-rentals-by-mail business, with whom they must negotiate to get the rights to stream their content.

Each new change in technology requires a new round of standards, permissions and deals to be made. As both the content creator (Universal Studios, NBC Television and the plethora of cable channels NBC and Comcast each own) and deliverer (Comcast's cable and internet services) Comcast positions itself to better take advantage of an ability to provide whatever consumers want, wherever they gravitate as broadcast TV, DVD and other media models rapidly decline. If they could manage to acquire a mobile phone service provider and device manufacturer, Comcast could completely dominate where I think we are headed: i.e., everything must be accessible via a handheld device like a cell phone. And in negotiation with themselves they can not only better control the process but profit from it as well.

BlogHer co-founder and CEO, Lisa Stone, sees the potential for an exciting future with the new Comcast:

Full disclosure: GE/NBCU are investors in BlogHer through the Peacock Equity Fund. But that doesn't change my opinion that, from the outside, the synergy of media assets between NBCU and Comcast is pretty exciting. The joint venture will be a video powerhouse immediately, but it seems to me that the sleeper opportunity is digital. Just imagine what one could accomplish for women online with the multimedia and .com assets of E! and DailyCandy to iVillage, BravoTV, and Oxygen, not to mention MSNBC and CNBC.com.

No crystal ball is without some clouds in the picture, however. The merger of AOL and Time Warner in an effort to dominate the future media world provides an important cautionary tale. Nevertheless it seems to make smart business sense for both Comcast and G.E.. The potential for monopoly power, however, frightens a number of observers, especially supporters of net neutrality principles who are particularly concerned given Comcast's previous troubles with the FCC over their perceived attempts to throttle the internet and to limit and control and, some believe, ultimately tier access.

As a keen observer of television (content and hardware) and opiner on its digital future (delivery, consumption and business models), I will be watching this deal and how the changes it ultimately will bring about play out. What possibilities do you see? Are you concerned about regulatory, monopoly or net neutrality issues? What opportunities could this deal create for women online?

Integrating Social Media With Marketing And Across The Company

Jeremiah Owyang has an excellent article in Forbes calling on CMOs to learn and deploy social tools to connect with consumers. His arguments support a couple of points that I've advocated for a while now.

First, marketing is the function that needs to lead companies into understanding, adopting and integrating social media tools into their mix. Second, that there needs to be an internal group that educates companies on how to spread the use of social media tools across company functions such as customer service. In either case, social tools cannot only be relegated to the province of outside agencies to implement in short term campaigns.

Two excerpts from the article:

CMOs must think of social marketing as a horizontal effort across all of their digital marketing assets--not as an independent experiment.

and

Dedicated social roles should be enablers, not controllers. We now know that social technologies are pervasive and affect all digital assets. Yet to be successful, CMOs should appoint dedicated staffers to coordinate efforts. Success will require these people to teach, provide resources and select technologies on behalf of multiple business units. Take, for example, Intel's Social Media Center of Excellence, which is a team that trains, helps, and enables other business units with this new medium.

It's no surprise to me that Owyang highlights consumer brands as leading the way in integrating social tools into their marketing mix. At many leading CPG companies it is marketing that leads the business, understands the consumers who purchase their products and owns the P&L for the brands. The marketing function therefore is not only is the natural function to begin the adoption and integration process but to lead company-wide education efforts.

I, for one, am fascinated to watch as this change starts to build.

IDEO: Sharing Ideas

Fast Company reports on the latest innovation in idea sharing from the ultra-cool design firm in "Open-Source Innovation: IDEO's Human-Centered Design Toolkit" by Alissa Walker:

A series of PDFs that are free to download, the Human-Centered Design Toolkit hopes to empower organizations and design firms by giving them their field-tested tools for social impact in a way that focuses more on sharing information than authorship.

I've used IDEO's Method Cards for years now when developing consumer research design. Their approach is not just useful for designing products. I love that rather than holding their innovative approaches tight they are distributing and sharing them. IDEO is unique and highly successful in what they do and sharing in this way is in no way a threat to their business. Rather it helps up everybody's game and builds their brand and business in the process.

Selling Content in a Free World

Newspapers are on a long, sad death spiral. The rise of the Kindle leads reactionary publishers to eye the failed journey of the music business as a model for how to throw tantrums and demand protection for an existing business model on their way to oblivion.

I don't have the answer but I suspect it lies in rethinking what is advertising and what is value people are willing to pay for. I was thinking about music videos which started out as advertising for recordings. Although music videos can be useful tools in selling music, they no longer do much for selling recordings. In this digital era, recordings now serve as advertisements for live concerts in many cases. Recordings can be pirated, experiences cannot.

Publishers, like record companies, seem fixated on being paid for developing and packaging content. Fair or not, consumers have made it pretty clear that they don't see value in that proposition and are no longer willing to pay for it. Therefore, content creators and publishers need to figure out what their content and value-added production and packaging can sell.

iTunes did a great job for years of selling iPods until Amazon figured out how to sell iPods, any other MP3 player, content and Amazon itself much as they are doing with the Kindle. Now apps sell iPods and iPhones and iPhones sell AT&T cell phone service. Cell phone service, other than at the margins, is equally unpleasant regardless of which carrier you choose. There is not much to differentiate carriers other than price for the majority of consumers. Except if you want an iPhone.

Eric Pfanner at The New York Times is musing along the same lines: Pay Walls Alone Won't Save Newspapers.

How about you - any bright ideas on how content, publishing and value can be rethought and what they could sell other than packaged content itself?

Maybe I am a Social Media Expert!

How Knowledgeable Are Marketers With No Social Media Experience?

Marketing Sherpa's Chart of the Week:

Majority of Marketers Believe No Experience is Needed to be a Social Media Expert

Much like Beth Harte and Michelle Tripp, I steer clear of calling myself a Social Media Expert - I consider myself a marketer (one with a record of success and several years of experience working with social and new media) - and for many of the same reasons as they express in their posts. Proclaiming oneself as an expert implies that one believes they no longer have anything to learn. Also, knowing how to use the tools does not mean you know anything about marketing and marketing strategy. Social media marketing is still marketing but with new tools. You need to know both and any "social media expert" who can only help you learn how to use the tools but not also understand why, when and where to use them is not going to be able to help you adopt and utilize them in an effective manner to build your brand or grow your business.

But then I saw the chart above.

Using social media tools, no matter how prolifically, does not mean you understand how to integrate them into a marketing plan. Marketing Sherpa sums it up nicely:

You may have spent a lifetime watching hours of television on a daily basis and being exposed to an infinite number of commercials in the process but, based on that, would you consider yourself knowledgeable about producing a TV commercial? Of course you wouldn’t.

However, since a majority of my fellow marketers believe that familiarity with social media is sufficient and experience using the tools in service of a marketing strategy is not a necessary condition to consider oneself knowledgeable, I can at least not cringe when well-meaning friends call me a social media expert. Though really I'm holding out for social media goddess.

Smart Marketers: Shut Up and Listen

From "Socialized Media" by Tim Manners at Fast Company.  Manners gives excellent examples of what's not working and what might.  I think two key points he makes are valuable to any marketer - 1. listen and 2. add value.  You cannot go wrong by doing those two things.  I encourage you to read the whole article.

As one respondent put it: "If you sell (unless you are a very cool web app), you lose. Don't sell. As a marketer: network. Help people. Advise. Create value and add to the conversation."

Nobody has really figured out how to do that yet. But it's worth considering the possibility that smart marketers won't even attempt to be part of the conversation, much less interrupt it. It could be that the real marketing potential of online social networks is listening, not talking.

The point is, if we're not helping people live better lives, we are not helping ourselves. If all we are doing is interrupting people who don't have time for interruptions, we can't expect their attention. If all we are doing is annoying people who have zero tolerance for annoyance, we can't earn their trust.

If all we are doing is pelting people with endlessly irrelevant messages, we can't claim their loyalty. And if we can't claim their loyalty, we don't have a prayer of a positive return-on-investment.

We can run whatever media-mix model we like, but all we're likely to achieve is a marginal improvement on what is otherwise an unmistakable downward spiral of failure.

Learning the Language of Your Consumers

Are you speaking your consumer's language?  Are you looking through their eyes?

A client recently thanked me for clearly articulating how to explain to customers how the client's services would meet the customers needs.  I thought to myself that it was easy for me to do because as a former insider I can speak the customers language fluently. 

I am always shocked by the number of marketers who advertise and who sell products to consumers unlike them who brag about their lack of familiarity with the language of the consumers to whom they advertise. "I don't know any ads because I don't watch television" they boast.  Or they sell grocery products and never set foot in a grocery store unless the sales team sets up a special field trip for them.

It is imperative that as a marketer you make an effort to listen to and understand and learn to speak the language of the people whose needs you are supposedly meeting.

Sometimes there is a huge disconnect between the people who make a product and the people who use it.

If what this New York Times article points out is true for you and/or your company and you can't learn the language then hire a translator. It will be money very well spent.

Just Because It's Legal Doesn't Mean It's Smart Business Strategy

The United States Supreme Court recently handed down a ruling overturning a longstanding antitrust rule.  Manufacturers now might in some cases be allowed to agree to set and enforce minimum retail prices.  In such cases it would then be more difficult for consumers to shop for a better price because unless a retailer had insufficient competition in a market so they could mark up above the MSP and the presence of competition would lead only to all channels selling the product at the same required minimum price.  The court ruling doesn't allow this kind of agreement in all cases but no longer bans it in practice.  Antitrust suits can still be heard but are to be decided on a case-by-case basis.

The case that led to this ruling was of a manufacturer who wanted only to sell through specialty boutiques that would provide high levels of customer service and not focus on selling the product through discounting.

The underlying case now goes back to a lower court for a decision as to whether or not the manufacturer's marketing strategy is legal.

Should it be ruled legal it is one that I think manufacturers would be foolish to pursue (although one that can be achieved more or less in practice on many products today).  If you want only retailers who provide exceptional customer service to sell your products to consumers then only sell your product to customers (the retailers) who meet your standards for customer service.  Once you sell it to them at the price you can command then it should be the retailers strategy for the market it serves and the competition it faces to dictate the pricing strategy it employs and margin it makes on the product.  Another option would be to only retail and sell your product to consumers directly.  However, manufacturing and retailing are very different business and few companies would be wise to try to do both to the exclusion of all other sales channels.

Another world in which the legal option isn't always the smart option in the long run.  Banking and credit cards, for example.  David Lazarus in his column at the San Francisco Chronicle points out that when it comes to bank fees, banks often profit from deliberately confusing their customers.  Cell phone service providers and credit card issuers benefit from similar tricky language as well.  Companies in these spaces can get away with such practices because they are either following the letter of the law or taking advantage of the absence of regulation.  Such behavior invites consumer backlash and efforts to increase regulation regarding disclosures.

Although such fees gained from customer confusion might be profitable and attractive to Wall Street in the short run, imagine the goodwill and profitability a company could gain in the long run were it to actually operate by serving consumer needs rather than preying upon them.  USA Today offered an opinion piece last year summing it up this way:

What's seems far more unfair — in fact downright sleazy — is imposing onerous rates and fees on consumers and failing to tell them about it in plain language.

In banking, credit unions provide an alternative.  I've been banking with a credit union for nearly a decade, sticking with them even though I live on the other side of the country now because the provide great customer service and make no effort to fool me into paying exorbitant fees.  I imagine I will be their customer for decades to come and they will continue to profit from my business.

Among the major banks, credit card issuers and all cell phone service providers in the United States there are few if any alternatives.  For protection then consumers will have to rely on the government to help rather than giving their business to companies who develop smart, alternative consumer-friendly strategies.

When developing your marketing strategy think about whether you choices are smart or just what you can get away with. 

Lessons Learned from BlogHer Business

Two clear themes emerged from from the BlogHer Business Conference:  First, figuring out if and how to implement social media is confusing for many companies.  Second, the fundamentals still apply.

I was struck by the number of representatives of financial services companies who approached Staci Schiller from Wells Fargo in the lab after the presentation of her case study hoping to learn more about Wells Fargo's pioneering approach to incorporating social media into their marketing mix.  I'm sure each of the other lab sessions had a similar experience with representatives of other types and sizes of businesses seeking the same thing.

With blogging alone, if your company has decided to pursue a blog, who do you have write it?  The CEO?  Company employees?  Freelance bloggers?  We heard examples of each of the above at the conference.  Not to mention figuring out if you should set up shop in Second Life, set up a Twitter feed or how to create a social media press release.

Before trying to figure out the implementation, it is imperative to figure out the goal, strategy and plan.  What is the business goal your company is trying to achieve (increasing household penetration, increasing purchase occasions among existing households, etc...)?  What is your strategy for achieving your goal(s) (a mix of TV, print, PR events, hosting online forums, blogging, ...)?  Once you've determined the elements of your strategy, what is your plan to implement it (find bloggers in house, determining how blogging fits in to job responsibilities, hiring outside bloggers, how to find them, off the shelf technology solutions or custom built, in-house technology expertise or outside consultants)?  That's the point when the question of who will blog comes in.  Figuring out whether or not there's someone in-house to blog should not drive your decision to blog.

Lena West has a great post-conference guest post at Yvonne DiVita's blog, Lipsticking, where she points out that there's always a lot of interest in the "return" of ROI and less in the "investment."  Again, the fundamentals apply.  Social media isn't a magical new marketing bullet, rather there are just new tools.

To that point, Susan Getgood points out that the tools are not the story, the benefits of the tools are not the story (the return Lena speaks of) but rather the content of the story is still king.  A tricked out social media press release doesn't create any magic if all it does is create some links and SEO to a story that's not worth telling.

So for companies looking for the "how" to implement social media, first look at the "why" and then proceed to the "how" and then you'll reap the "return" on your "investment" in planning.  And if it's confusing to figure out if and how social media fits into your strategy and plan and whether or not social media tools will help you accomplish your goals (probably yes if you are willing to make the investment in using them wisely and well) then there are lots of smart folks out there than can help guide you.  Christopher Carfi of Cerado, for example, offers a set of slides to get you started that outlines the elements of a business blog.

Serving Consumers to Alleviate Poverty

The current issue of Fast Company magazine, their "6th Annual Fast 50" offers what they call a "report from the future: 50 profit-driven solutions for what ails the planet."  In an article in this issue, Bill Breen interviews C.K. Prahalad about his book The Fortune at the Bottom of the Pyramid: Eradicating Poverty Through Profits.  Prahalad's thesis explored in the interview is the notion that by serving the consumer needs of the poor, rather than assuming that there is no market and therefore ignoring the poor, is both good for profits and good for working to eliminate poverty. 

FC: How does thinking of the poor as consumers help alleviate poverty?

Prahalad: Because consumption can and does increase income. Consider health care. If you are legally blind with cataracts, you can't work and neither can the family member who cares for you. But if you get access to inexpensive cataract surgery, now you can see and both of you can work. Have you consumed eye surgery or increased the family's earning power? You've done both. It's two sides to the same coin.

What I most connected with in Prahalad's work is the notion that consumption is not inherently evil and that we are not somehow smarter or better when we ignore the poor as non-consumers.  Also, using market driven solutions to addressing poverty often focuses on giving poor access to selling their goods and services.  Less focus is put on meeting the consumer needs of the poor and that is something I particularly appreciate about Prahalad's work.  I hope that more businesses can see that the idea of win-win approaches to consumers having their needs met and companies making profits is not just limited to the realm of "do-gooder" social entrepreneurs and that it is a smart model for businesses of all shapes and sizes.

Full disclosure:  I received an MBA from Michigan's Ross School of Business where C.K. Prahalad is a professor.  I took a strategy class taught by Professor Prahalad and it was the course that most resonated with me so I am admittedly somewhat biased towards his point of view.