John Akerson's Thoughts

Business, technology and life

Smart Advertising

NPR had a really wonderful Morning Edition about the value New York City’s Times Square billboard Space on December 30th of 2010. Their piece had the inaccurate (but executive pleasing) title:Billboard Advertising In Times Square Pays Off   I was listening while driving to NYC to see the ball drop.   Does that advertising really pay off? Not necessarily.  SMART advertising pays off but there were two pieces of advertising in Times Square that could have been vastly improved.  Looking at the TDK advertising, as I did for about 5 hours on New Years Eve, it was striking how counter-productive it was.  I went back to the podcast and transcript, and confirmed that in the radio piece, Lisa Chow of WNYC interviewed John Connolly, Chief Operating Officer of Duncan Donuts.

Lisa said “Let’s see who’s advertising here. We’ve got Toshiba, Budweiser, Dunkin’ Donuts.”

Lisa did not even mention TDK. Lost in the crowd of a million freezing new year’s eve rockers in Times Square, I saw the enormous TDK billboard too. I researched it, and found that  TDK upgraded their billboard in December of 2010.

Everyone noticed the TDK billboard. How could you NOT notice it? Lisa Chow may have noticed it, but didn’t say a word. The problem is that advertising isn’t always SMART advertising.  In the New Year’s Eve crowd, I heard several people ask aloud if Cassette Tapes were making a come-back.  

I suppose that just KNOWING what a cassette is qualifies me as an old person, but if the old people know what TDK is because of cassettes, and the younger people don’t know what TDK is, what value does TDK get from a multi-million dollar billboard in NYC’s Times Square?   I think their value is less than zero. the billboard does nothing to tell any of their possible customers what TDK does, and because there is no connection to current products, viewers are left with the “are cassettes making a comeback” thought – or for younger viewers, the billboard gives absolutely no idea what TDK is.

What is TDK today, beyond the cassette? It is a huge, successful company that reported during their 1H FY2011 period – coverinf April 1, 2010 to Sep 30, 2010 –  they had $5.2b in net sales and  >84,000 employees.   TDK makes billions by producing and selling huge quantities of unmentionable electronics bits: capacitors, displays, print heads, transformers, etc.  Impressing people in Times Square is likely one of the purposes of their advertising. That billboard isn’t very smart advertising because only an extraordinarily small percentage of people passing One Times Square will ever look at their website, products or financials. The billboard doesn’t mention their website, their products, their global scope If they are spending this much money on advertising, perhaps they should use the display space to let people know that TDK is more than cassettes.  Perhaps a newly inspired “TDK-Inside” logo for this century??

Perhaps smart advertising could tell people what TDK is, what it does, who benefits from its products and why there is some advantage in selecting or using products that have TDK inside… Smart advertising could illustrate features, benefits and competitive advantages for TDK. (just like it does for anyone)

*Thanks to TDK for all those SA-C 90’s, and thanks to


January 4, 2011 Posted by | Competitive Advantage, Marketing | Leave a comment

Best Buy

Best Buy stock plummetted 15% yesterday.  The headlines were all about “Q3 Profit Misses, Outlook Slashed” but I think the real story goes way deeper. source: Yahoo Finance

If you look at the numbers – their Q3 net income was $217m (54c/share) compared to $227m (53c/share) in the same quarter during the previous year.  The previous year was one of the most difficult years in US business history. Their stock dropped like a rock, from about $41.70/share, to about $34.50/share.

Seeking Alpha thinks Best Buy is being “unduly punished by Short Term Factors” and they might be correct, but I think their stock price reflects risks.

If you just look at numbers and projections, the stock IS undervalued in the 9.5x P/E ratio/ $34-35 range where it is at.  

The stock is undervalued in the 9.5x P/E ratio/ $34-35 range where it is at – if one only considers the numbers. It is extremely significant that their net income dropped between these particular quarters in these particular years. The economic climate was so much worse last year. There should have been growth. Best Buy’s net income drop goes deeper than the appraisal of delivering products to/for customers that weren’t there. Best Buy’s customer service issues are significant and not necessarily related to how many people are on their floors.

Their marketing dept would probably pick a generic version of me as their perfect customer: An employed geek with a couple of thousand followers who knows the difference between 60hz and 240hz, the difference between i3 and i7, the difference between wireless g and n, and is extremely impressed by the performance gains delivered by SSD as compared to 7200 rpm.  

My very personal and admittedly anecdotal experience is that their service is so horrid – that their prices, selection and availability just don’t matter.  I should be their customer, but I am not. When a business loses its target-customer base, drops in net income are a predictable result.  Facebook shows such a negative reaction to Best Buy – and Victoria Barret pointed out on Forbes that YouTube and Netflix are competitive problems as well. She thought their competitive advantages were around viewing patterns.  Netflix and YouTube excel in customer service, and I think that it will be essential for Best Buy to master the customer service components.

Bernhard Warner (Social Media Influence) looks at Best Buy’s social media efforts and distills their issues: 

“we get news that Best Buy is finding it difficult to compete with the likes of Walmart and Amazon. com who seem to be doing a better job of discounting and delivering a more satisfying customer experience. In the retail business, mastering those two parts of the business and you usually finish with a strong quarter. Only after that should you focus on new apps.”

Best Buy’s stock might certainly be a bargain, but the current price figures in the risks of their complex competitive  landscape and whether Best Buy can recover, or if they are on the Circuit-City path.

December 16, 2010 Posted by | Business, Competitive Advantage | Leave a comment

Sad Suicide

Mark Madoff’s suicide touched me. 

On the morning of December 11, 2010 — exactly two years after Bernard’s arrest — his son Mark Madoff, age 46, was found dead in his New York City apartment. The initial ruling for the cause of death is suicide by means of hanging.”   I did not know Mark Madoff or any other member of his family. Mark Madoff profited from an enormous Ponzi scheme that his father ran from a business that MARK worked for – for more than 20 years. He profited from his father’s scheme that resulted in the destruction of billions of dollars of wealth, charitable foundations. It was a scheme that has inspired/caused/incited other people’s suicides.  

Mark Madoff and his brother Andrew probably understood or should have understood what was going on. They were educated and experienced.  One had a degree from the University of Michigan and the other a degree from the Wharton School. Both had worked for their father’s firm since the 1980s.   (Ironically, they worked there from around the time that Michael Douglas’ oscar-winning performance as Gordon Gekko who said that “that greed, for lack of a better word, is good.” in Oliver Stone’s Movie: Wall Street)

Given Mark’s involvement in the family business, it is amazing that he and his brother turned their father in to the SEC. It is possible, as ABC contends, ‘I’m going to say you knew nothing about it, because I’m seventy years old, you’re forty, you’ve got children. So I will take the fall for this.’  It is also possible that they realized what their father did, and turned him in because they felt ethically compelled to do so.  It seems that their family has been destroyed by their decision to turn in their father.

Mark’s Mother Ruth Madoff – his estranged mother – blames his father for his suicide.

I am saddened by Mark’s death. I know what it is like to lose a parent. I know what it is like to feel pressure.  I cannot imagine what it must be like to have an $80m lawsuit filed against me, to have bankruptcy trustees after me, to betray my father in an act that results in a 150 year prison sentence, and to live with the aftermath.   There’s a small list of people who understand that – probably only one now:  Mark’s brother Andrew.  

I don’t for a second condone what his family did and I don’t think anyone should. Yet his suicide still touched me. I feel sad for his family and for his children. His children will now grow up with a grandfather who is in prison and knowing that their father killed himself, hung himself with a dog leash on the 2nd anniversary of their grandfather’s arrest. In committing suicide, Mark picked a final, sad way out for himself.   I don’t think  are any ethical lessons beyond the WAY obvious ones. There’s no techie thing here, no marketing thing, no business thing – just a human thing.

Mark Madoff’s suicide is just sad – just a sad suicide.

December 13, 2010 Posted by | Business, ethics, Life, People | Leave a comment

300,000 Android Phones

Andy Rubin has only ever made 2 public tweets and only follows one person. His twitter page links to – which was last alive as a website with a binary dog portrait in 2008 or so. This morning he tweeted: “There are over 300,000 Android phones activated each day.” (Andy Rubin is also VP of Engineering overseeing Android at Google, and he knows how to design products that customers LOVE.) @Engadget pointed out that 300k Android Phones Activated DAILY is an increase from August when only 200k were being activated daily.  A 50% increase in 3 months is an incredible business trend.

THIS seismic shift will bring a tsunami of opportunity for businesses that are creative enough to harness it. Tsunamis are destructive too, but thats another story.How significant is this? Two days ago, Penny Crosman in Bank Systems & Technology published “Who will be the Google of Mobile Payments” and discussed the tangled mess of providers, banks, systems and technology.

She didn’t make the case that the “Google” of mobile payments could be GOOGLE. Given 300,000 Android Phones activated *DAILY* that has to be worth consideration.


So – that is only mobile banking, and that is just a ripple. The tsunami has to be understood creatively, by the businesses who will use this explosion as competitive advantage. Want to sell a mobile app? Android has 300k new users each day.

Even considering Android as one of the big 3 or 4 types of smartphone – with Blackberry and iPhone, and … others, it is very safe to say, the trend is for Android smart phone domination. There are only a few models of iPhone, and only one manufacturer each of iPhones and Blackberry phones. (The key corresponding fact, is that Android is on dozens of phones made by an array of companies, and Google shares success with all of them… Motorola, LG, Samsung, HTC, etc.)   To flesh that out a bit… It is in the corporate interests of all of those cell phone producers to help Google succeed by selling more android phones. Even Google’s competitors are selling phones that spread Android. For instance – Google opened their bookstore 2 days ago. As ironic as this can be – Amazon is discounting the Droid Pro to $19 each.  Google is smart and they ARE going to take advantage of this installed base.

When your platform is exploding, and your fiercest competition contributes to your expansion – well, that is a bit like IBM selling PC’s and including Microsoft’s DOS as the key component that made a PC “IBM-Compatible.”  Good for IBM, but VERY good for Microsoft.

Beyond Cell Phone manufacturers, Android users use more data than other smartphone users, which will make them a favorite of cell companies who want to profit from data transmission. “Samsung Galaxy users typically upload 126% more data than iPhone 3G users, and HTC Desire users download 41% more data” (Arieso)

Want to be available to mobile users? 300k per day is a trend that you MUST account for.

December 9, 2010 Posted by | Business, Competitive Advantage, Marketing, Technology | 1 Comment

Competitiveness and Personal Data

Technology competition is ramping up everywhere, and it surrounds the value of Personal Data.   Google is launching its E-Bookstore to compete with Amazon, Apple, and others. Facebook is releasing a new “profiles” feature that will certainly compete with LinkedIn and Twitter, and Google Buzz.

Motorola’s Droid Pro has to be giving RIM nightmares because the reasons for having their Blackberry are dwindling at an amazing speed. Cellphone competition is at a feverish pace. As Verizon prepares to get the iPhone, it sounds like they’re willing to pay Apple to prevent either Sprint or Tmobile from getting it…  Google released the new Nexus S phone  with a reference build of their android operating system, with no additional-anything to impede user experience. (TechCrunch says that “Google’s various apps, some of which are unavailable for the iPhone, that make it the best phone on the market today.”)

All of the technical competition has a downside though… Google’s Nexus S has a Near Field communication, NFC, feature that will let you use the phone in lieu of a credit card by simply tapping it against a device in a store. (read more about that here)  Given the data that they gather every second about customer preferences with their search engine, and the data that they gathered over the last few years with Street view – One has to wonder about the data they will gather from their Ebookstore and their Nexus S. One has to wonder what Facebook is going to gather with their new Profiles Feature. Another good question is… WHO is Facebook competing with there? Is it LinkedIn? Is it Twitter? Is it Google Buzz? or is it just Facebook improving for the sake of improvement? And what personal data will THAT improvement release?

Given the enormous value Google reaps from its growing googlebytes of data, it seems safe to question every “technical” advance, innovation, invention and announcement in terms of what personal data will be freshly captured for corporate plundering.

Is it all about the data? Should we be concerned about Ford gathering consumer information with their “Vehicle Interaction Revolution?” The new MyTouch feature of the Ford Edge understands thousands of commands. It connects to Cell phone, MP3 player, USB drive, SD Card… and features an ADHD-enabled delight: “Two 5-way switch pads on the steering wheel with 3 LCD displays – 2 in the instrument cluster, and 1 in the center stack. The available MyFord Touch™ features an 8-inch touch-screen display in the center stack.” (I’d love to trade my 10 year old Ford Explorer in for one. I’d think of it as a Ford Digital Explorer!)

Does it know how to phone home?  How long will it be before your Droid Pro can sync with your Ford Edge to update your Facebook Profile with 4Sq information, and feed all that into Google’s database so that Groupon can target you with an advertisement?  How much personal data is too much?

What do you think?

December 6, 2010 Posted by | Business, Competitive Advantage, Life | 1 Comment

Black Friday is Dead

Black Friday, the Friday after Thanksgiving, is a day that combines a recipe of these ingredients: pent-updemand, planning for holiday gift giving, end of year bonuses, excessive credit, retailer desires, and a deluge of advertising across all forms of media. It is one day, marked in black, when retailers theoretically break even for the year. It is a day that serves as a standard measure of the economy.

According to USA Today, “Last year, the Thanksgiving shopping weekend accounted for 12.3% of overall holiday revenue, according to ShopperTrak. Black Friday made up about half of that.”

Link to Tombstone Maker
Black Friday is dead. Why? It is dead because people love options and alternatives, because some people hate crowds, and most of all because every retailer is now offering more and more options. Here are a few: Buy online, buy on Thanksgiving day, buy on Cyber Monday, buy a week before Black Friday, buy the week after or on any of the shopping days between Thanksgiving and Christmas, or – simply choose not to buy.

Breaking news today shows Black Friday sales rising modestly or enormously, but each article is just showing a small piece of the Black Friday pie.

Here’s some information from Yahoo: “U.S. online sales were up 33 percent on Thanksgiving this year, according to IBM Coremetrics, signaling irresistible promotions in advance of Cyber Monday, the kick-off to the online holiday selling season.”

Major media outlets like Reuters are saying that U.S. retail sales on Friday rose a mere 0.3 percent from the same period last year, while traffic rose 2.2 percent, ShopperTrak said. Heavily discounted merchandise may increase volume, but negatively skews sales data while cutting into profit margins.

But that is just a little piece of the real story. Paypal money transfers increased enormously, and further, Paypal data suggests that the “shopping season began on Monday, November 15, 2010.”

 How significant is that?  Here are some other tidbits of data: 

“Black Friday 2010 resulted in 21 percent more total payment volume compared to Thanksgiving 2010. PayPal saw 19 percent more payment volume on Black Friday 2010 compared to an average Friday in 2010.  PayPal processes 16.5 percent of U.S. eCommerce and 15 percent of global eCommerce.”

So – is there a 0.3% increase? Or a 27% increase?   Experts had forecasted a 2-3% increase

And many enormous retailers were open on Thanksgiving day. (Including  Sears, Toys ‘R’ Us, Kmart, Walmart, Gap, Old Navy and others) My local CVS pharmacy was open until Midnight on Thanksgiving. Many of these retailers had Black Friday deals available early. Many online businesses offered Black Friday deals early.

The cumulative effect is that Black Friday isn’t comparable to last Black Friday because the buying has been moved to a multiple-day, multiple medium affair. What was once confined to a day and a physical location is now everywhere over several weeks.

Black Friday is dead. We will still have a “Black Friday”, and will still call it Black Friday, but sales will begin earlier and earlier and last later and later. Combining that flexibility with online sales will mean that at some point, we might start calling it “Black November-December”  Whatever it is, and whatever it is evolving into, it isn’t Black Friday anymore.

What do you think?

November 28, 2010 Posted by | Business, Life, Marketing, Social Media | 1 Comment

Nissan & Facebook

Timothy Tiah wrote a thought-provoking review of the Web 2.0 Summit in San Francisco last week. It has some amazing contrasts of facebook.

On one hand Fred Wilson thinks of Facebook as a photo/chat site. On the other hand Mark Zuckerberg wants it to be an idealistic, privacy-eliminating uber-platform that he can run like a government-less big-brother.  I think it is somewhere in the middle, but with the potential to go either way. As the Facebook “company” grows, it will be less and less of Zuckerberg’s vision, and more of Fred Wilson’s, HOWEVER – So many people are clueless of both potentials, that there is really no way to predict.

 Jeremiah Owyang pointed out this morning that companies are self-depreciating … of their OWN brands when they point to*** instead of their own sites. When I read that, I immediately thought of Nissan’s weekly emails promoting their “master the shift” contest. This is a weekly contest designed to publicize the Nissan Leaf, where they direct contest participants to instead of their own site. They aren’t selling a Facebook Leaf, but do they know that?  Well, maybe Nissan is an exception, though. They don’t even own – so, seriously- Perhaps they have bigger issues.

What do you think?

November 24, 2010 Posted by | Competitive Advantage, Marketing | 1 Comment

Brilliance in Red Socks

I spent two amazing days last week at the Internet Summit 2010 in Raleigh, NC. I was amazed at the wild collection of brain-horsepower – a group of people that Joe Procopio calls the “Jocks and Cheerleaders of Nerds”  Who were these people?

There was Paul Lee – who started his discussion by thanking Jonathan Arehart for “tweeting the hell” out of the speakers – and then speaking at length about how game-ifying things provides enormous motivation for people. (Think about THAT: Essentially, he gamed the 15o0 attendees into tweeting even more, and particularly about him, proving his point with his own presentation – so smoothly that almost nobody noticed)  He also advised Chip Perry, CEO of, that when he listed competitors, he ought to consider how Facebook was going to change the game for I don’t think Chip knew what hit him.

There was Dana Todd – firey intellect powerfully seeping out to the very roots of her hair – predicting that i-Ads were going to probably dwarf Google, Yahoo & Bing advertising.  If she is correct, Apple is undervalued by at least 200%, and everyone at the conference needs to understand the potential impact.  I’d bet that less than 5% of attendees had considered i-Ads’ potential impact.

Eleanor Hong was calmly riveting with discussion of news, search, and search in news, and – well, how social growth and news ratings interact.  Here’s a link to her presentation. It reminded me a bit of the problem with schrodinger’s cat. If you measure something, the act of measuring it has an impact. News, Media, and Social media statistics, to me, seem to reflect this. An event happens, it is reported, it is blogged, it is tweeted, it is FB’d, etc. It is an endless real-time churn.   Jenny Halasz told everyone about Linked in Signal. When she asked, I am a witness, that not a single person in the room had heard of it. (except perhaps Dana Todd, who had tweeted about it before the summit, but I don’t remember if Dana was there.) That is both a huge compliment to Jenny, and perhaps an eye-opener for Linked-In’s marketing team. (The conference WAS the target audience and NOBODY had heard of Signal.)

There were others who were a bit behind the times. “How many people in the audience have a Facebook account” is really not a valid question for that audience. There were many who were just a wee bit too self promotional. I’m convinced that one of the speaker presented self-promotional information that was either mis-informed, deceptive, or perhaps just plain lying. There were also questions that weren’t asked about every topic. Sometimes the probing should have been deeper. Statistics and sources should be questioned and understood, not glossed over. But these things were sharp in contrast because they were exceptions to the rule of “amazing-informative-powerful” that dominated the Internet Summit. 

And in this bright, shiny intellectual solar system, Bob Young stood out. Bob was pure Brilliance in Red Socks. He spoke with reverence about the people he shared the stage with, a senior Googler, and an IBM Fellow. In the most humble way, he explained how he respected IBM because they put customers first. He explained how he admired Google because he wasn’t smart enough to work there. (Really?) He spoke a bit about his company – – a company that aims to transform media slightly less than Gutenberg did. There was a chart showing how in 2000, there was 1 printing press for every 50,000 people in the world, but now, in 2010, there are 5 devices capable of print for every person.  There was discussion about how 50% of all printed books are never read, and end up in landfills.

Bob impressed as the sort of person who reads business statistics about Amazon selling 24 e-books for every Kindle they sell, and seeing the goodness in saving 12 quarter reams of book paper and a pint of book ink as resources saved for the world… instead of seeing the Kindle as a money printer that will do more for Amazon than it’s cloud services ever will.

So – what did I enjoy most about Internet Summit 2010?  Bob Young in the question and answer section. The unscripted brilliant firey thought, so powerful that his hat couldn’t contain it – so powerful that it ripped right out of his socks.

Bob said:

  • “Before thinking about what’s next, think about what we’ve already done”
  • “Congressmen are not part of “us” – they need to understand … so they might write laws to promote freedom… Freedom is NOT empowered by anarchy.”
  • (in discussing internet fraud) “These guys are evil, but you have to admire it because they do it so well”
  • “good content isnt going to be written unless people are paid to write it”
  • We are raising the most literate generation in the history of mankind- because of technology, not in spite of it.”

Cord Silverstein’s idea is that for next year’s Internet Summit Keynote, just invite Bob, and have him talk about whatever he wants to. He isn’t suggesting that merely because Bob’s Red Socks can be seen from space… and not because Bob’s 64 minute NC State “Leadership in Technology” piece can be seen here…  I think Bob stood out because he wants technology to do good things, humane things, beneficial things, charitable things. Bob’s Aunt may have given “one of the single largest charitable donations in Canadian history“, but Bob is not about money. He is about doing things that will benefit people –  no, rather, he is about doing things that will benefit HUMANITY – things of depth, things of gravitas, things of consequence. 

Bravo Bob! May we all find a way to create a tiny fraction of your brilliance in the work that we do.

November 23, 2010 Posted by | Business | 1 Comment

Smart Phones Rise

I am at Internet Summit 10 and I have noticed that Mary Meeker’s quote about smart phone numbers exceeding personal computers by 2012 has resonated with everyone.  To refresh, her quote is: “smartphone sales will surpass PC and laptop sales in 2012, with more than 450 million units sold.” So – the panel is talking about technology, infrastructure, net neutrality and how important it is to focus on customers…

Dana Todd  asked, “For marketing people like her, how do they deal with that technology” She meant the increase in smart phones, the changes in how people use technology. She wants to know how the increase in mobile information technology will impact what she needs to do as a marketer.  When mobile users exceed laptops, netbooks, ipads and other personal computer devices – how can marketers best deliver what customers need?

How will Mary Meeker’s projection change what people need? How will it change what people buy, what people use, what people want and what is important to people?  (assuming that people = customers)

These are great questions – what do you think?

November 17, 2010 Posted by | Business, Competitive Advantage, Continuous Improvement, Marketing, People, Technology | Leave a comment

Shifting Media

Media is changing, rapidly and thoroughly. I think the only certainty about this seismic change is that if you could ride a Delorean 10 years into the future, what media will look like then bears absolutely no resemblance to what it looks like now. How will it change?  Opinions vary wildly based frequently on the benefits seen by the person expressing the opinion.

Avner Ronen, Boxee’s CEO thinks that a payment platform will win over TV networks.  Bruce Eisen, VP of Online Content Development and Strategy for Dish Network thinks tomorrows media distribution model will be today’s, unchanged. But things are already changing in extreme ways. Greg Kampanis, an executive from South Park Digital Studios has seen that offering all of their shows as free content online has resulted in “an increase in ratings along with online advertising revenue.”

And Michael Willner, CEO of Insight Communications asks if Hulu is bad for Broadcasters.

Mr. Willner’s most essential point is about the viability of the current distribution model. To quote: “Eisen’s argument is that even if putting this content online for free has short-term benefits for broadcasters ultimately it will encourage more users to cut ties with their cable or satellite provider, undermining the current distribution model.” (I added that emphasis, here, to make my point.)

The current distribution model is like a woolly mammoth and broadcasters are like little birds that ride the mammoths. At some point, the woolly mammoth became a species doomed to extinction. Some birds hopped onto elephants instead. Some found other ways to survive their ever-changing, evolving environment. Some of the birds didn’t make it. Some of the elephants did.   The ones that thrived were the ones that were both smart enough to recognize the changes and fast enough to react.

I think that Bruce Eisen is in a difficult position, and if he thinks that South Park’s benefits are only short-term. Things are not going to settle back to a 1980’s paradigm where media is controlled by the current industry giants.  There are so many disruptors in the current woolly mammoth-dominated media environment. Although many things are difficult to predict, the future of those mammoths isn’t. The smartest will see that the “current distribution model” isn’t the same as the future distribution model.  Acting like those things are the same, is understandable, and protectionist, but isn’t the most productive long term strategy.

A better approach is to consider, given the current distribution model, and the currently known disruptors, what other distribution models can simultaneously deliver value to viewers and profit to companies that act as media managers, creators, producers and aggregators.

I think Netflix is poised to deliver on that simultaneous-value sweet spot, and their freely-available corporate strategy/playbook suggests they already know it. 

Who will their competition be?  Will they succeed? Will Dish? 

What do you think?

November 11, 2010 Posted by | Competitive Advantage, Continuous Improvement, Marketing, Technology | Leave a comment