Rileybiz

  Mobile Phone is greatest change for the better

Americans looking back at the end of a decade have little love for trends such as reality TV, they are generally positive when evaluating the most basic technological and communications advances that have affected their lives, according to the Pew Research Center for the People & the Press.

Respondents had the overall best view of cellphones, which 69% claimed were a change for the better. Sixty-five percent said the same of both e-mail and the Internet.

Other, more advanced handheld devices, such as BlackBerrys and iPhones, were also relatively popular, though one-quarter of respondents thought they were a change for the worse. Unsurprisingly, younger adults were more likely to be positive about the rise of smartphones, while users over 65 were more evenly split.

Online shopping was slightly less likely to be seen as a good development, at 54% of total respondents. But when it came to e-commerce, 24% of consumers said it made no difference—and younger adults disliked it at more than twice the rate of seniors.

Adults ambivalent about social networking sites

“No difference” was also a major factor in consumer views of the marketing darling, social networking sites. Adults of all ages were notably ambivalent about the sites, though nearly one-half of those under 50 had a positive impression. Despite wide uptake in recent years, the largest group of respondents over 65 did not know enough to say whether social networks were good or bad.

Even active users of social media have registered mixed feelings of the medium with other researchers, however. Crowd Science reported that more than one-half of female users ages 12 to 21, for example, thought they spent too much time with social media.

Printed with permission of E-Marketer; to see data tables, go to E-Marketer.com.

A majority of consumers think technology has made life better in every area except personal relationships, according to the Philips Center for Health and Well-being.

Communication, information and medical treatments topped the areas of their lives that consumers felt were improved by technology. In addition, 64% of respondents said the Internet in particular had made life better, but only 26% said the same of social networking services such as Facebook, MySpace and Twitter.

Durability Top Consumer Concern

Consumers’ biggest concern was that technology be built to last, followed by good quality and the best price. Women were more interested than men in tech that could make life easier, save them time and let them express themselves through personalized features.

Just under one-half of consumers reported that technology was easy to use, and a further 32% felt it had a good mix of advanced features and basic functions. In 2004, only 13% of respondents thought technology was easy to use, indicating a dramatic increase in users’ comfort level.

Respondents ages 18 to 24 found technology easiest to deal with, while those ages 55 and up were most likely to say it was too complex to operate. Men also reported more ease of use than women.

Respondents Believe Tech Companies Understand Their Needs

Growing comfort with technology has come hand in hand with an increase in respondents who believe tech companies understand their needs (37%). Still, a majority of consumers said companies make what they think will sell, and 39% thought manufacturers simply fell in love with their own ideas.

One-third of respondents reported a substantial disconnect with tech marketers, saying companies had no idea what their lives were like or what they would use. Notably, women were 7 percentage points more likely to say so than men.

Printed with permission of E-Marketer; for complete data charts, go to E-Marketer.com

By John Riley

 While today’s political environment is cause for frustration and uncertainty for companies, a new jobs idea being advanced by Senator Charles Schumer (D-NY) and Senator Orrin Hatch

(R-UT) could recharge their business strategies while creating new job opportunities.  In one of those rare bipartisan efforts, the two senators have come up with a proposal so simple and easy to understand, you wonder why no one came up with it sooner.

  If a public-sector employer hires an employee that has been unemployed for more than 60 days, the employer would not have to pay the 6.2 percent Social Security payroll tax for the balance of 2010. The benefit is immediate and the longer an employer waits to hire, the less dollars he or she would receive. It is unbiased in that the 6.2 percent remains constant. A company would save money on an employee who earns $30,000 as well as someone who earns $60,000. There is no cap.

 Whatever losses the Social Security trust fund would incur would be made up from spending cuts in other programs between now and 2015.

 Business Strategies Boosted by Immediate Hiring

 While many companies are understaffed due to severe personnel cutbacks over the past couple of years, this idea provides the opportunity to minimize the cost of staffing up as the economy starts to strengthen. This is more appealing than adding an employee now and then having to wait until 2011 to get a tax credit. Furthermore, the payroll tax stays in the employer’s pocket since the tax is never collected.

 But there’s more. For any worker hired in 2010 and who was retained on the company’s payroll for 52 weeks or longer, the company would receive an additional $1,000 credit on its 2011 tax return. According to the Senators, “Imagine that three million unemployed workers were to be hired this year under the plan. If they all worked an average of six months in 2010 at a salary of $50,000 and every single one of them stayed on payroll for 52 consecutive weeks into 2011, the gross cost of the Social Security tax cut and the additional credit would be only $7.6 billion.”

That would be before the payroll taxes and offsets paid by these workers.

 Additional Rules Needed

 To help ensure long term business growth, additional rules will be necessary:

 1)     Family members of the employer would not be eligible to participate.

2)     Workers would need to work a minimum of 30 hours a week.

3)     The payroll tax plan is limited to the  private-sector

4)     New jobs created by tax dollars cannot be included

5)     Employers with a lower total payroll in 2010 than it had in 2009

cannot participate…businesses cannot cut jobs and still be eligible Unfortunately, there are no rules prohibiting senators and house members from adding amendments or earmarks thereby ensuring what is now a simple and easy to understand idea will eventually become incomprehensible. Nevertheless, it is encouraging to see a promising new idea that can benefit business when it needs it most.   

By John Riley

 It was an affair like most affairs. It started quietly and discreetly. As the participants exhibited a growing passion for the union, they could no longer contain themselves and word spread. Such has been the evolution, some would say revolution, of social media and it’s impact on marketers. And today Nielsen tells us two-thirds of the world’s Internet population visit a social network or blogging site which now accounts for almost 10% of all Internet time.

Thanks to the following Nielsen’s statistics, we have a better picture of social networks and their growth. Remarkably, the time spent on social networks and blogging sites is growing more than 3 times the rate of overall Internet growth.

 Online Marketing Growth for Facebook is Stratospheric

 Facebook alone has increased by 566% from December 2007 to December 2008 and replaced My Space as the world’s most popular social network. Historically, much of the growth started out in younger audiences, but over time that has changed. Facebook is attracting almost twice as many 50 to 64 year olds than the under 18 year old youngsters. This has resulted in social networks being able to offer advertisers a way to reach all demographic groups.

 We also know from McCann Global Research that blogs play a major role in the spread of social media. Their 2008 study revealed that 77% of all Internet users read blogs, an increase of 11% from the previous year.

 All of this growth has not escaped marketers. Since consumers have been flocking to social networks and spending increasing time there, advertisers naturally followed. But it’s not the same. Social networks are both suppliers and consumers of content while traditional media is only a supplier. Because of the highly personal data their sites contain, many of the social networks are reluctant to accept advertising and that complicates matters.

 Marketing Plans Start with Target Audience Analysis

 When a marketer starts to plan an advertising or sales campaign, it starts with an objective that defines the target audience. Trying to identify which social network tool can best supply the audience the marketer wants to reach can sometimes be quite easy because of the digital underpinning of social networks, particularly if it’s a consumer audience that’s targeted. If the target audience is in the business-to-business sector, it may not be so easy because of the type of data needed for the analysis.

 Once that analysis is complete, the next step is to follow the same process with traditional media and then see how they compare in terms of reach, frequency and cost/thousand to the social media data. Then there are the intangibles that need to be taken into account such as the editorial environment or the vehicle’s influence in the market(s) it serves.

 This process has led more and more marketers such as J. C. Penny, Dell Computers and Kodak to shift a bigger share of their market development budgets from traditional media to the social media. Almost daily, announcements appear in the trade press about one company or another moving more of their marketing budget to social media. The trend has almost become a stampede in terms of the number of companies incorporating more social media into their market plans, but it terms of dollars spent, traditional media still clings to a fair share of marketer budgets.

 So what does the marketer get for his or her money? The payoff comes in sales lead generation and brand building and its working.

 The portability of content from device to device represents the future of media consumption. But the device market is constantly shifting, due to changing consumer preferences and an evolving electronics landscape. Device manufacturers, marketers and publishers alike are challenged to make content available where, when and how their end users want to consume it—and that is anywhere, anytime and on any device.

“Even as the landscape evolves, the market for portable electronics is growing unabated,” said Noah Elkin, eMarketer senior analyst and author of the new report, “Always-On Devices and Networks: New Opportunities to Reach Consumers.”

Morgan Stanley expects high-speed wireless Internet-enabled device shipments to more than double worldwide between 2009 and 2013. Other researchers agree that the device market will continue its upward trajectory.

“From their in-home television and entertainment networks, consumers have grown accustomed to an on-demand culture,” said Mr. Elkin. “The combination of always-on devices and networks is helping extend that culture outside the home. For the transition to be successful, devices must provide a good user experience, and content delivery needs to be immediate and seamless.”

Netbooks in particular have struck a chord with buyers, especially attractive in a year of financial belt-tightening. DisplaySearch data shows netbooks were the only portable PC segment to see year-over-year revenue growth worldwide, rising a strong 264% from Q2 2008 to Q2 2009.

But e-readers, smartphones, media players, gaming devices and “tablet” PCs (including the ever-elusive Apple tablet device) are also a major part of the fast-changing world of content without walls.

“Multiple devices, numerous access modes and shifting consumer preferences mean marketers and content owners cannot afford to put all their eggs in one basket,” cautioned Mr. Elkin. “Until formats and device platforms get more established, multimode, multidevice support remains a must.”

Printed with permission of e-marketer. To see the complete article with data tables go to emarketer.com.

By Mike Docherty, Venture 2

In my previous posts in this series, I highlighted examples of poorly integrated acquired innovation and some key success factors.  Here are some examples of “doing it right.”

Examples of companies that have successfully integrated innovation.

Great Harvest Bread:

In an NPR story, part of the station’s “Making Ends Meet” series that aired on October 23, I heard the story of Great Harvest Bakery, a franchise that encourages its franchisees throughout the U.S. to “do their own thing.” In other words, Franchise Central offers guidelines but truly allows frachisees to run their businesses as they see fit.

Often franchises are very conservative and strict when it comes to the leeway(or lack thereof) they give their franchisees in making business management, marketing and other decisions. The three sole requirements of this “freedom franchise”: 1) display the corporate logo, 2) bake the signature honey whole wheat bread and 3) grind fresh flour each day.

Focusing on a Seattle-based Great Harvest franchise, the story discusses the pastry innovation (e.g., “cini-minis”) and the general love the owner for what he has and what he offers. While not a typical example “integration” they have found a great balance between standardizing processes, while allowing individuality to continue to thrive.

P&G MDVIP 

I have previously discussed the interesting example of P&G acquiring MDVIP. It’s a very non-traditional example of acquiring new capabilities and brands. What’s also interesting now is to look back and discover that P&G , that behemoth of a company, that wrote the book on corporate “processes” has actually done an outstanding job of leaving a good thing alone. While P&G has direct involvement in the business (including some co-located P&G people), they’ve continued to allow MDVIP to operate somewhat independently, and have used the venture as a learning vehicle for expanding P&G’s ability to launch and grow service-based businesses, expecially in health care.

Printed with permission of Venture 2.

By Mike Docherty

In my first post on this topic, I discussed the importance of successful integration of innovation acquisitions. It’s a timely topic because increasingly, open innovation is being expanded from simply acquiring/licensing technologies to more situations of acquiring small companies as a platform for innovation-driven growth.

I’m differentiating here between M&A for traditional purposes (synergies, new market expansions, new categories, etc.) and acquisitions driven from the strategic goals of ‘ open innovation’ which are more about acquiring a technology or product platform that can be married with the large companies’ brands and distribution for rapid innovation-driven growth.

More and more start-ups are recognizing the value of selling directly to these large companies versus pursuing venture capital money and/or IPOs  to take the business to another level.  Here’s a link to an interesting article from last year in Fortune Small Business on that topic (I’m quoted in the article). 

In my prior post on this topic, I used the example of Black and Decker and Vector Products as something that represented what I see as an unsuccessful integration. In the post, I discuss how what looked like a smart acquisition turned out to have apparently destroyed the innovation that was acquired.

So what’s it take to make for a successful integration ?

Here’s my list of key success factors:

•  A recognition upfront of the cultural differences and sensitivity (especially on the large company’s part) to          those  differences.
• An integration strategy that deals not just the first 90 days (this is the part companies do well), but also the first 900 days (meaning that companies need to recognize the integration process is a 3-year process, not a 3-month process.)
• A willingness to allow exceptions to the rules–successful integrations allow these smaller enterpreneurial entities to sometimes play by different rules when it comes to financial reporting, bonus,/incentive structure and even reporting relationships.
• Senior leadership’s ability to accept and support ambiguity and dual systems, at least for a period of time. — I use the analogy of China and Hong Kong (somehow the People’s Republic of China has thus far been able to govern successfully under two vastly different approaches without destroying the success of Hong Kong’s openess)
• Most of all, the selection of a strong leader (who has creditability with and strong support of the parent company CEO for the acquired business who understands and can relate to both the parent company’s culture, systems and approaches, and the acquired company’s unique entrepreneurial style.  Often, this will turn out not to be the original founder/CEO, but rather someone who has had experience in both startups and the large corporate environments (likely the parent company).

In my next and last post,  I’ll provide  a few examples of companies doing this well.

Printed with permission of Mike Docherty at Venture 2.

the ability to adapt is the number one indicator for success among managers?

The Center for Creative Leadership’s (CCL) research has been consistent on this point for more than a decade, but the recession-driven turmoil of the past year may prove the point.

North American managers report that 55 percent of the most successful managers they knew displayed the ability to adapt. European managers put the number even higher at 67 percent.

When asked another way, the number one reason why managers derail—fall off the “track of success”— is their inability to change or adapt during a transition.

that the ability to lead across boundaries is emerging as a crucial leadership skill according to the Center for Creative Leadership?

Top executives know the importance of bridging organizational and cultural divides; vertical and horizonal gaps; and stakeholder, demographic and geographic groupings as they seek solutions to today’s most pressing business challenges based on a survey of 128 senior executives. Eighty-six percent of the executives in the study considered it “extremely important” that they collaborate effectively across boundaries in their current leadership role. But just 7 percent of those executives believed they were “very effective” at doing so.

“Closing this gap is both a critical challenge and a hidden opportunity,” says Center for Creative Leadership Chris Ernst.  “Today’s uncertain business environment requires leaders to think and act beyond status quo boundaries. It requires developing new, collaborative boundary-spanning practices to forge direction, alignment and commitment a the intersection between groups.” 

By John Riley

In April 1870, seven nuns left their convent in Carondelet, Missouri on a mission to the Wild West and headed for Tucson in the Arizona territory. Traveling through harsh terrain and facing continuous threats of Indian attacks, they pioneered on by train, covered wagon and boat. By the time the sisters reached Arizona, they had “nearly drowned, suffered from heat and fatigue, and saw the graves of many settlers who had been killed by the Indians.” Settling in Old Pueblo, they started a school a few days later and by 1880 had opened St. Mary’s hospital, the first one in Arizona.

Such nuggets from Arizona history are sprinkled throughout the Arizona Highways magazine from time to time, but the majority of content deals with more contemporary subjects such as special issues on photography, hiking, best places to eat, weekend getaways and family adventures. The writing style is fresh and insightful as one would expect from a native. Forever memorable, the back drop to these stories is breathtaking photography selected by the art director from a treasure of submissions from a remarkable group of photographers.

Attracting Tourists Pays Off

And therein lies the secret to the magazine’s success. Circulation has grown to 150,000 dedicated subscribers who come from all 50 states and over 100 countries. About 60% are in state residents and 40% live outside the state. While satisfying to Publisher Win Holden, members of the State legislature, under which the magazine falls, are more excited about the 37.4 million tourists in 2008, a significant increase from the 35.2 million in 2007. A 2005 study attributed $35 million of tourism revenues each year to the publication.

Arizona Highways is a self sustaining publication that doesn’t receive any funding from the State. And Holden plans to keep it that way. He has reengineered the organization, saving approximately $600,000 per year, and hired and retained a first-rate management team.

A New Dynamic

Whether you want to read about the ‘rootin, tootin and shootin old west’ or contemporary spectacles of tourists hiking in the Grand Canyon, you’ll find it all as you move from one issue to another. These stories don’t develop by chance. Editor Robert Stieve has brought a new dynamic to the publication with disciplined planning at the core of the process. The staff takes pride in the 11 international magazine awards for writing, photography and design given by the International Regional magazine Association.

“We’ve worked to slowly migrate from sedentary content to service stories such as hiking and adventure travel guides,” says Holden. “When the publication started in April 1925, its purpose was to showcase the work of the Arizona Highway Department. By the 1930′s the charge was prophetically changed and Arizona Highways became a tourist publication. Today, that mission has expanded to promoting travel to and through Arizona.”

Creative Talent

It is all made possible through the use of 300 photographers, illustrators and writers who regularly contribute to the magazine. With access to such a talent pool, it extends the magazine’s capability.  But they are aided and permanently blessed with access to some of the most beautiful landscapes anywhere in the world. The results speak for themselves.

Magazine covers cry out for attention as they portray nature’s best…for example, Sedona’s Cathedral Rock at sunset, a lightning storm over Tucson at night or snow covered ponderosa pines in the Apache-Sitgreaves National Forest. But it’s the mountains that create the spiritual aura over the land and give visitors and residents alike pause. One can only admire the talent of the photographers, illustrators and art directors who are able to bring the reader into that moment.

Letters from Abroad

Reading the letters to the editor that come into the magazine each day, you quickly sense the pride that Arizonans have about their State, many of whom have subscribed to the magazine for 15 or 20 years. Those from outside the country are equally interesting. Typical of the letters is this one from Margaret K. in Belmore, Australia:

” We received a subscription to your magazine from an American ‘friend’ whom we met in Bali last year. I love your magazine…the photography, the stories, the colors of the Arizona desert and mountains are just amazing. We have some pretty amazing colors in our deserts and mountains in Australia, as well, but I think I like yours more because of the little fantasy I have that one day I’ll get to visit.

Sounds like Margaret is planning a visit. Arizona Highways at work.