Can Nokia win against the iPhone?

Nokia, the world’s largest-volume cell phone maker, recently shocked the world by announcing that it would begin using Microsoft’s Windows Phone 7 platform on its smartphones. Since 2008 Nokia has invested heavily in its own smartphone platform, the Symbian platform. Symbian was intended to power mobile devices and become the basis of an vast mobile device ecosystem. Symbian however found it increasingly difficult to be competitive new platforms such as Apple’s iOS and Google’s Android. Nokia responded by developing a new smartphone platform, MeeGo. During a joint announcement in February 2010, Nokia and Intel shared their partnership to develop the MeeGo platform. The goal was to have MeeGo power Nokia’s future smartphones and prove a worthy competitor of Apples iOS. Unfortunately, MeeGo failed to meet expectations and timelines. In fact, MeeGo has yet to ship in a commercially available product. This has left Nokia without a competitive product in the smartphone marketplace for a number of years.

In a surprising admission, Nokia’s CEO Stephen Elop stated that his company lacked accountability and leadership. He even went so far as to say Nokia struggled to deliver innovations quickly.

This lead to Elop’s announcement on February 11^th,2011, that Nokia would use Microsoft’s Windows Phone 7 platform in its’ smartphones.

Has Nokia made the right decision by abandoning its mobile platform?

Did Nokia make a mistake by choosing Microsoft’s Windows Phone 7 instead of Google’s Android?

Can Nokia find its way to compete with the iPhone?

Will Nokia’s selection make them more competitive in the smartphone marketplace?

CNN: Nokia’s announcement

http://articles.cnn.com/2011-02-11/tech/nokia.microsoft_1_windows-phone-nokia-smartphone?_s=PM:TECH

Engadget: Stephen Elop’s memo

http://www.engadget.com/2011/02/08/nokia-ceo-stephen-elop-rallies-troops-in-brutally-honest-burnin/

GM Opening Up Pandora's Box

GM has recently announced it has decided to partner with Pandora radio to offer streaming radio content in the 2012 Chevy Volt and Equinox.

The move is partially in response to Ford's success in partnering with Microsoft to offer Sync in many of its vehicles, which has been particularly successful in attracting younger consumers.

Dubbed "Chevy MyLink," the system boasts a 7-inch color touchscreen located in the vehicles dashboard.  Going a step further, GM has also partnered with Nuance, which will allow the system to respond to voice commands from the driver to control their cell phones and select radio stations or songs.

GM Executives Dan Akerman and Micky Bly noted an improvement in vehicle technology was a top priority, and GM's ability to keep up with the pace of technological improvement was not something they could do successfully without the right outside partners.

Pandora has already been in conversation with Ford, BMW Mini, Diamler AG, Mercedes, Toyota, and Hyandai, however, GM believes its system is superior in that it allows drivers to control settings on Pandora from the vehicle rather than the connected smart phone device.

Chevy will continue to offer XM radio in its vehicles and coupled with MyLink, drivers will be able to stream graphics to vehicles as well.

Questions to the Class:

1. Do you think GM and other auto manufacturers are sacrificing safety to attract new youthful consumers?  At what point, or under what circumstances would public safety officials become concerned?
2. Do advancements in vehicle electronic systems present opportunities for companies like Apple to potentially broaden its current revenue mix?
3. Do you see these types of offerings transitioning from a focused marketing strategy to a more main-stream strategy as the population ages?  
4. Is it sustainable over time in terms of attractiveness to the consumer and profitability for the manufacturer?
5. Given GM and other manufacturers are outsourcing this technology to outside firms, do you think there is any opportunity for the development of a sustainable competitive advantage?

Mermaids, coffee, and...outrage?

Secondary link: http://mediadecoder.blogs.nytimes.com/2010/10/12/gap-inc-puts-gap-back-in-logo/?scp=1&sq=gap%20logo&st=cse

In March, Starbucks will change its logo. They will be removing the words "Starbucks" and "coffee" from the logo in an attempt to revitalize the brand. As a semi-regular (1-2 cups per every 1-2 weeks) customer, I haven't noticed a change in product or service at all, ever. For me, its always been the same thing, since I started going to Starbucks. I guess I'm surprised that a minor logo change gets this much attention. What's also surprising to me is the fact that there were comments of "outrage" over the logo change. Perhaps surprising is a strong word. Enlightening may be more appropriate. Do Starbucks, or customers in general, align themselves that closely with a brand? Do customers actually think that if Starbucks changes their brand identity via a logo change, that they lose their identity?

Why did Starbucks change their logo? Do you think that the logo change is meaningful? Do customers have a reason to be outraged, or is this over-hyped media looking for something to write about? Is it a trailing marker of the final steps of a strategy, or the first steps of an implementation?

Can Sony and Others Finally Bruise Apple?

Sony announced a new music service, called Qriocity, that will launch Sony into the digital music streaming business. Sony wants to shed its past failures at building iTunes-like music downloading service and delve into what it predicts will be a growing new segment of the digital music industry.

Sony is building this service into all the hardware products that it sells as well as offering it on their playstation network. Sony believes that introducing this service into its already stable and profitable playstation network will help get the new service running faster than starting from scratch.

Sony believes that consumers are tired of the limitations of downloading music and using iTunes for managing their music. As the article states, "The iTunes software has become an almost unbearable drain on computer power. More importantly, the public seems to have lost interest in buying downloads." I am interested to see how well Sony's Qriocity music service will penetrate the market.

Can Sony, as well as other music streaming services make a dent into Apple's market share?

What must Apple do to defend its market share?

Should Apple expand into the music streaming business?

Mediums vs. Emotions: Advertising in the 21st Century

In this Forbes Magazine article, Patrick Vogt explores the “future value of online relationships for brands, and how companies can make stronger connections with customers across multiple media channels.” His argument is that the goal of advertising is to create an emotional bond with consumers and contrasts how social media, internet and traditional TV advertising can be used to create this bond.

Television advertising is still seen by most as the most emotionally resonant advertising medium. In fact, TV ads are making a comeback with television advertising projected to account for over half of all advertising growth in 2011. On the other hand, internet and social media provide the ability to target, track and report data through personalized and relevant messaging. While these digital mediums are fairly uncharted for many brands, success stories like Old Spice show the value in getting online messaging right.

After contrasting these different mediums, Vogt argues that, in the end, the channel doesn’t really matter. While advertising channels change and evolve, the goal of advertising remains the same. As Vogt says, “Advertising success is predicated on igniting a creative spark that flares into an increased share of voice across today's fragmented audiences. Technological innovations come and go, but some things will never change.”

Questions:
1. Do you agree with Vogt’s premise that the goal of advertising is to create an emotional bond with consumers? If so, why? If not, why not?
2. How does Vogt’s argument about the goal of advertising fit with the marketing goal of creating and communicating value to consumers? Does it seem consistent or does it feel like a throw-back to a “selling” view of marketing?
3. What type of advertising does your organization engage in? Which of these mediums (TV, internet, social media) do you use and how successful have they been?

The End of Discount Pricing

In this article Rafi Mohammad argues that companies should avoid offering discounts as a way to increase sales. He uses the example of Pizza companies that have recently reduced their prices and are now offering $10 any size, any number of topping pizzas. These discounts did increase sales for companies such as Dominos and Pizza Hut but how will consumers respond when they have to raise their prices back to $16.00 a pizza?

Rafi argues that companies should use an adaptive pricing model vs. the broad discount pricing model. Adaptive pricing capitalizes on the fact that different consumers have different needs and therefore place a different value on certain products or services. By using adaptive pricing companies can adjust a products attributes to better appeal to a consumer without having to lower the price.

To illustrate the benefit of adaptive pricing Rafi uses the example of Subway and Quiznos. Subway reduced the price of its foot long subs to $5 vs. Quiznos which created an entirely new set of less expensive sandwiches. By doing this Quiznos was able to still charge full price for its signature sandwiches and avoid the dilemma that Subway will face when the economy turns around that they are faced with having to raise prices.

Do you think that the pricing model that Rafi advocates in the article is an effective way at increasing demand while avoiding price decreases?

How can companies like Subway and Pizza Hut raise prices without sacrificing demand when the economy turns around?

Can you think of some other examples of adaptive pricing?

Infomercials - An effective form of advertising?

Some products can be successfully pitched to the public through the usual 30 second commercials inserted into prime time programming. Others, however, may require a little more explanation or promotion in order to appeal to a niche market. Instead of producing a standard print ad or 30 second spot, some companies use a long form video format known as an infomercial. An infomercial is generally a combination of information about the product and a promotional commercial.

An infomercial can be scripted in a number of ways, depending on the nature of the product and the buying habits of its intended demographic. Some infomercials duplicate the format of a television talk show, with either a recognized television personality or a skilled actor portraying a host. The product is usually presented as the topic of an extended interview with the inventor or other "expert." Between interview segments, a more traditional television spot gives viewers more specifics on the product's price and ordering method.

Although a number of modern infomercials have found mainstream acceptance, the infomercial format still has some challenges to face. The claims made about a product in an infomercial, for example, are not always examined as rigorously as claims made during a television news interview. An infomercial can be an effective form of advertising, especially for niche market products.

Infomercials have some advantages over the mainstream advertisements - since they are normally long form, they have the advantage to overcome the obstacles of selective retention. Also they create an environment where the audience is absorbed to make an impulse purchase. At the same time, the infomercials are expensive, risks are higher and the products can be assumed to be cheap.


Questions

What are the benefits and negatives of using infomercial?

Is this form of advertising suited only for certain products/services?

What is the future of infomercial?