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Tech frailty in 2016

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In the course of history, many smart people have been scared by the rapid progression of technology and its impact on the way we live. Forget the printing press; Socrates was concerned that even the technology of recording via written documents (i.e. writing) would “create forgetfulness in the learners’ souls, because they will not use their memories”. One need only look at the graphic above, representing swings in market share for tech titans, to see significant change in just the past 35 years.

January has been a difficult month for the stock market, with share prices around the world taking a tumble. A lot of the liquidity in the market rests on the valuation of a growing number of technology firms, whose route to profitability varies wildly. The oft-written about “Unicorns” are seemingly due for some market correction – no bad thing for the tech sector – but what about the bastions of the industry, how are they looking?

Twitter – The firm would have breathed a sigh of relief at the end of last year, when original co-founder Jack Dorsey committed to returning to the company. There were promising sounds at first, but recently it has been mulling a move away from the 140-character limit that defines its modus operandi. It has the potential, according to Forrester, to repackage such long-form fare in the mode of Facebook’s Instant Articles. But attempting to emulate what has already been done cannot hold any hope for actually catching up with its rival. An article in The New Yorker this week derides the social network, calling out its lack of direction, and questioning its relevance in a growing pool of competitors. Twitter’s US penetration has been flat for the past three quarters, and Snapchat is nipping at its heels in terms of engagement. While overall Twitter is seeing steady growth, it’s rate of growth continues to decline

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Facebook – By contrast, Facebook is doing well, particularly concerning its financial performance. Its increasing collaboration with telcos as it explores new revenue opportunities pave the way for sizeable rewards in the medium term. And it is slowly learning from the likes of WeChat and Kakao Talk in Asian markets on how to better integrate various functionality into its Messenger app; it’s first foray is working with Uber to allow users to hire a car without leaving Messenger. (This week Whatsapp also begun to get the message, no pun intended). We commented in our last article about how the social network is fast having to adapt to an ageing user base and lower engagement, but Facebook is attempting to combat such trends with numerous tactics. Sadly, its attempt to provide free internet services in developing markets has run into obstacles. In both Egypt and India, government regulators have interceded to stop the network from running its Free Basics service, under the guise of net neutrality (which in our opinion stretches the definition, and the spirit, of net neutrality).

Yahoo – The troubles for this company are more than we can summarise in this short review. Let it suffice to say that Marissa Mayer’s wunderkind sheen has been significantly tarnished since her arrival at the company in 2012. In an editorial in the Financial Times last month, the company was described as a “blur of services and assets of different values”. As her inescapably significant role in the organisation’s lacklustre performance becomes increasingly apparent – hedge fund Starboard Value has issued an ultimatum for her to either leave peacefully or be replaced by shareholder vote come March reports are that Mayer will have to lay off around 10% of the company. The FT puts it well,

[R]ather like AOL, it is considered a service stuck in internet dark ages. It is what grandma uses to look up the weather. It is not for Snapchatting teenagers. And it is not what investors crave most of all: the prospect of growth.

Amazon – Until this week the company had been faring extremely well, and its most recent concern was not getting investors too excited about its recent profit announcement. And while it’s reporting this week of a 26% YoY rise in sales was welcome, its fourth-quarter profits of $482m were one-third lower than what Wall Street analysts were expecting; the stock plunged 13% as a result. The disparity between rising sales and profits that don’t align to such a rise are nothing new for the company, unfortunately.

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Holistic sector frailty – Two excellent articles in The Economist this month reveal a sector that is experiencing growing pains as the current digital era reaches a period of relative maturity. As the hype dies down, what hath such new ways of thinking, making and working wrought? The first article examines the seemingly glamorous role of a techie working in a startup firm, and the pitfalls that come with it. The article reports that “Only 19% of tech employees said they were happy in their jobs and only 17% said they felt valued in their work”. In looking at the explosion of demand for the inadequately named Hoverboard, the second article identifies that globalisation has vastly sped up a product’s journey from conception to delivery at a consumer’s home, at the expense of a proper regulatory system; it is unclear with so many disintermediated players who should shoulder the burden of quality control. The Economist sees such risk as a parable for the tricky place the sector as a whole finds itself in.

 

Here Come The Boys!

January 27, 2011 3 comments

Retailers and brands in dire need of some Sexual Equality

Thanks to an increasing number of ill-advised comments by Andy Gray and Richard Keys and declarations by MP Dominic Raab that men get a raw deal from ‘obnoxious feminist bigots’, sexual equality has suddenly become such a hot topic across the UK that the economy-ruining snow has melted away.

However, before we start preaching about how middle-aged sports presenters need to brush up with what is and isn’t an acceptable way to behave in 2011, we may want to look closely at our own industry and address the outdated way many brands and retailers still deal with the reality of the modern male shopper.

The conclusions of a recent study by Saatchi & Saatchi X suggest that just as women are fully entitled to get offside decisions as wrong as their male colleagues regularly do, so men are encroaching onto the traditionally female territory of ‘shopping’.

The study further implies that the failure to create retail experiences that appeal to men’s needs limits their engagement and that we need a much better understanding of the whole male purchase journey. Their Director of Strategy Simon Goodall notes,

“Men love doing things they can do well. They like opportunities to demonstrate mastery, which means they like to go into a shopping environment knowing the answers to questions they might want to ask.”

Goodall also believes that retailers ought to do more to help men find the information that they need to make decisions before they reach the check out.

This view supports the findings of OgilvyAction’s 2008 global study examining the decisions that shoppers made in store. Managed and analysed across EMEA by yours truly, this research suggested that across a range of categories, UK males were generally less likely than females to know which brand they are going to buy before entering the store.

Anything that helps with that decision making process should be considered.

Craig Inglis, Marketing Director at John Lewis states that men dwell less than women when shopping and are more rational and pragmatic in their shopping habits. Thus, male-oriented areas of the store should be clean and modernist with obvious signposting to help men navigate their way around the store.

However, brands and retailers can begin to engage men long before they reach the store. Goodall cites Best Buy’s ‘Twelpforce’,  which offers advice on Twitter as an effective example of a retailer engaging with men and empowering them with the information they crave.

Twelpforce: A good example of engaging men

What’s more, cracking the male shopper is something that will only grow in importance.

A recent study of 2,400 men in the US by online giant Yahoo! revealed that 51% of respondents believed that they took a primary role in buying groceries.

Yahoo’s Director of Research and Insights, Lauren Weinberg, commented that while panellists may have inflated their involvement in purchase decisions, male customers’ perceptions of, and interest in, shopping are changing fast.

Regardless of whether some respondents exaggerated their role or not, the results indicate that gender boundaries are disappearing and modern households no longer see grocery shopping as a ‘womans job’.

Within the set that is ‘Male Shoppers’, we also need to understand the different mindsets men have across different categories, retail environments and lifestages. For example,  the Yahoo! study found that fatherhood was influential with 60% of dads claiming to be the decision maker across a range of categories including pet care, clothing and packaged goods.

All of this means that brands need to think not only about who they target, but also how they represent men in their adverts.

John Badalament, a writer and founder of website ModernDads.net believes that “Men need to be something other than invisible or buffoons in advertising”.

Domino’s Pizza: Not such a good way to get men onside

Not only do such depictions alienate men, but a 2010 multinational study by EuroRSCG found that there was a “pining for chivalry” from women in the developed world and that “young people want to see demonstrations of male strength and responsibility.”

Chivas attempt to celebrate chivalry

Dove celebrate ‘being a man’

Even a seemingly harmless campaign like P&G’s Behind Every Olympic Athlete is an Olympic Mom Winter Olympics ads resulted in grumbling from underappreciated dads, who still make up the vast majority of volunteer coaches for youth sports.

There is clearly still plenty to learn about engaging male shoppers effectively, though with the Yahoo! research finding that men are more brand-loyal and less focused on promotions than female shoppers the rewards for those who are successful are huge.

Either way, just as it has become clear that old dressing room banter is no longer appropriate in a TV studio, so it is equally apparent that failing to engage such an influential and  lucrative proportion of shoppers is just as unacceptable.

Transparent Blackberrys

August 4, 2009 Leave a comment

From the August Zeitgeist…

Research In Motion, of Blackberry fame, have been somewhat nervously watching iPhone’s app empire build and Google’s Android software take off. Though Blackberry’s [rather large] niche in the business world is secure for now, competition is increasing. This article revolves around the necessity for both clarity of brand and clarity of privacy.

The brand has been trying recently to spread its wings in its campaigns to accommodate things you wouldn’t normally associate with it, such as not having to constantly respond to mind‐numbing emails. This puts the manufacturer in a difficult position; other than the TV spot below, it was unclear to what extent the brand was embracing the mentality of appealing to broader and more disparate audiences.

Now Mashable reports that Blackberry has developed a social network, which launched recently. This seems to gel nicely with its new desire to appeal more to non‐business users. The network, dubbed, inspiringly, “MyBlackberry”, “offers social profiles, app recommendations and more[.]

BlackBerry’s real goal is feedback and getting customers to answer each other’s support questions”. While this may save the technical team time, it’s not certain to bring much benefit to the user, who will most likely not be looking for a collaborative Yahoo! Answers‐like approach to their important technical question. It will have to convince those users used to seeing their device simply as a way to phone and email others. Moreover, finding users who have the time to participate in MyBlackberry and whose company has not for security reasons restricted access to programs like this (and the chat service that comes as standard), will prove difficult.

Concerns over security were highlighted last week in the UAE when thousands of Blackberry users unwittingly installed spyware on their handsets, thinking it was a harmless update from their network provider, Etisalat; who were in reality receiving private user data until RIM put a stop to it. The incident reveals that blind trust can be easily exploited. The backlash to follow, however, will certainly benefit the rival network provider, Du, and the uproar this incident has caused in international news should be a reminder for companies to always spell out even the smallest changes in the way information about their clients will be collected.

Previous examples of this include BT’s experiment with Phorm, and Facebook’s short‐lived venture with Beacon, which Media Week called “catastrophic”. In today’s current technological – never mind economic – climate, people are demanding transparency; whether it be from banks or network providers.

Microsoft and Google

August 2, 2009 Leave a comment

From the August Zeitgeist…

Tensions between Microsoft and Google have long been simmering; here we look at Microsoft’s recent moves and effects they are having on its brand.

On 29th July, Yahoo! and Microsoft announced a search deal in an attempt to compete with Google, though it seems a fair bet to say the latter will benefit in the short-term as the two companies spend time integrating. Microsoft is talking up its upcoming operating system, unimaginatively titled “Windows 7” and promoting its new Internet Explorer with a graphic commercial, that anyone watching won’t soon forget, although it’s unclear what Microsoft is trying to say about its brand or audience here.

Windows Vista has proved a disappointment; Reuters reported that many companies thought it “unstable”. The newswire service now reports that according to a recent survey, 60% of companies surveyed will not be upgrading to Windows 7.

On July 8th, TechCrunch led with “Google drops a nuclear bomb on Microsoft. And it’s made of Chrome”. In 2010 Google will launch an open-source, lightweight OS – at first on netbooks – in an “attempt to re-think what operating systems should be”. Google pointedly note that current Oss “that browsers run on were designed in an era when there was no web”, makes it even more painful. TechCrunch points out, “What Google is doing is not recreating a new kind of OS, they’re creating the best way to not need one at all”.

The ever-impartial Bill Gates is quoted in Brand Republic saying the Chrome OS is “nothing new”, noting that the fact that Chrome is both an operating system and a browser shows how broad the term ‘browser’ has become.

“The more vague they are, the more interesting it is… It just shows the word browser has become a truly meaningless word… In large part, it’s more an abuse of terminology than a real change.”

Perhaps product differentiation rather than pedantry would have benefitted Microsoft’s brand more? The battle of browsers, operating systems, and words, continues.

The new search deal means that strategies for digital campaigns must now increasingly be thought of in the context of Bing/Yahoo! algorithms and SEO, as well as Google. It also gives clients more choice and flexibility, as Sir Martin Sorrell noted: “It is very welcome for our clients as it brings more balance to the search marketplace and may moderate pricing.”