Henry Phish

This is just pretty and disturbing and kind of odd, but it gets the point across. Reminds me of the Last Tree in a Museum commercial I saw growing up. I’m not really sure what Quercus is, but it sounds like some kind of environmental organization and typing their name into a web browser comes up with this. If this is at all related to JJ Abrahms, please let me know.

Quercus Global Warming Video

CNN last year posted a list of 2006’s dumbest business blunders.

Of note is number 4, GM’s make your own commercial contest as part of their Apprentice promotion in which participants created commercials with slogans such as: “Yesterday’s technology today” and “Global warming isn’t a pretty SUV ad - it’s a frightening reality.” While a good idea, on paper, online communities have a habit of revealing your faults if you give them the chance.

Other interesting moments are number 10, Comcast repairman falls asleep waiting for customer support…the owner of the house made a video…

Long story short, when your customers have complaints, it pays to listen. They probably have a point…and eventually these things come back to bite you in the ass.

101 Dumbest Moments in Business - 2006

A very good reverse history of Apple Inc using video to show how the companies product line has evolved as the company has grown. I’ll be posting a similar article about Microsoft next week. Pretty cool.

A Brief Reverse-Chronological YouTube History of Apple

IBM has always been a forward thinking company, moving from mainframes and typewriters to personal computers in the 80’s, then to laptops and patents in the 90’s and ultimately becoming one of the worlds biggest overall solutions providers in the 2000’s. According to Wikipedia, IBM employees have earned three Nobel Prizes, four Turing Awards, five National Medals of Technology, and five National Medals of Science, so when IBM pitches you something, you just might be smart to listen.

With green consumerism becoming a popular subject in the media these days, and having written a few articles on it myself, I found it interesting to note that IBM has a popular ad campaign currently running along these lines. Check it out.

For more on green in culture and business, read:
Corporate Culture and a Greener Tomorrow
The Green Scare

Product Recalls - Ouch that Hurt

So in the last week or so, GM had a recall for 944,000 vehicles for a window washer fluid issue that posed a fire hazard.

As stated in the article:

GM is aware of three fires caused by this problem, two of which were in the company’s own test fleet vehicles, GM spokesman Tom Wilkinson said. The company is not aware of any injuries caused by the problem.

What a product recall this soon after the announcement of the Volt and the Cruze, restructure talk, a brand new marketing campaign, and everything else that’s been in the news and media in the last few months is that we want our customers back, and we’ll go the extra mile to get them. There’s a definite thought process behind all of this, and it wreaks of marketing, but at the same time you can see that GM is turning a corner here.

They have a year before the Cruze is released in Europe, and much like Ford, many of their mainstay vehicles are just now being updated with pre-existing technology to run more fuel efficiently. Trucks and higher priced cars continue to be hurt by gas prices and consumer spending. Current small cars such as the Aveo and Cobalt are temporary solutions, but GM needs to make them work, and at a low price point these vehicles offer customers a cheap alternative to the more expensive foreign models.

The recall itself is a simple installation of a fuse to shut off a circuit board in the event of a malfunction, but this simple act is an instrumental factor in maintaining GM’s respectability in the eyes of the consumer; it holds the company accountable.

GM can benefit a lot by building themselves up as an American brand with a face, that’s something that foreign companies can’t do really well in this country, and it’s something that can keep the American consumer coming back to GM despite it’s issues.

Part 4: Foreign and Emerging Markets

Layoffs, Restructure, and the Big Loan

An article from 2005 stated this about GM:

General Motors Corp. (GM), the world’s largest automaker, said Tuesday it is restructuring its engineering and design operations to better leverage global resources, accelerate product development and, ultimately, reduce expenses.

“GM’s future success in the global automotive marketplace will depend heavily on our ability to fully leverage our broad and deep resources, especially in the critical area of product development,” GM chairman and chief executive Rick Wagoner (search) said in a statement. “These changes will accelerate our efforts to get more great cars and trucks to market faster, to provide more value to our customers and to increase our global sales.”

These days, with the release of plans for the Volt and subsequent redesigns of their product line, downsizing their truck production, expansion into foreign markets such as Europe and China, the fruits of their labors are finally being realized.

Catching up to the present day, GM has released follow up plans for their restructuring process that includes:

1. Further salaried headcount reductions in the U.S. and Canada in the 2008 calendar year
2. The elimination of health care coverage for U.S. salaried retirees over 65, effective
January 1, 2009
3. No new base compensation increases for U.S. and Canadian salaried employees for the
remainder of 2008 and 2009
4. No annual discretionary cash bonuses for company’s executive group in 2008
5. Reducing truck capacity by 300,000 units by the end of 2009
6. Reducing and consolidating sales and marketing budgets
7. Holding engineering spending in 2008 and 2009 at 2006-2007 levels
8. Cutting 2009 capital expenditure plans to $7.0 billion from $8.5 billion
9. Significantly reducing spending for non-product programs
10. Taking aggressive actions to improve working capital
11. Suspending future dividends on common stock, effective immediately
12. Raising $4 billion to $7 billion through asset sales and financing activities

In the last few months, GM has aggressively tried to meet these requirements.

-With the public press release last week concerning GM’s early retirement package for 9000 workers in which a plan was stated to make 20 percent cuts to their salaried work force. Strategic closings are not unheard of in the industry as a whole. It’s almost a given that there may be some downsizing, though GM has gone through several plant closings in the last few years, so this may limit the impact.

As it were, company officials this week gave autoworkers at its metal stamping plant in West Mifflin, near Pittsburgh, an update on plans to close that 58-year-old facility by the end of the year, said Rick Mismas, shop chairman of the UAW Local 544.

-Other moves to cut costs can be seen in the proposed sale of GM’s Hummer subsidiary, which has seen sales plummet 40 percent this year, and while lucrative in the past, has fallen on hard times with rising gas prices and consumers love affair with more environmentally friendly vehicles such as cars. While proceedings have been slow, a sale of Hummer would be a boon to their bottom line.

-The dividends were suspended which should create more liquid cash for new product development.

-Advertising for major events such as the Academy Awards have been all but done away with, though advertising as a whole seems to be at an all time high. I’m seeing nothing but GM on television and the internet these days. The employee discount program even has me looking at a GM, and I have a Camry.

-Finally with the announcement of the Chevrolet Cruze, the restructuring of a plant in Lordstown, OH to produce it, and the announcement that GM is asking for $50 billion in federal loans to build more fuel efficient cars, it’s obvious that big things are happening in Detroit.

The $50 billion dollar loan is an interesting side note as far as the US government is concerned, since support of American interests in business has been a high priority with them in recent years …especially with Bush in the presidency. Now is a pivotal time for American manufacturers, with foreign car makers a few steps ahead; without support and a solid plan they could easily falter. I, however, just don’t see that happening. I think they’ll get the money they ask for…most of it anyway.

So what does this say about GM?

GM is backing up what it says it is going to do, and while downturns in the market can’t always be anticipated, they’ve laid out a plan and are sticking to it. They are consolidating their dollars and moving funding toward research and production. The only thing they are lacking is a surge in public support for their product…something that looks to be on the horizon if things hold true to form.

Part 2: New Products and Old Standbys

For additional info see:
GM Profitable Again by 2010

So continuing with the article I wrote the other week on Subways current marketing philosophy, I was thinking I might elaborate on a thought I’ve been having over the summer: viral marketing rules.

What Subway really needs is to get back into peoples psyches again, and viral marketing could be a real groundswell movement.

There’s a real niche with the college and twenties demographic that really responds to viral marketing. With a mature brand such as Subway, people already know your product, what you want to sell them is a lifestyle choice; this type of ad campaign is great for that. Much as McDonalds has done with catchy jingles and their family values ads, Subway could do with hip and trendy online videos, websites, and interactive media.

Check out this ad for cell phone popping popcorn on youtube as a prime example:

The ad itself has been seen by millions of viewers and has garnered a lot of media attention. A good viral marketing campaign could really capture peoples imagination, and bring them back to conscience thought about a brand that has begun to stale…no pun intended.

So what is the cell phone popping popcorn ad selling? Cellular gadgets, and I need one!

I found a good article on the New York Times site that shows how add campaigns for home loans have changed over the years. It’s interesting to see how the campaign evolves with changes in the economy, going from sales of second mortgages to people in dire financial straits to home equity loans for upper class types needing money for home improvement or a better car. The ads themselves change quite a bit as well, moving from more practical advertising model that sells the direct benefit of the product to more sympathetic better life advertising. It just goes to show how customer needs and an expanded demographic have, over time, changed the marketplace.

Home Equity Frenzy Was a Bank Ad Come True