I caught an article the other day on how Nintendo is expecting shortages in it’s Wii production through the holidays. This has been a problem for the last three years.
Historically, Nintendo tends to be a little conservative in it’s production, no doubt due to it’s smaller size, it can’t afford over production like many of the big companies such as Sony or Microsoft; still, Nintendo has years of experience in the industry, and it’s a little surprising that they are having difficulty meeting demand after three years of sales. It just goes to show however that the innovative nature of the Wii is a great selling point, and shouldn’t be underestimated. Sales for this system just keep going up and up.
The thing about retail and the seasonal shopping season is this, most retailers do not turn a profit until after the holiday season. Without adequate and in demand products on the shelves, sales numbers go down because retailers don’t have anything to sell. Retailers don’t like this, and may give you less favorable shelf space in favor of products they can sell more of…reducing your marketability.
Further, Nintendo in their infinite wisdom has lost the sale of the Wii’s it couldn’t produce, which is less money for them initially, and more on the back end since they’ve failed to sell any periphreals or games for those systems. Also, if a customer decides to buy a X-Box or Playstation instead, then the entry cost for that customer has just gone up…because it’s going to take a lot more marketing dollars to get them back.
Near as I can figure, that’s why X-Box 360 is the number one system right now, since the system is cheaper and more available than the rest.
Honestly though, I think I’d rather have a Wii…they make it look fun.
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.
So after all the hype around Google and Chrome in the last couple of weeks, I got to thinking about Microsoft, and how they were chalking up these days. The funny thing is, they really aren’t that exciting.
A couple weeks ago they bought Bloomberg for a bunch of money just so they could get their hands on Ciao.com, which is essentially one of a thousand sites set up to drive web traffic to other peoples sites…in this case retailers, but why did Microsoft require, what amounts to a billboard on the side of a concrete wall, in order to make their brand more visible? I already know who Microsoft is…in news and media this is just another tiny mark on their earnings board.
The Less is More Philosophy at Large
Microsoft over the years has relied on quantity over quality in regards to their brand. More is better has always been their slogan. It’s a Bill Gates/Steve Ballmer tradition that has worked well for them, but with other companies entering the marketplace, such as Google, Apple, Firefox, and Blackberry; each with better brand identities and a more focused business plan, Microsoft is failing to compete.
The Perfect Example of the Microsoft Strategy…think of this as being applied whole company.
The other day I watched a news program on CNET or CNN, I can’t remember which, advertising the newest version of the Windows Mobile platform. The guy from Microsoft that introduced the product seemed uncomfortable, and honestly the interviewer wasn’t giving him much of a chance to speak, so I really can’t blame him. However, the whole interview just demonstrates the lack of esteem that Microsoft products are held in these days.
In the world of cell phones for example, the products Microsoft presents lack the luster of products such as the Blackberry with it’s proprietary OS, or Apple, with it’s scaled down version of OS X. In the Blackberry, we have a product that is ergonomic and sensible, something that makes people want to pick it up and play with it. In the IPhone, we have something that has a little flair, but is still practical enough to use from the very first moment you pick it up. What I would compare Microsoft’s products too, and honestly their marketing in general, is that hunch back with the lazy eye from Young Frankenstein; you just keep looking at it, but that eye never goes away.
Most of their products are a little ugly. A little too techie maybe. Not organic enough. Not intuitive enough. Just something isn’t right about them. It just screams, stay away from me, I don’t want you. If I saw one on the counter next to one of the other two phones, I dare say it would probably scream at me if I picked it up.
Thinking back to the monopoly lawsuits Microsoft has gone through over the years, their branching across categories and industries, strong arm tactics, guerrilla warfare tactics and the like, their products mirror their corporate philosophy. In fact, it was the simple act of Bill Gates quitting as CEO and moving into a philanthropic organization that really gave Microsoft any sympathy in the media. Let’s face it, Bill Gates is the founder, and the face of Microsoft, and what he does dictates how the company is perceived.
The Current Face Of Microsoft
Microsoft is pretty well cemented in the workplace with products such as Windows Vista and their Office line. Their real world media empire is fairly secure as well. Companies such as Bloomberg help add to this content, but the company as a whole has an image issue, and all the synergy in the world won’t change that unless the leadership at the top takes the necessary steps to kick this company into gear.
Their brand has to change with the times, and become something that people want, not just require. Microsoft has the resources to do it, but it’s going to take a lot of blood sweat and tears to change a company culture that has long been mired in making the market come to them instead of making products for the market. It’s about time they recognized that competition is good for them…it promotes innovation…and they need some.
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
I caught this article on the Google finance site talking about how unpopular models have slowed down auto sales in some cases. For instance, the Pontiac G5, Pontiac G8, Saturn Astra, Saab 9-7, and Saab 9-5 have all had less than stellar sales records in the last year. With the emphasis on gas mileage and smaller size vehicles figuring prominently with consumers right now, many of these vehicles are not making the grade.
GM’s president and chief operating officer, has ruled out closing or selling any of GM’s eight brands besides Hummer, which GM has put up for sale. But he hasn’t ruled out getting rid of some of its slow-selling models.
GM needs to establish a precedent of core, quality vehicles that consumers can rally around.
An article from Bloomberg yesterday states that Bankruptcy risk in American car companies may decline with U.S. loans. Like Fannie May and Freddie Mac, GM and Ford are both integral parts of the U.S. economy, both in the jobs they provide and the products they sell. A lot of American is wrapped up in these companies. Both companies have laid out significant rebuilding strategies, and the United States government isn’t likely to ignore them when push comes to shove.
As stated in the article:
The companies have made the loans their top lobbying priority as Congress returns today for a shortened fall session ahead of the presidential election. The automakers and their suppliers are trying to get the initial funding appropriated so it’s available before the new Congress and president take office.
The loans, intended to assist the shift to more fuel- efficient vehicles, will gain political support because of the importance of Michigan, Ohio and Pennsylvania as swing states in the U.S. presidential election…
It’s a good article that pretty much lays out the issues pretty well. For more info read:
An interesting, albeit short, news piece about Googles ten year run to becoming the worlds leading search engine. The piece also covers growing issues such as monopoly concerns with their Yahoo deals, growing competition among rivals and the like.
Like I mentioned last week in The Search For Google Alternatives, with the release of Chrome web browser, as well as the Android mobile operating system, Google has positioned itself as the dominant brand on the internet, well ahead of past contenders such as Microsoft, Yahoo, AOL, etc. According to one statistic posted on a Microsoft blog, Google currently makes up 70% of all web searches on the web. With the addition of Yahoo to their advertising stable, this statistic grows considerably. So essencially what the news piece is saying is that Google has become a vertical advertising monopoly.
To be honest, Google doesn’t really control the internet. I can go to any site I want regardless of weather Google wants me there or not. I can pick any advertisers I want on my site including Amazon, Google, and currently Yahoo, and the only stipulation I have is that they provide relevant advertising and hopefully…and I said hopefully…some money. The thing that makes their advertising better than others is brand recognition, since people can advertise through any service they so choose. Technically it’s up to individual sites to choose whom they use as advertising, and if Firefox or Microsoft came up with a better system of advertising then I’d use that. If Cuil.com decides one day to make an advertising program based on onomatopoeia and fuzzy logic, then I’ll use them too. As far as Yahoo plastering their site with Google ads, so be it, they have the authority to do so. The case itself is kind of crazy, and the fact that everyone loves to hear about the Google success story, and the fact they do well enough at matching ads to content, are the only two reasons they don’t have much competition.
Just remember how it works though…if they ever do become evil, there will be ten companies trying to pick up the slack…and six of them will be run by former Google employees, two from Linux Redhat, one from Firefox, and one from some guy in a bar that wrote his idea on a napkin and someone gave him a bunch of money for it. Googles going to be screwed.
A few of the products were quite ingenious, such as a Finding Dulcinea.com, where web editors actually search for the best web sites to visit in order to answer questions and only give you the best twenty results…it sort of reads like an encyclopedia of web browsing.
Another example is Cluuz.com which gives site searches based on symantics…it reads like a dictionary.
Finally, Cuil.com, which says it has access to more sites than Google. That may mean they turned some of the porn filters off, or it may mean that they are developing a site using fuzzy logic search rather than popularity metrics.
According to the site:
Rather than rely on superficial popularity metrics, Cuil searches for and ranks pages based on their content and relevance. When we find a page with your keywords, we stay on that page and analyze the rest of its content, its concepts, their inter-relationships and the page’s coherency.
As it were, I’m just beginning to think that Google is nearing that place in their career where they may just be brushing up against outsider status.
With new companies beginning to find niches and developing ways to do things that are different than the preconceived, it’s only a matter of time before one or two make a break from the pack and try for a spot at the top.
Further, with Google breaking into markets such as Google Android, Google Doc, and Google Chrome, it’s not long to wait before we see an operating system with Googles name on it butting up against Windows and MacOS; vying for global supremacy. They have a few tickets for the big games now, and that’s just why Microsoft offed Netscape ten years ago.
I’m not saying that Google is Microsoft and that they’ve reached some pinnacle and are going to knock down anyone who climbs a bit too high. At this point they are noted for being the nicest kid on the playground, but it’s interesting to think that they might just have matured enough to be the elder statesman in the development community, and it should be fun to see how this progresses.
While I can’t claim to be an expert on foreign markets by any stretch of the imagination, when creating an article about GM’s New Pitch, at least touching on the subject seemed like a no-brainer. Unfortunately, there is so much information out there, and GM is such a large company, that I couldn’t even begin to talk about all of the assets and activities and subsidiaries and export hubs because it would take me a good month just to get one article up, and my readers about a week to read it.
As it were, here are some of the highlights:
With the U.S. economy in a downturn, much attention has been given to overseas assets and sales, where the industry wide slump is not so noticeable.
For instance, GM just opened a new plant in India that has been charged with developing new models as well as continued production of small cars and SUVs.
India is being eyed as a future hub for export of small cars to places such as the United States.
“The company will invest half a billion dollar in India over next seven years to keep the growth momentum. A good part of this will go into the development of new models, including a small car next year, and upgrading the existing ones that will result in a new Optra in 2010,” said Karl Slym, president and managing director, General Motors India, at the launch of its utility vehicle, Tavera Neo 2. Maruti Suzuki India (MSIL)
Further, GM has begun to position itself in foreign markets such as China, Russia, and Brazil where sales growth is encouraging. Russia for instance is expected to see sales growth of 10 to 15 percent annually and sold 523,000 vehicles last year alone.
Asia, Europe and Latin America are now the bright spots on GM’s balance sheet, with the company selling more cars overseas than it does in the US. “Asia is front and center in terms of strategy and future direction,” said John Bonnell, director of forecasting in Asia for J.D. Power & Associates. “Their big success story is in China.” Much of Asia remains the home turf of Toyota and other Japanese manufacturers. Although General Motors has increased its market share in Asia, by its own calculations, to nearly 7% from 5.9% in the last three years, its sales remain small compared with North America, where it still makes one out of every five cars sold. But GM’s smaller stature in Asia and the lack of any legacy costs of pensions and health care have allowed the company to be more nimble. Using technology from Asian partners, GM is aggressively marketing itself as a producer of smaller, fuel-efficient cars. In Thailand, GM has also benefited in the last decade from its partnership with the Japanese truckmaker Izuzu, which provided engines for GM pickups and gave it access to suppliers.
While this isn’t a news piece about GM specifically, it demonstrates why recalls, as well as a good track record in quality, are so important to consumers.