Toyota and Panasonic are getting mean - pressuring employees to buy their products.



(Re: Panasonic, see http://www.marketwatch.com../news/story/panasonic-dire..cts-mangers-buy-its/story...aspx?guid={E58559A2-14DF-4..963-9359-71F2438770E7}&dis..t=msr_2)



Employee sales are almost always a small percentage of overall sales.



Employees alone can't and won't solve for Toyota or Panasonic’s current problems which are dictated by the economy (exogenous factors), not limitations of the companies' respective product portfolios.



Panasonic wants its 10,000 managers to buy $2,200 worth of extra Panasonic product by July of this year. That’s pathetic. It’s mean, too.



If every manager were to spend an extra $2,200, $22-million in
incremental sales is realized. Considering Panasonic's operating margin
of 5.7%, Panasonic would realize an extra $1.3 million in operating
income.



In 2008, Panasonic generated $4.59B in operating income for the full year. An improvement of $1.3-million is an incremental .03% - in other words, near zero.



Messages for Panasonic: First off, stop bullying your managers! You need your top managers now more than ever. Second, be honest; an extra $22-mil in sales will have no tangible, noticeable effect on your holistic financial performance.

So Mattel has its 3rd product recall in about as many weeks.

(see Financial Times article)

 

So... the real question -- IMHO -- is will consumers commit to paying more for safer (ethically produced) products?  Not just toys, but everything.  If something seems so cheap at retail; that we in Canada or the US are nowhere close to competing on a production cost basis; is that not a warning sign that it might just be too good to be true?  Or, not safe enough to be true?

 

Is it a fool's paradise to want low(est) prices, without inviting/accepting any risk?

I don't think Mattel should be singled out and flagellated.

 

It's not because the said toys were manufactured in China.  It's not because the workers are Chinese.  It could happen in any market where there is tremendous pressure to absolutely minimize (the cost of) all factors of production.

 

I know, we can't all afford to shop at Williams Sonoma and Whole Foods.  That's the other extreme.

 

But there is surely a middle ground: fair wages for workers; ethical, safe production practices; transparency into compliance; and, of course, slightly higher prices to pay for all of this.

 

Or, the alternative – the fool's paradise – the status quo – more product recalls – more sick people – more scapegoats.

 

What do you think?

The so-called tech sector is buzzing these days with M&A activity.  A lot of it is driven by convergence: bigger 'A' acquires smaller 'B' to roll the latter's capabilities into the former...

 

Interesting article in BusinessWeek about blogs and podcasts (engagement, challenges, limitations).  Here are my thoughts…

 

Podcasts:

·         many broadcasters using mobile devices, versus uploading via studio or home gear

·         podcasts do not facilitate scansion – at best, you might be able to search keywords or tags, but otherwise, an hour's podcasts takes a long time to find a nugget of gold you might be looking for.  But it suffices to say, search sucks; it just ain't easy.

à wouldn't you like to search your favourite podcast, by keyword or phrase, especially if it was transcribed and Web-enabled, automatically?

 

Blogs:

·         it's easier to scan and search blogs than podcasts.  But they're not as portable – obviously you need a screen or a hard copy.  Audiobooks have been with us since the cassette tape (70s) – right now, it should be easier to download an audio copy of your favourite blog (if Steve Rubel sounds like Barbara Walters, I'll modify my preferences).

·         Web services will become available, and blogs will soon have "podcast" or similar capabilities.

 

Clearly, podcasts moving to text, and blogs moving to audio, introduce complementary but somewhat distinct audiences to each other's content.  Result: more readers or listeners; more opportunity for dialogue.

 

This kind of convergence can only be a plus.

 

(now when will Facebook incorporate a rich text editor for notes?  When will this lousy rich-text editor here become usable?  Or generate an .mp3 file of this tirade?...)

 

 

Well, I thought it was a prank.  "Damien Hirst unveils $100-million skull."  Yeah, right.  No *living* artist has ever unveiled a work of art for sale at $100-million.  Okay, I've been to my regular sites -- The Times, Reuters, BBC, just to check for a post-April 1 gag.  All I can say is, holy shit, the reports are true...

 

A tiny digression...

 

Contemporary art collectors are shelling out tens of millions of dollars for junk art.  I did an Art History minor.  I've studied post war and contemporary, and been to dozens of finest museums.  I've seen hanging many of the works illustrated in any Janson or Arneson course book.  15 years ago, I used to think a few million bucks for a Warhol, Rauschenberg, Johns, Artschwager or Cy Twomley – all contemporary artists very much in vogue – was a lot of money.  Now, so-called seminal works from many of them are selling for more than $50-million.  This is sheer lunacy.

 

Hold your breath and say "holy shit" five times.  Now, read below, and you'll say it five times more, I guarantee...

 

-- Mark Rothko -- White Center (Yellow, Pink and Lavender on Rose) (1950) -- $73 mil

-- Francis Bacon -- Study From Innocent X (1956) -- $53 mil

-- Basquiat -- a 1981 drawing -- $14.6 mil

-- Rauschenberg -- Photograph (1959) -- $10.7 mil

-- Wesselmann -- Smoker no. 17 (1975) -- $5.9 mil

 

 

I wish I was making this up -- but I'm not.  From Bloomberg: "Money has no meaning,'' said Angela Westwater of New York gallery Sperone Westwater, after the Rothko sold. "It's a good work, but the whole marketplace is crazy.''

 

What's next?  Smart money has to bet on Rothko, Warhol and Bacon.  The past few months have seen successive records beaten, so there is sustained momentum with these art brands.

 

David Geffen, a very wise collector, has flipped recently his key Warhol and Jasper Johns works.  He sees an overcooked market, and knows when to cash out (whether he wants to buy the LA Times is irrelevant).

 

But, I digress.  Back to Damien Hirst.  First we had Warhol, and a studio that turned out ready-for-t-shirt junk art.  In the 90s, Jeff Koons and the art school drop-outs he hired churned out more junk art -- works usually selling for around $250,000 a pop.  "Titian had studio assistants, too" or some other nonsense, he garbled, to edify his so-called art, and legitimize his (business) approach.  But Damien Hirst works sell for well over a million bucks, at retail... oops that sounds rather bourgeoisie... I meant to say, when he unveils them.

 

And now, a Hirst just consigned for auction has a high estimate of $8 mil.  Like Warhol and Koons, Hirst is a junk artist laughing all the way to the bank.  His net worth is a scandalous quarter billion dollars.  That's right, more than $250,000,000 USD!!! (source: Reuters).  Again, holy shit!  He's richer than most (of the media demonized) hedge fund managers.

 

Breaking from the standard $1-million works, Hirst is now displaying a diamond-encrusted skull.  First $100 million takes it.  There's a pic at the bottom.

 

Mom and dad dropped me too many times as a baby.  I should have become an artist with Warhol or Hirst like machinations.  Or, used student loan money to buy every bottle of DRC La Tâche or Romanée-Conti I could afford...

It's the worst kept secret.  No. Britney is not an alien… of course, I'm talking about the HD-DVD crack.  The code that allows for unauthorized copying of discs.

 

Truth is, the secret has been "out" for months – since February of 2007.

 

Social networking sites – like digg – were among the first where content creators published the code, or links to the code.  Links made the first page of digg – a clear sign of interest and popularity.

 

It's amusing that the consortium called Advanced Access Content System Licensing Administrator (AACS), which is backed by companies like IBM, Intel, Microsoft and Sony, and movie studios like Disney and Warner Brothers, actually thinks they can keep a lid on the code getting out.

 

Old media still doesn't get it.  Ten years ago, a "cease and desist" letter would scare most anyone shitless.  Content would be removed; the story would fade like a sunset; and the lawyers would go out for stiff martinis.  Not any more.  Independent of digg refusing to remove links to the code (props to digg), it's childishly easily to find: just enter a search query on Google with the words HD-DVD and crack, or code, and there are hundreds of links in the results set.

 

Old media should know this: once content is published, it's republished, repurposed, reposted, and shared – exponentially.

 

Once a message is disseminated, it's shared – almost always via the underground, grassroots e-communities like digg, at first.  Then, major media outlets pick up the story and amplify it for a more traditional audience – the kind that has content pushed passively to it.  Check out today's New York Times article for more details – and a link to the code, should you be interested. :)

 

We're into secondary and tertiary rounds of content creation.  The code has been posted, naked, for months, for anyone looking for it.  Now, new creators are adding a layer of comedy, publishing videos of the code to a song (think of the Bob Dylan documentary, "Don't Look Back," in which he tosses large cue cards with words) or merely tapping a rhythm to the letters and numbers.  Consider this ditty on YouTube.  When I watched the video earlier today – a guy strumming a guitar, monotonously repeating the code – it had 89,000 views.  Now, there are more than 137,000.

 

Earth to old media: the more you try to make it difficult for honest people to make legitimate copies of material they've purchased, the more pirates will try to hack and embarrass you.

 

Oh yeah, "cease and desist" letters don't work any more – not online, at least.

According to the Wall Street Journal, ITV is about to roll out a "live streaming of all its television channels, a 30-day "catch-up" television service and access to a program archive stretching back to the 1950s."

 

Let's take a look at streaming of full-length programming on the three major US broadcaster Web sites…

 

• NBC offers streaming of some shows, but not all, of its programming.  For the shows that are available, "all full-length episodes are posted by 5am ET the day after they air. Episodes are available for a limited time only," according to the NBC site.  There is some level of IP detection, since I can't access the programming ("We're sorry, but the clip you selected isn't available from your location.  Please select another clip.").  In any case, NBC is missing the point – people want access in real time, when the show airs – and later down the road.  NBC business approach is fundamentally flawed; users want content on demand, not when the network dictates they can have access to it.
• ABC offers a wider range of programming.  The site limits viewing online to the geographic US, but doesn't hold back from publishing ads for US brands or offers (e.g. Target.com) to Canadians.  Smart move – slap with one hand; take ad dollars from the other.  Classic media slight of hand.
• CBS offered by far the best experience online.  Not only could I not access full length programming ("not available outside the US"), I got to enjoy an endless loop of Advil and Verizon ads.  You know the brand is getting the bill for the "stream."  Why can't the networks act ethically and suppress advertising for visitors outside of the target market?  I guess that would be asking for too much.

ABC and CBS "get it," but only a little – certainly more so than NBC.

But all the major networks are completely out to lunch by not enabling the back catalogue.

 

As a lead marketer for Columbia House, I learned very well about some distinct user segments.  Their motivations and behaviours are markedly different.  DVD buyers are product-centric – they want to own DVDs.  It doesn't matter that the DVD might get watched three times, and the cost to rent could be $12 versus a $22 purchase.  It's a moot point.  DVD buyers are driven by commodity ownership.

Then, there's the on-demand segment – give me my programming, when I want it.  I don't want to own a DVD to perpetuity; I just want to watch content when I want to, how often I want.

 

The latter group's needs set is not being addressed by any of the major US broadcasters.

 

ITV gets it – and understands that in enabling access to content going back to the 1950s, is a wise business decision, and engages people further with the ITV site, and brand.  Access to the content can be supported with ads.  As NBC learned recently when it attempted to charge for commercial-free content, people balked.

 

It is only a matter of time before the US based major networks avail more of their "vault" online, as streaming video.  ITV's likely success, and the activity on Torrent networks for back catalog, will only serve as further evidence that the current business approach is shortsighted.

(WSJ article --> http://online.wsj.com/article/SB117802957764488158.html)

The "AMG Challenge" is coming up. If you're not a car geek, AMG macks out Mercedes-Benz vehicles (suspension, brakes, engine, rims -- all performance related; M-B acquired AMG several years ago). It's been suggested to me that AMG's GMs (gross margins) are north of 20 points. Yikes!  But I digress...

Personally, the thought of driving up to 300 kph terrifies me, and thrills me. I got the greatest feeling about a month ago in Zion national park. I was on a ledge with a 1/3-mile vertical drop. It was wicked. I actually leaned over the edge -- my centre of mass was definitely out there. Talk about a death wish. I want that same kind of rush, and I'd also like to drive sh**-hot cars that cost well over $100K and have 500+ HP. It's a one-day event, and I'm almost ready to pull the trigger (metaphoric foreboding, I hope not). Details are here --> www.mbevents.com (code 33216M)

Yikes.  I'm speaking at a conference.  Me, a subject mater expert?  Two media outlets (The Globe and Mail, Canadian Business) and one major research firm (the Aberdeen Group) quoted me recently, so booyakasha, dat be me! :)

 

No, it's not about which 2001 Barolos are best buys, nor whether the hype around 2005 ..:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />Bordeaux and Burgundy is worth it (it is, in certain contexts)… nor is it what I think about modern electronic music…

 

I'm speaking at Webcom (http://www.webcom-toronto.com/programmation.php?j=3) on social media, and how new tools are empowering organizations and getting results – meaning, how companies can be honest and transparent when communicating with customers and potential customers on blogs, communities and forums.  It's never been a better time to be a marketer, because the more straightforward you are about a product, service or experience that offers honest value, the more receptive participants are to talk about you online in a positive context.

 

I'll blog in the days to come about what, more specifically, the presentation will cover… buy your ticket today (that wasn't a marketing message, of course)…

 

http://technorati.com/claim/swdp6sxqx" rel="me">Technorati Profile

Seems another respected journal (Moneysense) thinks I'm a subject matter expert (aka "SME") on wine; specifically, Bordeaux futures.  I'd hope so.  I could have owned a large chunk of a condo by now, but no, I've put my money in plonk… and not even enjoyed it like, say, Dylan Thomas. :)

 

I have respect for Moneysense simply because it gave me more coverage than the Globe and Mail earlier this year (http://www.theglobeandmail.com/servlet/Page/document/v5/content/subscribe?user_URL=http://www.theglobeandmail.com%2Fservlet%2Fstory%2FLAC.20060506.WINE06%2FTPStory%2F%3Fquery%3D%2522fine%2Bwine%2Breserve%2522&ord=10980480&brand=theglobeandmail&redirect_reason=2&denial_reasons=1589261%3A4%3B&force_login=false).  That's reason enough. *eg*

 

The Moneysense article appears here (http://www.canadianbusiness.com/my_money/spending/article.jsp?content=20061212_114410_4388) and because of personal vanity, I've also pasted it below.

 

Buy now, drink later

Pamela Young
From the December/January 2007 issue of MoneySense magazine

If you are passionate about wine, well-supplied with cash, and very, very patient, now may be the right time to stock up on Château Ausone 2005. Ordering this blue-chip Bordeaux on the "futures" market while it is still aging in the barrel will set you back $1,395 a bottle, or $16,740 a case. Of course, you won't be able to collect this robust yet ethereal red at your local liquor store until 2008 — at which point you really should let it mature in a climate-controlled cellar for at least a dozen years before taking your first sip.

 

Why would any sane person plunk down thousands of dollars for something they won't taste until at least 2020? In many cases, it's because buyers figure they'll never have a chance to sample the most highly prized wines in the world unless they buy early. Demand for the most revered names in viniculture, especially the famed first and second growths of Bordeaux, has soared in recent years, thanks in large part to an influx of newly rich buyers from China and India. Competition for the best of the best is now both fierce and frenetic. In the spring of 2006, when the world's top critics tasted the 2005 Bordeaux vintage en primeur, or while still in the barrel, and proclaimed it an exceptionally good year, prices skyrocketed. While you could have bought a bottle of good but not great Ausone 2004 on the futures market for $395, the futures price for the stellar '05 vintage leaped a thousand dollars higher.

 

The irony is that the wine futures market began as a way for budget-conscious tipplers to save money. Growing and aging wine ties up capital for years, so wineries have traditionally been willing to give customers a discount if they pay up front, a couple of years before the wine is bottled and shipped. Sometimes the wine turns out to be worth more on the open market when it's released than the price that futures buyers paid. When that happens, the lucky holders of the futures can choose to either take delivery of the wine or sell it back to the agent at a profit, prior to shipping.

 

Problem is, you can't count on making a profit. While Bordeaux vintages during most of the 1990s yielded handsome profits for those who bought futures, the 1997 crop disappointed. Some buyers of futures in that year wound up paying more for their wine than they would have if they waited and bought their bottles when the vintage was released.

Rather than paying the price of a small car for a case of Ausone 2005, you may want to tiptoe gingerly into the world of wine futures by first trying your luck with more modestly priced Bordeaux labels, which go for as little as $35 a bottle. If you live in Ontario, you can place a futures order for as few as three bottles through the Liquor Control Board of Ontario (LCBO), although in other provinces, especially if you order through a wine club, you're looking at buying at least a half a case — six bottles — and more likely a full case.

Darcy Kelley, an e-business strategist who sits on the board of the Toronto Vintners Club, has dabbled in both the high and low ends of the market. He bought a selection of 1995 Bordeaux second-growth futures for investment purposes 10 years ago. He stores those bottles — and others that he may someday choose to sell at auction — in climate-controlled security at Toronto's Fine Wine Reserve. Kelley estimates that if he sells those wines five or 10 years from now, they will fetch at least three to four times the price he paid for them.

Kelley, though, isn't tempted to repeat his 1995 success by investing in the status-label 2005s, which he thinks are already fully valued. Instead, he confined his 2005 buys to what he calls "drinkers" — wines purchased for his own consumption, at $35 to $55 a bottle, that he will store at home in a refrigerated cellar unit. Kelley's 2005 picks, based on past experience and the critics' en primeur reviews, were d'Angludet ($39), Dauzac ($52) and La Bienfaisance ($36). He is particularly looking forward to the d'Angludet, which Decanter magazine's Steven Spurrier described as a dark, dense, herbaceous offering, redolent of wild violets.

Other experts also believe that you can find the best value in 2005 futures by shopping among moderately priced Bordeaux. Shari Mogk-Edwards, director of sales and purchasing for Vintages, the LCBO's fine wine and premium spirits division, points out that many of the most revered châteaux, including Latour and Margaux, put out second wines priced at a fraction of their flagship offerings. In a year like '05, she says, "from a pure taste perspective the value in the second labels is very, very great."

One good way to find out about promising wine futures is to hang out with other wine lovers. Graeme Harris, a communications executive with a financial services company in Toronto, belongs to the Opimian Society, a national non-profit wine-ordering cooperative with 15,600 active members in chapters across Canada. He was thrilled when his very first futures buy, three cases of Château Cantemerle 1995, was worth so much upon release that he was able to cover about 80% of the cost of the one case he kept by optioning to sell the other two back to the sales agent. But turning a profit isn't Harris's main objective when he buys wine. "Ultimately, wine is like art," he says. "It's something you want to enjoy, not something you're trying to make a fast buck out of."

Best Bets
We've seen these futures — and they work.

We asked Natalie MacLean, one of Canada's top wine writers (NatalieMaclean.com), and wine enthusiasts Darcy Kelley (DK) and Graeme Harris (GH) to choose their top picks in 2005 Bordeaux futures. Prices are per bottle, as quoted by the Liquor Control Board of Ontario. Initials beside each choice indicate who made the pick:

Under $50

La Tour Carnet, $49 (NM)
d'Angludet, $39 (DK)
La Croix de Gay, $46 (GH)

$50 to $200

Kirwan, $79 (NM)
Certan de May, $105 (DK)
Nenin, $99 (GH)

$200 to $500

Palmer, $385 (NM)
Cos d'Estournel, $299 (DK & GH)

$500+

Margaux, $995 (NM)
Haut-Brion, $750 (DK)
Pétrus, $1,295 (GH)