ImaginativePRO Blog

VAIL RESORTS' LOCATION-BASED SOCIAL NETWORK USES AN RFID CHECK-IN SYSTEM TO TRACK YOU ON THE SLOPES

One of the interesting emerging trends in social media is the rise of geo-targeted social networks focused on specific neighborhoods or locales -- which I will refer to as place-based social networks, until someone comes up with a better name. This week brought the unveiling of an innovative new place-based social network for skiers visiting slopes in Colorado and California, called EpicMix, which puts a new spin on the whole check-in.

EpicMix is a proprietary social network operated by Vail Resorts (NYSE:MTN), which uses radio frequency identification (RFID) chips embedded in ski lift passes to track the movements of skiers (who opt in) over the slopes of five different resorts owned by the company -- Breckenridge, Beaver Creek, Keystone and Vail resorts in Colorado, and Heavenly in California. Sponsored by Pepsi and Bud Light, the free Web-based, mobile-compatible network allows participants to share records of their ski trips in the form of maps depicting which trails they've skied, compiled via automatic RFID check-ins at 89 ski lifts around the five resorts. Another feature lets users see how many vertical feet they've skied in total.

What is the new EpicMix? from Vail Resorts on Vimeo.

Taking a page from Gowalla and Foursquare, skiers can earn commemorative, collectible digital pins by, say, being the first or last skier on the mountain, visiting two mountains on the same day, or riding three lifts at night. A Facebook tie-in lets users take their friendly competitions to the social network on EpicMix-branded Facebook "leader boards." Another tie-in alerts them when their Facebook friends are on the slopes, and allows them to send private messages to these friends to arrange meet-ups. They can also access snow and weather reports, trail and grooming information, traffic conditions, and other relevant information for Vail Resorts. Last but not least, users can also post status updates and share stats on Twitter via EpicMix.

Heavenly Ski Resort - Lake Tahoe, California

EpicMix also includes a service for children under the age of 14, who can participate via their parents' accounts; it features unique content and special pins for young skiers, as well as extra security provisions. Parents can use this site to track their kids' movement around the slopes.

Breckenridge Ski Resort - Vail, Colorado

Members can use smartphones to log in to their EpicMix profiles and avail themselves of the various services, but you don't have to own a smartphone to participate; you can just opt-in for the RFID check-ins and then log in to your profile later to relive your days on the slopes (you can also opt-out any time). The social network is set to debut November 5 -- opening day at the Keystone resort. According to Vail Resort execs, the potential user numbers up to 800,000 patrons; in 2009 the company said its resorts host a total 5.9 million skier visits (including a number of repeat visits) equal to about 10.3% of all U.S. skier visits that year.

COMMENTARY: � This could be a great way to locate a skier if they forget their cell phone and get lost or injured on the slopes. �Bingo. �EpicMix tells Vail Resorts search team where you are located. �This is great for parents who wonder where their kids are, and vice-versa. � I wonder if it counts how many times you fall. �

Courtesy of an article dated August 31, 2010 appearing in MediaPost Publications The Social Graf � ��

CMO MATRIX: HOW TO INTEGRATE SOCIAL AND TRADITIONAL MEDIA -- A HORIZONTAL APPROACH

CMOs must approach social technologies in an integration fashion
Although social technologies have been capturing marketers time for over four+ years in corporate, they’ve often been operated in a silo as experimental, or a separate deployment from traditional marketing. Yet the savvy marketing leader knows that reaching customers is increasingly becoming challenging as their touchpoints continue to fragment.

To reach the fragmented customer, marketers must apply an integrated approach.  As an industry, we should dispel notions that social marketing and it’s subsequent tools should operate in a silo, but instead sit horizontally in the marketing organization as they impact so many different forms of marketing tactics, approaches, and mindsets.  Furthermore, this has considerable impacts as social media organizations are founded and lead as they approach hub and spoke models to serve a variety of internal clients, as well as connect with customers in real time.

Different forms of social media technology. Click HERE to enlarge the above image

 

The Online Social Media Channel Matrix

CMO Matrix: How Social Technology Must Integrate with Traditional Marketing, a Horizontal Approach

Integrating Traditional Media with Social Media Technology - By Media Type

• Market Research	-		You can’t effectively reach consumers till you know about them, and market research is a key function for any corporation.  For some time, market research was limited to focus groups, consumer testing, and survey based methodology. This includes both traditional marketing research groups as well as competitive intelligence groups.		Now, with the advent of social technologies, at least three forms of opportunity have emerged:  1) Using brand monitoring technology to harvest what consumers are already saying in social channels, 2) Harnessing the crowd to find out their real time reactions, see how Communispace and Passenger have done this.  3) Using innovation tools like Salesforce Ideas, UserVoice, GetSatisfaction to build products in real time with consumers.

• Corporate Website	-		The corporate website is a source of product factual information, and pro-brand materials.  This is the master repository of a brand, it’s products, and services.		Social technologies are being integrated in three phases: 1) Standalone tools like communities are built, but not integrated, 2) Social login systems like FB connect and Open ID are increasing conversion rates 3) Social context is being developed so content is served up on the fly from social data. See my keynote at Gilbane’s CMS conference on social and corporate website integration.

• Intranet		Marketing - Must influence internal stakeholders, including sales, field marketing, and product teams.  The intranet is a key internal repository of information, this would also include any associated email communications.		Social technologies are being deployed internally like PBWorks, Socialcast, Basecamp, and Yammer without the consent of IT. The opportunity to use these tools to allow teams to find experts, information regardless of region or time are ripe.

• Email Marketing

  -

  Email, one of the primary forms of digital communication is often a highly trusted source when customers have opt-in.  When you look closely, email is a social network, see how Google wants to do it. In fact, the root information requirement for Twitter and Facebook is a verified email.

  Email marketing companies are starting to offer ’sharing’ features so recipients are encouraged to quickly share the information with their peers, as well as offering brands SMMS systems to manage this information.  Expect the Facebook inbox and email marketing to quickly merge in coming years.

• Search Marketing	-		A mature practice that attracts buyers and prospects during their core information seeking phase, SEM is critical to reaching the information starved through well placed sponsored information and advertisements		We’re also seeing an influx of social advertisements appear as the social graph is infused in search results. Example: We’re starting to see the content our friends recommend in search engine results, and Facebook’s foray with social ads.

• Search Engine Optimization -			Fine tuning websites so they are the first choice in organic search results is both a science and art by experienced practitioners.		Social media tools, esp blogs and ratings and review sites like Yelp score high in organic search due to many incoming links and freshly updated content.

• Advertising	-		Often the bulk of most marketing budgets, advertising is key in many phases of the customer journey, in particular driving awareness and consideration.		Like SEM listed above, advertising can become more efficient in the future by tapping into social profile data (who is this person) and their social graph (who do they trust) to serve up relevant content.  As Facebook spreads their features all over the web (analysis), expect a new form of advertising to appear based on social data.  Twitter’s “Sponsored Links” bodes similar experimentation

• Sponsorship	-		Marketers drive associative branding and qualified leads through sponsorship opportunities.		Social helps in two specific ways:  New influencers have emerged such as ‘Mom and Dad bloggers” creating more niched inventory with deeper engagement to sponsor.  Furthermore, all traditional sponsorship activities can use social marketing for further engagement.

• eCommerce	-		While over a decade old, online shopping has continued to be primary low cost driver for the brick and mortar company.		The mainstay integration has been consumer ratings and reviews from the aggregation of the crowd, often powered by vendors like Bazzarvoice.  Yet expect new forms of eCommerce to evolve as an individuals social graph is connected to eCommerce tools. See how Levi’s has done it, and attend our conference, the Rise of Social Commerce.

• Mobile Marketing	-		While in it’s infancy, marketers may use these tools to connect with consumers as they are on a specific location, during a certain part of the day, with greater context.		Now, as consumers indicate their location and time while on the go, marketers may reach them using a variety of contextual information, advertisements, and harnessing what their friends have done before them in the same locations.  Seehow Starbucks sponsored mayorship in Foursquare to increase both loyalty and WOM.

• TV/Radio	-		The pioneering mediums in the electronic communication realm, these mediums provide content in a one way format.		Programs (radio hosts, newscasters, and stations) are using social technologies to infuse a two way relationship with listeners by finding new content in social channels (Watching Twitter) as well as integrating the voices of the audience, and empowering communities to build around them.  Perhaps more importantly, this creates new forms of inventory for these mediums to enable brands to sponsor or get involved with.

• Print	-		From newspapers, magazines, to flyers, nothing creates an experience like holding physical paper in front of you.		Nearly all of these publications have associated social media properties, from Facebook fan pages, to supplementary blogs.  In fact, if paper adoption continues to decrease, these social tools provide a low-cost method of publishing and interacting with their audiences.  Magazines like Dwell have launched thriving online communities and nearly all national and many global newspapers have adopted social media in their online resources.

• Field, Persona, Channel, and Regional Marketing	-		Marketing teams are often segmented by regions, or to sit with sales units in the field, or even to target specific consumer types, like moms. This segmented marketing approach is key for deeper context in approaching unique markets.		Like in other forms, don’t expect a one-size-fits all approach, each audience type will have a different penchant for social media technologies, which we call socialgraphics. Expect a tailored approach using social technologies to emerge for each of these groups as you reach different audiences.

Executive Recommendations: Shatter the silo and integrate social across all marketing efforts now. The above matrix demonstrates that social technologies are already being integrated in the overall mix, yet marketing leadership is at a standstill on how to integrate.  Approach the space in a pragmatic method, follow these three steps:

• Start by organizing your company in a Hub and Spoke, Dandelion, or Centralized model.  Our research shows that companies are organizing in at least five different models.  Whether you have a centralized team or a hub and spoke, develop a way for an internal team to assemble (often cross-functional) to share and learn, then serve internal stakeholders.  Companies must know the 43+ points to get social business ready, watch our no-cost webinar and slides to learn more.
• Cascade training and encourage sharing to reduce risk and decrease time to market.Social technologies are still new and come with high degrees of risk as brands continue to have misteps in a new form of marketing.  Yet to reduce risk, empower those that have already experimented to share with others, reward those that quickly fail and get back up, and provide a constant stream of training from external partners.
• Require marketing plans to consider a social technology integration –not be a last minute addition. Marketers are not in the mindset of combining social technologies in existing events, campaigns, or traditional marketing.  Instead of being reactive and adding this as a last minute consideration, enforce a line item in marketing plans to include social integration up front.

COMMENTARY:  An excellent compilation of how traditional media benefits from integration with social media  to create "boost" and buzz. 

Courtesy of an article dated August 30, 2010 appearing in Web Strategy by Jeremiah Owyang blog

PEW REPORT: AMERICANS 50 AND OVER DOUBLE SOCIAL MEDIA PRESENCE

"That's my Facebook homepage, we can uploads pictures and videos of our grand kids. What's a wall?"

While social media use has grown dramatically across all age groups, older users have been especially enthusiastic over the past year about embracing new networking tools. Social networking use among internet users ages 50 and older nearly doubled—from 22% in April 2009 to 42% in May 2010.

• Between April 2009 and May 2010, social networking use among internet users ages 50-64 grew by 88%--from 25% to 47%.
• During the same period, use among those ages 65 and older grew 100%--from 13% to 26%.
• By comparison, social networking use among users ages 18-29 grew by 13%—from 76% to 86%.

“Young adults continue to be the heaviest users of social media, but their growth pales in comparison with recent gains made by older users,” explains Mary Madden, Senior Research Specialist and author of the report. “Email is still the primary way that older users maintain contact with friends, families and colleagues, but many older users now rely on social network platforms to help manage their daily communications.”

• One in five (20%) online adults ages 50-64 say they use social networking sites on a typical day, up from 10% one year ago.
• Among adults ages 65 and older, 13% log on to social networking sites on a typical day, compared with just 4% who did so in 2009.

At the same time, the use of status update services like Twitter has also grown—particularly among those ages 50-64. One in ten internet users ages 50 and older now say they use Twitter or another service to share updates about themselves or see updates about others.

COMMENTARY:  I knew the numbers of older Americans flocking to online social networks like Facebook had increased, but doubling is quite impressive.  No wonder the younguns are starting to bailout and slowly migrate to other social networking sites like Foursquare, Ogwalla and MySpace.  

To view or download a copy of the Pew report "Older Adults and Social Media" click HERE.

If you don't know this already, there is a social networking site called EONS.com which is for Baby Boomer's.  I am a member, have been since 2005, but I much prefer Twitter.  My second choice is LinkedIn, followed by Facebook.   

Courtesy of an article dated August 27, 2010 appearing in Pew Internet

I/O VENTURES HOLDS FIRST WIE SYMPOSIUM FOR WOMEN TECHNOLOGY ENTREPRENEURS

i/o ventures, founded in January 2010, is a San Francisco startup incubator and mentor similar to  Y-Combinator.  I/O Ventures has partnered up with Arianna Huffington, Donna Karan and Sarah Brown to put together the first Women In Engineering Prize, and will announce the winner at the 1st WIE Symposium on September 20, 2010.

I/O Ventures mentors and provides a small amount of seed capital to founders of technology startups to help them develop, launch  and commercialize their product or service    I/O Ventures works closely with the entrepreneurs to develop sustainable and scalable business models, improve execution and accelerate time-to-market. Entrepreneurs chosen by I/O undergo four months of mentorship and given an opportunity to pitch investor's at I/O Ventures' Demo.  I/O Ventures cafe and incubator is located at 780 Valencia and 19th Street in San Francisco's Mission district. Their new facilities offers a relaxed and casual environment for mentors and entrepreneurs to meet and exchange ideas. 

I/O Ventures cafe incubator located at 780 Valencia St and 19th Streets in San Francisco's Mission district under construction in January 2010

Paul Bragiel at I/O Ventures cafe and incubator still under construction

Layout of I/O Ventures cafe and incubator facilities and seating areas located in San Francisco's Mission District 

I/O Ventures team includes Aber Whitcomb, former CTO and co-founder of MySpace; Ashwin Navin, former President and co-founder of BitTorrent and a veteran of Yahoo's corporate development team; Jim Young, CEO and CTO and co-founder of HotorNot.com, a web service for users of Linux, MySQL and PHP at large scale; Paul Bragiel, a co-founder of Lefora, a product used in operating forums, and co-founded Meetro, the first location-based social network. 

The deadline for hopeful female founders to apply is Sept 10th, and the lucky and hard working winner will receive 25k in investment, become part of the i/o program, get free office space for a month as well as a trip to New York to attend the conference. i/o’s Paul Bragiel and Ashwin Navin initially put the award together because they noticed a lack of women applying for incubator funding at i/o, and was wondering if this was possibly because women lacked clear cut mentors in Silicon Valley. This wasn’t unique to i/o either. Bragiel said, “I’ve talked to various other incubators and there were very few females there, so we figured we’d market directly to women and make it clear that there were opportunities specifically for them.”  

The WIE award will target young female startup founders looking for exposure and access to the i/o incubator, which mentors founders from product launch through the next stage of company development, sharing what has proven to work for product scaling, revenue growth and fund raising. Bragiel holds that the competition and prize are the first of their kind, “The goal in our collaboration is to help more companies founded by women get exposure they need to the best investors and mentors both in the valley and world wide.” Female entrepreneurs should also consider this an open call to go mentor at i/o. Aspiring WIE Prize winners can apply here. 

COMMENTARY:  I don't know how I/O Ventures escaped me, but they launched right after the Holiday's and it probably fell through the cracks, coming right after all those NCAA football championship games.  There simply are not enough startup incubators or mentor's.  Y-Combinator gets most of the press, so it is refreshing to read about I/O Ventures.  

This post comes a bit late, but very timely, as I recently posted an article about the lack of female founders of technology startups.  I/O's WIE Symposium is a great opportunity for women with technical and engineering backgrounds to showcase their entrepreneurial talents and startup ideas, and win an opportunity to participate in the I/O mentorship program, receive some seed capital and launch their new startups.

I just reviewed the WIE Symposium program and in addition to Arianna Huffington, Donna Karan and Sarah Brown (Wife of Gordon Brown, U.K. prime minister), there is quite a list of other impressive female speakers including Gina Bianchini (co-founder NING), Tamara Mellong (co-founder Jimmy Choo Shoes), Katarina Fake (founder of Flickr), Dee Dee Myers (White House press secretary) and many other accomplished women.  

Tickets for the WIE Symposium range from $200 to $500 depending on the number events attended.  My major beef about the WIE Symposium is that it is being held in The Big Apple.  I was thinking that a more appropriate location should've been Silicon Valley, the technology Mecca.  

The WIE Symposium winner receives $25,000  in seed capital and has an opportunity to be mentored by Kim Polese, former CEO SpikeSource, Inc., co-founder of Marimba and served as a Java product manager at Sun Microsystems for seven years; Chris Shipley, analyst, entrepreneur and CEO, Guidewire Group, Inc.; Theresa Gouw Ranzetta, Accel Partners, who headed investments for numerous technology startups; and Sukhinder Singh Cassidy, CEO, Polyvore and former Accel Partners CEO-in-residence.

Courtesy of an article dated August 11, 2010 appearing in NonStopTechNews 

THE PROBLEM OF WHY THERE ARE SO FEW FEMALE HEADS OF TECHNOLOGY STARTUPS

Female technology executives increasingly are banding together to solve what they say is a problem in their own midst: a dearth of women in top positions at emerging tech firms.

Only about 11% of U.S. firms with venture-capital backing in 2009 had current or former female CEOs or female founders, according to data from Dow Jones VentureSource. The prestigious start-up incubator Y Combinator has had just 14 female founders among the 208 firms it has funded.

 

 

Female business owners by industry according to University of Phoenix

The “where-are-all-the-women” meme is a familiar one, and not confined to the technology world. But in start-up land, where the good idea is supposed to trump social status and everything else, the lack of women in positions of authority stands out. There is no shortage of opinions about the cause, but regardless, some techie women are – in true start-up fashion – attacking the problem with meetups, money and social networking.

Top female CEO's according to the Fortune 500 for 2009

2009 executive pay among female's by field according to Forbes Magazine

Start-up executive Dina Kaplan and Gilt Groupe CEO Susan Lyne and the Paley Center for Media CEO Pat Mitchell run a group – which they call the “Breakfast Club” — of young and established tech and digital media executives who meet for professional networking, social support and swapping practical advice about running young digital companies. Start-up incubator i/o Ventures this month teamed up with Arianna Huffington, designer Donna Karan and former U.K. first lady Sarah Brown to launch a $25,000 competition for the “next female tech trailblazing entrepreneur.” This December for the first time, the influential technology conference TED is holding a women-focused conference.

“Part of the reason to form the group is to form true friendships and connections that could lead to business opportunities…but also to create pretty hardcore camaraderie,” said Ms. Kaplan, co-founder of online-television network blip.tv.

These women-power efforts aren’t without controversy. “I personally do not participate in any female tech organizations because they make more harm than good sometimes, because they [segregate] women,” said Yuli Ziv, founder of Style Coalition, a network of fashion and lifestyle digital publications. Instead, Ms. Ziv said she tries to encourage women to integrate more forcefully into male-dominated tech events such as the New York Tech Meetup.

“In our generation and in our community, I don’t believe there’s any issue or any disadvantage to women,” Ms. Ziv said. “I don’t think we have any excuses.”

The announcement of TEDWomen last month also sparked a flurry of Twitter posts and blog screeds questioning whether it is a step backward for gender equity to funnel women into a separate and perhaps unequal TED conference. Supporters say TEDWomen is an effort to focus on a topical subject of interest to men and women, and not an attempt to cobble together a TED B-team.

Rachel Sklar, the writer and Mediaite founding editor, said the women-focused conferences shouldn’t be controversial, and she said the TEDWomen event was no different than other TED functions focused on locales like India and Los Angeles. She recently co-founded a group called “Change the Ratio” to shine a light on women in entrepreneurial roles, and to address the dearth of women at start-ups.

“Part of changing the ratio is just changing awareness, so that the next time Techcrunch is planning a Techcrunch Disrupt, they won’t be able to not see the overwhelming maleness of it,” said Ms. Sklar, referring to the influential tech conference.

Technology investors Fred Wilson and John Borthwick said the industry needs catalysts to spark a virtuous circle of more successful women-led tech start-ups leading to more women in tech start-ups.

“From successes come role models and from the role models come change,” said Union Square Ventures’ Mr. Wilson, who recently called for more diversity in the start-up world.

Mr. Wilson, who said 3% of investment pitches he fields are from women, said he has become more attentive about the challenges of women tech entrepreneurs. He said he seeks to write about successful women entrepreneurs and prod conference hosts to include women on panels. “Little things like that will make a big difference,” he said.

COMMENTARY:  I could be wrong about this, but there are several reasons why there are so few CEO's in tech startups:

• Female's in general have a problem breaking through the male-dominated glass ceiling and reaching the position of CEO. According to CFO Magazine, only about 5% of Fortune 500 firms are female.  
• There is a shortage of females with engineering and technical education and experience.  I would have to check into this, but most of the individuals with technical backgrounds are males.  I just don't find a lot of females in biosciences, green technology, medical devices, software, social media and other hot industry spaces.
• Female's are less likely to start a technology startup than male's. About 95% of my clients are male. Where the heck are the females.  

These are my personal observations.  I could be wrong, or maybe I am just full of male machismo, but I am willing to take the flack, if you think I am wrong.  I welcome your comments.

Courtesy of an article dated August 27, 2010 appearing in The Wall Street Journal's Venture Capital Dispatch

LOCATION-BASED SOCIAL NETWORKS FACE MANY CHALLENGES ON THEIR WAY TO ADOPTABILITY

"Hi Zuck, how did you know where I am and what I am doing?"

MARKETING, its veterans like to say, is all about the “three Rs”: reaching the right person in the right place at the right time. Hence the growing interest in marketing circles for mobile-phone-based social networks such as Foursquare and Gowalla that let users “check in” to shops or restaurants and instantly tell their friends where they are. Fans of such services gush that they will mint money by allowing ads to be targeted at folk who are about to make a purchase. But the networks must negotiate some important hurdles first if such lofty predictions are to come true.

Location-based networking won an important convert recently in the shape of Facebook. For some time, the 800-pound gorilla of social networking had tracked the progress of firms such as Foursquare, which boasts some 3m members.  Facebook has entered the market with its own service, dubbed “Places”, which is currently available only to American users of its mobile application. Places lets them signal where they are to their friends on the network, in much the same way that they can “tag” themselves in photos.

Several advertisers have already run modest trials on location-based social networks. PepsiCo, a food and drinks giant, is delivering electronic badges to the mobile phones of people who repeatedly visit locations on Foursquare where its products are sold. Its initiative taps into the competitive spirit engendered by the fledgling service, which bestows the preposterous title of “mayor” on people who show up most often at a location.

Bonin Bough, PepsiCo’s global director of digital and social media, says the company’s initial experience has been encouraging. As well as persuading people to visit sites carrying PepsiCo products, the experiment with Foursquare has also given the firm useful data about, for example, foot traffic to stores, which it can use to tailor promotions. Ford and Starbucks have used location-based networks in a bid to lure in more customers.

There are several reasons why many marketers are still wary of committing big money to Foursquare and its like. 

• Few Members - One is that even the largest mobile social networks have just a few million members, which limits their appeal. According to a report published last month by Forrester, a research firm, only 4% of American adults have ever used such networks and far fewer do so more than once a week. Other forms of mobile marketing, such as SMS-based promotions and mobile-search ads, already reach far larger audiences.
• Fake Check-Ins - Another challenge facing location-based networks is to prevent tech-savvy individuals from gaming their systems. The blogosphere is littered with stories of “fake mayors” and other folk who have come up with ways of checking in to places they haven’t visited. Foursquare and other networks have been working hard to stamp out such shenanigans, but this is tricky. 
• Privacy Concerns - Then there is the thorny issue of privacy. If they are to grow significantly, mobile social networks will have to work overtime to convince potential users that sensitive information about their movements is being kept safe from, say, burglars.

None of this will deter marketers from launching more trials. “We’re still figuring out how best to use these networks,” says Jonathan Nelson, the head of Omnicom Digital, an advertising agency. In future, more of this experimentation will take place on Facebook, which boasts over 150m mobile users and so ought to be the one network capable of creating a massive, location-based service fast. But like its rivals, Facebook will still have to show that Places can deliver the most important “R” of all in marketing: results.

COMMENTARY:  Location-based social networks or LBSN's have a stigma associated with them.  I call this the "Big Brother Complex" or fear that advertiser's will be stalking them as they go about their business of visiting shopping malls, retail stores, movie theaters, restaurants and so forth.  Consumer's fear receiving endless SMS text messages from advertiser's plugging their brands and special promotions.  Female's are especially concerned about their privacy and being stalked.  Consumer's seriously must want to be GPS tracked, and I am not so sure most individuals want this.  

I think some brand's with well established brand loyalists like Apple, McDonald's, Starbucks, and so forth are likely to have better luck with their LBSN campaigns.  These are trusted brands, and their fans are more likely to be receptive to being GPS tracked, although it is anybody's guess how many consumer's will sign-up for LBSN GPS tracking.   

Foursquare, the largest of the LBSN's only has 4 million members, and a single brand is not going to want to use any LBSN unless the audience is there.  Facebook, with it's 500 million members and new Places check-in service, may stand a better chance over time.  It will be interesting to see where LBSN goes and evolves.

Courtesy of an article dated August 26, 2010 appearing in The Economist  

CLAIRE'S AND MACY'S TO CARRY "GLEE" TV SHOW INSPIRED FASHIONS, JEWELRY AND ACCESSORIES

A Gleek (fans of the TV show "Glee") invasion is coming to a mall near you.

Claire's retail chain, a haven for trendy high school girls, plans to roll out an exclusive line of jewelry, accessories and other merchandise based on Glee, the hit Fox musical dramedy, along with pop-up shops in three major cities and mall-based karaoke contests and viewing parties.

The marketer also will remake its logo for the first time in 40-plus years to include the hand sign for the letter L—as in, loser—that's part of the Glee title.

"Glee has the kind of dedicated fan base that's really rare," said Norm Yustin, Claire's global CMO. "Those fans are a great fit with the Claire's fan, and we wanted to share with them the fun and self-expression that's core to the show."

Another mall retailer, Macy's, has launched Glee-themed apparel to generate buzz and foot traffic for the key back-to-school selling season. The department store created a program that gives Glee mobile content to buyers of the hoodies, T-shirts and other types of clothing. Display windows hype the Glee boutiques-within-stores, and an extensive online campaign steers teens and tweens to the merchandise.

"Glee" TV show (Wednesday, 9:00 p.m. on Fox) cast members

Claire's pop-up stores launch Sept. 3 in malls in Chicago and suburban New York and Los Angeles, where charm bracelets with hunky characters Finn and Puck, makeup for cheerleader Quinn's flawless look, and Don't Stop Believing backpacks will be on sale. The locations will be decked out with lockers, a piano and other vestiges of McKinley High, where the fictional series is set.

Digital downloads for "Glee" season 2 - Nielsen

A week after the pop-ups open, Glee products will go into 1,500 Claire's stores, which will tout the connection to the Emmy-nominated show in all its front windows and through online campaigns.

"We were looking for a retail partner that not only fit the Glee demographic and could translate the show into product, but also would go above and beyond in co-marketing with us to create a real Glee event," said Pam Kunick-Cohen, svp at 20th Century Fox Consumer Products. "We think there's so much innovation in what Claire's is doing. They've just been extraordinarily creative."

"Glee" in the 2010 Emmy Opening Skit with Jimmy Fallen - YouTube video - This is hillarious�

Kunick-Cohen called it "unprecedented" for a retailer to redesign its own logo around an entertainment tie-in. "This is much more significant than just rolling out some Glee merchandise," she said.

Claire's has worked with Hollywood before, stepping up its involvement over the past year and a half with the feature films Fame and Alice in Wonderland. For the latter, the chain opened its first themed pop-up shop, in London earlier this year, and saw such success with it that executives were on the lookout for another potential hit. The partnership with Glee was tailor-made for the chain, Yustin said.

General Growth Properties, a third partner in the Fox/Claire's deal, will plaster Glee images around its malls and point fans to Claire's.

The monthlong promotion will feature an event stage in the Glendale Galleria just outside Hollywood, where there will be karaoke contests and fan activities. A viewing party for the second season premiere will take place on the mall's roof on Sept. 21. A national contest will send winners to that party, with VIP treatment. The marketer will be gathering video of the whole process, planning to release snippets of the behind-the-scenes story of the pop-up shops and fan reaction via its Web site.�

COMMENTARY: �I have to admit that I am definitely not in the Glee" demographics (predominantly teens), so I had to scurry and do some research. �I actually love the show. �"Vistages of my long lost youth." �A line I stolen from the film Wild Orchid with Mickey Rourke. �You can see images of the "Glee" cast members and view full-length video's of "Glee" TV episodes on the Fox website. �

Almost forgot. �"Glee" won two Emmy's. �Ryan Murphy for best directing in a comedy series and Jane Lynch for best supporting actress in a comedy series.

Courtesy of an article dated August 29, 2010 appearing in BrandWeek

WHAT GOES ON INSIDE THE BRAIN OF THE VENTURE CAPITALIST DURING YOUR PITCH

For entrepreneurs seeking venture capital, the pitch is everything.

Most investments in a start-up company, from the smallest “seed” financing that may be based on little more than an idea for a start-up, to a $50 million round for a profitable company preparing to go public, is preceded by an entrepreneur standing in a room explaining why venture capitalists should part with their money.

We asked Brian Jacobs, general partner with Emergence Capital Partners, a San Mateo, Calif.-based technology investor that is investing out of a $200 million fund raised in 2007, to take us behind the scenes of a typical company pitch and explain what goes through the mind of an investor as he’s watching and listening.

The slides below are a selection from an actual presentation made by Emergence Capital portfolio company InsideView Inc., a San Francisco-based company selling software that helps salespeople find new clients, improve existing relationships and close deals. The information is customized for each user and is provided through a Web-crawling search engine that finds and filters potentially important sales leads and information from in new social media sites and other emerging data sources. The presentation was shown to new investors, but eventually the company chose to accept the insiders’ investment proposal which resulted in an $11.5 million insider Series B financing in April from Emergence Capital, Rembrandt Venture Partners and Greenhouse Capital Partners. The company has now raised more than $25 million.

We interviewed Jacobs while looking at the slide presentation, which was similar to the one he saw that first spurred his firm to invest in the company. He took us into the mindset of a VC as he decides whether to, as Jacobs says, “give away millions to people we’ve just met.”

Slide #1: “Productivity Challenge: Information Overload”
Jacobs says: As I’m listening and watching to this, I have no idea what the company does yet, but they are describing a problem that makes sense. It used to be really hard for businesses to gather company and executive information – the only way to get it efficiently was to subscribe to traditional editorial databases, the so-called legacy data providers. Now, every day there are new sources of information becoming available and the problem is no longer how to get it but that there’s way too much of it. It’s now more about relevance and not just access.

At this point in the presentation, I’m attracted to the fact that this company is using a business-to-business model - it’s selling to small and medium-size businesses (SMB) and other companies, not individual consumers. That is where some of the best opportunities are, and I have a greater comfort that this company will get paid for its services.

Slide #2: “Productivity Solution: SalesView”
Jacobs says: Now I’m seeing that this is an automated technology that helps to solve the problem with software to identify the relevant information from all these new data sources that have sprung up, specifically information relevant to a salesperson. The software crawls the Web intelligently. If the customer is selling office furniture, the software will find companies that are opening or about to open new locations. If they are selling technology to enable mergers and acquisitions, the software will find companies that are buying other companies. All this happens through alerts that go to the salesperson and can integrate into other customer-relationship management software. I am starting realize they can uncover sales insights by pulling together relevant information in the same way that Bloomberg enables trading insights by aggregating relevant financial information.I can also now see that this company integrates data into CRM software from Salesforce.com, Oracle, Microsoft and NetSuite. Since Emergence Capital Partners was an investor in Salesforce, a lightbulb goes off in my head. We want to talk to our relationships at Salesforce and find out what they think about this company. We’re in the business of giving away millions of dollars to people we’ve just met. We really need to know everything we can about them.

Slide #3: “Smart Agents”
Jacobs says: Now we get to a screen shot of the actual product, which is essentially a compilation of all the information relevant to the salesperson that has been excavated from the Web that day. My first thought is that it doesn’t look like a very slick product. There’s a lot of text and it’s not very visual. I’m beginning to think, do people actually like this product? I’m reserving judgment though, because some products are cool-looking and no one uses it. If salespeople like this product, that’s all that matters.

Slide #4: “Customer Growth”
Jacob says: Now I have my answer: A lot of people like this product. I love this slide. It’s very visual and shows progressively that more and more businesses are using it. I’m thinking that these guys have accomplished something here. It’s not just a theory. In the list of customers, I’m also seeing names of companies we’ve invested in. So we’re going to talk to all of them and ask them what they think of the product.  At about this point, I’m asking myself a question that we ask each other all the time. The question is: Am I feeling greedy? In other words, is there something about this company that is provoking a visceral positive reaction within me about how successful this investment can be for us? If you’re not feeling that at all – if that temperature hasn’t risen enough - then I may not have the passion to convince my partners or to work with this company for the next five years.

Slide #5: “Progress Since Most Recent Financing”

Jacob says: This slide is simple and effective. The message of growth is reinforcing my growing feeling that this company is doing something right. At this point we assume all the data is accurate, but of course we will check it all out when we do our due diligence. I am also interested in the reference to free seats and paid seats. That tells me they have a free product and a paid product – what we call the “freemium” model (free and premium) - so I’m starting to understand how they are gaining users and how they are getting paid. I’m starting to understand their business model and their cost-efficient sales strategy.

Slide #6: “MRR-Cash Burn From Operations”
Jacobs says: This slide, which looks at monthly recurring revenue and cash burn shows me things are really moving in the right direction – they are not spending more money as they grow.At this point we might start thinking about valuation. A little posturing might occur in the first couple of meetings. Neither the potential investor nor the entrepreneur really wants to say upfront how much they think the company is worth, which will determine how big a stake we would get with our investment. Our ownership percentage determines how big our return is if the company goes public or is acquired. We want to know if they are talking to other investors and how much interest they already have, which helps us determine how much negotiating leverage we have.

If a company’s first presentation gets me wanting to invest, I have them come back and meet with my partners. Credibility and trust among partners is absolutely critical. I have to explain what I like about this company and convince my partners that this could be the next Google. But they are trying to convince me that they’ve found the next Facebook.

COMMENTARY:    My favorite comment is in slide #4 where Jacobs makes reference to "feeling greedy".  I remember one noted VC saying, "If I don't smell an IPO at the end of the line, I am not intereste."  Whee, tough people.  

My other favorite comment is in slide #6 where Jacob says "they are not spending more money as they grow."   I wonder if he understands the concept of an increasing returns business.  That's usually what you encounter in the software business. Margins increase even more with volume because the fixed costs of developing that software have been fully absorbed.  Cloud-based SaaS businesses offer even more: access 24/7 365 days, eliminates software administration and maintenance, and investment in software.  This is what is driving cloud-based computing, and VC's are eating it all up.   

In conclusion, my favorite anecdote:  "VC's want to see $100,000 in the cash register before they make an investment, then they worry if the money is counterfeit."   No disrespect intended, but since Jacobs brought up the issue of greed, enough said.

Courtesy of an article dated August 23, 2010 appearing in The Wall Street Journal's Venture Capital Dispatch

THE HIGH-TECH BICYCLE THAT WAS INSPIRED BY THE AK-47 MACHINE GUN

The AK-47, that fearsome weapon of mass destruction lugged by everyone from the Taliban and the Vietcong to Sylvester Stallone and Dianne Feinstein, is being put to use in an entirely new racket: bike design.

Yes, one plucky designer fresh from Savannah College of Art and Design, Bryan Walsh, has fired off a bike concept modeled after the ultra-durable construction and rugged looks of the 1947 Avtomat Kalashnikova, the world’s most popular -- and effective -- assault rifle. (It’s estimated to pulp a quarter of a million people a year.)

Walsh’s design won’t let you empty a few magazines on the RAV-4 crowding you in the bike lane. But it will last a long time. It’s powered by a hydrostatic drive (as opposed to a standard chain). And with its massive wood frame, we reckon you could still use it as a weapon. If you were so inclined.

Now, before you go and ring the design police (who most certainly do not carry AK-47s), consider this: There’s a reason the AK-47 would ignite the imagination of a young, self-described “Small Arms and Accessory Designer” from Beaufort, South Carolina. For all its grisly baggage, the AK-47 is actually a remarkable feat of weapons engineering. It was the brainchild of Mikhail Kalashnikov, a poet and a Soviet Army vet who, wounded at the bloody Battle of Bryansk in 1941, turned his hand to small arms design, vowing never again to let the Russian military suffer defeat. The result of his endeavors was a compact, relatively lightweight selective-fire rifle that could survive mud, sand, or snow and also happened to be obscenely easy to mass produce -- a sort of Model T for the munitions industry. Now more than 50 years old, it’s still widely manufactured alongside a pageant of AK descendants. Apparently, it can be bought in many countries for the cost of a chicken.

If you leave aside the ethics of engineering one of the world’s deadliest weapons -- even Kalashnikov has gone on record saying he wishes he had produced something less destructive, like a lawnmower -- there is little question that the rifle is a marvel of design, a perfect object for an imperfect world, as the blogger Dave Gray of XPLANE suggests.

The real AK-47 assault rifle. I still don't see the resemblance to the Avtomat Hydro-Static Bicycle 

That brings us back to Walsh and his Avtomat Hydro-Static Bicycle. The bicycle is powered by a Hydro-Static drive medium. It is designed to be sealed and reliable up to 20,000 hours. The frame of the bicycle is designed to out-last the rider and contains the fluid accumulator and cooling tank. The handle bars and pedals are designed to fold up since these two components take up the most room when storing in a dwelling. The bicycle has the capabilities of energy recovery in the form of braking and full front and rear suspension. This energy is stored in the high pressure tank and released when the rider goes from a static to a fluid motion.

We get why he drew inspiration from the AK-47. We don’t get why he drew inspiration for the AK-47 to design a bike -- and even on its own terms, the bike doesn't exactly scream "AK-47." The AK-47 is a symbol of rugged simplicity, but the actual principles of its design don't add any sort of value -- beyond sheer provocation -- to the bike. (On the Ed Ruscha continuum, this falls under the “Wow! Huh?” category.) Cement mixers are tough, but you wouldn’t design a bike after them. Then again, maybe Walsh has a bright future ahead of him in advertising and marketing? He certainly has a knack for flashy hooks.

COMMENTARY:  I like the cool design of the Automat Hydro-Static Bicycle, but am left wondering where the shifters, brake grips, brake calipers, front and rear chain rings are.  The handle bars are more designed like those for a mountain bike. I assume that the bike has fluid suspension, but how can this be adjusted for different terrain. The bike was obviously signed for its resemblance to the AK-47 and aesthetic looks, not practicality. Since the bike frame contains the "fluid accumulator and cooling tank, that would make the bike awfully heavy. Just the same, it would be cool to ride it just to attract the attention, and see who tries to steel it.  

Courtesy of an article dated August 27, 2010 appearing in Fast Company Design 

NETFLIX SOARS AS BLOCKBRUPTCY MAKES PLANS FOR ANTICIPATED BANKRUPTCY FILING

As if fights for survival, video-rental chain Blockbuster is preparing to file bankruptcy next month, according to a report in the Los Angeles Times.

Blockbuster executives met with the six largest Hollywood film studios recently to brief them about the company's plan, the Times reported. The move by Blockbuster, which closed down nearly 1,000 retail stores in the past year, appears designed to help the company get out of leases on perhaps as many as 800 underperforming stores, according to the report. The chain operates more than 3,400 stores.

Blockbuster reportedly plans to file something called a "pre-planned bankruptcy" and will continue to pay the studios and other most other major creditors. This development shouldn't surprise anyone. For years, Blockbuster has closed stores, laid off thousands, and generally been tumbling towards extinction. Driving to a video store to rent a movie is rapidly becoming as unnecessary as hiring a travel agent, developing film, or listening to music on compact discs.

A Blockbuster spokesperson was not immediately available for comment.

Mainstream consumers have opted for renting movies via rental kiosks such as Redbox, cable's video-on-demand, and especially Internet rental services--most specifically Netflix. Since 2008, the once industry-dominant Blockbuster has lost more than a $1 billion and Netflix has thrived.

The Los Gatos, Calif.-based Netflix will likely top 20 million subscribers next year and last year generated $115 million in net profit on $1.6 billion in revenue. Where once Netflix, with it's original business model of mailing little red DVD packages to customers, was a sort of a rogue element in the film distribution business, the public company has now won respect in Hollywood.

Netflix was once a source of far less revenue than Blockbuster or rival Movie Gallery, the No. 2 brick-and-mortar chain that has also filed for bankruptcy, but Netflix's CEO Reed Hastings was pesky in his ability to compete for customers. (The studios even tried to block Netflix from obtaining specific titles but the scrappy company always managed to find a backdoor way to get them.)

Now, Netflix's streaming video service is attracting the kind of audience and generating the kind of cash that's made film execs take notice.

This month, Netflix penned a five-year deal worth nearly $1 billion to stream movies from Paramount, Lionsgate, and MGM.

And digital distribution of movies and TV shows is barely in its infancy. Services such as Hulu, YouTube, and Boxee are still developing. Apple is reportedly working on some kind of new digital-video service perhaps tied to a new generation of Apple TV.

While we still have a long way to go, it doesn't look like brick-and-mortar video stores will be making the trip.

Netflix Q1 2010: 14 Million Subscribers & $493.7 Million Revenue

Netflix just announced Q1 2010 results and Netflix ended the first quarter of 2010 with 13,967,000 subscribers (98% paid), and $493.7 million in revenue. Highlights from the earnings release:

• 14 million subscribers. Q1 subscriber growth was 35% over 2009, and 14% over Q4 2009.
• $493.7 million in revenue, up 25% over 2009 and 11% over Q4.
• GAAP net income increased slightly to $32.3 million.
• Gross margin increased to 37.8% in Q1.
• Subscriber acquisition cost declined to $21.54, down from $25.23 in Q4.
• Churn was 3.8% in Q1, down slightly from Q4 2010.
• More than 55% of Netflix subscribers have streamed movies and TV shows.
• Bay Area household penetration increased to 24%, and 12% in the rest of the country.

 

Netflix is forecasting:

• 16.5 to 17.3 million subscribers in 2010, 14.7 to 15.0 million in Q2.
• $2.11 to $2.16 billion in revenue in 2010, $517 to $525 million in Q2.
• GAAP net income for 2010 of $132 to $144 million.

COMMENTARY:  Back in mid-2008, Blockbuster's CEO considered NetFlix not much of a competitor, although there were signs that NetFlix was building momentum with their DVD movie mailing service.  In 2009, they started their online movie streaming service.  A year later Blockbuster is on the ropes, in near bankruptcy, having closed nearly half of its U.S. stores.  I don't feel sorry for Blockbuster, when movie rentals started to go mainstream they put thousands of independent movie rental businesses out of business on their way to market dominance.  I remember the annual holiday season college football Blockbuster Bowl, Blockbuster blimps flying in the skies, and their movie rental late charges.  NetFlix has proven that their business model has staying power, and they are well positioned to compete in the movie streaming space, while Blockbuster may become, but a faint memory.

Courtesy of an article dated August 27, 2010 appearing in CNET  

Netflix just announced Q1 2010 results and Netflix ended the first quarter of 2010 with 13,967,000 subscribers (98% paid), and $493.7 million in revenue. Highlights from the earnings release:

• 14 million subscribers. Q1 subscriber growth was 35% over 2009, and 14% over Q4 2009.
• $493.7 million in revenue, up 25% over 2009 and 11% over Q4.
• GAAP net income increased slightly to $32.3 million.
• Gross margin increased to 37.8% in Q1.
• Subscriber acquisition cost declined to $21.54, down from $25.23 in Q4.
• Churn was 3.8% in Q1, down slightly from Q4 2010.
• More than 55% of Netflix subscribers have streamed movies and TV shows.
• Bay Area household penetration increased to 24%, and 12% in the rest of the country.

 

Netflix is forecasting:

• 16.5 to 17.3 million subscribers in 2010, 14.7 to 15.0 million in Q2.
• $2.11 to $2.16 billion in revenue in 2010, $517 to $525 million in Q2.
• GAAP net income for 2010 of $132 to $144 million.