Archive for the ‘innovation’ category

Ally Needs to Ally with a Better Advertising Strategy

August 3rd, 2009

Have you seen the series of TV commercials in which an adult uses “fine print” to tease a child? In one, one girl is given a toy pony and then watches as a playmate is given a real pony; in another, a boy is allowed to play with a cool toy airplane for a few seconds, only to have it abruptly taken away and replaced by a sorry cardboard cut-out. These acts of meanness are supposed to be metaphors for how financial services companies use “fine print” to abuse their consumers. Clever, huh?

If you have seen these spots, do you remember who the advertiser is?  I highly doubt it.  The answer is Ally, which on its website bills itself as “a new bank built on the foundation of GMAC Financial Services.”  When I read this, I had a true LOL moment, having used this blog on numerous occasions to criticize General Motors for its automobile and truck advertising. The Ally campaign certainly rivals GM’s vehicle advertising for incompetence.  First, it commits advertising’s cardinal sin by failing to register the brand name–an especially flagrant foul given that this is a new company that badly needs to establish consumer awareness. Second, the story line of the commercials has virtually nothing to do with financial services; the viewer comes away with little or no understanding of what benefit is being promised. Third, the teasing of these children is downright mean; although this meanness is ostensibly meant to represent the way Ally’s competitors treat their customers, it seems more likely that Ally will be the brand associated with the meanness. It almost makes you wish for at disclaimer saying, “No child’s emotions were irreparably harmed during the filming of this commercial.”

In short, these commercials don’t effectively convey either the benefit being advertised or the brand doing the advertising, and those few viewers who are somehow able to identify the brand will likely associate it with meanness.

For a company claiming to know that consumers don’t read the fine print, you’d think that Ally would have the good sense to put its benefits–and its name–in the headline, rather than to associate itself with the teasing of innocent children. What consumers would want to ally with a company like that?

Amazon Not Afraid to Play with Fire

April 27th, 2009

Amazon recently announced financial results that virtually any company would die for, and it’s hardly a surprise. This is a company that possesses not only a crystal clear vision but an exceptional ability to execute. But for all the well-deserved praise they’ve received over the years for being the world’s most innovative online retailer, I don’t think they’re receiving all the praise they deserve for their bold launch of the highly innovative Kindle and Kindle 2 wireless reading devices.

I don’t own a Kindle (yet), and I realize that it has its critics, but I also know a lot of people who are head-over-heels in love with their Kindle. One of the most impressive aspects of the Kindle story is the fact that Amazon didn’t wait until the products were perfect before launching them. Rather, they gave it their best shot, introduced it to the market, listened to user feedback, and acted on it. As a result, the Kindle 2 represents dramatic advances over its predecessor, and I have no doubt that the same will be true of the Kindle 3.

It takes a lot of audacity to launch a product as technologically challenging as a wireless reading device, especially when you make a good part of your living selling paper-based books. Amazon, however, clearly realized that sooner or later someone would launch such a product, and it’s far better to cannibalize yourself than to let someone else eat away at your market share. Moreover, given the deep insights Amazon has into into its customer base, I suspect that they felt the Kindle would increase overall book readership rather than merely cannibalize paper-based book sales.  And from some of the reports I’ve read, it appears that Amazon was right.

While I doubt that I would have come up with “Kindle” had I been given the naming assignment for this innovative new product (given that the name is associated primarily with igniting fires and bearing offspring), I think the name works quite well. It has a pleasant, comfortable feeling to it, and congers up images of cozying up to a warm fire with a good book. Or maybe even a good wireless reading device.

Sony: Like Every Other

April 17th, 2009

A headline in yesterday’s Wall Street Journal read, “At Sony, Culture Shift Yields a Low-Cost Video Camera.” In essence, Sony has decided to launch a low-cost camcorder to compete with the Flip camcorder, which was launched three years ago. Sony’s product, called the Webbie, not only has no meaningful competitive advantage over the Flip, it has two major disadvantages: it’s available in only 3 colors, versus hundreds for the Flip, and it cannot be personalized with the customer’s own images.

This announcement is yet further confirmation of just how far Sony has fallen from the days when it was considered not only the most innovative electronics company in the world, but a brand that warranted a significant price premium. Back then, the tagline “Sony. The one and only.” was both memorable and truthful. Unfortunately for Sony fans–and investors–the company decided about 20 years ago to get into the movie business. As so often happens with dramatic diversification moves like this, the company soon lost focus, and its vaunted innovation soon disappeared. Think about it: what’s the last big idea Sony brought to the market? The Walkman? (Speaking of which, when’s the last time you used a Walkman, let alone bought one?)

Around the time it was losing its capability for innovation, Sony also lost its penchant for marketing, opting to replace the catchy and ownable “Sony. The one and only.” with the utterly forgettable “Sony. Like no other.” Sadly, Sony now seems content to act like every other consumer electronics company by simply knocking off the market leader and competing on price. What’s worse, it clearly hasn’t even mastered the art of knock-offs, as its new entry is an inferior product…and a few years late. That’s not great news for Sony customers, and it’s worse news for Sony investors.