Communities Dominate Brands

Death of the blockbuster

From Loic's blog a reference to a big piece on the death of the blockbuster by Chris Anderson of the Long Tail via Boing Boing

Cory Doctorow on Boing Boing: "On The Long Tail blog, Chris has posted a great, crunchy, stats-rich piece on the death of the Hollywood blockbuster. According to Chris's research, the proportion of Hollywood's money coming from blockbusters is falling, while the cost of making blockbusters is up, and the number of people going to blockbusters is falling. It doesn't take a psychic to see that this means trouble for Hollywood, which has been mainlining $200MM box-office turds for half a decade now. [T]he fraction of total box office that comes from the blockbusters (top 25 films) has been steadily falling, even as the cost of making those films (expressed here as a percentage of total box office revenue) has been rising. Bottom line: even in Hollywood, the home of the blockbuster, hits are losing their power. It's not nearly as dire as in music, but it's trending in the same direction. Does this mean the end of movies? Not at all--there have never been more films made, just as there has never been more music available than today, despite the fact that the bestsellers sell less.

It's not that people aren't watching films and listening to music, it's that they're watching different films and different music--we're just not following the herd to the same hits the way we used to. I'd guess that most of the decline in box office is due to the rise of the DVD, not a loss of interest in movies. Likewise for music, where the ubiquitous white earbuds suggest that music has never been a bigger part of our culture, despite the fact that CD sales are back to mid-90s levels."

Thanks to Jackie Danicki for the hat tip

Community collaboration - design hotel room?

We are passionate promoters of community collaboration. It is new, and we are eagerly tracking the examples that come to our attention, such as the Boeing Design Team we write about in our book, Communities Dominate Brands.

I was just in Singapore on business, and stayed at a hotel called the Gallery Hotel. Its a rather funky artistic hotel with a lot of personality. I've now stayed at the hotel twice in the past two months, and even after many nights, my hotel room and the various details of the hotel continue to amaze and surprise me, totally in a positive way, and as a very distinct contrast to the rather stale environments of the SAS Radissons and Sheratons and Holiday Inns of the world.

I was just about checking out of the hotel yesterday, when one of the hotel managers walked by with some reporters. She was telling them that the hotel room were designed by hotel guests. They had invited submissions, open to anyone, not only architects, and then guests were asked to vote on what the guests liked most, and the three best designs were then implemented.

As she was obviously in the middle of a PR pitch to the press, I did not try to interrupt. But this is first of all a wonderful idea. How many times have YOU been in a hotel, thinking, if I had designed this room, what I'd have done is moved the light switch here, or put a power outlet closer, or whatever.. Here is a hotel that has gone one step further. And truly engaged its customers.

I have a contact, and will dig up some more, to find out exactly how it happened. But at least conceptually, this is exactly what we mean, and fits perfectly with Alan's thought, "Nobody is as clever as everybody." Excellent job, Gallery Hotel Singapore - and if you do need a bed in Singapore, check it out, very reasonably priced hotel but you will be amazed, that it is a memorable hotel.

Hope for print media, from? Music industry?

Alan and I have written in our book, and frequently blogged about all the threats to the traditional print media. Certainly the readers find ever more of their news and entertainment online, spend more time in more immersive media like videogaming, and become ever more interactive in their media consumption. Free print models are spreading producing price pressure on the cover price, while advertisers are also moving with the eyeballs to more digital media. What is worst, is that all these trends are most pronounced within the youth, meaning it will automatically keep getting worse as the current youth grows older and brings its interactive media habits into adulthood.

By all accounts this sounds like a very bad prognonsis for the print industry.

But some encouragement is now coming from a very unanticipated direction. EMI the music giant's CEO and Chairman, Alain Levy wrote at length on 8 February in the Financial Times about how the music industry is coming to terms with the digitally converging world. He cites examples like the pop band Gorillaz, whose latest song, Feel Good Inc, had sold 2.2 milloin copies - but only 450,000 of those were sold on physical media, ie on CD. 1.75 million of the songs were sold in digital formats - that's 80% of their total sales - ranging from anything from iTunes sales, to direct sales of MP3 tracks to mobile phones, to music streaming and subscription services, to ringback (waiting tone) sales etc. The biggest sales of digital were, as could be expected, ring tones which accounted for over half a million of the sales of Feel Good Inc.

Mr Levy says that in 2000 his industry was in total disarray and all were full of gloom and doom. But today they have learned to live in the digital world and more importantly found ways to make money in it. He concludes with a surprisingly upbeat thought, "It may have been tough at first, but the digital revolution will become the best thing that ever happened to this business."

Quote of the day

Consumer is an industrial-age word, a broadcast-age word. It implies that we are all tied to our chairs, head back, eating ‘content’ and crapping cash.

According to Doc Searls

Via engagementalliance

Not Just Another Column About Blogging

Inflamatory stuff from Jack Schafer in What newspaper history says about newspaper future.

I'm not about to predict what the collapsing cost of media creation will ultimately do to the news business, if only because my track record at prophesy is terrible. But this much I know: The newspaper guild (again, reporters, editors, publishers) can't compete by adding a few blogs here, blogging up coverage over there, and setting up "comment" sections. If newspapers, magazines, and broadcasters don't produce spectacular news coverage no blogger can match, they have no right to survive.

But instead of improving their product by deploying technology bloggers can't afford (yet), newspapers are devolving. Many are cutting staff. Daily newspapers are growing smaller and uglier, with no paper looking anywhere near as lovely as Joseph Pulitzer's New York World from the late 1800s.

Telco's sad siren song. except at France Telecom

Doc Searls posts an interesting piece quoting Norman Lewis director of research at France Telecom transcribed by telephonydiscussion

This is the quote Doc pulls out

I think that voice and innovation around voice has been very bloody awful. For the past 100-150 years I think telcos have throttled innovation around voice and voice has essentially been the same experience for the past 150 years and we have that possibility of taking that application [voice] and liberating it [voice] from that kind of stranglehold that I think telcos have had in the past and now we can begin to do things we have never done before. If you just look at the recent period with Ebay-Skype...voice is becoming something of an adjunct to other services and will open up new possibilities...I see this as a huge golden opportunity for immense innovation...What we [the telcos] are doing is re-arranging the deck chairs on the titanic. That is essentially what a lot of us are doing in our companies. The innovation landscape has changed.

We [France Telecom] are the leaders in providing voice over IP and both France and in the UK, this is Wanadoo in the UK. We are one of the biggest providers in the UK of voice over IP today. Us, not BT, Us. In France the same thing. We¹ve introduced some incredible pricing and packaging etcetera etcetera. Of course the real problem is you can get people to buy into the service but to get them to use it, is another question. And that is where this whole discussion comes a full circle. Because the way we are going to get people to use it, is by building compelling applications that embed voice, in other things that people are doing. And that is where I really want to talk about the future by having this capability and more importantly understanding where we need to go in the future in terms of the sweet spot between providing that kind of infrastructure, providing that kind of capability with the ability to innovate that exists at the grass roots, that is where I think we need to come together and start working together and start building the next generation of applications that go far beyond the trivia that we see, ringtones show stupid are people, you get a whole song for 99 cents why would people pay three pounds fifty [6.23USD] for 30 seconds of a song?

I am sure Tomi has something to say on this

Doc sums up by saying

What a nice break from the likes of Edward Whitacre and John Thorne.

It takes a long time it seems to change your mindset of working in a monopoly to thinking like a challenger brand

The end of TV as we know it: A future industry perspective

I picked this up via Peter Bates mentions a report recently published by IBM The end of TV as we know it: A future industry perspective

Peter says; cccording to a recent report the broadcasting industry is confronting unparalleled complexity, dynamic change and is under pressure to innovate. The authors consider that the market evolution hinges on two key market drivers: openness of access channels and levels of consumer involvement with media. For the next 5-7 years, there will be change on both fronts – but not uniformly.

The industry instead will be stamped by consumer bimodality, a coexistence of two types of users with disparate channel requirements. While one consumer segment remains passive in the living room, the other will force radical change in business models in a search for anytime, anywhere content through multiple channels.

The tech- and fashion-forward consumer segment will lead us to a world of platform-agnostic content, fluid mobility of media experiences, individualized pricing schemes and an end to the traditional concept of release windows.

The report considers that these behavioural differences that will lead to the "Generational Chasm" between the passive mass audience ("Massive Passives") and leading-edge users (divided into two sub-groups: "Gadgetiers" and "Kool Kids").

Given the influence of both segments in the 2012 forecast period, the authors consider that strategists must today work amid fragmentation, divergence and opposition in the market: to optimize across nascent and long-standing business models; across new and traditional release windows; with old and new content programmers; and with both IP and traditional supply chains.

This is the beginning of "the end of television as we know it" and the future will only favour those who prepare today. IBM offers six executive recommendations to get started:

Segment : Invest in divergent strategies and supply chains for bimodal consumer types. Identify, develop and continually refine data-driven user profiles in order to optimize product and service development, distribution, marketing messaging, and service migration. Tailor content, advertising, pricing and reach dynamically.

Innovate: Innovate business and pricing models by creating – not resisting – wider consumer choice with windows, bundles, pricing and distribution. Take risks today to avoid losing position long-term.

Experiment: Develop, trial, refine, roll-out. Repeat. Conduct ongoing market experiments alone and with partners to study "real life" consumer preferences. Invest in new measurement systems and metrics for the on demand world of tomorrow.

Mobilize: Create seamless content mobility for users that require on-the-go experiences. Ensure easy synchronization across devices and without user intervention.

Open: Drive open content delivery platforms to optimize content and revenue exploitation, and to create optimum business flexibility and network cost-efficiency. Position open capabilities to bolster digital content protection with consumer flexibility, and for plug-and-play business upgrades necessary in the fast-changing marketplace.

Re-organize: Assess business assets against future requirements. Identify core competencies needed for future competitive advantage. Isolate non-core business components for outsourcing or partnership. From an external perspective, reconfigure business to exploit market and financial levers to buy, build or team to future competitiveness.

Peter comments - This report is broadly in line with what with what we have been saying. However, creating new opportunities for aggregating content around communities of interest by those providing these new TV experiences could stimulate a more rapid up-take from users.

But what amazes me is that the marketing community on both sides of the fence still seems to be driving the car still looking in the rear-view mirror. Is it the DNA? There are some many more opportunities, revenue streams, ways to engage, deliver more value in this most fluid of worlds.

We want to curate our own consumption in increasingly sophisticated ways.

Whether it be Jeff Jarvis writing on his blog the last of the presses or Bob Garfield describing the chaos scenario of a post mass media world , Doc Searls or Dan Gilmour writing about how the internet changes everything, Rupert Murdoch describing himself as a digital immigrant and then buying myspace.com The reality is our digital world is growing and evolving around us, changing us, releasing us, connecting us.

Nielsen study highlights growing power of online communities

The power of online communities is growing rapidly, according to new research, which highlights why traditional media firms such as News Corporation and ITV are snapping up community websites.

According to Nielsen NetRatings PDF almost 1.8bn web pages are viewed each month in member community sites, which represents more than 57m pages every day.

Online communities have been around since the early days of the internet, but their stock has never been higher as multimillion-dollar deals are struck to snap up such businesses.

Nielsen//NetRatings says that member community sites now attract over half of the UK internet population every month. In the UK, Friends Reunited is the most popular member community with more than 1.8m visitors each month.

It is numbers like this that helped convinced ITV to pay £120m for Friends Reunited and an additional £55m, if performance targets are hit by 2009.

Likewise, News Corporation paid a whopping $580m for US community website MySpace.com.

Myspace, while a bigger community brand in the US, is ranked fourth in Nielsen//NetRatings after Google's blog service Blogger and college community site Bebo . Other sites in the top 10 are Ancestry.co.uk and Genes Reunited.

Alex Burmaster, European internet analyst at Nielsen//NetRatings, said the popularity of social networking and community sites in the UK are growing day by day, particularly among the young.

"While most of the talk about the future of the web revolves around which of the giant media companies will win the battle to enable people to watch TV through the internet, a revolution of more immediate substance is already under way.

"Sites such as MySpace, Bebo and MSN Spaces dominate those most likely to be visited by the teenage market. The future of online to the young is about what the internet is best at -- communicating and interacting -- not watching TV," he said.

Of all the sites visited by the UK internet population, Faceparty has the highest number of pages viewed per person -- more than the pages viewed per person for Google, eBay and the BBC combined.

Burmaster added that member communities are the most popular brands in the UK when looked at it in terms of the average number of web pages viewed per visitor.

For example, the average Faceparty visitor views 23 pages within that site every day, giving an idea how deeply ingrained the member community experience is in the lives of today's online population.

Stormhoek: The Podcast

Stormhoek: The Podcast

Is a fascinating glimpse into some marketing innovation Jason Korman of stormhoek is in conversation with Johnnie Moore and James Cherkoff

These are some points that Jason makes in the interview.

The challenge with wine is to break through the clutter in an industry with lots of products from all over the world. To have an impact we have to have A) great product and B) sometinbg interesting to say. Blogging helps to do that... an enormous opportunity.. and it's very cost-efficient. It's hard to think of a way of marketing that would be less expensive.

We've had a lot of trade press recently. It tends to focus on the free samples to bloggers but they misunderstand what we're trying to do. It's like going into a bar and buying someone a drink. You do it not to give them a free drink, but to start a conversation. All we've done is use our product as a way to start conversations with people. That's what marketing today is about: conversations with people. We're lucky to have a product that is a social lubricant.

Fugees MP3 to mobile phones - no longer pre-release, now test marketing

Today's USA Today told of the Fugees - the American soul/urban music band - who have released three new tracks as MP3 songs on Verizon's network.

Nothing new about that. For five years already we have seen pop artists release ringing tones first to mobile phones before the same songs were released on other formats; and since 2003 we have seen artists release full-track MP3 songs to mobile phones before they are released on music CD's or other formats.

But this is a radical new step. The Fugees said that these three songs are NOT being pre-released, from an upcoming music CD. They are just new songs, and their first sales outlet is the mobile phone. As of now, the Fugees have no plans to release those songs in any other formats !!!

They may show up in an upcoming CD or maybe on i-Tunes and other MP3 sales channels, etc. But not necessarily. The Fugees have estimated their fan base and the penetration of mobile phones, and have targetted to hit a million sales with one of the three - which in America is equivalent to being a platinum seller. Except that on mobile phone sales, the band makes much more per track than they would on any other formats.

Expect this pattern to repeat in many ways. Not only that the mobile phone is used to pre-release content like previews of TV soap operas and videogames - but actually to test-market content. We are likely to see more innovators exploring this in the near future.

Watch this space...