So I am assuming you’ve heard the news, everybody is talking, writing, tweeting about it. Not it’s not about Facebook’s latest update but it seems that Netflix has made another bold move.
After increasing the price of its DVD and streaming side by 60%, it has decided to split its famed DVD rental and streaming business. That’s right, the days when you could order the red envelope and stream one of the movies may be behind us. That is of course if you are not one of the many customers, who was so appalled with the price hike that you cut ties and instead moved to a competitor. I did and now I get superfast shipping and many TV serials and movies online from one provider, Amazon. Continue reading →
I remember first reading about the concept of money in history class and the transition from the barter system to coins to paper money. It all seemed very exciting and that was also when I first shocked my parents by asking for pocket-money. The latter wasn’t very well received. So reading about Jack Dorsey‘s startup Square sparked a number of questions in my mind.
Square essentially wants to replace cash registers, wallets and loyalty cards with mobile apps and a smartphone. As I see it the need is to reduce the hassle of carrying your wallet, particularly plastics everywhere you go, the benefit is a lighter freer and possibly more spendthrift customer (i.e. you). At the moment the software can be loaded on to an iPad.
As long as the customer has Square’s mobile app, the merchant can complete transactions with absolutely no plastic. Square stores payment details in the app, and by sharing your name when checking out, the transaction is processed and you get a text-message confirmation. Neat huh.
But this is not exactly a new concept, just a modifications on whats already in play in the Far East. Japan has long been phasing out the hassle of coins and bills with microchip-laden “smart cards,” which let people make electronic payments for everything from lunch to the daily commute. Other nations, led by South Korea, already have mobile commerce payment schemes in place that let people punch keys on their cell phones so that the devices trigger transactions. According to a Mastercard study, there is a possibility the technology is likely to be accepted in the US. Of Americans who use mobile phones, 63% of those aged between 18-34 years are open to using their device to make purchases. But there is a sizable chunk of the population who are wary of the technology. So its important to gain the buy-in of the remainder and show its efficacy.
Square, as the article suggests, is likely to face significant competition from the big guns, namely Visa and Mastercard. These players have spent decades building the vendor relations and scale necessary for the operation and that is a clear strategic advantage that is hard to replicate by new entrants. However, by nabbing Visa as a strategic investor, I think Square has bought itself some time. Visa, Google and Mastercard are also getting on the act.
Here is a video introducing Google Wallet and retailers perspective.
Square also seems to be focusing on smaller businesses, and this is a hot market to focus on. Especially if it can find a way to partner with players such as Foursquare, GroupOn and Living Social.
On a macro level, we need to consider how this is likely to impact the economy as a whole. In the long run, US consumers need to reign in their spending, yes it will do a lot to circulate money but I wonder if adopted on a large-scale how this would impact the US.
But enough with the gloom. On a brighter note, the day we start using virtual wallets, enjoy intergalactic flights and teleport between locations is possibly not that far. Ahh Gene Roddenberry would be so proud.
Social networking sites present an increasingly attractive way for companies to establish direct contact with a proportion of their customer base, market themselves, and build brand awareness. This post analyses four social networking sites – Facebook, Twitter, My Space, and LinkedIn – and discuss their potential as a marketing tool.
Facebook (FB) – With more than 500 million active users, and 550,000,000 estimated unique monthly visitors in May 2011. FB is the largest social networking site in the world. According to statistics released by the company, half of its active users log in on any given day, spend over 700 billion minutes per month on Facebook and connect to 80 community pages, groups and events.
FB also caters to a range of demographics including 18-24, and over 55, indicating the potential to use FB as a marketing tool. Companies or fans can create a product or brand specific page, and users can sign-up with the click of a button. Some of the elements that can be integrated on the page include engaging fans/members using regular updates and polls, posting pictures, designing special applications, featuring new product/brand and receiving feedback, running contests and giving out coupons, answering questions via the discussion forum, and by posting pictures and videos. FB users can also send each other gifts featuring a company’s product and/or brand prominently on their own page and these shows up in their status updates. Given the diversity of applications, there are few barriers for companies to leverage the site irrespective of industry. The key is to keep the fan base interested and involved, with continued activity on the profile, ensure a distinct, coherent, and consistent message, and not force the conversation in any one direction.
Twitter – Twitter is a ‘micro-blogging’ site. It is now the second most popular social networking site and had 95,800,000 estimated unique monthly visitors in May 2011. As compared to other sites such as FB and MySpace, some feel Twitter lacks dynamism, but there are benefits to this medium. Twitter is a good method to track the popularity of a company’s brand or product and stay part of the conversation. Zappos was the first company to use a Twitter aggregator that pulls in all mentions of the company on a page created on its site. This is also a way to promote the brand, people mentioning the brand, and display their experience. Twitter is also a good place to interact with customers, provide regular news, provide customer service, highlight offers, and provide new product information. In order to capitalize on Twitter, company representatives should establish a twitter account and begin to post regular updates on the site. It is also necessary to post engaging material to increase interaction with followers. Companies can track their followers, gain insight into their behavior. When using Twitter it is important to be responsive to tweets.
MySpace – The third most popular social networking site, had 80,500,000 estimated unique monthly visitors in May 2011 . The site is skewed towards a younger demographic, and focuses on music and video content. Aquafina uses its profile to provide customers with entertainment and supports the independent film community – its profile features short film and it provides film festival updates, and had 8732 friends as of May 20,2011. By focusing on this targeted community, Aquafina has been able to generate intense brand loyalty and word of mouth. However, MySpace might not suitable for every business, and has up until recently seen a drop in popularity. In order to tap the site, it would be necessary to find an interest community such as musicians, gamers, filmmakers, or photographers and find a way to interact with them and build a loyal fan base. It is important to ensure minimal clutter on the MySpace page, as that is a common issue with the site, and acts as a distracting element.
LinkedIn – The fourth most popular social networking site, LinkedIn had 50,000,000 estimated unique monthly visitors in May 2011. As compared to the other sites critiqued in this paper, marketing opportunities for companies using LinkedIn is slightly limited. The site is primarily used by professionals for recruitment, business development, and relationship development/networking purposes. All Fortune 500 companies have a profile on the site and represented by a variety of employees ranging from the CEOs to junior staff. The site is best suited for small businesses, which can use the “Full View” option to promote their organizations. Google prominently displays LinkedIn in searches and this can be very beneficial for small businesses, allowing interested parties to view a company’s profile. LinkedIn provides the ability to connect with sites such as the company’s blog, twitter account, and display company presentations.
My perspective: Social networks provide companies with an interactive forum and depending on the marketing strategy, a host of social networking sites can be used to spread the company’s message. It is good practice to have a consistent message, and link various sites to the company’s home page and among each other to direct fans/users to content. Establishing guidelines is another very important task, and employees assigned to the task need to approach aspects such as posting comments, and links in a consistent manner.