Article 40: Yahoo Buys TV Chatting Technology

April 25, 2011      Source:  NY Times  

By VERNE G. KOPYTOFF

 

 

Friends inevitably dissect their favorite television shows when they are out together. When online, they often do much the same by posting messages on Facebook or Twitter.

Hoping to capitalize on television’s central role in TV chit chat, Yahoo said on Monday that it bought IntoNow, a mobile phone app that lets users tell friends what they are watching and discuss it. The idea is to create a social experience around television, even if a person is watching a show alone. Yahoo did not disclose the price for the company.

What sets IntoNow apart is its ability to automatically recognize shows. Users let the app listen to a show for a few seconds, and, in theory, it will determine the name of the program and the episode.

IntoNow has a vast database of shows over the last five years – the equivalent of 266 years of programming. The app can also detect new programs on 130 channels.

After the app recognizes “Desperate Housewives,” for instance, users can then share that information without having to type it in on their mobile phones. The same goes for news programs like CNN.

“Relying on social channels as a means for discovering content – whether it’s on a PC, mobile device or TV – is rapidly on the rise,” Bill Shaughnessy, senior vice president of product management and product marketing at Yahoo, said in a press release. “IntoNow’s technology combines the ability to check-in to what a consumer is watching, engage in conversations, and find related content.”

Yahoo said that the technology may be used across the Yahoo portal, including in video search and mobile. The app may also be useful in some way for advertisements, which users may want to share.

However, while IntoNow can detect national shows, it is less effective with local programming or live sporting events. The app is available only for iPhone, although the IntoNow team said in a blog post on Monday that the acquisition would help it with building apps for Android and iPad.

GetGlue and Miso are rival television check-in apps, although they do not have audio detection capabilities.

Yahoo’s track record with acquisitions is not exactly stellar. A number of the company’s acquisitions have either been shut down or failed to make much of a splash beyond the initial announcement, like Maven Networks, an online video platform that closed in 2009, and MyBlogLog, a service for blog owners that is set to close next month.

In financial funk, Yahoo is trying to revive its business and enhance its appeal to users who may otherwise spend more time on Facebook. Carol A. Bartz, Yahoo’s chief executive, has said, however, that her turnaround plan will take some time. She took over Yahoo two years ago.

Yahoo announced first quarter earnings last week that showed promising signs in the company’s main business — display advertising — but troubles in search.

 Someone chatting about the TV show using IntoNow. 

Class Tie-In

       This article and its content involves many terms we discussed such as: social media, business-to-business markets, and even product line extensions.  With Yahoo purchasing IntoNow this blended the two businesses into one goal: having more customers attracted to Yahoo.  With its new aquistion Yahoo hopes to have more of the general public searching and spending time on Yahoo.  With this new social media ploy, the company will certianly attract more people.  This give people an opportunity to achieve more utility while watching TV shows because they can talk to their friends about them through this product.  I mentioned product line extension because Yahoo is extending their product in new ways.  Typically, people use Yahoo for mail, search engines, or news articles, but now Yahoo is extending its product and brand to include social media. 

Article 39: Amazon seller lists book at $23,698,655.93 — plus shipping

By John D. Sutter, CNN

April 25, 2011

An independent seller apparently listed the book “The Making of a Fly” for more than $23 million last week.

STORY HIGHLIGHTS

• Amazon lists a biology book about flies for more than $23 million
• A robotic price war apparently caused the price spike
• Some Amazon sellers pay for algorithms that auto-update book prices

(CNN) — Lots of normal people would pay $23 for a book.

But $23.7 million (plus $3.99 shipping) for a scientific book about flies!?

This unthinkable sticker price for “The Making of a Fly” on Amazon.com was spotted on April 18 by Michael Eisen, an evolutionary biologist and blogger.

The market-blind book listing was not the result of uncontrollable demand for Peter Lawrence’s “classic work in developmental biology,” Eisen writes.

Instead, it appears it was sparked by a robot price war.

“What’s fascinating about all this is both the seemingly endless possibilities for both chaos and mischief,” writes Eisen, who works at the University of California at Berkeley and blogs at a site called “it is NOT junk.” “It seems impossible that we stumbled onto the only example of this kind of upward pricing spiral.”

Eisen watched the robot price war from April 8 to 18 and calculated that two booksellers were automatically adjusting their prices against each other.

One equation kept setting the price of the first book at 1.27059 times the price of the second book, according to Eisen’s analysis, which is posted in detail on his blog.

The other equation automatically set its price at 0.9983 times the price of the other book. So the prices of the two books escalated in tandem into the millions, with the second book always selling for slightly less than the first. (Not that that matters much when you’re selling a book about flies for millions of dollars).

The incident highlights a little-known fact about e-commerce sites such as Amazon: Often, people don’t create and update prices; computer algorithms do.

Individual booksellers on Amazon and other sites pay third-party companies for algorithm services that automatically update prices. Some of these computer programs purportedly work very well, getting sellers up to 60% more sales because they underbid the competition automatically and repeatedly.

The advantages are clear: If you’re managing dozens of sale items on Amazon or eBay, it’s difficult if not impossible to keep up with all of them.

“If you have more than 100 items, then it’s impossible for you to manually focus on the price,” said Victor Rosenman, CEO of a company called Feedvisor, which sells algorithm services to people who use Amazon.

“It’s pretty much like the stock exchange. What you see there is the prices changing all the time — but they never change drastically. Sometimes it’s a dollar here a dollar there — maybe $10. For a book, it probably would be pennies.”

These algorithms vary widely in quality, however, as the Amazon case shows.

Sellers easily can avoid the million-dollar-book situation if they set price ceilings and floors on their pricing algorithms, so that the competitive bidding shuts off at a certain dollar mark, Rosenman said.

“It’s like you put on the gas and didn’t have the handbrake,” he said. “This is a very basic mistake. So I am very, very surprised this thing happened at all.”

Some of these algorithm services give clients control over their equations, letting them edit them as they go. That doesn’t always work out well, Rosenman said.

His company handles all of this for clients, but charges a hefty fee, taking 1% to 5% of the seller’s profits and charging monthly fees of $500 to a few thousand dollars a month, depending on the size of the contract, he said.

Robot-adjusted prices may change a few times an hour or a few times a day, he said, depending on how competitive a price war becomes.

These algorithms try to detect if they’re working against other computers or humans and then they adjust strategy accordingly, he said.

They also take other factors into consideration, including how well the seller is rated by Amazon users. A seller with a great track record may be able to sell books for a slightly higher price because of his or her reputation.

Eisen, who first blogged about the overpriced book, writes that “alas, somebody ultimately noticed” the wild price of “The Making of a Fly.” On April 19, he says, the price of the book plummeted from more than $23 million to $106.23.

On Monday afternoon, the new book was listed at $976.98, and Eisen thinks the price is escalating again.

Neither Amazon nor either of the individual book sellers responded to requests for comment from CNN.

If nothing else, Eisen writes, the situation earned the fly-book’s author some bragging rights: “Peter Lawrence can now comfortably boast that one of the biggest and most respected companies on Earth valued his great book at $23,698,655.93 (plus $3.99 shipping).”

Class Tie-In

       This article was incredibly fascinating and it teaches anyone who reads it something about online marketing.  This relates greatly to our class because is discusses issues of price wars and how the price effects the demand.  This article also refers to the fact that competition drastically helps the consumer and it lowers prices.  People who sell on Amazon or Ebay or any other site want to have a reasonable price that consumers will pay for.  Little did I know, these sellers will hire a third party to help them price their products on the web.  These third parties are designed to have certain algorithms in place for pricing the product against its competition.  This is fascinating to me because this makes the whole process so much easier and it helps the consumer out drastically.  If it were not for these algorithms then people would sell their products a lot higher and there would be less action occuring.  The story is about a book selling for over $23 million because its algorithm was involved in a price war with another algorithm.  It is a humorous way of looking at the down side of computer generated prices. 

Article 38: How to Create Affordable Web Commercials

Author: Jeffrey Shapiro      April 24, 2011

http://www.metacafe.com/watch/2757642/how_to_create_affordable_web_commercials/

Class Tie-In

         I came across certain videos that I believe may be real effective commercials in the future, so I thought it would be important to make a journal entry about it.  The site promotes, “Instant Video Advertising creates professional quality video commercials to promote your small business or product for as little as $99, we then distribute your Video Ad to all the major video sharing sites like You Tube and Metacafe.”  The commercial I showed you is from Jeffrey J. Shapiro Associates, and I believe it will catch people’s attention.  These commercials are so cheap (
“as little as $99”) and as long as their message is clear, customers will be intrigued by them. This is just another example of social media is helping advertisers.  We talked about the different strategies of how to market your product, but typically we discussed large companies.  Instant Video Advertising is usually devoted to smaller companies with a lower budget for advertising, and it gives them a great way to connect to the public. 

Article 37: How Engaged Is Traffic from Social Sites?

http://static.addtoany.com/menu/sm2.html#page;https://kelly3333.wordpress.com/wp-admin/post-new.php

April 25, 2011       Source: emarketer.com

Author Unknown

Web users who follow links from social sites are less interested in their content

Person-to-person sharing has become a major way content producers hope to have their information disseminated as social media has offered the chance for content to go viral. Despite studies that suggest email is still the top way people share content, and that search is still the top way people find websites, social sharing—newer and more exciting—is in the spotlight.

According to data from Outbrain, just over 10% of external referrals are from social media sites, compared with approximately 41% from search and nearly a third from other content sites.

 

Referrals from social sites fall overwhelmingly into a few content categories. Social media users are eager to share—and click on—news and entertainment stories, which account for nearly three-quarters of all social media referrals. Industry watchers have posited that one reason for social sharing getting so much attention from the media is their outsize impact on media websites.

 Significantly, Outbrain also found social media referrals were less engaged than those from search or other content sites. They had fewer page views per session and a higher bounce rate. Outbrain also developed a definition of a “hyperengaged reader” as one who views at least five pages per session. Social media referrals were less than half as likely to be hyperengaged as referrals from content sites or search.

The Outbrain report suggested that content site referrals were already in reading mode, ready to consume more content, and search referrals were actively looking for information, making them naturally engaged. Social media site users, by contrast, make up fewer referrals to content pages, and those who do click are less engaged.

Class Tie-In

       Throughout this whole semester we have discussed the relevance of social media and its connection to marketing.  We have talked about how important social media has become and how all advertisers should utilize social media.  The real question is thought, how effective is social media when it comes to marketing?  This article is interesting because it is the first one that I have seen that shows social media is not all its cracked up to be.  People certainly look at content through social media, but they are not necessarily looking to buy anything they click on.  The researched conducted by Outbrain shows that social media typically effects news and entertainment stories, and not so much on technology or products.  They also say that search engines and email are still the most effective ways for advertisers to get their point across.  This research is certainly new, and social media evolves so rapidly, so we could see a change in these numbers very quickly. 

Article 36: 7% of Americans subscribe to Netflix

By Julianne Pepitone, staff reporter     April 25, 2011

Source: cnn.com

Netflix CEO Reed Hastings has presided over a decade of soaring growth at his video streaming and rental company.

NEW YORK (CNNMoney) — Netflix knocked over a new milestone Monday: It now has more subscribers than the largest cable TV operator in the U.S.

Netflix’s global subscriber base grew almost 70% over the past year, to 23.6 million users. With that audience, it dethroned Comcast (CMCSA, Fortune 500) as the country’s biggest provider of subscription video content. More than 7% of Americans now subscribe to Netflix.

 

Those details came out Monday in Netflix’s (NFLX) first-quarter report, in which the company reported earnings of of $60.2 million, or $1.11 a share. That’s up from $32 million, or 59 cents a share, a year ago.

Revenue rose 46% to $719 million. Both figures topped Wall Street estimates, but shares fell 2.5% in after-hours trade on light forecasts for the second quarter.

Netflix said it expects earnings of 93 cents to $1.15 a share for the second quarter, lower than analysts’ forecasts.

When you’re a giant, growth gets harder.

Netflix said in its release that it expects subscriber growth to continue at a rapid clip for the rest of the year, but it warned that year-ago comparisons will get tougher in the coming quarters.

The release also noted the emergence of new, competing services Hulu Plus Amazon (AMZN, Fortune 500) Prime. 

More content: Netflix is hoping to combat increased competition with more unique content. Last month, the company announced it had bought its first original show: “House of Cards,” featuring Kevin Spacey.

“This represents slightly greater creative risk than we’ve taken in the past, but we think it’s reasonable given the popularity of the original BBC show,” Netflix said Monday in a “letter to shareholders” released alongside its earnings report.

Netflix will consider the buy a success “if ‘House of Cards’ is popular enough on Netflix so that the fee we’ve paid is in line with that of other equally popular content on Netflix at the time,” Hastings wrote in the letter.

The company said it hopes to “license two or three similar, but smaller deals” in the future.

Netflix has also brokered deals with networks and studios. In its earnings release, the company admitted its recent deal with CBS “includes only a few on-air shows at present” — but it also makes Netflix the only online subscription service to offer shows from all four broadcast networks.

International concerns: Netflix launched in Canada late last year, and it ended the first quarter of 2011 with about 800,000 Canadian subscribers — lower than the company had forecast.

“We are still learning the seasonality curve and nuances specific to Canada,” Netflix said in its release.

The company had previously said it expected $50 million in operating losses in the second half of the year for the international sector. Now, it forecasts $50 to $70 million in losses — “which we are comfortable with given the size of the opportunity.”

On a post-earnings conference call, many analysts’ questions revolved around the situation in Canada. Hastings shrugged off most of the queries, saying “it takes time” to develop accurate data and forecast correctly in a new region.

Hastings also said developing apps for Google’s (GOOG, Fortune 500) Android operating system is “a big priority,” but he wouldn’t comment further on a timeline. 

Class Tie-In

       This article is nice because I wrote an article earlier about Netflix, so this just confirms the companies growth over the past few months.  It just seems that Netflix has done everything right in the past year, and this clearly shows because they have more subscribers than Comcast does.  We talked a lot about a product life cycle and it is interesting to hear Netflix’s life cycle.  They saw a boom in sales just in the past year which means they are going between their growth stage and maturity stage.  The article also mentions that they fear going through a decline stage because of other competitors catching up with them.  As of right now, they are just about at their peak, which is why their stock doubled in the past year, and it will be interesting to see where they go from here.  In this new media frenzy world you cannot just sit on one product, so hopefully Netflix expands to become multi-dimentional. 

Article 35: DORITOS® – HOUSE SITTING – Crash The Super Bowl 2011 Winner

http://www.youtube.com/watch?v=m9eb9S9_nOU

Class Tie-In

        This commercial is one of the best because it was understandable, funny, colorful, and shows you the pleasure of Doritos.  We talked in class about the dangers of marketing a product that is supposed to be “the best in the world,” or “greatest thing you will ever have,” because they make promises to consumers that certaintly are not true.  Doritos is making their product to appear to have the ability to bring back the dead, which is brilliant.  They are not promising anything, but yet they show you how great Doritos can be.  Also, bringing people or fish back from the dead obviously cannot happen, so they are being humorous while promoting this product.  What is also great about this commercial, which many people would not catch, is that sounds effects add so much to the commercial.  You can hear a loud crunch whenever the man bites into a chip, which makes the consumer see how crispy and crunchy Doritos are.  There are Doritos everywhere in this commercial and they market their different flavors and their different sizes.  Overall it is a great commercial, and one that includes many topics that we discussed in class. 

Article 34: Google Says It Collects Location Data on Phones for Location Services

By: Miguel Helft          Source: NY Times

April 22, 2011

Google said Friday that it collected location data from Android phones, but that it did so anonymously and with user consent. The company said it gathered the data to provide services like maps and searches for shops or restaurants near a person’s location. The company said it also used the information to estimate traffic on various roads.

“Phones know where you are, and they need to for many of the services we offer,” said Mike Nelson, a Google spokesman.

Mr. Nelson was responding to a growing controversy that erupted Wednesday, when researchers reported that Apple’s iPhone and iPad stored the places visited by a user in an unencrypted file in the phone, and later on the user’s computer when the phone or tablet was synced. Further reports said the data was being transmitted to Apple, albeit anonymously.

While many privacy advocates and iPhone users said they were alarmed by the discovery, some security experts said they believed Apple was collecting the data not to track users but to be able to pinpoint a phone’s location more quickly, saving bandwidth and battery life, when their owners used location-based services like maps and navigation. Some also said Google was collecting similar data and also storing it on phones.

Apple declined to comment. (Last year, Steven P. Jobs, Apple’s chief executive, said that unlike many competitors in Silicon Valley, Apple takes privacy very seriously. He singled out location as an area of particular concern. “Privacy means people know what they are signing up for,” Mr. Jobs said. “In plain English and repeatedly. That’s what it means.” (Watch the video of the interview.)

Mr. Nelson said that while Google tied the location to a unique identifier, it did not link it to a person. Some privacy advocates, however, believe that given a phone’s movements, it would be easy to identify the person to whom it belongs.

While many cellphone owners believe that the services that pinpoint their location on smartphones rely on GPS technology, more often than not, companies like Google and Apple identify a phone’s location by comparing the names and strengths of nearby Wi-Fi hotspots against a database of Wi-Fi hotspots. The technique was pioneered by Skyhook Wireless. Apple initially relied on Skyhook’s technology.

But over time, Google and Apple began building their own databases of Wi-Fi hotspots. Google did so with its StreetView cars. And both companies do so by using their customers’ phones as sensors.

Still, some wondered why the companies needed to store information on users’ phones.

“We do not store info on the phone,” said Michael Shean, the co-founder and senior vice president of business development at Skyhook. Mr. Shean said it too used data from users’ phones to update its database of Wi-Fi hotspots. But he said it only looked up the information when a location-based application asked for it, as when, a camera application tried to geotag a photo. “We only do a location look up when an application requests it,” he said.

Mr. Shean said pinpointing location through Wi-Fi hotspots was often more accurate than through cell towers, and easier than through GPS. He said it complemented GPS well, since the satellite-based system often did not work well in streets surrounded by tall buildings or in indoor locations.

Class Tie-In

            This article helps us to see why Google remains as one of the best companies for marketing.  They stay current and up to date with all the latest software and devices which help the public get the information they desire.  Collecting data along with data mining can have huge results for marketers when it comes to understanding the customer to the fullest.  With this information that Google receives through Android phones, they can suggest what you may like in the area based your location and the public’s habits.  It is not an invasion on privacy, which could have been cause for concern because they receive the information annomously.  With what Google is doing, it will cause more advertisers to pay Google to help promote their products.  It is also great because everyone can benefit; Google, the consumer, and the advertiser.  Again, this issue of social media comes up, and it just proves how important it is to market through social media. 

Article 33: One Size Fits Nobody: Seeking a Steady 4 or a 10

By STEPHANIE CLIFFORD               Source:  NY Times

Published: April 24, 2011

In one store, you’re a Size 4, in another a Size 8, and in another a Size 10 — all without gaining an ounce.

In foreground, Liz Reviello and her daughter Alyssa use the results of the body scanner from MyBestFit to find the right size.

 

 A Different Size 8 for Each Designer

 

Vharie Carter, left, shows Liz Reviello of Scranton, Pa., how to position herself in a body scanner.

 

It’s a familiar problem for many women, as standard sizing has never been very standard, ever since custom clothing gave way to ready-to-wear.

So, baffled women carry armfuls of the same garment in different sizes into the dressing room. They order several sizes of the same shirt online, just to get the right fit.

Now, a handful of companies are tackling the problem of sizes that are unreliable. Some are pushing more informative labels. Some are designing multiple versions of a garment to fit different body shapes. And one is offering full-body scans at shopping malls, telling a shopper what sizes she should try among the various brands.

“For the consumer to go out and navigate which one do I match with is a huge challenge, and causes frustration and returns,” said Tanya Shaw, an entrepreneur working on a fit system. “So many women tie their self-esteem to the size on the tag.”

As the American population has grown more diverse, sizes have become even less reliable. Over the years, many brands have changed measurements so that a woman who previously wore a 12 can now wear a 10 or an 8, a practice known as “vanity sizing.”

In men’s clothes, the dimensions are usually stated in inches; women’s clothing involves more guesswork.

Take a woman with a 27-inch waist. In Marc Jacobs’s high-end line, she is between an 8 and a 10. At Chico’s, she is a triple 0. And that does not consider whether the garment fits in the hips and bust. (Let’s not get into length; there is a reason most neighborhood dry cleaners also offer tailoring.)

Ms. Shaw, the entrepreneur, is chief executive of a company called MyBestFit that addresses the problem. It is setting up kiosks in malls to offer a free 20-second full-body scan — a lot like the airport, minus the pat-down alternative that T.S.A. agents offer.

Lauren VanBrackle, 20, a student in Philadelphia, tried MyBestFit when she was shopping last weekend.

“I can be anywhere from a 0 at Ann Taylor to a 6 at American Eagle,” she said. “It obviously makes it difficult to shop.” This time, the scanner suggested that at American Eagle, she should try a 4 in one style and a 6 in another. Ms. VanBrackle said she tried the jeans on and was impressed: “That machine, in a 30-second scan, it tells you what to do.”

The customer steps into a circular booth, fully dressed. A wand rotates around her, emitting low-power radio waves that record about 200,000 body measurements, figuring out things like thigh circumference.

Next, the system matches the customer’s measurements to clothes in its database. MyBestFit currently measures clothes from about 50 stores, including Old Navy, Eddie Bauer and Talbots.

Customers then receive a printout of the sizes at each store that ought to fit the customer best. The retailers pay a fee when they appear in the results, but they cannot pay to be included in the results; the rankings are based solely on fit. (The company saves the data, with ID numbers but not names, and may give aggregate information to retailers as feedback.)

Don Thomas, who manages the Eddie Bauer store at the King of Prussia Mall outside Philadelphia, said the system was helpful to shoppers. “Nine times out of 10, if left on their own, they will choose the wrong size pant,” he said. With a printout, “if it says they’re a 4 or a 6, they’re a 4 or a 6, generally. So it’s really good for the customer who’s time-starved, which we all are.”

Ms. Shaw says there are plans for 13 more scanning machines in malls along the East Coast and in California by the end of the year.

The sizing variations are a big contributor to $194 billion in clothing purchases returned in 2010, or more than 8 percent of all clothing purchases, according to the National Retail Federation.

The scanners are a modern solution to an old problem. Studying dress sizes in Vogue advertisements from 1922 on, Alaina Zulli, a designer focusing on costume history, found clothing sizes have been irregular for decades.

A woman with a 32-inch bust would have worn a Size 14 in Sears’s 1937 catalog. By 1967, she would have worn an 8, Ms. Zulli found.

Today, she would wear a zero.

Plenty of people have tried to address these arbitrary sizes. Advocating a labeling system called Fitlogic over the last few years, an entrepreneur, Cricket Lee, discovered just how difficult it is to change manufacturers’ approach to size.

Her labeling system divides women’s bodies into three shapes, straight, hourglass or bottom-heavy, and a Fitlogic label carries both the standard size and the shape.

Ms. Lee did tests in the mid-2000s with manufacturers like Jones Apparel and retailers like Nordstrom. But retailers said consumers had trouble grasping the concept. “The manufacturers were so afraid of producing more than one fit in the very beginning,” she said.

Still, she said, she will soon try to sell the sizing system again.

Some brands are taking their own approaches to make the fitting room less demoralizing. Mary Alderete, vice president for women’s global marketing at Levi’s, said, “When we try on 10 pairs of jeans to buy one, the reason you feel bad is because you think something’s wrong with you.”

Last fall, the company introduced Curve ID, a line that offers three styles, depending on how rounded a woman’s backside is — slight, demi and bold. (Levi’s is now testing a fourth style, called supreme curve.) Each of the three styles includes about 29 fits and colors, and dozens of sizes. Ms. Alderete said the company had sold more than one million pairs of the Curve jeans.

Marie-Eve Faust, the program director of fashion merchandising at Philadelphia University, called the Levi’s effort “a good start.”

“The next step is to have the major players sit together, manufacturers, retailers, brands, and say ‘This type of label should be appropriate for all of us. Let’s standardize,’ ” she said.

Dr. Faust said she had been discussing a new kind of label that takes into account the wearer’s shape, but expected retailers to bristle.

Still, Dr. Faust said, change is needed.

“It would be nice just to take the pant, look at the label and say, ‘That should fit me,’ ” she said.

Class Tie-In

            This article intrigued me because it opened my mind to new issues because men typically do not have too many sizing issues at stores.  For these women though, they experience a lot of “frustration and wasting of time,” and leads to a lot of returns on clothing.  This issue of different sizes in different stores has opened up ideas for entrepreneurs to create solutions.  MyBestFit has created a body scanner that allows people to have their body measured from all the stores in the mall at once.  We talked in class about the goal of marketing is to ultimately create pleasure and utility, and this new body scanner is a great way to do that.  There is almost zero marketing needed for this product because it is basically a necesssity now because it saves women so much time.  The article also brings up an interesting debate because retail marketers are now offering “vanity sizes.”  These vanity sizes mean that while you were once a 12 or 14, you are now an 8 or 10.  This is great ploy for marketers because it helps women like that certain retailer because they appear to be losing weight and getting thinner. 

Article 32: In Online Games, a Path to Young Consumers

By MATT RICHTEL             Source:  NY Times

Published: April 20, 2011

HESPERIA, Calif. — Deep into one of her favorite computer games, Lesly Lopez, 10, moves her mouse to click on a cartoon bee. She drags and drops it into an empty panel, creating her own comic strip.

Nut Cheerios Web site, and pesters her mother to buy sugary cereals. More Photos »

What should parents know about online marketing to children? Should food companies face tougher regulations when communicating with children online? The Pulitzer Prize-winning reporter Matt Richtel will respond to readers’ questions.

Multimedia

 Lesly likes this online game so much that she plays twice a week, often e-mailing her creations to friends. “I always send them to my cousin in Los Angeles,” she said.

But this is not just a game — it is also advertising. Create a Comic, as it is called, was created by General Mills to help it sell Honey Nut Cheerios to children.

Like many marketers, General Mills and other food companies are rewriting the rules for reaching children in the Internet age. These companies, often selling sugar cereals and junk food, are using multimedia games, online quizzes and cellphone apps to build deep ties with young consumers. And children like Lesly are sharing their messages through e-mail and social networks, effectively acting as marketers.

When these tactics revolve around food, and blur the line between advertising and entertainment, they are a source of intensifying concern for nutrition experts and children’s advocates — and are attracting scrutiny from regulators. The Federal Trade Commission has undertaken a study of food marketing to children, due out this summer, while the White House Task Force on Childhood Obesity has said one reason so many children are overweight is the way junk food is marketed.

Critics say the ads, from major companies like Unilever and Post Foods, let marketers engage children in a way they cannot on television, where rules limit commercial time during children’s programming. With hundreds of thousands of visits monthly to many of these sites, the ads are becoming part of children’s daily digital journeys, often flying under the radar of parents and policy makers, the critics argue.

“Food marketers have tried to reach children since the age of the carnival barker, but they’ve never had so much access to them and never been able to bypass parents so successfully,” said Susan Linn, a psychiatry instructor at Harvard Medical School and director of the Campaign for a Commercial-Free Childhood, an advocacy coalition. Ms. Linn and others point to many studies that show the link between junk-food marketing and poor diets, which are implicated in childhood obesity.

Food industry representatives call the criticism unfair and say they have become less aggressive in marketing to children in the Internet era, not more so.

Since 2006, 17 major corporations — including General Mills, McDonald’s, Pepsi, Coca-Cola and Burger King — have taken a voluntary pledge to reduce marketing of their least nutritious brands to children, an effort they updated last year to include marketing on mobile devices.

The pledge says the companies, if they choose to market to children, will only advertise food choices that are “better for you,” said Elaine D. Kolish, director of the Children’s Food and Beverage Advertising Initiative, an arm of the Better Business Bureau that oversees the pledge.

“Compliance is excellent,” she said of the pledge. She noted that in recent months, companies had shut down several child-centric sites, including General Mills’s popular virtual world Millsberry, while other sites have been changed to focus on adults, like those of Kellogg’s Pop Tarts and Pepsi’s Cap’n Crunch. And she said General Mills and Post Foods had cut or pledged to cut the amount of sugar in some cereals.

Only rarely do these major companies violate their pledges, she said: “It’s pretty darn infrequent and it’s not willful.”

Nutrition experts say that the voluntary pledges are fraught with loopholes, and that “better for you” is a relative term that allows companies to keep marketing unhealthful options.

Whatever criticism they may invite, the companies have good financial reason to pitch to children. James McNeal, a former marketing professor at Texas A&M University, estimates conservatively that children influence more than $100 billion in food and beverage purchases each year, and well over half of all cold cereal purchases.

Children “have power over spending in the household, they have power over the grandparents, they have power over the babysitters, and on and on and on,” said Professor McNeal, who has researched family behavior for decades and consulted for major companies on marketing to children. “All of that is finally being recognized and acknowledged.”

Some parents, like Lesly Lopez’s mother, Toribia Huerta, 26, say the online marketing is subverting their efforts to improve their children’s diets. Ms. Huerta said Lesly and her younger siblings pester her for sugary cereals they see in the games and for snacks like Baby Bottle Pops, a candy with a game site that the girl also visits often.

“They ask me for it constantly. They’re hard to resist when they whine,” Ms. Huerta said, speaking in Spanish through a translator. She blames her daughter’s love of sugar for her dental problems, including many cavities.

                                                             

But Ms. Huerta also said the food sites seemed fun and safe: “They look like good games for her age.”

Class Tie-In

        This article fits well with our class because on one side we learn about effective ways for marketing, and on the other we learn about ethical dilemmas.  This article addresses new ways for companies that can sell to kids to market through online gaming.  It is interesting because it is similar to what we were supposed to do for our marketing plan, which was to effectively use social media to market our product.  These companie; General Mills, McDonald’s, Burger King, Coca-Cola, etc.. are using social media to attract these kids to play games, and then to post something about them online.  It is a very effective way to advertise because you incorporate a game (which kids play all the time) and immerse them in your product, so they have a bond with your brand when they go to the grocery store.  It is not necessarily hidden advertising because you go to the products website, but it is advertising associated with pleasure.  The ethicl debate is very interesting because kids have access to the internet and they will believe anything they see.  When they see sugar and something that is “irresistable” or “great tasting” then they can not pass that up.  In class we talked about a moral dilemma between the greedy marketer just seeking maximum profit, verses the moral marketer who wants profit but wants to better society.  This is why the “White House Task Force on Childhood Obesity,” is asking for these companies to only market products that “are better for you.” 

Article 31: UPS Politically Incorrect Ad

http://www.youtube.com/watch?v=3osr-1P5FfI&feature=related

                                                                                                      

  Class Tie-In

          This commercial is completely senseless.  In our class we just mentioned PR, and the PR associated with this commercial is terrible.  When you make an advertisement and the article associated with it reads, “UPS Politically Incorrect Ad,” then you are doing something wrong.  UPS creates a racial issue for absolutely no reason.  For a delivering company to create a politically incorrect ad, it makes you question the marketers behind this commercial.  We talked about how advertisements are supposed to build up brand equity,  but this commercial fails to do this.  The commercial is completely unrelated to UPS and their overal mission.  It is not a completely negative commercial, it is just a complete waste of money because it does help their brand whatsoever.  A consumer watching this will not be attracted to use UPS in the future because it does not show any utility it can provide to the customers.