A Different Perspective...

It is so interesting to me that people have a critical view of Private Equity (PE) and similar firms. They are typically referred to as “brand killers” due to the leverage they use to acquire companies with lower equity contributions.

The goal of PE firms is to maximize value from any company, and to be able to realize as much value as possible, over the life of owning the company. It is unfortunate that some PE firms drain cash from companies, and are short-sighted in their investment goals. However, it may also be the case, that a PE firm invests in a failing brand (i.e. the company would have gone bankrupt without a buyer), hoping to revive/re-create an industry leader, that can be sold at a later date (or spunoff through an IPO) to materialize the value of the investment.

I am in favor of having a PE industry veteran in the WH to focus on trimming costs and operations, streamline processes, and focus on turning this country around…we are only hurting ourselves thinking that we should raise taxes to give big government more money to spend in negative investment programs (i.e. boondoggles).

I will be casting my vote in favor of Romney, based on these attributes.

It will be interesting to see what happens to AMR in the future - I don’t think they will disappear anytime soon, given the current competitive landscape in the domestic airline industry, but I think they need to re-analyze their cost structure (which they have announced as part of their plan).

I used to fly AA regularly for work, when I lived in California - and they had an aging fleet nearly 10 years ago. From what I know, they haven’t spent significant funds in purchasing a new fleet - putting them behind the race for operating fuel-efficient aircraft.

I hope that AMR can bring the pieces together and sort out their operations, including negotiating concessions with the unions…

There is continued evidence that the advertising market is weak, and has not recovered to pre-recession levels. There are two things that are interesting about this data: (1) companies are continuing to spend on digital advertising; and (2) marketing agencies still haven’t figured out the right strategy to maximize customer impact.

The first point is easy to see - it is visible in the earnings of GOOG, YHOO, MSFT and other companies that benefit from digital advertising. It is easy to say that companies are “shifting” ad dollars away from print toward digital advertising. However, if you look were to analyze the data, the real story is that companies are increased digital ad spending (which was always part of their strategy), and they are reducing their spend on print advertising (not because they are shifting ad dollars, but because their budgets have decreased and they need to make decisions on where to allocate funds). Digital ad spending, for most companies, is necessary as another medium (re: outlet) to reach consumers. In today’s marketing world, where agencies and marketing directors need to quantify the impact of their efforts, it’s easy to focus on digital ads where the impact can be tracked at detailed levels. However, although print advertising is more difficult to track, it should not be ignored completely as “less useful” than digital ads - companies need to figure out how to develop a holistic campaign that leverages both platforms.

The best marketing strategy is one that leverages both print and digital platforms, as complementary tools (1+2 instead of 1 or 2). As an example, I was reading the WSJ last week (in paper form, because that is my preference) and I noticed an ad campaign that I felt did an excellent job of marrying both platforms to optimize my engagement. Allstate insurance utilized a full-page ad to ask me to support a bill in Congress that would create a ‘graduated’ driver’s license program for teenage drivers (11 teens are killed every minute in a car accident on average). The campaign asked me to voice my opinion by logging on to their FB page, to voice my opinion to my elected Congress representative. As we can all admit, if the ad asked me to write a letter to my Congress office, I probably would not have taken any action. However, because they leveraged FB to gather my information, and offered to submit the letter on my behalf, it made the process very easy for me to take action and let my voice be heard.

As an interesting follow-up, I posted ‘shared’ this campaign on my FB page to see how many people were intrigued to take action based on a digital feed about the campaign. My wife, who is pro-digital, told me yesterday that she saw my post on FB, but didn’t click on the link to read what it was about - this is where digital ads fail, they don’t provide enough information to create action (and our attention span online is somewhat limited). I hope advertising executives get this right in the future, and figure out that they need to spend on print AND digital ads to have the most impact, creating an interactive experience for all users.

Yet again, I think this is another example of an industry that is taking steps to adapt to, and embrace, digital technology as a tool to supplement their “brick-and-mortar” operation. The newspaper industry has been under attack on many fronts, from a declining subscription base for print media to legitimate free media available through the internet that undermines the ability of journalists to be compensated at historical rates for their efforts.

The most successful newspapers have been able to monetize their journalistic efforts by establishing “paywalls”, requiring consumers to pay for content (i.e. journalist quality information) that provides accurate, reliable and timely news. Leveraging their brand equity, WSJ and NYT have proven to consumers that they can add value, at a reasonable price, to how information is delivered (and available).

If newspapers (and more broadly, print media) is going to survive into the foreseeable future, companies need to adopt digital tools to supplement their print capabilities, instead of fighting efforts to make information available in real-time. I think there is a market for both print and digital media to work together to provide value-added services to customers and consumers, and the most successful companies will embrace both platforms.

I don’t know why banks still exist as commercial enterprise. Given their inherent control of the economy through their depository and lending activities, they can render the country helpless (or try to make huge profits from companies that would otherwise use the funds to invest back into the economy).

I think there should be much more regulation on retail and commercial banking operations. Yes, there is opportunity to make money in sales and trading and investment banking, but these areas should not be part of banking institutions. I hope we get this right someday.

When it comes to acquisitions, I am a firm believer in free market capitalism. While I understand the argument, in this case, that AT&T could use its dominance in the market to demand higher prices from customers, and/or other providers that want to have a “roaming” agreement with the carrier.

However, I also believe that there are still enough options out there that if AT&T tried to charge higher prices, it would notice consumers defecting to Verizon, Leap, or other carriers. As such, it will be unable to sustain its high operating cost model, and would be forced to lower prices to maintain operating costs adequately.

I see this acquisition as a positive opportunity for AT&T to improve its coverage and quality, with increased spectrum availability. As a current AT&T customer, and anyone else who is knows this, they have some really great coverage in cities like NY and LA, but very poor coverage in areas like Chicago.

Ultimately, I think this deal is a positive for the industry, and it will get approved with certain requirements from the FCC and/or Justice Department

I haven’t heard of ScrollMotion, but from the article and interview, it sounds like they have been heavily involved (and vested) in the shift to digital content, and how it can enhance print media (rather than compete against it).

This is actually something I have been understanding more and more about over the past year, with a particular company in the print media sector. The players that survive, and continue to grow, are the ones that understand the shift, and align with their customers to support the shift in media preferences (i.e. more digital/interactive content, less static/print content).

I don’t think print media will be going away anytime soon - there is still a significant population that likes to hold and feel the book, magazine, advertisement, etc. (I will admit to being one of them), and the best companies going forward will be able to add value by managing both print capabilities and digital capabilities.

This just confirms my view on the state of the industry…

It’s about time the banks came together and used their technology, under a common platform, for the “greater good”, instead of keeping each of their respective systems proprietary.

It will be interesting to see how much market share they can steal from the PayPals and Google Payments of the world. I have a PayPal account, but I don’t actively use it because it feels somewhat “unsafe”, and I have had a bad experience with the types of merchants using PayPal previously. However, a payment system from the banks (while it may have more/less fees than other platforms) seems to me that it would have significantly more inherent security features to protect your account, and related activity.

I am excited by this announcement, and hope to try this out once it launches…!

I think it’s very interesting that there is a market for trade-ins in the electronics market, and in general for most technology products. With the speed of obsolesence shrinking constantly, and new products being developed and released within less than a year, it seems interesting that Amazon is willing to pay for trade-in electronics.

I feel there is probably a strong need for a recycling facility, of sorts, to allow the electronics to be broken down into raw product that can potentially be re-used, to minimize the impact on the environment. However, I don’t think this is Amazon’s purpose. It also seems to focus on more-recent, and relevant, electronics (e.g. iPhone, Xoom, etc.) rather than your old VCR or DVD player.

It will be interesting to see how useful and relevant this program becomes to minimizing electronics ‘waste’.