Hacking, Consumer Purchase Data, and Pyramid Schemes

Good Evening Ladies and Gentleman. Welcome to Late Night Critic.

The Olympics in Sochi this year have brought to light a huge problem in our technology driven world, the hacking of our private information (story seen to right). This data could come from a cell phone or from a company keeping track of credit card information. The problem is a hacker could access all of our information at the click of a button. All they need is a computer and the program to do the work for them. They could be sitting in their pajama's just waking from a comfortable slumber, meanwhile they are destroying your personal information. From bank records to keeping a pregnancy private, today I want to discuss why people today depend on technology too often.

If you haven't been following the Olympics closely you may not have noticed the story on Russian hackers. A more local example of an attack on our consumer privacy was during the 2013 holiday season. Who was the target of this attack? Target of course!

How does a company as big as Target get broken into from across the globe? The hackers got access through the use of another companies credentials. Companies today are becoming more and more interconnected as networking developments allow us to become closer despite being long-distances apart physically. Companies give database access to their partners so they are able to work seamlessly and efficiently. This is where the problem stems from, there are so many pathways to get to the database that its near impossible to keep them all safe. The hackers (rumored to be from the Ukraine) simply got access from a partner of Target's, or from a Target employee, and went to work from there.

Target, in my opinion, has done the best they could to make up for this breach. They alerted all possible victims and have worked tirelessly with banks to solve the problems. It's just important for all parties involved to know that this could have happened to any company.

Another example of a company being used to retrieve private information is Verizon. Below is a video that explains it pretty well, but the point is even in America our phones aren't necessarily always safe.

To be honest, I depend on technology as much as anyone in this world. That probably isn't good, but the alternative is to lose efficiency and fall behind socially. Businesses have custom built share folders, that allow work to be done at all hours of the day. School's have the ability to check for plagiarism with the push of a button. There are numerous free services that allow an individual to work on a document with a group of people at the same time, from their desktop or even their phone (Example: Google Drive). I think that all we can do is be careful with the information we put into our electronic devices and do our best to encrypt the private data that is transferred across the internet.

With all of the hacking of information occurring many people find themselves asking why it is so important for companies to keep personal information at all. Is it fair that companies keep purchase records, credit/debit card information, our address and/or phone number? I feel that it has the ability to be used fairly and in a positive manner. I have two examples of a company using purchase data, lets look into Target and Safeway.

First, I have to start with another reference to Target. A while back a teenage girl got a mailer from Target, normal stuff. However upon opening the mailer the teenager, and her entire family, noticed the whole thing was built around maternity clothes, baby cribs and the like. It was a specific mailer for a pregnant woman. Long-story short, Target had determined the teenager was pregnant before she had told anyone else. This obviously felt like a huge breach of privacy. And left Target looking into their consumer privacy policies. Now Target is more careful about the mailers they send out, they simply mix in other products with the customized coupons. By doing this the mailer looks much more generalized but still produces the same purchase-inducing effect.

Target was originally breaching their use of customer information here. It is fair and beneficial for all parties if a consumers purchase history is utilized to send specific coupons for what they are already buying. But to also "predict" the current state of the consumer (pregnancy in this case) and then to basically let on to the fact that the company knows of that state is just plain creepy. Target's "Guest Marketing Analytic's" department does their best to keep the targets of their data from feeling spied on. However at the end of the day, if the customer doesn't feel spied on then they are only benefiting from coupons being catered to them.

Safeway, and their rewards program Just 4 U, also uses customer purchase data to determine what consumers get what discounts. Their system tracks all purchases made on a card and then posts customized coupons just for the specific products that consumer buys, when available. This is a huge benefit to consumers, with no real down side.

There are even reports of some malls and stores in America being able to locate customers via their smart-phones and then send them specific coupons or deals based on their location. The Federal Trade Commission is currently looking into this technology to confirm its anonymity.

Overall, I feel that the use of customer purchase data walks a fine line between helpful and creepy. The key is how the data is used, how the consumer views the results of their purchase history, and how a company keeps that data secure. If a company is able to use the data to produce deals and ads based around the consumer all the while keeping their information safe, I see no reason why we shouldn't welcome this method with open arms.

Best Business Blunders

Pyramid Scheme's
Recently a friend of mine was nearly duped by a "pyramid scheme". What is that you ask? I have a handy diagram to help explain! (There's also a definition in the quotes above!)

Basically a pyramid scheme is a continuous loop of people asking other people for money and taking a portion of that money with the rest going to the head honcho. Then the new people do the same to some of their friends and the money works its way up the chain. Eventually people realize there is no real product changing hands or the base of the pyramid cant fulfill the investments of the individuals above it. Then the pyramid falls apart and the only real winner is the first "member" of the company.
Pyramid schemes aren't easy to spot, they come in all shapes and sizes. Gone are the days of simple investment scams. Today, what may seem like a legit business could just be a pyramid scheme hidden behind smoke and mirrors. It's important for people to truly understand what to look for, so they don't invest in a company only to end up losing money.

So what is the lesson learned? When told about "the next big money maker" be wary. Some things are too good to be true.

Thank you for reading,

Alex Oldfield

Ambush Marketing vs. the Olympics

Good Evening Ladies and Gentleman. Welcome to Late Night Critic.

The 2014 Winter Olympics are upon us. America is off to a fair start, and the US Hockey team had a thrilling game against Russia winning in overtime (America's record is now 3-0). However some of the athletes aren't fairing so well, such as the speed skaters. They were favorites coming in to the Olympics, but for reasons unknown they have yet to medal. Its been speculated that their new suits, Under Armour's "Mach 39", have been the problem, and so the USA speed skating team has dropped the uniforms. Normally "any advertising is good advertising", however I feel that doesn't apply here.

The results of the Olympics, however interesting they may be, are not what this blog was made for. I want to present some of the more controversial advertising based off the Olympics. Who is using ambush marketing and is that strategy even fair? Also, I want to discuss who should not be allowed to sponsor the Olympic's and why.

What is Ambush Marketing?
Companies who do not pay to sponsor a specific event (whether it be sporting or otherwise) but use symbolism or loopholes to advertise near or around that event are using a technique called "ambush marketing". The difference between official advertising and ambush marketing boils down to a lack of paid fee's to be on air or present at the event. An example from the Super Bowl of ambush marketing would be the commercial seen below. Produced by Newcastle Brown Ale the spot was a behind the scenes look at a commercial that never aired. There were multiple variations, but the main point was that Newcastle couldn't even used the phrase "Super Bowl". Here Anna Kendrick is interviewed about the commercial that could have been, and she isn't too happy about its cancellation.

Now that you all know what ambush marketing is, what are your thoughts? (Let me know in the comments!)
I am a firm believer in competition breeding excellence. And that is essentially what ambush marketing does, create competition. In my opinion it is fair and sometimes even necessary for ambush marketing to take place. It shouldn't be enough for a company to just buy ad space, or in the case of the Olympics, official sponsorship. Companies should have to earn their advertising and through that earn their consumers interest. Besides, if a company who paid to advertise with the official Olympic logo and at the event itself can't garner as much attention as a company who advertises in round-a-bout way then that's the official sponsors fault. I think that ambush marketing is necessary in all forms.

Who has used this method so far during the 2014 Winter Olympics Games?
Subway is well-known for their use of ambush marketing based advertising. They somehow are able to evoke thoughts of big sporting events (aka the Olympics) without a single mention of the event or even insinuating about the event.
Zippo managed to pull off an amazing feat this year as well, while the Olympic Torch was being run through Kremlin, Russia the flame died out. A policeman pulled out a Zippo to light the flame again and within 24 hours Zippo had created a page and hash-tag around "Zippo Saves Olympics". This eventually was changed after Zippo was contacted by the 2014 Winter Games officials.

Who shouldn't be advertising?

Sadly the connection between McDonald's and the Olympics is old and strong, despite the fact that the two are nothing alike. The problem with McDonald's advertising with the Olympics is that it puts in young consumer's minds that fast-food is connected to sports glory. In a world where childhood obesity is rising why is a company like McDonald's allowed to support the greatest athletic spectacle known to man?Because McDonald's has been a sponsor since 1976. The Olympics are remain loyal to their age-old sponsors.
However there is hope, during the 2012 London games the Olympics discussed ending their partnerships with unhealthy sponsors. Companies such as McDonald's, Coca-Cola, and others will have to promote their products through healthier messages to retain their sponsorship rights. The results of this discussion have yet to be seen, as all companies listed in the memo are still advertising at the 2014 Sochi games.

Companies Achieving Olympic Gold
On a side note, the top rated sponsor of the Olympics so far is P&G with their commercials based around a moms work and the jobs they have in raising Olympic athletes (seen below is one example). Other top Olympic sponsors are Febreze and United Airlines. (MarketWatch.com)

This week in BBB: Dewars Scotch
With our eye on international advertising throughout the Olympics I thought it would be fun to look at a BBB focused on international mishaps. I consider myself a whiskey connoisseur and so when it comes to advertisements about whiskey I shut up and listen. There are some great ones (see Johnnie Walker), but that isn't what BBB is all about. I have to say one of my least favorite commercials of all time is Dewars Scotch "Drinking Man". First, the idea of a scotch for the "drinking man" is insanely inconsiderate. There are many people in the world today suffering from alcoholism, and this advertisement basically says "we're the drink of choice for alcoholics", not cool. Secondly, Dewars is pushing the Scottish idea much too far. The actress is British and she is using a simple Scottish accent. You don't have to push the Scottish theme! It's almost in the name for Pete sake.

So what is the lesson learned?

Choose your words (and accents in this case!) carefully, you never know who could interpret you in the wrong way.

Thank you for reading,

AO

Super Bowl vs. the Commercials

Good Evening Ladies and Gentleman. Welcome to Late Night Critic.

It's been a whole week since the biggest sporting event in America, and my biggest question to you is: What do you remember more, the Super Bowl itself? Or the Super Bowl commercials?
You see this year I feel the commercials in general flopped. There are a few reasons, and I'll get to those in a minute. But overall between the lackluster game and the awkward commercials I don't know which chunk of those 5 hours shined brighter, to me. Don't get me wrong, some of the ads were brilliant, but this year that was the exception to the rule. Why did this year's collection of commercials seem so bland?

Let's start with the price for a time slot, $4 million for 30 seconds of air time (roughly $133,000 a second). While this is similar to 2013's Super Bowl time cost, it takes away from the money that can be spent on the commercial itself. Many companies can negotiate deals (on bundles and ordering early), and to most big brand companies $4 million is just petty cash. So there is probably a different reason for the lack of brilliance in the commercials this year.

(On a side note, I do wish a portion of the revenue generated with the $4 million time slots was given to charities or even education so that the money could be used for more than filling the pockets of the higher-ups as well as justifying the insane price-tag.)

What I think the real reason for the more processed commercials this year is, is the entire spectrum required to create an efficient use of the time bought. A company spends $4 million on the time slot, but in today's social media driven world there is much more required of a commercial. There has to be hype created before-hand, and some sort of response to consumers after the Super Bowl. Not to mention the thousands of little social media messages or "secrets" that are slipped to get consumers enticed before the big day. I think it is important to balance all of the above to ensure a successful campaign, and that is why so many companies fell-short this year.

One other problem I feel, was the amount of companies who released their advertisements the week before the Super Bowl. This lowers the hype of the release on game day, as there is nothing new to see.

However there were a few advertisements that stuck out to me throughout the game. So here is my...
Top 3 Super Bowl Commercials:
At Number 1: Budweiser "Puppy Love"

As I stated in my last post I have a dog of my own, a black lab at that. And so this advertisement had a great effect on me, as well as the people I watched the Super Bowl with. Budweiser took what worked for them last year with the Clydesdale's and added the cuteness of a puppy. Anther heart-warming commercial from Bud and another success in my book. This was an easy choice for number one.

Number 2: Chevrolet "Romance"

The first time I watched this commercial I felt like it was in slow motion, because I kept expecting something big to happen (whether it was emotional or action-based). Finally when the cow shows up at his new farm, and it all comes together I broke out in laughter, and I still enjoy this commercial. Good humor, and a message that is consistent with their target market. A good use of $8 million.

Number 3: Coke "America is Beautiful"

I thought this was a great commercial, it touched on Coke's theme of America United. The only problem? The comments of the general public in response to this commercial...

This week in Best Business Blunders: America (Based on their reactions to Coke "America is Beautiful")
This week's BBB is special. Why? Because I am frustrated with America's response to a beautiful commercial. Coke has, in recent years, promoted how America is strong through diversity and is a place of pride for all those accepting of equality for all. This is also how every American describes this great country, as they puff their chest in pride. But based on the responses in the above link, is America really a country full of acceptance and a belief in equality for all?
I think the first thing that should be mentioned is that the only true natives to this country are Native American's, whom we so forcefully stole this land from. Also, if we are to call ourselves the "Melting Pot" of the world, then we must be accepting of all peoples AND their culture. What is sad about the whole situation is the positive responses and the overall good feeling to be had from this commercial is drowned out by the negativity of a smaller minority. There were some positive responses, even some responses to those who were negative.
The only saving grace in this whole ordeal is that a good portion of those who were clearly against equality in America only made themselves look worse by using improper English (or "American" because apparently that's what we speak) and some did not even know that America the Beautiful wasn't our National Anthem. Those comments only helped to discredit their opinions from being taken seriously.

So what is the lesson learned? If you are going to complain about a commercial not being American enough, or not using enough English then at the very least speak English and know your facts. But also, if you're American, have pride in your country AND all of the people who live in it and make it great.

Thank you again for reading!

Alex Oldfield

My Top 3 of 2013

Good Evening All, welcome back to Late Night Critic.

There are two reasons for this sudden Top 3 post. First I want all of my readers to know where my opinions lie about certain types of advertisements. That way if you (my lovely readers) disagree with me completely, you'll never have to read one of my posts ever again! Second, I feel if I am to have any sort of credible blog about advertising, I should probably list some actual advertisements and why I favor them. Also, with the Super Bowl today my next post will be all about the best and worst ads of the game, so consider this a warm up!

Number 1: Geico (Hump Day)

I have always felt that Geico just has the advertising business down. Lets start with the fact that they have continuous campaigns with such great success that extending the length of the campaign is easy. With multiple campaigns to fall back on Geico then has the ability to experiment with new ideas and see what their consumers best respond to.

For example, the "So Easy a Caveman can do it" ad's were a huge hit. While they aired Geico was able to tinker around with ideas for the Gecko and Flo. And as soon as the Caveman became outdated they axed the campaign and moved to the next one. After the Caveman the company used the Gecko and Flo in different settings and that worked enough. In 2013 however the "Happier than...." commercials came about and were also met with success, meanwhile the Gecko and Flo are still seen in and out of the overall advertising campaign.

To sum it up, I think the brilliance behind Geico is their ability to learn and grow continuously from their advertising as well as build their strong list of campaigns to fall back on.

Number 2: AT&T

Finally! A cell-phone provider that doesn't advertise about maps! Or is not constantly comparing themselves to their top competitor!
When AT&T finally moved to the "It's Not Complicated" series of ads I was beyond happy. No more comparison ads between Verizon and AT&T. This is one of the reasons that they earned the number two spot on my list. Verizon still to this day uses the comparison maps, year-in and year-out. Personally this raised my interest in all things AT&T, who wants to own a phone through the company that is constantly comparing themselves to others. After a certain point comparisons just feel like someone is trying to make up for a lack of something else.
The main reason for the number two spot however, was the simplicity of the ad. They take one idea, and make it seem so logical to buy AT&T's services because of that one reason, which is usually unrelated to the phone industry (the above commercial references a bunch of grapes becoming raisins and the cutest kid ever). The best part is every commercial is a bunch of kids and Beck Bennett not talking about phones. The use of logic to prove how one thing is better than another, and then relate that one thing to the AT&T service is great. And there is just enough humor or emotion (depending on the commercial) to draw in the average consumer.

Before the my third pick it should be known that I am a big dog guy. I even have a pooch of my own. Otis the black labrador!

Number 3: Google Nexus 7

When Google created this ad for their new tablet based around the idea of getting home to be with a sick dog I couldn't help but connect with the situation. I have been in the same exact place a few times, and in that moment nothing is more important than the dog, except for how you will get home to see him/her. I think it was a brilliant use of emotion, without really showing emotions. There were no tears, just the situation itself gave off a sobering sadness feeling. Also Google was able to showcase the ability of their technology to bring people together. Considering 47% of households own dogs (Humane Society) this emotional connection had the possibility to connect with a large portion of the US. And I don't know how anyone wouldn't want a Google tablet of some soft by the end, I sure did.

Runner-Up: Chipotle

It was important to include Chipotle in this list but felt it didn't belong in the top 3.
You see, Chipotle created an advertisement based around the fear of processed foods and how they are produced. How big companies lie to us about their products.
The problem with this ad to me, was there emotional connections made with the animals (the chicken being injected and the cow stuck in a box). At the end of this advertisement consumers will either completely understand Chipotle's ideals, or they will want to go vegan.
That is where my problem lies with this ad. A consumer should feel a certain way after the viewing of a commercial. Now I know all consumers are different, but these two reactions are so far apart that Chipotle may face some negative feedback for this ad. I think the commercial was beautifully done, but could have possible negative backlash. That is why Chipotle received the runner-up award!
(Have an opinion on this new ad by Chipotle? Leave it in the comments!)

Best Business Blunders

This week in BBB: JC Penney
I knew that eventually I would have to discuss JC Penney and their current identity crisis. I was trying to stay out of the mess because I wasn't sure what my own opinion was. I can safely say now that I have an opinion. JC Penney made a huge mistake, either way this situation is looked at.
First, they fired their CEO Myron Ullman and hired the man who made Apple retail what it is today, Ron Johnson. If Ron Johnson was truly who they wanted then they should have kept him to continue his work and see if progress was made. For Pete sake the apology they aired, after firing Mr. Johnson, was put together while he was still the CEO (ABC). How dare you use an apology advertisement he created for a completely different purpose, trying to make up for all of your mistakes as a board of directors.
In my opinion there are two ways to look at this problem. Option A would be to not fire your original CEO, while option B would be to stick with your new CEO. By following one of these two options JC Penney wouldn't have had to apologize for their mistakes. An apology which we all know was just awkward. Not only that but a constant shifting of your CEO, your leader, just leaves everybody wondering what is really going on behind closed doors and who JC Penney as a company.
Now what is JC Penney doing you ask? Destroying all of Mr. Johnson's work (BusinessWeek). Again showing that they don't know who they are.

So what is the lesson learned?
You should never have to make an apology to your consumers. That is the lesson I pull from this mistake, but this lesson applies to so many companies today it's embarrassing. From social media flops to quality issues to advertising misfires, companies today are apologizing so often its hard to keep track of it all. A company should think of any and all consequences before an action is taken, just simple common sense.

Thanks again for the interest!

AO