Indeed, it is really hard to image there comes a time guanxi in China cannot be monetized. Here is the case.
Ms C and his busband were senior staff of two state-owned enterprise. Ms C retired a few years ago to take care of her daughter. Ms C got a very good guanxi with senior officials from Telecom authority and the cultural and broadcasting authority. With her guanxi, she even could build connection with Hong Kong Tycoons and elites.
Under her possession, she got licences in ICP, ISP, VoIP and etc, which are mouth-watering by foreigners. However, after years' effort in business sectors, she found herself ran out of energy with no profit and no prosperity.
What's going wrong here?
Is it merely a managerial problem? Yes, but just partial. Her basic target is to attract foreign investors to fund up her business. Her business never gets a long term planning and a roadmap. Everything in her business is just a mock-up and a logistic. Some products after being fully developed were never launched since she just wanted a showcase.
Honestly, it leaves the investors a lot of questions. Should we fund her up to build a real business? Would she be a good business owner? If you are a foreign investor, will you build your second home in China with her?
What is critical here?
It is a regulatory problem. Managerial problem can be easily overcome but not for regulatory problem. Thousands of rules keep foreign telecom related operator away. How to overcome this problem?
Thursday, July 8, 2010
Another AR example from IKEA
Again, as discussed before, something that is up and coming! Augmented Reality. This is the 2nd time I show you an example. Here is another example from IKEA.
Wednesday, July 7, 2010
McKinsey advocating second home in China
Perhaps, you cannot hear that. But I do. I can sense a chant of “China, China, China” in global business arena even though there are a lot of downsides. Yes, not just me. McKinsey, the famous global business consultant, advocates an idea of taking China as second home for businesses.
Spurred on with its rapid evolution, China is now considered as the global battlefield for sectors, like consumer electronics, semiconductors, and electricity transmission equipment, on which global winners are determined. McKinsey describes the way of some multinational companies “side betting” by letting their rivals take risk on China’s booming and regulatory imperfect. McKinsey warns if multinational companies do not start building second home in China, they would not keep their success. In other words, multinational companies need to commit themselves to China and make long-term “guanxi” (a term which is more than relationship and connection) there.
McKinsey is striking up a discordant tune to the concerto playing by chambers of commerce from America and Europe. Indeed, RMB rate control, Google-China tension, new regulation on “indigenous innovation” and antimonopoly issue on Coca-cola acquisition of Huiyuen Juice, all those issues were discussed on the table by the chambers. Mainstream view is formed multinational companies are likely not welcome by China.
I think McKinsey’s argument is strong. It cites two examples, piano and auto markets in the China, to illustrate how attractive the markets are. However, what is the value proposition for a second home? Merely revenue?
I agreed with the point that it should not be a measure to gain revenue but a measure to survive in the market and not to be demolished by competitors.
There are five qualitative metrics to measure the success of second home in China:
1. Time spent in China
2. Visibility into China
3. Chinese representation in the senior team
4. Knowledge of Chinese customers and suppliers
5. Relationships with government leaders and regulators
傳統零售：電子商務係魔道？
人皆說中國網絡市場爆發力驚人，潛能無限載，人人著了魔一般！不過，對傳統零售業來說，這是魔道，不是人人願意入道的！
據統計，截至2010年5月底，2009年度連鎖百強企業中已有31家開展了網上零售業務，但是整體銷售額佔在國內網購市場仍不足1%，可見傳統零售仍然很有戒心，或者不願意改變商業的模式，去面對新的競爭。
從商業管理的角度去看，「誘因」扮演一個重要的角色。傳統零售商不願意改變現行的模式，因為現行的仍有錢賺，而相對電子商務來說，利潤比較薄。
有記者比對過國內一些傳統零售商和電子商務的價格，發現傳統零售就算有自己的網站，也不熱衷靈活的價值運用，目的是要保護現有的利潤。舉個例子說，同一款的電視機，傳統零售要統一網上和商舖的價和，售3100元，但電子商務網站只售2699。
這種價格的策略是可以理解的，但卻削弱了傳統零售在這個範疇的競爭力。傳統零售仍然有優勢，老實說，買一台電視，我會跑到商舖裡看看實物，才會下決定。當然，重點在那「決定」，我會選擇便宜一點的網上購買，還是即時下決定在商店裡完成購買行為。
這一年多以來，國內的網上購物起了很大的變化，網路賣家實名制、網站工商登記註冊等新規定，再加上七月一日起《網路商品交易及有關服務行為管理暫行辦法》實施，中國政府有意識地邁向更嚴格的規管，且有稅收的意味，讓國內電子商務百花齊放的日子，很快會成為過去。
將來會如何？在英美兩地，排列網上購物網站的前十位的，大都是傳統零售轉身而成的網上商店，這勢將成為中的新趨勢，連鎖百強中蘇甯、國美、歐尚、翠微大廈等可能會跑出。只是在政策的協助下，讓這些百強繞過真正的競爭而跑出，對消費者未必有利。
不過，話說回頭，網上商城不算小規模的投資，以一個全國性的網站計，初步的投資要3000萬人民幣，以後還要繼續投入。但同一筆的投資，放在實體的商舖上，兩三年可以回本，難怪連鎖百強仍只是集中實體的業務。
據統計，截至2010年5月底，2009年度連鎖百強企業中已有31家開展了網上零售業務，但是整體銷售額佔在國內網購市場仍不足1%，可見傳統零售仍然很有戒心，或者不願意改變商業的模式，去面對新的競爭。
從商業管理的角度去看，「誘因」扮演一個重要的角色。傳統零售商不願意改變現行的模式，因為現行的仍有錢賺，而相對電子商務來說，利潤比較薄。
有記者比對過國內一些傳統零售商和電子商務的價格，發現傳統零售就算有自己的網站，也不熱衷靈活的價值運用，目的是要保護現有的利潤。舉個例子說，同一款的電視機，傳統零售要統一網上和商舖的價和，售3100元，但電子商務網站只售2699。
這種價格的策略是可以理解的，但卻削弱了傳統零售在這個範疇的競爭力。傳統零售仍然有優勢，老實說，買一台電視，我會跑到商舖裡看看實物，才會下決定。當然，重點在那「決定」，我會選擇便宜一點的網上購買，還是即時下決定在商店裡完成購買行為。
這一年多以來，國內的網上購物起了很大的變化，網路賣家實名制、網站工商登記註冊等新規定，再加上七月一日起《網路商品交易及有關服務行為管理暫行辦法》實施，中國政府有意識地邁向更嚴格的規管，且有稅收的意味，讓國內電子商務百花齊放的日子，很快會成為過去。
將來會如何？在英美兩地，排列網上購物網站的前十位的，大都是傳統零售轉身而成的網上商店，這勢將成為中的新趨勢，連鎖百強中蘇甯、國美、歐尚、翠微大廈等可能會跑出。只是在政策的協助下，讓這些百強繞過真正的競爭而跑出，對消費者未必有利。
不過，話說回頭，網上商城不算小規模的投資，以一個全國性的網站計，初步的投資要3000萬人民幣，以後還要繼續投入。但同一筆的投資，放在實體的商舖上，兩三年可以回本，難怪連鎖百強仍只是集中實體的業務。
Tuesday, July 6, 2010
賤價必勝?!愛揮劍自宮的中國B2C電務市場
記得在UC Berkeley 一個課程進修時，Professor Ho給我們在價格戰上上了一個課，在價格戰線上，貨品價物長遠只有向下，沒有向上。這給我一個當頭棒喝，避免價格戰，是教授的忠告。
可惜，中國市場就是一個殺戮戰場，不論你是B2C、B2B、傳統企業，或者電子商務，價格血戰連場，那陣血腥味，中人欲嘔。
無怪的，在一項最新調查顯示，中國2010年度單是網絡市場交易總額就已經突破了一千億元人民幣。要搶奪市場，傳統智慧就是打價格戰，以本傷人，看誰人能最後站在戰場上不倒下來。有誰會細想，留下殘障的身體仍有力持久下去嗎？
最新有一個報導各映這個事實：
針對低價競爭的情況，某國內資深電商從業者感慨到，“不僅電子商務領域是這樣，其他領域也一樣，如中國手機，一通價格血戰下來，不管是戰鬥機還是轟炸機，都失去了應得的先機。還有大家熟悉的三鹿奶粉，一度因價格便宜受到消費者歡迎，最後吃出了三聚氰胺，大家又開始花10倍價錢去買國外的進口奶粉。這些鮮活的例子告訴我們，一味的價格戰只能遭到市場的質疑，最終使企業走向黑洞。”某國外專家在一次論壇中則講到：“目前中國企業中有很多都在採用價格戰來增強用戶的粘稠度，尤其是電子商務企業，競爭的方式過於單一，僅停留在價格戰的階段，而忽視了貨品品質、物流、服務在提升競爭力方面的重要作用。”
誠然，價格是最即時見成效的武器，就像核彈一樣，推倒整個市場。問題在於能持久嗎？
其實，貨品最終的決戰在於自己的質素和服務，這才是商界正道。可惜「葵花寶典」就在眼前，又有那個能抵擋魔力，不揮劍自宮，以捷徑稱霸江湖呢？
可惜，中國市場就是一個殺戮戰場，不論你是B2C、B2B、傳統企業，或者電子商務，價格血戰連場，那陣血腥味，中人欲嘔。
無怪的，在一項最新調查顯示，中國2010年度單是網絡市場交易總額就已經突破了一千億元人民幣。要搶奪市場，傳統智慧就是打價格戰，以本傷人，看誰人能最後站在戰場上不倒下來。有誰會細想，留下殘障的身體仍有力持久下去嗎？
最新有一個報導各映這個事實：
針對低價競爭的情況，某國內資深電商從業者感慨到，“不僅電子商務領域是這樣，其他領域也一樣，如中國手機，一通價格血戰下來，不管是戰鬥機還是轟炸機，都失去了應得的先機。還有大家熟悉的三鹿奶粉，一度因價格便宜受到消費者歡迎，最後吃出了三聚氰胺，大家又開始花10倍價錢去買國外的進口奶粉。這些鮮活的例子告訴我們，一味的價格戰只能遭到市場的質疑，最終使企業走向黑洞。”某國外專家在一次論壇中則講到：“目前中國企業中有很多都在採用價格戰來增強用戶的粘稠度，尤其是電子商務企業，競爭的方式過於單一，僅停留在價格戰的階段，而忽視了貨品品質、物流、服務在提升競爭力方面的重要作用。”
誠然，價格是最即時見成效的武器，就像核彈一樣，推倒整個市場。問題在於能持久嗎？
其實，貨品最終的決戰在於自己的質素和服務，這才是商界正道。可惜「葵花寶典」就在眼前，又有那個能抵擋魔力，不揮劍自宮，以捷徑稱霸江湖呢？
Facebook遊戲注定失敗?! 遊戲商要小心自己的投資
朋友S寄來Facebook(FB)遊戲，希望取一點意見。多年來，朋友S專注國內遊戲市場，由C++開始，澳門起飛時，曾經在賭博遊戲上下過功夫，但經過多年，始終未能闖開新世界。FB可會是新希望？嗯，我的看法是危機四伏…
遠的不看，先看最新消息。Yahoo將於今天與虛擬遊戲商Offerpal宣布合作，作為Yahoo向遊戲業進軍的重要一步。早在今年五月，FB與FarmVille的開發商Zynga鬧翻後，Yahoo立即拉攏FarmVille加盟Yahoo Game，Yahoo的意圖已經後明顯，希望糾正過去的錯誤。不過，目前Yahoo要對FB造成威脅，尚有一段距離。
FB以火燒的速度，成為網上遊戲業的巨擘，這是不爭的事實。問題在於FB對於遊戲業的投入度，一直盛傳FB的CEO Mark Zuckerberg對遊戲業務不感興趣，讓遊戲業務不獲重視，這是對遊戲商一大重擊。
業界普遍認為，FB作為社交網的龍頭，正重蹈Yahoo Game當年的錯誤，沒把遊戲業務當作一回事，結果被Real Networks和BigFish等坐大。Hi5 總裁Alex St.John直言，FB的失敗是無可避免的。據網流監察機構comScore的統計，Zynga去年的流量已經超越了Yahoo Game。
問題真正在於FB的遊戲業務，是否有前景，因為公司不專注在這業務上，只在發展FB平台為一個多用途的社交網。
當然，我不排除很多同業心感酸溜溜，乘機踏FB幾腳。有人話，FB遊戲勢將宣布全面失敗。我就覺得太誇張，忽略FB對網民心理上engagement的元素。FB遊戲有多差勁，也不致於如Yahoo Game咁，只餘下公公婆婆在玩。
遠的不看，先看最新消息。Yahoo將於今天與虛擬遊戲商Offerpal宣布合作，作為Yahoo向遊戲業進軍的重要一步。早在今年五月，FB與FarmVille的開發商Zynga鬧翻後，Yahoo立即拉攏FarmVille加盟Yahoo Game，Yahoo的意圖已經後明顯，希望糾正過去的錯誤。不過，目前Yahoo要對FB造成威脅，尚有一段距離。
FB以火燒的速度，成為網上遊戲業的巨擘，這是不爭的事實。問題在於FB對於遊戲業的投入度，一直盛傳FB的CEO Mark Zuckerberg對遊戲業務不感興趣，讓遊戲業務不獲重視，這是對遊戲商一大重擊。
業界普遍認為，FB作為社交網的龍頭，正重蹈Yahoo Game當年的錯誤，沒把遊戲業務當作一回事，結果被Real Networks和BigFish等坐大。Hi5 總裁Alex St.John直言，FB的失敗是無可避免的。據網流監察機構comScore的統計，Zynga去年的流量已經超越了Yahoo Game。
問題真正在於FB的遊戲業務，是否有前景，因為公司不專注在這業務上，只在發展FB平台為一個多用途的社交網。
當然，我不排除很多同業心感酸溜溜，乘機踏FB幾腳。有人話，FB遊戲勢將宣布全面失敗。我就覺得太誇張，忽略FB對網民心理上engagement的元素。FB遊戲有多差勁，也不致於如Yahoo Game咁，只餘下公公婆婆在玩。
Friday, July 2, 2010
No software giants should make handset other than Apple?! What a suggestion!
A friend from Google showed me his Nexus One (almost a year old). His mobile's Android OS version is still 2.0. Asking why he didn't upgrade his OS to the latest, I got a wierd answer that he didn't get time to read all the email from Google. There are too many initiatives in his company. Ha ha ...
Perhaps, Nexus One may be the last Google branded mobile. It is true. Google is not a good handset maker according to my friend. In the deal with HTC in Nexus One, what Google is pursuing is a perfect mobile. You may check it out from Nexus One. It gets a perfect shell which HTC said they would not produce any products in that manner. It is too expensive.
Recently, I read an article which is close to what I am thinking of.
Why software giants—except Apple—should not be making handsets
While both Microsoft and Google excel in their own spheres, the one thing they should steer clear from are screws and screens.
Sales of Apple’s iPad and iPhone 4 have been robust as expected, but Google’s Nexus One failed to meet expectations and Microsoft is raising the white flag on its teen-targeted Kin less than two months after its heavily marketed launch. Perhaps the lesson is stick to your knitting, and in the case of Google and Microsoft, it may behoove them to promote their respective operating systems—and continue to grow their mobile search and mobile advertising revenues—rather than try to be handset manufacturers.
“Certainly one issue Apple doesn’t face that Google and Microsoft do face is that Apple is not looking to license its operating system, so there is no conflict between its needs and licensees’ needs, while both Google and Microsoft do have that conflict,” said Ross Rubin, director of industry analysis at the NPD Group, Port Washington, NY.
“Both decided to stay out of the way to a certain extent—Google decided to pursue direct distribution and avoided carrier deals, and the Nexus One sales suffered due to not having access to those strong sales channels,” he said. “The Kin had a specific target user, teens and twenty-somethings, as opposed to Windows Phone 7 devices, which should have a broader target and access to an app store.
“Microsoft and Google had some mixed motivation in terms of not wanting to compete directly with licensees of the operating systems that they promote.”
The iPhone outshines Nexus One, Kin
While its Android operating system is an undisputed success, direct sales of Google’s Nexus One have not met expectations—a sign that round one of the handset distribution battle has gone to the carriers.
With both Sprint and Verizon Wireless refusing to offer the Nexus One at a subsidized price, Google has had to rely on its direct-to-consumer ecommerce portal—selling the smartphone at $529 a pop—and on distribution through T-Mobile USA, the No. 4 carrier nationwide. That strategy has not enabled the Nexus One to live up to the hype (see story).
Nexus One sales are said to be poor.
Reports indicate that Google sold roughly 135,000 Nexus One phones in their first 74 days on the market. In comparison, Motorola sold 1.05 million Droids in the same timeframe.
Kin sales have not met expectations either.
The Yankee Group estimated that Kin sales were above 1,000 units but did not surpass 10,000 units over the two-month period since its launch. Other sources speculate that sales could have been as low as 500.
In comparison, Apple sold 1.7 million iPhone 4 units within three days of the device's launch. Since this number included pre-orders, sales have slowed down since then.
On the other hand, sales of the iPad are accelerating and have now hit the 2-million mark. It took Apple more than 28 days to sell its first million, but only 22 days to go from 2-3 million.
Different core competencies
One of the truisms of marketing is that you get your best business from existing customers, that is, from repeat business. The 80-20 rule states that 80 percent of your business comes from 20 percent of your customers.
Apple’s ability to create buzz around product launches and the magnetic hold that it has over its customer base are currently unrivaled.
“Apple has been successful thanks to an intuitive user interface, smart marketing and to some extent a strong brand halo effect,” said Dmitriy Molchanov, analyst at Yankee Group, Boston. “Apple's specialty is in building reliable, stable and intuitive user-interfaces.
“Google specializes in cloud-based services,” he said. “It wants to get consumers more familiar with interacting with the cloud.
“With the Kin, and now Windows Mobile 7, Microsoft seems to be building a mobile offering that focuses on social networks and quick, easy interactions with friends.”
With Google’s acquisition of AdMob and Apple’s acquisition of Quattro Wireless and the launch of the iAd network, all three companies are going head to head in the mobile advertising space.
While Google is still the leader in search, Microsoft is showing progress with its Bing search engine, both online and mobile, including a deal with Verizon Wireless. Mobile search is one area where Apple does not have a presence.
Each company has its own core competencies, and there is a fine line between branching out and spreading one’s self too thin.
Google and Microsoft have plenty going for them. In the face of Apple dominating smartphone manufacturing, and now tablet manufacturing, maybe Google and Microsoft should say, “So what?” and continue with their bread-and-butter businesses.
“Apple’s strengths are the vertical integration of hardware software and services, clearly very strong design capabilities, its franchise in digital music and it has perhaps the strongest brand of the three companies,” Mr. Rubin said. “It also has a direct retail channel, so customers can get hands-on and look at how the phone fits into the rest of the Apple ecosystem.
“Microsoft has strong ties with third-party developers—it is sort of in the middle between Apple and Google in terms of the openness of its platform and the extent to which it will allow customization,” he said. “It also has the strongest ties of the three to game developer community.”
In addition, Microsoft has a strong suite of Web services—Windows Live, the Zune music service, Bing and Xbox Live—as does Google.
“Google is the most open of the three, and it has a huge advantage in that it gives away the OS for free,” Mr. Rubin said. “It also has an aggressive release schedule, with two to three major releases per year.
“Its suite of Web services has a somewhat different focus than Microsoft,” he said. “Google is also allowing carriers and OEMs a good degree of leeway in terms of customization, creating a good amount differentiation in the marketplace.”
Not-so-secret strategy
While sales of the Nexus One have been nothing to write home about, there is evidence that it has furthered Google’s agenda anyway.
“Google may have been more successful than critics think,” Mr. Molchanov said. “The majority of Google's revenues come from Google ads, and Google benefits whenever it can get more consumers online.
“It designs products like Android and Chrome OS to get consumers online and to give them the fastest browsing speeds possible while they're there,” he said. “Google's goal with the Nexus One was less about selling devices, and more about getting consumers familiar with mobile browsing and with the Android OS.”
To some extent, Google has been successful executing that strategy.
Android now has 5 percent worldwide market share, which means sales of roughly 14 million units, according to Yankee Group.
To put that number in perspective, iPhone has roughly 15 percent worldwide market share.
“Android's success is far more important to Google than the success of the Nexus One,” Mr. Molchanov said. “A few months ago, Google told Verizon shoppers to buy the HTC Incredible, an Android phone, instead of a Nexus One.
“In Microsoft's case, the Kin's failure should have been foreseen,” he said. “The Kin phone was a by-product of their purchase of Danger, which manufactured T-Mobile's successful Sidekick phones.
“Forcing the Sidekick phone to run a version of Windows CE, pricing the phone like a smartphone and giving it a data plan despite its lack of apps and games was 'akin' to shooting it in the foot.”
Handset or hand-wriging?
So will Google and Microsoft give it another go as an original equipment manufacturer? Will there be a Nexus Two? Will Microsoft to rebound with handsets based on its soon-to-launch Windows Phone 7 OS?
“Google is a software company, not a hardware company,” Mr. Molchanov said. “For that reason, I think Google's future in mobile rests largely on the success of Android.
“Microsoft has invested a substantial sum in Windows Mobile 7 and early looks at Mobile World Congress do look impressive,” he said. “However, at this point, Microsoft is playing catch-up and the advanced OS is several development cycles behind its competitors.
“The launch later this year does look to be a make-or-break moment for Microsoft in the mobile phone space.”
There has been some speculation that Microsoft might come out with a slate tablet based on its new OS.
That might be a better play, because in the smartphone market, it must contend with not just the iPhone and Android devices, but also Research In Motion’s BlackBerry.
“Microsoft now has to compete with two companies that have perfectly wonderful products and operating systems that seem to meet everyone’s needs and even seem to be sufficiently able to address the corporate market,” said Oren Michaels, cofounder/CEO of Mashery, San Francisco. “And there’s a third competitor—RIM.
“Microsoft has typically provided its PC OS to corporate customers and Apple has not, and RIM has typically provided its mobile OS to corporate customers and Apple has not, but Apple is making inroads [into the enterprise market],” he said. “I don’t see Microsoft having an easy time beating Apple or Andorid with the cool factor, so really the company that Microsoft will have to be competing with is RIM.
“At this point RIM owns mobile exchange, so can Microsoft take back control of their own email product? It got supplanted on mobile by RIM.”
Perhaps, Nexus One may be the last Google branded mobile. It is true. Google is not a good handset maker according to my friend. In the deal with HTC in Nexus One, what Google is pursuing is a perfect mobile. You may check it out from Nexus One. It gets a perfect shell which HTC said they would not produce any products in that manner. It is too expensive.
Recently, I read an article which is close to what I am thinking of.
Why software giants—except Apple—should not be making handsets
While both Microsoft and Google excel in their own spheres, the one thing they should steer clear from are screws and screens.
Sales of Apple’s iPad and iPhone 4 have been robust as expected, but Google’s Nexus One failed to meet expectations and Microsoft is raising the white flag on its teen-targeted Kin less than two months after its heavily marketed launch. Perhaps the lesson is stick to your knitting, and in the case of Google and Microsoft, it may behoove them to promote their respective operating systems—and continue to grow their mobile search and mobile advertising revenues—rather than try to be handset manufacturers.
“Certainly one issue Apple doesn’t face that Google and Microsoft do face is that Apple is not looking to license its operating system, so there is no conflict between its needs and licensees’ needs, while both Google and Microsoft do have that conflict,” said Ross Rubin, director of industry analysis at the NPD Group, Port Washington, NY.
“Both decided to stay out of the way to a certain extent—Google decided to pursue direct distribution and avoided carrier deals, and the Nexus One sales suffered due to not having access to those strong sales channels,” he said. “The Kin had a specific target user, teens and twenty-somethings, as opposed to Windows Phone 7 devices, which should have a broader target and access to an app store.
“Microsoft and Google had some mixed motivation in terms of not wanting to compete directly with licensees of the operating systems that they promote.”
The iPhone outshines Nexus One, Kin
While its Android operating system is an undisputed success, direct sales of Google’s Nexus One have not met expectations—a sign that round one of the handset distribution battle has gone to the carriers.
With both Sprint and Verizon Wireless refusing to offer the Nexus One at a subsidized price, Google has had to rely on its direct-to-consumer ecommerce portal—selling the smartphone at $529 a pop—and on distribution through T-Mobile USA, the No. 4 carrier nationwide. That strategy has not enabled the Nexus One to live up to the hype (see story).
Nexus One sales are said to be poor.
Reports indicate that Google sold roughly 135,000 Nexus One phones in their first 74 days on the market. In comparison, Motorola sold 1.05 million Droids in the same timeframe.
Kin sales have not met expectations either.
The Yankee Group estimated that Kin sales were above 1,000 units but did not surpass 10,000 units over the two-month period since its launch. Other sources speculate that sales could have been as low as 500.
In comparison, Apple sold 1.7 million iPhone 4 units within three days of the device's launch. Since this number included pre-orders, sales have slowed down since then.
On the other hand, sales of the iPad are accelerating and have now hit the 2-million mark. It took Apple more than 28 days to sell its first million, but only 22 days to go from 2-3 million.
Different core competencies
One of the truisms of marketing is that you get your best business from existing customers, that is, from repeat business. The 80-20 rule states that 80 percent of your business comes from 20 percent of your customers.
Apple’s ability to create buzz around product launches and the magnetic hold that it has over its customer base are currently unrivaled.
“Apple has been successful thanks to an intuitive user interface, smart marketing and to some extent a strong brand halo effect,” said Dmitriy Molchanov, analyst at Yankee Group, Boston. “Apple's specialty is in building reliable, stable and intuitive user-interfaces.
“Google specializes in cloud-based services,” he said. “It wants to get consumers more familiar with interacting with the cloud.
“With the Kin, and now Windows Mobile 7, Microsoft seems to be building a mobile offering that focuses on social networks and quick, easy interactions with friends.”
With Google’s acquisition of AdMob and Apple’s acquisition of Quattro Wireless and the launch of the iAd network, all three companies are going head to head in the mobile advertising space.
While Google is still the leader in search, Microsoft is showing progress with its Bing search engine, both online and mobile, including a deal with Verizon Wireless. Mobile search is one area where Apple does not have a presence.
Each company has its own core competencies, and there is a fine line between branching out and spreading one’s self too thin.
Google and Microsoft have plenty going for them. In the face of Apple dominating smartphone manufacturing, and now tablet manufacturing, maybe Google and Microsoft should say, “So what?” and continue with their bread-and-butter businesses.
“Apple’s strengths are the vertical integration of hardware software and services, clearly very strong design capabilities, its franchise in digital music and it has perhaps the strongest brand of the three companies,” Mr. Rubin said. “It also has a direct retail channel, so customers can get hands-on and look at how the phone fits into the rest of the Apple ecosystem.
“Microsoft has strong ties with third-party developers—it is sort of in the middle between Apple and Google in terms of the openness of its platform and the extent to which it will allow customization,” he said. “It also has the strongest ties of the three to game developer community.”
In addition, Microsoft has a strong suite of Web services—Windows Live, the Zune music service, Bing and Xbox Live—as does Google.
“Google is the most open of the three, and it has a huge advantage in that it gives away the OS for free,” Mr. Rubin said. “It also has an aggressive release schedule, with two to three major releases per year.
“Its suite of Web services has a somewhat different focus than Microsoft,” he said. “Google is also allowing carriers and OEMs a good degree of leeway in terms of customization, creating a good amount differentiation in the marketplace.”
Not-so-secret strategy
While sales of the Nexus One have been nothing to write home about, there is evidence that it has furthered Google’s agenda anyway.
“Google may have been more successful than critics think,” Mr. Molchanov said. “The majority of Google's revenues come from Google ads, and Google benefits whenever it can get more consumers online.
“It designs products like Android and Chrome OS to get consumers online and to give them the fastest browsing speeds possible while they're there,” he said. “Google's goal with the Nexus One was less about selling devices, and more about getting consumers familiar with mobile browsing and with the Android OS.”
To some extent, Google has been successful executing that strategy.
Android now has 5 percent worldwide market share, which means sales of roughly 14 million units, according to Yankee Group.
To put that number in perspective, iPhone has roughly 15 percent worldwide market share.
“Android's success is far more important to Google than the success of the Nexus One,” Mr. Molchanov said. “A few months ago, Google told Verizon shoppers to buy the HTC Incredible, an Android phone, instead of a Nexus One.
“In Microsoft's case, the Kin's failure should have been foreseen,” he said. “The Kin phone was a by-product of their purchase of Danger, which manufactured T-Mobile's successful Sidekick phones.
“Forcing the Sidekick phone to run a version of Windows CE, pricing the phone like a smartphone and giving it a data plan despite its lack of apps and games was 'akin' to shooting it in the foot.”
Handset or hand-wriging?
So will Google and Microsoft give it another go as an original equipment manufacturer? Will there be a Nexus Two? Will Microsoft to rebound with handsets based on its soon-to-launch Windows Phone 7 OS?
“Google is a software company, not a hardware company,” Mr. Molchanov said. “For that reason, I think Google's future in mobile rests largely on the success of Android.
“Microsoft has invested a substantial sum in Windows Mobile 7 and early looks at Mobile World Congress do look impressive,” he said. “However, at this point, Microsoft is playing catch-up and the advanced OS is several development cycles behind its competitors.
“The launch later this year does look to be a make-or-break moment for Microsoft in the mobile phone space.”
There has been some speculation that Microsoft might come out with a slate tablet based on its new OS.
That might be a better play, because in the smartphone market, it must contend with not just the iPhone and Android devices, but also Research In Motion’s BlackBerry.
“Microsoft now has to compete with two companies that have perfectly wonderful products and operating systems that seem to meet everyone’s needs and even seem to be sufficiently able to address the corporate market,” said Oren Michaels, cofounder/CEO of Mashery, San Francisco. “And there’s a third competitor—RIM.
“Microsoft has typically provided its PC OS to corporate customers and Apple has not, and RIM has typically provided its mobile OS to corporate customers and Apple has not, but Apple is making inroads [into the enterprise market],” he said. “I don’t see Microsoft having an easy time beating Apple or Andorid with the cool factor, so really the company that Microsoft will have to be competing with is RIM.
“At this point RIM owns mobile exchange, so can Microsoft take back control of their own email product? It got supplanted on mobile by RIM.”
Thursday, July 1, 2010
SMS is still the best way to go!
You may think it is really funny to discuss about SMS in this Apps world.
No kidding. The two-way communication may help you. Don't miss it.
Another good article to share.
SMS opens a two-way dialogue between marketer and consumer: 360i
Text messaging is by far the most popular mobile activity after talking, and it is one of the most proven mobile marketing channels, according to digital marketing agency 360i.
SMS is the most universal, given that it is available on just about every mobile phone, from lower-end feature phones to the priciest smartphones. ComScore reports 65 percent of mobile subscribers send text messages, compared to about 30 percent using the browser and downloading applications.
“SMS is incredible in the sense that two-thirds of mobile users are using it,” said David Berkowitz, senior director of emerging media and innovation at 360i, New York. “It is so simple in format but the things you can do with it are amazing.
Text messaging is by far the most popular mobile activity after talking, and it is one of the most proven mobile marketing channels, according to digital marketing agency 360i.
SMS is the most universal, given that it is available on just about every mobile phone, from lower-end feature phones to the priciest smartphones. ComScore reports 65 percent of mobile subscribers send text messages, compared to about 30 percent using the browser and downloading applications.
“SMS is incredible in the sense that two-thirds of mobile users are using it,” said David Berkowitz, senior director of emerging media and innovation at 360i, New York. “It is so simple in format but the things you can do with it are amazing.
find a job for you
“It is the most integrated marketing channel because you can tie it to anything you are doing both online and offline,” he said.
Teenagers are especially drawn to SMS. Pew Internet & American Life Project reports that American teens 12-17 contact peers daily via texting (54 percent) more than any other communication channel, including calling on mobile phones (38 percent), talking face to face (33 percent), instant messaging (24 percent) and email (11 percent).
But SMS’ reach is by no means limited to just American teens. An April 2010 study by Merkle found that 63 percent of U.S. adults 30-39 text, as do 49 percent of adults 40-49.
According to 360i, there are several ways to engage in SMS marketing - branded short codes, shared short codes and in-SMS advertising.
Consumers can send a text message to either a shared or branded short code to get updates or engage with the marketer.
With either form of short code use, the biggest advantage is the integration potential.
SMS callouts can appear in out-of-home marketing, point-of-sale locations, TV, radio, print, online display, email and social marketing.
Marketers can also advertise on SMS ad networks by appending a brief message to content that consumers subscribe to, such as sports alerts from, say, NBC.
The ads can be used for a range of purposes, from building up the marketer’s own SMS opt-in list to driving traffic or engagement to the brand’s mobile Web site or application.
“SMS has the reach and if a marketer wants to do an ad campaign advertising can reach a lot of consumers via mobile and very quickly,” Mr. Berkowitz said.
“Building an opt-in list is key because it becomes a deeper discussion and can make it work for them on a long-term basis.
“Part of the power of SMS is getting consumers to opt-in to have an ongoing message,” he said. That’s where SMS takes a different turn.”
Marketers can use SMS to text content, such as product information, informative tips, polls or trivia questions to their opt-in list.
SMS communications can include links to mobile Web sites, maps for store locators and click-to-call links that lead consumers to retail stores or call centers.
A text message can also connect a consumer to a brand’s multimedia, such as images, videos or ringtones.
As of lately, many retailers – such as Walmart – have been using SMS to push coupons, driving consumers in-store for purchasing.
“SMS resembles email in terms of the potential for a two-way dialogue, providing for a deeper experience,” Mr. Berkowitz said.
No kidding. The two-way communication may help you. Don't miss it.
Another good article to share.
SMS opens a two-way dialogue between marketer and consumer: 360i
Text messaging is by far the most popular mobile activity after talking, and it is one of the most proven mobile marketing channels, according to digital marketing agency 360i.
SMS is the most universal, given that it is available on just about every mobile phone, from lower-end feature phones to the priciest smartphones. ComScore reports 65 percent of mobile subscribers send text messages, compared to about 30 percent using the browser and downloading applications.
“SMS is incredible in the sense that two-thirds of mobile users are using it,” said David Berkowitz, senior director of emerging media and innovation at 360i, New York. “It is so simple in format but the things you can do with it are amazing.
Text messaging is by far the most popular mobile activity after talking, and it is one of the most proven mobile marketing channels, according to digital marketing agency 360i.
SMS is the most universal, given that it is available on just about every mobile phone, from lower-end feature phones to the priciest smartphones. ComScore reports 65 percent of mobile subscribers send text messages, compared to about 30 percent using the browser and downloading applications.
“SMS is incredible in the sense that two-thirds of mobile users are using it,” said David Berkowitz, senior director of emerging media and innovation at 360i, New York. “It is so simple in format but the things you can do with it are amazing.
find a job for you
“It is the most integrated marketing channel because you can tie it to anything you are doing both online and offline,” he said.
Teenagers are especially drawn to SMS. Pew Internet & American Life Project reports that American teens 12-17 contact peers daily via texting (54 percent) more than any other communication channel, including calling on mobile phones (38 percent), talking face to face (33 percent), instant messaging (24 percent) and email (11 percent).
But SMS’ reach is by no means limited to just American teens. An April 2010 study by Merkle found that 63 percent of U.S. adults 30-39 text, as do 49 percent of adults 40-49.
According to 360i, there are several ways to engage in SMS marketing - branded short codes, shared short codes and in-SMS advertising.
Consumers can send a text message to either a shared or branded short code to get updates or engage with the marketer.
With either form of short code use, the biggest advantage is the integration potential.
SMS callouts can appear in out-of-home marketing, point-of-sale locations, TV, radio, print, online display, email and social marketing.
Marketers can also advertise on SMS ad networks by appending a brief message to content that consumers subscribe to, such as sports alerts from, say, NBC.
The ads can be used for a range of purposes, from building up the marketer’s own SMS opt-in list to driving traffic or engagement to the brand’s mobile Web site or application.
“SMS has the reach and if a marketer wants to do an ad campaign advertising can reach a lot of consumers via mobile and very quickly,” Mr. Berkowitz said.
“Building an opt-in list is key because it becomes a deeper discussion and can make it work for them on a long-term basis.
“Part of the power of SMS is getting consumers to opt-in to have an ongoing message,” he said. That’s where SMS takes a different turn.”
Marketers can use SMS to text content, such as product information, informative tips, polls or trivia questions to their opt-in list.
SMS communications can include links to mobile Web sites, maps for store locators and click-to-call links that lead consumers to retail stores or call centers.
A text message can also connect a consumer to a brand’s multimedia, such as images, videos or ringtones.
As of lately, many retailers – such as Walmart – have been using SMS to push coupons, driving consumers in-store for purchasing.
“SMS resembles email in terms of the potential for a two-way dialogue, providing for a deeper experience,” Mr. Berkowitz said.
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