Great game yesterday.

The ads weren’t particularly awesome but here are a few I liked.  I thought Career Builder’s “46 banana daquiris” was funny.  Because monkeys like bananas.  I thought Chevy’s “Apocalypse-proof” trucks were a creative twist and appropriate for 2012, even taking a dark but good-natured shot at Ford.

Bud Light Here We Go.  Need to train Moch to fetch the beer!

Volkswagen Fat Dog.  Cute and creative.

Hyundai Think Fast.  Pretty funny and actually features the product.

I’m on the fence about Clint Eastwood’s Chrysler ad.  I really liked their’s last year, and I really like the “Halftime in America” metaphor, but I’m not sure if Chrysler is the best messenger. I think their bailout is still fresh in everyone’s mind, and makes the bootstrapping/innovative/optimistic/self-reliant message of this ad seem hypocritical.  What do you think?

Ferris Bueller in a CRV didn’t do it for me.  Nor did Seinfeld, Uncle Jesse, the Coca-Cola bears, or even my usual fave the E*Trade baby.  But these were some of the worst:

Cars.com Confident You.  Good idea, not well-executed.

Pepsi King’s Court. Meh. Does Elton John need money?

-Nick

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Is RedStar Worldwear a Scam?

On a recent Southwest flight, I found a free $500 gift card for a company called RedStar Worldwear in my in-flight magazine.  Obviously too good to be true (right?), but certainly worth looking into.  What’s the catch? I wondered.

RedStar Worldwear

If you visit their website, you’ll see they sell sunglasses and watches.  The prices typically range from $100-200.

The Fine Print

Each free $500 gift card carries a 9% service fee.  This means if you were to order the $210 sunglasses shown above using your gift card, it would cost you $18.90 to get them delivered.

According to RedStar, the 9% service fee covers “USPS First Class delivery, processing and handling, and general overhead which includes; customer service, order processing, warehousing, labor, cost of goods and materials, profit, and marketing.”

See, they’re not hiding anything.  If the company can make money selling $200 sunglasses for $19, they’re not $200 sunglasses.  I don’t think anybody would be fooled into thinking they’re getting some amazing deal.

Does that make it a scam?  I don’t think so.

The business model (according to them):

“We are providing this offer to Gift Card Holders to create a buzz and to get the word out about our High Quality and cool sunglasses and watches.

Your returned comment cards that are provided to you along with your new sunglasses also are helping us determine the most popular styles and feature for the Sunglasses we will be retailing, starting in the state of California.

*Because our product quality compares so favorably to other national brands that sell at, or for more than, our proposed selling prices; we are planning to open up one hundred Brick and Mortar retail outlets to sell these products at our proposed Retail pricing.”

Pretty clear the above was written by someone speaking English as second language.  I would be surprised if we ever see a RedStar Worldwear retail location (but I’ve been surprised before).  Also curious why their website says “not available in California” if that is where they plan to start their retail empire.

The business model (according to me):

1. Buy cheap sunglasses.
2. Position them as a premium product and pretend to charge premium prices.
3. Offer customers a 91% discount so they think they’re getting a great deal.

Gimmicky? Yes.  Distributing free $500 giftcards? Actually pretty creative marketing.  Scam? No. (unless they don’t actually ship the product — I didn’t place a test order)

My Advice to Customers

Go ahead and shop with RedStar if you want, but be aware you get what you pay for.  Gas station sunglasses sold in a creative way.

My Advice to RedStar

I think it might actually be more effective to use a lower amount on the gift cards, like maybe $50.  $500 definitely gets the attention but it also makes people more skeptical.  A more “reasonable” amount might generate more orders.

Take control of your online reputation.  You’ve succeeded in creating some buzz, but a lot of it is negative.

Could this marketing tactic be applied to any other business?

-Nick

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Each year, residents of our neighborhood are required to submit a certified backflow prevention device test to the city water department.  This apparently ensures safe drinking water for each building.

The city sends out a list of companies that are licensed to perform the test, and there are usually one or two that advertise locally on the mailboxes.

Essentially the testing companies are selling a commodity.  No one cares how the test gets done, just that it gets done as cheaply as possible so their water doesn’t get shut off.  So I would expect to see a race to the bottom in terms of pricing and a lot of transparency, but that isn’t always the case.

The rates are usually $35-45, and I think it must be pretty easy money.  There are 96 units here.  If you could capture that audience with a bargain rate of say $30, one tester could make $2880! Not bad for a day or maybe two day’s worth of work.  Hmm maybe I should get a backflow tester’s license…

So here’s a lesson in marketing.  Compare these two ads posted on the mailboxes.  The first is pretty basic.

Here’s my number, here’s my availability, etc.  But Mr. Hamlin makes one critical error: “My prices remain the same.”  That’s great only if you’ve used his service before and can remember what he charged.

The second ad (which was posted a day or two after the first) takes great advantage of this mistake:

The second ad is far superior.  They come right out and say how much they are going to charge ($35) AND they insinuate that the other company is charging $75.  Love it.  Who know’s what the other guy’s price is?  Maybe it’s $25, but because he didn’t say, now everyone thinks it’s $75.

The AAA Backflow ad also is awesome because they include:

• Both local and toll-free phone numbers
• An email address — fantastic
• The option to book your appointment online through their website — because who uses the phone anymore?
• A testimonial from a local resident — awesome!
• Tear off mini-flyers with all the pertinent information — excellent idea

Despite their first-mover advantage and laminated paper (which was a nice touch), Tri-Valley Backflow got owned by the superior marketing efforts of AAA Backflow.

-Nick

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These days a lot of big websites have big advertisements that either pop up or take up most of the “above-the-fold” real estate when you first load the site.  Annoying, but I understand.

What I don’t understand is that 99% of the time, there is an option in the corner to “skip this ad.”  Ads are a fact of life.  Some are entertaining, some are funny, others aren’t.  I’m a marketing major and I make my living from them.  I get it.  But given the option to skip an ad, I’ll take it every time.

I am a ninja when it comes to finding the button that makes the ad close.  And my guess is you are too.  I never even have time to see what the ad is for, because I know there will be an option to get rid of it in the upper right corner.  It probably takes less than a second.

Does anyone sit there patiently waiting for it to go away on it’s own?  How long does it last?  5 seconds, 10 seconds?  This one I found on Forbes.com was set to last over 20 seconds, an eternity online.

I’d be interested to see some data on the effectiveness of these types of ads.  Are the advertisers charged no matter what, or only for the people that sit through the whole thing?  What percentage of users immediately click the option to skip the ad?

It seems silly to give us the choice to opt out of a website’s revenue channel.  Assuming they don’t get paid unless someone really views the ad, why give customers the easy and immediate choice to skip it.  Skipping gets people to the information they were looking for faster and still cost them the same (zero).  I would be amazed if anyone didn’t skip.

Consider Pandora, an ad-supported business.  If you want to get rid of the ads, you can pay.

Consider Words With Friends, an ad-supported business.  If you want to get rid of the ads, you can pay.

Are these websites shooting themselves in the foot by giving customers the painless option to bypass their revenue source?  I mean you don’t see the gas station giving away free gas just because they thought their customers might be annoyed.

And it would definitely be annoying to have to sit through a TV-style 30-second commercial before loading every website, so hopefully these companies can come up with a better way to make money.

-Nick

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WhatsYourPrice.com is an online dating website where “generous” suitors pay for dates with “attractive” singles.  It’s a business model that really stands out in a crowded space, and is the perfect example of the free market at work.

Customers browse the profile of prospective dates and bid cash for the privilege of taking them out on a first date.  I think once you get over the inherent awkwardness, it makes a lot of sense.

Both men and women can sign up in the “generous” category (but not surprisingly, it’s mostly guys):

What’s Your Price has been the target of criticism, with people calling it borderline prostitution and saying the women are basically hookers.  These people are wrong.

If there’s someone you really want to meet, based on their profile and picture, what’s $50 or $100 in the long run?  If that’s what it takes to stand out from the crowd and get noticed, what’s wrong with that?  It’s pretty much exactly Coca Cola does when it spends the big bucks to buy advertising time.  They can buy the airtime, but if the message doesn’t connect, they won’t sell any soda.  Your WhatsYourPrice bid only buys you a first impression; it’s a foot in the door, and nothing more.  And just like the ad that doesn’t connect, if your winning personality doens’t impress enough for a second date, you lose.

Now if it really works out, you’ll probably want to leave out the WhatsYourPrice details when you tell your grandkids how you met.  But a lasting relationship really is priceless, so I don’t see the problem in spending (or accepting) a few bucks initially to see if it’s worth pursuing.

WhatsYourPrice.com is social economics at its best.

Did You Know?

Their unique dating system is “patent pending” with the US Patent Office: Application No. 61407831.

If necessity is the mother of invention, I would guess the creator of WhatsYourPrice.com was a busy (read: un-attractive) but “generous” (read: rich) individual.  Indeed — enter former Fortune 500 executive and serial entrepreneur founder Brandon Wade:

-Nick

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Microsoft’s browser detection tool could use some help.

“Your browser is not compatible.  We recommend Internet Explorer or Firefox.”

Right.

-Nick

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When I saw this ad for Redline Power Rush!, promising a 7 -hour energy boost, I could only imagine the inevitable battle of product oneupmanship we can look forward to.

Crappy single-blade “why even bother shaving” razors –> Gillette Sensor Excel –> Mach 3 Turbo –> Schick Quattro –> Fusion ProGlide –> however many blades we’re up to now.

It’s only a matter of time before we get to 8 hour energy, 9 hour energy, and beyond.  And some day maybe modern science will make it so we never actually have to sleep.

A couple things make me curious about this 7 hour energy product though.  The first is that it “Contains 2 Servings!”  So… does that mean 14 hours of energy, or merely 2 doses of 3.5 hours of energy?  Also, it comes in a 2.5 ounce bottle, compared to just 2 ounces for the market-leading 5-hour Energy.  If my ratio skills are correct, that’s 125% more power sauce.  Assuming a similar energy-to-ounce ratio, a 2.5 oz dose of 5 Hour Energy would really be worth 6.25 hrs.  (So while slightly bigger, the Redline stuff still is more potent.)

Coming soon: 72 Hour Energy!  Can’t wait.

-Nick

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Storage Wars is a reality show on A&E.   The premise is when people stop paying the rent on their storage unit, it goes up for auction.  Bidders can’t enter the unit, but can look in from the door and get a short amount of time to assess what they think the contents are worth.  Then they try and sell those contents for a profit.  I haven’t seen a single episode, but I believe this program captures the very essence of America.

We had people to make us things
We had people to sell us those things
We didn’t have enough room for those things
We built lots of self storage – Jimmy Buffett, 1986

If you had to explain America to someone who’d never heard of it before, Storage Wars is the perfect place to start.

First, we developed a culture obsessed with the accumulation of stuff, and the economy depends on this obsession.  Consider the “He Who Dies With The Most Toys Wins” bumper sticker, or George W. Bush’s infamous call for us to “go shopping” following 9-11.

But our demand for stuff outpaced our capacity to store it, so some enterprising individuals and companies created the concept of self-storage.  This is capitalism at its finest: discovering a need in the marketplace and offering a win-win solution.  What’s interesting is that self storage is a uniquely American “need”, with nearly 80% of self-storage facilities worldwide here in the US.

We are terrible with money.  Just like our government, we live life in debt.  With an average per capita consumer debt of $8000 (Federal Reserve study 2011), it’s no surprise a certain percentage of storage unit renters eventually fall on hard times and can’t make their payments.

If the renter can’t find more borrowed money, after a few months of borrowed time (3 months in California, where Storage Wars is filmed), the contents of the borrowed space go up for auction.  In this case, enterprising individuals have found a great opportunity to profit on the misfortune of others.  With a keen eye for assessing the value of other people’s stuff, they’ve created their own niche reselling businesses.  Very entrepreneurial of them.

But the culmination of all of this is when this circle of events gets repackaged as entertainment and sold to the same people self-storage-buying public.  A&E has created dozens of new jobs out of nothing in producing Storage Wars, and they profit from selling advertising during the show.  The ads convince people to buy more stuff they don’t need or have room for, ensuring the business continues in perpetuity.  It’s a beautiful thing.

-Nick

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I think skydiving is a good example of an activity you might not want to go bargain hunting for.

Thanks Groupon.

-Nick

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Have you received a letter from Domain Registry of America?  I receive several letters from them a year, saying that my domain names are expiring and that I need to renew them.

Domain Registry of America is an ICANN-accredited domain registrar based in Buffalo NY.  The company itself is a legitimate operation, as far as I can tell, but they employ some very scammy tactics to try and generate business.

Before sending them any money, here’s what you need to know.

Let me show you a copy of my most recent letter.  It’s a good example because it is for this domain, nickloper.com.

The Domain Registry of America letter is designed to scare you into sending them money.  In bold print at the top, they proclaim, “Domain Name Expiration Notice.”  It goes on to say that my domain will expire on August 9th, 2011, and that I risk losing my “online identity, making it difficult for customers and friends to locate [me] on the Web.”

What’s interesting is that they got the date right, but the year wrong.  The domain nickloper.com doesn’t expire until August 9th, 2012.  You can verify that on the “Registration” tab here.  Do your due diligence to avoid being swayed by misinformation and scare tactics.

Next, a word on pricing.  Domain Registry of America is a ripoff; a 1-year renewal for $35 is roughly 3 times what GoDaddy charges.  Their 5-year renewal (“Best Value!”) is more than double what you would pay on GoDaddy, and that’s before adding on any coupons.  Now, I’m not saying it’s a scam to charge more than your competitors, but consumers should know there are other options.

If you get one of these letters, just ignore it.  Remember, whatever company your domain is currently registered at wants to keep your business.  They’re not going to let it expire on you without any warning.  That’s why Domain Registry of America sends their mailers so far in advance, so they can beat your current registrar to the punch.  Don’t be scared.

I’m curious how much money Domain Registry of America makes from these mailers.  Generally, I’d like to think that people who are registering domains are fairly savvy and not very likely to fall for something like this.  But given that I’ve been getting their letters for years, they must make a decent business out of it.

-Nick

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