Category Archives: advertising

Fake sales: death by marketing

The papers are full of stories alerting customers that massive discounts in the sales are meaningless because the original prices were highly inflated and only a few items were sold at that price to a few people who got badly ripped off. Even after a 70% discount, the sale price can often still mean an actual 45% mark-up for the retailer (to save you the mental arithmetic, that means some shoppers have actually paid almost 5 times the original price paid by the shop).

A few thoughts:

1) Why is this practice still happening? It is supposed to have been banned. Are the authorities all on holiday?

2) The banks have had several fines now and had to repay billions due to bad selling campaigns, such as in credit card insurance or mortgage protection. How long can it be before a class action against the big retailers using fake discount practices is launched on behalf of the sacrificial customers who paid far too much for something so that many others could get a fair price later under the marketing pretense of a deep discount?

3) How long after that will it be before some of the claimed discounts are enforced on a sensible original price as a punishment?

4) How long will it be before one of the big retailers seizes the obviously vacant moral high ground of playing fair and uses the advantage to blast competitors and seize huge market share. With a struggling economy, the advantage of being first mover could be huge.

5) How long will customers who have been ripped off in this way remember the companies who did it and tend to buy from their competitors instead? Has nobody in their marketing departments ever heard the expression ‘once bitten, twice shy’?

6) Has anyone in these companies done any proper agent-based modelling to study the effect of people delaying or even abandoning purchases because they don’t want to be the sacrificial customer? Many people are struggling financially, and will have huge problems buying their loved ones Christmas gifts. If they have also to worry about the exact timing of purchase to make sure they don’t get ripped off, they will struggle even more. In a recession that cause so many people so much misery already, this practice borders on inhuman.

7) Has nobody taken account of the system-wide effects of concentrating  too large a proportion of shopping into a short period such as Black Friday? It cannot possibly be optimal from a logistics point of view. It must also cause severe stress for any employees that have to work extremely hard for short periods and then be unemployed on zero hours for the other days. Again, the system-wide effects can’t be overall beneficial.

9 Why try to rip customers off as much as you can get away with? Why not instead treat customers with respect and offer relatively constant prices with a fair markup and watch your profits go up?

10) Many companies have died because of accountants thinking they were being cleverer than reality shows when their company eventually dies. Will the biggest cause of corporate demise be death by accountant or death by marketer?

Sainsbury’s marketing have lost the plot

This one is more of a rant against poor marketing, and isn’t about the future.

I won’t mention names, but I know a few marketing chiefs who think their staff are largely a waste of space. I don’t have any experience of working with Sainsbury’s marketing though so only have experience as a customer as evidence one way or another.

I am sure someone thinks their new campaign is fantastic. Lets run a TV campaign telling everyone that if they could have got stuff cheaper elsewhere, we will give them a voucher for the difference. It worked well for John Lewis didn’t it?

Well, yes it did, but John Lewis did it right. You did it the opposite of right.

P3

So, if we’d shopped in one of their competitors, we would have paid less.  But they are kindly ‘making it this easy to claim the difference back’. So, if we are still dumb enough to go back to Sainsbury’s soon, knowing we had been overcharged, and remember to take this voucher with us, we can ask for a refund of the overcharge, but only as a discount of our next purchases, which presumably, being a similar basket, will also be overcharged, so we’ll get another voucher and be locked in forever into a cycle of being overcharged and having to juggle vouchers and keep shopping there to get a fair deal. But it is only £1.31, (it was only a small top-up shop of around £20) so we’ll cut our losses and shop in Tesco’s again, where according to Sainsbury’s, we’ll presumably save even more than that every time, since we normally pay rather more than £20.

Not quite John Lewis is it? They are ‘never knowingly undersold’. If they find a competitor would have charged less, they will charge you that or less, at least that’s what I have always assumed. Not give you a voucher that you have to take back and get a discount of another overcharged shopping trip.

Sainsbury’s, you are not being clever, locking people happily into forever shopping there. First, you are telling them you overcharged and then secondly, instead of just deducting it at the checkout at the time which would be easy and fair, you are making people additionally jump through hoops before you’ll give them a fair deal, while telling them where they can get one right away. Not clever. Not at all clever.

 

Casual displays

I had a new idea. If I was adventurous or an entrepreneur, I’d develop it, but I’m not, so I won’t. But you can, before Apple patents it. Or maybe they already have.

Many people own various brands of pads, but they are generally expensive, heavy, fragile and need far too much charging. That’s because they try to be high powered computers. Even e-book readers have too much functionality for some display purposes and that creates extra expense. I believe there is a large market for more casual displays that are cheap enough to throw around at all sorts of tasks that don’t need anything other than the ability to change and hold a display.

Several years ago, Texas Instruments invented memory spots, that let people add multimedia to everyday objects. The spots could hold a short video for example, and be stuck on any everyday object.These were a good idea, but one of very many good ideas competing for attention by development engineers. Other companies have also had similar ideas. However, turning the idea around, spots like this could be used to hold data for a  display, and could be programmed by a similar pen-like device or even a finger touch. Up to 2Mb/s can be transmitted through the skin surface.

Cheap displays that have little additional functionality could be made cheaply and use low power. If they are cheap enough, less than ten pounds say, they could be used for many everyday purposes where cards or paper are currently used. And since they are cheap, there could be many of them. With a pad, it has to do many tasks. A casual display would do only one. You could have them all over the place, as recipe cards, photos, pieces of art, maps, books, body adornment, playing cards, messages, birthday cards, instructions, medical advice, or anything. For example:

Friend cards could act as a pin-board reminder of a friend, or sit in a wallet or handbag. You might have one for each of several best friends. A touch of the spot would update the card with the latest photo or status from Facebook or another social site. Or it could be done via a smart phone jack. But since the card only has simple functionality  it would stay cheap. It does nothing that can’t also be done by a smartphone or pad, but the point is that it doesn’t have to. It is always the friend card. The image would stay. It doesn’t need anything to be clicked or charged up. It only needs power momentarily to change the picture.

There are displays that can hold pictures without power that are postcard sized, for less than £10. Adding a simple data storage chip and drivers shouldn’t add significantly to cost. So this idea should be perfectly feasible. We should be able to have lots of casual displays all over our houses and offices if they don’t have to do numerous other things. In the case of displays, less may mean more.

Flat lenses – oozing potential

Lenses used to be curved. Not in the future thanks to Harvard scientists: https://www.seas.harvard.edu/news-events/press-releases/flat-lens-offers-perfect-image and http://pubs.acs.org/doi/abs/10.1021/nl302516v.

Ht http://nextbigfuture.com/ for making me aware.

Flat antennas aren’t new per se, phased array radio antennas have been around decades, but this is the first optical flat lens I am aware of. Theirs is pretty damned clever!

They are already looking at applications such as flat microscope objectives, and have probably covered most of the biggest opportunities. But just in case, and researchers do occasionally miss some opportunities, here are a few for free:

Kite telescopes

NASA are currently flying a 747-based telescope, chucking out huge quantities of water vapour into the high atmosphere, contributing to global warming to take over from their space shuttles. Ironic that such a warmist organisation should do that, but there we go. A large flat surface telescope could presumably be made into a high altitude kite, albeit one that needs a little engineering. And it wouldn’t add to stratospheric water vapour, or even add CO2.

High altitude telescopes could be used for ground imaging as well as space of course, and there would be many commercially viable businesses from this root, as well as military surveillance of course.

Smart glasses and contact lenses

I would like a pair of glasses that record everything I look at. Flat surface cameras would allow this. Glasses are much bigger than my pupil, so they could allow much higher resolution, so I’d be able to see at very high magnification without having to use binoculars. I’d also be able to see infrared, microwaves, see where the strongest cellphone signal is, enable a whole new kind of fashion using different spectra, add to augmented reality hugely by using the infrared channel to show real as well as digital auras. Wow, can’t wait for these! I am playing Assassin’s Creed again, and this is Eagle Sense and then some.

Of course, active contact lenses could also use this tech and offer intuitive optional zoom. I would see the world as normal, but by trying to focus on something in the distance, it would zoom in automatically. There have only been a few updates to my original active contact lens idea from 1991, http://www.futurizon.com/inventions/activecontactlensmay91.pdf but this will be another generation for its 21st anniversary.

Credit card cameras

The smartphone is causing the decline of standalone digital cameras. Digital jewellery will cause the decline of smartphones, but one of the things we still needed them for is the camera. Not any more. A simple credit card camera would work fine. Or maybe even a wristband could be used. Flat cameras will hasten the decline of smartphones.

Smart posters

If they can be printed cheaply, cameras could be built into much of the urban environment. Any poster could have video capture and storage built in, powered by solar, with some comms added too. What and who it sees could direct what it displays. Sure, you can do all that and then some with augmented reality, but augmented reality is a whole load of additional functionality that lives happily alongside other stuff, and doesn’t necessarily replace everything. Posters could be the next wave of Big Brother or the next wave of advertising. Or both.

Teletubby T-shirts revisited

When the Teletubbies were still new, I suggested that we’d be able to make clothes with video panels in using polymer screens. Teletubby t-shirts. Flat panel cameras would allow these to be two way. They could display images but also act as a cameras. They could link to cameras in other people’s t-shirts. You could have a camera on your back that links to the video image on your front, making you appear to have a big hole through you.

Thought recognition and smart microwaves

Wired carries another interesting article on brain wave recognition of PINs via the headsets used to play computer games. Old stuff in idea terms perhaps but it’s always nice to see practice catching up. http://www.wired.com/threatlevel/2012/08/brainwave-hacking/

It seems obvious that this could work nicely with the flat lens idea. A flat surface could image the electrical activity in the brain from a greater distance instead of having to use a helmet.

It would also be possible to put flat cameras on the inside surfaces of microwave ovens, looking at the food to see where the hot spots and cold spots are, so that the microwave beams could be directed better to the areas needing heated.

I think that’s enough for now.

Are advertising and Apple expenses we can do without?

If you wage war with someone and he gets a bigger gun, you feel pressured to get one too. It’s the same in the war to take your money. If everyone else spends a fortune on advertising, you are likely to feel forced to do so too. But it costs, heavily, and those costs ultimately have to be recovered in higher prices.

When you click on an ad on a website, an advertising company somewhere typically gets about £0.50. That 50p plus has to be recovered when you buy the product, but many of the clicks are ineffective, and there are other expenses in the whole chain apart from the actual click fee (the seller’s own staff, banking costs, accountancy, management etc). Whether you even notice ads or have ever clicked on one, the money you hand over nevertheless subsidises a great many ads, and the ultimate price you pay is much greater than the price that would be needed without advertising.

Nothing new there, but advertising has become a significant and unavoidable extra cost along with taxes and banking fees (and parking charges if you buy in town). You don’t get a choice whether to pay extra to buy via an advertising route or get it cheaper by somehow buying direct. Add up all the web ads, junk email, text messages, paper junk mail, newspapers and magazines, TV and radio advertising, and the whole advertising mark-up is big.

Advertising doesn’t just increase costs. With the exception of some wonderfully entertaining ads, many involving meerkats, adverts waste our time too. Count up all the hours people waste fast forwarding over the add breaks or even sitting through them, and consider the significant personal stress directly resulting from the irritation they cause, that may have a small but finite impact on health. Add to that the extra demands on landfill from the paper junk mail, plus the wasted time opening and sorting the waste. The negative impact on our lives, the environment, and on  the overall economy is vast. Sure, the ad industry creates jobs, but jobs in advertising don’t generate wealth (though there are obviously cash flows between regions). Like banking and the public sector, advertising is a drain on resources. It syphons money from the productive economy and impoverishes us. 

On the other hand, advertising pays for a great deal of what we use on the web, watch on TV or read in newspapers. Some of that wouldn’t exist if the advertising went away, though some would survive via other business models. We’d still have to pay for the things we want to use somehow, so any notional extra fees and administrative inconvenience can reasonably be offset against advertising’s negative impacts.

But even with that offsetting, we really should challenge the cost:benefit ratio in advertising and see if we can find better ways of letting suppliers make potential customers aware of the merits of what they have on offer.

Advertising is only one strand of marketing of course. Marketers know that people want to learn about their new products when they are potentially interested. Context is key. If I have just eaten, I am not interested in marketing from nearby restaurants. If I haven’t, I might be. Using context makes direct marketing possible, especially knowing the location of the user and their tastes and preferences. I will gladly pull information from companies willing to sell me stuff I am interested in, when I want it. They won’t have to pay anyone. Pull marketing is potentially very low cost to both parties, providing the consumer with the info on suppliers’ offerings so they can make an informed decision on what to buy. If we moved entirely to that sort of model, we could greatly reduce the price of everything we buy while saving time and stress.

It is certainly possible to build such a system and make it work well. The technology exists and we’d all be far better off. The really huge problem is that we have bought into the smartphone model, buying iphones, pads or similar, and were taken in so well by beautiful designs and features that we didn’t look under the covers. What we didn’t consciously buy, but bought nonetheless, were devices that only give us access to things on condition that Apple or another big manufacturer gets a big slice of the price, via a variety of mechanisms. A smartphone is perfectly capable of providing exactly the platform we need to save lots of unnecessary spend, but Apple has used its power to extract its own slice of our spend not just at device purchase but throughout its lifetime. Not only has it not let us avoid the expense of advertising, it has added its own extras on top. It has made the situation even worse. Most other companies also use strategies that are designed to get into the most lucrative position in the value chain, expanding the price increase industry.

As I remember it in the beginning, the web was meant to get rid of intermediaries and save costs, making the economy more efficient. What has happened is that layer upon layer of new intermediaries have become adept at selling us products and purchasing systems that allow them to skim off extra slices of revenue for themselves. Anyone working in IT is very familiar with the many layered system architectures, and each layer is another opportunity for some company to take a slice of the revenue passing through. All add ultimately to the purchase price, and companies like Apple win several times because they control several of the architectural layers that their devices are used in. But we are suckers, and keep buying them. Because the extra costs are cleverly hidden or disguised or renamed, we don’t notice them until it’s too late.

I may sound critical of Apple, but all they are doing is to maximise profits for their shareholders, whilst giving customers products they can’t resist. There is no fault there. The same goes for Google or Facebook or any other intermediary. It is the model that we need to change, not companies, who will always do what they can to make the most money. That’s what companies are for.

I’ve written often about cloud nets and digital jewellery nets and the forces of censorship and surveillance and web-based politics and the consequential likely emergence of sponge networks. Check them out in my recent articles list. Freeing ourselves of parasitic companies and advertising is another potential pressure. It may go two ways. We could simply recreate exactly the same problems all over again, just swapping one set of intermediaries for another. Sadly, that is the most likely outcome. History teaches us best that we don’t often learn from history.

But, and this is a long shot, but one that would really help make the world better, we could make devices that people buy, and are then free. No charges for making apps for them, no push advertising, completely open, highly context aware, and high powered, yet completely free to own and use after purchase. Even the comms could be free. They would be capable of everything that you do now, and more. We could use them to talk direct to suppliers and do business with them without anyone else involved. It is even possible to design a free payments and banking system. We could avoid paying anyone except the device manufacturer, once, and the companies we want to do business with using the devices. And with all the time and money we would all save, none of us would mind paying a fair price for such a device. Many people paid via advertising would have to find alternative support models, but the economy would be better off, the rest of us individually would be better off, and the environment would be better off. It is hard to see a downside.

History tells us we will still pick the other system and pay more for a worse life.