Archive for the ‘Branding’ Category

Forgive me friends, for I have sinned… it’s been over a month since my last news update on Facebook.

How did it happen? Why did I lapse? Where did my Facebook faith go?

I remember those first zealous days of discovery. The joy of reconnecting with old friends… and co-workers and high school classmates and college buds… and ex-girlfriends, in-laws, business associates, guys I played D&D with while Reagan was still president, friends of friends I met at a party once, and even the siblings of  schoolmates from elementary school.

I proselytized, I evangelized, I got my friends and family to join.

I spent lunchtime on Facebook. I went on at night after my wife went to bed.

And then something happened.

I discovered Twitter.

I didn’t intend to convert. I avoided Twitter as long as possible. Josef Katz (@directmaestro)  said I should tweet, and I resisted. Eleanor Haas (@EleanorHaas), one of the most forward thinking marketing professionals I know, started tweeting and still, I resisted. But then Stephen Colbert (@StephenAtHome) tweeted while interviewing Twitter founder Biz Stone and I was hooked. It was all just so meta.

So I started tweeting.

For a while I did both. I even thought about connecting my Twitter (@jlsimons) to my Facebook.

But my Tweets tended to be about marketing and advertising, and that wasn’t really what Facebook was all about for me. Facebook was about reconnecting with friends, and Twitter was about business.

At least, that’s what I told myself.

But that wasn’t the truth.

It’s time to face the truth.

Twitter is just plain easier. Twitter doesn’t miss me when I don’t tweet, or at least, I don’t feel guilty about not commenting on every tweet I read. Twitter rewards me when I’m relevant… and challenges me to stay relevant.  Some of the most interesting articles I’ve read recently I found because someone I follow tweeted them.

I’m not the most prolific tweeter. The total of my tweets wouldn’t add up to a single week of Kevin Smith‘s tweets (@ThatKevinSmith). Ashton Kutcher (@aplusk) gets more followers in an hour than I’ve gotten in almost a year.

And still, I tweet. When I find something I think people will appreciate, I tweet it and I feel like I’ve added something useful to a conversation I want to be part of.

When I post a new post on my blog, I usually tweet it. Heck, I might even tweet this.

I almost never tweet about where I’m going or what I’m doing. I never tweet about what I’m eating. I know some people do, and I respect their right to do it. Tweet and let tweet, I always say. (Well, actually, that was the first time. But I’ll probably say it more often now.)

Sure, sometimes I still go to Facebook, but it’s not the same for me anymore. I can’t tell you why, or maybe I just don’t want to know, but I’m pretty sure it has nothing to do with the fact that Facebook is now the most popular site on the web and gets more visits than Google.

That would be silly, right, avoiding something just because everyone is doing it? Because then, someday, I’d have to give up tweeting for the same reason.

I’m not the kind of person who does things just because they’re new and shiny. Really I’m not.

But just in case I’m wrong, can someone please explain Foursquare to me?

“Just the facts, M’am.”

Pepsi, who has advertised in every Super Bowl for 23 years, is shifting its entire Super Bowl budget into social media via its charitable crowdsourcing community called The Pepsi Refresh Project.

According to a UMass Dartmouth Study released this month, 80% of the Inc 500 use social networking as a marketing tool. And 89% of them say it was successful, “using hits, comments, leads or sales as primary indicators of success.”

The Mobile Internet Report by Morgan Stanley, released in December, says,

“Regarding the pace of change, we believe more users will likely connect to the Internet via mobile devices than desktop PCs within five years.”

Okay, that wasn’t a fact. That was a prediction. But it’s a conviction backed up by a 424 page research report.

But this is: as of today, the Red Cross had raised $22 million for Haiti relief thru text donations alone. And I don’t know about you, but I first found out about the effort on Twitter.

I could keep listing facts that prove the value of social media, but I’m lazy. Instead, I’m going to post this great video, Socialnomics, by Erik Qualman, that I found on Josef Katz’s Marketing Maestro blog that addresses the ROI of social media.

Pepsi. Ford. Gary Vinochuk. Zappos. Lenovo. Burger King. Blend Tec. Dell. Intuit. Volkswagen. Barak Obama. The Red Cross.

They all get it.

Can someone please explain to me why there are still people who don’t?

As the new decade dawned, the war between content creators and distribution channels was heating up on a new front:  Television.

While Fox loudly beat its chest and threatened to pull its programming off Time Warner Cable, at 12:01 am Jan. 1st, without fanfare or warning shot, Scripps Network actually did pull the Food Network and HGTV off of Cablevision.

But unlike what happens when a news organization pulls content from a news aggregator like Google News and there are hundreds, if not thousands, of articles waiting to take its place, when a cable network like Scripps pulls its content from TV, there’s just an empty hole where yummy goodness used to be.

As in any good conflict, there are two sides. Cablevision accuses Scripps of “effectively holding their own viewers hostage in order to pursue a more than 200 percent fee increase…” And Scripps says the fault lies with Cablevision, and that “every other cable and satellite provider in the country has willingly and professionally renegotiated a fair market rate…” (You can read the full text of the statements from both Scripps and  Cablevision here on paidContent.org, which provides global coverage on the economics of digital content.)

In the case of Food Network and Cablevision, the dispute comes down to less than the cost of a candy bar.

Currently, Cablevision pays Scripps about 8 cents per household to run Food Network. They also pay 13 cents for HGTV according to this very informative article in Broadcasting & Cable about the Scripps Cablevision dispute yesterday.

Food Network, a Top 10 cable network, has seen ratings increase 21% in December among the 18-49 year old demographic, and HGTV increased 13% over the same period. Ratings increases like this can be worth millions in extra ad revenues.

In an attempt to reflect the increased value of their programming, Scripps is asking for an “astronomical” increase of over 200%, or about fifty cents. (Cablevision charges $55.95 for basic cable, which includes Food Network, so you can decide for yourself whether Food Network is worth more than 8 cents a month… or even $0.32.)

Apparently, according to Scripps, Cablevision made a much lower offer that was “take-it-or-leave-it, and would still make Food Network… one of the lowest paid channels on its (Cablevision’s) lineup.”

Of course, as these two giant superpowers fight it out, there’s bound to be collateral damage.

First of all, there are the advertisers who are losing coverage. Don’t cry too much for them, though, because  audiences and ratings are guaranteed by contract, or backed up by make goods. Although if you had a time sensitive offer, let’s say a new product launch in the gourmet food category or home appliance category at the start of the year, a future make-good may not be enough to overcome lost opportunity.

No, as is frequently the case with war, it is the cost in civilian casualties that hurts the most. The real victims of this conflict are the 3 million Cablevision homes in the NY tri-state area: innocent men, women and children who are being deprived of Rachel Ray and Alton Brown.

How can we live without knowing who was victorious in the Iron Chef Super Chef Battle featuring special guest Michelle Obama: Mario Battali and Emeril Lagassi or Bobby Flay and White House Chef Cummerford? Did Paula Dean invent some new way to combine butter, sour cream, mayonnaise and bacon and not die of an instant coronary? What cool, out-of-the-way soon-to-be-overwhelmingly popular joint did Guy Fieri find on Diners, Drive-Ins and Dives?

But more importantly, can someone please explain to me how I can make sense of this dispute for my 5-year old daughter, who knows nothing of Gross Rating Points and syndication revenue, when all she wants to do is see Chef Duff and his merry cakesters bake a cake shaped like a kitty cat on Ace of Cakes?

I see them everywhere… on my computer, on billboards, in the pages of magazines and on my TV screen… dead celebrities drinking champagne and dancing with vacuum cleaners and driving cars that came out decades after they were rotting in their graves.

It’s easy to see why advertisers want dead people to endorse them. Dead people are safe: they’re known quantities. It’s unlikely an ad campaign will get torpedoed by new revelations or scandals. They’ll never be accused of sexually assaulting a waitress in their hotel room or getting addicted to prescription pain killers. And even if we did find out something juicy and new about James Dean or Marilyn Monroe or Steve McQueen, would it hurt their image or just add to their mystique?

Dead celebrity endorsements are big business.

Einstein made $10 Million in 2009, according to Forbes latest annual list of top earning dead celebrities.  All the way back in the 2006 edition of the Forbes list, Corbis image licensing said Albert Einstein was their most requested person. As Tony Soprano might say, “Einstein is a good earner.” Of course, in his case, his earnings go to a good cause. The Hebrew University of Jerusalem gets the cash, including a share from Baby Einstein (Disney), although how would Albert have felt about their recent settlement for misleading claims of jump starting juvenile intelligence? Do you think he’d be proud that being a character in Night at the Museum ended up with him as part of a Happy Meal movie tie-in at McDonald’s?

If you want to hire a dead celebrity like Marilyn Monroe to sell your products, just click on over to the Legends Media Archive. You’ll find advertising-friendly images for dead celebs from John Belushi, Ingrid Bergman and Ty Cobb to Jackie Robinson, Mark Twain and Natalie Wood.

Live celebrities are no better. Some of them have even tarnished their reputations by becoming product hucksters. Are you old enough to remember when Orson Welles did commercials for Paul Masson wine: “We will sell no wine before its time.” More recently, we all had to cringe when Ed McMahon made a Cash4Gold commercial his last role.

But whether you think they sold out or not, it was their choice. Nobody forced them to make those commercials.

The dead can’t do that.

These dead celebrities have been stripped of their most basic right: the right to self-determination, to choose what they do or do not do. They are slaves to the choices of their estates, or of the people who own the copyright on their images.

Some cultures honor their dead. We exploit ours.

There’s nothing illegal about it, although the FTC is considering new regulations concerning celebrity endorsements, according to this blog post by Jonathan Faber, licensing expert and former president of “CMG Worldwide, Inc., whose clients include Marilyn Monroe, James Dean, Babe Ruth, Chuck Berry, Princess Diana…”

One of the proposed new rules is that “Advertisers should only use endorsements of celebrities if the advertiser believes that a celebrity subscribes to the views presented.” (Not a problem for the Marilyn Dom Perignon campaign, since it was her favorite champagne, or Steve McQueen driving a Ford Mustang, which he did famously in the 1968 cop classic, Bullitt.)

But this post isn’t about morality or legality. This post is about marketing.

The point of celebrity endorsement advertising is to make a connection between the celebrity’s persona, the product and the audience. If a celebrity swears by it, that’s good enough for me.

When done wrong, it can backfire. Who would believe that Paris Hilton ever ate at Carl’s Jr. or that Tiger Woods, one of the richest athletes in history and currently the top earning athlete endorser actually drives a Buick.

When done right, it can build a brand. When Brooke Shields said that nothing came between her and her Calvins, Calvin Klein became the must-have designer jean.

But what’s right about using a dead person to endorse your product? Does having David Spade talking to a now dead Chris Farley make you more likely to want to get Direct TV, or less? How many people went out and bought a Dirt Devil because some art director used special effects to force Fred Astaire to dance with one?

I know vampires and zombies are all the rage these days, but can someone please explain to me why anyone thinks a dead celebrity who never used a product can make a convincing sales pitch to the living?

Have you heard the one about the beautiful blonde Danish woman named Karen who went on YouTube in search of her baby’s father, a tourist with whom she had a one night stand a year and a half ago? Turns out it was all a hoax, courtesy of the Danish government tourism bureau, VisitDenmark.

I found out about this on Mashable, perhaps the greatest blog covering all things Web 2.0 and Social Media. According to Mashable, the video got over 800,000 views on YouTube before it was taken down. If you hurry, you can still see it here on this Australian 9 News site.

More from Mashable, “…by her own admission, the woman in the video is an actress named Ditte Arnth Jorgensen and the baby is not hers. According to Danish newspaper Ekstra Bladet, it’s a hoax created by the Danish government’s tourism agency… It seems that the Danish government opted for quite a radical approach in luring tourist to the country; as they say, any publicity is good publicity.”

Now, it’s easy to get outraged by the hoax, as comments on the YouTube video proved. There were people who felt sorry for Karen, and then felt abused when they found out it was a hoax.

Setting aside the moral issue, I’d like to look at it from purely a marketing point of view.

I’m not against hoax marketing, if it’s done right and delivers a high degree of value to the people being hoaxed. Sega’s Beta-7 is a classic of the genre. FastCompany did a great post-mortem article about the campaign and Campfire, the viral agency that created Beta-7, and before that, the Blair Witch Project, reporting that:

“Beta-7” ultimately clocked some 2.2 million followers and, for $300,000 (excluding TV spots), helped Sega top sales projections by 25% in a category overwhelmingly dominated by Madden. Along the way, however, Campfire had done something else: It proved that a young, cynical, media-saturated audience just might be willing to listen to marketers as long as they showed some respect. “The virtue of their work,” says ESPN’s Daly, “is that if you’re on the side of the equation that believes [the hoax], then it’s fascinating, and if you’re on the side that gets that it’s not real, then it’s just great entertainment.”

I think the key to successful hoax marketing is best summed up by Harry Anderson, the actor/magician who played lovable con artist Harry the Hat on Cheers and Judge Harry T. Stone on Night Court. Back in the 80’s I saw his live act at Caroline’s, basically a celebration of misdirection and the con. In bit after bit, as he tricked us while blatantly telling us he was tricking us and still got away with it, he made the point that you can take a victim’s money as long as you entertain him for it.

The Danish video certainly delivered entertainment value. It was compelling and engaging. It might deliver a great ROI and boost Danish tourism. (It even had a bit of mischief of which Harry the Hat might have approved: the word “Ad” is in the background as part of an innocuous piece of art.)

But the message it delivered was that the Danish Board of Tourism is willing to dupe you into visiting their country. If they’re willing to do that, what other practices may they condone? Bait and switch hotel packages? Cab drivers who overcharge tourists for trips to the airport? “Official” currency exchanges with rip-off rates?

And how’s this for a mixed message? In the video, Karen says that it was a discussion of “hygge” — the Danish word for a warm, fuzzy, cozy, comfortable feeling of well being (according to Wikipedia) — that led to the one night stand. (Don’t you feel warm and fuzzy knowing that the Danish government is willing to lie to you to get you into bed with them?)

What kind of tourist do you think an advertising message like this will attract to Denmark? If I were a Danish woman (or the father of one) I’d be appalled at my government right about now.

In the end, just because you can use an advertising tactic doesn’t mean you should.

So can someone please explain to me why VisitDenmark chose to advertise the warm and fuzzy nature of their culture with a hoax that is exactly the opposite of the brand character they were hoping to portray?

“Guaranteed. Period.” (R)

Land’s End built their direct response business — and helped the industry grow — with their “Money Back, No Questions Asked” guarantee. They engendered trust in an inherently risky proposition, that of buying products you couldn’t pick up and touch. And perhaps, because they needed to live up to that guarantee, they also pursued a higher level of quality.

Compare Land’s End to the insurance industry.

Hard on the heals of Sully’s heroic Hudson landing of US Airways Flight #1549 comes the insurer AIG’s decision not to pay insurance claims for the passengers. They claim the pilots did everything right, there was no equipment failure, and the geese were an “unusual incident.”  Apparently, if there’s no negligence, there’s no liability.

It’s like the insurance companies not paying some homeowners after Katrina because the insurers claimed that the damage wasn’t from the flood, it was from wind-driven storm surge. To a normal person, four feet of water in your house is a flood.

Even worse, there is recision, the practice of canceling the insurance policies of sick policyholders, frequently to avoid having to honor them, and often on technicalities unrelated to their illness.

According to this article in the LA Times, Blue Cross actually praised and promoted employees who saved them millions. One employee alone was praised for “dropping thousands of policyholders and avoiding nearly $10 million worth of medical care.”

How have we allowed a system to thrive where reality is trumped by legal fiction, or more accurately, legal stamina?  These insurance companies outwit, outlast and overwhelm us in the courts. Every day that they avoid paying out makes money for them at our expense.

Could you imagine another industry operating this way?

Imagine if Land’s End had acted this way? “Guaranteed. Until it’s not.” Who would have ever sent them a check? How long do you think they’d have lasted?

Land’s End became a powerful, popular and trusted brand because it lived up to its brand promises:  its quality, its customer service, and its guaranty.

How can the insurance industry ever hope to be loved and trusted by consumers when it continues to weasel its way out of its promises.

More importantly, can someone please explain to me how long we’re going to go on enabling these companies who are addicted to gambling with our money and then using legal obfuscation to avoid the consequences when they lose?

Good catalog copy needs to immerse its reader in an experience of a product they can’t touch. It’s a lonely voice in the wilderness, tasked with selling a product in a few words, at a distance, sometimes with the help of a picture.

Sure, if you’re selling copier paper or a toner cartridge in an office supplies catalog, you can get by with just the basics. But if you’re selling hand-stitched honeymoon hammocks made by entrepreneurial Maragucho mothers in steamy Venezuelan villages around Lake Maracaibo, or a $239.95 wooden ship model of The U.S.S. Constitution, “Old Ironsides,” or the softest pillow you’ve ever laid your weary head upon, non-descriptive copy just won’t do.

Your catalog doesn’t need to show your products in photographs, or even in color. Years before Banana Republic had brick and mortar stores, the Zeiglers’ hand-drawn, monotone illustrations on rough-hewn, un-coated digest-size stock built a direct response kingdom based on romance, adventure, intrigue and promise.

So did J. Peterman. Long before Seinfeld satirized him, his first ad was a 1/6 page black and white with a line drawing that appeared in the New Yorker back in the mid 80’s for the Cowboy Duster.

I still remember the last lines of that ad: “Although I live in horse country, I wear this coat for other reasons. Because they don’t make Duesenbergs anymore.” (See this People Magazine article from 2000 for the full story, including the name of the copywriter, Don Staley.)

The instant I read that ad I picked up the phone and ordered two coats, one for myself and one for my friend, noted funny car designer and railroad artist par excellence Tom Daniel.

I was a catalog copywriter at the time, selling wooden ship models and car collectibles at Model Expo, and I learned how to romance and sell just about anything by reading catalogs like Banana Republic and J. Peterman. (My copy for the Navy Issue Coffee Mug in the Lion’s Share catalog — “0:300 hours… the windswept, raindrenched bridge of a ship on patrol in the Pacific…” —  broke all sales expectations for what was supposed to be an impulse item throwaway on an order form.)

I get offended by bad  catalog copy. And there’s nothing worse than catalog copy that doesn’t deliver.

Why am I telling you this? Because I was just reading the black and white, line illustrated  Campmor catalog, my favorite outdoor adventure catalog, and came across the following available colors for hiking boots:  Havana, Jupiter, Gypsy and Brindle.

Now, to be sure, some color names are getting more intriguing, playful and engaging. I can figure out what color Butter is, especially when paired with Cordovan. Mint Green is easy, as is Dark Chocolate. Mud is a bit less clear – after all, wet dirt can come in a variety of hues. I’m pretty sure Limonata will look something like the liquid in those tiny Italian bottles of soda that cost way too much and never taste that good anyway.

But what about Beluga? Is it describing the whale, which is white, or the caviar, which is smoky black? Then there’s Moonstruck, Picante, London Fog, Andorra, Fossil, and Elephant (They don’t say whether they mean African, Indian or Pink. Hey, it matters!). Then there are the blues:  Pearl Blue, Turkish Blue, Brushed Metal Blue, and Goblin Blue. (I’ve played D&D for decades and never once heard of Goblin Blue.)

It’s not just one company. These colors describe boots by Columbia, Merrell, Vasque and North Face. I breathed a sigh of relief when I got to New Balance’s color palate:  Blue, Red, Brown, Black and Grey.

But my absolute favorite obfuscated colors are Havana, Jupiter, Gypsy and Brindle.

I looked at a Google Earth and for the life of me couldn’t figure out what color Havana is. (Unless they were making a sideways reference to skin color, but even then, Cuban skin color varies in the extreme from light to dark.)

I looked at a picture of Jupiter on Google. Do they mean the spot or the bands? And are they looking at the red-tinged color enhanced photos, the washed out grey ones, or what?

Gypsy — I don’t even know where to start, given that traditional Gypsy garb is very colorful and almost never monotone.

The best of all is Brindle. According to Webster’s Ninth New Collegiate Dictionary, Brindle is defined as “Having obscure dark streaks or flecks on a gray or tawny background.” Mmm, I want a pair of those to go with my Roan pants and Harlequin shirt. (What, no dog lovers out there?)

Look, I love when copywriters romance their descriptions. And I get the problem of making your product stand out from the next when they’re all colored Brown. But what’s wrong with using words that simultaneously describe and romance? Nobody was ever left wondering what color Mocha is, or whether Apricot would look better on your feet than Desert Sand.

I guess I could just go to the Campmor website and look at the pictures to find out what color these colors really are. But doesn’t that defeat the purpose of a printed mail order catalog in the first place?

So, since I’m clearly too stubborn to find out on my own, can someone please explain to me what color Havana is?

Try this experiment. Go hiking on some back country trail one day and ask every backpacker you meet what soap they have in their backpack and what socks they have on their feet. You might be surprised how many of them say Dr. Bronner’s Magic Soap and Thorlo socks.

It wouldn’t surprise me, though. That’s because I’m a big fan of both brands. But these days, only one of them makes me happy, and the other has begun to break my heart.

If you don’t know Dr. Bronner’s, here’s a great article that will do a better job than I can of telling you about one of the quirkiest brands on the planet with one of the most loyal customer bases of any product I know. Made from natural ingredients and organic oils, Dr. Bronner’s is sold in nearly every health food store in America. It’s inexpensive, it’s made by hand, and millions of bottles are sold every year with a minimal marketing budget. The company splits much of its profits with its small staff of employees, and gives away much of the rest to good causes ranging from Boys and Girls clubs here in the US to orphanages in China, schools in Mexico, and impoverished villages in Ghana.

The 61-year old company is still being run by the Bronner family, 5th generation, and still being bottled in the same anti-commercial packaging, a bottle completely covered in a cacophony of tiny words, a weird mix of philosophy and quotes from the Bible to Confucius, Chaucer to Paine, creatively adapted by the original Dr. Bronner himself.

Most importantly, the soap delivers the same customer experience it always has. It is an honest product that lives up to its brand promise.

Then there are THOR-LO socks. If you’ve never put on a pair of Thorlos then your feet don’t know what it feels like to walk on clouds. Thorlo socks feel so good and cushion your feet so well that you don’t mind paying up to $18 a pair for them. They’re made in the USA, they’ve never given me a blister, they wick away perspiration and they’ve got task specific models for virtually every type of activity you can do with your feet except swimming.

According to the company website, Thorlos are backed by 25 years of scientific research. The company has spent many millions on R&D alone. They’ve got 59 patents. They trace their roots back to 1953, when they made their first socks in 1953 for the military. The company even supports our troops by letting you buy discounted anti-microbial military versions and send them to the troops with no shipping or handling charges.

I have a couple of pairs of Thorlo socks that are at least 20 years old. I’ve worn them hiking at the top of the Swiss Alps and the bottom of the Grand Canyon.

Unfortunately, those 20-year old Thorlos are in better condition than the wimpy 2-year old pairs that are wearing out from just being worn to work.

If you are a long-time Thorlo fan like me, then you know that the quality of Thorlo socks has plummeted faster than the waters of Yosemite Creek plunging over the edge of Yosemite falls. They wear out in the heel and the toe so quickly that if you just stare at them long enough, you may actually see the fibers fall out. Okay, that’s clearly an exaggeration, but it’ s no exaggeration to say that the newer the pair, the shorter the life expectancy.

Both Dr. Bronner’s and THOR-LO have loyal fan bases, from celebrities and athletes (Martha Stewart uses Dr. Bronner’s and Martina Navritalova wears Thorlos) to regular folks like me. You won’t find either brand in Wal-Mart or Target, but you will find them in places like Whole Foods and Campmor, where shoppers demand value and store employees use and swear by the products they sell.

But while one brand has continued to deliver on its powerful, if quirky, brand promise, the other seems to be committed to destroying its reputation for longevity and durability, two of the brand attributes it’s most valued for?

So can somebody please explain to me why nobody at Thorlo seems to have noticed, or if they have, why they don’t seem to care?

UPDATE: 9/8/09

Somebody at Thorlo has noticed, thanks to a nudge from reader Oftenatangent, which got a response from Jim Throneburg Owner/Inventor/COB/CEO, and they do seem to care. See the comments below from Oftenatangent, Jim Throneburg’s response, and one by David Varsik, Director of R&D at Thorlo. Not only did David address my concerns, and admit that the current source for Fibers may not be everything desired in terms of longevity, but he directed me to Susan Graham in Customer Service to get more detailed feedback. I have done so, and after a frustrating experience sending them a comment, Susan got back to me. We had a pleasant, in-depth conversation, and I am sending them some socks for further investigation. I’ll keep you posted.

News outlets make news. But to make money, they wrap that news in advertising.

Anybody else see a disconnect?

As we all know, advertising revenues are down as advertisers shift their dollars to more attractive media channels. And not every newspaper, least of all the NY Times, will be saved by the influx in erotic advertising that is resulting from Craig’s List’s ban described in this article on Adotas.

So I have a suggestion. Newspapers should climb out onto the leading edge of the micro-payments industry in this country and charge us for the news we so desperately need the same way they used to pay their reporters:  by the word.

I wonder what would happen if the NY Times wrote an open letter to all its readers in all formats (print, online, Facebook, Twitter, etc.) explaining that the old advertising model no longer supports the costs of news gathering, and asking us to opt-in to a micro-payments structure that has users pay for content by the word or article.

After all, we pay for our music by the song or album at iTunes and Amazon. Users pay for their apps, too, at the iPhone store.

Maybe our news will cost us 100th of a penny per word — I don’t pretend to know — but there’s a number that would be worth paying to get accurate, valuable journalism, fed into our brains by whatever method we choose.

Faced with the alternative — disappearing like The Rocky Mountain News, turning into an online blog like The Tucson Citizen, or going Chapter 11 like the Chicago Tribune — would the stakeholders of the Times keep the “Old Gray Lady” afloat?

Advertisers could play along too. They could buy prepaid content credits that they would give to their target consumers  — as premiums, promotions, free-downloads, usage credits, rewards points, membership discounts or rewards. When a reader used credits, if they were sponsored, they would see their sponsor’s message.

From a reader’s perspective, it would look like this: Whenever I logged onto the Times website (or followed a Twitter link (A Twink?) etc.) I’d get a screen with that day’s advertisers’ offers. I’d pick a sponsor, they’d pay, I’d get my news, and they’d get my eyeballs. Maybe by the article, maybe by the day, maybe by bandwidth, whatever. (Hey, if Bank of America brought me my NY Times content for free, I’d gladly sit through their pre-rolls.)

These prepaid blocks would represent reliable chunks of income that could be sold through a digital auction model or on an upfront basis, or a combination of both (digital auction for the any inventory left over after the up front sales). A major advertiser could work out a promotion with Amazon that every large format Kindle would come with a sponsored year-long subscription to the Times.

Forwards to a friend could represent extra eyeballs for the advertiser, or extra charges, depending on the media buy.

It is frequently said that people don’t value what they get for free. While that may not always be true, it is true that the Internet has changed people’s cost/value perceptions as it pertains to news.

I am a news junkie. I stopped reading printed newspapers long ago, mostly because they’re outdated the minute they’re printed. And I’m ingesting more of my news online or on my phone rather than be continuously disappointed by cable and network news (which I am watching less frequently). Online, I can get better news faster. And much of that news comes from the NY Times. But I usually only notice the publisher after I’ve read the article, if at all. I frequently don’t even notice whose article it is I’m reading on Google News. Or Digg. Or a tweet.

So, in my desperate search for news, would I be willing to pay for that NY Times article? I would if, like E-ZPass, it was effortless to do. Would I sometimes choose an article from the competition if it were cheaper? Depends on the organization. (After all, I have always had the option to buy a Post or Daily News rather than a Times, and yet rarely did so.) More importantly, would I sit through ads for the sponsored version if it were free? I would.

Format-wise, news gathering and dissemination is wonderfully adaptable to large-format Kindles, Twitter, Facebook, SMS, and more.

But what will happen to the dead trees, and all the personnel associated with their destruction, rebirth, and delivery as newsprint?

Since we’re attempting to reinsert value into the equation, let’s look at it in those terms. Would people find enough value in the printed version to pay more for it? Might the printed version of the Times became such a status symbol that some people would happily pay more to make a conspicuously consumptive statement?

Where is the tipping point? Could the Times sustain a print edition at $10 per copy? Remember, under this model they’re already paying for news-gathering and editing with micro-payments. The printed version just needs to carry its own weight. And if it can’t, then I’m sorry for all those workers along the non-value chain, but it’s time for retraining.

So what do you think? Am I crazy, or could this work? And if so, can someone please explain to me why the NY Times isn’t already doing it?

Hi there, everybody. My name is Jeffrey Lee Simons, and I don’t have an iPhone. You see, my fingers are the wrong temperature or something and touch screens only work for me about 20% of the time. You’ve probably seen me at an ATM, stabbing my useless digits at the screen and cursing a blue streak until I remember to use the keypads.

(What uber-phone do I use? LG Voyager… it’s got a touch screen, but flip it open and you’ve got a full keypad.)

So I’ve missed out on the whole iPhone App feeding frenzy. Although I’m not sure exactly what I’ve been missing. After all, the average iPhone app only gets used about 19.9 times in its lifetime according to this article on marketingcharts.com.  “The study also found that 46% of users play their games/apps five times or more, while 10.2% play 25 times or more.”

I just read a detailed discussion about the economics of iPhone game apps in Gamasutra, the gaming business enewsletter, written by iPhone-appmaker Ian Bogost.  Game apps are among the most popular of all iPhone apps. (12 of the top 25 apps in Feb 2009 were games according to a recent Comscore report.)

Bogost tells a woeful tale of plunging sales (down 8% in April alone) and a race to the bottom for both pricing ($0.99 seems to be the target)and quality. The average net profit on an iPhone app is $1771, and for a game app that figure is closer to $900. That’s average. The difference between the hits and the not-hits is so wide that the median may be much lower, though Bogost admits this is hard to determine.

$900 or less. (Apple doesn’t even distribute royalties until you hit $250 in each region, so for many game developers, there’s no profit at all.)

Now while I haven’t ever produced an Apple iPhone Game App, I have produced a variety of games in my life, from advergames that took a minimum amount of time to historical simulations that took a tremendous amount of time. But at no time would I have looked at $900 or less profit as a sustainable business model.

Hoping and praying to be the breakout game among the multitudes is fun, to be sure, but makes for a harsh, ridiculously competitive and ultimately indefensible business strategy. (Although it sounds a bit like blogging. Or publishing. Or the music industry. Or…)

But the most insightful aspect of Bogost’s article concerned perceived value and customer satisfaction. People who are willing to shrug off a bad cup of $0.99 coffee hold a $0.99 game app to much higher standards. One is clearly disposable, and for $0.99 who really cares enough to complain. The other is not, and is far more likely to garner complaints (especially now that Apple lets people “comment after deleting” an app).

All this really comes down to value.

How much value can an app developer deliver for $999 or less? How much value does a customer deserve for $0.99 these days? Does using a product 19 times make it disposable or not? After all, you probably use a razor blade that many times before throwing it away.

And the answers, it seems, comes from where they always do. The customer. If a customer feels a product isn’t worth the money, they buy the lower priced versions. More people buy Toyotas than Rolls Royces, although to be sure, there is a market for both.

It looks like, in Apple-land, $0.99 is the acceptable price for everything from games to songs. Regardless of their cost to produce, you’re expected to make it up in volume.

But can someone please explain to me how consumers can ever expect to get value out of a system that refuses to return value to the producers?