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Archive for the category “business”

Sales pitch in aisle 7, but only if you’re in aisle 19

Back when supermarkets first came into existence, marketing to shoppers was so easy. You’d take out an ad in the local paper, or perhaps send some coupons in the mail, and let the shoppers run wild (with their shopping carts) throughout the store.

Then it got a little more complex, as stores began using new pitching methods, such as electronic mail, and new tactics, such as having a person on aisle 7 with samples of Name Brand Tasty Expensive Crackers.

But we haven’t seen anything yet, as supermarkets look for more and more ways to increase their pencil-thin profit margins.

Forbes’ Tom Van Riper reported on some research conducted by the University of Pittsburgh’s Joseph M. Katz Graduate School of Business. Faculty member J. Jeffrey Inman and others wanted to look at supermarket buying habits. The first part of their research was fairly intuitive, when you think about it.

[O]n average, shoppers cover half the territory in a grocery store, about 1,400 feet. Every additional 55 feet traveled triggers an additional dollar in unplanned spending, which occurs because shoppers end up seeing more items they want to buy.

Considering all of the effort that supermarkets devote to product placement, it isn’t surprising that we shoppers end up buying a lot of things that we didn’t intend to buy. So for supermarkets, the secret is to keep us wandering around in the store, like rats in a maze, so that we see more and more stuff that we want to buy.

But how can we be encouraged to wander around the store? Inman and his colleagues conducted some additional research with smartphone-using shoppers, as Forbes’ Van Riper explains.

Inman took one sample of people and divided them into two groups: 1) those getting a coupon [via smartphone] for a product located close to the path they would normally travel, 2) those getting a coupon for a product further off that path, forcing them to cover more ground in the store.

Result: those forced off the beaten path spent $21 more than they had planned to, while those sticking closer to their routine spent $13 more than planned, a 61% difference.

Provided that the shopper opts-in to smartphone use and purchase and location tracking, this provides powerful potential revenue for stores.

And it’s certainly a better incentive plan than having attack dogs chase shoppers through the store.

What goes around comes around – the record industry

I have previously observed that the supermarket chains who are complaining about Walmart aren’t entirely guiltless, since the supermarkets wiped out a whole bunch of markets back in the day. But the evolution of business is not limited to the grocery industry.

On Saturday, May 30, the band Berlin performed at Rhino Records in Claremont, California, and David Allen was there. He recorded the following comment by Berlin’s Terri Nunn:

“Can I tell you how great it is to be in a record store?”

Nunn’s love of record stores isn’t just because of her career as a recording artist. As Allen notes, quoting Nunn:

Her parents owned a small record shop in Reseda in the early 1970s “until Tower and Wherehouse killed us off.”

Now I’ll admit that I participated in that killing – I’d take the bus to the Tower Records on SE 82nd St. in Portland when I could, and I’d drop in to Wherehouse and other chains after moving to California. But those who didn’t like the chains are having the last laugh today, since Tower Records and Wherehouse Music are long gone.

The Virgin Megastore chain, however, is still thriving – in the Middle East.

Virgin Megastore has been a high street icon everywhere from Times Square in New York to Sydney, Australia since Richard Branson opened the first music store on Oxford Street in London in 1976.

You can buy CDs, DVDs, games, books, apparel and electronics from Virgin music and entertainment stores in the Middle East and Gulf countries:

• visit Virgin Megastore in Egypt, Jordan, Kuwait, Bahrain, Qatar, UAE

However, times they are a-changin’, and sad but true – Virgin Megastores are no longer open in the UK, France, Germany, Ireland, Spain, US, Canada, Australia and Japan.

Your assumptions about time are not universal

From Olga Mecking (European Mama):

In his book, “The Shadow of the Sun”, Ryszard Kapuściński writes about differences in the perception of time between African or Western cultures. In the West, the buses run after a schedule. In Africa, it runs when it is full. In some cultures, time is linear, from birth to death, it shows a process, a progress, a development. In other cultures, time is cyclical and always follows the same path: the four seasons, a woman’s monthly cycle, holidays and celebrations.

More here.

The pendulum is shifting away from the cloud. Told you so.

For years, I have been espousing a pendulum theory. Briefly, it states that we alternate between a “benevolent” model and a “rugged individualist” model. In the latter, computers (and things that are like computers, such as refrigerators) stand alone and do not depend upon anything else, but if they fail, they fail. In the benevolent model, an entity such as a time-sharing company or a cloud provider runs the show; you aren’t totally dependent upon yourself any more, but you are somewhat dependent upon this other entity.

Over the last few years, with all of the cloud hullabaloo, we have clearly been on the “benevolent” side of the pendulum. We don’t have to worry about our email, our Adobe files, or our Siri instructions – but if our email provider, Adobe, or Apple go down, we’re in trouble.

But, as any fool could predict (which is why I predicted it), we’re starting to see a retreat from the cloud. It even has a super-cool name: the “fog.”

The problem of how to get things done when we’re dependent on the cloud is becoming all the more acute as more and more objects become “smart,” or able to sense their environments, connect to the Internet, and even receive commands remotely. Everything from jet engines to refrigerators is being pushed onto wireless networks and joining the “Internet of Things.”

Modern 3G and 4G cellular networks simply aren’t fast enough to transmit data from devices to the cloud at the pace it is generated, and as every mundane object at home and at work gets in on this game, it’s only going to get worse.

Luckily there’s an obvious solution: Stop focusing on the cloud, and start figuring out how to store and process the torrent of data being generated by the Internet of Things (also known as the industrial Internet) on the things themselves, or on devices that sit between our things and the Internet.

And so all of the data, and all of the computing power, is starting to move away from the cloud and is moving out toward the edge devices.

Or at least until the pendulum swings back the other way.

Unintended consequences of seawater fuel – you can afford the drive to dinner, but can’t afford the dinner

Larry Rosenthal shared a Justin Rosario post about how a U.S. Navy technological advance will bring grief to evil Republicans as Big Oil gets smaller and no one cares about the Middle East any more.

But I’m not going to talk about that. First, I’m going to talk about the technological advance itself. Rosario quotes from the International Business Times:

After decades of experiments, U.S. Navy scientists believe they may have solved one of the world’s great challenges: how to turn seawater into fuel….

The new fuel is initially expected to cost around $3 to $6 per gallon, according to the U.S. Naval Research Laboratory, which has already flown a model aircraft on it.

While the International Business Times focuses on the new technology’s application to U.S. Navy ships, Rosario speculates – correctly – that the technology could also be put to civilian use. While he looks at good things (well, good things from his perspective), it’s wise to remember that everything has unintended consequences.

Everything.

Let’s assume for the moment that the technology can be expanded from military use to civilian use, and that Big Oil companies and repressive Third World dictatorships disappear overnight, and that a vast network of fueling stations appears around the world, but that the fueling stations are all run by really really nice people who pay their employees $100 an hour while providing fuel at pre-1973 prices of 10 cents a gallon.

Everybody’s happy, right?

“Mom, can we go to Red Lobster tonight?”

“No, son.”

“But Mom, the Red Lobster is only 100 miles away, and it would only cost us a dime to drive there!”

“That’s right, son, but I can’t afford to pay $1,000 for a fish dinner tonight.”

“$1,000? Why do fish dinners cost so much, Mom?”

“Because of all the barges that are going up and down the coastline, converting seawater into fuel.”

“I remember those barges, Mom. They were a lot of them. They looked pretty cool!”

“Well, son, the fish don’t like all of those barges, so they all moved to other waters, and now the fishers aren’t catching that many fish any more. So fish dinners cost a lot more today. Back when I was a kid, I could get a fish dinner for less than it cost to buy two gallons of gas.”

“A fish dinner costing less than two gallons of gas? That’s really weird, Mom.”

Office on iPad – two thoughts

Loren Feldman shared a link to a New York Times article about the availability of Microsoft Office on the iPad.

My first reaction was to something the Times said:

Microsoft introduced the long-awaited suite of applications, which includes Word, PowerPoint and Excel, at an event here Thursday, where the company’s new chief executive, Satya Nadella, committed to making the software work on all major computing devices, including those made by its competitors. Microsoft plans to create Office apps for tablet computers running Google’s Android operating system, too.

To some, the move is a refreshing sign of a new Microsoft, one slowly unshackling itself from an era when its major decisions were made in deference to Windows, Microsoft’s operating system. But skeptics wonder if Microsoft has waited too long, giving people who use iPads, especially business professionals, years to get used to life without it and giving an opening to start-ups and Apple’s competing products.

The tenor of the article suggested that Microsoft was doing something new.

Nothing could be further from the truth.

Unlike Apple, who enforced an “Apple only” mindset until reluctantly making iTunes available for Windows, Microsoft has consistently provided products for non-Microsoft platforms. In fact, when the Macintosh was introduced in 1984, one of the featured vendors was…Microsoft.

My second reaction was based upon Loren Feldman’s reaction to the idea of leading vendors offering subscription services – or, in Feldman’s words, “[p]aying to edit a doc.” This prompted me to add a comment that reflected what I’ve been saying in this blog (and others) for years, and to offer one of my extremely accurate (or extremely inaccurate) predictions. My comment:

I strongly believe in a pendulum model in which we’ve bounced between centralized and decentralized computing over the last few decades. We’re obviously in a centralized mode now, with cloud computing all the rage and with our mobile device applications (such as Siri) heavily dependent upon centralized servers somewhere else.

Subscription models can work well in such an environment, and are obviously lucrative for the companies.

But there’s always a chance that users, spooked by the NSA and tired of the Big Data Suckers, may suddenly decide that they’d prefer to have apps and data on their own servers, under their own control, with no Amazon or Apple or Facebook or Google sticking their noses in it.

I may be wrong, but I suspect that in the next few years there will be a lot of rain on the cloud parade.

Pong was just a training exercise. It trained the entire video game industry.

I’m sure that younger people stare in disbelief when they see the computer game Pong for the first time. “That’s it?” they probably say to themselves. Compared to modern games, or even 1980s games such as PacMan, Pong is one of the most boring games in history. Yet this game not only changed the company Atari, but it created an entire videogame industry.

According to ponggame.org, Atari’s original mandate was to create games for other companies. Along the way, one employee, Allan Alcorn, created Pong as a training exercise. Atari founder Nolan Bushnell made a few tweaks and put the game in a bar. The success of the game at the bar (yes, alcohol was involved in the creation of Pong) convinced Bushnell that Atari should manufacture the game itself, rather than licensing it out.

By the time Pong’s run had ended several years later, Atari had not only sold 35,000 Pong machines, but had also sold 150,000 units to the home market.

Today, the Pong Game is considered to be the game which started the video games industry, as it proved that the video games market can produce significant revenues.

If you want to experience Pong for yourself, go here. Your computer should probably be able to handle the game’s technical demands.

Are we more vulnerable than the Ingalls family on the prairie?

The Ingalls family, immortalized in a series of books by Laura Ingalls Wilder, had it rough. If a disaster struck the family during a long winter, they couldn’t just dial up 911 and get relief. If one of the Ingalls kids was going blind, they couldn’t consult WebMD or Skype the Mayo Clinic.

But they did have advantages over us.

If they were sitting at home one night, reading, they didn’t have to worry about a virus sweeping through the home and stealing everything that they – and their neighbors – own. But we have to worry about such things.

Researchers at the University of Liverpool have shown for the first time that WiFi networks can be infected with a virus that can move through densely populated areas as efficiently as the common cold spreads between humans.

The team designed and simulated an attack by a virus, called Chameleon, and found that not only could it spread quickly between homes and businesses, but it was able to avoid detection and identify the points at which WiFi access is least protected by encryption and passwords.

And while the Ingalls family could be snowed in, or perhaps blown away by a tornado, they wouldn’t necessarily have to deal with a geomagnetic storm that could cripple millions of people:

Geomagnetic storms can occur with little warning. The worst geomagnetic storms are the result of coronal mass ejections (CMEs) in which billions of tons of highly charged particles from the sun’s surface shoot into space toward the Earth and disrupt the Earth’s magnetic field. A geomagnetic storm would reach Earth between fourteen and ninety-six hours, leaving little time to safeguard critical infrastructure after a CME has been detected. NASA’s Advanced Composition Explorer (ACE) satellite, located a million miles from Earth, can give a 30-minutes first-warning on the severity of an incoming geomagnetic storm.

A geomagnetic storm disrupts the Earth’s magnetic field by producing geomagnetically induced currents (GICs) on the Earth’s surface, which can enter the power grid at transformer stations and move along power lines, disrupting normal operations. Wild fluctuations in voltage across power lines could cause power failure as relays try to isolate vulnerable equipment. High-voltage transformers could become overloaded and overheat, leading to permanent damage. Old high-voltage transformers nearing the end of their service lives are most vulnerable.

“Pa, the geomagnetic storm’s coming in! Secure the candles!”

“I can’t do that right now, Ma. I have to go down to the bank and find out why all our money is in China!”

Live from Stamford, it’s the Sochi Olympics!

Remember my post from last month that predicted a time when the only people at a sporting event would be the players?

That time may be closer than we think.

Of course, the idea that EVERYONE has to be at a sporting event is a relatively new concept. Back in the days that Ronald Reagan was a radio baseball announcer, he and his fellow announcers often broadcast games from a studio, heavily dependent upon a stream of information from Western Union.

That offended modern sensibilities, and companies subsequently insisted that their announcers actually attend the games that they were broadcasting. And they did; during Monday Night Football’s heyday, the arrival of Gifford, Cosell, and Meredith in an NFL city was regarding as the circus coming to town.

But now, the pendulum is swinging back a bit.

If you live outside of Los Angeles, you may think that Petros Papadakis and Matt “Money” Smith have disappeared from the radio entirely. The truth is, however, that their show – initially local, then national – has gone local again. And on Thursday’s local show, Papadakis was talking about his Sunday night television partner, Fred Roggin, who had left Los Angeles to cover the Olympics. But Roggin hadn’t gone to Sochi, Russia – he had gone to Stamford, Connecticut.

Roggin, however, is a host, and hosts are usually broadcasting from some studio or another. It’s not like the Sochi Olympic play-by-play announcers were going to be in faraway Connecticut, would they?

Well, actually…

“We have a team in Stamford that will be grabbing event highlights, interviews with athletes, medals ceremonies, feature stories, amazing finishes,” [NBC Sports editorial VP Tom] Seeley said. “They will produce about 100 clips a day, long-form replays plus short-form clips of three to five minutes.”

It also means curling coverage, live from Russia and Stamford….

During curling competition in Sochi, video “will be coming to Stamford over digital paths,” [NBC Sports engineering VP Tim] Canary said. “The matches will come with natural sound, but the voicing will be done in Stamford. We will put curling experts in an announce booth and they will do play-by-play. So viewers will be hearing a call done in Stamford for a match being played in Russia.”

Unfortunately, these announcers will not be supported by Western Union.

When knowledge expands

A recent Mel Kleiman post began as follows:

Human knowledge is now doubling every 3.7 years. This means 50 percent of what you now know will be out of date in less than four years.

Let’s focus on the second word of that post. When Kleiman says that knowledge is doubling, is his definition of “knowledge” equivalent to my own?

To clarify, I have consistently used a four-step model from Sujatha Das that discusses data, information, knowledge, and wisdom. Clearly data is always expanding, but is actual knowledge expanding?

Based upon Kleiman’s example, I suspect that we are using the same definition of knowledge.

Just to bring it home, let’s imagine you need open heart surgery. How would you like to have it performed by someone who hadn’t learned anything new about the procedure in the past 48 months?

Open heart surgery requires knowledge. (But it also requires wisdom.)

If knowledge is truly doubling that quickly, this has significant ramifications for how things are done – and, as Kleiman notes, who we get to do these things.

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