Health Care Sharing Ministries

When Jase and Jennie Stefanski needed to pay a midwife her $5,000 fee for delivering their child, the money came from an unlikely source: people who are members, like them, of a Christian nonprofit group called Samaritan Ministries.  In dribs and drabs, the checks arrived, most between $135 and $320, reports Kaiser Health News.

The Stefanskis don't have health insurance.  Instead, they belong to a "health care sharing ministry" whose members follow biblical teachings that they share each other's burdens -- in this case, their medical costs.

• Each member pays a monthly fee that varies with family size: Single members generally pay $135, couples $270, single-parent families $200 and two-parent families $320.
• Members pay the first $300 for any medical expense they incur; when they have billsabove that amount, they send them to the ministry's main offices.
• The ministry keeps track of the needs, informing other members where to send their monthly check, and letting those who have made requests know what checks to expect.
• If there's a shortfall one monthevery household seeking help gets a prorated portion of its needs covered, and the ministry asks members for voluntary contributions to make up the difference.
• If the shortfall continues, members vote on raising the share amount.

Although the ministries say that they're not providing health insurance and are therefore exempt from state insurance regulations, states sometimes beg to differ.  Concerned that members may believe such ministries guarantee coverage of their medical bills, regulators have at times tried to shut them down.

The federal health care overhaul adopted by Congress last year recognizes ministries that share health care expenses as part of their religious practice.  The law exempts members of such ministries from the penalty that will be levied against individuals who don't purchase health insurance starting in 2014, a fact which all three of the major ministries highlight to varying degrees on their websites, says Kaiser.

Source: Michelle Andrews, "Some Church Groups Form Sharing Ministries to Cover Members' Medical Costs," Kaiser Health News, April 25, 2011.

Starbucks Becomes No. 3 U.S. Chain, Passing Burger King and Wendy's

McDonald's Is No. 1, Subway No. 2, as Burger-and-Fry Perennials Slip on Restaurant List Despite Heavy Ad Spending

Starbucks, just a few years ago a flailing company closing hundreds of locations, has become the No. 3 restaurant chain in the nation, surpassing Wendy's and Burger King, according to Technomic's recently released 2011 Top 500 Chain Restaurant Report.

For years the top three chains in the U.S. were burger-and-fry heavyweights McDonald's, Burger King and Wendy's. Now Starbucks is surpassed only by McDonald's and No. 2 Subway.

According to the report, Technomic estimates that Starbucks posted about $9.07 billion in U.S. sales, up 8.7% from the prior year, giving the coffee giant 57.2% share in the coffee and other beverage category.

McDonald's, perennially No. 1 in U.S. sales, had about $32.4 billion in U.S. sales in 2010. Subway, despite having about 9,000 more locations in the U.S. than McDonald's, had about $10.6 billion in U.S. sales, according to the report.

Top 10 U.S. Restaurants, per Technomic

1. McDonald's
2. Subway
3. Starbucks
4. Burger King
5. Wendy's
6. Taco Bell
7. Dunkin' Donuts
8. Pizza Hut
9. KFC
10. Sonic Drive-ins

Burger King, on top of recent marketing-management and ownership changes, as well as being on the lookout for a new agency since it announced it was splitting with CP&G after a seven-year relationship, is facing a sales slump. According to Technomic, Burger King, No. 4 on the top 500 list, had about $8.7 billion in U.S. sales, down 2.2% from 2009. In terms of the hamburger category, as well as restaurant chains overall, Burger King could potentially lose to No. 5 restaurant Wendy's, a chain nipping at Burger King's heels with $8.3 billion in U.S. sales, according to Technomic.

In last year's top 500, which ranked chains by 2009 U.S. sales, McDonald's was No. 1 with $31 billion, Subway was No. 2 with $10 billion, Burger King was No. 3 with $8.9 billion, Wendy's was No. 4 with about $8.4 billion and Starbucks was No. 5 with just more than $8.3 billion.

Starbucks last year aggressively upped it measured media ad spending, according to Kantar, doubling it to $94.4 million, up from $47 million in 2009. Still, it doesn't come close to the measured media spending of Wendy's and Burger King. Wendy's in 2010 spent $283.4 million, down from $293.4 million in 2009, according to Kantar. Burger King, pulling back over the years on its outlay, shelled out about $301 million on domestic measured media in 2010, down from $308 million in 2009 and $327 million in 2008. McDonald's spent about $887.8 million on U.S. measured media spending in 2010, up from $872.8 million in 2010.

As Lots Thin, Toyota Offers Dealer Aid

Toyota is supporting U.S. dealers by launching an array of incentives and financial aid to combat thinning vehicle inventories due to Japan's earthquake.

"These incentives are there to help dealers maintain their profitability," said Toyota Financial Services spokesman Justin Leach. They mirror efforts made to support retailers during the automaker's recall crisis in early 2010, he said.

Toyota said last week that full assembly rates may not return until at least November, with many plants operating at 50 percent capacity or below in the interim.


According to an e-mail sent to dealers on Tuesday by Toyota Financial Services and confirmed by Leach, the dealership aid programs include:

• Lowering Toyota Financial's borrowing rate for dealers of Tier 1 (prime) and Tier 1+ new-car loans by new 50 basis points for the next 60 days.
• Offering 2.9 percent annual percentage rate financing on all Tier 1 and Tier 1+ certified-used vehicles for the next 60 days.
• Raising residual values on all 2011 Toyota and Scion models by 2 percentage points for the next 120 days.
• Allowing dealers to borrow up to 130 percent -- up from 120 percent -- of a new car's value to allow a customer to cover fees, service agreements or an upside-down trade-in.
• Allowing Toyota and Lexus dealers to increase some lines of credit by up to 50 percent. This incentive is only available to dealers who floorplan with Toyota.
• Providing lease extensions for customers for up to 12 months, in six-month increments.
• Suspending payments of principal on Toyota Financial-financed real estate loans for Toyota and Lexus dealers. Interest payments are still required.
• Making it easier for dealers to qualify customers in vehicle service agreements on new car sales.
• Changing insurance product participation program volume qualifiers
• Rewarding dealers by making it easier to earn incentive trips.

Toyota also is becoming more aggressive in the used-car market by offering vehicles through closed auction for two weekends instead of one.

Additionally, if a dealer buys a car through Toyota's "Dealer Direct" auction program, and the car does not sell within 60 days, Toyota will buy the vehicle back for 100 percent of the purchase price, Leach said.

Toyota is pushing fleet customers to return vehicles, to give a larger used pool for its dealers to choose from.

The automaker had a 52-day supply of Toyota/Scion models on April 1 and a 37-day supply of Lexus models.

Watch Your Wallets: the Baby Boomers Are Beginning to Retire

The demographic picture has changed now that the baby boomers are starting to retire.  In 1950, there were 7.2 people aged 20-64 for every person age 65 and older in the Organization for Economic Cooperation and Development.  By 1980, the ratio had dropped to 5.1. Now it is around 4.1, and by 2050, it will be just 2.1.  In short, every couple will be supporting a pensioner, says The Economist.
Europe and Japan are facing the biggest problems:

• The average dependency ratio in the European Union is already down to 3.5, and is heading for 1.8 by 2050.
• In Italy it is forecast to be nearly 1.5 and in Germany nearly 1.6.
• Japan is on track for a startling 1.2 by 2050.

Since the average pensioner currently draws a total of about 60 percent of median earnings, from government and private sources, the system is likely to become unaffordable.  In a sense, it does not matter how the benefits are paid for.  If they are unfunded, they come from workers' taxes; if funded, they come from investment income.  But the income has to be generated by someone, says The Economist.

There are ways of reducing the burden.

• The current generation of workers could save more now.
• If they put more money into funded pension schemes, the extra saving might encourage more investment and thus boost economic growth.
• A wealthier society would find it easier to afford paying pensions.
• In addition, countries with PAYGO schemes could raise taxes now, reducing the deficit and thus the debt burden on the younger generations.

Source:  "Too Much, Too Young," The Economist, April 7, 2011.

Major Builders Starting to Offer Green Tract Homes

To stand out in a still-sluggish housing market, major builders are starting to sell affordable tract homes that come with solar panels and nearly zero utility bills.

On Earth Day Friday, Meritage Homes will begin offering a "net-zero" home that's designed to produce as much energy as it uses annually. Such homes, starting at $140,000 in Tucson and $160,000 in Las Vegas, will be available in parts of Arizona, California, Colorado, Nevada and central Texas, where a nine-panel rooftop solar array is already a standard feature. For a $10,000 upgrade, consumers can get 24 more solar panels that could reduce utility bills to zero.

"It's a new way of building homes," says C.R. Herro, vice president of environmental affairs for Arizona-based Meritage, the nation's ninth-largest builder.

"This is the first major-size builder to do this," says David Johnston, author of Toward a Zero Energy Home. He says net-zero building has become common in Canada, but until now relatively few affordable-housing units have achieved such efficiency.

Still, in an economy with $4-a-gallon gasoline, Meritage's effort reflects an industrywide push to build homes that cost less to operate.

Last month, Los Angeles-based KB Home announced that it will include as a standard feature in 10 Southern California communities a small, six-panel rooftop solar array capable of cutting energy costs by about 30% in an 1,800-to-2,000-square-foot home.

"Just about all the larger builders are focusing on energy efficiency," says Kevin Morrow of the National Association of Home Builders.

"Shiny granite can only go so far" to lure buyers from low-price foreclosures, says Nate Kredich of the non-profit U.S. Green Building Council. Kredich says he applauds Meritage for "really pushing the envelope" on sustainability.

Bruce Ploeser's family of six plans to move next week into Meritage's first net-zero house, in the Verrado community in Buckeye, Ariz.

"It's beautiful," says Ploeser of the five-bedroom, 3,400-square-foot, $326,000 home.

He likes watching its meter, which often shows that the 25 photovoltaic panels are sending a surplus of energy back to the grid.

"I'm just amazed," he says, "that it's running backward."

(Source: USA TODAY, 04/20/11)

Hyundai to guarantee trade-in values

Starting May 1, Hyundai Motor Co. will guarantee the future trade-in value of its new vehicles.

When a consumer buys a new vehicle from a Hyundai dealership, the company will guarantee what the trade-in value of that vehicle will be after the second full year of ownership through the fourth year.
To qualify for the guaranteed trade-in value, customers must show proof that they have completed all factory-recommended vehicle maintenance at a Hyundai dealership.

The program, called Hyundai Assurance Trade-in Value Guarantee, will base the future trade in values on residual values set by Automotive Lease Guide.

"Depreciation is the single highest cost of car ownership," Hyundai CEO John Krafcik said in a statement. "While Hyundai's depreciation is now among the lowest in the industry, Assurance will remove many of the barriers and concerns about vehicle ownership."

The program's launch comes after Hyundai last month ended the Hyundai Assurance provision that allowed customers to return a new vehicle if they lose their job. The job-loss protection package was used to launch Hyundai Assurance in 2009.

The promotion proved to be a major marketing coup in the industry, and Ford and General Motors quickly copied it.

Through March, Hyundai sales were up 28 percent from the same period in 2010 to 142,620 vehicles.
For dealers, the requirement that customers prove they've serviced their cars at Hyundai dealerships could help improve service retention, an area in which Hyundai dealers significantly trail top-flight competitors such as Honda, Toyota and Ford.

Dave Zuchowski, Hyundai's U.S. sales boss, said in March that the brand's roughly 50 percent absorption rate – the percentage of a dealership's overhead covered by gross profit from service and parts business – was well behind that of its competitors, which in some cases have absorption rates of more than 80 percent.

Internet Radio Garners Higher Ad Response, Recall Rates

Response rates increase 200% when advertisers add Internet radio -- defined as both online-only stations and streams of broadcast stations -- to online campaigns, according to research conducted by Parks Associates for audio ad network TargetSpot.

According to the new "Internet Radio Advertising Impact Study," "users who spend the minimal amount of time listening to Internet radio had higher ad response rates than heavy Internet-only users."

Ad responses as defined by the report include purchasing a product online or at a retail location, searching for product information, becoming a "fan" on Facebook, or calling the advertisers.

The research also reported 350% higher ad response rates when advertisers add Internet radio to broadcast radio campaigns.

In a companion report on "Digital Audio Usage Trends," Parks and TargetSpot focused on listener engagement. They report that 52% of digital audio listeners recall hearing or seeing an Internet radio ad -- with 40% of that group responding to an ad.

The study says that digital audio has now reached critical mass -- 39% of U.S. broadband households. While 96% of the Internet radio audience listens via computers, 45% over mobile, and 15% on tablets, the latter medium has the most active users -- with 25% of tablet listeners tuning in for four or more hours daily, compared with 23% of computer users and 16% of mobile users.

And 73% of digital audio listeners reported changing stations multiple times daily, a stat the study says mirrors listening patterns for over-the-air radio. That's significant, since the study also found that Internet radio ad recall increases 17% -- and response rates 200-500% -- when users tune in to two or more stations.

The "Internet Radio Advertising Impact" study, conducted online in January, surveyed 2,127 U.S. households that listen to both broadcast and Internet radio -- and use the Internet at least once a month. The "Digital Audio Usage Trends" study, conducted online in December, surveyed 1,000 U.S. Internet radio listeners (ages 18+) who listen to the medium at least once a month.

(Source: Online Media Daily, 04/12/11)

What Is Rapport?

Rapport creates the space for the person to feel listened to, and heard, which doesn't necessarily mean they have to agree with what you say or do. You can appreciate each other's viewpoint.

When you have rapport with another person, you have the opportunity to enter their world and see things from their perspective, feel the way they do, get a better understanding of where they are coming from. And as a result, enhance the whole relationship. This will allow them to feel good about themselves, you, and the relationship you've started.

The key to establishing rapport is an ability to enter another person's world by assuming a similar state of mind. The first thing to do is to become more like the other person by matching and mirroring the person's unconscious behaviors - body language, voice, words, etc. Matching and mirroring is a powerful way of gaining an appreciation of how the other person is seeing/feeling/experiencing their world.

The simplest way to help build rapport is to match the micro-behaviors of those you wish to influence. Any observable behavior can be mirrored, for example:

* Body posture
* Spinal alignment
* Hand gestures
* Head tilt
* Blink rate
* Facial expression
* Energy level
* Breathing rate
* Vocal qualities (volume, tonality, and rhythm)
* Key phrases and words
* Anything else that you can observe...

At first, this may seem a little strange or uncomfortable for you as a salesperson; though I assure you, with a little practice you'll become natural and proficient at it in a short period of time. And remember this: The basis of rapport is a natural process, which is happening already within any interaction between two or more individuals. You are simply duplicating the process on a 'conscious' level with purpose and volition.

You may wish to start with family members by beginning to match different aspects of their posture, gestures, voice, and words. Have fun with it and see if they notice what you are doing. At work or socially, start by matching one specific behavior and once you are comfortable then match another. For friends with whom you really feel comfortable, notice how often you naturally match their postures, gestures, and tone of voice or words.

Matching comes naturally. You need to learn how to do it with everyone. Matching will then eventually become automatic.

Toyota slashes North American production through May

Toyota will slash the production schedule at its North American manufacturing plants through June 3 in the wake of continued parts shortages stemming from the March 11 earthquake in Japan.

Originally, Toyota had placed its North American plants on three-days-a-week schedules through April 25th. For the rest of April and May, that schedule will continue, according to a statement released today by the automaker. When the plants are building vehicles, it will be at a 50 percent pace -- meaning the plants are operating at 30 percent of total capacity each week because of the additional two days of idle time.

In addition, Toyota's U.S. production will be suspended the week of May 30, following Memorial Day, while its Canadian operations will be suspended the week of May 23, in conjunction with Victoria Day.

Toyota said no layoffs are planned. The automaker declined to speculate on plant slowdowns after June 3rd.

Settling Social Security's Debt

Could Social Security's debt be settled at a discount by voluntary transactions with its creditors, namely American citizens?  Alex J. Pollock, resident fellow at the American Enterprise Institute, proposes that it could. 

Large numbers of people, especially young people, do not believe that they will ever fully collect on Social Security's promises, that is, its debt at par.  So Pollock believes significant numbers of people would be interested.  These might well include the 68 percent of respondents aged 19 to 29 who were "not confident at all," or "not so confident," that they would get their full benefits.

• The present value of all future income of the Social Security trust fund dealing with the pensions program is $34.5 trillion, according to the Social Security Trustees 2010 Report.
• Against the $34.5 trillion in assets, there are liabilities of $41.4 trillion -- this is the present value of all the future cash outflows promised by Social Security.
• The liabilities are $6.9 trillion greater than the assets.

Putting these numbers together, the $34.5 trillion in assets of Social Security available to pay promised pensions are only about 83 percent of the promises of $41.4 trillion.  Since the assets are equal to about 83 percent of the liabilities, this gives us a reasonable estimate of the fair way to settle the debt of Social Security to its creditors (namely, us): 83 cents on the dollar.

So would you rather have 83 cents of your own, which you could invest to earn interest you would own, or would you prefer 100 cents of future claims on an admittedly insolvent government pension program?

Source: Alex J. Pollock, "Would You Settle Your Claims on Social Security for 83 Cents on the Dollar? (I Would)," The American, April 7, 2011.

Display Ads Grow; Bullish Market For Home Page Buys

Taking seasonality into account, the display ad industry continues to experience solid growth and positive momentum, according to new data from Macquarie Capital.

The firm is maintaining its estimate of low-double-digit display growth for the industry in 2011, and upholding its current estimates for AOL, Google and Yahoo.

Showing the most improvement during the first quarter of the year, AOL's home page had one of the highest proportions of oversized/custom ad units at 26%. It also had the highest percentage of purely brand-focused advertisers, which Macquarie views as a positive indicator of ad quality.

"While Project Devil (http://advertising.aol.com/creative/projectdevil) sightings on the home page were very scarce in (the first quarter), we believe AOL has had more success with Devil across AOL's other properties, and we expect to see them increase this in (the second quarter)," says Macquarie analyst Ben Schachter. "The bottom line is that AOL's display business is trending well, and we believe we are past the worst in terms of growth."

Based on new data, Macquarie expects Yahoo's first-quarter display growth to come in slightly better than its 11.5% year-over-year growth estimate. In particular, Yahoo performed unusually well with Auto advertisers, as they accounted for 31% of total first-quarter ads, per Macquarie.

Macquarie, meanwhile, considers YouTube somewhat of a disappointment in this sense: its ability to diversify its advertising base on the home page slipped versus the fourth quarter.

"This may be seasonal, and it probably does not indicate any revenue weakness, but with 62% of its ads coming from media companies versus 50% in (the fourth quarter), we would prefer to see its vertical diversification increasing," Schachter says.

Also working against YouTube, Macquarie found that more expensive custom ad units accounted for just 2% of all ads in the first quarter versus 21% during the second half of the fourth quarter.

Worse still, among the sites analyzed by Macquarie, MSN continues to have the highest proportion of non-rich media ads on its home page, which it views as an indication of low ad quality.

Overall, use of oversized/custom ad units during the first quarter of the year were on par with the third quarter of last year.

"All else equal, we view a higher percentage of oversized/custom ads as a bullish indicator for home page ad buys and a positive read-through for display advertising more broadly," according to Schachter.

(Source: Online Media Daily, 04/05/11)

Delivering Value in a Multi-Platform World

If there is one thing I learned after spending several days at the Digital Publishing Summit 2011 in Deer Valley, Utah, it's that the people in this industry really love what they do. It's not easy walking past world-class spring skiing in what is arguably the United States' best ski area to enter a dim conference room to listen to a speech on "Auto-nomous Data Management," but every session played to an SRO crowd of media and technology executives.

The crowd was a veritable who's-who of the "Digital Display Advertising Landscape" (LUMA) map, so I suppose you could argue that these guys got where they are today by skipping lots of fun, and building advertising and media technology instead.

Among the highly informative (albeit sometimes sales-y) content at the conference, there were some gems to be had. So, here is DPS 2011, organized by quote:

"Value is shifting from those that produce the content, to those that deliver the experience of consuming it." -- Saul Berman, IBM

Saul Berman's keynote address touched upon the disruption happening in our space, but even the overhyped keyword "disruption" doesn't touch upon the true chaos happening as publishers learn how to navigate the through all the new social media, exchange-based sales, and various technology partnering opportunities out there.

Do you make Facebook Connect your friend (as Kristine Shine from PopSugar Media does) to drive new unique visits and build your audience? According to Shine, for her organization, the call was to "go all in" with Facebook. For others, like Todd Sawicki, CRO of Cheezburger, Facebook can kill publications by migrating all of their native traffic (like message board comments) to their environment, without returning the favor.

For publishers, the challenge is not just continuing to produce quality content, but to make it for a multi platform world, where consumers are just as likely to value the way they are consuming it. That means having a multi-platform approach -- and a multi-revenue approach as well. Why does a full song from iTunes cost $0.99, but a 10-second sliver of that song, sold as a ringtone, cost $3.00? In that case, it is the application of content in a clever way that adds value, a nice use case for anyone monetizing content in an experiential way.

"Media will be sold like pork bellies." -- Frank Addante, Rubicon Project

There was quite a bit of discussion around pricing at the conference, and the founder and CEO of the Rubicon Project was not wrong in insisting that, without significant changes, media would indeed be as commoditized as the humble pork belly.

Unfortunately, this trend has already happened. Addante was right to highlight the unfortunate fact that the same article in The New York Times commands a $20 CPM in print as opposed to $2 CPM online. That value gap, Addante argues, can be closed by "realizing the true value of digital experiences."

Rubicon would like to see one big gigantic "open market" that enables the industry to expand the digital advertising pie from $40B to $400B with full participation, but the details were cloudy. If that market concept involves having publishers suddenly not to sell their entire remnant inventory into an exchange, then maybe we can avoid the pork bellies fate.

Addante may be on to something, however. What the industry needs is one trusted third party aggregate high quality inventory, and create value around it, but that battle is in its very nascent stages.

That being said, a good bit of the conversation was around pricing. Both Saul Berman and Tim Cadogan of OpenX deployed the airline pricing scenario, to argue for dynamic pricing models. For Cadogan, three levels of inventory equate to three levels of seating: Exclusive (first class), Premium Guaranteed (business class), and Non-Guaranteed (coach). Just as airlines frequently change the configuration of their seating to account for their routes, seasonality and passenger mix, so must the industry dynamically price inventory, based on its placement and value.

The OpenX Enterprise server hopes to achieve that by putting guaranteed and real time exchange inventory into the same platform, and use smart decisioning technology to maximize yields. A very smart idea.

For Berman, it was not only about "having five different passengers, paying five different prices," but also about exploring entirely new revenue models, like Apple did in "switching the razor blade model" with the iPhone (expensive "razor," cheap "blades"). Publishers must go beyond monetizing their content through advertising, and start looking at generating revenue from the larger "marketing" bucket. Right now, that is called "selling apps."

"Premium brands need to be associated with premium content." -- Eric Klotz, Pubmatic

Truer words have never been spoken. Klotz explored some recent survey data which asked publishers and advertisers how the way they are buying media is shifting. The results were fairly predictable: more and more budget is finding it's way into real-time bidding environments, as brand and direct marketers seek new ways to target their desired audiences.

That's nothing new. What is changing rapidly, however, is that all marketers are demanding more placement control, increased transparency, and brand safety. Brands want the same direct connections with publishers they have enjoyed with guaranteed buying, with the ease and cost efficiency of exchange-based buying. The takeaway? If you are a publisher and not looking at building private exchange connections with your demand side partners, you are in trouble.

That sentiment was hinted at in a panel called "Selling in a Cluttered Market." For Jonas Abney of Hachette Filipacchi, "general content gets beaten by specific content every time." Marketers are looking for laser-focused, topical content that captures user intent, rather than more generalized content.

Moreoever, today's advertising sale is more educational than ever. For panelists like AdMeld CEO Michael Barrett and PubMatic's Andrew Rutledge, a sales force cannot simply have media experience -- they have to know the ecosystem, and be prepared to add value by educating clients.

For Whitepages VP of Sales Craig Paris, it is simple math: Agencies get more than 100 unique sales calls a month, from an increasing amount of new technology and media companies. Unless you differentiate yourself, you are not going to win business. "Thirty percent of your day should be spent reading the industry trades so you can have credibility, and provide insights to your customers."

"Nielsen says people visit 2.9 sites a day, and one of them is Facebook." -- Greg Rogers, Pictela

Last minute speaker Greg Rogers of Pictela provided some insights on how premium advertising units (specifically the new IAB 300×1050 "Project Devil" unit from AOL) can drive user engagement. If the above quote is true, it means that brands have to find a way to engage the user more deeply on the sites they visit every day, and that way is through interactive units.

Rogers has data that points to "dramatic" CPM increases from premium RM units, and makes a case for replacing three 300×250 units with the single 300×1050 "devil" slot. Patch and Huffpo have seen great results, and advertisers are getting good engagement and plenty of reporting.

Highly premium, brand-safe, engaging advertising...sounds like something from the past called "premium guaranteed." I bet PopSugar's Shine would agree. She has built a virtual in-house agency to build premium campaigns for her customers, and demands "150% control over every ad unit on the page."

"Cookie targeting doesn't scale." -- Michael Hannon, Aperture

Sort of a dark horse moment for me was Michael Hannon's first slide, which threw down the gauntlet on cookie targeting. All the energy in the space for the last several years has been about targeting using third-party data.

But what if it doesn't work? This is the 900-pound elephant in the ecosystem. Not only have many marketers had difficulties achieving significant scale when overlaying data on top of exchange buys, but the legislative tsunami of "Do Not Track" threatens to reduce that scale even further. Hannon makes an elegant argument for real audience measurement, and doing so in a cookie-less way.

That leads me to a great conversation led by Alan Chappell, a lawyer specializing in just these types of issues. In a room full of ad publishing and ad technology executives that depend on using data to identify target audiences, there was a great deal of confusion regarding how our industry is getting on top of what may be a very severe problem.

More direction from the IAB in the form of specific self-regulatory principles and mandates is needed, and needed fast. For Chappell, inaction may cause the "privacy disaster, which enables Google, AT&T, and Facebook to own all the data," leaving the rest of the industry on the side.

(Source: Chris O'Hara, Adotas, 04/04/11)

Rushing to Judgment

As a salesperson, you should work to focus all of your attention on your customer and his/her needs. It's all too easy to swoop in to present a solution instead of listening to your customer's complaints and the specifics of his/her situation.

In this rush to cut to the chase, you're in danger of coming across as arrogant, and your customers end up feeling their input is unimportant and unappreciated. This understandable mistake happens for two reasons:

* You want to come off as the "expert" or "hero," showing off all your knowledge by providing the solution before your customer even has a chance to finish her thought.
* You're in a hurry and don't have the time and energy to devote to your customer.

For example, let's say you're about to leave for a week's vacation when a prospective customer calls. He starts to go into a long story about his business and all the problems he's encountered in the last five years. You realize that you have heard his story -- or at least a similar one -- many times before, so you interrupt him to give your answer to his problems. You try to end the call as soon as possible so you can leave for vacation.

In this case, even though you might have given your prospect a good solution, chances are he won't feel satisfied with the conversation. He didn't have an opportunity to tell you about his business, so he feels shortchanged.

What should you have done? Next time, embrace any information your prospect gives you, whether you believe it's valuable or not. If you truly didn't have time to talk at length with this prospect, you should have requested the opportunity to call him back after you returned from vacation. Otherwise, you should have put down your briefcase, closed your office door, and listened to him for as long as he needed.

Remember, even if you hear the story all the time, it is unique and personal for each customer. Instead of interrupting your customer with your standard solution, let him have the floor and explain his problem. Only then can you proceed with the process of finding a solution for whatever ails him.

Fortunes of Home Improvement Chains Improve as Americans Tackle Repair Projects

After several years of perusing real estate listings and spending Sunday afternoons at open houses, Denise Majeski decided to stay put and fix up her 25-year-old Gurnee, Ill., home.

As the housing market languished even as the economy improved, Majeski determined the financially prudent course would be to fix up the house a little at a time, starting with replacing the windows and renovating the bathrooms.

"Initially we were thinking about moving," said Majeski, 55. "But that would require a mortgage and additional amounts of money. We can do a home improvement at a pace that we can afford."

It is a choice more homeowners are making these days and one that is lifting the fortunes of the long-suffering home improvement industry.

Seasonal hiring at Lowe's Cos., the nation's No. 2 home improvement retailer, is up 15% this spring as homeowners, feeling more secure in their jobs, tackle maintenance projects delayed during the recession.

And Home Depot Inc., the largest home improvement retailer, in February reported its first annual sales increase since 2006, before the housing market crashed. The home improvement business is stabilizing despite the continued weakness of the housing market, Home Depot Chief Executive Frank Blake said at the time.

"People are doing what it takes to be happy where they are," said Jack Horst, retail strategist at Kurt Salmon, a consulting firm. "They are more likely doing maintenance and replacement than big fundamental changes."

A few buckets of paint, brighter lighting and some new door handles are enough to make Rebecca and Bill Klies happy in their new home. The couple, in their 30s, bought their first condo last October in a short sale, in which a lender allows a homeowner to sell a property for less than the amount owed on the mortgage.

Now the Klieses spend weekends at Home Depot and Lowe's getting ideas on how to fix up their West Loop loft in Chicago without spending a fortune. They've swapped out light fixtures, recaulked the shower, put up new towel racks, installed a ceiling fan in the bedroom, bought new light switch plates, painted several rooms and touched up the molding.

"These are simple little fixes that make a big difference overall," Rebecca Klies said.

At the same time, home improvement stores are getting an extra sales boost as homeowners dig out from a winter of lengthy cold spells. The severe weather has left shingles, gutters and downspouts in need of repair and lawns littered with broken shrubs and damaged trees.

"These are the have-to-do projects," said Jim Kane, president of Home Depot's northern division. "We've just come through a tough winter, and the winter has just taken its toll on all those things."

Maintenance and repairs account for about 40% of Home Depot sales, up sharply from recent years when home sales slowed, said Daniel Binder, an analyst at Jefferies & Co., in a report last month.

Spending on home remodeling is expected to rise 9.1% in the first quarter to $125.1 billion from the same period a year ago, according to a widely followed index from Harvard University's Joint Center for Housing Studies. The last time remodeling activity for a three-month period topped $125 billion was the second quarter of 2008.

The center predicts the industry to gain momentum this spring with sales jumping 12.7%, to $132.9 billion, in the second quarter from a year ago, before tapering off to a 6.5% gain, to $123.5 billion, in the third quarter.

More homeowners are tackling basic house projects on their own instead of using general contractors, bringing in electricians or plumbers only for the toughest jobs, said Rich Cowgill, Chicago-area chapter president of the National Assn. of the Remodeling Industry.

Cowgill said he had noticed an increase in the size of the do-it-yourself classes he teaches as a volunteer at ReStore for Habitat for Humanity as more homeowners try to lay tile, replace windows or put up drywall.

"People are dressing up their homes because they've come to the realization with housing devalues that they're not going to move," said Cowgill, who also owns a home remodeling business.

Kris and Dennis Cortes of Flossmoor, Ill., are typical of the post-recession home remodelers, industry experts said. The parents of five children said they chose to stay in the home they bought 20 years ago and to give the house a face-lift. They are adding a couple of gables to the roof, installing a new garage door and updating the landscaping.

"We could buy the megamansion, but we choose not to," said Kris Cortes, 46. "We're choosing to allocate our resources more toward education, charity and savings. I do think the country at large is headed in that direction."

(Source: Chicago Tribune, 04/13/11)

The Pre-Call Strategy Session

One of the most important components of the sales call that will help you close more business is the pre-call strategy session.

The pre-call strategy session consists of the following four steps:

1. Know what questions you will ask and anticipate responses. Your questions must be designed to get the prospect to verbalize their compelling reasons for meeting with you relative to their problem or, as I call it, severe mental anguish (SMA). Additionally, you must ask all of the pertinent questions about their current provider (your competitor), the capacity for change in the organization (time, money and resources) and the decision-making process. Those questions and their related answers will enable you to disqualify the prospect early in the process and eliminate stalls and objections at the closing.

2. Anticipate what questions the prospect will ask and practice your responses. Your responses should often be clarifying questions that will help you understand completely what is underneath the prospect's question.

3. Anticipate "curve balls" that the prospect may throw you. For example, you may find out, at the final presentation that the decision-maker is not going to be present. What will you do? You must anticipate and prepare.

4. Role-play the call. Decide, as a general practice, that any sales opportunity exceeding a certain dollar amount will be subject to intense role play and strategy development prior to it. Role-play with a peer or your manager.

If you are a new salesperson, you may not have a problem with implementing this pre-call process. However, if you are an experienced salesperson, it is easy to feel like you are beyond this rehearsal process because you've been selling for so long that you "know what will happen." I challenge you to think about all professional athletes or musicians who practice for hours each day and rehearse for each and every competition or performance. I hope you will adopt the mantra "Perfect practice makes perfect performance" and become a true professional salesperson.

Study Examines Gender Differences in Vehicle Purchases

TrueCar.com, a provider of new-car pricing and industry trend information, recently released a demographic study based on gender differences in car-buying behavior during 2010.

"The study shows that women car buyers are more cost-conscious and purchased fuel-efficient vehicles while male buyers were completely the opposite, purchasing vehicles that were either big and brawny, like a large truck, or choosing a high-priced, high-performance vehicle," said Jesse Toprak, Vice President of Industry Trends and Insights at TrueCar.com.

Some of the key findings of the TrueCar.com study, which was based on over eight million retail purchases in 2010, include:

• The brand with the highest percentage of retail sales to females in 2010 was MINI (47.9 percent), followed by Kia (46.8 percent), and Honda (46.0 percent) compared to 2009 when Saturn and Kia tied at 45.2 percent and MINI came in third at 45.0 percent. Rounding out the top 15 brands in 2010 were Nissan, Subaru, Suzuki, Hyundai, Mercury, Mazda, Mitsubushi, Lexus, Volkswagen, Volvo, Saturn and Toyota.

• The highest percentage of male buyers primarily purchased exotic brands. There were five brands in 2010 at 10 percent or less for retail sales to women, including Ferrari (6.4 percent), Lotus (7.2 percent), Lamborghini (7.4 percent), Maybach (8.0 percent), and Rolls Royce (9.3 percent) compared to 2009 when there were six brands; including Bugatti (0 percent), Maybach (3.7 percent), Ferrari (5.1 percent), Lamborghini (5.5 percent), Rolls Royce (8.0 percent), and Aston Martin (9.0 percent). Also in the top 15 brands with the highest percentage of male buyers in 2010 were Tesla, Aston Martin, Maserati, Porsche, Bentley, GMC, Jaguar, Dodge, Land Rover and Ford.

• The top ten models that had greater than 50 percent retail sales to females and at least 1,000 annual retail sales in 2010 were: Volkswagen New Beetle, Nissan Rogue, Volkswagen Eos, Volvo S40, Jeep Compass, Honda CR-V, Nissan Sentra, Hyundai Tucson, Toyota RAV4 and Toyota Yaris.

• The top ten models that had greater than 50 percent retail sales to males and at least 1,000 annual retail sales in 2010 were: Porsche 911, GMC Sierra, Chevrolet Corvette, Chevrolet Silverado, Ford F-Series, BMW M3, Ford Ranger, Toyota Tundra, Dodge Ram and Audi S5.

(Source: TrueCar.com, 04/07/11)

Auto Sales May Top Analysts' Earlier Estimates

U.S. automobile sales this year may rise faster than analysts had earlier anticipated as the improving job market prevents higher gasoline prices and supply disruptions in Japan from derailing the industry's recovery.

Total sales of cars and light trucks may rise to 13 million this year, the average of 18 analysts' estimates compiled by Bloomberg. The average estimate was 12.9 million in a Bloomberg survey of 17 analysts in January. Light-vehicle sales last year rose to 11.6 million from a 27-year low in 2009.

Auto sales ran at a seasonally adjusted annual rate of 13.1 million in the first quarter, the fastest pace since the quarter ending June 2008, according to Autodata Corp. Demand held up while gasoline prices rose to the highest level in more than two years and Japan's earthquake disrupted production and tightened inventories of some models.

"Despite it all, people still need cars," said Jessica Caldwell, an analyst at industry researcher Edmunds.com, which kept its estimate at 12.9 million. "There's still that issue of pent-up demand that we see in the marketplace that you can't ignore."

The U.S. economy added jobs for six consecutive months through March, with payrolls rising by 478,000 in the first quarter, and the unemployment rate fell to a two-year low of 8.8 percent, according to Labor Department figures.

Seven analysts raised their estimates for full-year auto sales since the beginning of the year. IHS Automotive lowered its estimate to 12.9 million vehicles, from as high as 13.3 million in February, citing higher oil prices and disruptions following Japan's earthquake.

Oil prices, Japan
The higher cost of oil accounts for a 150,000-vehicle reduction in IHS's estimate, and Japan-related production losses account for the remainder, said George Magliano, a New York-based senior economist for the researcher.

"We're a little more optimistic on the job market, which we think has finally turned," Magliano said in a telephone interview. "Credit has begun to loosen up a bit more. That made us feel better about where the year was going. Now, we've got two things working against us."

U.S. consumer borrowing rose for a fifth straight month in February on an increase in non-revolving credit, which includes borrowing for autos, the Federal Reserve reported April 7.

Lenders began expanding credit to new-car buyers last year, according to Experian Automotive, which tracks auto-lending data. Buyers with nonprime or weaker credit scores accounted for 19.8 percent of the new-vehicle financing market in the fourth quarter, up from 16.8 percent a year earlier, Costa Mesa, California-based Experian said.

Credit expands
"The lenders are coming to the consumers, and the consumers are doing everything they can to improve their standing so they can hopefully meet in the middle," said Dan Montague, an analyst at the Autofacts forecasting unit of PricewaterhouseCoopers LLP, which raised its estimate for full-year deliveries to 13 million from 12.5 million.

Ford Motor Co., the second-largest U.S. automaker, closed its truck plant in Louisville, Kentucky, last week because of a Japan-related parts shortage. The factory makes F-Series pickups and the Lincoln Navigator and Ford Expedition SUVs, according to Ford's website.

General Motors Co., the largest U.S. automaker, also reported production disruptions the week of March 21 at its pickup plant in Shreveport, Louisiana, and factories in Zaragoza, Spain, and Eisenach, Germany.

'Temporary' Japan impact
Toyota Motor Corp. has said it lost 140,000 units of production from March 14 to March 26, citing a shortage of electronic parts, rubber and plastics. The company said on Monday it may lose output of 35,000 vehicles at its North American factories through April 25.

A shortage of vehicles for Japan-based automakers including Toyota, Honda Motor Co. and Nissan Motor Co. will be a temporary headwind, said Efraim Levy, an analyst with Standard & Poor's Equity Research, which kept its 13 million 2011 sales estimate.

"There will be some makeup of those sales in the second half of the year, but in general consumers will mostly opt to find an alternative vehicle and purchase now, rather than wait," said Levy, who's based in New York. "That's a potential benefit to U.S. and Korean automakers and a minor impact on overall sales for the year."

GM repeated this month its forecast that sales this year may be as much as 13.5 million when including medium- and heavy-duty trucks. A "significant slowdown" as a result of the Japan earthquake is unlikely, Don Johnson, Detroit-based GM's vice president of U.S. sales, said on a conference call.

Pent-up demand
"The biggest problem I have is not having enough cars, and that's about the best problem to have," said Robert Morris, president of a Cadillac, Buick and GMC dealership in North Olmsted, Ohio, near Cleveland. "People can only stay down for so long before they just kind of snap themselves out of it. The pent-up demand is breaking loose."

The sales estimates compiled by Bloomberg range from as high as 14 million predicted by Morgan Stanley to 12.6 million projected by AutoPacific Inc.

More of the labor force is settling for part-time work, which is skewing a recovery in the job market, said Ed Kim, an analyst at AutoPacific in Tustin, California.

"Part-time work generally doesn't cut it as far as having the income necessary to buy a new vehicle," said Kim, who raised his estimate to 12.6 million vehicles from 12.4 million at the beginning of the year. "I don't think that necessarily translates into a significantly higher number of consumers who can buy a new vehicle now."

(Source: Bloomberg, 04/11/11)

Polk: Automakers Improved Brand Loyalty in 2010

Automakers' efforts to retain customers are paying off, according to an R.L. Polk & Co. study, as nearly half of last year's customers bought or leased a vehicle of the same brand they had before.

Overall, Polk found that industry brand loyalty rose from 45.8 percent in 2009 to 47.9 percent in 2010 -- a 4.6 percent increase.

"Historically, we've just let loyalty happen and measure it on the back end," said Brad Smith, director of Polk's loyalty management practice. "What we're seeing now is more manufacturers actively managing loyalty and trying to influence it."

In the study released March 31, Ford Motor Co. topped General Motors as the manufacturer with the strongest customer loyalty in 2010.

Last year, Ford increased its loyalty to 63.1 percent, up 3.9 percentage points from the previous year. At the same time, GM's loyalty remained at 59.9 percent.

Toyota Motor Corp. ranked third at 58.8 percent, down 0.4 percentage points from 2009. The small loss in owner loyalty is not indicative of initial customer desertion after the automaker's recall campaign in 2009 and 2010, Smith said.

"Reality is, Toyota did a fabulous job of addressing those recalls. They made sure to get the word out about what products were affected and they issued more incentives than they ever had previously to keep customers coming back," he said. "I think if the recalls were having that big of an effect we would have seen much higher defection in customer loyalty."

Determining loyalty
When Polk looks at manufacturer loyalty, it separates GM, Ford, Toyota, Chrysler Group LLC, Nissan Motor Co. and Honda Motor Co. from other automakers because they have so many brands associated with them, Smith said.

"In those instances there is more opportunity for owners to be loyal to a given manufacturer," Smith said. "It's making sure you are doing a relative comparison between the populations."

Polk determines loyalty by looking at the number of households that had previously bought a new vehicle and returned to the market to lease or buy another new vehicle of the same make or nameplate in 2010. Polk studied purchase behavior in 5.2 million households between January and December 2010.

Ford also ranked as the most popular brand in the study, bringing back customers 60.3 percent of the time, an increase of 4.5 percentage points from 2009. Mercedes-Benz was the second most loyal brand, up 2.1 percentage points from the previous year to 56.7 percent. Honda came third with 56.6 percent loyalty, an increase of 1.1 percentage points. Toyota had a slight decrease in loyalty, dropping 0.4 percentage points to 56.4 percent, but keeping it among the top brands. Coming in fifth was the Chevrolet brand, up 1.4 percentage points to 53 percent loyalty.

Product drives owner loyalty, Smith said, and Ford's refreshed lineup and telematics systems have brought it success in that area.

"Ford had flawless execution with the introduction of Sync and MyFord Touch," he said. "Those product introductions and the buzz surrounding those new product introductions through advertising and marketing drive owner loyalty."

The Chrysler brand's results weren't as favorable. Loyalty fell 0.4 percentage points in 2010, to 23.8 percent. Other brands with declining loyalty in 2010 were Volvo, Audi, Mini, Smart, Hummer, Saab and Suzuki.

Rising to the top
Polk also assessed nameplate loyalty, finding that customers overall were 2.3 percentage points more likely to return to the same nameplate than in the previous year.

The Mercedes-Benz E class topped the nameplate loyalty list with a 7.3 percentage point increase to 44.2 percent. Ford's F series line of pickups was second, rising 5.6 percentage points 42.4 percent. Third was the Lincoln MKZ, seeing a 16.2 percentage point loyalty spike to 41.6 percent.

Smith said he is not surprised the MKZ popped to near the top.

"Ford is not just focusing on the Ford brand in terms of retaining their owners," he said. "They've put some plans in place to make sure that with the termination of the Mercury brand they're going to do everything they can to get those Mercury owners into a Ford or a Lincoln when they return to market."

(Source: Automotive News, 04/04/11)

Easter Sales Continue Climb to Pre-Recession Levels

Not since 1943 have Americans seen an Easter fall this late in the calendar, but it seems the delayed holiday won't impact consumers' eagerness to spend on décor, food and even new spring apparel.

According to the National Retail Federation's 2011 Consumer Intentions and Actions survey, conducted by BIGresearch, the average consumer is expected to spend $131.04 on everything from candy to clothes -- up from last year's $118.60 but not quite to pre-recession levels. Total spending on Easter related merchandise is expected to reach $14.6 billion.

"Due to such a late holiday, Easter promotions will last all spring long," said NRF President and CEO Matthew Shay. "Though lingering concerns over food and energy prices may keep shoppers from splurging, retailers are expecting consumers to stock up on apparel, home décor and of course food and candy, a good sign leading into the much busier and important months to come."

Food and candy will account for most of a consumer's budget, bringing in $2.1 billion in candy sales and $4.5 billion in food sales alone. The average person will spend slightly more on each than they did last year -- $18.55 on candy, compared to $17.29 last year, and $40.05 on food, up from $37.45 last year.

Many Americans will take advantage of retailers' spring sales to buy new clothing for the entire family. The average celebrant will spend $21.51 on colorful new apparel, up from last year's $19.03 and totaling $2.4 billion in sales. Additionally, consumers will spend an average of $9.02 on flowers, $8.00 on decorations and $6.79 on greeting cards. Children looking forward to a visit from the Easter bunny this year are in for a treat: spending on gifts will reach an average of $19.89, totaling $2.2 billion.

Department (36.6%) and discount stores (62.6%) will be the most popular shopping destinations for Easter gifts this year, though specialty stores carrying flowers, jewelry and electronic merchandise will also see their share of traffic (22.4%). Others will shop at specialty clothing stores (8.1%), online (14.8%) and through a catalog (3.5%).

"When out shopping for their Easter meals, many Americans will also be swayed by other items that remind them of warm weather celebrations, including apparel and home and garden accents," said Phil Rist, Executive Vice President, Strategic Initiatives, BIGresearch. "While spending is expected to improve from the past two years, families are still sticking to a budget with an eagle eye on low prices."

The survey also found that Easter's biggest spenders will be 25-34 year-olds ($173.41 vs. $136.79 last year) and young adults 18-24 ($145.12 vs. $125.85). Thirty-five-to-44-year-olds will spend an average of $138.55, followed by 45-54 year olds ($122.15) and 55-64 year olds ($113.32).

(Source: National Retail Federation, 04/07/11)

Cheers: Alcoholic Beverage Spending Increases

2010 was a positive year for alcoholic beverages, with the exception of non-craft domestic beers, according to the just-released "Handbook Advance 2011" report from the Beverage Information Group (BIG).

Meanwhile, a new Harris Interactive poll on Americans' alcohol consumption habits provides some additional insight. Notably, 29% of those 21 or older -- or three in 10 -- report drinking alcohol at least once per week, including 5% who drink daily and 10% who drink several times per week.

The Beverage Information Group reports that distilled spirits and wine both saw gains last year, continuing to grab share from the overall beer category. The analysts attribute the trends largely to the improving economy and a return to a "trading up" trend that had dominated the industry prior to the recession.

Distilled spirits -- which have seen steady growth over the past two years and 13 consecutive years of at least some growth -- saw sales increase 2.1%, to 192.7 cases, last year. On-premise or restaurant/bar consumption of distilled spirits also showed a slight uptick, especially in casual dining chains.

The wine category saw consumption grow by 1.7% (up from 0.8% in 2009), to 301.9 million 9-liter cases. Domestic table wines showed a particularly strong performance, outpacing imports.

Wine sales continue to increase in large part because of the wide range of products and growing number of available varietals, notes BIG manager of information services Eric Schmidt. "The Millennial generation continues to be a target for wine marketers as they position their brands as affordable and fun," he points out.

Total beer consumption declined 1.9% to 2.83 billion cases, although imports returned to showing some sales growth, in part because consumers are returning to on-premise consumption, according to the report.

Domestic beer consumption decreased 2.8%, with all categories showing declines except the super-premium, craft and flavored malt beverages category, which continued to see growth due to the craft beer segment.

Craft beers' growing popularity has been well documented, and spotlighted by developments such as Anheuser-Busch InBev's recent announcement that it is acquiring Chicago craft brewer Goose Island for $38.8 million as part of a broader strategy to increase its premium/craft offerings.

The Brewers Association reported that sales volume among small, independent craft brewers rose 11% last year, in contrast to a decline of 1% among total U.S. brewers (although crafts still represent just 4.9% of the overall beer market). MillerCoors' overall sales declined 3%, but its craft and import brands, led by Blue Moon (now the country's largest-selling craft -- at least as defined by MillerCoors), saw double-digit growth, The Wall Street Journal reported.

Who's drinking what?
On the consumption front, in addition to the stats cited above, the Harris Poll -- conducted online in March -- also found that 20% of adult Americans report drinking alcohol at least once per month, and 15% drink it several times per year. Nearly one-quarter (22%) say they never drink alcohol.

Nearly two in five men (38%), versus 21% of women, report drinking alcohol at least once per week.

And while overall beer sales have slowed, among those who imbibe at least several times per year, beer is the top choice. Nearly two-thirds (63%) report that beer is their choice when they drink, while 54% report drinking domestic wine. In addition, 41% drink vodka. These top three preferences have remained consistent over the past two years, according to Harris.

As for other choices, about one-third (34%) drink rum, 28% tequila, 28% imported wine, and 20% various types of whiskies, such as Irish or Canadian. Further down the list are champagne (17%), cordials and liqueurs (17%), bourbon (15%), gin (14%), scotch (11%), cognac (8%) and brandy/Armagnac (7%).

More men than women drink beer (75% versus 50%), bourbon (23% versus 6%) and scotch (17% versus 4%). More women than men drink domestic wine (63% versus 45%), champagne (23% versus 13%) and foreign wine (31% versus 26%).

Beer comes out on top when people are asked which type of alcoholic beverage they drink most often. One-third of those who drink at least several times a year (34%) say they drink beer most often, versus 22% saying they drink domestic wine most often. One in ten (12%) drink vodka most often, versus 6% for rum and 5% for imported wine. All other alcohol types are below 5%.

Alcoholic beverage consumption declines somewhat with age: 33% of Echo Boomers (21-34), 30% of Gen X/Millennials (35-46) and 29% of Baby Boomers (47-65) report drinking at least once per week, versus 26% of those 66 and older.

Beverage choices clearly vary by age. Beer is the dominant choice among the youngest groups, with 37% of Echo Boomers preferring beer (versus 20% preferring domestic wine), and 41% of Millennials preferring beer (versus 14% preferring wine). The beer preference is somewhat less marked among Boomers, with 33% saying they drink beer most often versus 22% who report drinking domestic wine most often.

However, among those 66 and older, wine is the preference of 36%, versus 22% who prefer beer.

(Source: Marketing Daily, 04/06/11)

Low Interest Rates Cannot be Dictated

Let's improve Americans' health by drastically reducing everyone's weight, significantly increasing longevity and reducing medical costs.  All we need to do is revalue the pound.  Instead of a pound being 16 ounces, it will now be 32, cutting everyone's weight in half.  We adjust our bathroom scales, our weight drops, and our health is improved.  Of course this "solution" rests on two fallacies, says Richard W. Fulmer.

• First, it conflates measurement with what is measured --adjusting your bathroom scale does not change your weight, only your perception.
• Second, the solution confuses cause and effect --weight is not necessarily the cause of health or lack thereof.

The two fallacies are so obvious that no one could possibly fall for them, right?  Sadly, no.  Many brilliant people have fervently believed in nearly identical fallacies for decades and are even now basing our country's monetary policy on them.

• Historian T. S. Ashton noted: "If we seek... for a single reason why the pace of economic development quickened about the middle of the eighteenth century, it is to low interest rates we must look."
• John Maynard Keynes, making this same observation years before, concluded that simply by manipulating a country's monetary supply and financial markets to produce artificially low interest rates, infrastructure would spring into being.
• But Keynes is confusing "cheap capital" with easy money.
• Capital must be produced through saving, that is, deferred consumption.

Dictating low rates will not improve a nation's fiscal health any more than manipulating your bathroom scale will improve your physical health, says Fulmer.

Source: Richard W. Fulmer, "A Simple Solution," Freeman Online, April 11, 2011.

Super-Charge Product Sampling, Event Marketing

There's been a lot of research conducted to figure out what consumers want from brands on social media networks such as Facebook. What can the brand provide? What type of value can it add? One of the most frequently cited is the coupon -- which is a bit underwhelming, leaves the brand out of the conversation and may be leaving dollars behind, too.

Consumers don't go to the web to talk about brands (unless they're complaining); they go to share their experiences. A better way to get consumers talking about brands online is to give them something to talk about in the first place.

Product sampling and event marketing have long proven to be the most effective way to generate trial and drive purchase conversion. Nine out of ten consumers say they would purchase a product if they experienced it and were satisfied with it, says the Promotion Marketing Association. And today, social media tools can extend the story on a scale never before imagined. Once the products are distributed, consumers can and should be encouraged to share their experiences online. We all know the power of word of mouth to generate trial and use. Nielsen reports that eight out of ten consumers say they'd try products recommended to them.

Sounds simple, but don't think you can merely hand your product or share your experience with savvy, time-crunched consumers and expect that they'll automatically try it and then talk about it on Facebook. The most effective sampling efforts reach consumers at the point of use, when and where they are most receptive to the brand's message. For example, 40% of travelers forget to pack toiletries. Giving away a razor or toothbrush in hotels can go a long way; hotel gift shops are so expensive. Provide an energy drink or other healthy snack at the top of a ski slope. You get the idea.

Then what? Once you've identified where your consumers are open to trying new things and what their needs are, give them a reason to share their experience. Research tells us that consumers are happy when they're heard and respected. But you've got to make it easy for that sharing to happen and for them to be heard.

Drive consumers to a powerful online engagement platform that enables them to share their opinions across their social media profiles. Once there, give your new brand advocates space to write what they think, through free-form comments and with relevant surveys.

Programs designed with this model consistently demonstrate a swift increase in conversations and reviews across social media channels and significant increase in intent to purchase, to recommend the product, and an increase in share of voice over the competition. A nutritional supplement brand using this method saw Facebook fans increase 94%, and 85% said they intended to purchase the product. A razor brand increased share of voice to competitors by 18%.

Bottom line? The most authentic way to get someone to provide a recommendation is to get him or her to experience the product, first-hand. Then, their review is real. It's authentic. Offering a coupon on Facebook is like dropping in on a cocktail party conversation without being invited. Give them something meaningful when they want to receive it, ask them what they really think, and have the tools at the ready that enable them to share their opinions with their friends with ease. That's authentic engagement that delivers a real return on your marketing investment.

(Source: Marketing Daily, 04/06/11)

The Case for an Open Fuel Standard

Like every president who has addressed the issue of our country's energy future since Richard Nixon, President Obama focuses on the source and level of our oil imports.  But these are not the keys to overcoming the security and economic vulnerabilities that oil causes, according to James Woolsey, a member of the Hoover Institution's Task Force on Energy Policy, and Anne Korin, codirector of the Institute for the Analysis of Global Security.

• The Organization of the Petroleum Exporting Countries (OPEC) dominates the global oil market and sits on 78 percent of the world's conventional oil reserves.
• But it only accounts for about a third of world oil production because it is a conspiracy in restraint of trade.
• When non-OPEC countries drill more, OPEC simply drills less and drives prices back up.
• If demand is reduced through a one-time improvement in efficiency, OPEC again drills less and prices zip back up.
• Even if the United States did not import a drop of oil, we would still be vulnerable to the vagaries of the oil market and price manipulation by OPEC.

Oil is a presidential concern because its virtual monopoly over transportation fuel makes it a strategic commodity.  We must break oil's stranglehold on the global transportation fuel market by ensuring that new cars allow fuel competition.  One very good way to accomplish this is for Congress to adopt the Open Fuel Standard Act, says Woolsey and Korin.

• An Open Fuel Standard would require new cars to include a $100 tweak that would allow them to run on a variety of liquid fuels in addition to gasoline.
• Such fuels would include methanol, which is easily made from natural gas and biomass (and, less cleanly, from coal).

Source: James Woolsey and Anne Korin, "The Flexible Fuel Answer to OPEC," Hoover Institution, April 6, 2011.

Radio Ads and How to Make Them Work

The most memorable commercials are ones that help people relate to where they live, chuckle a little, or laugh out loud. Don’t believe me? What spots come to mind when you think about radio? Not many, because most are ignored: they’re boring. It’s important to get people curious about your business if you want to entice listeners to drop in and look around.

Before I get down to the nuts and bolts I have to explain that you need to commit to a rotation and one spot a day on one radio station will not do it. It will take a few days to establish (have listeners become familiar with the spot), because people don’t listen for commercials, they listen for music or their favorite talk show host or the news. Now is the time to be strategic. Start with a good script—one that doesn’t sound the same as everything else!

Funny Works—Period

Ask anyone what they like about a friend and a “good sense of humor” is always on that list. This applies to you, the dealer. Have a look around the area you live and think about what people find funny around them; every city/town has something. “You’ll look great driving by the beach this summer (insert a background wolf whistle and a short chirp of tires and the sound of a fender bender) and did I mention our body shop?” or “If your car gets from zero to 60 in three out of four tries, maybe it’s time for something new!” Simple, friendly, and memorable—associate humor with your business and you win.

A local place where parking is just a pain is another angle. If you are highlighting small cars in a sale then make fun of how easy it is to find a parking space at the County Fair or something similar. “This car takes up less space than Mama’s Blue Ribbon Sow and has enough room to bring home all the stuff I bought at the pie auction!” You get the idea here too. (Funny effects help but keep them simple, not corny or cartoonish).

It’s important to remember that you get bang for your buck by spending time on the script and air time; I cannot stress this enough. A good script will keep people interested. Use a company to record and produce your spots with out of market voices to catch the listener’s attention. Yes you will spend extra, but it’s worth every penny. Commercials do cost money to produce, but the return with any radio campaign will be noticed and your spots won’t just blend in. The extra cost is small potatoes when you are buying a high frequency schedule.  Above all, continuity works.

Four Steps To Doubling Your Sales Success

The law of cause and effect states that, for every result, there is a matching effort that created it. There is no such thing as accidental success. Successful actions can be defined, implemented, and measured. Success is calculable. Step #1: You must accept responsibility Success or failure is not about economies, locations, managers, brands, or anything else you may allow as excuses. Wherever you are at in your level of success you must accept responsibility for it. One excuse can open the floodgates of failure. Don’t wait for someone or something to change your destiny. The magic bus with the magic answer will never show up. Sales people and managers switch dealerships every day for what are often the wrong reasons. Often times, a sales person switches dealerships and continues experiencing the same problems, yet masked with different faces and locations. There are only two choices you can make: One is a belief in a world based upon abundance and one is a world built upon scarcity. A world of abundance has no room or need for excuses and a belief of scarcity is based upon and requires excuses. It’s simply your free will and choice. None of your actions can create sustained success until this choice is made. Step #2: You must determine the Why of success When the why gets strong, the how gets easy. Traditional goal setting often can lead you to fail. The reason for failure is because traditional goal setting focuses on the actions. Without identifying while strongly feeling why you want something, you can only lead yourself into uninspired actions. Often these are subconscious actions destined to fail. I invite you to write down one goal for yourself. Concentrate for several minutes a day for at least a week on why you want to achieve that goal, instead of how you are to achieve it. Step #3: Determine the emotions you desire Behind every goal is a desired emotion. For example, when a person buys a vehicle, they create an image in their minds eye as to how they picture themselves in the vehicle and how they think others will view them in their vehicle. Does your goal create the feeling of being happy, secure, important, or powerful? For all of us, perception creates our reality. Step #4: Success comes from focus Success comes from dominant thoughts that support your goal. You must focus on your desire. Write down your goal and ask yourself every hour if your dominating thoughts support the achievement of your desire. Often, when you do not succeed, it’s because you have consciously chosen a goal but your subconscious does not support (or even conflicts with) your goal. The key to eliminating negative and non-supporting beliefs is to use the Law of Repetition. If you begin to repetitively think of, feel, and act upon thoughts and beliefs that support your goal, you can eliminate the negative and non-supporting beliefs you currently hold.