Tidbits #1

Writing begun at 2:04 am.

As many of you will soon notice, a certain company always leaves a pamphlet all over the School of Management. Unfortunately, the leaflet is called "Tyler's Tidbits." As much as I would love to take credit for the printing----I had absolutely nothing to do with it. It is also possible that I have answered this question more times than an average MBA can say "synergy" during a powerpoint presentation. (The record for saying "St. Louis" in a class period is 13--but I digress).

The pamphlet was troublesome but has inspired me to do a quick shot of updates throughout the year about anything I enjoy about Boston, BU, or the MBA experience in general. These will be the very quick versions of President's Corner topics and promise not to be especially serious in any regard.

For the first, I thought I'd hit on a few things that I have missed from Boston. Some of these are silly, a few childish, but all are things I'm looking forward to back in beantown.

1. My apartment
2. Sega Genesis
3. NHL '95
4. Excessively postered walls
5. Closet door improvisation
6. Cabinet space
7. Closet space
8. The CITGO sign, my beacon home
9. The Commonwealth Avenue wind tunnel
10. The T (nope, that's a lie)
11. The Laura Plattner cheer (clap, clap, clap-clap-clap)
12. BBQs on the Esplanade
13. The B.U.R.P.s
14. Jon Patterson's steak tips
15. Richard Palmer's "you love it"
16. Heated fantasy sports debates
17. Waxing philosophical with Evan DaSilva on the DH's pollution of baseball
18. Mike Hughes laughing at my indoor soccer "skillz"
19. PS2
20. My jarb in admissions
21. Hayden Estrada's musings on life
22. Temperature fluctuation (San Fran is the same every day)
23. Sunset Grill nachos
24. The FitRec
25. Numbers 23 and 24 never interacting
26. Surround sound stereo system
27. Full-sized bed
28. Boston-based redheads
29. The NHL regular season
30. Kicks and sneaks
31. Mizzou basketball on team room flatscreens
32. The Womanizers study group (blame Britney Spears)
33. Also blame Richard Palmer for #32
34. PG3's impromptu visits
35. My socially-awkward neighbor
36. The Charles River
37. Hipster watching
38. Excessive caffeination
39. Ski lodge weekends
40. David Daniel Davitt
41. Circles watching Dee-wags break it down
42. Friends' kids
43. Crazy townies
44. The back row trio
45. Cohort C
46. The new alums
47. Excessively packed tiny apartment parties
48. Being heckled while giving tours
49. The 5th floor bathrooms
50. Eastern standard time

And lastly, a few songs I can't get enough of:

Arcade Fire "Wake Up"

Bone Thugs N Harmony "First of Da Month"

311 "Stealing Happy Hours"

UGK "International Players Anthem"

The Crystal Method "Divided by Night"

Stream of consciousness over at 2: 27 am.

An Embarrassment of Riches

Almost exactly one year ago last week I began one very long cross-country roadtrip. Packing all of my belongings into a Penske truck, I set out for Boston with my best friend as a copilot. Driving twenty-five hours, straight through the night, we reached my new home at about 1am the next day--and nothing has been quite the same since.

I rolled into the city excited for a new beginning and looking forward to new opportunities but I had no idea what Boston University had in store for me. Faster than I could have possibly imagined I felt comfortable and had made new, great friends. When I first thought of writing this retrospective I knew that I wanted it serve as some kind of guide for our incoming class.

Several good friends and former "2nd years" helped me learn to take advantage of opportunities at BU and I can only hope that our class can pass along the same message. I am excited to see that some of our students have already begun planning "unofficial" social events to integrate the two classes as quickly as possible. We also have an entire group of new students to the School of Management -- the Mathematical Finance graduate students.

Especially for those students making a geographical jump, starting an MBA program is about much more than a set of classes and projects. An MBA is a chance to stretch your perspective on management and also on your own circumstances. Simply put, if someone told me a year ago that I would have the friends I have, doing the internship I am doing, and enjoying the leadership position I am in----I would have told you, (in more colorful, less-blog-appropriate language) that you were nuts.

Some of you are aware that I am an absolute sports nut (and the rest will know soon enough) and while reading an article about the Red Sox pitching surplus the other day I saw the phrase "embarrassment of riches." I absolutely love this phrase. Furthermore, I encourage every student in the graduate school to put together a group of classes, friends, groups, and careers that can only be described as exactly that--an embarrassment of riches.

Blog

After being summoned to write, start, and contribute to a growing list of other blogs, I thought I'd throw all of mine in one place.

The posts for this will come from work for the Boston University MBA Admissions blog (http://bumbastudents.blogspot.com), my professional work on Business Schooled (http://www.business-schooled.com/), and pieces as MBA Council President in "President's Corner" (http://www.smgmba.com/).

Connections, Bikes, and Ex-Pats

The following post was originally written for class participation as a part of the European Field Seminar. Boston University offers four field seminars that travel either to Europe, Asia, Brazil, or India. To see the other 16 posts from fellow attendess, head over to http://www.travelblog.org/Bloggers/2009-European-Field-Seminar-Participants.

Connections, Bikes, and Ex-Pats

Before I begin to talk about our meetings and adventures on the 8th, I have to mention my fantastic off-day on the 7th. During the fall and spring semesters I work part-time as a Graduate Assistant in the Graduate Admissions Office. As a result, I have the opportunity to meet and greet hundreds of prospective students and I get to spend even more time with them at admitted student open house events. At one of these events I met Thomas Eisner, a prospective full-time student living in Paris. Little did I know, I would be traveling to his city in June. He noticed a status update on Facebook and before you know it I was getting a personal tour of the city. The walking tour was a perfect way to spend the off day.

On the morning of the eighth we hopped backed on the Paris subway and headed toward the La Defense area to attend our first meeting at JCDecaux. The advertising firm pulled out all the stops, treating us to a presentation in their rotating presentation hall delivered by their Director of Marketing Strategy. Ms. Mari detailed the entire Cyclocity project and the unique challenges presented by the Paris project and the development of Velib.

Our second meeting took us to Business Objects, a unique firm developed with both French and American characteristics and employees. We spoke with Timo Elliot and Michael Thompson, both ex-patriates who told us about their firm, the merger, and their life in France. They presented one curve designed to display the satisfaction of ex-pats over time--which included one deep trough of dissatisfaction. Timo and Michael shared their personal experiences and emphasized the importance of assimilation and maintaining strong personal relationships during the process. As a person interested in work abroad, this part of the presentation was especially interesting.

Invest in France hosted our group for the final meeting of the day and was forced to improvise. The Managing Director was only able to speak with us for a few minutes before departing but the agency found two other speakers to take our questions. We discussed France's unique requirements for greenfield investment and their interest in building local employment. After our final meeting we enjoyed a typically French dinner--lasting over four hours and including more courses than I am able to count. All in all, a good day.

The Internship Search: A Three Part Saga: Part Three: Bending the Bat

[Originally posted on bumbastudents.blogspot.com for BU MBA Admissions]

Part Three: Bending the Bat

"Good Intentions" and "Tunnel Vision", compared to the title of part three, might seem like very straightforward headings. Forgive the analogy but my first love in sports was St. Louis Cardinals baseball and as I wrote the first entry in this saga I had this image on my mind:

The picture is of prospect Brett Wallace taking batting practice--one I originally found on the St. Louis Post-Dispatch website (here for the full article). As the photographer and columnist explained, bending a bat requires extraordinary strength and hand speed, so much in fact that the lifelong photojournalist has only caught two other players capable of the feat: Albert Pujols and Scott Rolen.

And what, exactly, does this have to do with the MBA internship search?

Everything.

The sprint to the finish in the search process requires every ounce of energy and demands perseverance and creativity. As a result, my classmates and I used every available career resource and even created a few of our own.

Create Your Own Solutions

It is my personal opinion that you cannot create your own opportunities--but I do believe that you can create your own solutions. These solutions are extremely important in taking advantage of opportunities and closing the search successfully.

Business Schooled

The first example of a student-created solution was the result of a conversation between candidates during a sports marketing conference in Washington D.C. Jason Serino and I headed to D.C. to learn more about the industry and left with a greater understanding, renewed energy and a new solution. At this conference and many events before it, every professional discussed the importance of passion for and knowledge of a specific industry. Jason, an ESPN alum, loves the sports industry and I love the video game industry...now what?

Authenticity

The one major problem with industry passion is authenticity. Every employer must question how passionate you really are about marketing ultrasound machines or creating new financial tools for insurance. Realizing we needed a new vehicle to demonstrate our sincere interest, we created it. Business Schooled was created as a blog forum and platform for students to demonstrate their industry passion and knowledge in any industry. The site relies on each student to post strong content (in their career self-interest) in order to build a site that improves with every post. In three short months, Business Schooled has expanded to host over twenty contributors from five different graduate business schools (with more soon to come). For more information on our sister blog, or to learn more about Playstation 3 pricing, the expansion of the MLS, or advances in personalized medicine, check out Business Schooled here.

The Changebase

Ashley Parsons Jablow, another MBA candidate at Boston University, also created a site to facilitate her career exploration. The Changebase is focused on all aspects of social entrepreneurship with the goal to "engage young leaders in a discussion of what change looks like in communities around the world." This site is another example of MBA candidates creating their own solutions and preparing for new career opportunities. For more information on The Changebase, follow this link.

At Long Last

At this point in my search, the semester began to wind down and I had done everything I could think of to bend the bat--I had more informational interviews than I could count, I had submitted innumerable applications, and I created Business Schooled. On April 24, the opportunity email arrived:

"Thank you for submitting your resume to apply for the brand summer internship here at Ubisoft. We think you could be great fit for this program. I'd like to schedule a time for you to do a brief phone interview next week. Please let me know your availability next week and I will coordinate a time for the call."

That email changed my whole perspective--I was instantly excited and failed in every attempt not to tell friends. I jumped into researching the company, its list of published titles, financial health, and future projects. I keyword searched "Ubisoft" on every industry site and read every article I could find.

The Interviews

The interview process took about two weeks and involved phone sessions with a brand manager, senior brand manager and their supervisor. The first began with the very traditional "walk me through your resume" and quickly became comfortable and conversational. My research and passion for the industry came through and even diverged into a debate on the merits of NHL '94 (introduction of one-timers) versus NHL '95 (faster gameplay). The second interview followed a similar pattern and also allowed me to discuss Business Schooled, a few of the articles I had written, and the purpose of its creation. The final interview skipped the resume walkthrough and jumped immediately into industry discussion and career questions. One important question asked, in so many words: do you see this as a summer experience or as a possible career opportunity?

The question is simple enough but also serves as a reminder to be prepared for the short-term/long-term question. Luckily, this internship is in the exact function and exact industry I targeted. It also helps that Ubisoft is a 5,000+ employee firm with strong financials and multinational operations. My answer, in short, was that I hope to secure this position, prove myself, and transition into a career opportunity.

The Search Concludes

On Friday May 8 I enjoyed a wrap-up party for the Graduate Admissions Office staff and headed to a Cohort C party to meet up with friends and watch the Celtics game. Sometime during the first half I received a call from an unfamiliar area code, and answered with my generic "this is Tyler." The call was from my interviewer and he was offering me the job! I laughed, apologized for the bar noise, and stepped outside to accept and take the rest of the call. As many of my peers experienced before and after me, I felt relief, excitement, and the weight of many months falling off my shoulders.

Advice to Incoming Candidates: Don't Start from Scratch!

In all three parts of this search saga I have mentioned the classmates, advisers, and friends that helped along the way. My advice to incoming candidates: don't start from scratch. The second years have all gone through this process in their own unique way and most would be happy to help as you follow behind them. Pick our brains, send us an email, invite us for coffee--find someone that interned in your area of interest and learn everything you can from them.

I would choose to pass along a simple message--every candidate will enter the program with good intentions, will focus and achieve tunnel vision, and will bend the bat to create their own solutions--how you go through this process is entirely up to you. For those preparing for next year's search, good luck, best wishes, and please grab me anytime in case this three part epic hasn't given a complete rundown of my personal experience.

I will now get back to my "research"--also known as playing No More Heroes and Super Smash Brothers Brawl--life is tough.

The Internship Search: A Three Part Saga: Part Two: Tunnel Vision

[Originally posted on bumbastudents.blogspot.com for BU MBA Admissions]

Part Two: Tunnel Vision

The first semester of any intense business school program flies by--leaving students to wonder how Thanksgiving has suddenly arrived. Blink once more and it's New Years Day. The holiday break was very well timed--heading home to St. Louis provided an overdue opportunity to spend time with friends and family and catch up on local sports. Returning to a snowy Boston, however, was a reminder that the internship search was about to intensify.

No More Darts

I returned to Boston about one week before class restarted (I highly recommend the downtime) and kicked off the semester by making an appointment with my career advisor Diane Riemer. After briefly catching up, Diane began to quiz me on my networking efforts (or lack thereof) and outstanding applications (or abundance thereof). We talked through the lists and I quickly began to realize that as much as I wanted a strong internship, I didn't really want any of the jobs for which I had applied. As I discussed in "Good Intentions" (is there such a things as aft-shadowing??), my only first semester search activities were a few networking fairs and online internship postings through our career center. The online postings are valuable but the functional areas and industries cover too broad a spectrum for any candidate to use them as the sole resource.

Diane then asked a very simple question--one to which I did not have an answer--what industry do you want to work in? I pride myself on thinking on my feet quickly but in this instance I really didn't have an answer. I knew from day one I was interested in marketing and specifically brand/product management but I had never given the specific industry a great deal of thought. I then remembered one of the online internship posts: Electronic Arts.

Tunnel Vision

When Diane and I began to talk about the gaming industry, I knew that something had clicked. Here I am, sitting with my MBA career advisor, talking about the game companies I grew up with, and I'm loving every minute of it. Games had always been a hobby and a passion but I had not ever seen the industry as a possible career path. The EA internship and my advisor had altered my perspective entirely. Leaving this meeting, I was determined to focus on the industry, learn as much as possible, and employ new-found tunnel vision.

I could wax nostalgic about my favorite EA Games for hours but instead I'll grab something from my Facebook page: "NHL '95 is a metaphor for my life." I grew up watching my older brothers Adam and Nick playing Mario 3 and Final Fantasy when I was still too young to understand exactly what was happening. NHL '95 was one of the first games I could challenge them in and also one of the first I would play regularly against friends. As soon as I wrapped my head around the idea of working in the gaming industry, I knew that I needed to search for every available opportunity. As February began I applied to online posts at EA, Activision and dozens of others. I also began to aggressively lobby contacts for informational interviews--which offered another turning point in the search.

Informational Interviews

First semester candidates at BU are required to complete at least two informational interviews--a requirement I met by interviewing my girlfriend's career advisor and a first-year classmate. Both were interesting and successful individuals but neither was involved in an industry that intrigued me. With my newly-found focus on gaming, I lobbied our career center for as many contacts as they could provide. This "get what you ask for" scenario led to an Excel spreadsheet with about 400 contacts.

I began emailing them immediately and learned an important lesson: if you are a student and you do not ask for an internship in the email, almost anyone will talk to you. The strength of our Corporate Relations team's contacts and the openness of these individuals allowed me to talk to the following individuals and more:

VP of Licensing at Atari

CEO of Skill Technologies

Senior Brand Manager at Capcom

VP of Marketing at TransGaming

Marketing Manager at FEARnet

These conversations and other were absolutely essential in helping me to understand the gaming industry and the skills/traits most valued in applicants. None of these phone conversations led directly to an interview but each helped me to refine my story as an MBA interested in marketing roles in the gaming industry. I prepared for each call extensively which allowed them to be less formal and much more conversational. For example, anyone calling a marketing manager at Capcom needs to know about recent events with Resident Evil, Mega Man, and Street Fighter. Making sure this marketing manager knows you've played through Resident Evil 4 three times also doesn't hurt.

Learn to Love the Search

The old adage "do something you love and you'll never work a day in your life" is, in my opinion, overused, but it was incredibly true for my internship search. As soon as I focused on something I truly enjoyed, the informational interviews, applications and cover letters became less of a burden and more of an opportunity. My original good intentions and new-found tunnel vision were each crucial for the sprint to the finish line, also known as Part Three: Bending the Bat.

The Internship Search: A Three Part Saga: Part One: Good Intentions

[Originally posted on bumbastudents.blogspot.com for BU MBA Admissions]

A Saga in Three Parts

As many of you have no doubt heard, the internship and job search has been extremely challenging this year for MBA candidates and graduates. Consequently, the process of finding an internship has been extremely difficult and, at times, nerve-wracking. To give a full picture of this process, I have decided to break it apart into three pieces titled, Part One: Good Intentions, Part Two: Tunnel Vision, and Part Three: Bending the Bat.

Part One: Good Intentions

Every job/internship search starts with an understanding of your own background and strengths. Before arriving at BU, the career center sent their first email asking for an updated resume in their format. This task was the first of many that would force me to sell my experiences in the most effective way. As one of the youngest candidates in my incoming class, this process would be absolutely critical.

Looking back, the process went something like this:

Entrepreneurial experience? Check.

Solid internships? Check.

Good GPA? Check.

Above-average work experience? Not so much.

Self-awareness is crucial in MBA candidates--we must identify our weaknesses early and compensate for them in every possible way. Incoming candidates, especially those young enough to appreciate the recent DVD release of X-Men: The Animated Series, must also have some idea of their future career options.

Early in orientation, I remember our Dean of Admissions, Hayden Estrada, asking a series of questions to the gathered incoming class:

How many of you wrote in your essays that you knew what you wanted to do after graduation? (Everyone raises their hand).

And how many of you, in reality, know exactly what you want to do? (Half of the hands fall--followed by a few embarrassed laughs).

At that exact moment I felt both relieved and apprehensive.

Good Intentions

Those essays, and those hands that remained raised, were all indicators of our good intentions. After all, I didn't lie in my entrance essays--I simply did not have a full picture of the options available to me--or those that were not. I wrote extensively on my ambitions to do international marketing consulting and to start my career abroad with an American-based firm. I knew I was interested in this function but I did not have a specific industry selected. As I came to learn during the search, a candidate must isolate functions and industries in order to truly focus and achieve the desired "Tunnel Vision" (everyone loves foreshadowing).

The fall semester had plenty of distractions from the search--everything from cohort events to Cheers with Professors to another Big XII North title for the University of Missouri (my alma mater, GO TIGERS!). The first semester is intentionally challenging and the BU Integrated Project looms over unsuspecting newbie MBAs until its conclusion in early December. Academic and non-academic responsibilities consumed my attention and led to my first major search mistake: procrastination. Every MBA program begins with an intense semester and project--and BU is no different--but students must persevere and not lose sight of the internship search.

Relax...then Focus

My first piece of advice for new students beginning the search: relax. Relax in any way you enjoy--grab a drink with a classmate, head to our amazing FitRec, sit on a couch, see a movie, play a game (I suggest Resident Evil 4 on Wii)--do whatever you need to in order to escape and take a deep breath. Stepping away from academic and professional work for a moment allows you to remember why you came back to school, to realize how many new friends you've made, and to take a mental break.

Relaxed? Alright, time to focus. Pick a function, pick an industry, find a job. Part One has come to a close.

Amazon Gets Serious About Gaming

It should be news to none of our readers that Amazon has been a pioneer in evolving online retailing. What might be surprising is their proactive response to new methods of game distribution and extension into used game sales.

Most recently, Amazon has built relationships with Nintendo's WiiWare service and Microsoft's Xbox Live while also offering a casual game store and a used game service.

How recently you might ask? Amazon has unveiled these four separate initiatives in the last three months.

Amazon entered the traditional retail game space in 2006 and announced its first new change in February of 2009 with a casual PC game download service. Utilizing its massive scale, the service launched with 600 available titles and was a clear first effort for Amazon in the direct-download channel.

In early March the retailer unleashed an even more interesting initiative--a centralized used game program. In the past, Amazon had utilized its Marketplace to allow individual, smaller sellers to post and sell used games but the service was never fully coordinated by Amazon. The new system will offer Amazon store credit when users send in "good condition" used games which will then be sold by Amazon directly.

This move presents a potentially huge threat to used-game industry leader Gamestop and other smaller retailers. Although Gamestop abandoned their attempt at the mail-in used game business, Amazon aims to grab market share quickly by offering higher trade-in values and cheaper used prices. In addition, used games offer a substantially higher profit margin than new game sales--an industry characteristic that could substantially add to Amazon's bottom line. In my opinion, the success of this program must be measured according to net sales increase as simple cannibalization of new game sales will not achieve substantial revenue growth.

What came next for Amazon? In April the retailer hit consumers with a two-punch combo of Xbox Live and WiiWare downloads. These moves offer digital downloads for the Wii and Xbox 360 which presents an interesting departure from the traditional closed market for console downloads. The services add no exclusive content but contribute to a fully developed retail destination for gamers. With the exception of the Playstation 3 download market, Amazon has now built a retail hub that includes new and used game physical purchases alongside digital downloads.

Amazon achieved success in other media formats by offering a complete set of purchase options and, after a busy three months, they have built a similarly comprehensive retail source for gamers.
 

Playstation 3 Pricing Models: Has Versioning Gone Too Far?

Rumors Abound

"As we have stated previously, we do not have plans for a PS3 price drop, and any rumors to that effect are false and are the result of speculation."
--Al De Leon, Public Relations, Sony Computer Entertainment America

(Sigh.) With this announcement, gamers across the world let out one synchronized breath of disappointment. For the last several weeks buzz built all over the internets (it's a series of tubes) regarding the possibility of a PS3 price drop announcement. On May 31, De Leon's comment quelled the rumor and insinuated an entirely different Playstation announcement for April 1.






Launch Pricing and SKU Proliferation

The Playstation 3 launched in the United States on November 17, 2006 with two SKUs (stock keeping units): a 20GB model for $499 and a 60GB model with premium features for $599. At first, this appeared to an intelligent use of the versioning pricing model in order to maximize early adopter revenue.

Following a tepid reception from critics and consumers, Sony began to introduce a series of new product SKUs designed to take advantage of manufacturing improvements and to increase sales. These packages, differentiated in features and hard drive capacity, included:

• Launch (Nov. 2006): 20GB
• Launch (Nov. 2006): 60GB
• Aug. 2007: 80GB (version 1)
• Nov. 2007: 40GB
• Aug. 2008: 80GB (version 2)
• Nov. 2008: 160GB

Needless to say, the PS3 versioning environment is confusing and crowded. Only the 2008 models are still in production, priced at $399 and $499 respectively. Even after this post-launch discount, the PS3 is still priced far above its competitors with the Wii holding steady at $249 and a new Xbox 360 "Arcade" at only $199. Sony must quickly decide if it can sacrifice market share in the interest of profit margins--or if other factors may allow them to achieve both.

Diminishing Operating Losses

Manufacturing costs have been a major factor in Sony's inability to remain price competitive relative to its console gaming rivals. Next-genbiz.com released a November 2006 estimate that Sony's production costs stood at an amazingly high $805 for its 20GB unit and $840 for its 60GB unit. Many console manufacturers had historically implemented a loss leader strategy--recovering high operating costs with strong licensing fees--but none had ever gambled as boldly as Sony with the PS3. The graphics processor and Blu-ray drive (two major points of differentiation) were the primary source of high costs.

Starting as early as 2007, several reports surfaced suggesting lowering costs, culminating in a Sony announcement that the gaming division had regained profitability in Q3 2008. These announcements were a major factor in fueling the rumors surrounding a PS3 price drop coming into 2009.

The PS2 Panacea

The Playstation 2, by any account, is a massive commercial success. The resilient console continues to sell tens of thousands of units in the United States and Japan and has one of the largest game libraries in industry history. Looking to reposition the PS2 in its waning days, Sony announced on April 1, 2009 a price drop to only $99. This budget-friendly pricing scheme will maintain sales of the low-cost, high-margin unit which may be subsidizing the low-margin PS3 business.

The Future

Sony has to make a decision:

• Maintain margin and hope for further cost decreases
• or
• Cut the PS3 price in August to generate buzz and sales for the 2009 holiday season

In my opinion, Sony cannot give Microsoft and Nintendo another holiday season to gobble up the remaining next-generation console market share and must act swiftly. An August 2009 price cut would present consumers with a very attractive value proposition. Now is when we must all stop to remember that the PS3 is not just a gaming console--it is a fully capable multimedia machine with top-notch graphics and the high-definition Blu-ray disc drive. Once the PS2 has run its last race, Sony could also add backwards-compatibility back into the PS3, further increasing the value of the console and opening up new Sony customers to a critically-acclaimed back-catalog. At a marginally lower price and enhanced functionality, Sony could overtake Microsoft for dominance in the high-performance console wars.

Pitchmen: Behind the Booming Infomercial Business

Titles also considered for this post:

• Read one article....and we'll throw in another for free! (only pay processing)
• This articles contains over 100 words!
• This blog can make you a better job candidate in just 30 minutes a day!

All kidding aside, the infomercial business is booming--and the Discovery Channel has noticed. As a result, a new series, "Pitchmen", will debut on Wednesday night to give viewers a behind-the-scenes look at the famous personalities behind the TV products. Sales is rarely a part of the business school or MBA curriculum but Vince Offer and Billy Mays could easily serve as adjunct professors.

Vince (ShamWow) and Billy (Oxiclean, Bedazzler, Mighty Putty) have achieved celebrity-like status thanks to their over-the-top energy and bizarre products. Their status has grown alongside the infomercial platform. Thanks to ever-expanding platforms and channels for advertising, infomercials have moved away from their traditional 4 A.M. time slots on attention-starved channels such as Bravo, the Outdoor Channel, or the Hallmark Channel.

New 90-second spots for the Snuggie (comes with free booklight) and the Awesome Auger (free power drill) now hold viewers' attention midday on ESPNNEWS and other mid-level cable networks. Cable and satellite TV networks seem to understand the long tail of demand---but forgot about its implications on advertising capacity utilization.

The industry, meanwhile, is laughing all the way to the bank. Starting with Orange Glo, OxiClean, and Kaboom, an incomplete Wikipedia article suggests Mays has marketed well over fifty products. Even without a recognizable pitchman, the Snuggie has now sold over four million units in less than one year. Infomercials have led the way but many more industries may soon make the shift to long-form advertisements thanks to greater availability and decreased price.

For a fun look at a few classics check out the videos above-and also the product competition mash-up video below:

The Razor and Blade Business Model in Gaming

The Model

Strange things happen when you start studying marketing in, say, 2003 and continue to toil in academia until, say, 2009. The entire world can soon be broken into a series of models, acronyms, buzzwords, and lingo (which is incidentally a really fun game show). Business school and the MBA experience has only kicked this into high gear and prompted the realization that video game console peripherals are a perfect example of the famous "razor and blade" business model. This model is based on any business that sells a relatively inexpensive host item (the razor) which requires additional, continually revenue-generating items (the blades).


I have isolated the following peripherals according to their success in proposing an innovative marketing message and their ability to deliver on this proposition. Some have been revolutionary while some have been unmitigated disasters. The peripheral industry now generates over $600 million and would never have been possible without these successes and failures.

The Worst

Robotic Operating Buddy (R.O.B.)

One of the original pack-in accessories, R.O.B. has been widely recognized as a "Trojan Horse" allowing Nintendo to capture consumers' imaginations and driving purchase of their first console, the Nintendo Entertainment System (NES). However, supported by only two games (Gyromite and Stack-Up), R.O.B. was a complete functional failure. This Buddy only moves its arms left to right, up and down, and can be completely neglected in favor of the much simpler NES controller. This example specifically illustrates the importance of message and delivery in tandem--and the failure that can result from either component's absence.



Power Glove
Many industry observers credit Nintendo and the NES with saving the video gaming industry from total collapse in the early 1980's--deservedly so--but I would propose that the Power Glove had nothing to do with its success. Nintendo again garnered a great deal of attention thanks to an early example of product placement in The Wizard (available on Laserdisc) but could not deliver on overextended promises. As with R.O.B., the peripheral was more frustrating than useful and users commonly resorted to removing the glove and using the buttons in regular controller configuration. Some suspect this set the stage for the Wiimote--which I sincerely doubt--but it was nevertheless a failure in its own time.


Sega Activator

The Sega Activator is a train-wreck. This peripheral was again ahead of its time in attempting to implement motion control--keyword: attempting. Sega failed to deliver a clear value added message for the consumer or for its game developers, who only delivered three supported titles: Eternal Champions, Mortal Kombat, and Comix Zone.

Each of these "worst" examples have issues in common: poor marketing communication and almost nonexistent business-to-business promotion. As evidenced by the following examples, proper development and delivery of peripherals can lead to greater revenues, stronger brand loyalty, and better developed barriers to competitive entry.

The Best

Rumble Pak

Successful peripherals drive long-term revenue in a variety of ways--a feat the Rumble Pak accomplished by differentiating the Nintendo 64 (N64) in a crowded, competitive console environment. Released in 1997, this bulky accessory allowed games to send force feedback through the N64 controller and add a new sensation to intense gameplay events. The concept was so well received that it became an industry standard in only one hardware generation.

The Guitar Hero Guitars

Originally developed by Red Octane, a specialty controller design company, Guitar Hero has become a phenomenon. Without any capability for a massive initial marketing push, Red Octane and developer partner Harmonix pulled consumers in with word-of-mouth and favorable publicity and reviews. Major retailers began to have trouble keeping the item in stock and Red Octane was soon acquired by gaming powerhouse Activision. Since its inception, the Guitar Hero franchise has generated well over $1.6 billion with Guitar Hero III: Legends of Rock setting a record as the first title to generate over $1 billion in sales.

Wii Balance Board

The Wii Balance Board is an example of Nintendo's continued dominance of the modern console generation. This non-gaming peripheral is included as a pack-in with Wii Fit, a fitness "game" that includes exercise routines for aerobics, yoga, strength training, and cardiovascular health. Nintendo has also communicated its value to game developers which resulted in Wii Ski and the hilarious Rayman Raving Rabbids TV Party in which one game can be played while sitting on the Balance Board. The Wii Fit-Balance Board package also retails for a cash-cow $90 and has generated over $1 billion with over 2 million in unit sales. This package has also defied the industry sales model in that its sales have accelerated since its release.

The Wrap-up

Nintendo and Sega have been on both sides of the peripheral gamble and have experienced successes and failures in balance. Sega no longer competes in the console-accessory (see: razor-blade) market and has left the mantle to Nintendo. The Wii has been a runaway success but has also had its own questionable peripherals (see: Wii Zapper). The Balance Board is an incredible example of using accessories to generate demand in entirely untapped consumer segments while expanding the total consumer base.

Third party manufacturers now also see increasing value and have begun to create innovative solutions such as the Nerf-N-Strike blaster, a traditional Nerf gun that can also hold a Wiimote and comes packaged with a simple video game. The future for Nintendo and its partners is in radical peripheral innovation. In order to achieve the highest level of success and adoption, Nintendo, Sony, and Microsoft must develop new peripheral experiences and effectively communicate the value of these new tools.
 

Mascots, Avatars, and Escapism

You and Mii

Modern gaming systems have brought new innovation in graphics, game physics, downloadable content, and most interestingly, avatars. Microsoft, Sony, and Nintendo each have different names for their virtual representations but each suggests a major shift in industry strategy. This contrast becomes instantly obvious when comparing the transition from industry-produced mascots to user-created avatars.

As an MBA candidate, I often lose myself in a sea of the latest business school trends. Only a return to a world before "synergy", "web 2.0", or "value-added" can remind me of the true power of the theory behind the lingo. I would suggest that mascots were the original avatars and that they were the first marketing tools used to develop social networks---long before "social networks" would win a game of buzzword bingo.

The Mascot as a Universal Avatar

Nintendo did not create the gaming industry but can be credited with saving it from near collapse in the early 1980's--all thanks to a plumber. This character, originally known as Jumpman, may be more widely known by his other name, Mario:


Mario became the definition of the everyman and evolved into a shared entertainment experience for millions. "Community", the holy grail of social marketing, is based on exactly that--a series of shared experiences. Mario, in his infinite simplicity, is a universal avatar. He is the virtual representation of very individual at home holding an original Nintendo Entertainment System controller.

Sega Gets Blue, Edgy

Just as Mario was getting comfortable with his third epic, Sega launched its own everyman. Sega had competed with Nintendo during the 8-Bit console wars but its Sega Master System achieved only marginal success in America. In order to catch up to the new industry giant, Sega achieved first-mover advantage with its 16-Bit Sega Genesis and included a pack-in game, Sonic the Hedgehog. Sonic was an advertiser's dream.




Compared to Mario, Sonic was faster, edgier, more colorful, and indisputably cooler by early 1990's taste. Sonic introduces the first characteristic of modern avatars: over-the-top escapism. Mario was universal in a way that Sonic was not. The shared experience--the avatar effect--was retained, however, thanks to phenomenal advertising and overall marketing strategy.

The Everyman's Friends

Both Mario and Sonic drove millions of units in game sales and each was soon given their own set of friends--Mario had his brother Luigi while Sonic had Tails. This again is an important transition in marketers' understanding of the importance of user identification with specific characters. Sonic's cast of friends seemed to stretch ad infinitum while Nintendo focused on developing Mario's cast with more depth. At some point, a gamer could guess a color and an animal and probably find a Sonic character to match their preference.

Mass Customization or "I Am the Everyman"

The newest generation consoles accelerated the devolution of the mascot and introduced mass customization to the industry. If mascots are drivers of shared universal experiences, modern mascots are individual customized experiences. Struggling to choose a character for tennis, bowling, racing? Choose yourself.

Marketing has crossed a line in the sand by ceding control of the experience to individuals (and enjoyed great commercial success) but has sacrificed escapism along the way. Universal characters are now background set pieces to the game engine in many cases and only serve as "legacy brands" driving sales.

Marketing a Modern Shared Experience

Now, after a long day at the business school cranking out spreadsheets or using my left hand to hold up my right for participation, I escape into a game of bowling only to watch my virtual self agonize over a 7-10 split. Would it be easier to watch Mario or Sonic fail? Perhaps, but in the meantime game developers and marketers must balance the attractiveness of avatars with the demonstrated value of universal experiences and escapism.

Sonic Game History

Mario Game History

ESPN Gets It Right: Fantasy Baseball 2009

Distributing a Fantasy

Fantasy sports present an interesting crossover industry that touches both gaming and modern sports management. For baseball specifically, gone is the era when avid fans could only read their local daily columnists and relied on annual magazines previewing the upcoming season. The explosive expansion of fantasy sports has created an entirely new distribution channel for major league branding including MLB, NHL, NBA, NFL, NASCAR et al.

Knowledge as a Tool for Buy-In

Professional sports brands now have more daily consumer touches than ever--an interaction that has dramatically increased consumer knowledge and buy-in. After all, how many individuals understood these terms before fantasy sports:

• WHIP
• +/-
• BABIP

Only a truly hardcore baseball fan, as late as the late 1990's, would understand batting-average-on-balls-in-play (BABIP) or walks-and-hits-per-inning-pitched (WHIP). Additionally, casual fans may struggle to understand offsides in hockey--much less a player's plus/minus rating (+/-). As with many other forms of entertainment, the new era of information availability has increased consumers' thirst for more breadth and depth of information.

The Fantasy Industry Evolves

Countless fantasy sport platform providers stepped into this space to provide detailed information and a platform on which to compete. Early players (ex: sandbox.com) faded and ESPN and Yahoo stepped up as major players in the industry. Until recently, however, no single platform succeeded in providing strength in both available editorial content and platform structure.

I began playing fantasy sports in 2002 with a baseball league on sandbox.com and quickly realized just how much I did not know about any team other than my beloved St. Louis Cardinals. I also learned that although the sandbox platform was very easy to use and play, it was not a good provider of fantasy sports editorial content. Yahoo carries on the spirit of this early platform but still lags behind in providing expert analysis and tips for fantasy gamers.

Conversely, ESPN always excelled in providing top-tier analysis but failed to deliver premium services without a premium price. ESPN used its draw and vast resources to bring in fantasy sports-specific writers that provided valuable analysis and commentary free of charge. Initial efforts to host gamers were solid but could not match the ease-of-use delivered by Yahoo.

Filling the Void

After seven years of hosting leagues on Yahoo and scouring the internets (it's a series of tubes) for better information I was more than frustrated. Or I was, until March 2009. ESPN launched an aggressive marketing campaign in early 2009 to promote its new free fantasy baseball premium offering. Offering free live scoring, active message boards, an extensive content library and daily video podcasts, ESPN took their service to a new level at a new price.

The first commercial might not have caught my attention but their persistent advertising motivated a second look and their presentation motivated a full-on switch. Willingness-to-pay (or at least willingness-to-play) in the fantasy gaming space is primarily motivated by price, features, and editorial content. ESPN's campaign effectively communicated each of these components and achieved its end goal in motivating a switch.

Niche Opportunities

ESPN, Yahoo, and other smaller players will continue to compete for market share and page views but a space remains for niche players. Companies can continue to fill the information gap by providing consolidated content services and innovative original writing. As big players continue to become more complex other firms will succeed in becoming more simple. One of my favorite support sites is http://www.goaliepost.com/. This site serves exactly one function: post for the benefit of fantasy hockey owners exactly who each team will play in goal on any given day. Extremely simple, effective, and valuable.

Bold prediction:

Cameron Maybin (Florida Marlins Outfielder) hits 20/20 (aka 20 Home Runs and 20 Stolen Bases).

Wii MotionPlus: Nintendo Changes the Game (Again)

Idea

On July 14, 2008, Nintendo announced a new Wii peripheral known as the "MotionPlus." This accessory builds upon the motion-sensing technology of the Wiimote and brings the remote close to 1:1 motion detection. Nintendo changed the industry with the original Wiimote and built tremendous buzz with the announcement of a device that would enhance this experience. Consumer anticipation of "real" home run derby, long-drive golf games, and swordfighting finally seemed within reach---but could Nintendo deliver?

Idea: A+

Strategy and Execution

For a few weeks in the summer 0f 2008, Nintendo had the full attention of their consumer base---and then they lost it. Press releases, official website posts, and a launch at E3 in 2008 garnered mass appeal but were followed with very few details. Even IGN, an excellent source for gaming news, had only rumors and speculation to report for months after the intial announcement. In addition, Nintendo released almost no information about the packaged-in game, Wii Sports Resort.

Total number of articles on nintendo.com on MotionPlus: 2
Most recent: July 15, 2008

Total ign.com articles found with a "MotionPlus" search: 31
Articles written since July 15, 2008: 29

Looking at numbers may seem like oversimplification but it presents a serious problem: lack of marketing message control. For almost nine months Nintendo has done nothing internally to control the message and positioning of MotionPlus. It is also now apparent, thanks to outside reporting, that Nintendo has actively sold its new technology to developers (ex: EA Sports) and is building industry interest in its application.

Instal base presents another problem:

Estimate Wii install base: 49,994,034
(Source: nexgenwars.com)

Exact MotionPlus install base: 0

Strategy and Execution: C+

Outlook

Nintendo has lost control of the MotionPlus message, has zero instal base, and refuses to set a hard launch date...and yet, I love the concept. As Nintendo proved with its DS handheld and Wii console, sometimes the idea can overcome major "traditional" business obstacles. The first time a Youtube video leaks with a consumer enjoying true-motion golf swings or getting slice on a tennis shot, the technology will explode. Futhermore, the runaway success of Wii Fit and the Wii Zapper demonstrate consumers' willingness to pay for peripherals that enhance the gameplay experience. A perfect prediction model involves the Wii Play combination pack which includes a game compilation and remote for $50--which has sold over 10 million units in just over 24 months.

Bold prediction: one year from this post, more than 50% of Wii owners will own at least one MotionPlus attachment.

Outlook: A+

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Greetings everyone!

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