Starbucks?  Still up to its internet shenanigans. Starbucks, with it’s tech savvy street cred charges $3.99 for two hours, but with the rewards program you get two hours free.  Joy.  Is it me or does Starbucks charging for internet seem completely contrary to its brand image?  I think you’re more likely to see free internet at Chuck E Cheese’s before Starbucks.  Such a wasted opportunity.

This only brings me hope that one day we’ll see the end of the cable box.  Will online video content ever overtake cable and satellite?  Please, YES!  Right now, at least 70% of the TV I watch from networks is time-shifted.  About half of the total content I watch is streamed.  What is the point of the cable box?  Why not take control and serve ads?  The cable box should be strapped to a rocket and sent into space as far away from humans as possible.  My cable box is, by far, the biggest under performing electronic device I have (and I own a Blackberry Storm).  It’s junk.   It is only slightly better than a cinder block with wires coming out of it.  It takes 3 seconds to recognize input, if at all.  It often takes two or three tries to get the channel imputed correctly.  Sound drops in and out.  The picture often freezes.  It drives me crazy.

Despite having achieved mainstream status a few years ago, the total audience for online video continues to balloon. And YouTube’s dominance in the category seems boundless, as the site delivered more than 10 times as many video streams as any other site in the U.S. last month.

According to the latest report issued by Nielsen Online, 137.4 million Americans watched Web video in December, a healthy increase of 10.3 percent versus the same month in 2008. Those viewers streamed over 10.7 billion videos during the month, representing an increase of 11.8 percent versus the same time period a year earlier.

While the number of streams per visitor showed only marginal growth, Web video viewers are watching longer clips on average; time spent (per viewer watching online video) jumped 13.2 percent to 193.2 minutes in December.

http://www.seattlepi.com/business/404556_starbucks2.html

The LHC is going to come out with some amazing discoveries in the next few years.  They may prove dark matter, find one or several new atoms, and more.  It won’t be Americans doing it…it should have been.

The giant Large Hadron Collider, the world’s largest and most expensive scientific experiment, will be shut down for at least two months, scientists at the European Center for Nuclear Research, or CERN, in Geneva said Saturday.

New Particle Collider to Shut for Repairs – NYTimes.com

Also, you know a company is in trouble when loyal customers are leaving and it is spending to acquiring new ones.  Customer acquisition is much more expensive than customer retention.

Read the whole article if you are interested in Starbucks, it’s definitely  worth while.

Starbucks (SBUX) has lost its mojo. Customers are not coming back with the same frequency and new customers are proving harder to find. The world’s leading drug company unintentionally brought this on themselves when they forgot who they were.

Prevailing thoughts point to a high price being the main issue. In a down economy price plays into some of the problems. However, this is a symptom of the real problem, not the problem itself. Let me tell you how Starbucks lost its way.

I was a loyal Starbucks customer for 7 years. I wasn’t someone who went in for a special treat once in a while. Rather, I made the company a part of my morning routine on the way to work. Get up, brush your teeth, put on clothes, stop at Starbucks, goto work. I was their dream customer.

Over the years the lines started to get longer as the company struggled to make lattes fast enough to keep up with demand. I willingly waited, as I knew my drink would be made just for me. The Barista — the coffee expert behind the counter — would grind some espresso, pausing to press it, before pouring a perfectly timed shot. If the shot was too long – it would be bitter. In this case, the Barista, striving for the perfect shot, would remake it without customers even knowing. Milk would be freshly steamed to just the right temperature. Quality was everything. More than a coffee, Starbucks and I shared a morning connection. One day it all changed.

I’m sure it didn’t change overnight, but I failed to notice the small, telltale, signs leading up to heartbreak. At first, everything seemed normal. I walked in, the pleasant person at the front cash, recognizing me, called out my drink for the Barista on the bar. By the time I swiped my Visa my drink was waiting for me. Amused at this frighteningly quick process, I stuck around to watch the next person order. How did they do that so quickly?

Unfortunately, there was nobody in line. That didn’t seem to stop the Barista from steaming some milk. Curiously, I wondered for whom? Wait, is that a new espresso machine? Why does it look so high-tech? I waited. My answers would come as soon as the next customer came in.

After a few moments my wish was granted as customer fumbled for change while ordering a drink. Like a hawk my eyes focused on the Barista. He quickly pressed a button and the espresso machine automatically dispensed a shot of espresso.The Barista used preheated milk rather than heat milk for this individual drink after the customer ordered. The drink was awaiting the customer before he had finished finding enough change to pay for it. Gone were the hand-fresh grinds, perfect shots, and freshly steamed milk.

All of the sudden, the Starbucks experience felt different. My drink tasted different. The romance of my morning coffee was gone. Of course, chemically my drink had the same composition. (Often however the milk tasted burnt – a by-product of preheating milk that has to stay warm longer while it waits for a customer.)

If you remove the romance, Starbucks reverts to selling a simple, easily substitutable, commodity. After a few mornings of unromantic experiences, I wondered why I was forking out money for a latte that tasted so blah and I stopped going.

Where Starbucks Went Wrong – Seeking Alpha

SUMMARY: The challenges of search marketing multiply when you’re running campaigns for multiple brands or divisions all at the same time. You don’t want to compete against yourself for key terms or benefit one campaign at the expense of another.
Find out how a state travel agency that manages search campaigns for thousands of private sector partners coordinated efforts that boosted website traffic 142% and clickthroughs to partner sites by 1,770%. Features 5 strategies for organizing an SEO campaign around a main portal and handling PPC advertising partnerships.

George Zimmermann, VP, Travel Michigan, the Michigan Economic Development Corporation, and his team generate leads for 13,000 tourism and hospitality businesses by marketing the state as a destination.
For several years, Travel Michigan’s primary conversion channel has been a website – Michigan.org. It highlights the state’s attractions to potential visitors and provides links to hotels, restaurants, and other services.
“One of the challenges is — how do we get more prominent placement for the Michigan.org website?” says Zimmermann. “We’re the big pipe, so obviously our private sector partners want to get as much traffic from us as possible.”
Search marketing is a natural fit for his team, but the tactic presents two significant challenges: How can they drive traffic that benefits all the private sector partners on the site? How do they coordinate campaigns among those individual businesses so they don’t compete against themselves for popular search terms?
The travel sector is competitive enough. They don’t want efforts by one group of businesses offsetting campaigns by others.
The team developed strategies that any marketer who manages multiple search campaigns for a single organization can use. They combine SEO and pay-per-click campaigns that don’t compete with each other and lift all boats under the same umbrella. They also use market analysis to find the best search terms and have a campaign management process that prevents keyword overlap.

There is 1 billion dollars that online firms were banking on, but will not get.  That’s a big deal.  It should not be that way.

Hey out there, don’t kill your marketing in a head wind!  Companies don’t make money with great products and/or services.  They make money by selling great products and/or services. When looking at a budget it may be a knee jerk reaction to cut everywhere, but that is a mistake.  Always keep what works.

For the third time in the last 12 months, Web researcher eMarketer has scaled back its estimates for online advertising in 2008 due to an uncertain economy.
The firm, which produces its spending estimates in part by culling together various predictions from top researchers in the space, now predicts that online ad spending in the U.S. will reach $24.9 billion, down slightly from the $25.9 billion forecast issued last March. That March figure represent a slight downgrade in expectations itself, as eMarketer had original put spending expectations for 2008 at $27.5 billion last October.
Also, this past May, eMarketer reduced it’s spending estimates for social network advertising to $1.4 billion, down from an earlier projection of $1.6 billion.
The reason for the slightly reduced enthusiasm is likely attributable to the shaky U.S. economy, which has left evidence of it’s impact on previously red hot digital media segment in recent lackluster earnings announcements for companies such as AOL and ValueClick. Yet eMarketer maintains that 2008 will net out as a solid year for the medium, which should see ad revenue surge by 17.4 percent, an enviable growth rate by most media’s standards.
Still, the consecutive forecast downgrades mark a noteworthy change from recent years, when spending forecast upgrades were the norm and the industry enjoyed yearly growth ranging from 20 to 30 percent. It seems that even the most trackable and efficient medium is not immune to economic conditions. Earlier this year, according to the Internet Advertising Bureau and PricewaterhouseCoopers, online ad spending reached $5.8 billion, it’s second highest level ever—though that figure represented the end of a 13-quarter growth streak.
However, while online advertising may feel the impact of a potential recession, it continues to benefit from a more macro shift in consumer media usage and marketers’ spending habits. “Even as the potent mix of a misfiring economy and consumers’ changing media habits shave advertising dollars from traditional venues, such as newspapers and television, Internet ad spending will continue to grow rapidly,” said eMarketer. senior analyst David Hallerman.

eMarketer Downgrades Online Ad Spending Forecast

I was a huge Starbucks junkie during the golden years.  The years before the Pikes Roast and the push button espresso machines.  When Starbucks’ employees took pride in their jobs. Perhaps I’ll write a country music song about how I yearn for those days.  Until than, I’m brewing at home.

Starbucks coffee shops seem to be on nearly corner in major U.S. cities, but surprisingly 76 percent of American adults say they rarely or never visit one of the shops, and only 14 percent say they visit occasionally.

That might be because the java giant’s prices are too high.

A new survey by Rasmussen Reports shows that 73 percent of Americans say  Starbucks coffee is overpriced. Only 6 percent disagreed and 21 percent said they were unsure.

The latest national telephone survey conducted Aug. 8-9 by the independent firm specializing in public opinion polling information comes shortly after the Seattle-based company announced it was closing 600 stores nationwide, including 27 in Minnesota, and another 61 stores in Australia.

Along with the perception of high prices, only 38 percent of the 1,000 adults polled gave the coffee behemoth a favorable rating, while 27 percent had an unfavorable view of the chain. About one-third of respondents had no opinion.

Younger adults have a more favorable view of Starbucks than older adults. Just under 50 percent of respondents 18 to 29 give the chain high marks, while only 28 percent of seniors shared that view. And those who make more than $100,000 a year view the chain more favorably than those who make less than $20,000 a year, the survey said.

Not surprisingly, the main reason people go to Starbucks is for coffee, with 80 percent saying that was their prime reason for visiting. Five percent of respondents said they go for the food, 6 percent go to use the Internet and 8 percent listed “some other purpose.”

And though coffeehouses are viewed as places to socialize and hang out, two-thirds of Starbuck’s visitors say they get their joe and go. Only 20 percent say they stay around to socialize or use free wireless internet offered in most stores, the survey said.

The survey  released Monday has a margin of error of 3 percent.

Starbucks coffee is too expensive, new survey says

How slow?

Average DL speeds

US              : 2.3 Mb/s 

Japan          : 63 Mb/s

South Korea : 49.5 Mb/s

Finland        : 21.7 Mb/s

France        : 17.6 Mb/s

Canada       : 7.3 Mb/s

Slower than France?  Humph!  The shame is unbearable!      

Chicago (IL) – U.S. broadband speeds are the focus of a recently conducted study by Communications Workers of America (CWA) union and the results are not especially flattering for broadband service providers on these shores. The U.S. comes in 15th on a worldwide scale, far behind the leaders Japan, South Korea and Finland.

The CWA published the results of its first Speed Matters report in an attempt to get Congress to come up with an improved telecommunications policy. CWA claims that it represents more than 700,000 people in the telecommunications, media, public sector, manufacturing, health care and airline industries. The results of its study are based so-called last-mile connection data of 229,494 U.S. users who took the online speed test between May 2007 and May 2008. The connection speed was determined by sending a request from participant’s computer to CWA’s nearest server to record the time it takes to receive a response. The results have to be taken with a grain of salt, but still provide a good indication of nation’s state of the broadband infrastructure. That said, the results are staggering.
According to the CWA report (PDF download), the U.S. have not made significant improvements in deploying high-speed broadband networks in the past year. Most participants had DSL or cable modem connections, with 15% of the US population still using a dial-up connection. The median download speed in the country is 2.3 Mb/s, up 0.4 Mb/s over the past year. In terms of broadband penetration, the United States trail other industrial nations, ranking 15th in terms of the percentage of residents who access to a broadband Internet connection.
“This isn’t about how fast someone can download a full-length movie,” said CWA president Larry Cohen. “Speed matters to our economy and our ability to remain competitive in a global marketplace. Rural development, telemedicine, and distance learning all rely on truly high-speed, universal networks.”
Reality check #1: U.S. vs. the rest of the world

You may remember AT&T’s broadband commercial that compare the system’s performance to a supercar. Or Comcast’s current speedracer vs. turtle commercials. These commercials, of course only work in the U.S., if we consider the download speeds generally available on these shores.
A file that takes four minutes to download in South Korea would take nearly an hour and a half to download in the U.S. using the average bandwidth. Japanese users leaves U.S. users behind with an eye-popping 63.60 Mb/s download link. This means that Japanese can download an entire movie in just two minutes, as opposed to two hours or more here in the U.S. Just in case you are wondering: No, Japanese users do not pay more for their broadband connections. In fact, U.S. broadband cost is among the highest in the world.
Japan dominates international broadband speed with a median download speed of approximately 63 MB/s, more than enough to stream DVD-quality video with surround audio in real time. Next on the list is South Korea where download speeds achieve an average of 49.50 Mb/s. Finland and France follow with 21.70 Mb/s and 17.60 Mb/s, respectively. Canada ranked eighth with an average download speed of 7.60 Mb/s. The U.S. came in 15th with 2.35 Mb/s.
Reality check #2: U.S. states vs. U.S. states

The study results show that U.S. download speeds vary across the nation. Rhode Island is the place to be if you want fast downloads – the average download link came in at 6.8 Mb/s. If you live in Alaska, your speed is 0.8 Mb/s. For comparison, a 25 MB file takes 30 seconds to download in Rhode Island, but four minutes if you connect in Alaska.
States with a significant rural population tend to have the slowest speed, such as Wyoming, Idaho, Montana and North Dakota. Interestingly enough, a total of 24 U.S. states dropped in the ranking  compared to the last year – Alabama, Arizona, Arkansas, Georgia, Hawaii, Idaho, Illinois, Indiana, Kansas, Kentucky, Louisiana, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Hampshire, New Mexico, New York, North Dakota, Oklahoma, Oregon, and Vermont. Users in these states experienced slower average download speeds this year than in 2007.
We have been writing for quite a while about the problem of stagnating download speeds of U.S. broadband services and the potential problems that are developing out of this scenario. While providers such as Time Warner Cable, AT&T or Comcast are trying to squeeze more customers in their antiquated networks and are more focused on topics such as speed throttling rather than improving their infrastructure, other nations are slowly but surely running away with greater bandwidths that are likely to enable new services and new business opportunities.

TG Daily – Surprise, surprise: U.S. broadband is slow. Really slow.