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The Roundup September 28

Electric Hummer
Maybe the Chinese can build an environmentally friendly Hummer, a “bold chihuahua,” maybe . . .”

Even the Chinese hate Hummers

The Hummer brand, however, could be on the road to extinction if GM cannot soon finish a deal with China’s Sichuan Tengzhong Heavy Industrial Machinery, the only bidder for the controversial brand. . . .

The tentative plan is for GM to continue building Hummer vehicles through a transitional period. The length of the transition is one of the unresolved issues. Longer term, Hummer is hoping to replace its gas guzzlers with new models that use lighter-weight materials and advanced power trains, and maybe even hybrid vehicles. The plan is to continue building Hummers in the U.S., not in China where the prevailing wages, $12 to $25 per day, are significantly lower. . . .

However, there are signs that the Chinese government might have reservations about the deal, observers note. Among the sticking points, China’s National Development and Reform Commission has said publicly the purchase of Hummer is inconsistent with China’s effort to become greener.

(“Could Hummer Be Headed for the Heap?,” Time, September 28) Let’s look at this deal a bit more closely, beyond the normal M&A stuff and whether or not Hummers are a good thing. The Chinese are heavily invested in the American economy simply by virtue of their Treasury and dollar reserves. That investment will greatly increase as they start using their economic heft to own American companies and manufacturing. As this week’s excellent issue of The New Republic discusses, the Chinese are starting to get pushy about how Americans run their economy, demanding, for instance, that we reform our health care system (or the American economy will go broke, according to the Chinese), cut back on federal borrowing, and reform our financial sector. Now, I read the Chinese press diligently, and most if not all the conclusions in The New Republic piece are accurate. As the Chinese own more and more of American manufacturing and services, their managers . . . who are beholden to Chinese federal government functionaries . . . will start exerting the same kind of influence over our government functionaries that American managers do. Will Republicans be so unquestioningly pro-corporate when the corporate managers and their lobbyists who are influencing or writing legislation are closely tied to the government of China? Don’t get me wrong. I don’t go for conspiracies and I am all for the Chinese buying American companies and contributing to American employment. But corporate managers (not corporations, as liberals like to formulate the problem) have an outsized role in and unparalleled influence over American government. Maybe we ought to rethink this as more and more of American companies are run by managers who are, to some degree, at the beck and call of a foreign government. But the Chinese atavistically hate Hummers (called “bold horse,” or Hanma 悍马, in Chinese) right down the person on the street. So this deal ain’t going to fly. But what about the next deal?


Red Robin finally “gets” social media marketing. Do you?

Empathica asks Red Robin customers to fill out an online survey at the bottom of their restaurant receipt. In return for possible cash prizes, they answer questions about their experience, and finally, if they would recommend the chain to someone else. Those people are invited to recommend Red Robin to their Facebook profile page. . . .

Recommenders have an average of 150 friends, who all get positive impressions of the brand, at least in theory. Red Robin chief marketing officer Susan Lintonsmith estimates that her chain has gotten about 1,500 recommendations since Empathica launched the service in April. That would mean about 225,000 positive impressions during that time. The Red Robin fan page, meanwhile, has about 1,900 fans. . . .

“What we do is place the brand logo on wall posts and we include a short sentence, ‘So and so recommends this Red Robin, the street, city and state,’ and then the verbatim recommendation,” he said. “It looks very natural, it doesn’t look like marketing copy, but very sincere.” For example, Mr. Datars said, one consumer recommending another of his clients wrote simply “Eat out, Bitches!”

(“Red Robin Calls in a Facebook Favor From 1,500 Fans,” Advertising Age, September 28) What Red Robin “gets” is that social media marketing is about people’s activity rather than passivity. Almost all marketing, from media advertising to packaging, treats individuals as a passive sponge. However, the gospel that folks like Seth Godin have been preaching is that customers can and do actively market the products and brands they genuinely like and that social media gives entrepreneurs and brand managers a (limited) access to that activity. But how many of you out there are treating your Facebook or Twitter friends (or fans or followers or whatever) as if they’re merely names on an opt-in email list, or, in this case, an opt-in status update list? Social media is about getting people involved, not necessarily sold.

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