Filed under: Television, Marketing and advertising, News Corp’B’ (NWS)

About every 10 seconds or so this season, “American Idol” host Ryan Seacrest or one of the judges brags about how this group of contestants is the most talented in the show’s history. They speak about the huge number of votes being cast and the huge number of song downloads sold on iTunes. Well, as the Associated Press points out, the American people would beg to differ.

“The 21.8 million people who watched last Tuesday’s competition was the show’s smallest Tuesday audience in more than five years,” the AP said. “The show did better the next night, with 22.9 million, but that was the smallest Wednesday audience in three years, according to Nielsen Media Research.”

But Idol fans and shareholders of News Corp. (NYSE: NWS) should not get too down since the show can be saved if producers follow my advice:

1. Fire Paula Abdul - Most of the time she makes no sense which has lead some people to wonder there is more than just Coca-Cola in that red cup in front of her. Perhaps Sharon Osbourne is available. She would make an excellent foil to Simon Cowell.
2. A new catch phrase for Randy Jackson – That “dog” does not hunt any more. The show should hold a contest to develop a new phrase for him to keep repeating.
3. Get Simon Cowell a wardrobe — Is he too cool to care about how he dresses or too cheap to buy nice clothes?
4. Seacrest out – Whatever pact he’s made with Satan has bound to have expired. Why does he need Idol anymore when he’s on every other television show?
5. The sound system – Am I crazy or does the sound on some songs seem much clearer than others?
6. The results show — Producers stretch out 10 minutes of content into a 30-minute show. Either make this program interesting or merge the two shows together.
7. The musical numbers — Why must viewers be tortured by the Idols butchering a pop music classic set to an arrangement that makes them look less hip than cruise ship entertainers? This should be axed.
8. Phone calls -- The idiotic questions from idiotic viewers grind the show to a halt
9. Transparency — It would be nice to know the vote totals for each performer
10. Contestants — Producers used to be good at finding interesting people who can sing. What happened?

Though the viewership is still large, the show has gotten as stale as day-old bread. The final contestants are a mediocre lot at best. David Cook has got rock star hair but has copied many of his memorable song arrangements from others. David Archuletta always looks like he is about to cry as he sings one song just like the other. Syesha Mercado has a pretty voice but she seems more suited to the Broadway stage than the pop charts.

Week after week, voters ditched the talented contestants such as Carly Smithson, and Amanda Overmyer and the ones that showed flashes of promise like Michael Johns. Instead, they let the likes of Jason Castro and Kristy Lee Cook make it to the top 10.

If Americans can’t get this right, how are we going to ever elect a president?

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Filed under: TV, Marketing and advertising, News Corp’B’ (NWS)

About each 10 seconds or so this season, “American Idol” host Ryan Seacrest or one of the judges brags about how this group of contestants is the most talented in the show’s history. They speak about the huge number of votes being cast and the big number of song downloads sold on iTunes. Well, as the Associated Press points out, the American people would beg to differ.

“The 21.8 million people who watched last Tuesday’s competition was the show’s smallest Tuesday audience in more than five years,” the AP stated. “The show did better the next night, with 22.9 million, but that was the smallest Wednesday audience in three years, according to Nielsen Media Research.”

But Idol fans and shareholders of News Corp. (NYSE: NWS) should not get too down since the show can be saved if producers follow my advice:

1. Fire Paula Abdul - Most of the time she makes no sense which has lead some people to wonder there’s more than just Coca-Cola in that red cup in front of her. Perhaps Sharon Osbourne is available. She would make an excellent foil to Simon Cowell.
2. A new catch phrase for Randy Jackson – That “dog” does not hunt any more. The show should hold a contest to develop a new phrase for him to keep repeating.
3. Get Simon Cowell a wardrobe — Is he too cool to enjoy how he dresses or too cheap to purchase nice clothes?
4. Seacrest out – Whatever pact he’s made with Satan has bound to have expired. Why does he need Idol anymore when he’s on every other television show?
5. The sound system – Am I crazy or does the sound on some songs seem much clearer than others?
6. The results show — Producers stretch out 10 minutes of content into a 30-minute show. Either make this program interesting or merge the two shows together.
7. The musical numbers — Why must viewers be tortured by the Idols butchering a pop music classic set to an arrangement that makes them look less hip than cruise ship entertainers? This should be axed.
8. Phone calls -- The idiotic questions from idiotic viewers grind the show to a halt
9. Transparency — It would be nice to know the vote totals for each performer
10. Contestants — Producers used to be good at finding interesting people who can sing. What happened?

Though the viewership is still huge, the show has gotten as stale as day-old bread. The final contestants are a mediocre lot at ideal. David Cook has got rock star hair but has copied many of his memorable song arrangements from others. David Archuletta always looks like he is about to cry as he sings one song just like the other. Syesha Mercado has a pretty voice but she seems more suited to the Broadway stage than the pop charts.

Week after week, voters ditched the talented contestants such as Carly Smithson, and Amanda Overmyer and the ones that showed flashes of promise like Michael Johns. Instead, they let the likes of Jason Castro and Kristy Lee Cook make it to the top 10.

If Americans can’t get this right, how are we going to ever elect a president?

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Filed under: General Electric (GE), Marketing and advertising

General Electric Co. (NYSE: GE)’s NBC Universal unit will charge $3 million per 30-second advertising spot in the 2009 Super Bowl, according to the Wall Street Journal (subscription required). Is it me, or does that strike anyone as particularly insane? The deal is this: I would be that many disinterested fans watch the Super Bowl just for the ads alone. The reason? These are the ideal of the ideal, attention-grabbing and inventive commercials.

So, why don’t ad agencies and PR flacks do this the rest of the year? The only Super Bowl ad that stuck in my mind this year was Tide’s ‘talking stain” ad, which probably cost a few dollars to produce and was enormously effective. The cost of the campaign was the cost of the ad, of course. All those other advertisers that spend millions on Super Bowl ads this year? Can’t remember one of them.

The price for a 2008 Super Bowl 30-second ad spot was $2.7 million, so NBC is upping the game here a bit. Is that ad inventory worth it? With media changing all the time, TV is still a lucrative game, and smart advertisers are combining the internet and television into complementary market platforms. Like the Tide commercial referenced above, the entire ad was designed to drive traffic to MyTalkingStain.com, not to your local supermarket to buy the product. That’s smart marketing. If you spent $3 million for an ad, would you want the impact of the web to somehow be involved? I thought so — but not all ads do, apparently.

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Filed under: Earnings reports, Deals, Marketing and advertising, Clear Channel Commun (CCU), Economic data

Shares of radio broadcaster Clear Channel Communications Inc. (NYSE: CCU) were slightly up in early trading after the company posted higher first-quarter profit boosted in part by gains in its outdoor advertising unit. Though, the company wasn’t able to beat analysts’ predictions as the weak economy put pressure on the overall advertising market.

Clear Channel Communications announced that its quarterly profit surged to $799.7 million, or $1.61 per share. The income figures were definitely something to cheer about. During its first quarter last year, the company had net income of $102.2 million or 21 cents per share. Excluding one-time items, earnings for the quarter would have been $0.19 per share. Analysts’ forecast (which typically exclude one-time items) was for $0.21 per share, according to Thomson Reuters.

The media and advertising display company also said that quarterly revenue rose 3.9% to $1.56 billion, compared with $1.51 billion reported in the same period a year ago, helped by favorable foreign exchange rates; excluding the effect of the week dollar, revenue rose only 1%. Analysts had been expecting to see slower sales of $1.53 billion.

Clear Channel is currently in the process of trying to go private. The company’s shareholders approved a merger agreement with a group led by Thomas H. Lee Partners and Bain Capital Partners. But the deal fell into litigation this year when the companies sued their bankers who wanted to pull out of their financing commitment. In the light of those troubles, it looks like for the moment the radio broadcaster is unable to estimate a closing date and is not even certain that a closing will happen.

Eliza Popescu is a financial writer for the on the internet investment advisory service Investor’s Observer.

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Filed under: Marketing and advertising, McDonald’s (MCD), Burger King Hldgs (BKC), Battle of the Brands

This post is part of our Battle of the Brands feature. Let us know which brand you prefer, and check out other Battle of the Brands posts.

In this corner, the clown. After years of taking shots to the stomach, McDonald’s (NYSE: MCD) was thought to be on the ropes, but has found new life in tightened operations, successful product launches, and a new aggressiveness. It’s currently in training to take on the coffee-weight champ, Starbucks (NASDAQ: SBUX), in a no-holds-barred battle of the baristas.

In the other corner, the King. Burger King (NYSE: BKC), the burger chain with the creepiest ad campaign on television (what’s with the young dude waking up to find the King in bed with him?) has thrived on a two-pronged approach; over-the-top menu items and movie/game tie-ins. BK hit the breakfast market hard with its enormous omelet sandwich, packing a wallop of 730 calories. Its Xbox game tie-in, a cheap game featuring the King was an enormous success, setting a trend that has been widely adopted.

Both chains are thriving as the third of the troika, Wendy’s, continues to punch beneath its weight. With a three-year growth of almost 100% in its stock price, though, this bout clearing goes to the clown, on points.

Vote in our poll for McDonald’s or Burger King as your preferred brand, and let us know in the comments why you love it.

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Filed under: Competitive strategy, Apple Inc (AAPL), Marketing and advertising, AT and T (T), Research in Motion (RIMM), Verizon Communications (VZ), Qwest Communications Intl (Q), Battle of the Brands

This post is part of our Battle of the Brands feature. Let us know which brand you prefer, and check out other Battle of the Brands posts.

“I’m like Ma Bell, I got the ill communication.” — Beastie Boys

When considering these two particular companies, it is important to note their roots as offspring of the famous “Ma Bell” network. The Bell System, which has produced the most complex ongoing series of mergers and break-ups in the history of the United States, is the origin of the companies that are now AT&T Inc. (NYSE: T) and Verizon Communications Inc. (NYSE: VZ), as well as competitor Qwest Communications International (NYSE: Q). A lot has changed since those early times — remember, after all, that the second “T” in AT&T stood for Telegraph. Now phones are the latest devices to be made supercomputers. AT&T has its exclusive deal with the Apple Inc. (NASDAQ: AAPL) iPhone, while Verizon slings the Research in Motion Ltd. (NASDAQ: RIMM) BlackBerry.

Since wireless is the way of the future, the wireless divisions of these companies is the most hotly contested, and the focus of this “Battle of the Brands.” It is important to note that despite Verizon Wireless bearing solely Verizon’s name, it is not owned by just them, it is a 55%-45% joint venture between Verizon and Vodafone Group (NYSE: VOD). It is also important to note that AT&T Mobility is the service formerly known as Cingular, which was acquired by AT&T in 2006 when it bought BellSouth for $86B.

Looking first at Verizon Wireless, its strategy is simple. It focuses on the strength of its network as its main selling point. From the company’s “Can you hear me now?” ads, to the current “It’s the network” ads, the point the company conveys is that if you have Verizon, you are covered by the biggest and most reliable network. AT&T’s most memorable recent ads may be Martin Scorsese “We won’t interrupt your phone calls, please don’t interrupt our movies” ads that play at the cinema, but the company also runs television ads that focus on “more bars in more places,” which echoes a very similar message to Verizon’s about the strength of their network.

There are arguments that can be made that either network is superior, depending on your metrics — coverage area, dropped calls, strength of signal — but what matters with branding is perception, and the edge in network perception goes to Verizon Wireless, which has spent years building its image as the superior cellular service.

However, network is not the entire argument. There is also the important matter of the hardware available on each service, where AT&T took a significant lead when it signed an exclusive contract with Apple to carry its iPhone exclusively. The reason for its significance is not only that users chose AT&T over Verizon for the highly desirable device, and not just because some Verizon users switched to AT&T to get one, it is also the type of customers it got. It got the tech-savvy, 18-24 users that use more minutes, text frequently, and use data plans. These users are good for far more revenue than the older users with minimal plans that just need a good network to use their cell phone in case of an emergency.

Both companies have high-quality networks, advertise extensively, offer a ton of different cell phones, and have similar pricing models, so, like most of these “brand battles,” the decision comes down to personal preference. One thing is for sure, with over 65 million users for Verizon Wireless and over 71 million users for AT&T Mobility, this is one rivalry that will not be over anytime soon.

Vote in our poll for Verizon Wireless or AT&T Mobility as your preferred brand, and let us know in the comments why you love it.

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Filed under: Marketing and advertising, McDonald’s (MCD), Yum Brands (YUM), Wendy’s Intl (WEN), Burger King Hldgs (BKC), Stocks to Buy

McDonald’s (NYSE: MCD) announced its same-store sales results for the month of April Thursday, and the data indicate a healthy fast-food business (”healthy fast food” — isn’t that an oxymoron?).

Global comps as a whole increased 5%. Comps for European locations increased 6.3%, and the Asia/Pacific/Middle East/Africa segment saw a 7.8% rise in same-store sales. McDonald’s restaurants in the Says increased an anemic 2%. The weak domestic sales really need to be addressed so that they can pull more weight and add to the cool story that’s McDonald’s.

The stock has been a pretty decent performer over the last several months, rising over 6% over the three-month timeframe, and over the one-month period, it is up over 7%. And the longer-period returns from the past are even more impressive. Imagine how McDonald’s stock would perform if management figured out how to get people to visit the U.S.’s Golden Arches more often. I suppose April’s performance should be praised since March saw a decline in U.S. comps, as this article makes plain, but that depreciation was the first one in five years, and that states to me that McDonald’s needs to be careful.

It’s all about the marketing, of course. There are a lot of choices out there — Burger King (NYSE: BKC), Wendy’s (NYSE: WEN) and Yum! Brands (NYSE: YUM) — so I think promotion of the brand is key. Some will disagree and state that menus and pricing are the huge drivers — they are important, don’t get me wrong, but perhaps McDonald’s needs to take a cue from Burger King and its campaign with the creepy-king thing — those commercials are clever. Still, if this comps reports says anything, it says that you shouldn’t count the clown out — McDonald’s is a blue-chip stock that’s near a 52-week high, and not only is it a great long-term/core holding, but it’s also quite possibly an interesting shorter-term idea as well.

Disclosure: I don’t own shares in any company mentioned here; positions can change at any time.

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Filed under: Marketing and advertising

One of the most brand recognizable names in the world of video games has to be Grand Theft Auto. With its most recent release, Grand Theft Auto 4, the video game maker Take-Two Interactive (NASDAQ: TTWO) is already dealing with controversy after the city of Chicago “jacked” ads that the company bought to advertise its newest game release.

Since the first installment of Grand Theft Auto, the game has been one of most discussed video games on the market, largely due to its high level of violence. Video game junkies love it, while parents cringe at the thought of their kids playing the game. The game definitely deals with some seriously taboo subjects; car-jacking, prostitution, cop shootings, drive by shootings, and drunk driving to name a few. But is this really enough to justify the city of Chicago pulling paid ads for the game?

Leading up the current release of Grand Theft Auto 4, Take-Two paid Chicago a reported $300,000 to place ads for the video game on the sides of buses and transit displays for a six week period starting on April 22. After the local Chicago news questioned the city’s decision to run the ads, they were swiftly pulled. The report questioned the taste of the ads, given the violence that has escalated recently in the city.

OK, I’ll say this: the video game could be violent and questionable enough to justify the city not running the ads to begin with, but after entering into a deal with the company to run the ads, I think it is questionable whether or not they should be granted to pull the ads. Should we believe that the city was unaware of the video game’s content before accepting the contract? If so, then shame on them. If they did understand the video games genre (which I have to assume they did), then shame on them for letting the media pressure them into pulling the ads.

I’m not going to defend the content that kids see when playing Grand Theft Auto 4. Personally, I love playing the video game series, but would definitely think twice about letting a 12 or 13 year old child play it, but there is one small thing here that you may have heard of before, called the freedom of speech. I have never personally been in Chicago (at least other than its airport), but if it is like most other big cities, I have to wonder if you can drive around the city and see billboard ads for strip clubs?

A quick Google search does indeed verify the city allows strip clubs, so I’m 99% sure you can see those clubs advertised on billboards around the city. Are ads for video games really any worse? Where will the city draw the line?

In reaction to the ad jacking, Take-Two has taken Chicago to court, and is suing for its $300,000 to be returned, as well as for the ads to be replaced and run for the entirety of the contract it had with the city.

Despite the controversy, copies of the video have been flying off the shelves since its release last week, and the company anticipates to see first week sales of around $400 million. Fans stood in lines for hours and in some cases camped out overnight in order to get their first day copy of the new video game.

According to one fan, “This game has everything — sex, drugs, cars, money . . . anything you want.” For fans that is great news; for worried parents, well, that’s another story.

So if you’ve played the new game, let us know what your thoughts are on the newest release in the blockbuster game series. And, what are your thoughts on the actions Chicago took in pulling the video game ads? Should they be forced to put them back up, or does the game’s content justify the ads being pulled from the transit system?

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Filed under: Consumer experience, Competitive strategy, Marketing and advertising, Krispy Kreme Doughnuts (KKD), Battle of the Brands

This post is part of our Battle of the Brands feature. Let us know which brand you prefer, and check out other Battle of the Brands posts.

Oh, how the sugary have fallen. Ten years ago, even five, you and I both know how this would have come out. In the standoff between longtime national fried-dough pusher Dunkin’ Donuts and upstart sweet freak Krispy Kreme Doughnuts (NYSE: KKD), Krispy reigned supreme. The chain was rolling out new franchises as fast as dough circles could parade around its restaurants on shiny metal racks, and each time it did local police stations did overtime directing traffic.

Somehow, the mighty fell after the considerable sugar high, largely connected to poorly-managed finances, badly-handled expansion, and a sudden national fear of carbohydrates. All the while, Dunkin’ Donut managers everywhere continued to plod along, making the doughnuts, and quietly stirring a blue-collar breakfast revolution. One day America woke up and realized, hey, Dunkin’ Donuts’ coffee is good! Someone named it “Better than Starbucks” and it soon became clear that the product guys had realized something: we make a lotta money off of coffee. Actually, more than half of the company’s revenue.

Soon Rachael Ray was perkily declaring her love for Dunkin’ Donuts (pointedly never eating a doughnut in a commercial), Dunkin’ Donuts coffee was available in grocery stores, and Krispy Kreme doughnuts were growing stale in their plastic cases. The company couldn’t even find a way to make a trans-fat-free doughnut, let alone win back the enthusiasm America had once felt for the iconic glazed dough circles.

While today it’s my belief that more Americans love Dunkin’ Donuts than Krispy Kreme, it’s interesting to note that it’s not because of any superiority in the powdered chocolate creme-filled pastry (oh, how I loved you once upon a time!). No, it’s all in the rest of Dunkin’ Donuts’ menu — and perhaps its working-class, no-fuss cred — and it’s unlikely Krispy Kreme will ever be so hot and fresh again.

Vote in our poll for Krispy Kreme or Dunkin’ Donuts as your preferred brand, and let us know in the comments why you love it.

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Filed under: Earnings reports, Good news, Consumer experience, Marketing and advertising

Shares of digital television provider DirecTV Group Inc. (NASDAQ: DTV) have been rallying in early trading as its earnings numbers for the first quarter were better than analysts had forecast. The company also announced its board approved an increase in its stock buyback program, raising it to $3 billion.

The company said its first-quarter profit rose 10% to $371 million, helped by higher subscriber additions. DirecTV was able to slightly come in above analyst estimates, with 32 cents per share compared to the forecast 31 cents per share. Compared to its first period last year, earnings were up, as the digital television provider came with earnings of 27 cents a share last year.

The nation’s largest satellite-TV company posted a respectable growth of 17% for its first-quarter revenue, which jumped to $4.59 billion compared with $3.91 billion a year ago. This was above analysts’ predictions for quarterly revenue of $4.47 billion, according to Thomson Financial.

During the period, DirecTV added 275,000 net subscribers in the United States, and also benefited from a 14% increase in U.S. sales due to strong high-definition and video recording services demand. DirecTV also said it would privately offer up to $1.35 billion in senior notes and borrow about $1 billion under its existing senior secured credit facility to fund the buyback.

Wall Street expressed enthusiasm over DirecTV ’s positive earnings figures, and pushed shares of the company up 3.64% in pre-market trading.

Eliza Popescu is a financial writer for the online investment advisory service Investor’s Observer.

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