The cheapest food in the world

by drm on July 5, 2010


I was struck the other day by the observation that the start of our current recession was sharper than the Great Depression and that the steps taken by governments around the world to provide financial stimulus helped to moderate the decline.

That observation got me thinking about how different the images of this recession are from the images of the Great Depression.

The New York Times had a long article in the Week in Review section this week that captured some of the underlying difference.

A great many people have lost faith in powerful institutions, from Congress to Goldman Sachs. Yet beneath the bitterness coloring national affairs — down at the level of neighborhood, family, coffee shop, tavern — a tenuous belief in the collective good remains, perhaps moderating national dismay.

I don’t think that the Times article intended to demean the level of suffering and pain that individual people a experiencing during this downturn. But they captured something of the zeitgeist that I experience as a I travel around the country. People are carrying on, often with a tremendous amount of energy and a degree of mobility and connectedness that is unmatched by any time in our history.

That perspective made the chart above particularly powerful.

One dramatic difference is the relatively low cost of food in the U.S. compared to other places in the world. The affordability of food is driven by diverse factors, including vast natural resources of our country, federal subsidy programs, efficiencies in distribution and innovations in preservation.

And compared to other countries, there’s no other place on the planet that has cheaper food than the U.S. (2008 data here). The 5.5% of disposable income that Americans spend on food at home is less than half the amount of income spent by Germans (11.4%), the French (13.6%), the Italians (14.4%), and less than one-third the amount of income spent by consumers in South Africa (20.1%), Mexico (24.1%), and Turkey (24.5%), which is about what Americans spent DURING THE GREAT DEPRESSION, and far below what consumers spend in Kenya (45.9%) and Pakistan (45.6%).

When you don’t worry about where your next meal comes from, you can afford to feel optimistic and energetic. The relatively low cost of food in our country is an important element in keeping that positive viewpoint up

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American consumers are being pragmatic and cautious, indicators show

by drm on June 15, 2010

The flush of this Spring’s economic activity is wearing off and the American consumer is being realistic about the economy’s prospects.

One indicator can be seen in the muting of the consumer outlook from BIGResearch in June.  Sentiment about the chances for a strong economy were down from May and unchanged from a year ago.

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Sentiment is up a long way from the dark summer of 2008, the mood of the last year has stayed relatively unchanged, despite renewed economic activity.

The embedded caution about the economy is reflected in how Americans describe their approach to spending.  74.1% of Americans say they are living a simpler life, according to BIGResearch.   On balance, they are happy about this increased simplicity.  For sure, they are redefining luxury:  84.1% say they aren’t ready to spend on luxury items.  The way luxury gets defined is shifting also, as demonstrated in people’s responses.

luxury.pngThis sentiment puts some of the recent economic reports in context.  As summarized in the blog Calculated Risk’s weekly update, the momentum in retail sales is lagging and underlying economic activity is steadying after a rebound to refill inventories that had been allowed to diminish during the initial slump in consumer spending.

These observations were echoed last week in the release of the Federal Reserve Beige Book, which looked at economic activity through May

Economic activity continued to improve since the last report across all twelve Federal Reserve Districts, although many Districts described the pace of growth as “modest.” Consumer spending and tourism activity generally increased. Business spending also rose, on net, with employment and capital spending edging up but inventory investment slowing. By sector, nonfinancial services, manufacturing, and transportation continued to gradually improve. Residential real estate activity in many Districts was buoyed by the April deadline for the homebuyer tax credit. Commercial real estate remained weak, although some Districts reported an increase in leasing. Financial activity was little changed on balance, although a few Districts noted a modest increase in lending. Spring planting was generally ahead of the normal pace, while conditions in the natural resource sectors varied across the Districts. Prices of final goods and services were largely stable as higher input costs were not being passed along to customers and wage pressures continued to be minimal.

The signs suggest that consumer has recovered, but that the recovery is marked by a wide-eyes pragmatism about a weak economy with little momentum for growth.

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Social media marketing drives search traffic 61% for one small business: a case study

by drm on June 7, 2010

Any small business looking at social media ultimately has to ask, What business benefit am I going to get from being active in this media? No matter how compelling the user statistics are, any commitment of time for a small business needs to be rewarded with results.

I thought it would be useful to share a detailed case study on how one small business has leveraged a content marketing and social networking strategy to drive measurable business results.

Situation:

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TMG Brand Communications is a boutique public relations and marketing communications agency in New York City. Established in 1994, the agency has developed a particular expertise serving accounts in the financial services, lifestyle and media sectors. TMG is focused on creating broad-based communications programs that convey the distinctive attributes of brands and help drive business results. [Disclosure: The principal of TMG Brand Communications, Tami McCarthy, is my wife.]

The company’s purpose is summed up on its website.

The thrill of developing a brand’s personality, giving it a voice of authority in the market and having it resonate and drive a target audience to act or think differently inspires everything that we do at TMG Brand Communications.

Over the past several years, TMG has developed a suite of skills in internet and social media marketing. One of its most notable initiatives was the integration of social media with a live webcast to launch the Citi Forward card from client Citi Cards. (A description of the project from social media maven Mack Collier can be found here.)

Not surprisingly, TMG had not developed a plan to leverage its social media marketing expertise to elevate its own profile. Tami was an early adopter of social media platforms, with an active presence on Twitter and profiles on services like Facebook and LinkedIn, but had not developed an integrated strategy for using these tools to benefit the agency.

Like many of its peers, TMG did have an excellent web site which presented its capabilities and a sample of its work. However, the site was lightly trafficked. Most of the visitors came directly to the site, driven by TMG’s distribution of its URL on its business cards and stationary.

Tactics:

In the last quarter of 2009, TMG decided to develop an integrated strategy to use social media marketing to elevate its brand presence.

The strategy was designed to add a content marketing component to an already active social networking presence. In addition, the strategy linked personally-branded social networking activity on platforms like Twitter and Facebook with the digital identities of the overall agency.

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In order to accomplish the strategy, TMG established a blog on a sub-domain of the tmg-media URL. This blog, buzzcloud.tmgpr.com, was set up using WordPress and the Cordobo Green Park theme. The agency also created a TMG Brand Communications fan page on Facebook, pointing the page to the primary TMG domain. The Networked Blogs application was used to distribute blog posts to the Facebook page, and a plug-in was used to distribute posts to Twitter.

A general content outline was developed in order to give focus to the blog posts. Tami is the sole author of the posts. The purpose of the posts is to share observations and suggestions about topical communications challenges. The content only peripherally touches on TMG clients. In addition, the content plan assumed that new posts would be created every two weeks or so, so that the burden of creating content didn’t weigh down an already highly-productive team.

Results:

Tami McCarthy’s BuzzCloud was launched in November 2009. Results for the subdomain buzzcloud.tmgpr.com were tracked separately from the results for the www.tmg-media.com domain so that the impact of the new content strategy could be accurately measured.

That impact was immediate.

In the six months following the launch of the blog, TMG increased web traffic to its TMGpr.com agency site and to its new blog, Buzzcloud, by 198%.

Hidden within this gain are a couple of data points that demonstrate the impact of a well-executed content marketing and social networking program.

  • Visits to TMGpr.com, the agency site, increased 32% in the six-month period following the blog launch;
  • Search engines drove 61% more traffic to the agency site in the six-month period;
  • The number of keywords that drove traffic to TMG’s agency site gained from 425 to 1,178 in the six-month period.


After launching Buzzcloud, TMG became much more visible on search engines, particularly Google. TMG became visible because it began to publish original content with more frequency. Each of those blog posts were distributed into TMG’s digital footprint, and as people clicked through to the site, or redistributed the content their own digital footprint, TMG began to develop a broader network of digital breadcrumbs, all of which led Google and other search engines back to the TMGpr.com web site.

Increased web traffic to the agency site was not the only indirect benefit of the social media marketing program. The digital footprint of both TMGpr and Tami McCarthy expanded dramatically, generating increased brand heft and awareness.

The easiest way to assess the heft of a brand’s digital footprint is to type the name into Google. The phrases “TMGpr” and “Tami McCarthy” both return relevant results that dominate the first page of Google.

Most people who are interested in you or your company are likely to search for you on the web. A Google search that returns a page filled with relevant links creates an aura of credibility and authority for your brand. It isn’t enough for those links to exist, however; behind them there needs to be useful and relevant information, the kind of search outcome that is Google’s brand promise.

This program has not required an incredible amount of time to execute. The most time-consuming aspect is creating the original posts. Maintaining the social networking presence is a matter of intermittent focus; TMG uses Facebook and Twitter to share interesting content, give personal updates and re-distribute content that other people have created.

What’s fascinating about this case study is how important the creation of content has been to driving overall web traffic.

During the six-months ending November 2009. TMG executed its social networking program actively. It did not, however, have an active blog. As a result, the social networking had virtually no effect on the company’s web traffic.

Launching the blog and publishing content drove a tremendous amount of traffic.

One lesson is that social networking without content marketing will not drive clearly measurable results for your business.

Of course, the big question is whether this activity has any impact on your business results.

For TMG, social media marketing has helped to drive increased visibility, more business inquiries and ultimately more account. Go take a look at the agency’s blog to see just how much.

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NCI announces that it has opened restructuring discussions with its creditors

by drm on June 4, 2010

Yesterday we announced that our company,  Network Communications, Inc. , had opened conversations with its creditors in order to restructure its balance sheet.  The  development was reported in Business Week and has appeared in numerous news outlets across the web.

The Business Week reporter did a balanced job in describing the situation.  I think one quote sums it up pretty well.

“It’s not a company with a fundamentally broken business model,” McCarthy said. “It’s a company that’s gone through a radical adjustment in size.”

I’m not going to comment on the restructuring process.  A lot of media companies, such as  Reader’s Digest and Freedom Communications,  have gone through restructurings the last two years, emerging successfully as viable businesses with manageable capital structures.

Right now we’re focusing on communicating clearly with our core constituents about what the announcement means for our business.  The short answer is, It’s business as usual.    NCI is in the enviable position of generating more than enough cash to fund its day-to-day operations.

To help spread that message, we sent out copies of our press release and a detailed Q&A to our employees and business partners.  I’ve held a series of webinars to review the materials and address any specific questions.  We’re also reaching out to our key vendors and customers.

I’ve also focused on another message:  Our future is what we make of it.

The difficult market conditions of the past two years have driven us to be more disciplined, more resourceful and more innovative.  This approach has borne tangible business results:  We have expanded our customer relationships, we have built new products, we have strengthened existing products and we have managed in such a way that we’ve been able to sustain our business model.  We’ve been able to do this because of the remarkable focus and commitment of the people who make a difference every day:  The employees and independent distributors associated with the company.

Right now we are facing two basic facts.  Unquestionably, an economic recovery is underway.  Unquestionably, our customers have been shocked by the changes in their business and are reluctant to increase their marketing spend.

To rebuild our business, we need to help resolve the contradiction between those two facts.  We can do this three ways:

  • We have to be in front of our customers and help them see that market has improved enough for them to feel confident that they will get a return on increasing their marketing spend;
  • We have to be fluent in explaining why our traditional businesses continue to provide value to our customers, in terms of visibility, leads and business results.
  • And we have to be energized in showing our customers how our innovative new services, particularly in Internet and social media marketing, can give them powerful ways to expand their brand footprint and build their business.

Executing on these three activities is the most important thing that we can do right now.  That is how we will make our future.

A note:  I have closed comments on this post because of the sensitive nature of this dialog.  If you have any questions you can e-mail me at dmccarthy@nci.com.
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A practical approach to leveraging social media from two top editors

by drm on May 25, 2010

A couple of months ago, Adam Japko and I sat down with two of our top editors to discuss the impact of social media sharing on the traditional magazine editorial workflow.  The conversation was stimulating and I thought it would be useful to share some of my notes, since the observations from the meeting form a practical framework for implementing a content-sharing model within a traditional magazine team.  (For background on the content-sharing model, you can see this post from last year.)

Diane Carroll is the editor of At Home in Arkansas and Clint Smith is the editor of Atlanta Homes & Lifestyles. Both have been at the forefront of integrating social media sharing into the day-to-day routine of their magazines.

The work of their teams has contributed to significant increases in web and Facebook activity around the brand.

Our conversation focused on what changes were necessary to execute the social media sharing and about what impact the sharing has had on their market presence.

The Conversation:

Diane opened the discussion by talking about how expanding the social media channels for At Home in Arkansas has changed the way she thinks about people and projects in her market.

She related an example where she was talking with a design resource in her market who wanted to get coverage in the magazine.

In the past, a limited inventory of editorial pages would have prevented her from giving this resource coverage, Diane shared.

With the addition of social media channels, there are multiple ways to share information about this resource with her audience: creating a blog post, doing a Facebook update on the fan page, and, in this instance, inviting the resource to do a guest post for the At Home blog. The resource came through with “a really great post,” Diane shared, that was interesting and useful.

The social media outlets that At Home and Atlanta H&L have developed are big benefits, Clint and Diane agreed, creating an entirely new way of distributing information, creating an interactive and energetic face for the brand and building their brand presence broader in the market. A simple act like updated the Facebook fan page keeps people very engaged, they observed.

The key to integrating social media into the overall workflow is improved long-range planning and execution of the editorial calendar.

Clint and Diane are experienced, seasoned editors, so it was interesting to discover that both of them had created the bandwidth for executing their social media programs by leveraging and improving their execution of an old magazine tool – the editorial calendar.

The focus was two-fold: improving the execution of the long-range features in the magazine editorial calendar, so that they weren’t racing to get pieces finished right at deadlines; and creating an editorial calendar for the social media content, so that they had a clear expectation of what work would get done when by whom.

The first task was to improve upfront planning. Both editors said that their upfront planning and execution on the print issue had improved as they had increased their social media activities. Without being explicit, it was clear that both Diane and Clint had used improvement of the existing processes in order to create the time resources needed to execute their social media plans.

The second task was to make the social media activity more routine. This required taking the same planning approach to social media as was used for the print issues.

Both At Home and Atlanta Homes & Lifestyles have created weekly social media content schedules.

These schedules are designed to achieve several goals:

  • Share all of the content in the issue through the social media channels;
  • Keep a regular flow of content on the brand blog and Facebook pages;
  • Increase interaction with other bloggers in their topic area and market;
  • Increase engagement with the community around their brand.

At Home has structured is weekly calendar around topics:

  • Monday: General post
  • Tuesday & Thursday: Share content from the latest magazine issue. This can be a Room of the Week, or a fashion segment, or a design project.
  • Wednesday: Recruit a guest blog, typically from someone who has been featured in the magazine;
  • Friday: Friday Favorites, a list of links to other blogs and comments that the staff found interesting during the previous week.

Altanta Home & Lifestyle has addressed the structure of its social media sharing by assigning a specific day of the week to different members of the content team. On that day, the team member is responsible for sharing something of value and interest on the blog and the Facebook page

This “staff blogger” schedule has helped to take the anxiety out of trying to make sure some content is being created each day. It also has the benefit of being predictable for the online audience; over time, a reader will notice that one of their favorites posts every Thursday, for example.

Creating a social media schedule shifts the focus and energy of the content teams, both Clint and Diane observed. One change is that the teams begin to look to other bloggers more. They’ve discovered that bloggers have an identity in the market much like top architects and interior designers. By bringing the bloggers into the umbrella of the brand, it increased the magazine’s presence.

Our discussion closed with some observations about the impact of social sharing on the market.

Clint and Diane commented that the “sense of connectedness” was  different. Things are more interactive: they get comments and ideas from a community that is enormously positive.

As editors, they are seeing more and more overlaps among the ways that they distribute information, and are thinking about new ways to integrate things.

In order to continue to draw benefit from this social sharing activity, the editorial teams would benefit from increased access to the results that they are driving, both in terms of audience to specific posts and sections of the web site, as well as the relative value of this audience to any advertising customers.

In the future, the editorial and sales teams will also need to coordinate the amount of audience that needs to get driven into specific sections of the web site and towards specific customer groups, so that the potential number of conversions to client activity is lined up with the expectations of the clients.

Conclusion:

An editorial team needs to implement four steps in order to increase the consistency and effectiveness of their social media sharing program.

  1. Assess and improve traditional planning and workflow:
    Many editorial teams can create incremental time by being more structured in their long-range planning and in creating their larger features with a longer lead time.
  2. Set specific monthly goals for your social media content
    1. Feature magazine content in individual posts
    2. Guest bloggers
    3. Featured blogs and comments
    4. Online-only features
    5. Community engagement
    6. Traffic/audience
    7. Fans
  3. Set up a weekly content plan
    1. Establish a social media content schedule
    2. Assign specific elements or days to individual staffers
    3. Communicate content schedule to entire team
    4. Have monthly meeting to review social media assignments and results
  4. Track results & feedback
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A framework for leveraging social media in traditional publishing from Junta Joe

by drm on May 25, 2010

Over at Junta 42, Joe Pulizzi has put up a great post on how publishers leverage social media tools to grow their online footprint.  Recommended reading for everyone in the publishing business, as Joe has synthesized a number of different perspective and added his own unique and experiences point of view.

The key issue is defining your goals correctly and aligning your teams around those goal. Says Pulizzi:

If you believe that your core business is publishing, then you are competing with the entire world (we are all publishers today). As a publisher, you need to rethink your business (are you in the business of providing engaging experiences for your niche customers?).

In the post, Joe linked to one of my posts from last July where I laid out a model for content-sharing that we had begun to implement with our regional home design magazines.

We’ve been working this content-sharing approach for close to a year and it’s had measurable impact on our consumer engagement, market presence and revenue opportunities. In this post, I share some of the ways that our top editors have integrated content-sharing into their workflow.

For those who are interested, here’s Joe’s presentation:

The Social Media Publishing Model for Publishers

View more presentations from Joe Pulizzi.
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