Monday, April 19, 2010

It’s a beautiful day in the neighborhood

From Troy Michigan to Mid-Town Manhattan, milk men are making a comeback. But home delivery is just part of a larger trend of people going local, and it’s starting to go big. Post-recession many attitudes have reset, and a growing number of people are becoming increasingly concerned about the health of the products they buy, the environmental impact of their lives and feel genuinely good about supporting local businesses and organizations.

It all started with food. And, while organic food has recently made it onto most grocery store shelves, the movement originally developed from locally oriented co-ops and communities supporting independent organic farmers. People concerned with natural food have been shopping at farm stands for years, and for this community local is a part of their DNA. And, now that organic has become mainstream these core values are making their way into the popular consciousness along with the products themselves.

The perceived benefits of shopping locally go beyond concerns of quality and freshness. The trend appeals to their attitudes about the importance of community and living green. Shopping locally mitigates the environmental impact of moving food thousands of miles and thus concerns about carbon footprints. It also fulfills a desire to support small farmers and the local economy. These “localvores” find practical and emotional benefits buying local.

Grounded in a strong core of “believers,” this trend is steadily growing. Beyond organofiles and environmentalists, foodies and moms are getting into the trend, too. Today, people shop 5,000 farmer’s markets across the country, the result of more than 5% annually for the past five years, and “nearly 60% of consumers say they try to shop at a farmers market.

But, local isn’t just for fruit stands and apple picking. A new and unlikely champion of the local movement, Walmart is stepping up its efforts to support locally grown food in order to compete with stores like Whole Foods and Trader Joe’s. Aggressively supporting not only organic, but local farms as well, “Walmart says it wants to revive local economies and communities that lost out when agriculture became centralized in large states.” With major support like this, the local movement has serious potential for scale.

Beyond the dinner table initiatives are gaining ground encouraging consumers to buy locally grown goods and services. Earlier this year Business Week wrote that, “About 130 cities or regions now host ‘buy local’ groups, representing about 30,000 businesses, up from 41 in 2006.” Fueling this growth are organizations such as Local First, the 3/50 Project (begun just last March) and, which aim to educate consumers about thinking locally with their wallets and the big impact that small shifts in spending can have on their towns and neighborhoods.

Local is making waves in politics as well. A recent Zogby poll found that “52% [of people] paid the same amount of attention to local and national races,” and groups like Tea Party and Coffee Party USA show it’s clear people getting engaged, too. Spreading online, these organizations are growing locally with chapters and meetings in towns and cities across America.

Finally, from organic tea to tea parties, localvores and local activists may be more plugged in than you think. A recent study by Pew Internet suggests that, contrary to popular belief, “many internet technologies are used as much for local contact as they are for distant communication.” Further, evidence shows a strong correlation between digital literacy and local engagement that’s becoming increasingly apparent among young people, indicating some serious potential for continued growth. It's no secrete that services like CoupMe, Boston Tweet, Yelp and Four Square are making a serious impact by re-connecting people to their neighborhoods.

Implications for Brands:
1. Consumer’s have a new definition of healthy food. Beyond quality they are concerned with the health of the environment and their local economies.
2. Localvores derive real satisfaction from “living responsibly” and have a strong desire for community involvement.
3. Larger brands may find it particularly difficult to establish authentic and believable associations with locally minded consumers.
4. People are finding new ways to translate their virtual communities into real life groups, thus one of the best ways to reach locally minded consumers may be through Google and online forums.

Monday, April 12, 2010

Content is a right, not a DVD

How many times should I have to buy a DVD? In an ideal world, just once.

I don't look at movies or music the way I used to. I think it happened at about the same time I ripped all the music from my CDs to my computer, because suddenly I had two copies: one real and one digital. As long as it doesn't explode (fingers crossed), that content is on my computer forever. With everyone doing this now, I'm going to assume other people are seeing content differently as well.

Virtual and hard copies of content aren't on equal footing. Should my notebook burn down, I still have the CDs as back ups. iTunes not only doesn't send a CD (I mean, I'm paying full price and I'd just rip it anyways, so can you just send me the 15 cent disk?) or offer me more than a single download. Plus, my CDs have a sentimental value and they are something physical I can hold and love (unless my computer was burned due to a larger house fire...). No matter how digital I get, a hard copy is something I will value more because virtual content feels secondary, frail and less real.

As a result, I don't value virtual content very highly, and I'm often appalled when I see iTunes is charging full price. I think this is probably a big driver of illegal downloading--I don't know if people really feel they are "stealing" as digital copies are not considered as valuable--because, you can't download a real car, or a real DVD. I refuse to pay full price for a one time download.

If content is a right, not a DVD, I think we need to reevaluate some things.

Image: source

Monday, April 5, 2010

TV’s Missed Opportunity

video game night, invasion from space #2

Right now people are watching more premium content than ever, take Net Flix, Hulu, iTunes/ Amazon and then pile on illegal downloading and you have more eyes than ever before. This is an opportunity for premium content producers, e.g. TV networks, movie studios, but unfortunately it's not being framed that way. The business problem is how to monetize those eyeballs. And, while ad rates remain low on sites like Hulu it seems that pay walls are the only answer.

I'd argue that there is a better way.

First, I think sites like Hulu need to get more research on how their ads are watched. I've found that most people I know settle in to watch shows on Hulu, and the very same people that fast-forward on their DVRs are watching the two minute ads on Hulu. Further, most audiences accept that watching ads with your TV show is part of the deal, and most viewers are down with watching them.

Second, premium content needs a business model that's a little more creative. And, as content becomes increasingly detached from specific channels, there should be a greater focus on attaching ads and building revenue on the content itself.

For example, allowing for free downloads with commercial breaks built in, perhaps they could even update periodically? Or give users an interactive experience that unlocks programming via engaging with brands. We could create a whole new type of ad format/ interactive experience for online viewing--like movie trailers (very much enjoyed) make online ads part of the whole viewing experience. Lastly, could we reach out to people who have already downloaded illegally, asking them to register their copies if they enjoy the shows, or to watch ads to help support them?

Finally, people care a great deal about their shows. They feel a sense of personal ownership with the programs they love, and beyond just wanting free programming would also seek to preserve it if given a chance or a way to show their support.

My point is this. Consumption is up, way up. Along with these new habits people also have greater emotional investments in the programs and movies they watch. But, the more the industry denies access the more eyeballs they lose to illegal consumption. Instead, they need to harness the new passion for premium content people have and get creative about making money with all those eyeballs, whatever screen they are on.

Update: A great piece by Carol Phillips on Millennial Marketing cites my article on this topic recently published by TNGG.