MONEY facebook

Why You’ll Never Leave Facebook for Ello

140930_INV_Ello
Berger & Föhr is a graphic design studio in Boulder, Colorado. Its partners, Todd Berger & Lucian Föhr are Co-founders of Ello. Ello

It’s hard to build a large network using a freemium strategy.

By no means was Facebook FACEBOOK INC. FB 0.0506% the first major social network, nor will it be the last. MySpace and Friendster predated Facebook, and Twitter came after it. There’s a new social network in town now positioning itself as the “anti-Facebook,” and its primary pitch is the notable absence of any ads. Should Facebook be afraid?

Say hello to Ello.

Why now?

Over the past few days, Ello’s popularity has soared, even though the service launched in private beta in March. One reason why some users are now flocking to Ello is that Facebook has recently begun to crack down more on enforcing its longtime “real name” policy. That’s created tension within specific communities, such as the LGBT community, that prefer not to use their real names for personal privacy and protection.

The service is currently invite-only, but requests for invites have skyrocketed in recent days, particularly as media attention escalates. The site was created by artists and designers, and offers a minimalist interface. The company’s “manifesto” outlines Ello’s philosophy quite clearly:

Your social network is owned by advertisers.

Every post you share, every friend you make and every link you follow is tracked, recorded and converted into data. Advertisers buy your data so they can show you more ads. You are the product that’s bought and sold.

We believe there is a better way. We believe in audacity. We believe in beauty, simplicity and transparency. We believe that the people who make things and the people who use them should be in partnership.

We believe a social network can be a tool for empowerment. Not a tool to deceive, coerce and manipulate — but a place to connect, create and celebrate life.

You are not a product.

Interestingly enough, the language is very similar to Apple CEO Tim Cook’s recent letter on privacy, which was a clear shot at Google: “A few years ago, users of Internet services began to realize that when an online service is free, you’re not the customer. You’re the product.”

An ad-free social network sounds differentiated and idealistic, but should Mark Zuckerberg be losing sleep over Ello’s entry? Nope.

Ello’s monetization strategy is questionable

Fact: every company needs a viable monetization strategy. Most social networks and free Internet services to date have all relied on ad-based revenue. If Ello hopes to expand its service and grow its user base, the required funding will have to come from somewhere. Data centers and software engineers aren’t cheap.

Ello has raised $435,000 in venture capital funding from Vermont-based FreshTracks Capital. Ello’s founders still own over 80% of the company, so FreshTracks can’t quite call the shots yet. FreshTracks isn’t looking to make a quick buck, and has bought in to the value proposition that Ello is pitching to users. Namely, that Ello will not sell user data or insert ads.

Inevitably, Ello will need to make money somehow, in part to satisfy the return requirements of its venture capitalists, even if FreshTracks has a long time horizon and is willing to wait it out. It turns out that Ello hopes to use a strategy that’s been taking over mobile gaming: freemium.

Ello’s strategy will be to offer higher-value services and features that users will have to pay for. The basic service will be free, but the company will try to upsell and generate its revenue directly from users. This strategy is questionable at best, but it can theoretically succeed with a niche audience. Mainstream users are likely not willing to open up their wallets to use a social network.

Seemingly every year, speculation arises that Facebook is preparing to charge monthly fees, and every year these hoaxes get shot down. Facebook then added, “It’s free and always will be.” to its homepage back in 2011 just to put the matter to rest.

There’s even one that originated from The National Report circulating right now, claiming that Facebook is preparing to implement a $3 per month fee. The National Report may not have the same brand cachet of The Onion, but it’s similarly a satirical news site. The report quotes a likely fictional Facebook spokesman as saying, “There’s so many pictures of cats, and all of those costs add up, we just can’t foot the bill any longer.” That sounds legitimate.

It’s also worth noting that Facebook itself effectively has a freemium business in the form of its payments segment. This segment is mostly comprised of Facebook’s cut when developers sell digital goods, but also includes revenue from user paid services such as promoting personal posts, among others. Guess which business is doing better.

Source: SEC filings

While Ello is unlikely to begin selling virtual tractors, it’s debatable whether or not it can build a large-scale social network using a freemium monetization strategy. It could work on a niche scale though.

Hating ads is not enough

Having a philosophical disdain for ads is misplaced and perhaps naive. Hating ads assumes that users derive absolutely no value from them, which couldn’t be farther from the truth. A small percentage of people do end up clicking relevant ads that appeal to them, and they end up purchasing something that they value. For the rest of us, the ads are a more viable way to fund the underlying free service.

Facebook expects to spend $2 billion to $2.5 billion on capital expenditures this year to build network infrastructure, construct data centers, and purchase servers. Without the backend infrastructure, the service would suffer terribly. If Ello’s user base begins to explode, and it lacks the funds to beef up its infrastructure, the service will suffer and users will return to the familiar Facebook.

Then there’s the basic tenet that social networks derive all of their value from network effects. Let’s say you loathe Facebook’s ads, which can admittedly be obnoxious at times, and are looking for an alternative place to post about what you ate for lunch.

If you choose a network where none of your friends or family have joined, no one will ever know what you ate for lunch. Your contacts have to hate ads just as much as you do, and that’s a tall order to fill in this day and age where netizens have developed a practiced apathy for ads in exchange for free services.

Facebook has nothing to worry about.

MONEY Odd Spending

12 Things Made for Kids That Are Now Being Marketed to Adults

Who says kids should get to have all the fun? Not the forces behind a wide range of seemingly juvenile foods, products, and places that are increasingly being sold to adults—plenty of whom are happy to play along.

It’s hard to remember a time when video games and comic books were enjoyed almost exclusively by people under the age of 18. But that was the case a mere couple of decades ago, before both began featuring violence, profanity, sex, and other material not appropriate for young children. Along the same lines, in recent times many other things long associated with kids are now being marketed to adult consumers. Here are a dozen examples:

Gummy Vitamins. A string of studies indicating that vitamins appear to be largely a waste of money has resulted in flat sales for the once sizzling vitamin market. It looks like consumers are getting the messages spread by researchers in the field, who point out that while vitamin supplements are correlated with better health, there is little proof of causality because the people taking vitamins tend to healthier and take better care of themselves in the first place. But if consumers are dubious about the benefits of boring old-fashioned vitamins, they appear less skeptical about vitamins “disguised as candy,” a.k.a. gummy vitamins. Once popular only with children, colorful, chewable, sweet-tasting vitamins are now ubiquitous in stores’ adult vitamin sections, and makers of such adult vitamins say that the category has been enjoying “explosive growth” of late.

Walt Disney World. In some ways, Disney World has always been marketed to adults—who often say they enjoy “feeling like a kid” while touring the theme parks sans children. Some even wish Disney would host child-free days when adults could hit the rides without having to deal with the young whippersnappers clogging up the parks. While that’s highly unlikely to ever take place, Disney has taken several steps over the years to appeal to adult-only clientele, including the introduction of booze for sale at the Magic Kingdom, as well as special events like $35 “After Hours” party with alcohol and tasting menus, and, most recently, a $79 “Food & Wine Late Night” at EPCOT.

Pop Tarts. While interest in breakfast cereal has collapsed in recent years, sales of another kid favorite at the breakfast table, Pop Tarts, have risen each and every year for more than three decades straight. The Wall Street Journal noted that while Pop Tarts are most popular with teens and younger children, “adults reach for them as a retro snack.” It’s not just nostalgia that’s drawing adults to Pop Tarts, but that, “Shoppers increasingly want quick breakfasts they can eat with one hand on the go.” Over the years, Pop Tarts and its imitators have periodically tried out products more directly marketed to adults and foodies, such as “Toaster Pastries” in flavors like Cherry Pomegranate from Nature’s Path.

Happy Meals. McDonald’s briefly tried to market a “Go Active Happy Meal” for adults a decade ago, with a salad and an exercise booklet instead of chicken nuggets and a plastic toy. It obviously didn’t catch on—very few healthy fast food items are successful—but this fall, the Happy Meal for Adults concept is back, bizarrely, in the world of high fashion. Nordstrom is selling a series of pop culture-themed items from Moschino, including an iPhone case that looks like a McDonald’s French fry container ($85) and a Happy Meal lookalike shoulder bag that retails for over $1,000.

Backpacks. In what could be considered a sign that adults really don’t want to grow up, backpack sales are up dramatically among consumers ages 18 and up—including a 48% rise in backpack purchases by female adults over a recent time span. Valentino, Alexander McQueen, and Fendi are among the many fashion designers to feature posh leather and camouflage versions of the bag normally associated with high school and college kids, only theirs sometimes cost $2,000.

Lunchables. OK, so neither Kraft nor its Oscar Mayer brand actually markets Lunchables to adults. But the Adult Lunch Combos look eerily like Lunchables only without Oreos or Capri Sun, and everyone is referring to the new protein-packed prepared lunches as “Lunchables for Adults” even though the real name is the Portable Protein Pack.

Obstacle Courses. Kids have playgrounds in town parks and schools. What do adults have to help keep them in shape while also having fun? The gym doesn’t qualify because, for most people, working out is work, not fun. The exception is when the workout allows adults to swing, jump, get dirty, and challenge themselves on courses made specifically for them, like those on the popular TV show “American Ninja Warrior” and on Tough Mudder and other extreme obstacle course races. This fall, Las Vegas is even hosting an “Adult-Themed” course where the obstacles have names like the Dominatrix Dungeon and the Blue Balls Dash.

Sugary Cereals. A big reason that cereal sales have dropped is that fewer kids are eating them for breakfast. Yet as parents try to sub in healthier fare as a replacement for kid-favorite sugary cereals, the cereal giants appear to be having some success reaching a different audience—the parents themselves. Baby Boomers and Gen X, who grew up craving the sugar rush provided by a bowl of neon-colored goodies on Saturday mornings, are now being fed heaping doses of nostalgia, in the form of cartoon-character cereals brought back from the dead and other adult-focused marketing efforts. The fastest-growing consumers of Trix and Lucky Charms are, in fact, older adults.

Legos. “The Lego Movie” was certainly clever and entertaining enough to warrant an adult audience, especially among those who grew up building with the bricks. Lately, Lego has been making another appeal to adults. Several Legoland Discovery Centers—which normally attract families with children under the age of 10 or 12—have been offering special Adult Nights, where all visitors must be 18 or over.

Fruit Roll-Ups. Many adults would probably be embarrassed if they were caught eating Fruit Roll-Ups, delicious though they may be. How can you avoid being kidded about your preference for what is a quintessential kid snack? Easy. Call them something more adult-sounding, such as Fruit Strips or Fruit Leather.

Hot Pockets. Last year, Nestle attempted to broaden the Hot Pocket demographic—typically, teen boys and slacker college kids who don’t want to cook or even order pizza—by introducing gourmet versions featuring angus beef, hickory ham to appeal to adult foodies.

Halloween. October 31 used to be about children trick-or-treating door to door in their neighborhoods. Now it’s the centerpiece of a whole Halloween season where the kids are invited to enjoy only some—but by no means all—of the fun. A year ago, adults spent roughly $1.2 billion on costumes, compared to $1 billion spent on costumes for kids. Roughly 7 out of 10 college-aged adults plan on dressing up for Halloween, which explains the sales success of oddly “sexy” costumes of pizza slices or corn fields. Or sexy nuns. Adults also tend to spend more on their costumes than they do on Halloween outfits for kids. So that explains why companies are marketing the holiday to adults more and more. Still, it’s hard to come up with a good explanation for the existence of the Sexy Pizza Costume.

MONEY Food & Drink

Nostalgia SURGE! Cult Favorite Foods & Drinks Back from the Dead

Twinkies Chocodile
Hostess

Fueled by nostalgia—and often, outcries on social media—the snacks, sodas, and beers you haven't been able to buy for years are making big comebacks.

There’s no mystery as to why malls play old Christmas songs, why retro products and brands pop up regularly in the marketplace, and why advertisers are constantly trying to evoke memories of our youth. But if anyone had any doubts, the results of a study published over the summer by the Journal of Consumer Research show that we’re more likely to spend money when we’re in a nostalgic mood.

Consumers are also, we know, more prone to buying stuff when it hasn’t been available in quite some time, and when we get the idea it may disappear again because it’s a limited-time offer. The periodic resurfacing of the McDonald’s McRib is a great example of how this strategy can work over and over to successfully drum up sales—for a product that, remember, was discontinued from the regular menu because not enough people liked it.

These varied forces have combined to fuel a surge in sales for products ranging from cheap old-school beer (featuring retro bottles, cans, and logos) to re-releases of old-school sneakers, Nike Air Jordans in particular. And these forces are also fueling a surge in discontinued food and drink products being brought back from the dead, including, well, SURGE.

The highly caffeinated citrus soda brand was brought back by Coca-Cola this week due to popular demand. The masses spoke in the form of a Facebook page with more than 140,000 Likes that demanded its return to the marketplace. And then they took action by buying up the first batch in its entirety within hours of it going on sale at Amazon.com.

Here are a few other food and drink products that disappeared for a while, only to resurface to the rejoicing of more than a few cult fans.

Hostess Chocodiles
At one point, sellers on eBay were asking as much as $90 a box for these chocolate-covered Twinkie treats, and buyers paid $17 for a single Chocodile. That was back during the dark days, when Chocodiles weren’t available in the vast majority of the country. In July Hostess announced it was bringing the Chocodile back nationally, by way of some hyperbolic statements from the company’s CEO. “In the past Chocodiles seemed to be shrouded as much in mystery as in chocolate, inspiring an obsession among fans that was truly the stuff of legends,” said William Toler, president and CEO of Hostess Brands. “Now, fanatics will once again be able to satisfy their cravings and a new generation will be able to experience the magic for the first time.”

BK Chicken Fries
Over the summer, around the same time Burger King was dramatically scaling back availability of Satisfries, its low-calorie French fry, the fast food giant brought back decidedly less healthy Chicken Fries to the menu for a limited time. The breaded-and-fried chicken strips were on the menu from 2005 until they were discontinued in 2012. But after online petitions and Tumblr pages pleaded for their return, BK relented. “On peak days we’ve seen one tweet every forty seconds about Chicken Fries, many of them directly petitioning, begging, for us to bring them back,” Eric Hirschhorn, Burger King’s Chief Marketing Officer North America, said in a statement. “When you have guests who are this passionate about a product, you have to give them what they want.”

Ballantine IPA
The hipster cult status of PBR has caused the Pabst Brewing Company to take a hard look at the beer brands it owns and see if should start brewing any of its discontinued old-school beers—which, perhaps, might also gain a following with hipsters. That’s essentially why Pabst relaunched Schlitz in 2008, and then reintroduced Schlitz vintage “Tall Boy” can a few years later. And it’s why the company is bringing back Ballantine IPA, the 136-year-old brew produced for decades in Newark, N.J., credited as America’s first IPA. It helps that the craft beer revolution has made hoppy IPAs extremely popular.

General Mills Monster Cereals
For most of the year, shoppers can’t find Boo Berry, Count Chocula, and Franken Berry in the cereal aisles of any supermarkets. But then sometime in late summer, their dormancy period ends like that of a pumpkin spice latte, and they’re suddenly available again just in time for the ramp-up to Halloween. This year, the cereals feature new designs from DC Comics artists, being sold side by side next to cereal boxes with retro characters and logos from the 1970s and ’80s. Count Chocula and Franken Berry are also being sold in select stores in Canada this season, which is unusual. “No more trips across the U.S. border to stock up!,” a General Mills post promised.

Last year, General Mills made monster cereal fans extra happy by bringing back two rare products, Frute Brute and Fruity Yummy Mummy, which hadn’t been sold in more than two decades. Alas, it looks like the two cult favorites are not returning to stores this season, prompting fans to voice their disappointment with comments on the company blog.

Something tells us we’ll be seeing both Frute Brute and Fruity Yummy Mummy again in the future. In today’s nostalgia-ridden world, no brands really die, not even when they feature monster characters that are undead.

TIME NFL

Vikings Owner Says ‘We Made a Mistake’ With Adrian Peterson

Minnesota Viking v Tennessee Titans
Running back Adrian Peterson of the Minnesota Vikings looks on during a preseason game against the Tennessee Titans at LP Field on Aug. 28, 2014 in Nashville. Ronald C. Modra—Sports Imagery/Getty Images

As Nike drops its endorsement deal with the star

Minnesota Vikings owner Zygi Wilf said Wednesday that the team had “made a mistake” in its initial decision to allow Adrian Peterson back onto the field as the star running back was being investigated for allegedly abusing his four-year-old son. The team said Peterson is now banned from all team activities until his legal problems are resolved, the Associated Press reports.

“We made a mistake and we need to get this right,” Wilf said. “It is important to always listen to our fans and the community and our sponsors. Our goal is always to make the decision we feel is right for the Minnesota Vikings … We want to be sure we get this right.”

The reversal came as a growing number of sponsors severed ties with Peterson, with Nike joining the pack in dropping its endorsement contract with Peterson on Wednesday.

“NIKE in no way condones child abuse or domestic violence of any kind and has shared our concerns with the NFL,” the company told ESPN.

[AP]

TIME marketing

Why (Most) Sponsors Aren’t Pulling Out of the NFL

Ray Rice
Baltimore Ravens running back Ray Rice pauses as he speaks during an NFL football news conference, Friday, May 23, 2014, in Owings Mills, Md. Patrick Semansky—AP

Radisson suspended their Vikings sponsorships, but they may be the only brand to go that far

When Vikings general manager Rick Spielman announced yesterday, in front of a backdrop splashed with the Radisson logo, that Adrian Peterson would play Sunday despite serious allegations of child abuse, the hotel chain suspended its sponsorship of the NFL team.

But it appears that Radisson’s withdrawal has not opened the floodgates for other sponsors to drop their NFL contracts. Covergirl announced late Monday night that it would not stop being the “Official Beauty Sponsor of the NFL,” despite a viral meme that showed a Covergirl model sporting a black eye while wearing a Ravens jersey. “In light of recent events, we have encouraged the NFL to take swift action on their path forward to address the issue of domestic violence,” Covergirl said in a statement.

Anheuser-Busch, official beer sponsor of the NFL, released a statement Tuesday condemning the response to the abuse scandals, but did not pull their sponsorship. “We are disappointed and increasingly concerned by the recent incidents that have overshadowed this NFL season,” they said. “We are not yet satisfied with the league’s handling of behaviors that so clearly go against our own company culture and moral code.”

But despite the finger-wagging, PR experts say it’s unlikely that major NFL sponsors like Verizon and PepsiCo would pull their sponsorship in light of the recent abuse scandals. “You didn’t see people immediately jumping ship—they’ve made multimillion investments in this,” says Joe Favorito, a sports media consultant who teaches strategic communications at Columbia University and once served as head of PR for the New York Knicks. “I don’t think that the massive brands that are tied to the NFL are in the blind on anything.”

“Everybody these days wants immediate results and immediate reactions,” he says. “Most brands will take their time, especially since most of them have very positive and lucrative experiences with the NFL, and then will act accordingly.” He noted that FedEx hasn’t pulled their sponsorship of the Redskins despite the controversy over their name, and Under Armor is still sponsoring the Ravens despite Ray Rice’s abuse scandal.

So why was Radisson the only brand to suspend their sponsorship? Ray Katz, executive VP for sports marketing at Source Communications and adjunct professor of sports marketing at Columbia University says he suspects Radisson probably had a pretty minor contract compared to the big deals like Verizon and Gatorade, whose sponsorships are more “organic” because they tie in more naturally with sports broadcasts.

“Radisson is not and has not been a very broad corporate sponsor,” Katz says. “To me, this is essentially an excuse to get out of that sponsorship. The benefit of taking an alleged moral high ground is a way bigger benefit than the sponsorship.” Katz serves on the board of Sherwood Trading Group, which helps companies get out of corporate sponsorships, and is not in any way affiliated with Radisson.

Katz also noted that Nike and Castrol have not yet pulled their sponsorship of Adrian Peterson, and the accused child abuser was spotted wearing Nike on Tuesday morning.

“Why should the Vikings cut somebody based on allegations?” Katz said. “The Bears or the Packers will pick him up. The NFL didn’t say Adrian Peterson couldn’t play football.”

TIME Innovation

Five Best Ideas of the Day: September 15

1. Relief organizations today are dangerously politicized and risk irrelevancy. To survive, they must evolve into decentralized networks for sharing knowledge, aid, and true humanity.

By Paul Currion in Aeon

2. There is more to measuring economic strength than jobs. For manufacturing, America is one of the most cost-competitive countries in the industrial world.

By Harold L. Sirkin, Michael Zinser, and Justin Rose in BCG Perspectives

3. Could a secret online marketplace for illegal drugs provide a safer alternative to our modern drug war?

By Colin Moore in Substance

4. Marketing to so-called “influencers” is a waste of advertising dollars.

By Greg Satell in Harvard Business Review

5. Technology vs. Tradition: Menstrupedia tackles taboos in India to improve women’s health and lives.

By Priti Salian in TakePart

The Aspen Institute is an educational and policy studies organization based in Washington, D.C.

TIME marketing

Coca-Cola Is Bringing Back SURGE

Coke dials up the 1990s nostalgia

Coca-Cola’s 1990s SURGE citrus drink is back by popular demand.

The Mountain-Dew inspired soda, which debuted in 1996 but was discontinued in the early 2000s, has been the subject of a nostalgia-fueled online campaign to lobby the company to bring back the drink.

A Facebook group devoted to SURGE has over 129,000 likes, and Coca-Cola said in a statement that they’ve decided to re-issue the drink thanks to “a passionate and persistent community of brand loyalists who have been lobbying The Coca-Cola Company to bring back their favorite drink over the last few years.”

SURGE will be sold on Amazon.com, which represents the first time a Coca-Cola product has been sold exclusively through an online retailer. SURGE’s relaunch will also be an experiment in social media marketing for the brand, since they said they will not invest in any traditional marketing for this product.

MONEY health

How the Flu Shot Became the New Doorbuster Deal

Flu Shots
Yagi Studio—Getty Images

Pharmacies are using coupons and early season promotions in an aggressive competition to give flu shots to more Americans. The hope is that these efforts give their overall sales a shot in the arm.

Take a look at any chain pharmacy in your neck of the woods, and odds are it’ll be advertising special deals on flu shots. The trade publication Supermarket News recently rounded up a list of promotions showing that retailers are getting “creative” to encourage more customers to get flu shots. CVS promises shoppers that they’ll get a free flu shot (with most insurance plans), as well as a “shopping pass” valid for 20% off non-sale merchandise on the day you’re vaccinated. Safeway knocks a flat 10% off your grocery bill when you come in to get a flu shot. Target is waving a deal of 5% off your total purchase on the day you get a flu shot, which can range in (retail) price from $24.99 to $49.99. Get vaccinated at a Giant Food store and you’ll be rewarded with a coupon book good for savings of more than $30.

What’s more, just as retailers are constantly expanding the Christmas season with promotions and ads that start earlier and earlier every year, pharmacies are trying to beat the competition to the punch by pushing flu shots long before flu season is on the radar of consumers. Walgreens, which is utilizing a “Get a Shot. Give a Shot.” marketing campaign to win over consumers’ flu shot business—money raised helps poor children around the world get vaccinated—announced back on August 19 that all of its stores, health care clinics, and Duane Reade locations (which it also owns) were armed and ready to administer flu shots. Rite Aid actually beat Walgreens by a week, informing customers that flu shots were available at all of its stores starting on August 12, more than two weeks before Labor Day weekend.

There’s certainly nothing wrong with stores encouraging Americans to protect their health by getting flu shots. The CDC recommends annual flu vaccinations for almost everyone ages 6 months and up.

Yet it still seems fair to question the motivation of the flu shot peddlars. You don’t have to be a cynic to see that retailers promote flu vaccinations and other health-minded initiatives at least partly out of self-interest. When CVS stopped selling tobacco products, it was regarded first and foremost as a win for the health of all Americans, but it has also come to be seen as a savvy business move that’s helped the drugstore chain stand out from competitors in the marketplace and boosted the company’s stock price significantly.

With that in mind, it’s worth noting that flu vaccinations are very profitable for drug makers and drugstores alike. Sales are increasing rapidly in the age of Obamacare and increased coverage too. Forbes reported in 2013 that the number of flu shots administered by CVS had more than doubled the previous year. For the first quarter of 2014, immunizations at Walgreens were up 34% compared to the previous year. In early September, Meijer Pharmacy announced that it expects to administer 30% more flu shots this season compared to a year ago.

An increase in flu shots means an increase in shoppers, who are especially likely to browse the aisles and buy stuff when they’re given a coupon for discounted merchandise that day. So in a way, flu shots are not unlike loss leaders or Black Friday doorbuster deals: They’re handy for helping retailers to draw loads of customers inside stores. Only with flu shots, pharmacies aren’t losing money each time one is sold, which is often the case with deeply discounted “doorbusters.” Drugstores must also like establishing the idea in the minds of consumers that a store that’s good for vaccinations is also probably a solid go-to resource for nearly all of the customer’s health needs, preventive care in particular.

Varying advice on when flu shots should be administered may raise some eyebrows as well. No one gets more than one flu shot (at least not on purpose), so there’s a natural incentive for pharmacies to try to get their needles into the shoulders of shoppers before the competition does. But is getting a flu shot while it’s still summer a good idea?

Rite Aid certainly thinks so. “Getting a flu shot as soon as it is available is the single best way to protect yourself and others against the flu,” Robert I. Thompson, Rite Aid executive vice president of pharmacy, said in a press release.

“The best time to get a flu shot is not October, but actually before or soon after school starts,” Meijer Drug Store Vice President Nat Love said in a statement. “Once classes begin, kids can literally bring viruses into your home every day, and it becomes difficult to keep influenza from spreading throughout the whole family. There is no expiration date to receiving a flu shot, so the sooner you get your flu shot, the better chance you have of staying healthy.”

As for the CDC, its recommendations for timing are as follows: “Vaccination optimally should occur before onset of influenza activity in the community. Health care providers should offer vaccination soon after vaccine becomes available (by October, if possible). Vaccination should be offered as long as influenza viruses are circulating.”

That would seem to settle that. Only it doesn’t because not everyone is on the same page. Dr. Mark Dowell, an infectious disease doctor at Rocky Mountain Infectious Diseases, recently told the Casper Journal (Wyoming) that because a flu shot’s efficacy starts wearing off as early as four months after being injected (perhaps sooner if you’re over 65), you could be asking for trouble by electing to being vaccinated before October 1. “If you get your flu shot too early,” Dr. Dowell said, “you may run out of protection before the peak flu season hits in Wyoming.”

It also seems worth pointing out that, at times, marketers seem guilty of stretching the truth in order to give customers the hard sell on flu vaccinations. “Following a second straight severe flu season in the U.S., and one which impacted younger adults in particular with increased hospitalizations, health officials are encouraging early vaccination to help protect against influenza this season,” a Walgreens statement released in August explained. Indeed, the CDC verifies that the flu hit young people particularly badly in 2014. But overall, it was not a “severe flu season” like Walgreens suggests. In fact, despite the brutally cold winter, cough and flu medicine sales from giants like Procter & Gamble were weak, indicating fewer people were sick.

And, ostensibly, a big reason fewer people were sick is … because they’d gotten flu shots!

So go on and get your flu shot. But go in with your eyes wide open, understanding how the game is played.

MONEY Family

Walmart Swears Your Kids Want This New Smartwatch for Christmas

Vtech Kidizoom Smartwatch
VTech Kidizoom Smartwatch courtesy of VTech

Parents: Don't have a heart attack. It's not the Apple Watch kids are supposedly demanding.

Well, at least not yet. But that may only be because the freshly introduced Apple Watch isn’t on sale until early 2015.

Though critics have voiced plenty of concerns about the new Apple Watch—you still need a phone to use it, battery life is limited—the assumption is that young people especially will be eager to strap on the fancy, futuristic new gizmo and see what it can do. This, in turn, has caused some to rally parents to put up a united front and just say no to kids having Apple Watches, which will sell at retail for a hefty $350 after all.

Lots of kids will have smartwatches anyway—and they’ll get them even before their parents are noodling around excitedly to see what their own Apple Watches can do. According to Wal-Mart, which just released its “Kid-Approved Holiday Toy List,” one of the top gifts young children crave under the tree come December 25 is something of a knockoff of Apple’s hot new gadget. The VTech Kidizoom Smartwatch just entered the marketplace, and after consulting hundreds of children, Wal-Mart claims that it will be one of the hottest toys of the season. VTech lists the product as best for kids ages 4 to 7, and it sells for the comparatively low price of $60.

What does VTech’s Smartwatch do? Mostly, it takes photos and video and can be used for a few games. It has a touch screen, and, yes, it has a clock (50+ different designs) with an alarm and a timer. It doesn’t have Siri or the ability to track your heart rate or communicate with others, so there shouldn’t be any confusing this watch with the Apple offering.

Early reviewers of the device—many of them mommy bloggers who say upfront that they were given one free to test and write about—rave about it, for the most part. A PCMag.com review rated the Kidizoom at four out of five stars, with strong marks given because it’s easy and fun and takes decent videos and photos, but it loses a few points because of limited memory (a few minutes of video and you’re tapped out) and battery life that didn’t live up to what’s promised.

Yet all things considered, there’s good reason to be a little skeptical that kids will make this one of the hottest toys of the season. And if it does wind up being a hot holiday gift, who knows how long this device will actually hold a child’s interest?

Then again, who knows about any of this? A few years back, there was plenty of skepticism about the idea of buying tablets for kids, but before you knew it gadgets like the Leapfrog LeapPad tablet were in high demand around the holidays.

Bear all of this in mind when determining whether or not to purchase the supposedly “Kid-Approved” new smartwatch as a holiday gift. And if you do buy one, good luck convincing your kid that the VTech smartwatch is just as good as Apple’s when its smartwatch goes on sale to the public a few weeks after Christmas.

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What Has the World Come to When Dunkin’ Goes Dark and Guinness Goes Light?

Guinness Blonde
courtesy of Diageo

Guinness, Starbucks, Wal-Mart, and Dunkin' Donuts are trying to win over new customers by taking a sharp break from their core mission. They should be worried about alienating their core customers in the process.

Everywhere you look, it seems, there’s a major brand introducing a new product, service, or store model that’s more or less the opposite of what the company is best known for. Taco Bell, famous for cheap, indulgent, down-and-dirty Mexican food, is trying to woo foodies with an upscale “premium” taco restaurant. Starbucks, which became a phenomenon for its personalized, barista-made (and slow) approach to rich, dark caffeinated beverages, recently announced plans for a series of small express stores where the focus will be on speedy takeout rather than the laid-back café experience. JetBlue, born with the principle that all passengers should get the same high-quality service, introduced a VIP business class called “Mint” over the summer. Wal-Mart, the blue-collar favorite that has always focused first and foremost on cheap prices, has dramatically expanded into a realm normally considered the domain of elites and picky foodies: organic foods.

And now Dunkin’ Donuts, a stalwart purveyor of light, sweet, mainstream coffee, is introducing a dark roast blend, while also playing up to niche dieters by adding almond milk to the menu. Meanwhile, the rich, dark, iconic Irish stout Guinness is going in the other direction with a light new Blonde American Lager.

For some, Guinness’s move is tantamount to sacrilege—if not for selling out its Irish roots with a beer for the “American” audience (that’s made in the U.S. too), then for producing the lighter beer itself, which few have tasted but some have compared to Bud Light—in certain respects anyway.

Why are Guinness and these other brands risking the possibility of alienating their core customers? What’s behind this trend of straying in the opposite direction from what made these companies successful to begin with? Do these moves represent a smart expansion of the brand or an identity crisis? The answers largely depend on whether consumers deem the new products and services as brilliant and appealing or as puzzling, weird, and perhaps even desperate.

Dr. Edward Tauber, who coined the term “brand extension” in 1979, told AdWeek that the best brand extenders have three things in common: “The brand should be a logical fit with the parent brand; the parent should give the extension an edge in the new category; and the extension should have the potential to generate significant sales.”

Some might argue that the efforts mentioned above aren’t logical expansions for the parent company. They may even turn off some regular customers. But expanding a brand in the opposite direction—while remaining in the same product category—is a lot more logical than heading off in some random, nonsensical fashion. You may not be keen on Guinness’s brand being applied to a light beer for Americans, but at least pale lagers and dark stouts are both beer. When Heineken introduced a brand of shoes, AdWeek voters listed it among the worst brand extensions of 2013.

When Dunkin’ Donuts announced the addition of a dark roast, the reaction was more It’s about time than What in the world are they thinking? “We saw an unmet demand for a dark roast product that had a bold flavor but a smoothness that’s often associated with Dunkin’ Original Blend,” John Costello, Dunkin’ Brands’ president of global marketing and innovation, quite logically explained to the Wall Street Journal regarding DD’s new dark roast.

Today’s executives aren’t satisfied simply by reaching a large group of customers with a stable set of tried-but-true products and services. In our fast-moving, constantly changing marketplace, brands feel compelled to hunt, relentlessly and shark-like, for the business of every consumer, at every opportunity.

For decades, the majority of fast food chains were content to do the vast majority of their business during the lunch and dinner hours. Then someone realized that formula was writing off plenty of hours of the day in terms of sales potential. Hence, the increased marketing of fast food “snacks,” meant to be consumed in the odd “day parts” in between normal meal breaks, as well as late-night specials and a huge push for breakfast

Similarly, a few years back Starbucks realized that it was overlooking a huge market by sticking exclusively with darker roasts—40% of coffee drinkers prefer lighter, milder roasts—so the Blonde roast was introduced to fuel growth among folks who otherwise wouldn’t be Starbucks customers. Thanks partly to its ability to expand the customer base, Starbucks seems to be winning the coffee wars, with same-store sales growth that’s surpassed competitors like Dunkin’ Donuts.

Wal-Mart’s organic foods push is an indication that the world’s largest retailer had gotten tired of allowing Whole Foods to dominate the space. The expansion into healthier foods wouldn’t seem to be all that controversial—Wal-Mart promised shoppers that they’d save 25% or more compared to similar products—yet even this move is not without risk. During the mid-’00s and beyond, Walmart was criticized for betraying blue-collar shoppers by raising prices and getting rid of “rollback” specials in an attempt to keep pace with Target and other, more upscale competitors. What’s more, there’s a significant portion of consumers who aren’t fans of organic foods. According to a recent Gallup poll, 15% of Americans say they “actively try to avoid” organic foods. Why? Perhaps because they assume such foods cost more or don’t taste good. And it’s safe to assume folks who feel this way are far more likely to shop at Wal-Mart than at Whole Foods.

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