Source: http://blog.compete.com/2011/07/21/the-new-music-landscape/

It’s no secret that the music industry has undergone massive changes over the last ten to fifteen years. According to the Recording Industry Association of America, total US music sales have dropped an average of 8% each year since 1999, from $14.6 billion to just over $6 billion. Having heard this, you probably wouldn’t expect that in the first half of 2011, US sales are up by 1%. Okay, so it’s just 1%. But consider that in the first half of 2010, sales were down 11% year-over-year.

So what’s responsible for reversing this trend? Ever-increasing broadband speed has enabled mass media consumption on the web, paving the way for music discovery services like Pandora, Last.fm, Grooveshark and iLike. Because of these services, the average person can now find and listen to a more diverse body of music than ever before – and it’s catching on. Unique visitors to radio category websites has increased by nearly 19% since last year, with Pandora leading the pack at 11,824,629 in June 2011 – that’s 81% yearly growth.

Over the last few years, Pandora has made decisions to support growth of their user base and help them stay ahead of the competition, even if just barely at times. In 2008, the Pandora app became one of the most consistently downloaded apps in the Apple store. By 2010, Pandora was present on more than 200 connected consumer electronic devices ranging from smart-phones to TVs to Blue-ray players. It was in 2010 that Pandora began to break away from the other music discovery services and would attract more than double the unique visitors of Last.fm, traditionally Pandora’s toughest competitor, by year-end.

In February 2011, Pandora officially filed with the SEC for a $100M IPO, piquing even more interest in the service in the months leading up to their pricing announcement on June 15th. The company’s future may not be as bright though, as innovative alternatives to radio-style listening like Spotify, Music Beta by Google and Apple’s iCloud are beginning to gain traction. While these services are very different than Pandora – and from each other – there is no doubt that they pose a threat to the current music landscape. You can be sure we’re keeping an eye on it.

So, have you tried Spotify? Music Beta? iCloud? What do you think? Are you ready to abandon Pandora?

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Source: http://blog.compete.com/2011/07/15/scion-seeks-soul-and-souls/

The Scion brand was among the first “alternative” automotive youth brands in the US.   Highest-ever monthly sales were 19,252 units in August 2006, but Scion may have lost its soul since.  In 2010 (before any earthquake-related shortages), sales averaged 3,800 units a month.  Compete assessed key drivers of Scion sales (shoppers and conversion) to help reveal the drivers of Scion’s off-pace results, and fielded a survey on consumer perceptions of Scion.

Missing the Shopper Recovery

The number of unique Scion shoppers at the brand level has trended down over the past 30 months.  (Unique means shoppers of more than one Scion model are counted only once at the brand level).  Fewer shoppers in 2009 could be related to the recession, which impacted everyone.  Through the first half of 2009, Scion’s Share of Market Interest (SMI) was fairly steady, meaning its shopper volumes tracked with the market.  But as market shopper volume has recovered since then, Scion’s has not: its SMI was near a period low in June 2011.  Keep in mind that vehicle shortages impact sales, not shopping.

Scion More Quirky than Youthful?

To shed light on possible reasons for Scion’s SMI decline, Compete fielded a digital general population survey in June on consumer perceptions of the brand.  Over 60% felt they did not know enough about Scion to have an opinion.  Of the 39% that offered an opinion, “quirky” and “economical” led results.  In a recession, “economical” would seem to help shopping and sales; perhaps “quirky” is overpowering “economical.” “Youthful” was a distant third, potentially leaving Scion with a market hinging on quirky but economical products not quite geared toward younger buyers.

Scion Soul in Context

Kia’s Soul was one of the models that followed in Scion’s footsteps.   It has distinctive styling in the boxy genre and a low base price, and its advertising has argualbly been youth-oriented.  For context, Compete compared shopper volume for Soul against Scion overall.  The volumes are surprisingly similar (meaning that Soul alone has about the same number of shoppers as Scion overall).   The strength of Soul may mean that some would-be Scion shoppers instead shopped Soul, or may have shopped Soul in addition to Scion.

Showdown in the Showroom

Despite similar shopper volumes, Soul monthly sales have averaged 37% higher than Scion’s, and have exceed 10,000 units in each of the past four months; Scion averaged 4,850 in the same period.   So while Scion and Soul each had the same potential for sales, Kia has been more effective at converting Soul shoppers into Soul buyers.  Soul conversion has better Scion’s in all months but one since February 2010.

Scion Redemption

The good news is that Scion today has the potential to sell more vehicles, based on current shopper volumes (or souls).  The bad news is that it has lost shoppers over time in absolute terms and relative to the market, and its ability to convert shoppers into buyers trails potential rivals, like Soul.

Of course there’s more to the story.  Logical next steps Scion can investigate to restore sales include the following.  These same steps can be used by others looking to launch Scion-compatible products to better understand Scion’s trajectory to date:

  • Understand why the market’s shopper growth is not reaching Scion
    • Ad effectiveness: Compare SMI to share of voice: coincident drops in both may simply mean Scion was outspent.
    • Avoiders: Field a shopper avoider study to in-market consumers of Scion rivals that are not shopping Scion and ask why (lack of awareness, lack of familiarity, etc.).
    • Spillover demand: Quantify reverse-cross-shop trends to reveal which rivals’ shoppers are cross-shopping Scion and which are not and how that has changed over time.
  • Understand Scion conversion inhibitors
    • Benchmarking: Compare Scion conversion trends by model against target rivals.
    • Influences: Evaluate conversion relative to core conversion influencers, such as inventory levels, incentives, and other conversion influencers.
    • Rival refinement: Evaluate Scion cross-shop data to help reveal the extent to which Scion’s actual rivals are not target rivals, and the extent to which conversion by target or true rivals is impacting Scion conversion.

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Source: http://www.businessinsider.com/chart-of-the-day-googles-headcount-2011-7

Last night Google reported strong earnings with big revenue growth. It also reported that headcount is still soaring upwards, a trend that started a year and half ago. Below we’ve charted Google’s growing headcount, and its flattening revenue per employee.

chart of the day, google employees, revenue, july 2011

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Source: http://blog.compete.com/2011/06/30/summer-cinema-smash-or-site-traffic-stinker/

movie theatre marquee

36 years ago, Stephen Spielberg released Jaws during a traditionally quiet time of the year for the box office. It took in seven million dollars that opening weekend, and became the highest grossing film of all time until Star Wars debuted two years later. What followed was a new era of Hollywood, a period in which the summer quarter would account for 40 percent of the entire year’s box office earnings.

It also began the era of extreme (read: shameless) Hollywood marketing. On May 6, 2011 Thor was released, grossing 65 million dollars in its first weekend, and going on to earn more than 430 million dollars worldwide. We’re now deep into the summer blockbuster season.

So it got me wondering: are major studios using their mega movies to drive traffic to their websites?

uvs to major movie studios

Over the last two years, it looks like they’ve rarely gotten more than a million unique visitors in a month, with one glaring exception: Warner Brothers, which consistently gets over 2 million UVs a month. Half-Blood Prince was the second highest grossing film of 2009 behind movie mammoth Avatar, and Sherlock Holmes was at number 8. Because these films were driving WB’s traffic up so much, why weren’t other studios benefiting from their movies’ hype? Avatar is the highest grossing film of all time, but it did nothing for Fox’s UVs in December 2009. I realized that unlike WB, other studios don’t host their movies on subdomains—they set up new sites specifically for each movie.

So how do these sites stack up? Here are five of the six top grossing movies domestically this year. Each has a significant spike in daily reach right around their release date.

daily reach for summer movie sites

After just a few days, though, the sites become almost obsolete. Even The Hangover Part II, WB’s subdomain, falls to almost nothing. So then what is it keeping Warner Bros. at the top of the internet game? If it’s not blockbusters bringing in hundreds of millions, what is it?

uvs to warner brothers sites

Ellen DeGeneres’ show seems to drive about half of Warner Bros’ traffic.

I guess daytime TV is a blockbuster, too.

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Source: http://blog.compete.com/2011/06/30/summer-cinema-smash-or-site-traffic-stinker/

movie theatre marquee

36 years ago, Stephen Spielberg released Jaws during a traditionally quiet time of the year for the box office. It took in seven million dollars that opening weekend, and became the highest grossing film of all time until Star Wars debuted two years later. What followed was a new era of Hollywood, a period in which the summer quarter would account for 40 percent of the entire year’s box office earnings.

It also began the era of extreme (read: shameless) Hollywood marketing. On May 6, 2011 Thor was released, grossing 65 million dollars in its first weekend, and going on to earn more than 430 million dollars worldwide. We’re now deep into the summer blockbuster season.

So it got me wondering: are major studios using their mega movies to drive traffic to their websites?

uvs to major movie studios

Over the last two years, it looks like they’ve rarely gotten more than a million unique visitors in a month, with one glaring exception: Warner Brothers, which consistently gets over 2 million UVs a month. Half-Blood Prince was the second highest grossing film of 2009 behind movie mammoth Avatar, and Sherlock Holmes was at number 8. Because these films were driving WB’s traffic up so much, why weren’t other studios benefiting from their movies’ hype? Avatar is the highest grossing film of all time, but it did nothing for Fox’s UVs in December 2009. I realized that unlike WB, other studios don’t host their movies on subdomains—they set up new sites specifically for each movie.

So how do these sites stack up? Here are five of the six top grossing movies domestically this year. Each has a significant spike in daily reach right around their release date.

daily reach for summer movie sites

After just a few days, though, the sites become almost obsolete. Even The Hangover Part II, WB’s subdomain, falls to almost nothing. So then what is it keeping Warner Bros. at the top of the internet game? If it’s not blockbusters bringing in hundreds of millions, what is it?

uvs to warner brothers sites

Ellen DeGeneres’ show seems to drive about half of Warner Bros’ traffic.

I guess daytime TV is a blockbuster, too.

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Source: http://www.businessinsider.com/chart-of-the-day-apple-revenue-by-segment-2011-4

Apple’s iPhone has gone from zero to half of Apple’s revenue in less than 4 years.

Apple reported $12.3 billion in iPhone sales last quarter, half of its overall revenue, and up 126% year-over-year.

For the first time ever, iPhone revenue didn’t shrink in the March quarter after the busy Christmas quarter before it. (Thanks in large part to launching at Verizon Wireless and SK Telecom during the quarter.)

And if you include iPod touch and iPad sales, Apple now gets about two-thirds of its revenue from iOS devices — a platform that didn’t exist 4 years ago.

But again, what’s most remarkable is how fast Apple is still growing overall as a company. At $24.7 billion in sales last quarter, Apple grew 83% year-over-year. That’s even faster than its 71% year-over-year growth during the Christmas quarter before it. Amazing.

SAI chart Apple revenue by segment March 2011

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Source: http://www.businessinsider.com/chart-of-the-day-demand-media-2011-4

Investors have been fleeing Demand Media since April 6th, as shown in this chart from Yahoo Finance.

April 6 is right around when Google implemented its latest search algorithm tweak, which has hammered Demand Media’s sites according to Hitwise data given to Forbes, as well as earlier data from SEO firm Sistrix.

Demand admitted its traffic had fallen off, but said it would still hit its stated financial goals. Obviously that wasn’t enough assure spooked investors.

demand media chart

Follow the Chart Of The Day on Twitter: @chartoftheday

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