profit

This is why Google’s profit margins are going down

They sent me a 4-fold mailer to tell me that I got 167 visitors from my Adwords campaign in September and suggestions for how to make improvements.

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Monday, November 5th, 2012 news No Comments

Facebook’s Revenue Deceleration Is Over! (FB)

Source: http://www.businessinsider.com/chart-of-the-day-facebook-revenue-2012-10

The reason Facebook tanked after its IPO is that revenue growth decelerated for the past several quarters. 

That’s not good for a story with Facebook’s revenue and profit multiples. It needs to be growing very fast.

So it was very good news for Facebook today, when it reported earnings that showed the company has finally stabilized revenue growth – 32% last quarter and 32% this quarter. You can see this in the chart below.

What this chart doesn’t show is the even better news that Facebook has actually re-accelerated its advertising revenues – up to 32% y/y this quarter from 28% y/y last quarter.

chart of the day, facebook revenue growth, oct 2012

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Tuesday, October 23rd, 2012 news No Comments

Facebook Just Launched ANOTHER New Revenue Stream, Goes After Groupon (FB)

Source: http://www.businessinsider.com/facebook-offers-ads-are-no-longer-free-2012-9

mark zuckerberg, disrupt 2012,

Facebook Inc said it will start charging businesses to run Offers on its social network, turning a previously free service into a potential revenue generator at a time when Wall Street is demanding new sources of growth and profit from the company.

Facebook launched Facebook Offers earlier this year, letting retailers and other local merchants send deals to their Facebook fans.

Users claim the offers from their News Feeds and redeem the vouchers at stores to get discounts.

The service has been free, but in coming weeks Facebook will require merchants to pay at least $5 on related ads to promote each Facebook Offer to a targeted audience of fans and friends of fans. The cost will vary based on the size of a company’s Facebook pages.

Since Facebook went public in May, the company has been under pressure from Wall Street to show how it can turn its giant social network into a money machine. Facebook shares have lost about 40 percent of their value since the IPO.

The commerce potential of Facebook, known as f-commerce, has yet to materialize, partly because retailers have been able to feast on a host of free tools on the social network to attract customers.

Tying Facebook Offers to a paid ad service suggests the company is working to change this.

“We think this aligns incentives nicely,” said Gokul Rajaram, director of product management for Facebook’s advertising and Pages businesses. “The best results on Facebook Offers will come from organic distribution plus paid distribution.”

In the past, some Facebook Offers have not been relevant to all users, partly because some people saw deals in their News Feeds from merchants located far away from where they live, Rajaram ad! ded.

“The requirement to pay for related ads will focus merchants on who and where they want the offer to reach,” he said.

Facebook is also expanding Offers to online-only businesses, he added. Before, the service was available only to merchants with physical locations.

Facebook is also adding barcodes for offers, so customers can redeem offers more easily. The barcodes work globally, Rajaram noted.

The executive declined to disclose how many Facebook Offers have been run so far, how many merchants have taken part, or how many deals have been claimed and redeemed by consumers.

However, he said Facebook is “very happy” with the success of its Offers business.

“That’s why we’re expanding and investing more in it,” Rajaram said.

(Reporting by Alistair Barr and Alexei Oreskovic; Editing by Phil Berlowitz)

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Thursday, September 20th, 2012 news No Comments

The Astounding Growth Of iPhone Profits (AAPL)

Source: http://www.businessinsider.com/chart-of-the-day-apples-gross-profit-per-product-2012-8

Make no mistake about it, Apple is now the iPhone company.

This chart, based on information from Apple and estimates from our own Henry Blodget, shows how gross profit from the iPhone has exploded since it was introduced in 2007. It basically overshadows profits from all other divisions at Apple.

Blodget estimates gross profits will be $67 billion in 2014, up from an estimated $44 billion this year.

Apple profits per product

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Friday, August 3rd, 2012 news No Comments

PepsiCo Discovers Consumers Will Pay More For Orange Juice With Less Juice (PEP)

Source: http://www.businessinsider.com/pepscico-discovers-consumers-will-pay-more-for-watered-down-orange-juice-2012-2


tropicana carton redesignThis post originally appeared at Newser

PepsiCo’s plan to increase profit margins for its Tropicana orange juice is simple: Just add water. Apparently some consumers are already doing that on their own, in order to get a less-thick or lower-calorie beverage. “They themselves add water before drinking OJ,” a PepsiCo exec tells Bloomberg. “So why not add the water ourselves and charge for it?” Tropicana lost market share to Coca-Cola Co.’s Minute Maid and Simply Orange brands after PepsiCo repackaged its juice three years ago.

Now, instead of continuing to compete in the 100% juice category, PepsiCo will focus on different products with higher profit margins. One such product—Trop50, which contains 42% orange juice and uses a low-calorie stevia-based sweetener—has already been successful. Says the exec, “We have lost perspective here on the primary reason we are in business, which is to make money.” Consumers will always know what they’re getting, thanks to strict FDA juice labeling guidelines.

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Wednesday, February 15th, 2012 news No Comments

Groupon’s Growth Bounces Back (GRPN)

Source: http://www.businessinsider.com/chart-of-the-day-groupons-growth-bounces-back-2012-2

Groupon’s sequential growth had been screeching to a halt, but the company managed to bounce back a little in the fourth quarter. That’s good news. Even better news, which is not shown here, the company  turned an operating profit.

chart of the day, groupon, quarter over quarter growth. feb 9 2012

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Thursday, February 9th, 2012 news No Comments

Hospitals Are Using Confidential Medical Records To Target High-Paying Patients

Source: http://www.businessinsider.com/hospitals-are-using-confidential-medical-records-to-target-high-paying-patients-2012-2


skin-cancer-screening

Hospitals are increasingly milling their patients’ confidential medical records to target their promotional mailings for services, reported Phil Galewitz of USA Today.

It’s not illegal, but the practice doesn’t sit well with consumer advocacy groups who point out that many health care providers are choosing to ping patients with better insurance coverage.

That creates a sort of indirect discrimination, as hospitals make it harder for consumers with less insurance to learn about services they may very well need.

To target the ads, hospitals determine the likelihood that patients would need certain services based on age, income and insurance status. Hospitals have said they target patients with private insurance because the companies tend to pay higher rates than government-backed plans like Medicare and Medicaid.

The mailings also advertise a variety of tests, such as screenings for cancers and cholesterol, which are generally more expensive.

As record numbers of Americans go without health insurance, hospitals targeting consumers who are more capable of shelling out money for services has been an inevitable outcome, along with soaring health insurance premiums (Read why the rich are building their own hospitals.)

To make matters worse, employers are also reducing health insurance benefits in the workplace.

As we recently reported, one in five Americans are experiencing difficulty paying off their medical debt, while 25 percent have considered filing for bankruptcy because of rising medical bills. 

Though targeted mailings might place others without insurance at a disadvantage, hospital officials insist they target patients who pay more to make enough profit to serve everyone.

Now learn 6 ways to arm yourself against rising health insurance costs >

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Monday, February 6th, 2012 news No Comments

Beats Dumps Monster Over Headphone Spat [Audio]

Source: http://gizmodo.com/5875715/beats-dumps-monster-over-headphone-spat

Beats Dumps Monster Over Headphone SpatPeanut butter and jelly, unicorns and glitter, Beats Electronics and Monster. One of these things just doesn’t belong, one of these things is not like the others. After a five-year collaboration, the two companies have terminated their relationship but do hope to remain friends.

According to Businessweek, the breakup came about due to an irreconcilable dispute between Beat’s Jimmy Iovine and Monster’s Noel Lee over which company deserved more credit for the brand’s 53-percent share of the $1 billion headphone market during the last year. As such, Beats has opted out of renewing its manufacturing contract with Monster when it expires later this year

Monster takes credit for the design and production “They wanted to do speakers and I said, ‘The new speaker is the headphone,’ ” says Lee. Beats, on the other hand believes its celebrity connections helped market the devices as high-quality status symbols. “Now a big part of what you’re paying for is the brand and fashion,” Ben Arnold, director of industry analysis for NPD, told Businessweek.

It’s still too soon to see who will ultimately come out ahead from this. Beats Electronics remains the preeminent brand for twentysomethings. Monster on the other hand will have to find a way to replace the lost revenue—reportedly 60 percent of its of privately held revenues and profit. Its recently announced partnerships with fashion brand Diesel and Radio Shack should do nicely though. Those products are expected to hit shelves later this year. [Businessweek via CNetPhoto by Elsa/Getty]


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Friday, January 13th, 2012 news No Comments

Here’s The Math Formula For Structuring A Groupon Deal That Doesn’t Lose Money (GRPN)

Source: http://www.businessinsider.com/heres-the-math-formula-for-structuring-a-groupon-deal-that-doesnt-lose-money-2011-12


groupon cupcake girl

We’ve all heard the nightmare stories about Groupon merchants who lost tons of money because they were suddenly overwhelmed with thousands of customers whom they were forced to serve at a loss: The British bakery that made 102,000 cupcakes. The Irish hairdressers whose customer base now consists entirely of people who only want their hair cut a discount. The Portland cafe that lost $8,000 because the owner failed to cap the number of deals she offered.

It’s not just Groupon, of course. There are loads of other daily deal sites — Living Social, Thrillist, Google Offers, etc — but they all present merchants with the same problem: The conflict between offering below-cost deals to customers in hopes of attracting long-term “regulars” and structuring a deal so that you can still make a profit. The math can be tricky because merchants have to account for two different sets of discounts: The discount to the customer and share of the payment taken by the daily deal site for publicizing the offer.

Now TheDealMix, a site that aggregates daily deals into an impressively complicated map of your neighborhood, has produced an infographic that can help businesses calculate daily deal offers so th! at they won’t accidentally go bankrupt.

And, yes, The DealMix has presented its formulas in the form of cupcakes — particularly useful given the number of bakery-related Groupon disasters that have made the headlines.

The formulas include:

Offer Price – Cost of Goods > $0

Average Customer Spend – Value of Offer + Price > Cost of Goods

See the rest of the story at Business Insider

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Monday, December 12th, 2011 news No Comments

Cablevision reports Q3 earnings, sees profit fall by 65 percent, drop in video subscribers

Source: http://www.engadget.com/2011/10/31/cablevision-reports-q3-earnings-sees-profit-fall-by-65-percent/

It’s safe to say that Q3 2011 probably won’t be remembered as Cablevision‘s finest. According to the provider’s latest earnings report, profits declined by a full 65 percent over the year, with net income plunging to $39.3 million this quarter, compared with the $112.1 million it raked in during the third quarter of 2010. The company also reported a loss of 19,000 video subscribers during Q3, though it added 17,000 broadband customers and 38,000 telephone subscribers. Total customers, however, declined by 15,000 over the past three months. Revenue, meanwhile, increased by eight percent to $1.7 billion, though the New York-area operator lost about $16 million to Hurricane Irene — not to mention all those legal fees. Smell that? That’s a big platter of PR, sitting right there after the break.

Continue reading Cablevision reports Q3 earnings, sees profit fall by 65 percent, drop in video subscribers

Cablevision reports Q3 earnings, sees profit fall by 65 percent, drop in video subscribers! origina lly appeared on Engadget on Mon, 31 Oct 2011 07:01:00 EDT. Please see our terms for use of feeds.

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Monday, October 31st, 2011 news No Comments

Dr. Augustine Fou is Digital Consigliere to marketing executives, advising them on digital strategy and Unified Marketing(tm). Dr Fou has over 17 years of in-the-trenches, hands-on experience, which enables him to provide objective, in-depth assessments of their current marketing programs and recommendations for improving business impact and ROI using digital insights.

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