February 2010

Food marketing is likely to get renewed attention in Washington over the coming weeks as government agencies try to figure out a battle plan against childhood obesity.

Ad agency lobbyists say they support the initiative, especially if it means more emphasis on exercise and physical education in schools, and not on restrictions on advertising as some kind of magic cure for the obesity problem. President Barack Obama last week signed an executive order mandating the creation of a childhood obesity task force. He also gave the task force 90 days to come up with an action plan, and urged "a generation" to solve the problem through a "coordinated federal response." The group will be chaired by Lawrence Summers, assistant to the president for economic policy.

While there was no mention of involvement by the Federal Communications Commission or the Federal Trade Commission, the task force will include the chiefs of whatever agencies Summers chooses. Also involved will be the secretaries of the Interior, Agriculture, Health and Human Services, and Education departments; the director of the Office of Management and Budget; and heads of other groups. The issue also has the attention of Michelle Obama, who has made it a priority through a "Let's Move" campaign.

[Commentary] The rise of social media has been part and parcel of the devolution of authoritative information and the flowering of a million cacophonous voices.

It not only changed the way companies looked at consumers but how consumers looked at each other. By 2005, surveys showed that when it came to the marketplace, Americans were beginning to trust their peers more than well-known authorities and experts. The following year, according to the Trust Barometer Survey conducted by Edelman, an international public relations firm, saw the emergence of "a person like me" as a credible spokesperson for companies and products. By 2010, nearly four in five corporations were planning to move money they once spent on television advertising to some sort of social media campaign. Two weeks ago, Pepsi chose to forgo a high-profile TV spot at halftime of the Super Bowl for a social-media-driven charity campaign that will award the nonprofit organizations that muster the most votes through virtual social networks. Could there be any better proof that social media is the future of marketing? But hold on, now comes Edelman's 2010 Trust Barometer. The latest findings fly in the face of that formerly new conventional wisdom. According to the survey, since 2008 the number of people who view their friends and peers as credible sources of consumer and business information dropped by almost half, from 45% to 25%. Similarly, in the past year, the number of people who view peers as credible spokespersons also slipped. Even more strikingly, however, after a precipitous decline earlier in the decade, informed consumers have regained trust in traditional authorities and experts.

What's going on? Are Facebook friends turning on each other? Did we lose faith in ourselves? Is social media just a fluke? None of the above, says Gail Becker, Edelman's Western regional president. After sifting through the data, she concludes that consumers are merely rebelling against all the noise and reflecting the effects of uncertain times. A few years ago, when peer-to-peer trust was at a peak, social media was still relatively new and its circles were manageable. But since then, the number of friend networks has exploded and every kind of business, for-profit and not, has sought to harness -- we might say, exploit -- them for their gain. That, according to Becker, has made people more skeptical of peer recommendations.

Mobile phone handset makers and network equipment manufacturers are gathering in Barcelona this week with contrasting stories to tell about revenues for the year ahead.

At the Mobile World Congress, the industry's main trade fair, the handset makers say they are looking forward to revenue growth in 2010, on the back of rising handset unit sales. Last year, the total number of handsets sold fell compared with 2008, as consumers bought fewer phones amid the recession. The network equipment makers, however, are braced for a second successive year of sales declines and say 2010 is likely to be worse than 2009. This is because many operators did not start to cut their capital spending until the second half of last year - leaving some to make further reductions this year. But while the handset makers are hoping improved consumer confidence will translate into improving sales, many are still grappling with major technology changes that are shaking up the established order.

[Commentary] I never need to worry about whether I can read a book. As long as a book's a book, that is — printed on paper, in English. I know I can pick it up and read it no matter how long it sits on my shelf after I bought it. But as we move into the era of e-books, that assumption no longer holds. In certain cases, you can't read the electronic book you buy from one store on a device supported by a competing store. Similarly, you can't read e-books you borrow from your library if you don't have the right kind of device. And there's a chance you won't be able to read the e-books you buy today on the e-book reader you own several years from now. Does anyone in the books business realize how dumb this is? Seems not. Because just when the situation seemed to be getting better, it suddenly got worse.