Hits & Misses
(Business 2.0) – [HIT] Out with the drab.
Fashionistas raised eyebrows at Burberry's move from classic beige tartans to fluorescent colors in its fall line, but the hot-pink and chartreuse trench coats brightened the British label's third-quarter sales, which rose 15 percent over last year. The company's stock has been hiking itself even faster than hemlines, up nearly 50 percent since last summer.
[MISS] Don't corporate dashboards have warning lights?
Royal Dutch Shell stunned analysts when it announced that its oil reserves were 20 percent lower than previously stated--a shortfall equal to 3.9 billion barrels, worth more than $60 billion. Among Shell's overstatements was an as-yet-undeveloped gas field off Australia's west coast; ChevronTexaco, a partner in the project, didn't count the Australian field in its proved reserves. Investors instantly knocked $14 billion off Shell's market cap.
[HIT] A bust? It's really big in Japan.
When California-based Bragel International launched the NuBra here at home, sales were anything but spectacular. Yet as soon as the company took its strapless, stick-on silicone brassiere across the Pacific, the product started selling like round, firm hotcakes: Japanese women bought 210,000 units, half of Bragel's worldwide sales, in less than a year and voted the bra among their favorite products in a poll by Nikkei Business. The secret? In America, NuBra was marketed to young women for wearing with backless dresses, but Bragel's Japanese distributor redesigned the packaging to appeal to women 50 and older, who found that the strapless design reduced backaches.
Eight years after launching next-generation photo film Advantix, Kodak has decided to lock it away in the darkroom. Despite the more than $1 billion spent to develop and market the product line, sales of Advantix cameras have dropped by 75 percent since 2000--a far more dramatic decline than that seen by regular 35mm cameras. Not surprisingly, Kodak CEO Dan Carp said freeing up money was necessary to speed the development of digital cameras, where Kodak is running a distant second to Sony with a market share of 16 percent.
[HIT] Houston, we have a blockbuster.
As everyone from Boeing to Jim Lovell can attest, hitching one's fortunes to NASA's is a risky bet. But when it came to selling a toy Mars rover, Lego blasted off without a hitch. Even as Spirit and Opportunity were still speeding their way to the Red Planet, Lego was landing its Discovery Kids Mars Exploration Rover in stores. When the first rover rolled onto the surface, sales of the replica took off like, well, a rocket. Not even Spirit's software glitches could bring the $89 toy back down to earth. In fact, sales tripled on Lego.com from 5,000 kits a week in early January to more than 15,000 at month's end.
[HIT] I want my MobiTV.
When Sprint introduced a cell-phone TV service in November, reviewers scoffed at the slide-show-like quality. At one frame per second, it barely qualified as video. But the 14 MobiTV channels provided by partner Idetic, including MSNBC and ABC News, were perfectly suited for the medium. Spurred by events like Saddam Hussein's capture and the Democratic primaries, viewers signed on at the rate of 80 per hour, paying $10 a month. By the end of January, Sprint subscribers had watched 7.4 million minutes of MobiTV.
[HIT] The Korean conflict.
After electronics maker LG touted its new 76-inch plasma TV as the world's largest in the days leading up to January's Consumer Electronics Show, Korean compatriot Samsung went on the offensive, rushing an 80-inch prototype from its labs to the show floor. With 4,700 journalists from across the globe in attendance, the sneak attack garnered Samsung headlines from Seoul to Paris. More than bragging rights are at stake: Samsung divisional president G.S. Choi estimates that sales of the $70,000 TVs could reach $70 million a month after production begins later this year.