Hits & Misses
(Business 2.0) – [HIT] Father knows best. If you need further proof that tasteless humor sells, witness the encore Super Bowl ad success of GoDaddy.com. Last year GoDaddy burst onto the scene with a spot that spoofed Janet Jackson's infamous "wardrobe malfunction," catapulting itself from complete unknown to the No. 1 domain registrar on the Web. This year the company got PR mileage from the fact that its first 13 ad submissions were rejected by Super Bowl broadcaster ABC. When the approved spot--which promised an unedited version on the Web--finally ran, the site saw a 15-fold spike in traffic, triple the jump enjoyed by any other advertiser. Better yet, the visitors didn't come just to see the racy ad: Though results for the quarter have yet to be tallied, the company reports that new customer sign-ups jumped by 35 percent over average levels in the days following the airing.
[MISS] Game over. As the old saying goes, it's not the features on your device, it's the size of your game library. Just three months after the much-hyped U.S. release of its handheld Gizmondo game console, Tiger Telematics--which was attempting to crack a market dominated by Nintendo and Sony with a device featuring GPS navigation, MP4 video playback, and text-messaging capabilities--filed for bankruptcy protection for its U.K.-based subsidiary, Gizmondo Europe. Analysts say the company failed to overcome the obstacle that has tripped up so many other videogame wannabes: the reluctance of game publishers to adapt popular titles for the fledgling platform. As a result, sales were unable to keep up with the company's mounting debt; Tiger's stock, which topped $30 at its '05 peak, had fallen to 20 cents a share by late February.
[HIT] Jean therapy. In a world where dungarees sell for $300, the company that invented them in 1873 as a cheap, durable choice for laborers is turning itself around by returning the product to its original price point. Levi Strauss has reported its first annual sales growth since 1996, with 2005 profits more than quintupling from the previous year, to $156 million. CEO Phil Marineau credits strong sales of the company's low-end Signature brand, carried primarily by outlets like Kmart and Wal-Mart. Levi's will try to build on the momentum by cutting out the middleman, doubling the number of company-owned retail outlets in North America to 38 by year's end.
[HIT] Grabbing the gold. Though its NBC division took a hit for the lackluster ratings of the Winter Olympics, another division of General Electric was there to pick up the slack. On Feb. 21, as NBC's marquee figure-skating coverage was getting creamed by Fox's American Idol, GE Aviation won $3 billion in contracts from a trio of Indian airlines--part of the largest aircraft order in the nation's history. The deals to supply engines for 50 Boeing 777s and 787s and another 53 jets from Airbus were seen as validation of the company's strategy to target the Indian market, where a population of more than 1 billion is served by fewer than 300 locally based commercial aircraft.
[MISS] A grande, wet, half-caf flop. The world's leading coffee chain rarely makes mistakes, but Starbucks had to fess up to a biggie when it dropped the Chantico chocolate drink from its menu in February. Despite having poured millions into promotional efforts for the "drinkable dessert," including full-page newspaper ads and bountiful free samples, company spokesman Alan Hilowitz admitted that a lack of size and flavor options irked customers accustomed to ordering every drink with a long list of modifications. Industry observers point out another reason that patrons may have declined to quaff: the venti $3 price for the extra-short 6-ounce beverage.
[HIT] Dude, my bank rocks! Forget toasters and wall calendars. Oregon-based Umpqua Bank has found a perk that would-be customers--especially hip young ones--can't resist: downloadable music. Kiosks inside 27 of the bank's 93 branches let customers listen to tunes, largely from local bands, and then burn their own CDs for $8 (or for free if they open a new account). In the first six months since launching the Discover Local Music Project, Umpqua saw a 20 percent increase in new deposits, leading to a 48 percent jump in profits compared with the previous year.