Tom Turkey

Not for nothing, tomorrow is of course Thanksgiving and rather than fill the space with mind numbing financial talk (although the new unemployment filings are down a bit so that is good news and consumer spending is up slightly (does that include fuel and food???).  Speaking of food, I have a home in the Hamptons on Long Island and shop at the only place in our little village. ..  have for 20 years.  Each summer, with the influx of summer rentals etc. from the city (NY) the market jacks up the food prices and they used to lower them a bit when the big business rush went home and left us alone.  Not so the past 4 years at least. We have restricted diets in our household and we notice the change and it is acute. But back to Thanksgiving...and Tom Turkey... 47 million of the birds will bite the dust to satisfy the holiday.  So here are some tidbits for the table-talk after Uncle Ed tells his boyhood stories for the zillionth time and someone complains that the white meat is too dry.

1. Benjamin Franklin wanted the wild turkey to be the national bird of the United States instead of the bald eagle.  When Jefferson won the argument, Franklin called the Turkey "Tom" - hence tom turkey.
2. Domestic turkeys (turkeys raised for eating) weigh twice the amount of a wild turkey; most are even too heavy to fly. On the other hand, wild turkeys fly and spend their nights in the low branches of trees.
3. Wild turkeys are the largest game birds located in this part of the world.
4. Male wild turkeys act much the same as peacocks when it comes to finding a mate; they puff up and spread their tail feathers to attract females.
5. Turkey eggs are tan with specks of brown on them. The eggs take only a month to hatch and when they do, the poults (baby turkeys) stay with their mother for up to a year.
6. The skin on the head and throat of a turkey can range in color from gray to a bright red depending upon the level of excitement or stress in the situation.
7. The turkey acquired its name by mistake; the English thought it was another bird that came from Africa through Turkey. The birds were not the same but the name stuck with the bird anyway.
8. The skin that hangs over the turkey’s beak is called a snood. The skin that hangs from the turkey’s throat is called a caruncle.
9. The scientific name for a turkey is Meleagris gallopavo.
10. Turkeys can have heart attacks and can drown if it’s raining and they look up.
11. A wild turkey’s field of vision is about 270 degrees.
12. Turkeys can run up to 20 miles an hour with short flight bursts up to 55 miles per hour.
13. Male turkeys gobble while female turkeys make a clicking sound.
14. The biggest turkey ever raised weighed a whopping 86 pounds!
15. Adult turkeys have about 5,000 feathers.
16. Over 45 million turkeys are cooked for Thanksgiving.
17. North Carolina produces the most turkeys annually at 61 million.
18. Most domestic turkeys love to have their feathers stroked.
19. Wild turkeys live to up 12 years while the domestic turkey is slaughtered at 5 months.
20. Turkeys have full color vision and a turkey’s gobble can be heard up to a mile away.
21. The ballroom dance called “the turkey trot” was named after the movements of a turkey.
22. Wild turkeys inhabit every state but Alaska.

 

While the Internet was still young...Walmart v. Amazon

Today is, by the way, the 150th anniversary of the publication of Darwin's Origin of Species and in case it isn't bedside reading (or bathroom reading), it obviously dealt with survival of the fittest or at the very least issues of natural selection.  Actually the book was written for the non-scientist and is a great read if you are into that sort of thing.

An article in the NYTimes today (Walmart v. Amazon) is coincidental. I can remember vividly early press and financil reports on Amazon when the CEO was asked if they ever ever ever  could turn a profit and he flatly said he didn't think so.  It was all about distribution, supply, warehousing etc. and a very tough nut to crack.  As to Walmart, I've known one of the Walton kids since about 1980 (brother is that a long story) and it was before he joined the family business which at that point was all about Target v. Walmart.  Walmart's plan was simple. Price.

I encountered  the Walmart price issue first hand in the middle 90s when I headed a  madia planning and buying team for video releases (vhs of theatricals), and we had discussions (if you can call them that) with Walmart regarding the pending release of Babe - the pig movie. 

They were the 800 pound gorilla and would pre-buy a million but at a price that simply had to be the best price or no deal. They also wanted guaranteed advertising (we spent about 8 million $ in 2 weeks) and all kinds of other things. They got it and frankly those million or so units shipped to Walmart were a lost leader both to us and to them.  They could do what they wanted because, simply, they could and there was no one biting at their heels.

Enter Amazon, now, a piddling orphan compared to Walmart but with enormous brand cache and recognition. They have fixed distribution and are doing as well as anyone in this economy.  But what they bring to the table is competition, niche as it may be.  In the 12 years or so of existence, it has morphed into an Internet giant and the online equivilent to the box store Walmart concept.

My issue here, and it relates to Darwin (which you must read) is that all big species faced their greatest threat when they had smaller species to contend with.  These smaller guys disrupted the chain - futzed with the food chain so to speak - and the big guys either had to adapt or die off.  It may take a while but that is the name of the game.  The  NYTimes quote is very telling:

“If you are Wal-Mart, you want to have your proportional piece of this change in consumer behavior,” said Scot Wingo, chief executive of ChannelAdvisor, which helps retailers sell online. “You can even paint a scenario where e-commerce one day is 15 percent of all shopping, and that could really start to erode Wal-Mart’s offline business.”

We are going to put it on display for everyone....

"It was a bargain - we were expecting to pay more," said Hoffman Ma, a Hong Kong hotel executive. "We're going to put it on display in our hotel. It will be free for everyone."

What in the world?  $350,00 plus commission, taxes, etc. so well over $425,000 when things are all counted and they "were expecting to pay more".

We take home several lessons from this:

1.  It was Hong Kong and not Vegas or Atlantic City which wil shed a spotlight on the Vegas and Atlantic City economies.
2.  It was  bought for a crowd drawing appeal item and probably will bring folks into the venue...so we have to ask where is this marvel to excess going to be placed?

This later question is a big issue.  How far would people be willing to travel to view said glove, (as a marketer), be willing to travel to see it? It obviously will be a big draw but let's say that the town of Bay City, Michigan (population 50,000) bought it and put it on Main and Center streets to draw people downtown to shop. And here is the marketing rub.  After a month or so, all of Bay City's shopping traffic will have seen the glove and unless you want to go from afar to Bay City to see it then the glove purchase won't pay out. Or will it?

A study showed that the average downtown Bay City shopper spent just under $60 per shopping visit. That means the glove would have to pay out to the tune of 7,000 new shoppers and not just viewers.  Amortize the  glove's attraction to 10 years and thats about 2 new shoppers a day.  Fairly likely and very possible.

Now with our Hong Kong friend, say he runs a 500 room hotel (for instance) and at Hong Kong rates of $500/night what does he have to pull in? Maybe 1000 more room bookings in total?  Put that to an average stay of 2 nights, meals etc., and he is down to perhaps ONE (1) more booking a day FOR A YEAR to make this pay out.

Nice buy.  A steal actually.  Our Hong Kong friend probably estimates that he will make 10 times profit on his investment and that's not counting street traffic who may dine at the hotel or otherwise use it's shops or facilities in some way.  The word of mouth publicity is probably alone worth the purchase price.

Did you hear that Vegas? Atlantic City? Penny foolish.