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Napster vs iTunes: Superbowl Ad

Since this thread was supposedly about the ad and not the napster service itself, here's my say:

If Napster has a 2/10ths-decent marketing firm, then the point of this advertisement is not to get customers to "do the math" -- no advertising campaign is.

Advertisements are only rarely geared at people who know about the product, sit down, and analyze the options. Those are not people who would be convinced by any advertisement.

If this ad can get the people who don't think about it to get into the mindset that "Napster is cheap, iTunes is expensive", then the campaign will have been successful.
 
coolsoldier said:
Since this thread was supposedly about the ad and not the napster service itself, here's my say:

If Napster has a 2/10ths-decent marketing firm, then the point of this advertisement is not to get customers to "do the math" -- no advertising campaign is.

Advertisements are only rarely geared at people who know about the product, sit down, and analyze the options. Those are not people who would be convinced by any advertisement.

If this ad can get the people who don't think about it to get into the mindset that "Napster is cheap, iTunes is expensive", then the campaign will have been successful.
Click to expand...

I agree, except I would add 1 additional measure:

Beyond product/brand positioning and recognition, they also must get a certain number of customers to sign up for the service to get some income.

Napster sales for the last 12 months was $109.7 Million, with a $50.1 million loss. Total value of all their stock is $335.5 million. Dropping 1/3 of your sales (10% of your total stock value) on a single add is bold (some might say risky).

So they need to realize more from this add than just to change the mindset...

...Napster, do the math!
 
dicklacara said:
I agree, except I would add 1 additional measure:

Beyond product/brand positioning and recognition, they also must get a certain number of customers to sign up for the service to get some income.

Napster sales for the last 12 months was $109.7 Million, with a $50.1 million loss. Total value of all their stock is $335.5 million. Dropping 1/3 of your sales (10% of your total stock value) on a single add is bold (some might say risky).

So they need to realize more from this add than just to change the mindset...

...Napster, do the math!
Click to expand...


Forgot to include:

Napster's Profit margin is currently 66% (no taxes, since they are running at a loss)

So 1,000,000 new customers @ $15/month will pay for the add in 2 months, and earn

1,000,000 * $15 * 10 * 66% net income for the rest of the year (assuming that there are no expenses associated with 1,000,000 new customers/purchases, etc). This gives an annual net profit of $99 million...

... if they can get and hold 1 million new customers for 12 months.

This would be quite an accomplishment, but not very likely (IMO).

Do the math with 500,000 new customers, with 100,000.

with 500,000 new and sustained customers it will take 4 months to recoup the price of the Superbowl ad. They would end the year with a profit of $39.6 million

With 200,000 new and sustained customers it will take 10 months just to recoup the price of the SuperBowl ad. They would end the year with a profit of $3.96 million

With 100,000 new and sustained customers it will take 20 months just to recoup the price of the SuperBowl ad-- But shareholders and the investment community like to see results every 3 months and major results every 12 months... they get restless!

So, the math says that this ad needs to bring in and sustain about 175,000 new customers for 12 months-- just to pay for the ad and break even for the year (if there are no additional expenses).

The ad runs Sunday, Napster;s next earnings report is Wednesday 2/9/05.

Napster (NAPS) shares closed Friday at $9.64

Buy, sell, short, anyone?
 
superleccy said:
Music downloaded from the iTunes Music Store can only be played on your computer and your iPod. But, once you've paid for them, they are yours forever (ie, there is no subscription charge)... and you can burn them to CD if you want too. You can't do any of that with Napster (as far as I know).
Click to expand...
I didn't see anyone correct this inaccurate post. So, here it is from the source:

You can truly feel good about buying music from the iTunes Music Store. In fact, you’ll be able to enjoy it in almost all the ways you enjoy the CDs you buy at a music store. For example, just as you might listen to a CD at home, in your car, and at work, you can listen to your iTunes Music Store music on up to five different computers. The first time you play a song that you’ve purchased your computer becomes “authorized” to play all the music you’ve purchased. This authorization helps protect the artists’ copyrights.
*
You can also download your purchased music to an unlimited number of iPod devices to take your songs on the road. You can add the music you purchased from the iTunes Music Store to any of your playlists. And you can even burn your purchased music to a CD.
 
Here's one sad fact to note: I work at a Best Buy and we are advertising (starting today) this Napster-To-Go program. The only problem is that most people that have seen our ad believe they get to keep the songs they download. Now, I know that you really can't keep them however, if they hook people this way, then it could cause problems for iTunes down the road. Since people don't want to "lose" the songs they already have, they might just continue the service.
 
Napster??? does that still trying to live???

It is a very very stupid campagn!!! rent the music??? who cares if I can have millions of music rented!!!! I prefer to pay my money to buy and keep my songs and maybe I could use it for something else... like it was mentioned before... If they think that is going to be a hit??? well they must think real good again... really or maybe find a better marketing plans...
definitly!!!!
 
Now if we can get auto manufacturers to support AAC in their car decks as I really hate carrying around my iPod in my car. I'd like to see AAC DVD discs compatible with my Pioneer car stereo system.
 
Anybody that pays for a lossy copy of an original is desparate or just dumb. I'm shocked at how successful this has become. Why don't you get the option to download the original music file if you have paid for it? That would justify charging for a cheap copy.
 
Lacero said:
Now if we can get auto manufacturers to support AAC in their car decks as I really hate carrying around my iPod in my car. I'd like to see AAC DVD discs compatible with my Pioneer car stereo system.
Click to expand...

Haven't looked at car stereos lately have you? AAC is available, ATRAC too.
 
stupidity!!!

people can just subscribe for 1 month and get however many gb they want of music, Then people could rip the music on their computers so the 1 month licence no longer exists and keep it, come on how much does napster have to pay the record companies cos i think this will cause a loss of profit rather than a gain.

Either that or the music will be set to the computers clock... one month can last a long time if that is the case, i think the clock goes to 2056 but i am probably wrong
 
yeah. Isnt it perfectly easy to record the sound coming out of the computer and then have it on a CD?

There really isnt any protection for music, (or anything else for that matter) when we get right down to it.
Napster and the Winworld of gates really just want to get those license fees, and then get their stock price up (paper money-not real) and then sell when high, or sell 'short;, ( I assume that means predict a fall in price), and turn fantasy money into real money and then have a real life.

"If I could only have ten million bucks I could relax and write my novel - I just have to work like a loony for 30 years, and then life will be perfect"

A little off-topic, sorry.

Napster seems to be just inviting more piracy, whereas iTunes is actually selling the music at a 'realistic' price.

Pump and Dump. Live later, not now. Its all a bit misguided.......
 
LOVE MY SAMSUNG NAPSTER PLAYER

Yep I own the 20 gig Samsung Napster player. LOVE it. Use it EVERYDAY. But no....I won't be subscribing to this new subscription service. Once the music files are transferred to the player they are STUCK there. You cannot transfer them back to your PC. All music downloaded with this subscription service will be STUCK on the player until you delete it. So yeah...download unlimited amounts of music...BUT make sure to delete some in order to make room for the new stuff. Although I own the Samsung player and HAVE to use the Napster Program to transfer my music to my player I do not and will not use the Napster service. I use my player to play music that I OWN and have converted to mp3 format. My player is strictly for convenience purposes. There is nothing sweeter than having 200+ CD'S in th palm of your hand. Although I am sure the Samsung player is missing some feautures that the Ipod has it stills serves my purposes extremely well. But...I can say as a new Emac owner my next player WILL be a Ipod when I am ready to buy another player.

Will this new Napster subscription service succeed??? Your damn right it will. There are simply to many people who for their own reasons will not buy cd's. I myself prefer to own and support the artist that I love. That is why my 20 gig player has only music that I have purchased legally.

As a new Mac owner I have to say that I more than a little disappointed in some of the "attitude" that I read on this message board. There are tons of people here that are more than willing to offer great advice to newbies like myself and I have certainly read and learned alot since coming here. But a few seem to me more interested in ridiculing other OS's and not even bothering to give a decent answer to a question posted here other than than to spread their hatred for anything not Mac related.

Think about this....if I tunes offered a subscription service ALONG WITH their current method of selling music...you people would be bending over to kiss Apple's ass. But...since Napster thought of it first, oh no it sucks and it's stupid and it's lame etc etc etc. For ME a subscription service would not work. I prefer to actually OWN the real cd. Although I must admit that there are some artist that I like on the radio but don't like them enough to actually BUY their CD's. So this is where the marketing genious of a subscription service comes into play. Not only can I buy the music that I truly want to OWN and keep forever and play on multiple sources but I could also download and play a million different songs and when I got bored delete them and download some different ones...all for one low monthly price. Not only will the artist be paid for these downloads but I won't have to waste my money buying Cd's or .99 cent downloads that I'm not interested in keeping forever. Not a bad plan when you think of it like that.

LOVE my new Emac...AND will love my new Ipod WHEN they reach 100+ gig in size WITH video playback like the Iriver and a few others. I want ALL my cd's PLUS TV shows and movies I've recorded on my TV tuner card available in the palm of my hand. Hurry up Apple !!!!!

Russ
 
AliensAreFuzzy said:
Anyone else think that the Napster commecial sucked big time? Not only in content, but general quality.
Click to expand...
agreed. very week. no real message.
It's funny how a company (the one that bought napster) is trying to utilize the brand equity. What was one a pirate network, is now legit. Ba-haa
 
There was a certain momentum of the game and of the commercials, and napster killed it. I had to stop, think and try and figure out what that sign said. Total mood killer. At least other products that i don't endorse were at least entertaining.
 
geoffism said:
agreed. very week. no real message.
It's funny how a company (the one that bought napster) is trying to utilize the brand equity. What was one a pirate network, is now legit. Ba-haa
Click to expand...

...Thud!

I got the impression that the ad fell flat-- like an inside joke that only a few people understood!

I don't think this type of add will create any new customers for (or even cause people to investigate) digital music, players and services-- maybe it wasn't meant to.

Nor do I think this will convince many current iPod owners or iTunes customers to drop these so they can use Napster instead.

I don't think many current iPod owners or iTunes customers will buy the napster service and another player in addition to the iTunes/iPod offerings,

There doesn't seem to be enough in the Napster solution to make and current users switch or buy both.

So, that leaves people who want a digital music solution that don't already have one as their potential customers.

Apple/iTunes/iPod have somewhere around 70% market share and their ads, as well as word-of-mouth, are driving/creating the market.

The "Either Us or Them" challenge is not attractive from either an under dog or the market leader.

Napster would have been better served by offering a service that piggy-backs and augemnts the Apple offerings-- find a way to get the Napster rentals/purchases into iTunes and the iPod. But, if this is not possible, Napster needs to take another approach-- to create new customers, to kindle a need for their offerings. I don't think they can build a business stealing Apple customers-- at least, not with what they currently have to offer,

Apple should ignore them, lest it makes Apple look like a bully.

Napster has said they plan a $30 million ad campain over the next few months-- this (and the leadup publicity) was the opening shot.

I predict that Napster will quietly abandon most of the ad money not already comitted as the anticipated subscriptions fail to materialize.

It is sad, because many (including myself) would try the service for a month or two to see if we like it-- if we didn't have to start over (in my case, buy a pc),

The silence is deafining!
 
The Napster commerical sucked to high heaven. If I were a "fence sitter", I'd have leaned Apple after that.
 
Yeah

Yeah the commercial sucked. Putting $10,000 next to iTunes aand iPod seems like a stretch that would really confuse the average persons math skills.

Things that Napster and other similar companies don't get.....
If a consumer goes to the store to buy a TV and a DVD player, they will usually buy both of the same brand bc they will most likely work better together and only need one remote to control both.

QA Quality Assurance... something that Microsoft has never understood since they have to support so many hardware vendors.

iPod and iTunes=complete package that works almost flawlessly.

btw Who owns Napster? Vivendi/Universal? if so there was a great wired interview with the CEO of Vivendi/Universal in a 2001 issue. He basically said head didn't believe in "fair use" and wanted to control all his company's music with subscription plans, always controlling the use/play of all their music.

well, i'll just get my music from someone other than Big Brother



peace
 
I don't know if it was noted in this thread or another but 10,000 songs does not cost $10,000 but $9,990 turns out that the people at Napster cannot count.
 
dicklacara said:
...Thud!

Napster has said they plan a $30 million ad campain over the next few months-- this (and the leadup publicity) was the opening shot.
Click to expand...
I'd really like to know what agency built and sold them this sorry campaign.
 
fordlemon said:
Anybody that pays for a lossy copy of an original is desparate or just dumb. I'm shocked at how successful this has become. Why don't you get the option to download the original music file if you have paid for it? That would justify charging for a cheap copy.
Click to expand...

A CD is a lossy copy of the original. Vinyl albums are arguably better in that they're not sampled. But the downsides of a vinly lp far outweigh the minor (and arguably unaudible) upside.

Downloading a full quality audio cd file can be close to 100mb a song. Usually at least 50mb. Since a CD can hold 700mb, downloading whole albums would certainly be a blast. And storing them would take ridicullus amounts of drive space. 10 albums (what's that 130 songs?) would take up an entire mini iPod! The 1 gig shuffle holds twice that at 1 gig!

The original tapes from the studio sound the best. Why don't you go hunt those down? The FM radio has a lot less range than the AACs. I'll bet you still listen to it. Oh, and if you don't have the best speakers in the world, you're missing something as well.

The iTunes music store sells music that is for the most part indistinguishable from the origninal CD. The files are a fraction of the size. It's cheaper than buying a whole CD. Even buying the whole CD on iTunes is cheaper.

I think you need to do a little math. And reasoning.
 
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