The fight is on! McDonalds join forces with Dunkin Donuts against Starbucks…

McDonalds just put up a huge sign in front of the Starbucks headquarters office in Seattle that says, “Four bucks is dumb,” and at the bottom it says, “…now serving espresso.
This sign is displayed on 140 billboards in Western Washington, according to the Seattle Post Intelligent.

This is one of many campaign strategies that McDonalds has taken up since the start of the fall of the famous coffee company, Starbucks.
But is McDonald’s really doing better than Starbucks?

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Big Changes at Newsweek

 

Soon, the Site Will Dominate, Rather than the Glossy Mag Pages

Soon, the Site Will Dominate, Rather than the Glossy Mag Pages

Yesterday, Wash Po.-owned Newsweek announced a series of changes it will be launching in February.  The changes are not just minor tweaks for their publications, but a major shift in philosophy.  Newsweek now plans to change the way it delivers its content, emphasizing the web more and its print version less, and might also distribute content through phones.  Its print magazine will in a way be more bloggish in style, with more opinion stories than straight news reporting and pictures, in an effort to get more links and traffic to their website.  

While much of the commentary has focused on potential jobs cuts, what is really big about this story is the paradigm shift it is setting for print media– i.e. writing stories for a print magazine in a way that they will drive traffic to the website, more controversial POV reporting, more opinions and commentary, etc.  More traffic, more revenue from the website.  But will Newsweek be able to monetize their website in a way that it can be an engine of future growth and profit for the company? WashPo. hopes so, and competitors are watching closely to see the success- or failure- that Newsweek will have.

 

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Whopper Virgins?

Burger King’s new Whopper Virgins ad campaign has brought criticism (and there are 100s more like this one), but in the end it’s more solid marketing from the home of such un-politically correct marketing devices as the subservient chicken (go there and type in Michael Jackson).

This time the home of the Whopper has decided to chronicle the ultimate taste test. BK’s ad firm, Crispin Porter & Bogusky, hired top documentary filmmaker Stacy Peralta, director of the award-winning skater film “Dogtown and Z-Boys,” to go to remote parts of the world and find people who had never tasted or have any concept of a hamburger and have them compare a Whopper and the Big Mac from McDonald’s.

Here is one of the early ads.

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Will Murdoch Soon Own the Times?

Michael Wolff, author of the “The Man Who Owns the News: Inside the Secret World of Rupert Murdoch,” believes the News Corp. CEO will soon make a bid for The New York Times.

Much like Murdoch’s, arguably, hostile takeover of the Wall Street Journal, Wolff sees a similar situation occurring with the Times in the near future.

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Lighting northern lights

c/o Bonnie5378 on flickr

c/o Bonnie5378 on flickr

While the rest of the country saw bleak economic tidings this November, Montanans got good news.  A Presidential Permit was issued for a first-ever energy line between Montana in the U.S. and Alberta, in Canada.  Within a year or two, Montana wind power will be flowing northward across the Canadian border.  It’s not a bad time for a new U.S.-to-Canada export.

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The Fight is On

First Nike abandoned its position in the swimwear industry. Now Adidas says it may be next. But the company isn’t going down without a fight. Recent reports say that Adidas wants “fair and professional” rules and approval processes brought into the sport of swimming.

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Beer Synergy

When Marcel Telles, now one of the directors on the the board of ABInbev, became the CEO of the Brazilian beer brand Brahma in 1989, he knew very little about beer. He decided he needed a benchmark, a model to go by. He took a tour of the best brewers in the world and found what he was looking for in the headquarters of Anheuser-Busch, in St. Louis, Missouri.

“We flew to St.Louis so many times to learn from the guys there,” said Alberto Cerqueira Lima, former marketing director for AmBev and Brahma.

Lima said that Brahma was a very different company before Telles, one of the top three on the InBev side of the A-B deal, came on board. “You were evaluated according to the way you behaved,” he said. Punctuality, the way you presented yourself at meetings, what you wore to work, that’s what counted in order to keep your job and move up. There were many rules and lots of formality.

“All of a sudden, there comes Marcel Telles in jeans, with a habit of always sitting on the conference tables. He brings a different crowd with him. Some [male executives] even wore pony-tails. A crowd that was very fond of swearing too,” said Lima.

“What really matters from now on is results. If you bring in results you will be compensated. Otherwise, your lifespan in this company will be very short,” Lima recalls Telles saying to the staff.

Telles may have admired Anheuser-Busch’s market vision and the outstanding way they managed their brands, but certainly not their corporate environment. A-B is seen as a very traditional company, in which hierarchy plays an important role and bosses rule from behind closed doors.

It will be interesting to observe how synergy will play out between InBev and Anheuser-Busch now that they are one company.

Watch Marcel Telles’ interview with Don Sull at the London Business School

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Journalism Bailout: Really?

The Typepad Journalist Bailout Program has been grabbing the attention of both bloggers and reporters at major news organizaitons.  Naturally, I was intrigued.  As in, a bailout for journalists? And, by Typepad?

Well, kind of.  Except, of course, it’s a bailout minus the billions of public dollars.  This new media biz gives journalists and bloggers who recently lost their jobs a free account on the TypePad blogging platform, for  which non-terminated writers would normally fork over $150.  The recently fired and job-searching journos who are selected get tech support and enrollment in the company’s ad revenue-sharing program.  Currently, the company will select 20 to 30 journalists to support, but hope to provide accounts to the 300+ journalists that have applied so far.  Applicants are asked to link to clips with the companies they used to work for.

The website’s tagline may strike a chord with journalism students: “Because your Tumblr and Tweets, while clever, will not pay your bills.”  The company then writes, “Hello, recently-laid-off or fearful-of-layoffs journalist! We’re Six Apart (you know us as the nice folks who make Movable Type or TypePad, which maybe you used for blogging at your old newspaper or magazine) and we want to help you.”

Simon Owens, who blogs for PBS, chimed in on the conversation skeptically, writing: “The vultures are circling. What was once a small trickle of layoffs at major newspapers has become a waterfall of lost jobs within the media business. One can almost picture the Poynter Institute’s widely read journalism industry blog Romenesko sauntering up to Time Inc. and Conde Nast and screaming, “Bring out your dead!”

The site looks like a good way to grab attention and support for an interactive blog, but it would be difficult at best to generate enough advertising revenue to pay the bills.  Still, props to Typepad for attempting to give journalists a ‘bailout’ in a creative way, even if it might seem gimmicky.  Now, if we could just the government to bail out our student loans… 

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Beer Money

InBev managed to get nearly $55 bi in loans for A-B deal

InBev managed to get nearly $55 bi in loans for A-B deal

What a strange world we live in when banks won’t loan money to help you buy or save your house but they’ll open their coffers if it’s beer you need money for…

To go through with the Anheuser-Busch take-over, InBev borrowed nearly US$55 bi from various banks –  Bank of Tokyo-Mitsubishi UFJ, Barclays Capital, BNP Paribas, Deutsche Bank, Fortis, ING, JP Morgan, Mizuho, Royal Bank of Scotland and Santander.

What a feat, considering the financial crisis and the super tight loan market of the latter days.

But by definition, if it is a loan you’ll have to pay it back at some point.

In ABInBev’s case they’ve already paid most of it.

“In our finance package we have the new debt, we have asset disposals and an equity issuance. The new debt was paid out as we completed the transaction, so that’s done. The equity issuance is something that the Board will decide on the best time to do it; we have a bridge of six months after closing to get it done. And for the disposals of US$7bi we have a bridge of up to 12 months after closing. So we’re working very hard on those,” said ABInBev’s Chief Executive Carlos Brito in an interview about the closing of the deal.

He added that they have a list of five “prized assets,” and the company  only needs to sell two or three of these to meet its obligations. He did not name the assets but some analysts see almost as certain the sale of Anheuser Busch’s theme parks and its packaging group.

“It’s a high risk strategy but if they get it right there will be great upside potential,” said analyst David Liston at Barclays Wealth, according to Reuters.

ABInBev also said that it plans to cut costs by at least $1.5 billion by 2011 and that will help repay the loans.

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Done Deal

InBev completes Budweiser merger

InBev completes Budweiser merger

Anheuser-Busch, St. Louis, Missouri, maker of of “the king of beers” is now is a subsidiary of a company called Anheuser-Busch InBev NV/SA. InBev completed the purchase of Anheuser-Busch last week, paying shareholders $70 per share of stock. Many people believe that the price was too high given the economic crisis and that InBev should have negotiated a new deal.

The new company, named Anheuser-Busch InBev, is now the world’s largest brewer and one of the World’s Top Five Consumer Products Companies.

“Together, Anheuser-Busch and InBev will be able to accomplish much more than each can on its own,” said InBev’s Brazilian boss Carlos Brito, who will become chief executive of the new firm.

“This combination will create a stronger, more competitive global company with an unrivalled worldwide brand portfolio and distribution network, with great potential for growth all over the world.”

Brito is no stranger to overseeing giant mergers. He was part of the merging process of AmBev and Interbrew which created InBev, and he oversaw the acquisition of the three top Brazilian beer brands in Brazil. He knows uniting two huge companies can be very difficult in practical terms. But he said they’re off to a good start. “We’re also being clear from the day one that people need to respect and learn from each other and I think, despite the bumps, we’re going to be on track to deliver on the synergies that we expect integrating the two companies as quickly as possible.”

Watch the full interview with Carlos Brito (it’s free, you just need to register)

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