Last month, while travelling through Yangon, Myanmar, I asked my guide to take a picture of me. As I handed him my iPhone, I asked, “You know how to take it, right?” He responded, slightly offended, “Of course.”
I only meant to ask if he had used an iPhone before; I would have asked my mother the same thing. The concern was purely practical: if he didn’t know what to press, I could show him quickly.
Apple doesn’t sell the iPhone in Myanmar, according to a spokeswoman. It has two authorized resellers in Yangon, which sell Mac computers, but that’s it. But Thurien Myint, my guide, told me that the most admired phones in Myanmar are the iPhone 5C, which costs roughly a thousand dollars, and the iPhone 5S, with a price tag of about fourteen hundred dollars. And they’re not sold in some shady alleyway, he said; there’s a proper store in a shopping mall. But are people actually buying iPhones, or only coveting them?
Myanmar’s parliamentary elections, held in November, 2010, ushered in a new government the following January. Many considered the elections flawed, and Thein Sein, the new President, appointed several former and current military officers to the government. But Thein Sein’s administration has also opened up the country to the outside world, inviting tourists and investments in a variety of sectors, including telecom.
Myanmar is still a country without much transparency, and information about the number of phones shipped there is limited. For the first half of last year, a total of a hundred and sixty thousand phones were shipped to Myanmar, says International Data Corporation, a research firm that recently started tracking the market. To put that in perspective, during the same period, more than twelve million phones were shipped to Vietnam, a hundred and twenty-three million were shipped to India, and two hundred and four million were shipped to China.
“It’s still a very small market that’s just started opening up,” Melissa Chau, an I.D.C. analyst, told me. In the first half of 2013, the manufacturer with the greatest market share was Huawei, whose phones start at a hundred and ten dollars. Samsung was second, followed by HTC. Apple ranked seventh, with less than one per cent of the market, according to Chau.
On Monday, Apple reported that it sold fifty-one million iPhones in the fourth quarter of 2013, falling short of the fifty-five million that analysts had expected. “Many investors have been worried that essentially all the wealthy people already have high-end smartphones,” Toni Sacconaghi, a financial analyst at Sanford C. Bernstein, told the Times, referring to markets like the United States and Western Europe. Demand in emerging markets, including China, Latin America, and Russia, remained strong. Apple should do even better in Asia now that it has partnered with China Mobile, the world’s largest service provider, to start selling iPhones in China.
But the iPhone 5S—at eight hundred and seventy dollars in China and fourteen hundred dollars in Myanmar—is still out of reach for most Asians and is far from being popular. After an initial burst of sales, Apple could hit a wall in Asia, as it has in the West: for too many people, iPhones may simply be too expensive.
The Myanmar case is an extreme one, of course. Since iPhones aren’t officially sold there, their prices are especially high; the few that make it into the country are gray-market units bought in the United States, Hong Kong, Singapore, and elsewhere, Chau explained. Still, the country serves as a cautionary tale for Apple as it tries to persuade Asians to pay a lot of money for the cachet of being an iPhone owner, much more than competitors are asking for their phones.
Myanmar is one of the only countries in the world where cell phones remain rare. Until a couple of years ago, it was practically impossible for someone not connected to military rulers to get service. Even then, people had to pay up to three thousand dollars for a phone. But the situation has started to change: now they can buy a SIM card for about two hundred dollars. Incoming calls are free, and outgoing calls cost about five cents a minute. To help expand access to SIM cards—and, surely, as a publicity stunt—the government has started a raffle where the winner gets a SIM card for only two dollars. To enter, you just fill out a form and deposit it at a government office. The catch is that there is only one winner a month, although losers, if they’re willing to put in a fresh application, can reapply.
Myanmar’s two domestic cell-phone operators offer poor coverage and service, but last June the government handed new fifteen-year telecom licenses to Telenor, of Norway, and Ooredoo, of Qatar. With these companies preparing to beef up the country’s telecom infrastructure, it’s now only a matter of time before cell phones become as ubiquitous in the country as bicycles once were. (Those who can afford motorcycles and cars have left their bikes behind.) Already, the change in cell-phone access is fairly visible in urban areas. And, even if people don’t have cell phones, they certainly are up to speed on the latest models, as I discovered during my travels.
I was using my phone to take a picture at a temple in Bagan, an ancient city with hundreds of Buddhist temples, when I noticed that a kid who had been selling trinkets to tourists was peering over my shoulder as I knelt on the ground. “Oh, iPhone!” he said. He added, in a more subdued tone, “Oh, 4. Hmm.” And he walked away.
Megha Bahree is a freelance journalist based in New Delhi. She writes about business and development in India and elsewhere in the subcontinent.
Photograph by Prasit Chansareekorn/Flickr Vision/Getty.
Recently, people started observing that Facebook might be losing its youthful edge: there had been surveys, analysts’ reports, and even a disclosure from the company which suggested that young people wanted to spend their time elsewhere. When I first heard this, I reacted with a weird defensiveness. This seemed like a bafflingly personal response, even to me, until I realized that all the commentary was making me feel old.
I started using Facebook in 2004, the year that Mark Zuckerberg founded it. I was in college back then, at Stanford, where the site launched early. Its features were, by today’s standards, clunky and retrograde: the logo was an eerie image of a man’s shadowed face; the site announced itself, in type along the bottom of the screen, as a “Mark Zuckerberg production.” And yet being on Facebook was, for a little while, like knowing about a band that few others had discovered. It was cool.
Next month, Facebook will have existed for ten years. The site itself has grown up, too: it lost the weird logo and the Zuckerberg shout-out; it added photo albums, the news feed, better privacy settings, and, of course, advertisements; and it is no longer cool—a status that has been passed on to upstarts like Snapchat (which Facebook has tried to acquire) and Instagram (which it did acquire).
Zuckerberg, who launched the site from his college dorm room, is now a married homeowner. I am married, too, though not a homeowner. Sometimes I idly browse houses on Redfin and mark my favorites—a weird hobby of mine. My Redfin account is linked to my Facebook account, and the site dutifully takes note of my choices. If one day my husband and I start actively shopping for a house—which we surely will—Facebook will know more about our tastes than any human being could. What’s more, the site can probably tell, perhaps creepily, that we might already be in the market for a house, on some level, even though we see ourselves as nothing more than casual lurkers at open houses and on real-estate Web sites.
All of which is to say that people might have been asking the wrong question when, ahead of Facebook’s earnings announcement, on Wednesday, they wondered whether the company had been able to keep teen-agers interested enough. As it turned out, the company trounced analysts’ expectations, announcing revenue of $2.59 billion—an increase of more than sixty per cent from a year earlier.
In a call with analysts after releasing the earnings report, Facebook executives, including Zuckerberg, didn’t discuss “Facebook’s teen problem,” as Mike Isaac, of Recode, has put it. Instead, they focussed on the company’s growth in ad sales—driven largely by the success of the ads that the company displays in people’s news feeds, sandwiched between links to Onion articles and friends’ baby albums.
For a long time, Facebook struggled to convince marketers that these ads were useful. But that’s changed, Facebook’s chief operating officer, Sheryl Sandberg, said. Facebook now has data that helps it prove to marketers that there is a specific—and significant—return on their investment in news-feed ads.
“Our goal is, in an privacy-safe way, to get information we can about what consumers want and then help connect marketers, so the ad experience is great for users,” Sandberg said on the call—whether that information comes from people’s “likes” on Facebook, their activity on other sites, or “contextual statements they might make in their status updates.”
In other words, by figuring out what people are interested in, Facebook can show them ads that are super-relevant, thus persuading them to buy things, thus persuading marketers that the ads are effective and worth the money. Surely, this is as true when it comes to adult Facebook users as it is for teens—and perhaps even more so. (Cutting-edge as I might have been as a teen-ager, my paychecks from my after-school job were pretty modest. And I definitely wasn’t shopping for real estate.)
Facebook’s user growth has slowed, which was inevitable. (Notably, the company spent little time discussing the somewhat unimpressive growth in users who visit the site daily and monthly.) That could eventually be a problem. But it isn’t yet. That’s because Facebook is still making ever-increasing amounts of money from all the information it has collected—in some cases, over the past decade—about its users. The company is getting more and more revenue from each user: on average, $2.14 per user in the fourth quarter, up from $1.54 a year earlier.
Sandberg’s comments on the analyst call sounded, at times, like a sales pitch to advertisers. This was surely intentional. She is a former executive at Google, which, the year that Facebook was founded, was wooing advertisers with a concept that seemed novel at the time: What if you could use people’s search habits to understand what they wanted to buy and show them ads for those products? Facebook might be maturing, but to anyone but the most jaded techies, Sandberg’s description of how some advertisers use the site sounded like a line from a sci-fi novel: “If you look at people trying to find consumers,” she said, “we offer the opportunity to get people before they search.”
Photograph by Andrew Harrer/Bloomberg via Getty.
Having sacrificed a little of our collective dignity by agreeing to treat Super Bowl advertisements as a worthy companion entertainment to the game itself, the least we can expect, it seems, is that those ads be entertaining—dramatic, moving, or funny, but, mostly, original, both by being interesting and, more plainly, by being new. But, by the time that we sit down to watch this Sunday, many of the “must see” commercials will already have been seen—previewed extensively or else released ahead of time online and shared on social media. This might be good for business (more on that in a moment), but it makes for lesser viewing.
This year, a thirty-second spot costs a bit more than four million dollars—and Fox, which is broadcasting the game, had no trouble finding companies to pay for the opportunity. But most of these companies aren’t really buying Super Bowl ads anymore. At least, that’s not all, or even especially, what they are buying. Instead, they have paid for the ability, for several weeks leading up to the big day, to tell people that they’ve bought a Super Bowl ad.
“Many advertisers think of it now as a monthlong challenge,” Tim Calkins, a professor of marketing at Northwestern University’s Kellogg School of Management, told me. “It is not about winning the Super Bowl but winning an entire month.”
To that end, the likes of Toyota, Jaguar, Audi, Dannon Oikos yogurt, Butterfinger, CarMax, and others began the Super Bowl ad season by releasing teaser spots for their commercials. Toyota promised the Muppets; Dannon previewed the reunion of the men from the nineties sitcom “Full House”; and Jaguar introduced a trio of British villains who luxuriate in being bad and driving fast. Many teaser campaigns, like those of Jaguar and Butterfinger, have companion Web sites with “making of” and “behind the scenes” footage. If a viewer visits one of these sites sometime in January, that’s a win for the company, and it doesn’t really matter whether the person watches the ad during the game.
Bud Light’s preview campaign has been especially extensive. The beer company has released six thirty-second teasers for its Super Bowl ad, both online and on television. One features Arnold Schwarzenegger playing table tennis in a Bjorn Borg-style track jacket. Another has Don Cheadle and a llama. The tagline promises “Whatever Is Coming,” which itself seems like a winking parody of Super Bowl ad culture—something exciting is on the way, though it might not matter exactly what it is. “It is really a strange place to be: releasing six commercials to tell people that you are going to run a commercial,” said Calkins.
Companies have attempted to generate buzz for their Super Bowl ads for years—often taking out ads in print or broadcast media, as well as online. But only recently has the teaser model, with short ads released in advance, like movie trailers, become standard. Yet what many companies are previewing this year can’t exactly be called Super Bowl ads, because so many of them are released days, or, in the case of Axe body spray, even weeks ahead of the game.
Dannon has already released its complete “Full House” spot, rendering any big reveal during the game moot. The same is true for Kia, whose ad features Laurence Fishburne recreating his role as Morpheus from “The Matrix.” Jaguar has released its villain spot as well. These were the kinds of big splashes that used to be closely guarded—hinted at but not spoiled—and which gave advertising during the Super Bowl its unique dramatic flair.
“The surprise factor doesn’t matter as it once did,” Justin Osbourne, the general manager of brand and marketing communications at Volkswagen of America, told me. “Our goals are about how many total views we can get. To assume that that is going to happen within forty-eight hours is cutting yourself pretty short.”
Volkswagen helped pioneer the early-release model, in 2011, when, along with the ad agency Deutsch, the company got Lucasfilm to license the character Darth Vader—shrunken down to kid size—for a commercial titled “The Force,” which highlighted the features of the Passat sedan. Rather than keep it a secret and reveal it during the airtime for which the company had paid, it didn’t just tease the ad, but put the whole thing out early, leading to blanket coverage online, and nearly twenty million views before the game had even started. Volkswagen has been releasing its Super Bowl ads early ever since—the company posted a teaser for its 2014 ad a few weeks ago and, on Tuesday, released its completed commercial.
The idea is straightforward: the window to reach fans before the game is big; the one after it is very small—no more than a day or two, according to several people to whom I spoke—after which people stop caring about Super Bowl ads. Last year, the early release of Volkswagen’s ad, about a Midwesterner turned Jamaican-cool by his red Beetle, generated a different kind of attention, sparking criticism in some quarters that it was racially insensitive. Some suggested that the ad should be pulled—speaking as if the “real” Super Bowl ad existed in some future tense. VW ran it, unchanged, during the game.
Since 2011, more companies have released their ads early, diminishing the importance of Super Bowl airtime itself, at least to a point. More than a hundred million people watch the Super Bowl, many more than the number who watch ads online before the game. Many people will see an ad for the first time when it runs on television, on February 2nd. But, for others, especially the kinds of people likely to spend the game with a laptop or cell phone in front of them, ready to tweet about what they see, the ads might already be a bit stale. In this way, the ads themselves have become another kind of on-demand entertainment, watched when and as often as the viewer wants. Bathroom breaks have gotten much easier to schedule.
Yet no one has found a way to release the Super Bowl itself ahead of time. It remains one of American culture’s great live events, and there is something cheering in the idea of being confined in a moment with millions of other viewers. As more companies circumvent the constraints of time with built-up preview campaigns and the early release of full ads, there is something to be said, from a viewing perspective, and, perhaps, even from a business one, for those that continue to value the dramatic possibilities of surprise.
Over the past few years, Chrysler, working with several creative agencies, has embraced the liveness of the Super Bowl, as well as its role as a de-facto national holiday. Last year, it ran a pair of polished two-minute advertisements—one for Jeep, in which it celebrated, with the help of Oprah, the homecoming of American troops, and the other for Dodge Ram trucks, in which it celebrated, with the help of the late Paul Harvey, the strength and ingenuity of the American farmer. These were both appeals to a blue-collar, patriotic identity—in line with Chrysler’s “Imported from Detroit” campaigns from the two previous years, the first, in 2011, featuring Eminem cruising 8 Mile Road and the second, a year later, showcasing Clint Eastwood’s manly whisper as he observed that it was “halftime in America.”
These felt less like ads than like public-service announcements. That trick was aided by the fact that the ads appeared unexpectedly, without weeks of hype prodding us to get ready to be moved. Their form connected directly to their message: everyone saw them for the first time at the same moment; we were all in it together.
Yet in what, exactly? Each of these ads could put some dust in your eye but then leave you, a few moments later, not quite sure who had been doing the selling. Here, then, is the risk of débuting an ad during the game, without the so-called “seeding” of teasers or an early release: viewers might be compelled by what they see, but rather confused about what commercial transaction they’ve been prodded to consider. Be a farmer? Support the troops? Had they seen the ad beforehand, or read coverage about it in the press, they might be more likely to identify the brand with its message.
Still, the ad industry has cheered these campaigns. Advertising Age named Chrysler its 2012 marketer of the year, citing specific sales gains following its Super Bowl promotions. Last year, according to Crain’s, sales of Ram trucks “climbed three percent in February and twenty-six percent in March over 2012 in the two months after the Super Bowl spot was broadcast.” Perhaps Chrysler’s old-fashionedness will turn into a new fashion. Heinz Ketchup, for instance, advertising during the Super Bowl for the first time in sixteen years, has been very quiet about its plans. So has Cheerios, which is planning its first-ever Super Bowl ad. “It will be interesting to see if someone else tries it this year, after seeing the success of Chrysler,” Calkins said. “I bet they will.”
As for its plans this year, Chrysler is again being coy in the days leading up to the game. I e-mailed Rick Deneau, a Chrysler spokesman, to ask whether the company would run an ad this year, and whether it would be again be a surprise. To both questions, he responded, “There’s something to be said about being consistent.”
