# HDTiVo Blog: The New Marketing Plan is Not Working



## HDTiVo (Nov 27, 2002)

TiVo's quarterly results announced last week illustrate the poor performance of their 'new marketing plan' (NMP).

Gross Subscriber Additions came in at 4% less than the same quarter last year. NMP was in full effect well before the quarter started and had been in development for at least 6 months prior. Marketing expenses were comparable to last year. The quarter benefitted from the availability of a long awaited unit with dual tuners and more speed.

Most damning of all for NMP, the same quarter last year TiVo purposely attempted to not sell many boxes. Let me restate this because it is important: *MNP could not beat a period when TiVo tried not to sell boxes, despite having a long awaited new product on its side.*

All this comes as no surprise. I explained why NMP would not work when it was first announced. What is more surprising is that TiVo is still trying to figure NMP out (although I also said TiVo really hadn't back then.) On their conference call, Rogers admits TiVo is still adjusting the offerings to learn about what will work. This comes over 10 months after initial development and over 5 months after introduction of NMP. TiVo still appears to have months of 'tweaking' ahead.

*TiVo can do all the 'tweaking' it wants; what it is going to come back to is that the pricing isn't correct and the purchasing mechanics are flawed.*

What has TiVo learned so far? According to them, they've figured out that if they lower 3yr Service by $100, many more folks pick it (50%?) and total sales increase somewhat!! (I am not sure of the exact meaning or interpretation of the statements made.) Well, there's nothing about that that a Freshman in Economics, Business or Marketing wouldn't know without even having to try it.

With NMP TiVo broke something that was already broken. They didn't fix much, if anything. TiVo is just finding out that they have priced the bundles much too high. They likely have yet to understand that there are problems with the terms which also constrict sales.

TiVo's strategy with NMP is to increase ARPU more than SAC (ie. NPV of a Sub) and also increase Sub adds. The second part - Sub adds - is not working, and the first part is in much doubt. TiVo claims that NPV is up under NMP; but that is likely based on assumptions not backed up by actual experience, which I doubt are correct. Simply put, my view is that SAC appears to be increasing by over $100 (long term avg.) and ARPU is not likely to compensate. *One of the great risks I see going forward is the disposable nature of the box under some NMP offerings.*

NMP was supposed to fix the Sub add problem and build the the Service business. TiVo did not have a problem making money with the old offerings, they had a problem not garnering enough Subs to pay for the entire enterprise. Even if TiVo is right that NPV will increase, the decline in Sub adds will hurt more since there will be less overall Service Margin to pay the other bills.

Finally, while TiVo says online sales (now under NMP) have increased relative to retail, with the overall decline in business all that means is NMP is the lesser of the evils. Indeed, NMP itself may be the cause of some of the damage to retail sales.


----------



## rainwater (Sep 21, 2004)

Well, one thing TiVo could do is encourage existing subscribers to buy from TiVo.com. Its obvious TiVo makes more money from direct orders, yet they have no pricing plans available for existing subscribers. It makes no sense that existing subscribers have to buy their TiVos at retail instead of buying direct. I just don't understand why they have to ignore existing subscribers with their new pricing structures. I'm not saying they should offer huge discounts for buying direct, but they should atleast have the option for current users. It seems they are discouraging customer loyalty with the current system.


----------



## HDTiVo (Nov 27, 2002)

rainwater said:


> one thing TiVo could do is encourage existing subscribers to buy from TiVo.com


Right on  :up:

More on MSD to come in the next HDTiVo Blog:

(But don't tell anyone  )


----------



## stevel (Aug 23, 2000)

There's a cardinal rule of marketing - don't undercut your channel. If TiVo sold direct for less than retailers, the retailers would simply stop carrying the product.


----------



## rainwater (Sep 21, 2004)

stevel said:


> There's a cardinal rule of marketing - don't undercut your channel. If TiVo sold direct for less than retailers, the retailers would simply stop carrying the product.


Yes, which I why I said, they don't have to discount the hardware on TiVo.com. But the fact that it would be available would get them a lot more direct sales. A lot of users buy their first TiVo from tivo.com, and if they like it, where do you think they will go first? Then they find out they don't get a MSD and they either decide not to buy or buy it elsewhere. What kind of business model is that?


----------



## Phantom Gremlin (Jun 20, 2002)

HDTiVo said:


> TiVo's quarterly results announced last week illustrate the poor performance of their 'new marketing plan' (NMP).


Yawn. TiVo has *never* had a marketing plan that worked. It would be far too charitable to describe their marketing as *inept.*

I've read your ideas and I agree with things like no commitment to re-subscribe a box. It's just idiotic to require a new commitment. And it's insulting to customers to not drop the monthly cost once a commitment has expired.

As to all your options of various amounts per month vs various amounts up front, maybe it would appeal to Joe Sixpack. However, in marketing to my "professional" demographic it's just too confusing. I'm not saying I can't figure it out, I'm saying I shouldn't need to. I don't want anyone playing those "mind games" with me. I don't want to think about whether I should pay $50 extra up front to save $3 per month. You're insulting me by giving me contrived "choices" like that.

Just tell me the price! I think your proposal is more complicated than airfares. 

TiVo needs a simpler pricing structure, not a more complicated one.

I work in an office with 7 other engineers. I was the first to buy a TiVo. I was the primary reason why 3 other engineers got TiVo and a secondary reason why 1 other engineer got TiVo. But I would *never* have tried to explain convoluted pricing like that to them.

On the other hand I've extolled the virtues of TiVo to another engineer friend for many years. He's seen it in my house. He likes it. But he just won't buy one. He continues to use a VCR. After some people reach a certain age they just refuse to accept new technologies.


----------



## TechDreamer (Jan 27, 2002)

This isn't rocket science.
Tivo raised prices and sales went down.


----------



## jeffrypennock (May 18, 2006)

stevel said:


> There's a cardinal rule of marketing - don't undercut your channel. If TiVo sold direct for less than retailers, the retailers would simply stop carrying the product.


Is that cardinal rule of marketing still true? I ask because I don't really know squat about business aside from what I see on CNBC and the news. However, it would seem to me that in today's marketplace, their are so many points of sale, electronic and brick and mortar, that I think it's not realistic to expect that either vendors or consumers are really on top of how much a product is going for at all of its various points of sale (including directly from TiVo). I think a lot of people blindly show up at Amazon.com to buy stuff as their neighborhood BestBuy, without checking any other vendor. I think a much smaller fraction of people know whether or not Amazon or J&R is selling something cheaper on line, much like the small fraction of people who know if BestBuy or CircuitCity has something for cheaper. And today, one would have to know about all four at once...and then you've only checked with four vendors...you get my drift. Sure web crawler websites exist that supposedly list all vendors in one place but you know what they're good for. I'm just saying that in today's world, when people want things faster and easier, and in a market that has more choices, not less, if TiVo sold direct for less would really undercut the channel and cause a vendor like BestBuy to stop carrying the product?


----------



## vman41 (Jun 18, 2002)

stevel said:


> There's a cardinal rule of marketing - don't undercut your channel. If TiVo sold direct for less than retailers, the retailers would simply stop carrying the product.


If only the retailers were actually a good vehicle for showcasing the product. I only ever saw one powered on at a store once, it wasn't connected to any content sources and was showing the guided setup screen.


----------



## doormat (Sep 15, 2004)

jeffrypennock said:


> However, it would seem to me that in today's marketplace, their are so many points of sale, electronic and brick and mortar, that I think it's not realistic to expect that either vendors or consumers are really on top of how much a product is going for at all of its various points of sale (including directly from TiVo).


Consumers might not know, but BB would surely know if TiVo was selling S2 boxes online for 10% less than in store. Even if BB didnt stop carrying TiVo products, they might do more to push them to the back of the store in a dark asile somewhere.

TiVo has always been that company whos idea was great and yet never had that much presence in the marketplace. The fact that the NMP isnt working to me speaks to the idea that they should deliver high-end boxes for people who want a _real_ TiVo (and its additonal features like TTG, HME, etc), as well as develop software to put on Moto boxes for Joe Sixpack. Take the most profitable customers for yourself completely, and then deliver the "Walmart" line of your products for everyone else.


----------



## rainwater (Sep 21, 2004)

doormat said:


> Consumers might not know, but BB would surely know if TiVo was selling S2 boxes online for 10% less than in store.


Thats not the point. They can sale it for the same price or higher and still make more profit because of the direct distrubution. But instead, they basically tell current customers, "We can't help you".


----------



## Kindred (Sep 4, 2002)

I love my TiVo, but I am not buying another one. My cable company rents theirs for 15 bucks (or less) and comes with an extra section of programming. TiVo doesn't offer lifetime subscription, so they want 12 bucks or more, you have to buy a replacement unit and, of course you don't get any extra channels. It is obvious that if they keep that in tact, they will lose business. Everything I got was a 'good deal', but is no longer offered and they won't let you upgrade, so my next box will probably be the local 'cable' company box. No extra money for fixing a bad box, includes extra channels, includes the 'guide' which is accurate! So why would you pay more to get less? I find it hard to believe that TiVo hasn't snapped to this yet...

Jack


----------



## bidger (Mar 30, 2001)

vman41 said:


> If only the retailers were actually a good vehicle for showcasing the product. I only ever saw one powered on at a store once, it wasn't connected to any content sources and was showing the guided setup screen.


Was in Rat Shack last week and they had a unit on display, an 80 hr. single tuner unit I believe, and it was connected to nothing. I don't know how you're supposed to sell a device you're asking $249 for when a potential consumer can't see what it's capable of doing.


----------



## jfh3 (Apr 15, 2004)

As much as I'd like to disagree with your analysis, I can't.

And I've NEVER understood the logic of requiring a commitment on a box where the SAC has been recovered.


----------



## HDTiVo (Nov 27, 2002)

Lots of great comments!

Phantom: I actually haven't looked at the 'Plan' in my sig in 4 months, so I don't remember about the complexity, but you may be right. I do remember it needed some more work and refining, just not exactly what.

---
It seems clear Rainwater is not talking about underselling retailers. TiVo is clearly pricing above retail vis a vis MSD; just go to parity.
---

Doormat: The 'real' TiVo is another area to get into that you are right to bring up.

jfh3: I sure wish that wasn't my analysis. 

Others: in many ways I don't think retailers are a great friend to TiVo these days. Not a bad idea to talk about why, and relate it to Rainwater's comments.


----------



## jfh3 (Apr 15, 2004)

Retailers have never been a "good" friend to Tivo.

Tivo is a product that needs to be demonstrated to be understood. As long as there is no incentive for Best Buy or Radio Shack or others to do so, retail sales won't change much.

The sad thing is that just hooking up a TV could help if there was a demo mode that allowed the Tivo videos to be played without being deleted ...


----------



## HDTiVo (Nov 27, 2002)

jfh3 said:


> Retailers have never been a "good" friend to Tivo.





jfh3 said:


> The sad thing is that just hooking up a TV could help if there was a demo mode that allowed the Tivo videos to be played without being deleted ...


I have over the years seen times when retailers were "better" friends than today, when demos were hooked up to TVs and running, when TiVo had a much more visible presence on the floor, etc.



jfh3 said:


> As long as there is no incentive for Best Buy or Radio Shack or others to do so, retail sales won't change much.


I am not sure why there isn't an incentive. What is TiVo doing wrong on terms with the retailers that they don't have a financial incentive to push TiVoes?

I could understand retailers feeling sales are so low that there is no value in trying (and/or that product offerings just aren't exciting enough to try again.)

I could also understand that retailers might be unhappy with TiVo over NMP, and not interested in helping current non-NMP retail sales as well as not interested in adopting NMP. Retailing is a complex and difficult business; these retailers are not dummies; they probably see NMP for the bad idea that it is, and realize TiVo hasn't gotten the program adjusted yet even as it is designed.

It might have been better for Rogers to have had some retailing background along the line.


----------



## Phantom Gremlin (Jun 20, 2002)

Here's a _possible_ reason the retailers don't like TiVo. It has cost them too much money. Let me explain.

Electronics sales in general are quite competitive. Retail operates on a relatively low margin. They make it up by selling add-ons like monster cables and extended warranties.

But let's look at the TiVo record. S1 had lots of modem failures. Then came HD TiVo and the accompanying HDMI failures. And the hard disks used by TiVo are cheap consumer garbage, many are not capable of surviving for the duration of an extended warranty.

So my hypothesis is that the retailers have gotten killed on extended warranties. But I have absolutely no real data to back that up with!


----------



## megazone (Mar 3, 2002)

Doubful - a remarkably small number of TiVos suffer failures, and I doubt the intersection of those with failures and those who purchased extended warranties are all that large.


----------



## doormat (Sep 15, 2004)

Phantom Gremlin said:


> Here's a _possible_ reason the retailers don't like TiVo. It has cost them too much money. Let me explain.
> 
> Electronics sales in general are quite competitive. Retail operates on a relatively low margin. They make it up by selling add-ons like monster cables and extended warranties.
> 
> ...


Last I remember, those extended warranties arent even tied to the retailer - they're from an external company. BB, CC, etc gets a chunk of change for selling them, but the actual warranty policy is owned by some third party.


----------



## ZeoTiVo (Jan 2, 2004)

Phantom Gremlin said:


> I've read your ideas and I agree with things like no commitment to re-subscribe a box. It's just idiotic to require a new commitment. And it's insulting to customers to not drop the monthly cost once a commitment has expired.


that is the big sticking point on using TiVo.com alright. Bundle deals should just drop to a regular rate after they are done without requiring a new committment, that is a very raw deal. leave the comittment for those restarting one that was inactive for a while.

Also not having a bundle deal that includes the hardware factor and then either regular or MSD monthly factor is limiting as well. Show it as a factor in the same sense - kind of like the second bundle is cheaper just as with monthly MSD. If the person drops the MSD enableer from the account then the bundle price goes back up to regular. About the only hassle is that MSD bundle would have to be only monthly instead of all paid up front.

so the problem seems to be two fold - TiVo needs to make money and the yneed to ensure the bundle deals do not just drop off at the end of the bundle deal.
Also they need to keep things simple and MSD within a bundle does not make it simple.

The Standalones will become the premium over time though and the walmart variety will be the TiVo interface from the cable company.


----------



## ChuckyBox (Oct 3, 2005)

HDTiVo said:


> Most damning of all for NMP, the same quarter last year TiVo purposely attempted to not sell many boxes. Let me restate this because it is important: *MNP could not beat a period when TiVo tried not to sell boxes, despite having a long awaited new product on its side.*


You can repeat it as often as you want, but that doesn't make it true. TiVo has never "tried not to sell boxes," and the fact that you think they did demonstrates a fundamental flaw in your analysis. While in 1QFY06 TiVo had announced its intent to trade some of its growth for profitability by Q4, that CEO was replaced by the current one in Q2. In Q2 last year, TiVo's sales and marketing expense was 25% higher than the previous year, the rebate program remained in place, and among the special offers there was an offer of a free refurb unit. Gross subscription adds last year were 77K vs. 78K the previous year (a year in which TiVo was on a major subscription drive). This year the number was 74K "without any exceptional marketing or advertising spend in a very competitive environment," as Rogers put it. About the only conclusion you can draw from these numbers is that Q2 is slow for TiVo, and while they didn't do anything that changed that, their YoY sales declines continue to shrink.



> What has TiVo learned so far? According to them, they've figured out that if they lower 3yr Service by $100, many more folks pick it (50%?) and total sales increase somewhat!! (I am not sure of the exact meaning or interpretation of the statements made.)


It means that TiVo can adjust the pricing plan to balance upfront cash vs. recurring revenue -- something that is important to an unprofitable company when trying to maintain growth and solvency without taking on too much debt.



> Finally, while TiVo says online sales (now under NMP) have increased relative to retail, with the overall decline in business all that means is NMP is the lesser of the evils. Indeed, NMP itself may be the cause of some of the damage to retail sales.


Given that YoY sales were essentially flat, but the online sales have increased substantially vs. retail, you can only conclude that the "NMP" is performing better than the old plan. Even if the numbers were the same, it would be working because the subs under the new plan are more valuable to TiVo than subs under the old plan. You may call that "the lesser of two evils" but I call it an improvement in TiVo's business plan. Your thread title says that the plan is "not working," but it is only not working relative to an arm-waving argument as to what you think would work better.


----------



## lessd (Jan 23, 2005)

ZeoTiVo said:


> that is the big sticking point on using TiVo.com alright. Bundle deals should just drop to a regular rate after they are done without requiring a new committment, that is a very raw deal. leave the comittment for those restarting one that was inactive for a while.


Remember that the warranty stays on the TiVo with bundle pricing in place, I not saying its a good deal but for some it may be.


----------



## ChuckyBox (Oct 3, 2005)

jfh3 said:


> Tivo is a product that needs to be demonstrated to be understood. As long as there is no incentive for Best Buy or Radio Shack or others to do so, retail sales won't change much.


This is more or less true of any semi-complicated device at any big-box store. I doubt the sales people could do any more justice to a Slingbox or an AV receiver or a digital camera. You're more or less on your own in those places. If the TiVo marketing team wants the box explained to people, they're going to have to do it themselves. (Though one advantage of having the S3 in the lineup is that the higher margin will encourage the sales team to learn a bit more about it, and that knowledge should largely apply to the Series 2 units. It will probably be presented as an HD vs. non-HD decision.)


----------



## megazone (Mar 3, 2002)

Maybe TiVo needs to establish a team of Blue Blaze Irregulars and have 'TiVo Days' promotions at box stores. Get a deputized TiVoholic to spend some time in the store demoing the box and doing give-aways, answering questions, etc.

Yeah, I'd do it.


----------



## jfh3 (Apr 15, 2004)

megazone said:


> Maybe TiVo needs to establish a team of Blue Blaze Irregulars and have 'TiVo Days' promotions at box stores. Get a deputized TiVoholic to spend some time in the store demoing the box and doing give-aways, answering questions, etc.
> 
> Yeah, I'd do it.


I would too.

Never understood why Tivo would have an "Ambadassor" program consisting of one guy who seems to have dropped off the face of the earth. Put some training material together, design a Tivo Ambadassor polo shirt and sell it for a reasonable price, and use what's left of the Tivo die-hards to help Radio Shack and BB and others demo Tivo at "Tivo days" or something. Have SPIFs for the retail employee employees and maybe offer Tivo points for the demo people for each TSN activated or something.

Make sure the volunteers and the stores have access to table drapes, promotional material (glossy one sheets with more "What is Tivo?" detail than the traditional flyers and maybe even some promo DVDs.

IBM had an OS/2 Ambadassor program some years ago that was actually quite sucessful and ended up with a small army of employee and non-employee OS/2 fans and turned them into a pretty decent demo/marketing force outside the traditionalal sales force.

When I first got Tivo, I thought of OS/2 and that program and wondered why Tivo didn't harness the Tivo zealots to do something similar. It was always fun to see the light go on when people realized how much more OS/2 could do than Windows (at the time) - same reaction when I demo Tivo at home to people that think they already have one (cable DVR types) when they realize how much better Tivo is.

OS/2 Warp was ahead of it's time - probably doomed because of its' memory footprint when memory was incredibly expensive or because, other than the Ambadassor program, IBM couldn't figure out how to market it.

So, go for it Tivo - expand the Tivo Ambadassor program!


----------



## TiVo Troll (Mar 23, 2006)

jfh3 said:


> Tivo is a product that needs to be demonstrated to be understood.


No matter how well TiVo's features are demonstrated there are just too many oh-so-clever TiVo features for mass market users to care about.

TiVo Central offers a cluttered mess of features, many of which are just advertising pitches in disguise.


----------



## MiamiTV (Apr 8, 2003)

Bring back the lifetime service plan at 400.00.


----------



## rainwater (Sep 21, 2004)

MiamiTV said:


> Bring back the lifetime service plan at 400.00.


And that would help TiVo how? You can already get 3 years of service for much cheaper than that anyways.


----------



## MickeS (Dec 26, 2002)

TiVo Troll said:


> No matter how well TiVo's features are demonstrated there are just too many oh-so-clever TiVo features for mass market users to care about.


But in a store, these features would make great showcase points. For example, set up a small network and show how TiVo can store and retrieve shows from a PC. You could probably even use some of the third party software like Videora and Galleon to show how the TiVo can be part of the network.

I'm just speaking from my own experience - if I see a feature that Imight not use very often, but nevertheless seems cool and useful, I will be more likely to buy that product than the competitor without it. Ithink that in a store, this could be a sellingpoint targeted at those who have or are considering a cable DVR.

As for the rest of the messages inthis thread, I don't know what would be right or wrong, good or bad... but I know that this quote is spot-on:


Phantom Gremlin said:


> It would be far too charitable to describe their marketing as inept.


TiVo has had the most pathetic excuse for "marketing" I've ever seen. I'd love to see the numbers for the return on the money they spent on the "TiVo Ambassador" crap.


----------



## vman41 (Jun 18, 2002)

MickeS said:


> But in a store, these features would make great showcase points. For example, set up a small network and show how TiVo can store and retrieve shows from a PC. You could probably even use some of the third party software like Videora and Galleon to show how the TiVo can be part of the network.


I'm afraid that's too complicated for the people staffing a big box store to manage.
How about you just hook a TiVo up to a specially programmed PC with the serial cable, ethernet cable, and s-video/audio cables. The TiVo would then see this PC as its internet connection and the PC would locally provide the download servers to drive guided setup. The PC would also pretend to be a cable settop box with say 24 hours of programming spread over 3 channels scheduled in a loop. The PC monitor would show the 'live' broadcast of the currently selected channel so you can see what is being recorded while you what something else. The PC would naturally have the standard HMO services running as well.

The idea is that is it completely standalone and relatively easy to setup.


----------



## kb7oeb (Jan 18, 2005)

Years ago I used to work at CompUSA and Apple had a similar deal where they got mac fans to come in and help sell their product but I never understood why anyone would want to give up their weekend to help sell someone elses product for free.


----------



## sonicboom (Sep 2, 2006)

kb7oeb said:


> Years ago I used to work at CompUSA and Apple had a similar deal where they got mac fans to come in and help sell their product but I never understood why anyone would want to give up their weekend to help sell someone elses product for free.


The same reason why people feel compelled to go to church on Sundays...

Religion


----------



## MediaLivingRoom (Dec 10, 2002)

I can say that ever since the NMP, I have not gotten any of my friends and family to join TiVo. Yes, I could still tell them to buy it at Best Buy and sign up for service etc... It's just clear to people who read teh details of the plans, a new user who buys from TiVo.com will pay a higher price. I can't lie to my friends when they ask me "if I buy on line at TiVo.com, is that a good deal??" I say hell no!!


----------



## ChuckyBox (Oct 3, 2005)

MickeS said:


> I'd love to see the numbers for the return on the money they spent on the "TiVo Ambassador" crap.


I doubt the contest was particularly expensive -- the prizes offered were less than $100K and the time used by the TiVo staff would be fairly minimal. In return, all of the entrants had to sell some TiVo subscriptions, and TiVo got some publicity and a bunch of funny, clever videos that might help the marketing team focus the message in future advertisements.


----------



## megazone (Mar 3, 2002)

MediaLivingRoom said:


> I can't lie to my friends when they ask me "if I buy on line at TiVo.com, is that a good deal??" I say hell no!!


I think the bundles are pretty damn good deals. Better than buying at retail. Especially the 3-year bundle.


----------



## megazone (Mar 3, 2002)

jfh3 said:


> So, go for it Tivo - expand the Tivo Ambadassor program!


What ever happened to their Ambassador anyway? He made *2* blog posts and has never been heard from again. What's up with that? I mean, if there is a good reason, why not tell the community? If he had a family crisis, accident, etc, that's quite understandable. But the way it stands now it looks like it just failed. It actually makes me a bit angry because there are so many people who would have put effort into being an Ambassador and if he won and then just bailed, that's weak.


----------



## infinitespecter (Jul 23, 2004)

kb7oeb said:


> Years ago I used to work at CompUSA and Apple had a similar deal where they got mac fans to come in and help sell their product but I never understood why anyone would want to give up their weekend to help sell someone elses product for free.


I used to do that, and it wasn't free by any means. We got paid over a hundred bucks for those few hours of work. It was through Marketsource for Apple, and it was a lot of money when you are a college student, and I enjoyed it.


----------



## ChuckyBox (Oct 3, 2005)

megazone said:


> It actually makes me a bit angry because there are so many people who would have put effort into being an Ambassador and if he won and then just bailed, that's weak.


You get some torches and pitchforks, I'll round up a mob of peasants.


----------



## megazone (Mar 3, 2002)

ChuckyBox said:


> You get some torches and pitchforks, I'll round up a mob of peasants.


This is so much more humorous because your icon makes me 'hear' your posts as if voiced by Brock Sampson. ;-)


----------



## ZeoTiVo (Jan 2, 2004)

infinitespecter said:


> I used to do that, and it wasn't free by any means. We got paid over a hundred bucks for those few hours of work. It was through Marketsource for Apple, and it was a lot of money when you are a college student, and I enjoyed it.


I would sell TiVo in stores on the weekend for a couple hundred bucks. An easy job selling something your love to use yourself.


----------



## mattack (Apr 9, 2001)

jeffrypennock said:


> I think a much smaller fraction of people know whether or not Amazon or J&R is selling something cheaper on line...


I would suspect they do know, because they can't get free shipping when J&R is the supplier!


----------



## mattack (Apr 9, 2001)

rainwater said:


> And that would help TiVo how? You can already get 3 years of service for much cheaper than that anyways.


Lifetime >> 3 years.


----------



## mattack (Apr 9, 2001)

BTW, did anybody mention lifetime on the conference call?


----------



## dkroboth (Jan 25, 2002)

ChuckyBox said:


> You get some torches and pitchforks, I'll round up a mob of peasants.


I'm temporary living San Diego where he supposedly is. My wife has volunteered to hunt him down and force him to come to our theorized Series 3 release party.


----------



## ZeoTiVo (Jan 2, 2004)

mattack said:


> BTW, did anybody mention lifetime on the conference call?


 yah, they said "Not in our lifetime!?"


----------



## HDTiVo (Nov 27, 2002)

mattack said:


> BTW, did anybody mention lifetime on the conference call?


Yes. An analyst wanted to know where TiVo would get its cash without Lifetime sales.

TiVo said the tweaking of the 3 yr pre-pay price was helping in that respect.

Edit: Oh, and I guess they are getting it from floating more stock.

Good points about the in store TiVo Evangelists and single Ambassador.


----------



## jfh3 (Apr 15, 2004)

megazone said:


> What ever happened to their Ambassador anyway? He made *2* blog posts and has never been heard from again. What's up with that? I mean, if there is a good reason, why not tell the community? If he had a family crisis, accident, etc, that's quite understandable. But the way it stands now it looks like it just failed. It actually makes me a bit angry because there are so many people who would have put effort into being an Ambassador and if he won and then just bailed, that's weak.


I agree. I guess you missed this part of my post:

"Never understood why Tivo would have an "Ambadassor" program consisting of one guy who seems to have dropped off the face of the earth."


----------



## megazone (Mar 3, 2002)

jfh3 said:


> I agree. I guess you missed this part of my post:


No, I didn't miss it, I was just saying the same thing.


----------



## HDTiVo (Nov 27, 2002)

HDTiVo said:


> Yes. An analyst wanted to know where TiVo would get its cash without Lifetime sales.
> 
> TiVo said the tweaking of the 3 yr pre-pay price was helping in that respect.
> 
> Edit: Oh, and I guess they are getting it from floating more stock.


Edit: Oh, and I guess they are getting it from Lifetime S3 sales.


----------



## ZeoTiVo (Jan 2, 2004)

HDTiVo said:


> Yes. An analyst wanted to know where TiVo would get its cash without Lifetime sales.


actually I have thought more about the idea of dropping legacy hardware and that hardware either no longer having to be supported or just as likely being picked up by others and subscribed.

coupled with the hardware being more costly now it would make sense to offer a lifetime transfer for some fee to give TiVo a quick influx of cash while still covering the overall cost of an s3 plus profit over whatever time period TiVo deems feasible.
I think it would actually make sense - kind of like reselling lifetime for those that already have it anyway. I bet it would drop a *lot* of series 1 off lifetime and make the lifetime subscriber base more manageable going forward


----------



## HDTiVo (Nov 27, 2002)

ZeoTiVo said:


> it would make sense to offer a lifetime transfer for some fee to give TiVo a quick influx of cash


You thought  of this all by yourself?


----------



## ZeoTiVo (Jan 2, 2004)

HDTiVo said:


> You thought  of this all by yourself?


 since you asked I actually posted this here, hit submit and then saw the thread on $199 transfer. 
and yes it was all the posting yesterday by you and others on this that got me thinking about the angle of how it would drop legacy hardware off lifetime which was a pretty positive factor for TiVo - made me rethink it in that light.

from a post the day before this post 


ZeoTiVo said:


> it would give them heartburn and not directly up the total subscription numbers but - it would drop off some older legacy hardware or else some would go monthly. That is a benefit they can factor in.
> 
> I have a 240 lifetimed and do not plan to buy an S3 right away but if that offer was put out there I would spend more than a little time mulling it over. If I had a series 1 lifetimed I would not hesitate at the chance to update it.
> 
> ...


----------



## HDTiVo (Nov 27, 2002)

It happens to all of us.


----------



## classicX (May 10, 2006)

bidger said:


> Was in Rat Shack last week and they had a unit on display, an 80 hr. single tuner unit I believe, and it was connected to nothing. I don't know how you're supposed to sell a device you're asking $249 for when a potential consumer can't see what it's capable of doing.


Tivo should have a "demo" mode, which may consist of continously playing a stored video showcasing the product. And in that case, they could just send a VHS or DVD containing this video to retailers for display.

Other than that, I don't see how having one "on display" would ever compel a customer to check it out. There is nothing inherently interesting about a Tivo when someone is not doing something with it - it may very well be live TV, how could you tell?

And good luck getting users to test it out when the remote is bolted to the table.


----------



## classicX (May 10, 2006)

MickeS said:


> But in a store, these features would make great showcase points. For example, set up a small network and show how TiVo can store and retrieve shows from a PC. You could probably even use some of the third party software like Videora and Galleon to show how the TiVo can be part of the network.


ROFL

In a retail store, a product has only a few _seconds_ to grab your interest. Aside from the added cost of setting up something like this, do you really expect a busy retailer like BB to stop selling their thousands of other products to have someone sitting at a computer transferring files all day?


----------



## MickeS (Dec 26, 2002)

If you have to sit by your computer while it's transferring files, I suggest you learn to do it a different way.

And BB has demos and displays from third party vendors all the time.


----------



## HDTiVo (Nov 27, 2002)

ChuckyBox said:


> You can repeat it as often as you want, but that doesn't make it true. TiVo has never "tried not to sell boxes," and the fact that you think they did demonstrates a fundamental flaw in your analysis. While in 1QFY06 TiVo had announced its intent to trade some of its growth for profitability by Q4, that CEO was replaced by the current one in Q2. In Q2 last year, TiVo's sales and marketing expense was 25% higher than the previous year, the rebate program remained in place, and among the special offers there was an offer of a free refurb unit. Gross subscription adds last year were 77K vs. 78K the previous year (a year in which TiVo was on a major subscription drive). This year the number was 74K "without any exceptional marketing or advertising spend in a very competitive environment," as Rogers put it. About the only conclusion you can draw from these numbers is that Q2 is slow for TiVo, and while they didn't do anything that changed that, their YoY sales declines continue to shrink.
> 
> It means that TiVo can adjust the pricing plan to balance upfront cash vs. recurring revenue -- something that is important to an unprofitable company when trying to maintain growth and solvency without taking on too much debt.
> 
> Given that YoY sales were essentially flat, but the online sales have increased substantially vs. retail, you can only conclude that the "NMP" is performing better than the old plan. Even if the numbers were the same, it would be working because the subs under the new plan are more valuable to TiVo than subs under the old plan. You may call that "the lesser of two evils" but I call it an improvement in TiVo's business plan. Your thread title says that the plan is "not working," but it is only not working relative to an arm-waving argument as to what you think would work better.


Chucky: I am away from may 'data' all this week, but I checked out these things:

Old CEO was in place for Q1 Earnings release late May '05; Rogers didn't start until well into Q2 then, meaning Q2 reflected Old CEO (I do not speak the name) strategy. I even have a vague memory of you saying Q3 was affected by prior strategy. Do you remember?

S&M increase 10% YOY for Q2, a few % even taking out option effect.

Rebates, etal, increased about 66% YOY. Even allowing for channel fills this year, I'd like to see some real data showing that line was effectively below last year's.

Remember this  comment from Rogers:



ChuckyBox said:


> Interesting.
> 
> He said they got "3, 4, 5 times" the conversion rate with the $16.95/month, no upfront cost offer than they get with the traditional $12.95/month, buy the box offer. That's a pretty significant finding. And it sounds like that offer is coming to a retailer near you very soon.
> 
> (The "conversion rate" is the percentage of people who call up with an interest in TiVo who actually end up signing up.)


If Roger's etal knew what they were talking about back then, why didn't NMP boost business significantly over last year without any extra effort?

Perhaps not a complete direct answer to you, but something to chew on.


----------



## ChuckyBox (Oct 3, 2005)

HDTiVo said:


> Old CEO was in place for Q1 Earnings release late May '05; Rogers didn't start until well into Q2 then, meaning Q2 reflected Old CEO (I do not speak the name) strategy. I even have a vague memory of you saying Q3 was affected by prior strategy. Do you remember?


Sure. But there are things that can be done quickly and things that take time. Q3 and Q4 were helped by Rogers' rebate (though it came fairly late in Q3), and they were hurt by a lack of inventory (a legacy of the previous CEO that couldn't be corrected quickly). Holiday sales could have been better if they could have advertised more, but the inventory shortage prevented that. IIRC, Amazon.com actually ran out of boxes a few days before Christmas.

My point was just that there were discounts and rebates available last Q2, some of which may have been Rogers' doing, and sales were not terrible. (Q3 was another story.)



> S&M increase 10% YOY for Q2, a few % even taking out option effect.


Given that the cost of living goes up by a few percent every year, and TiVo now has more people on staff, and there is the impending S3 launch to prep for, I would bet that advertising spending was actually lower this Q2 than last.



> Rebates, etal, increased about 66% YOY. Even allowing for channel fills this year, I'd like to see some real data showing that line was effectively below last year's.


This is always a problem when looking at TiVo's numbers -- it is very hard to sort out what is what in the hardware world. But there is a 50% bigger rebate this year than last, and they had to fill the Radio Shack channel (but saw no sales from that channel), and they apparently actually sold more boxes this year than last (since subscription adds were lower, I assume the difference was people replacing their single-tuner units for dual-tuner units), I'm not surprised by the increase in rebate expense.



> If Roger's etal knew what they were talking about back then, why didn't NMP boost business significantly over last year without any extra effort?


I think it did, but it is probably lost in a number of other factors. Online sales are up significantly as a percentage of overall sales, despite very few signs of marketing the new pricing plans since they were launched. And, as I said, total box sales were actually up, we just don't know by how much. And given that the expectation is generally falling sales due to competitive pressure, coming that close to last year's numbers might represent a huge improvement in conversion rate, but not show up as an increase in total sales.

But my guess it that it isn't doing that much because they have yet to advertise it aggressively. It sounds to me like they want to get their advertising message and pricing plans as resolved as possible so they can hit the market hard and when it will do the most good. Rogers said we'd see ads by the end of Q3, so we'll see if that's what happens.


----------



## HDTiVo (Nov 27, 2002)

ChuckyBox said:


> Sure. But there are things that can be done quickly and things that take time. Q3 and Q4 were helped by Rogers' rebate (though it came fairly late in Q3), and they were hurt by a lack of inventory (a legacy of the previous CEO that couldn't be corrected quickly). Holiday sales could have been better if they could have advertised more, but the inventory shortage prevented that. IIRC, Amazon.com actually ran out of boxes a few days before Christmas.
> 
> My point was just that there were discounts and rebates available last Q2, some of which may have been Rogers' doing, and sales were not terrible. (Q3 was another story.)
> 
> ...


Agreeing with what you said about factors in S&M and Rebates, there's no clear sign that the overall effort was much less (and the absolute numbers are higher).

For online, I don't remember more signs of marketing online previously relative to recently, so that seems like its in the push range too. They did have some deals this summer. And don't forget canabalisation from retail and pissing off retail partners. Just because the online mix increases doesn't mean its good overall. Retailers have obviously not joined NMP in its early forms as originally hoped.

I get what you say about conversion rate, but don't forget the advantage of the DTs this year.

Sure NMP will start doing better when they start advertising - god I hope so! How much more do they have to push up SAC?

Sure NMP will do better as they tweak the prices - towards what I said they needed to be originally. Rogers alluded to NMP in the 8/24/05 earnings release. I hope he didn't get out of bed that morning and first think about it. It took them probably 8-9 months to go from idea to launch, and its another 5.5 months into operation. That's rediculous.

I think we can both say OMP was junk. Whether NMP has been a little better or worse, its still pretty much been junk. And that deserves the label 'Not Working.'


----------



## classicX (May 10, 2006)

MickeS said:


> If you have to sit by your computer while it's transferring files, I suggest you learn to do it a different way.
> 
> And BB has demos and displays from third party vendors all the time.


This is the sound of you missing my point... WOOOOOSH!


----------



## HDTiVo (Nov 27, 2002)

I forgot about the selling more boxes...

Does selling more boxes really mean more to the end user or just more to the channel?

Does selling more boxes and less Gross Adds mean more 30 trial cancellations or something else like funky timing between sales and registration?


----------

