Posts Tagged ‘revenue’

Hawaii Pushes the “Emergency Marketing” Button

Wednesday, April 6th, 2011

We all know by now how much the earthquake and ensuing tsunami in Japan have affected its economy and the foreign companies that depend on Japanese-made components for their products.

But something we hadn’t really thought enough about is how the disaster affects where Japanese people choose to spend their money. It seems obvious now, but Japanese tourism to Hawaii has dropped by a full 25% since March 11th. That’s a big deal for the Hawaiian tourism industry, which is now spending $3 million on “emergency marketing” to woo travelers from other nations.

See what happens when you put all your eggs in one basket? Diversity really is more than just a corporate buzzword. (Full disclosure: we hate the word “buzzword.”) In work, school, government, AND your investment portfolio, diversification can protect you from unpredictable events and their domino effects.

Fortunately, Hawaii still has plenty of appeal to pasty New Yorkers like ourselves, who are happy to contribute to the state’s critical tourism revenue stream.

Barring an unforeseen volcanic eruption, that is.

What to Do When Your Business Model Depends Entirely on Google’s Search Results

Wednesday, March 9th, 2011

“In a recent e-mail to employees, company founder and CEO Jason Calacanis and Mahalo President Jason Rapp said the start-up trimmed a tenth of its workforce due to a reduction in traffic caused by Google’s change to its search algorithm, according to the blog CenterNetworks.

The Google changes were meant to push down low-quality sites in search results, but some unexpected websites such as Mahalo lost their ranking as well, the report said. With less traffic visiting Mahalo, revenue took a hit, the e-mail said, according to CenterNetworks.”

What do you think?

How can online businesses protect themselves against rapid changes in the technology industry? Does this news make you think twice about investing in web-based companies?

Aging Giant Kodak Turns To Lawsuits For Revenue

Wednesday, February 16th, 2011

kodak-instamatic.jpg
photo credit: joost j. bakker

Kodak used to be King of Cameraland, but then the digital boom destroyed the darkroom. What happens to a successful company when its industry all but disappears?

  • As the end of the film camera approached, Kodak changed its focus to digital technology and printers. But it’s been a long, hard road.
  • Kodak products aren’t flying off the shelves these days, but the company does have one huge thing going for it: It owns more than 1,000 patents on digital imaging technology.
  • Kodak technology is behind almost all digital cameras produced today – including iPhones and Blackberries.
  • That’s no small thing, so Kodak has been fighting hard for its share of digital imaging profits. It’s currently suing Apple and Research in Motion (which makes the Blackberry) over alleged patent infringement.
  • The U.S. International Trade Commission just ruled that Apple and Research in Motion did not violate any patents, but Kodak is going to keep fighting. What else can it do?

Facts & Figures

  • The Eastman Kodak Co. is 130 years old
  • Kodak has successfully negotiated $550 million in royalties from Samsung and $414 million from LG Electronics

Best Quote

“We fully expect the ITC commission will ultimately rule that the patent claim at issue is valid and infringed by Apple and RIM.” – Laura Quatela, Kodak’s chief intellectual property officer

What do you think?

Can you think of any old giants like Kodak that have reinvented themselves to be successful today?

Why does the price of a plane ticket change so much?

Friday, January 8th, 2010

Have you ever gone online to find that the price of an airline ticket has doubled since last night? Airline prices remain a mystery to most, but there are basically three major factors that influence the variable price tag:

Yield Management - This is a complicated computer-based model that constantly adjusts the prices of the remaining inventory of tickets to yield the greatest dollar amount for the remaining seats. (Pretty smart, huh?) The program uses many inputs including historical booking patterns, demand, market competition and events in the market to squeeze as much revenue as possible from every seat.

Competition - If American Airlines is competing against U.S. Air, or Delta, their prices will stay similar because all of these major airlines use similar yield management software. But if they’re up against a low-cost provider like JetBlue, they’ll have to adjust their prices for the effected flight routes in order to stay competitive.

Cost - This is lowest priority in setting prices since the going rate for seats, availability of aircraft, and customer demand are all ultra-sensitive to fluctuating markets. Often, airlines are not able to pass their costs onto customers because, well, there are always other means of transportation if flying is too expensive.

While airline prices are going to fluctuate dramatically, understanding the fluctuations can help you book the best plane ticket, and get a good deal. You can also try sites like kayak.com and others, which show you the average prices over time for the flight you’re planning.

Revenue is…

Wednesday, October 14th, 2009

Revenue is the total amount of money received for a service or sale. For example, if you were to sell 100 apples on the street for $1 each, your revenue would be $100.

Net Income is…

Wednesday, October 7th, 2009

Net income is the income that remains after subtracting all costs, expenses, and taxes. For example, if your frozen banana stand made $100 today but you had to spend $35 on bananas and then $5 in taxes, your net income would be $60 ($100 income – $40 costs).

Gross Earnings are…

Wednesday, July 29th, 2009

Gross earnings are the total taxable income or revenue of an individual or a company before adjustments are made. In other words, if an individual earns $70,000 a year before taxes, that number represents her gross earnings. For publicly traded companies, gross earnings refers to total profit after the cost of goods and services has been deducted.

Profit is…

Wednesday, June 17th, 2009

Profit is the positive monetary gain after subtracting the amount earned and the amount spent over the course of a period of time.  For example, if you bought a pair of sneakers for $80 and then sold them on eBay for $120, your profit would be $120 (income) – $80 (expense) = $40 (profit).

Craigslist – If Only It Were *Your* List

Friday, June 12th, 2009

Interested in web businesses? Here’s a great example of a traditional industry that is able to thrive online, while its offline counterparts aren’t faring so well.

  • Craigslist is a free classified website that only charges for certain services in major U.S. cities.
  • It is a private company that does not disclose profits or revenue and so consulting companies frequently have to estimate these numbers.
  • While the newspaper and print classified ad industries have been downsizing, Craigslist has been bringing in record revenue.

Facts & Figures

  • Craigslist’s estimated revenue for 2009 is $100 million – a 23% increase from 2008.
  • In newspapers, classified advertising declined by 29% in 2008.
  • Craigslist is on track to generate $17.7 million in New York City alone in 2009.

Best Quote

“This is a down-market for just about everyone else but Craigslist.” – Jim Townsend, Editorial Director of AIM Group