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What is Amazon? Whatever Amazon wants to be

Thu, 2014-06-12 13:04

When Amazon Prime launched in 2005, it was just a way to prepay for two-day shipping. Since then, many of the things customers used to get delivered—books, music, and movies—are now digital files. 

So, Amazon has been adding other benefits to Prime, like streaming movies, and starting this week, music. Critics say its new Amazon Music is far from the most expansive or current list of songs, but it’s another way Amazon is trying to infuse itself into our lives and become the first place we spend our money.  

This is also part of a big transformation in what, exactly, Amazon is. 

 “The company has reached out and become a true platform. It has both the hardware and software offerings," says Colin Gillis, director of research at BGC Financial. 

Amazon builds its own Kindles and has its own smartphone coming out next week. It may even become a delivery company, cutting out UPS and the Post Office. And, its servers—called Amazon Web Services—host many of its competitors, including Netflix. 

“Who would have thought that Amazon is running some major 30-40 percent of the internet and now running data storage for the United States government,” says  Dave Selinger, the former manager of Amazon’s customer behavior research and site optimization. He’s now CEO of RichRelevance. 

Amazon’s servers will host a revamped HealthCare.gov. Selinger says Amazon, at its core, is whatever its founder Jeff Bezos wants it to be. 

“If he believes he can do something better, faster or cheaper, you can expect he will, at the very least, think long and hard about whether he’s going to do that,” Selinger says.  

That’s why you hear rumors of Amazon taking on Angie’s List and Yelp. 

“I view it as a company that simply won’t cede any ground on the internet,” says Brad Stone, who wrote the book about Amazon called "The Everything Store". 

Amazon is willing to lose millions of dollars on experiments like selling groceries, just to ensure it’s the first place we shop. 

“They think they can do it all better,” Stone says. 

That’s even if early reviews say Amazon Music is just OK. 

Is E3 actually mind-blowing?

Thu, 2014-06-12 13:00

I came to E3, the video game industry’s annual convention, with the hope of having my mind blown. The tag line of this year’s event is "The Future Revealed." This is the year that the promise of virtual reality was going to be revealed.

Even before I entered the convention hall in Los Angeles, people were raving about VR goggles. “It’s crazy! You get a little bit of motion sickness, but wherever you look you are in the game,” said a very enthusiastic Skylar Harper.

I was excited to try on a pair of VR goggles, and I did, and it was cool, but it didn’t blow my mind, and I wasn’t alone.

“I think VR is really cool and closer to being a thing,” said Justin McElroy, managing editor of the gaming site Polygon. But he also found VR to be a little scary. His great fear of VR, and fear of video games in general, is that they can be an isolating experience.

“When I look at something like VR, it is not a social experience. Almost by definition you are closed out from the rest of the world, and there is a place for that in gaming sure, but I worry about the effect and the cost of that. I don’t know that we need to be more cut off from everybody and everything.”

Polygon managing editor Justin McElroy posing in his makeshift E3 work space with Paris Hilton and Brandy.

David Weinberg/ Marketplace

My next stop at the convention was a giant, 180-degree, wraparound movie screen. I was there to see the trailer for "Destiny," the most expensive video game ever made. At $500 million, its budget is nearly double that of "Spider Man 3," which holds the record for the most expensive movie ever made. The trailer had lots of cool alien monsters but nothing mind-blowing.

Afterwards I wandered over to a giant poster of Jesus holding an Xbox controller. It was an ad for gamechurch.com. “We really think that gaming is more than just a fun thing to do," said Gamechurch.com founder Michael Bridges. "It speaks to the human condition, and we’re speaking through a Christian lens, but we're not doing it in a judgmental way. We’re not the morality police.”

I asked him what he thought Jesus’s favorite video game would be. “Your favorite game,” he said without hesitation, “because he wants to play with you.  You know, he just wants to hang.”

David Weinberg/ Marketplace

After talking to Bridges I heard a rumor that the videogame "Gauntlet had a food truck" parked outside and was handing out free turkey legs. The rumor was true. I watched a man devour a piece of charred meat about the size of his head. Next to him, a life-size tank was rolling over a taxi cab.

It was kind of mind blowing.

Much of E3 now consists of watching other people play video games.

David Weinberg/ Marketplace

Call it 'protein', not 'meat'

Thu, 2014-06-12 12:29

General Mills launched a new cereal: Cheerios Protein. The big selling point: It contains eleven grams of protein when paired with milk.

So what is it about protein that drives consumers to add so much of it into their diets -- and spend so much on it in grocery stores?

"Protein helps you feel full throughout the day and keeps you energized," says Venessa Wong, associate editor at Bloomberg Businessweek. "It actually works out in favor of food manufacturers," says Wong. "Consumers are so interested in protein and yet have no idea how much they’re supposed to consume a day."

No surprise there because in business, it’s all about the branding. For instance, meat companies, like Pilgrim’s Pride and Tyson, prefer to think of themselves as a "protein company" as opposed to a "meat company."

"Last year, a data company found that conversations that mentioned meats were highly negative on social media," says Wong. "Where as those that mentioned proteins were associated with positive things like good, delicious and healthy."

So will the protein popularity grow? Or is this just another fleeting food trend?

"It’s a hot trend," says Wong. "Several companies are making bets on the marketing power of protein to consumers."

Listen to our full interview with Venessa Wong in the audio player above.

5 examples when the word "protein" does not mean "meat"

Via Wikimedia Commons

1. Brussels Sprouts

Nobody ever wanted to eat them when they were kids, but these little miniature cabbages pack a solid three grams of protein in each 1-cup serving.

Aizar Raldes/AFP/Getty Images

2. Quinoa

It's not technically a grain (it's a seed), but it has as much protein as some other whole grains and then some. One cup of quinoa contains a whopping 24 grams of protein--nearly five times that of a cup of brown rice.

Via Wikimedia Commons

3. Pumpkin seeds

Might want to save the seeds from your next Halloween pumpkin. Also called "pepitas" in Spanish, pumpkin seeds boast a hefty 12 grams of protein per cup. There's a caveat, however, as nuts and seeds tend to pack a lot of calories and fat along with them.

David Paul Morris/Getty Images News

4. Ice cream

Again, the usual moderation caveats apply, but the National Dairy Council reports ice cream is not only a source of protein, but also calcium, riboflavin, and other vitamins and minerals. But don't use this to justify your consumption of it--while a half-cup of chocolate ice cream contains 2.5 grams of protein, it also comes with 7 grams of fat.

Via Wikimedia Commons

5. Silk pupae

Called beondegi in Korean--which translates to "pupa" or "chrysalis"--steamed and lightly seasoned silkworm pupae are often sold by street vendors in Korea. Canned silk pupae can contain up to nine grams of protein.

A famous London bookstore hits back at digital trends

Thu, 2014-06-12 12:04

Amazon and the e-book have spelled doom for many bookshops, especially in the U.S. and the U.K. Hundreds have closed. But tomorrow in London, one of the world’s best known bookstores defies the trend: Foyles on Charing Cross Road is officially opening a new $60 million flagship store. Can it survive the digital onslaught?

“Some people think we’re mad. Some people think we’re very brave. Some people think we’re now going to reverse the trend back towards physical books and bricks and mortar book retailing, ” says Christopher Foyle, grandson of one of the store’s founders and the current chairman.

The early signs are encouraging. Even before the official opening, the new, four story bookshop was full of book-loving customers.

"I do love the atmosphere of bookshops... the calmness,” says Nina Muehlemann. "I feel it’s a luxury spending time here."

Simon Shaw said shopping in a book store is far more satisfying than doing it online. “It’s the serendipity of coming across something that you didn’t know you were looking for,” he said.

And Lila Burkeman spoke of her preference for the printed word: “I love books,” she said. “ I do have a computer, but there’s nothing like holding a book in your hands.”  

Some publishing industry observers claim that these physical book lovers are a vanishing breed, and that eventually e-books will command a 95 percent share of the market. But Patrick O’Brien of Verdict Retail research isn’t so sure.

“We are seeing that the e-book market is really starting to mature already.” he says. “ So we do not believe that it’s going to destroy the physical book market in the near term. We think it could end up with a 50/50 split”

Foyles is calling its new flagship store “ the traditional bookshop of the future”. Ironically, since digital technology has been eating into its business, the company has equipped the new store with state-of-the-art digital equipment – including a smartphone system for guiding customers to the book they’re looking for. Christopher Foyle believes that high-tech and tradition will prove an irresistible combination, although there is one tradition he is eager to stamp out. Such was the chaos and the clutter of the old store, such was its status as a national institution , that book stealing became endemic and even respectable.

“I’ve even got a letter in the archive from one academic gentleman who bitterly resented being prosecuted for stealing vast quantities of books. He thought it was his right – as a poor academic – it was his God-given right to steal as many books from us as he possibly could,” says Foyle.

The new store is bristling with the latest security and surveillance equipment. Technology – a threat to physical books and bookshops – is fully deployed throughout the store to combat theft.

Tech companies don't just recruit from the Ivies

Thu, 2014-06-12 11:17

If you think working for a big technology  company like Microsoft, Apple or IBM, requires attending an Ivy League school first, you might want to think again.

Turns out, tech companies recruit their employees from a variety of different universities and state colleges.

 "Yahoo’s top place where it gets its workers from is actually San Jose State University," says Joanna Pearlstein, deputy managing editor at Wired Magazine. "And it’s also the top supplier of workers to  Apple."

@kairyssdal: Top schools for APM staff: U. Minn., USC, St. Olaf. NPR: U. Maryland, Berkeley, American. NY Times: NYU, Columbia, Harvard

— Joanna Pearlstein (@jopearl) June 12, 2014

Pearlstein’s research also shows that four out of five of the top universities that Microsoft is getting its employees from are located in the Washington state.

Check out Wired's breakdown of what colleges feed the big tech companies:

Luca Masud and Brittney Everett/Wired

Tech companies don't just recruit from the Ivies

Thu, 2014-06-12 11:17

If you think working for a big technology  company like Microsoft, Apple or IBM, requires attending an Ivy League school first, you might want to think again.

Turns out, tech companies recruit their employees from a variety of different universities and state colleges.

 "Yahoo’s top place where it gets its workers from is actually San Jose State University," says Joanna Pearlstein, deputy managing editor at Wired Magazine. "And it’s also the top supplier of workers to  Apple."

@kairyssdal: Top schools for APM staff: U. Minn., USC, St. Olaf. NPR: U. Maryland, Berkeley, American. NY Times: NYU, Columbia, Harvard

— Joanna Pearlstein (@jopearl) June 12, 2014

Pearlstein’s research also shows that four out of five of the top universities that Microsoft is getting its employees from are located in the Washington state.

Check out Wired's breakdown of what colleges feed the big tech companies:

Luca Masud and Brittney Everett/Wired

Getting tickets for the NBA Finals is a game itself

Thu, 2014-06-12 10:47

For Miami Heat season ticket holders, the NBA Finals should be all LeBron jerseys and cocky tweets.

After all, the Heat are one of just four teams to ever play in four straight NBA Finals. And season ticket holders have first crack at snagging highly-coveted playoff tickets and buying them at a relative steal.

“The Eastern Conference Finals will generally go for anywhere from three to four times face value,” says Ayeh Ashong with Miami-based broker Tickets of America. “And the NBA Finals can go for anywhere from four to five times face value.”

Season ticket holders can cover a good chunk -- if not all -- of their expenses by selling just their conference finals and finals tickets. Depending on where NBA Finals seats are located, says Ashong, tickets can sell for anywhere from $275 to $25,000.

For a subset of season ticket holders, the playoffs becomes a complicated affair. Like a timeshare, some fans join informal season ticket pools with colleagues, friends, and friends of friends.

Ashong says at least twice a year, he turns into a counselor for group season ticket holders. There’s an extra playoff game left. Who gets to go? Should they just sell the seats and split the money?

“Oh wow, we’ve done all kinds of things,” says Ayeh Ashong with Miami-based broker Tickets of America, “from pulling straws to flipping coins.”

Perhaps the easiest way to fairly break up playoff tickets is to liquidate them all and split the profits among the group.

But many season ticket holders, like Gregg Gelber, wouldn’t dream of selling their seat to a stranger. He and six long-time friends share four season tickets. “Like everything with our group, it starts with a spreadsheet,” says Gelber, a financial advisor who keeps obsessive records of who attends which game.

For the playoffs, Gelber’s group uses a rotation system to distribute playoff seats. An order is randomly generated, and each group member gets a ticket when his name is up. Four of the seven guys go to each game this way.

Over the last four years, the group has developed a small bible of playoff-specific rules.

“Giving your ticket to anybody without prior approval is complete banishment,” says Gelber. “Immediately.”

Group members are also prohibited from selling their ticket. “If you can’t go, you can offer to trade. If that is rejected... it goes to the next person automatically,” says Gelber.

In Gelber’s rotation system, all of the group members have the same chances of getting any given ticket. That is one way to think about “fairness.”

But there’s at least one other way. “A property that mathematicians call ‘envy free-ness,’” says Mike Rosenthal, who teaches math at Florida International University.

Rosenthal suggests splitting up season tickets with a method that originated as a way to divvy up an estate when no will had been written:  the Knaster system.

“[It] was developed during World War II,” says Rosenthal, “by a Polish Mathematician: Bronisław Knaster.”

Using the Knaster system, each ticket holder would write down what a given game is worth to them. The person who values a game most gets the ticket, but has to reimburse the other members for not going.

And then there’s the Peltz family system. Which is to say no system, really.

The Peltzs have owned a pair of Heat season tickets for about two decades, since their kids were just babies. Now that the Heat are a regular fixture in the Finals, and the kids are adults, there’s a good deal of jostling for use of the family seats.

The youngest son, Jonathan Peltz, used to strategically pass on earlier playoff games to claim the rights to later, more important playoff games.

Last year, Jonathan and his brother Moish were all set to go to one of the first two finals games against the Spurs. At the last second, his sister Maxine booked a flight home from New York.

“Like literally 24 hours notice,” says Jonathan.

Word came down that Maxine would get to go to the game instead of Jonathan.

“I mean I wish I didn't have to play that card,” says Maxine, “I would have rather been here for all of the playoff games.”

“It’s like a corporation,” says Jonathan, “She’s like: I cleared it with mom. So it’s like then she doesn’t have to ask me.”

Explicit texts were exchanged. A livid Jonathan, at some point, had to be talked down while pacing and fuming. Maxine considered canceling her flight and not coming home.

“[Jonathan] was really mad at me,” says Maxine, “and I was like: this is World War III in the Peltz family.”

Their dad, Arvin Peltz, says at this point he’s essentially given up on ever using the family tickets.

This article includes comments from the Public Insight Network, an online community of people who have agreed to share their opinions with WLRNA version of this article also ran on WLRN.

What is the point of a COO? A CEO? A CVO? A CKO?

Thu, 2014-06-12 10:37

The COO. Chief Operating Officer. What, exactly, does that even mean? What do COOs do?

Mostly, they do what CEOs don't have time to do – the menial toil of running the company, whether it's marketing and sales or research and development.  It's different for every company.  Often though, the COO studies to be the next CEO. Having a COO is a way of training, evaluating and grooming a future CEO.

But COOs are a dying breed. Since 2000, the percentage of S&P 500 and Fortune 500 companies with COO positions has shrunk from 49 percent to 35 percent. Many companies, according to executive placement firm CristKolder, are realizing that these duties can increasingly be taken on by chief financial officers, who aren’t as limited to numbers knowledge as they were in previous eras.

By Shea Huffman

"C-suite" or "C-level" refers to the highest-level executives at a company, taking their name from the three-letter initials starting with "C" that make up their titles. The most familiar such positions are chief executive officer (CEO), chief operations officer (COO) and chief financial officer (CFO). Such titles usually tell you who holds the power in different organizations, but recent trends, especially in the start-up scene, have all sorts of C-suite officers popping up that have some wondering what their titles actually mean.

Here are five C-suite titles we've found that seem a bit unusual in name at first, but might (or might not) make some sense once you figure out what they do.

Chief Agility Officer

Sounds like an executive for a clan of ninjas, or the self-given title of a football coach. Alas, the "agility" this title refers to is the corporate variety, not the physical. This one is technically a proposed position, but it derives its moniker from the growing agility movement, a corporate philosophy that emphasizes eschewing a rules-based work process in favor of an organization that is highly responsive to change. The chief agility officer, in that sense, is "tasked with creating and nurturing an Agile culture that pervades the whole organization."

Chief Knowledge Officer

Did the head librarian decide her title wasn't exciting enough? No, this officer is actually a fairly common position to see these days in companies like advertising firms, legal firms or even NASA. A chief knowledge officer is typically in charge of research and analytics for her company, gathering information on technology, customer relationships and successful business practices. They're also usually in charge of formulating and executing whatever strategic company-wide goals an organization wants to strive for, and to make sure they don't lose that knowledge after achieving a success; basically remembering what worked best. If it sounds similar to the more common chief information officer, that's because they do pretty much the same thing, but with different buzzwords. But CKOs totally swear they're different and you shouldn't get rid of them.

Chief Networking Officer

A networking officer sounds like a position a fraternity would cook up for setting up parties with all the popular sororities. CNOs are often favored by ad agencies and consulting firms, and are in charge of well, networking; they connect people and businesses within their companies with people and businesses outside their companies. The position can have some overlap with a chief marketing officer, but with less of a focus on sales and customer service, and more of a focus on communicating between offices and setting up those boring team-building exercises you always skip. A chief networking officer can also refer to a technical executive in charge of computer networking strategy, which arguably makes more sense.

Chief Visionary Officer

In the land of vague titles and start-up companies with unclear purposes, the chief visionary officer is king (or queen). Or really, they advise the king or queen (the CEO) on which direction to take the company. As the title can be used to formalize an advising position, the CVO is typically a high-ranking executive who performs executive duties, but with added responsibilities of creating a forward vision for the company, especially if they are operating in a fairly new industry. Internet pioneer Einar Stefferud is ususally recognized as the first CVO.

Chief Electrification Officer

If this one sounds like a title from the early 1900s that refers to the person who kept the all the lights on, that's because that's exactly what it is. Not normally used anymore in developed countries, the electrification officer was responsible for managing the electrical generating and distribution systems at companies during the beginnings of electrification in industry. The title still pops up occasionally in developing countries that still lack universal electricity. It also makes for a pretty cool title for the co-founder of a solar power start-up.

All by yourself

Thu, 2014-06-12 10:18

From the Marketplace Datebook, here's a look at what's coming up Friday, June 13:

In Washington, the Labor Department issues the Producer Price Index for May.

U.N. Secretary-General Ban Ki-moon celebrates his 70th birthday.

A three-day festival celebrating duct tape gets underway in Avon, Ohio. There's a parade, and clothes and the opportunity to get stuck to someone.

Or maybe you prefer some alone time. You're in luck. National Hermit Week begins.

And some folks celebrate National Weed Your Garden Day. That's guaranteed to get you some alone time.

Do Brazilians even want soccer anymore?

Thu, 2014-06-12 03:30

With the World Cup kicking off in Brazil today, many commentators have questioned the state of Brazil’s economy, considering the costs associated with the soccer championship.

Click on the audio player above to hear a discussion about the economics underlying the competition with Adolfo Laurenti, Chief International Economist at Mesirow Financial, and Leon Krauze, host of “Open Source” on Fusion TV.

The painting that was suddenly worth millions

Thu, 2014-06-12 03:00

Britain's National Trust now has a Rembrandt on its hands. Well, it's had the painting -- a portrait of the artist -- for several years, but until a few weeks ago the work of art was held in storage, thought to be a fake. 

After months of investigation, analysts and researchers are putting the price of the painting -- deemed authentic -- at $50 million, several times what it was worth before.

Click the audio player above to hear art critic Blake Gopnik discuss the business of art, branding, and the worth of the master's hand. 

So how much is a "selfie" worth? 

The Rembrandt has been referred to as one of the more expensive "selfies" ever created. Sure, the Ellen Oscar selfie has cache, but can it compare to the most pricey paintings and photographs artists have made of themselves throughout history?

While Britain's National Trust has no plans to sell their new Rembrandt, many "selfies"  have been auctioned for millions of dollars.

Click through the slideshow above to see some of the most expensive "selfies" ever sold.

Smart ads

Thu, 2014-06-12 02:35

Data on our data: The cost of surveillance

Thu, 2014-06-12 02:30

This month marks the first anniversary of the Edward Snowden leaks that changed our understanding of online privacy. Just like the subject matter of the leaks, the reporting over the last year has offered a deluge of information. So this week, we're posting a short series about all that data. Every day we'll bring you another number that reminds us how much we have learned in the last year about online surveillance and the reach of the NSA.

$278,000,000

spent in 2013 by the NSA on "corporate-partner access project

"This is the amount spent by the NSA in fiscal year 2013 under what it calls its corporate-partner access project," Says Susan Crawford, visiting Professor at Harvard Law School. "What they're doing is reimbursing telecommunications companies for domestic surveillance of all internet traffic"

The National Security Agency says that it's pulling data on only non-US citizens. Telecom companies, as well as tech companies, need to comply with these surveillance orders made possible through the Foreign Intelligence Surveillance Act. But they're still not allowed to be fully transparent on what data they're being paid to give up. 

Crawford says, "We do know that the fiber optics cables that NSA is getting access to carry everything - all of our phone calls, all of our emails - and our concern is that domestic surveillance can be carried out through these foreign intelligence programs.”

How a librarian made me a surveillance skeptic

Thu, 2014-06-12 02:00

I was at a dinner table about a year ago, right after the first Edward Snowden leaks, when I heard for the first time an argument I've heard many times since. 

"Why should I care? I'm not doing anything wrong."

This appears to be the opinion of the majority when it comes to the idea of the government using surveillance to fight terrorism. By Pew Research's estimates, 56 percent of Americans support the government listening in while it fights the "bad guys." And it has been this way for something like 12 years -- right after the September 11th attacks and the beginning of the war on terror. 

Whichever side of the line you're on, part of my job as a journalist is to give you information. But as a consumer of journalism, I've found the stream of information about government surveillance over the last year to be exhausting and desensitizing. Heck, even data tracking and run-of-the-mill privacy online seems like such a huge issue that you want to just go Vint Cerf and suggest that privacy is an anomaly. But it's important to at least try to understand and remember the impact of government surveillance and what we know about it. That's why all this week we've been talking about your location data, your phone calls, and your address books for the Data on Our Data series. 

I get the "why should I care" argument, I swear. I've echoed it myself a few times. But I'd be lying if I said it didn't worry me. I support our law enforcement agencies protecting us from attacks. But I also know governments are not static; they are living, breathing organizations that change and evolve drastically over time. And when it comes to surveillance, the big question is how and whether we are thinking about a time when our government might aggressively use ready access to data against its citizens. 

It was hard enough for me, last year, to dust off my basic understanding of the Foreign Intelligence Surveillance Act, the Patriot Act, and other legislation that has built the world we currently live in. But especially this week, I've been thinking about how governments aren't static, and how easy it is to forget the things we've put in place in the name of self-preservation. 

All of this thinking about surveillance, government, and legislation has also reminded me of a chapter in my own history that I haven't thought of in a while. During my junior year of college in 2003, I worked in the D.C. office of a moderate Republican Congressman. My main job was to answer constituent correspondence with letters that represented the Congressman's policy positions, which he would then sign. One day near the end of my spring semester, I had an assignment I couldn't complete: I was supposed to answer a constituent letter about a proposed expansion of the Patriot Act. The letter had been sent, and signed, by librarians throughout the Congressman's home state who were opposed to the Patriot Act's allowance of officials to access library records. They were asking the Congressman to oppose any extension or expansion of the legislation, and really to roll it back entirely. As I was preparing to tell the librarians that the congressman fully supported the legislation, I made a discovery. One of the librarian signatures on the constituent letter was familiar to me. It belonged to my mother. 

Golf group hopes fewer holes means a better game

Thu, 2014-06-12 01:00

As the U.S. Open golf tournament starts today in Pinehurst, North Carolina, the event’s organizers kick off a campaign aimed at golfers, encouraging them to play shorter games: 9 holes, instead of 18.

Golf has been losing players by the hundreds of thousands, partly because it takes so long to play — up to five hours for 18 holes.

“If you go to a movie it takes two hours, if you go to dinner it takes two hours,” says Hunki Yun, of the U.S. Golf Association. “So, a five-hour round of golf is not necessarily compatible with today’s lifestyles.”

David Hueber takes some responsibility for the problem. As head of the National Golf Foundation in the 1980s, he helped launch a strategy to open more courses. “Unfortunately,” he says, “we developed a product our customers — that is, golfers — didn’t want to buy.”

The new courses were designed by marquee architects to be hard, meaning they took a long time to play.

They were also designed to be big — partly to satisfy the real-estate developers who funded them. The bigger the course, the more houses the developer could sell overlooking it.  “Take a typical hole,” says Hueber. “If you add 50 yards to it, with home-sites on both sides, you’re going to pick up four home sites. You know, that could be a million dollars.”

Multiply that by 18, and a half-mile’s walk has been added to every game.

Raining? Twitter wants to help sell you an umbrella

Thu, 2014-06-12 01:00

One of the scariest lines a bad guy in a movie can say is, “I know where you live.”

But these days, thanks to location data, online advertisers almost always know where you are. 

In fact, Twitter and the Weather Channel want to let them in on still more information about potential customers -- a newly announced partnership will target ads, or “promoted Tweets,” to users based on where they live and what the weather’s like.

By letting advertisers know a customer is shivering or sweating, they’re hoping to help the company target its products.

“Sixty degrees might be cold in Miami, which means that you want hot coffee," says Curt Hecht, the global chief revenue officer at The Weather Channel. “Sixty degrees in Chicago means I’m getting an iced coffee, right?”

Hecht says The Weather Channel’s service doesn’t take into account users' interests through past posts or searches, but rather tries to predict their needs based on current and upcoming weather conditions. In the past, the company has worked with Pantene to market anti-fizz hair products to customers on days with high humidity.

“If previously we used to think more about different advertising for different people, now we’re starting to think different advertising for the same people at different states of their environment -- in this case weather,” explains Oded Netzer, a marketing professor at Columbia Business School.

There’s a strong correlation between weather and consumption, says Netzer. Knowing what the weather’s like is really useful for advertisers. Studies show that customers are generally more likely to buy things on nice days and even spend more for the same product if the weather is good.

“There’s some evidence that companies might be able to charge a little bit higher prices during warm weather conditions,” he says. “Whether this will be ethical to do and whether consumers react to that if companies do it is a whole different story.”

In other words, a consumer might find it helpful to see an ad for an umbrella right before it’s supposed to rain. Jacking up the price of air conditioners on a really hot day – not so much.

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