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Non-Tech : Any info about Iomega (IOM)? -- Ignore unavailable to you. Want to Upgrade?

To: Jim Welsh who wrote (50331)	3/16/1998 11:50:00 PM
From: Cogito	Read Replies (2) \| Respond to of 58324

>>Are you (and others) so certain that the advertising campaign has failed at this point. I think Allen pointed out earlier that KE indicated in the conference call that it won't be until April or May before the results of the advertising campaign can be assessed.<< Jim - Not only that, but KE also said that the initial costs of the campaign might force the company to go cash-flow negative for a while. He basically said that demand needed to be shored up by building awareness of the need for removable storage. In light of those remarks, the current situation is not completely surprising. It is very rare for any company to grow without burning some cash along the way. Late in 96, one of the biggest bear arguments about Ioemga was that they were cash flow negative, and since they were lowering prices, they wouldn't be able to turn that around. In fact, the company started accumulating cash sooner than anyone expected, and now we're used to it. I can sure understand how people could conclude that the ad campaign isn't working, though. We're all geared for immediate results. So right now, the future looks red. - Allen

To: Jim Welsh who wrote (50331)	3/17/1998 2:58:00 AM
From: Reseller	Read Replies (1) \| Respond to of 58324

Re: Are you (and others) so certain that the advertising campaign has failed at this point. Fair enough question, a summation that is subjective at best but you asked. The context under which the advertising campaign has been validated is that the computer owner doesn't know what the Zip drive is about. And to a degree to enhance the OEM pull thru sale. That they must be educated about the Zip. My evaluation of computer people is that they are generally more progressive, and have an understanding of their technology ( unless it's first time buyers ). Computer people know computer people, it is rare that you would find a singular computer user that doesn't have friends, coworkers, or family to share information. They visit computer sales areas looking for software and the like and have an awareness of the most popular computer items. ( Zip drives ) It is my contention that computer users know about Zip. Now if your target is Miss Susian home maker and Joe six pk than I say that they don't know or care about the Zip drive and won't buy a Zip drive unless the price is of little consequence. Any user that needs additional storage is going to be out there looking for it and running into Zip. On occasion there have been alerts of $89.00 or $79.00 Zip drives offered on different Internet sights, in a short time they're sold out and Initially K.E. had identified a price point program where he suggested that at a given price point the sales would improve exponentially stating that his goal was to reduce his price to spur greater demand. I think this was generally accepted as good marketing. Along the way he must have been convinced that sales could be enhanced by advertising alone thus the present program of firm prices. The marketplace will dictate, with the demand growing the price can be kept firm but demand is slowing and advertising is blazing, the marketplace is mandating something different. The least that I would have expected is that demand would still be growing without the advertising program. What I'm now expecting is a larger inventory build up with price reductions to follow. I'm satisfied that an alert was issued sooner in the program than later but as I said if K.E. doesn't respond to the slower sales with something other than advertising soon than I'm out. IMHO Regards Reseller