Media Blitz Offer for the NASDAQ-OMX Group, Inc - Case Study Example

Media Blitz proposal for the NASDAQ-OMX Group, Inc. XXX XXX Green Consulting The Company The NASDAQ OMX Group is the one of the worlds largest stock exchanges. It supports and manages market trades as well as market exchange technologies and other company services globally. It lists approximately 3,700 companies and also offers financial solutions to companies around the world. They operate more 70 exchanges and clearinghouse organizations and have central security depositories in more than 50 countries. They also have a modest investor relations component of their company. (“Who We Are”) NASDAQ had merged with OMX, a Stockholm-based provider of securities exchange services, in 2006. ("Thomson Financial Worldwide” 15) Currently the company has weathered the past years of financial instability in the markets and now needs a aggressively market itself with new trends and outcomes of this market. The sustainability trend is now a permanent component of any corporation and the NASDAQ-OMX Group now needs to align itself with that element. The NASDAQ-OMX Group had run a series of soft-sell ads that helped it enter into an environmentally friendly stance as well as associate it with the companies that have a green intitiatve and are also members of their exchange. The ad campaign was run in 2008 and consisted of several 15-second TV spots that aired on broadcast and Cable channels. While having the twin benefit of supporting the companies it does business with, the actual impact of the ads for either partner was minimal. The ads themselves were both short and somewhat esoteric so that the viewer may not only have missed the companies associated with it but completely misunderstood the message intended. They have also marketed the NASDAQ OMX CRD Global Sustainability 50 Index which is one of the more green initiatives in the stock markets at the moment. The campaign would have worked better with more direct association. During the past two years the economic crisis has been felt by all sectors, but especially in the financial reporting and indices markets. However, while 2008 was a critical year your company certainly held its own and showed less of a percentage downturn than most other reporting indices. The following graph illustrates a stable stock price from October 2008 to January 2010. Current Stock Trend Stock Charting 2008-2010 Chart 1: Financial info provided by Yahoo Finance This is the indication of an extremely stable company that had pulled in the reigns and was able to get through the storm. However, as you can see by the following chart showing net profit for the past four years, the boom in 2007 has tapered off to a holding pattern in 2008 and 2009. Net Profit 2006 -2009 Chart 2: Financial info provided by Yahoo Finance Please note that 2009 data is an estimate and not final financial figures for the company. The 2008 Campaign Samples of the 15-second spots are on the NASDA_OMX Group’s corporate web site, six ads one of which is for the partner-company First Solar. (First Solar Sunrise) They market Alternate energy technologies such as solar, wind and hydro sources, which are reusable and extremely environmentally friendly. An association with this company should surely have put a positive spin on the environmental impact or at least a friendly environmental appearance for NASDAQ-OMX group. The commercial itself is the image of a beautiful, albeit fast moving, sunrise over a water filled valley of trees as the wind blows through them. In a sense in that time span of fifteen seconds one perceives all of the alternate energy sources that are available on the planet. However, it was not until several successive viewings that our focus group was able to put that particular component together. There is some light ambient music playing in the background and as the sun climbs a male voice in the background says, “The companies that move life forward list on NASDAQ, the company that moves business forward.” (First Solar Sunrise) There are five other spots that have the same tag line with different companies all tangentially associated with the social environments of human beings and their associated life challenges. However, the First Solar spot was the most directly associated as an environmentally friendly ad that was to be found in this group of six. However, the rest also show, as the company states, the following, that, “Above all, this campaign emphasizes in a powerful way our global brand and the positive connection between NASDAQ and the companies that list on our market.” (“Who We Are”) I would certainly take umbrage against the words “in a powerful way,” since there is very little impact in the one short term viewing of the spot. While it is certain that this campaign played well after successive viewing of the spots by the chief decision-makers, their real world impact on the credibility of the associated companies appears minimal. Considering the stable state of the company we believe it is time for a new commercial camping that will be able to take this stability and add companies to your index and profit in your pockets in a rather short time frame. While the potential for success we believe is quite his there are of course obstacles and risks to any venture. Obstacles To put it frankly, one of the difficulties in marketing a large company such as NASDAQ-OMX group is that they are usually associated with other corporations that do not have very eco-friendly dispositions towards the environment. For instance you list companies such as ATP Oil and Gas, and such companies have certain negative environmental associations with the general public, regardless of their actual track record. Furthermore, companies such as Auxillium Pharmaceuticals, who lists on the NASDAQ-OMX Group’s exchange (this is correct) are also negatively associated with health care costs, again regardless of the objective reality. However, in review of the rest of your listings there are many companies that can be associated with a more positive impact on the environment. This is especially true when one considers their newer issues which are green initiatives such as the NASDAQ OMX CRD Global Sustainability 50 Index. They advertise the index is an: …equally-weighted equity index that serves as a benchmark for stock or companies that are taking a leadership role in sustainability performance reporting and are traded on a major US stock exchange. The companies voluntarily disclose their current environmental, social and governance risks as well as their revenue opportunities and how it will affect future performance. (“The NASDAQ OMX CRD”) Potential Risk As with any investment comes risk and advertising is no exception. In this case, while associating the NASDQ with companies such as First Solar and the others listed in the NASDAQ OMX CRD Global Sustainability 50 Index, any company can make an error in judgement or have accidents that negatively impact their bottom line. In this type of advertising venture the risk become that you have no direct control over these other companies and bad press for them will become bad press for you. Other risks include other downturns in the market and other financial pitfalls that are out of the control of the group. However, Green Consulting believes that he who hesitates is lost and to restrict this increase in advertising now will result in even poorer results for the group. Current Views One of the influences that may now be driving the NASDAQ-OMX group to attempt to create a clearer association with the greening of the finance sector may have been their milquetoast showing as listed in the Newsweek cover story, "The Greenest Big Companies In America.” We started with the biggest companies, as measured by revenue, market capitalization, and number of employees. The Green Rankings are the product of a yearlong collaboration with three of the leading players in environmental research: Trucost, which calculated each companys Environmental Impact Score, based on more than 700 metrics, including water use and acid-rain emissions… (McGinn 35) In this listing The NASDAQ-OMX group came in at number 269, just below the half-way mark. Furthermore, it also ranks at number 30 of the 50 best performing financial companies. (Foust 38) They are attempting to penetrate the global market of best performing companies, but their lackluster ad campaigns do not seem to convey either confidence or any information as to their goal. Summary of Current Position While NASDAQ-OMX’s ad campaign certainly has a penchant for creativity and resourcefulness whittle down into a 15-second spot, its overall impact remains limited. The several spots are so short that most viewers –do not understand them or feel their impact in a single viewing,. However considering their content, if the ads were lengthened, it would not have helped either. While the initial camping certainly had some impact and some strength of association, we feel that it was too little dollars spent with virtually no return on your investment. Currently the group has limited its advertising in order to keep expenses low, a wise move over the past two years. However, now is a time of stability for the company and a time for bold action. Recommendations Our teams of media consultants and creative artist have chosen to take the 2008 ad campaign and recreate it so that the association with the companies and with the environment is stronger and more concrete. There will be several spots for the same companies, a 15, 30 and 60 second commercial as well as using the blogs and twitter sites your company has already established to promote not only your association with these companies but the company’s your NASDAQ OMX CRD Global Sustainability 50 Index. We feel that the combination of these two venues will not only help to present your company as socially responsible but will also be essential in increasing NASDAQ-OMX’s business presence in the environmentally friendly community. As the economy begins to improve in 2010 and your company along with it, environmentally friendly initiatives taken now in advertising will begin to pay off in the very near future. NASDAQ-OMX needs to act now to take full advantage of this trend and allow us to create the ad campaign that will take them there. We propose an aggressive association with companies on your index that embody a green consciousness and in fact have a triple bottom line, which has become a catchphrase for social conscious companies in the new Millennium. This triple bottom line requires that a companies initiative encompass, “people, planet and profit” In other words have a social and ecological framework as well as a profit margin to balance. Green Consulting proposes and initial investment of 1.5 million, with subsequent smaller investments over the next 5 years. We believe this will increase revenues exponentially as more and more companies, as well as the public, embrace the green consciousness. We will create several commercial spots for both Television and Satellite Radio as well as new blog spots and Twitter runs. These will be composed of a more active association with companies on the NASDAQ-OMX Group’s exchange that are on the list of Green corporate entities. Furthermore, we will promote spots that state the NASDAQ-OMX Group stand on sustainability and commitment to the environment as well as the economy. The following Chart illustrates what we believe is a conservative estimate for an increase in potential income to 2015: Chart 3: Green Consulting More and more this community is being composed of larger and larger corporations and by the company’s own admission you wish to continue to strive to attract such companies to its index, this would be an ideal match. As the economy begins to improve, environmentally friendly initiative, although expense in the short term, will begin to pay dividend down the road. NASDAQ-OMX needs to act now to take advantage of this and allow us to create the ad camping that will take them there. Green consulting has partnered with many companies that have jumped on the green bandwagon, as you can see from out prospects, and the results have been astounding. I look forward to your feedback at our follow up appointment on March 1st when I will present the beginnings of our campaign to you and your board of directors. Works Cited “First Solar Sunrise.” NASDAQ-OMX Group. 2008. Web http://www.nasdaqomx.com/static/corp/tvspots/FirstSolar_Sunrise.wmv Foust, Dean, et al. "THE 50 BEST PERFORMERS." BusinessWeek 4125 (2009): 37-63. Business Source Alumni Edition. EBSCO. Web. 2 Feb. 2010. McGinn, Daniel. "The Greenest Big Companies In America. (cover story)." Newsweek 154.13 (2009): 34-54. Business Source Alumni Edition. EBSCO. Web. 2 Feb. 2010. “NASDAQ OMX and CRD Analytics Launch New Index Tracking Corporate Sustainability Performance.” Boston.com. 2009. Web http://finance.boston.com/boston/?GUID=9128637&Page=MediaViewer&Ticker=QCRD “The NASDAQ OMX CRD |Global Sustainability 50 Index.” Accountability Central.com. 2009. Web http://www.accountability-central.com/crd-analytics/smartview-sustainability-100-triple-bottom-line-ranking-copy-1/ "Thomson Financial Worldwide Mergers & Acquisitions." Mergers & Acquisitions Report 20.22 (2007): 5-11. Business Source Alumni Edition. Yahoo Finance. “NASDQ_OMX” Quote. 2010 Web http://finance.yahoo.com/q?s=ndaq “Who We Are” NASDAQ-OMX Group. 2009. Web http://www.nasdaqomx.com/whoweare Read More