Pivot in Company Strategy – the Nvidia Example

After making chips and graphics chips for personal computers for most of the almost-20 years it has been in business, Nvidia has plunged headlong into a new market; that of the mobile chip, the chip that powers tablets and mobile phones.

Why has Nvidia changed its product strategy, and therefore its market strategy, and therefore its company strategy?

Well, because it feels it has to, that’s why. It’s current market is not only slowing dramatically because computer sales are down, it is beset by competitors like AMD and Intel who now include very adequate graphic processors in their standard setup, thereby effectively cutting Nvidia out of the picture in terms of selling an add-on graphic processor to the target PC manufacturer. Nvidia, and more specifically, Nvidia’s CEO, Jen-Hsun Huang, has made a tough decision that staying in their current market will lead to slow, but certain death, and is now striking out for the frontier of mobile chips.

The writing is certainly on the wall. As noted, Nvidia’s graphics chip business is taking some hits, and so is the segment they supply. Meanwhile, the obverse side of the coin has the Android operating system, which Nvidia has built its chip for, forecast to comprise over half the smartphone and tablet market within three years. Android is such a strong newcomer that most credible market analysts in the mobile industry believe that tablets with the Android operating system will outsell the current market champion iPad by over 50 million units by 2015. As a sidebar to this forecast, it certainly doesn’t bode well for the just-introduced Blackberry Tablet, but let’s focus on the matter at hand for today.

Okay, it’s one thing to make the decision, another thing to make a product, and then yet one more thing to actually sell a whole lot of whatever you make. There is little doubt that Nvidia has made the right strategic decision for their business, but can they execute on their new strategy?

Nvidia has a new chip called the Tegra 2, which is already in the new Samsung Galaxy Tab 10.1 and the new Droid X2 smartphone, the new Motorola Droid Bionic, the new Atrix 4G, and others and has gotten good reviews.

Nvidia also has an even newer quad-core processing chip called Kal-El (yes, that was Superman’s real name from his parents on Krypton) that is still not yet on the market that promises to make some serious waves. Nvidia has released a video of a homegrown game called Glowball that shows off the new (and obviously expensive) processor’s capabilities, and those capabilities are very impressive. The company says the new chip will be in Android-powered smartphones and tablets by September of this year.

If you’re wondering what the main competitive thrust is with improving the Android platform as it compares to the iPad, it’s mostly all about the ability to get movies and music on the device, and play that media back without crashing the device. The iPad is better than Android-powered devices at doing those things right now, but the new processors developed for Android by companies like Nvidia are closing that gap very quickly.

The Achilles heel in all of this is battery life. Nothing is free, and those processors suck up a lot of juice.

Which brings us full circle back to whether Nvidia can execute on their change in strategic direction. In fact, it is probably giving this scenario short shrift to describe what Nvidia is doing as a change in strategic direction; it is much more accurate to call it a reinvention of the company.

My personal opinion is that Nvidia has a very good chance of executing this massive reinvention. They read the tea leaves of where the market was going, and acted early. Huge kudos to them for their alertness in this regard. This, folks, is how you’re supposed to look out for your company’s future. But, praise aside, I think they’re doing everything they can to be successful in their new market. The next few years will be the test.

Brendan Moore is a Principal Consultant with Cedar Point Consulting, a management consulting practice based in the Washington, DC area, where he advises businesses in marketing, sales, front-end operations, and strategy. Cedar Point Consulting can be found at http://www.cedarpointconsulting.comm.


What is Your Social Media Content Strategy?

It usually works like this with content, tooA common complaint from businesses, large and small, is that they have a Twitter feed, a Facebook page, a website, a blog, they’re on LinkedIn and YouTube, etc. and they’re doing everything right in terms of being present in social media, but nothing is happening.

Upon inspection of their customer source data and other metrics, it turns out that they called that pretty accurately; there is nothing happening as a result of their presence in the digital online world.

Then you look at what is on their Facebook page, or their blog, or their Twitter feed, and it becomes obvious why nothing is happening. They have little or no content, and/or the content is awful and boring.

As we mentioned in this piece titled, Business Blog Primer, having smart or funny or informative or engaging or thought-provoking content is key to making social media work for your company, whether that’s on a blog, or on YouTube, or on Facebook, or even if you’re simply participating in a discussion on LinkedIn. And it needs to be consistent, as we mentioned in that same piece from a few months ago. There is nothing more pathetic than a business blog that has three posts in the past 12 months.

Social media is all about conversation, albeit in a digital vein. And just like regular conversation, if you don’t have something interesting or humorous or thought-provoking or relevant to say, people lose interest and don’t want to talk to you anymore, and they also don’t want to talk about you. And just like regular conversation, if it is interesting or humorous or thought-provoking, etc, then people will want to repeat it to others, in this case online. It will be tweeted, or re-tweeted, quoted, linked to, etc.

Can you create your own content? Should you create your own content? The answers to these questions are, in the order they were asked: “Yes”, and, “Probably not”.

Time for some brutal honesty here – most people cannot write very well. And most people are not skilled and creative enough to make good videos or podcasts. You might be one of those people in the minority that can create good (and hopefully, occasionally) great content, but you’re probably not.

Which is okay; most people that can create good/great content are really awful at calculating P&L costs or managing a call center or doing statistical modeling around account acquisition. Or, for that matter, leading a company or a business unit.

So, if you are truly skilled in the area of creating content, then you should do it. If you’re not, then you should get as much content as you can for free (legally!), and pay someone to create the rest.

Why is this worth the money you’re going to spend?

Because it’s important to your company’s brand and to the bottom line, and the online competition for eyeballs is fierce. Remember this when you’re thinking about social media: When you are competing for someone’s attention online, you’re not just competing with other providers of your product or service (your market competition), you’re competing with everything a person has available to them online. You’re competing with tweets they’re getting from their friends, tweets they’re getting from famous people, visits to the CNN.com website, all the posts and links they’re getting on Facebook, that website about sports they go to every day, emails their friends have sent them that have a link enclosed and text in the email saying, “You HAVE to read this”, dating sites, and on and on and on. There is a finite amount of things any person can look at online every day, and everyone makes an unconscious calculation of just how much time is going to be allocated to whatever single item they’re reading or viewing online. You’re competing with all of that other digital stimuli.

Furthermore, there are millions of teenagers and young adults that now rely solely on Twitter links or Facebook links to get whatever information or news they receive on a daily basis. They don’t visit news sites or blogs on a recurring basis, they merely respond when something is “pushed” to them by someone they know, with perhaps a descriptive four or five word blurb attached, and then they will follow the link to something on a blog or The New York Times website. Those of you with teenagers still around probably know that some teens visit Facebook dozens of times per day. All done while receiving texts from their friends, by the way.

If your social media content isn’t good in some way, it will be ignored. Period. You’ll never get anyone’s attention. And, if it is good and you get someone’s attention, and then don’t follow up with consistently good content, they will simply flutter away to some other distraction in the social media universe, like a butterfly that you cannot catch, and will never see again.

Good content is paramount to effective marketing via social media. Here are the ways to get good content on a consistent basis:

1)    Create your own.

2)    Get some for free – reprint articles from other sites AFTER getting permission from the owners of the content, link to other content, have guest writers, podcasters, videographers, etc.

3)    Hire talent to create content – either as a full-time employee or hire freelancers.

4)    Allow comments on your blog, Facebook page, etc. so that people can talk to you and each other about your company and its products, people, etc. When someone asks you a question, respond immediately and in a thoughtful way. This is all content as well, in case you’re wondering.

Don’t skimp. Don’t become lackadaisical and ignore putting out new content. Don’t expect immediate results. Don’t set up a blog or a Facebook page or a Twitter profile until you have first determined where your content is coming from and how often it can be generated. And, finally don’t get discouraged. This is not as daunting as it seems.

But it is necessary. If you’re going to play in the social media sandbox, you need a strategy for content.

Brendan Moore is a Principal Consultant with Cedar Point Consulting, a management consulting practice based in the Washington, DC area, where he advises businesses in marketing and strategy. Cedar Point Consulting can be found at http://www.cedarpointconsulting.com.