Companies can make brilliant moves, but there are also times when things don’t work out quite as planned. From an eco-friendly move that should drum up coffee sales to pulling the plug on some popular diversions, here are this week’s smartest moves and biggest blunders in the business world.
Starbucks (SBUX) — Winner
Starbucks is betting that deal seekers can be environmentalists, too.
The premium coffee house chain is introducing a reusable plastic tumbler that it’s hoping will help reduce the number of cardboard coffee cups it sends into landfills, and give java sippers an eco-friendly reason to keep coming back for refills.
It’s easy to knock the $1 tumbler. Even frequent customers may be reluctant to carry around a plastic cup. And the inconvenience of having to rinse out the tumbler will be a deal breaker for some.
However, Starbucks is hoping to make it a compelling purchase by offering a 10 cent discount on all coffees served in the new tumbler. In other words, a customer can make back the price of the tumbler with 10 visits.
Zynga (ZNGA) — Blunder
Virtual pets are being put to sleep. Your simulated mob life is getting whacked.
Zynga killed off PetVille and Mafia Wars 2 on Sunday. As tech blog TechCrunch points out, these are just two of the 10 games that Zynga has either taken down from Facebook (FB) or pulled from app stores in December. It’s a cost-saving move for Zynga, but let’s approach this from the gamer perspective.
There were still a lot of people playing these games when they got mothballed last month. What happens to the time that they have invested in nurturing their make-believe pets? What happens to the money that some players have spent to enhance theire gaming experiences? These are people who will never trust Zynga again.
Why should they? It shut down the source of their diversions, and now they know that it can happen at any time to any Zynga property that begins to fall out of favor.
Yes, Zynga will save some overhead here, but it’s going to be that much harder to attract new players to its other games now.
Zipcar (ZIP) — Winner
Zipcar has been a disappointment for investors since going public at $18 two years ago. But it became the hottest stock of 2013 when it agreed to be acquired at a 49 percent premium on the first trading day of the new year.
Avis (CAR) will buy the leading car-sharing service in a $491 million deal that cashes out Zipcar investors at $12.25 a share.
It means that Zipcar will go out as a busted IPO, but the deal makes sense for both companies. Zipcar is the top dog in renting out cars by the hour with gas and insurance included, but competitors have been waging price wars and offering perks such that Zipcar can’t afford to follow suit. It’s punching out at the right time. Avis, on the other hand, lacks a presence in auto sharing. This move catapults it into the driver’s seat with a single check.
Apple (AAPL) — Blunder
One of the features that Apple likes to show off on its iPhone is the “Do not Disturb” feature that lets smartphone owners make sure that emails or unwanted texts or phone calls don’t wake them up during the night.
Well, a bug in Apple’s iOS 6 reportedly left the mode running for users beyond the time when they have it set to automatically return to normal.
As far as Apple goofs go this isn’t really such a big deal. All someone had to do was to manually take the phone off of “Do not Disturb” mode. Apple says a fix should happen automatically for users in a few days.
However, this news item makes the cut because it happened just as Apple was introducing a new commercial promoting this very feature.
The new ad stars Venus and Serena Williams playing ping pong with the commercial’s narrator. He beats them. He’s dreaming after all, and was able to stay that way because he had enabled the “Do not Disturb” mode on his iPhone. The new spot was unveiled on Tuesday, just as the feature itself was failing to work correctly. Talk about a rude awakening.
SunPower (SPWR) — Winner
Solar energy hasn’t been a particularly bright light of late for investors. Weakening demand in Europe and cutthroat pricing among the panel providers has turned once-profitable green energy darlings into deficit-riddled dogs.
Sentiment may be changing, though, and Berkshire Hathaway’s (BRK-A) (BRK-B) Warren Buffett is leading the way. Shares of SunPower spiked on Wednesday after Berkshire’s MidAmerican Energy agreed to spend as much as $2.5 billion to buy a pair of projects that SunPower is building. It’s a big deal that validates solar energy in general and SunPower in particular.
Motley Fool contributor Rick Aristotle Munarriz owns shares of Zipcar. The Motley Fool owns shares of Apple, Berkshire Hathaway, Facebook, Starbucks, and Zipcar and has the following options: long JAN 2014 $20.00 calls on Facebook and short JAN 2013 $47.00 puts on Starbucks. Motley Fool newsletter services recommend Apple, Berkshire Hathaway, Facebook, Starbucks, and Zipcar.
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Tagged: Apple, Avis Budget Group Inc, Avis buys Zipcar, Berkshire Hathaway, Do not Disturb, Facebook, Finance, IPhone, Mafia Wars, mafia wars 2, MidAmerican Energy Co, Petville, recyclable, Starbucks Corp,