• roar...

    At the risk of sounding like a 40-something, middle-aged malcontent, I have to observe that good movies have become fewer and farther between than back in the good old days. Sure, there have always been real stinkers. There were I think five Police Academies, at least eight Tremors, countless Friday the 13th's and Nightmare on Elm Streets; but there were always good thought-provoking ones to balance out the garbage. Quentin Tarantino's early works were very good examples, and I can name dozens of movies from the late 80's to late 90's that were very, very creative and original. No longer. It seems that every obscure superhero has been exhumed and reanimated for the big screen, and most of the popular ones have been made and remade several times. It appears that the industry is in a state of creative malaise.

    You should need no more evidence than the report last week that the re-release of a movie made almost 20 years ago, the Lion King, was the top grossing movie, topping such gems as Moneyball (actually quite good I hear), Dolphin Tale (yes it's what you think it is..with Harry Connick Jr. no less), Abduction, and perhaps the even more generic Killer Elite. Yes it's in 3D (a format invented in the 1950's which has not caught on nearly as fast as many opportunists predicted) but it's a CARTOON! And we are talking about old school animation too. According to the Wall Street Journal, the movie last weekend grossed three times more than the nearest never-before-viewed competitor. Hopefully this is simply a blip on the radar, but the music industry doesn't seem to be doing much better. Are the prices really worth it to consumers? Has the industry failed to deliver increased value along with increased prices? Let's see what the Fall season brings.

    If movie quality has indeed decreased, what are the reasons for this?

    Is there a relationship between declining quality and a decreasing base of moviegoers?


  • Goodbye to Bookstores?

    Well, let's hope not. Sure, it's important for consumers to have online buying options since there are so many customer advantages to using an Internet-based retailer, but to think that in the near future there will be no need for a brick and mortar format in the industry is a bit myopic. Physical stores will survive in some form or another, and it is crucial for smaller players, in the face of heavy competition, to differentiate themselves from competitors and substitutes. Ways to do this include offering titles not found in larger bookstores, enhancing customer service not found online, attention to in-store aesthetics and offering other products such as lounges, coffee stands, etc. Brick and mortar stores in other industries have survived adverse market forces. For instance, thousands of smaller format natural foods stores still thrive, even in the face of expanding online options and competition from Whole Foods Markets, Wal-Mart, Safeway, and hundreds of larger players offering more selection and lower prices. It appears that these stores are doing something right,and the book industry would do well to learn from them.

    One of the many problems small format bookstores face is a lack of shelf space. The store can only keep so much in inventory, and consumers are only willing to wait so long for their purchases to be delivered. Enter Print-On-Demand by On Demand Books, LLC. Out of stock? No problem. You can print the book right there in the store. Your desired book is out of print? No problem. The store has access to rare titles. Is this enough to keep an increasingly irrelevant business model afloat? No, but these are the kinds of things marketers must do to differentiate their products from those of competitors and to combat the migration toward digital reading. Book stores will be around for a long time even as gadgets with e-reader capabilities gain in popularity. The winners may not be the Barnes and Nobles and Borders of the world. The winners may creatively destroy the industry, leaving opportunity for innovation and better products and service for consumers.


  • Unhappy Holidays?

    It seems a bit early to be making predictions about whether retail sales will grow or remain flat this year, but this is exactly the time when observers begin making these sorts of predictions. One reason for this is that "back-to-school" sales (which have notbeen encouraging) are a good predictor of holiday sales, and another perhaps more important reason concerns the monitoring the supply chain. When orders for supplies such as ingredients, components, and technology-based support products do not meet expectations, we can all expect a slowdown. And this is exactly what appears to be happening. A projection of only 3% growth (a negligible growth rate which is barely enough to keep up with inflation) during the months of November and December 2011 are now the standard forecast among organizations such as the International Council of Shopping Centers and Shoppertrak. This may be good news for consumers, as retailers rely on ever-earlier and ever-deeper discounts, but many retailers will likely be in deep trouble after the crucial buying season is over.

    Last year's modest increase of 4.1% wasn't enough to keep large retailers like Borders in business, and it is likely that low sales this year will result in another round of chain closings. Who will be next? Which are the competitors in each retail category that are the least likely to weather such a downturn in sales? Is Best Buy next? Barnes and Noble? We will follow this very closely for our readers. Read more through the below link.



  • Coke Sizing Up Its Consumers

    Talk about a shift in product strategy! Much of Coca-Cola's growth strategy over the past several years, aside from their male-targeted Coke Zero product, has been "bigger is better" as the company has focused on 20-ounce bottles, two-liter bottles, and 12-ounce/12-can cases for the majority of its retail sales. Recently, the company introduced a "less is more" group of new product sizes, which are cheaper to make and have a cheaper retail price point.  Behold Coca-Cola's new 12.5 ounce and 16 ounce bottles, priced at 89 cents and 99 cents respectively! This is clearly an attempt to attract more price-conscious consumers in an economy that is most likely only going to get worse before it gets better. This strategy has already worked in Mexico during the 1990's, and Coke anticipates that it will result in positive numbers for the brand here in the U.S..

    Other reasons cited for this strategic shift include the rising costs of plastic and corn syrup and the growing health and wellness trend, which is driven largely by fears of societal obesity and its myriad associated costs but also by other factors. "Less is more" may become a national mantra in the face of expanding waistlines and rising medical costs. These new bottles also consist of recycled plastic and biomass (sugar cane) suggesting a shift toward addressing the "green" social trend. There appear to be a lot of reasons for this move. Could replacing the controversial sweetener high fructose corn syrup with cane sugar be the next move for Coke? What do you think? Is this the beginning of a greener, healthier Coca-Cola? Read more below:



  • The Death of the Daily Deal?

    In an earlier post from several weeks ago, we discussed the present and future of "daily deal" sites such as Groupon and Living Social. These sites sign up retailers and service companies and offer discounts as high as 70% off to drive traffic to their locations. Website visitors are also encouraged to sign up their friends to receive further sales promotions. An inherent problem with Groupon, a fast-growing firm that still has aspirations of an Initial Public Offering, is that the business model is easy to duplicate. As a result, hundreds of competitors emerged shortly after Groupon launched, rising to 530 daily deal sites nationwide, according to the Wall St. Journal. Since then, competitive forces, extremely high and rising customer acquisition costs, and a host of other factors have reduced this number by 170 sites, all of which have recently shut down. This rapid shakeout is not good news for the product category, and it will likely morph into a different kind of business model since an unsustainable business model is, well, unsustainable.

    The other major issue with "daily deal" sites in general is the idea of over-discounting. Quite simply, consumers love the "70% off" sales promotion, but are often unwilling to pay the full price the marketers eventually need to charge to stay in business. Many consumers expect to continue to pay the discounted price and will shop around to find it. This consumer tendency towards deal-seeking defeats the purpose of a sales promotion, which is a short-term offer of value to elicit a response, in this case, a visit to the store, in an effort to win loyal customers. The key here is "short term" offer. An ongoing discount is simply an Everyday Low Price, so over-discounting eventually becomes counterproductive.

    In the meantime, go out and get those deals while they last, and perhaps even while the sites themselves last.


  • Google Versus Facebook

    The converging worlds of social media and search are about to get much closer to one another. Without a tremendous amount of fanfare and hype, Google has slowly rolled out its alternative to Facebook, Twitter, and the increasingly less relevant MySpace. The product is called Google+ and is most certainly sure to present a myriad of difficulties for the powerful market leader in social media and for other players as well. Google is obviously a major global brand and, as such, can leverage its "brand equity", the value of the brand beyond its features and benefits, to create all kinds of Internet-related products. Very soon, instead of just thinking of Google when you think of "search," you may be thinking of Google regarding a variety of Internet product categories. The company's foray into social media should not be much of a surprise, and a brand's dominance in the marketplace may only last a short time, especially in the fast-paced world of Internet technology. It would be prudent to remember MySpace's dramatic loss of 50% market share within one year.

    Google+ was initially launched as an invitation-only social network back in June 2011, so that may be why you didn't hear much about it. By the end of July the site had 25 million visitors, which is a very rapid rate of growth. But if you compare that with 750 million on Facebook and 100 million on Twitter, and it is clear that Google has a long way to go. How will they search giant catch up? One way is through bundling. Google can integrate this new social media product with other products such as Google Search, and this may put Facebook at a competitive disadvantage, since although it is easy to search for people on Facebook, it isn't easy to search for content. Don't expect Facebook to sit and spin as Google innovates itself into market leadership, however. This lesson was learned by most observers of the MySpace's now-legendary fall from grace.

    Innovation is a continuous process. This will be an exciting contest to watch and, as is often the case with the well-documented benefits of a heightened level of competition, the winner is the consumer.


  • Social Marketing: A Positive Force for Change

    Social marketing refers to the use of marketing principles and techniques to influence a target audience to voluntarily accept, reject, modify, or abandon behavior for the benefit of individuals, groups, or society as a whole.  A major concern of social marketing must be to bring about changes in the social structure factors that impinge on an individual's opportunities, capacities, and rights to have  healthy, happy, and fulfilling life.


    Social marketing has been effectively utilized in such causes as encouraging volunteerism, organ donorship, environmental activism, energy conservationism, safe sex practices, use of bicycle helmets, egagement in eco-tourism, healthy diets and exercise, consumer safety and traffic safety, radon testing, and voting.  It has been used to discourage tobacco use, drug use, alcohol use, unsafe sexual practices, sex tourism, abuse toward women and children, etc.  It has also been used to encourage increased care for the elderly and babies.   Uses of social marketing that further suggest its possible effectivenes in discouraging negative behaviors are to encourage postrape medical care and forensic examination, encourage frequent testing for STDs, etc.

    Here is a quick history of social marketing.  Social marketing was "born" as a discipline in the 1970s, when Philip Kotler and Gerald Zaltman realized that the same marketing principles being used to sell products to consumers could be used to sell ideas, attitudes and behaviors.  Social marketing seeks to influence social behaviors not to benefit the marketer, but to benefit the target audience and the general society.  Like commercial marketing, the primary focus is on the consumer--on learning what people want and need rather than trying to persuade them to buy what we happen to be producing.  Marketing talks to the consumer, not about the product.  The planning process takes this consumer focus into account by addressing the elements of the marketing mix.  This refers to decisions about 1) the conception of a product, 2) price, 3) place (distribution) and 4) promotion. These are often called the 4Ps of marketing.

    The social marketing product is not necessarily a physical offering.  A continuum of products exists, ranging from tangible, physical products (e.g., condoms), to services (e.g., medical exams), practices (e.g., breastfeeding, ORT or eating a heart-healthy diet) and finally, more intangible ideas (e.g., environmental protection). In order to have a viable product, people must first perceive that they have a genuine problem, and that the product offering is a good solution for that problem.  The role of research here is to discover the consumers' perceptions of the problem and the product, and to determine how important they feel it is to take action against the problem.

    Price refers to what the consumer must do in order to obtain the social marketing product.  This cost may be monetary, or it may instead require the consumer to give up intangibles, such as time or effort, or to risk embarrassment and disapproval.  If the costs outweigh the benefits for an individual, the perceived value of the offering will be low and it will be unlikely to be adopted.  However, if the benefits are perceived as greater than their costs, chances of trial and adoption of the product is much greater.  In setting the price, particularly for a physical product, such as contraceptives, there are many issues to consider.  If the product is priced too low, or provided free of charge, the consumer may perceive it as being low in quality.  On the other hand, if the price is too high, some will not be able to afford it.  Social marketers must balance these considerations, and often end up charging at least a nominal fee to increase perceptions of quality and to confer a sense of "dignity" to the transaction.  These perceptions of costs and benefits can be determined through research, and used in positioning the product.

    Place describes the way that the product reaches the consumer.  For a tangible product, this refers to the distribution system--including the warehouse, trucks, sales force, retail outlets where it is sold, or places where it is given out for free. For an intangible product, place is less clear-cut, but refers to decisions about the channels through which consumers are reached with information or training.  This may include doctors' offices, shopping malls, mass media vehicles or in-home demonstrations.  Another element of place is deciding how to ensure accessibility of the offering and quality of the service delivery.  By determining the activities and habits of the target audience, as well as their experience and satisfaction with the existing delivery system, researchers can pinpoint the most ideal means of distribution for the offering.

    Finally, the last P is promotion.  Because of its visibility, this element is often mistakenly thought of as comprising the whole of social marketing. However, as can be seen by the previous discussion, it is only one piece.  Promotion consists of the integrated use of advertising, public relations, promotions, media advocacy, personal selling and entertainment vehicles.  The focus is on creating and sustaining demand for the product.  Public service announcements or paid ads are one way, but there are other methods such as coupons, media events, editorials, Tupperware-style parties or in-store displays.  Research is crucial to determine the most effective and efficient vehicles to reach the target audience and increase demand.  The primary research findings themselves can also be used to gain publicity for the program at media events and in news stories.

     Read more:  http://www.social-marketing.com/Whatis.html


  • You Don't Have to be Unemployed in Marketing

    Getting close to graduation?  Or have you already graduated, but haven't found a job yet?  Or have you been employed and are now searching because you got laid off, downsized, or you just want to change jobs?  There is no doubt that it is more difficult to find a marketing job than it was 15 years ago, but it is still possible and even probable if you prepare.  There are strategies that will dramatically increase your chances of finding that marketing job.  Here are some things you can do.

    1.  Get involved. Most large cities have chapters of national or international professional associations, such as the American Marketing Association (AMA), the American Advertising Federation (AAF), etc.  The AMA also has student chapters at many colleges and universities.  Joining these organizations and being active in them can be a great way to meet a wide variety of people who already are successful in the marketing profession or who are in your same situation and are trying to find jobs in marketing.  Every event these groups sponsor is an opportunity for you to get yourself in front of marketing professionals. There are also a number of blogs written by and for people in the marketing community. Reading these blogs, posting comments, and even contacting the authors directly with questions is an increasingly critical part of this networking effort.

    2.  Talk to people.  Since everyone had to start somewhere, contact people you know in the field and ask for an informational interview.  Many people with established careers are more than happy to meet with those who are just starting out.  Talking with them about the things they did to get their careers off the ground may give you some ideas and give them a chance to share their wisdom.  Asking these folks to give you feedback on your resume and cover letter is also a good way to get your resume out there without fear of it getting lost in a sea of job applicants.

    3.  Target the company, not the position.  Sometimes it’s easier to get a job at a particular company than it is to get a job in a particular department.  If you are having a hard time getting an entry-level marketing job, but have a clear idea of the type of company for which you would like to work, see if there are other entry-level jobs there where the bar may be lower.  For instance, it might be easier to get a job in sales or customer support, than it is to get a job in other areas of marketing.  You will often find that, thanks to the amount of customer interaction and insight that those roles provide, they often lead to opportunities in other marketing areas later.  

    4.  Get practical experience.  Use every opportunity you can to get practical experience.  These opportunities may come in the form of university classes where student teams actually work with small businesses to write marketing plans, produce advertising, etc.  They may come from marketing internships while going to college and often these internships can be taken as marketing elective classes that will not only give a person valuable experience, but will also allow them to get one step closer to graduation.  Many companies will still give internships to people who have already graduated, and many of these internships are paid.  Don't give up on the internship idea just because you have already graduated.

    5.  Find ways to set yourself apart and above from the mulitudes of others who will likely be applying for the same jobs.  Years ago, I had a student who wanted to get a job in the music industry.  Instead of creating the usual resume, he created a resume that looked like a CD case.  This creative approach helped get him his dream job.  The market nowadays is probably not that simple, but even small things like a unique approach to a resume might help.  Other things a person can do is to volunteer for various social causes.  This will not only be a resume builder, but will also help accomplish some of the other points above, such as networking with other people and getting practical experience.  If you are a student, you may want to consider getting a minor in such areas as graphic design, management information systems, or finance.  You may also be at a school that offers certificate programs in addition to minors.  For example, my university offers a sales certificate that requires a student to take a sequence of classes in sales.  There may also be professional certifications you can obtain.  The AMA, for example, offers a professional marketing certification.  You may also seek ways to distinguish yourself by winning awards, scholarships, etc.

    In my experience as a marketing professor for a decade and a half, I have watched the students who have conscientiously done one or more of the above land great jobs, while those who aren't willing to put in these efforts are still looking for jobs months after graduating.  These diligent students have jobs at large oil companies, with professional sports teams, in the music industry, at Intel, at Microsoft, with USAA, at well-known advertising agencies, and probably the ones who are earning the most money are working in sales in the pharmaceutical industry or the financial services industry.  Do your homework and preparation and you will be successful in finding that marketing job.

    Read more:  http://www.marketingpower.com/Careers/Pages/HowtoGetYourFirstJobinMarketing.aspx

  • Consumer Marketing Knowledge Better for Goods than for Services?

    As those familiar with basic marketing concepts know, products can be either goods or services.  There is also something called a goods/services continuum that accounts for the fact that many products have characteristics of both goods and services.  Those knowing marketing also realize that pricing is one of the elements of a marketing strategy, otherwise known as the marketing mix or the 4Ps.  In today's economy, it seems that consumers would be more price sensitive than at perhaps any other time in the history of the United States.  However, it appears from recent research that this sensitivity to price is more pronounced in relationship to goods than it is to services.  Here's a little background.

    It is no revelation that the economy of the United States is now service-based.  As early as 1948, services accounted for about 60% of the U.S. GDP and 55% of the U.S. labor force was working in the services industries.  By 2009, services had become even more important in the U.S. economy, accounting for 76.9% of GDP and 70% of the labor force.

    Read more:  https://www.cia.gov/library/publications/the-world-factbook/ 

    Many businesses that were once viewed as manufacturing giants have either disappeared completely or are shifting their focus toward services.  For example, IBM, once on the cutting edge of computer and technology manufacturing, is now amongst the largest services companies in the world.  IBM abandoned most of its manufacturing in favor of providing services and is the global leader in information technology services and consulting, employoing approximately 200,000 services professionals around the world.

    Despite the economic emphasis on services in the United States, consumers' perceptions of service are less positive than are their perceptions of manufactured goods.  Though the output of the United States is mostly acocunted for by services, goods are still more prominent in consumption, with 60% of American consumption being in foreign-produced oil.  Thus, consumers may not be as familiar with strategies surrounding the marketing of services as they are with marketing strategies for goods.  A major component of a marketing strategy is pricing.  We have a good idea of what we will pay for a music CD, but is our knowledge of the price of a concert as sure?  We know how much we pay for a meal in a restaurant, but do we have a good idea of the cost of an hour of house-cleaning services?

    Consumers also tend to be less satisfied with services in general.  The University of Michigan's American Consumer Satisfaction Index consistently indicates lower satisfaction scores for services in all industries when compared to other products.  Given economic growth in services, their profits, and the low levels of customer knowledge and satisfaction, the potential for estabilishing competitive advantages for companies that can excel in marketing strategy design to improve consumer knowledge and satisfaction is great.

    Read more:  http://www.theacsi.org/

    A recent study found that consumer price knowledge for goods is much more developed for goods than it is for services.  These findings indicate that organizaitons marketing services have an enormous opportunity to develop their pricing strategies, and the promotion of these pricing strategies, to their customers.  Since this weakness in price knowledge is demonstrated in several industries in this research, it appears that the lack of knowledge about prices for services is universal across all service industries.  Those companies in each service industry that can recognize this and develop stronger pricing strategies have a definite opportunity to gain a strategic advantage over those organizations that continue to maintain status quo.

  • Can't Netflix Do What It Wants?

    Full stream ahead for Netflix, as it launches Qwikster DVD service. Home Cinema, Netflix, DVD, Streaming, Movies, Video on demand 0

    The answer to the above question seems to be, "it can, but no one is going to like it."  Is Netflix's decision to separate its popular DVD mail rental and video-streaming services a solid strategic move?  The general negative consensus by both customers and analysts is depicted in a cartoon found at the following website.


    Netflix CEO Reed Hastings said the company plans to separate its DVD-by-mail service from the streaming service. The DVD service will be called Qwikster, and the streaming service will keep the name Netflix.  Analysts also believe that it won't be long before Netflix spins off Qwikster, getting completely away from the DVD service that has been its bread and butter since its inception.  One analyst said the the company did three things wrong.  "They raised prices. They offered lower-quality content, and they made it more complicated."  Before, customers paid $9.99 for DVD rentals and streaming. The new price is $7.99 for each. Investors have given Netflix shares a thumbs-down since the changes. Shares closed at $143.75 Monday, down $11.44, or 7.4%.  The next day, stock prices fell an additional $13 per share.  As news spread across the Internet, Netflix subscribers expressed dismay about the developments on the Netflix blog, Facebook and news sites. What was their biggest concern? People who both rent and stream videos will have to log in to two different sites and get two different credit card charges.

    Read more:  http://www.usatoday.com/tech/products/story/2011-09-19/netflix-splits-dvd-streaming/50464122/1

    Analysts frrom finance and marketing are joining the multitudes of consumers who are seriously questioning Netflix's decision to separate its streaming video service from its DVD-by-mail division.  Market watchers say the split could cause more subscribers to drop the service. Netflix will rename its DVD-by-mail operation Qwikster, a brand name that's both hard to pronounce and unknown to consumers. It will also expand into video game rentals. The streaming service will still be called Netflix.  Why would Netflix retain the part of its business that is newer and not as well known and give the better-known portion of its business a new, difficult to prounounce, and unfamiliar name that may be spun off?

    At least some of the answers are marketitng problems.  Netflix appears to be out of touch with its customers.  Being a mail-service and online company makes it more difficult to know a target market than it is for companies that have face-to-face contact with their customers.  However, maintaining a close relationship through relationship marketing is essential for all companies, and may be even more important to this type of company.  That brings up another marketing problem.  How does a company get to know its customers?  The answer is through marketing research.  It is essential for companies that do not have face-to-face contact with their customers to find out about them in other ways through the conduct of marketing research.  Online or mailed survey projects can be conducted to find out essential information.  Sometimes, not taking the trouble to do this could result in the demise of a once successful enterprise.  Will that be the eventual fate of Netflix?  The company has certainly damaged its image and reputation. 

    Another marketing concept that can applied to this situation is the idea of service failure (whcih Netflix has done) and service recovery.  How well will Netflix recover from this service failure.  Service recovery means the company will provide something to its customers that will make up for its mistake.  Some marketers even believe in the service recovery paradox.  This paradox is that it is better to fail and then recover really, really well than not to have failed at all.  Some companies even have service failures and recoveries programmed into their long-range strategies.  It does not appear this mistake was part of Netflix's long-term strategy, but whether it survives or not might very well depend on how well it recovers.

  • Seeing Eye to Eye in College-Level Marketing Classes

    Many changes have been introduced into marketing education recently.  The view that marketing education needs to be revised and revamped has become more noticeable since the turn of the century and even accrediting agencies are beginning to alter their guidelines for teaching these classes.  The Association to Advance Collegiate Schools of Business (a major business school accrediting agency) guidelines suggest that marketing students need a better understanding in many areas, including ethics, international marketing, communication skills, professionalism, etc.  Marketing departments and business schools have responded positively.  For example, one study reported a recent fivefold increase in the number of ethics courses being offered in business schools.  In addition, much marketing curriculum had been designed to equip students with strong communication skills, flexibility, decisiveness, professional skills, and professionalism, by providing more active learning elements in the marketing classroom.


    Large corporations themselves recognize the need for more effective methods of training and education and have begun to adopt newer, active learning designs.  Some industries even recognize that hands-on, or experiential, education inspires students to become innovators.  It is essential, then, that business schools in general, and marketing programs specifically heed these concerns and continue to utilize the most effective educational methods possible to provide students with necessary knowledge and skills.  Continuing to explore and identify characteristics or styles of education that can have the greatest and most permanent impact on students is therefore becoming an increasingly crucial issue.


    This discussion leads to a key question: Are marketing educators, designing courses that maximize the positive outcomes of our students by enhancing student learning and helping them to develop skills necessary for today’s ever-changing environment?  A recent study found that most marketing faculty misperceive their classes in terms of the types of learning elements they have included in their course designs, thinking they are including more of the most effective elements than they actually are.



    The results of this study provide valuable information for business educators on the impact of various course designs on student performance and other student outcomes.  This study indicated both experiential and participative designs (active learning designs) result in more positive student outcomes than did the traditional lecture or passive course design.  Though statistically equal in some cases as the active learning designs, the passive design is never a better design.  In many cases, the traditional lecture design produces statistically inferior outcomes than do the active learning designs.  More specifically, both active learning course designs produce better student grades than does the passive design.  Also, the participative design produces more positive student perceptions of how well the course was conducted.


    The results of this study indicate that professors and instructors of business courses at the higher education level should do their best to build active learning components into their courses.  Participative components are important to help students prepare for making meaningful decisions in their lives and future careers.  Experiential components are important to give students actual experiences with the material they are learning so they will be able to better apply their knowledge to the workplace after their graduation.  
  • Reality TV: When is Enough Enough?


    Within the last few days, several network television reality shows have had completed their seasons.  America's Got Talent just ended with Landau Eugene Murphy, Jr. winning $1 million.  Bachelor Pad also just ended with Michael Stagliano and Holly Durst winning a big chunck of money ($125,000 apiece).  In addition, Big Brother just finished another season and Rachel Reilly was awared $500K.  Whew, finally we get a break from reality TV.  Not!  Simon Cowell's new production, The X-Factor,  starts next Wednesday.  The Biggest Loser also begins a new season next.  There is also Dancing With the Stars, The Sing-off, Survivor, Karoake Battle USA, America's Next Top ModelThe Real Housewives in its various iterations, Basketball Wives, Keeping Up With the Kardashians, etc. 

    For a nearly complete list of reality TV shows, see:  http://www.realitytvworld.com/realitytvworld/allshows.shtml

    Being in and out of rehab for being a reality TV junkie, I can tell you that it is addicting.  With the disappearance of my favorite TV series programs, like Mash (that one shows how old I am), Seinfeld, Friends, Everyone Loves Raymond, Lost, The Event, V, and others, what choice did I have.  My therapist was not very understanding.  Shows are introduced and sometimes disappear after only an episode or two.  Then there is the constant threat of professional sports being on hiatus for whatever reasons.  You can no longer count on anything except reality TV.  (The therapist was not convinced of this either.)  Even though some of these reality programs only last for one season, they at least finish the season and don't leave the viewer hanging.

    So how does all this relate to marketing?  Does reality TV do better marketing research than do other programs before they launch the various products?  Sometimes it appears that way.  So exactly what is reality TV?  It can be described as a genre of television programming that presents supposedly unscripted dramatic or humorous situations, documents actual events, and usually features ordinary people instead of professional actors, sometimes in a contest or other situation where a prize is awarded.  Perhaps this is the big draw.  People can imagine themselves being on these shows and winning big money.  And judging by the numbers of people trying out for such shows as American Idol, it does seem to be the case.  Maybe there is an appeal to these shows that is related to the appeal of playing the lottery or gambling.  The reality TV genre, exploded as a phenomenon around 1999–2000.  Programs in the reality television genre are commonly called reality shows and often are produced in a television series. Documentaries and nonfictional programming such as TV news and sports TV shows are usually not classified as reality shows.

    The genre covers a wide range of television programming formats, from games shows or quiz shows to surveillance- or voyeurism-focused productions such as Big Brother.  Reality television frequently portrays a modified and highly influenced form of reality, at times utilizing sensationalism to attract viewers and increase advertising revenue.  The fantastic ratings many of these productions achieve are often enough to attract the world's top consumer advertisers.  Participants are often placed in exotic locations or abnormal situations, and are often persuaded to act in specific scripted ways by off-screen "story editors" or "segment television producers," with the portrayal of events and speech manipulated and contrived to create an illusion of reality through direction and post-production editing techniques.  This makes it all sound like professional wrestling.  Even with these manipulations of reality by the producers, the programs continue to be wildy popular and it looks like they are not in the Decline Stage of the Product Life Cycle.  We will be able to continue to find a steady dose of reality TV to feed our addictions for many years to come.

  • Missoni for Normal Consumers (Target)

    Missoni is a famous Italian designer brand that regularly sells in high-end stores like Neiman-Marcus and Saks Fifth Avenue for up to $8,000, with an average price hovering close to $800-&1,200.  Now it's in Target for less than $70.  Regular middle-income consumers can now buy products from this high-end designer.  That raises several issues.  Are we, as the type of people who make clothing purchases at places like Target, even aware of high-end brands like Missoni?  And if so, do we care enough to want to purchase them?  That was answered very quickly at a Washington, DC area Target store.  Merely 24 hours after the MIssoni became available in that store, only four items of clothing were left, and they were all products that did not feature the company's signature stripes and zigzags.  In addition to Black-Friday-like runs on the brick-and-mortar Target stores, the Target website crashed several times during the first 24 hours, making it seem like Cyber Monday (the first Monday after Thanksgiving when there is a tremendous increase of online shopping by holiday shoppers).

    Read more:  http://www.washingtonpost.com/local/missoni-for-target-collection-cleans-out-dc-and-new-york-stores-crashes-web-site/2011/09/14/gIQAfmyLSK_story.html

    PLEASE RAIN: Missoni for Target rain boots, $ 34.99. Photo: Target / HC

    Another question that arises is do consumers actually see value in a Missoni product that can be purchased in Target, or do they recognize that such products are likely of less quality than their counterparts bought for hundreds of dollars at Neiman-Marcus?  A partial answer to that is that some buyers of Missoni's Target line are counting on other consumers seeing great value in the Target line.  More than 30,000 items bought at Target are already for sale on eBay with many more on other sites like Craig's List. 

    Read more:  http://www.cnbc.com/id/44535313

    PRINTED: Missoni for Target cotton jacket, $79.99; jersey romper, $29.99; long-sleeve polo sweater, $44.99; space-dye tights, $16; and ballet flats $29.99. Photo: Target / HC

    Another concern for Missoni, and other companies who have similar strategies (for example, Isaac Mizrahi for Target and Vera Wang for Kohl's) is whether this is a good strategy, considering the companies' original product positioning.  In the case of Missoni, its Target strategy is temporary.  Missoni does not plan to send any more women's clothing to Target after its first inventory buildup, and many of the stores are already sold out.  The Missoni strategy does add a feeling of exclusiveness to even the Target version of the brand, thus maintaining a similar product positioning.  However, it does plan to restock the non-clothing items for Target.  So far, the only mistakes being talked about are not those made by Missoni, but those made by Target because of the crash of its website.  However, since the sales in its brick-and-mortar locations are going so well, the online business may be irrelelvant in the end.

  • Pets are People (Consumers) Too

    Workspace personalization in the past most likely featured photographs and other artifacts of human beings.  There were photos of children, best friends, parents, brothers and sisters.  There were also drawings by young children and sayings, such as “World’s Greatest Father,” proudly and prominently displayed.  Though these depictions of our love, affection and memories of human beings have not disappeared, observing workspace personalization nowadays is almost just as likely to feature pictures of favorite pets.  There are also puppy paw prints, examples of animal art, etc.  Where once excitement was high for the birth of a new baby, now it is common to be cooing about a new puppy or litter of kittens.  There was once much bragging about the athletic accomplishments of our human children and friends and now we add great achievements and funny stories about our animal children and friends.


    Consumers in the United States are having their first child later in life.  In 1970, the average age for the first child was 21.4 years of age.  By 2000, that age had increased to 24.9 years of age.  Thus, instead of the early investment in a human baby, people often get started with dogs, cats, birds, fish, and other types of pets.  These pets, then, seem to be filling needs in people’s lives that human children once filled. 


    The plethora of products that are currently available for pets suggests that a trend of humanizing our pets is well under way.  People buy sunscreen and sunglasses for their pets.  They buy wooden, nonskid steps to help their dogs get on the couch or the bed.  They buy specialized food products, such as home-baked PupCakes.  Special pet beds shaped like Crocs shoes are available for dogs.  There are dog clothes, coats, shoes, hats, bags, health insurance, etc.  A pet owner can purchase specialized drinks to help quench the thirst of their dogs. 


    Pharmaceutical companies, such as Pfizer, Novartis and Eli Lilly, now have pet-care divisions that offer products from pain-control medications to antidepressants and weight control pills.  Many product categories once considered the sole domain of human consumers now also feature products for pets.  One pet owner has spent nearly $20,000 on medical expenses for a golden retriever to date, and the dog is not cured yet.  In fact, opposite of many consumer product categories, the industry consisting of products designed to be used for and by pets has grown by an average of nearly five percent per year and is now at about $46 billion.


    Despite the recession, Americans kept spending more on their pets each year, even during the downturn. In fact, they may have become even more attached to their pets because of it. According to the American Pet Products Association, Americans took over $48-billion out of their wallets in 2010 to pay to support their pets’ needs. And those “needs” kept expanding to cover everything from pooch-worth purses to the latest medical technologies to treat every disease and disorder imaginable.


    Statistics show that the number of dogs and cats residing in our households is approaching a three-fold increase in the last four decades, going from 61 million in 1972 to 165 million in 2010. That is a lot faster growth than the 66% growth of the American population in the roughly comparable time period (1970 to 2010), according to the U.S. Census. With 62% of households having at least one pet, it is more common than not to share a residence with a non-human pal. Over the decades, pets have made their way from the barnyard to the backyard to the den to the master bed. During this transition, owners have, understandably, paid a lot more attention to pet grooming needs and overall hygiene.


    However, pet owners’ attentiveness appears to go well beyond the overtly sensory to deep-seated bonding. Dog owners lavish a multitude of pampering behaviors and indulgences on their dogs in ways that cost both time and money or for which they simply spend their time and attention. In most households with dogs, they have truly become another member of the family, with rights and privileges to go along with that status.


  • Use of Consumer Electronics a Signal to Risky Consumer Behavior?

    Recently, juniors and seniors taking a Principles of Marketing class at a large western university were asked how they used their mobile phones.  A flurry of hands went up and the instructor called on the students one by one.  “Texting,” one student said; “Facebook,” another said; “checking email,” one replied.  The responses continued and after letting approximately ten students answer the question, the instructor made the point that not a single one of the students said they used their mobile phone as a telephone, to have an “old-fashioned” telephone conversation with someone.


    Another professor teaching at a large university on the Gulf Coast of Texas walked into a student study area and noticed all the students with their hands seemingly folded in their laps and heads lowered as if they were praying.  A hurricane had just entered the Gulf of Mexico and that is always a major concern, but they hurricane was still days away, so he was puzzled by such behavior.  Upon closer observation, the professor noticed the students all had mobile phones held tightly in their hands and were texting with no concern for the approaching hurricane at all.


    A recent study that surveyed 4,257 high students at 20 public schools reported a connection between certain electronic activities and risky behaviors.  The specific behaviors examined in this landmark study were texting and electronic social networking.  The results suggested, among other things, that excessive activity in these two areas were related to a variety of risky, even unhealthy, behaviors among these high school students.  Hyper-texters (sending more than 120 text messages per day) accounted for nearly 20% of the student population.  This hyper-texters were shown to be 40% more likely to have tried cigarettes, two times more likely to have tried alcohol, 43% more likely to be binge drinkers, 41% more likely to have used illicit drugs, 55% more likely to have been in a physical fight, 3.5 times more likely to have had sex, and 90% more likely to report four or more sexual partners.


    On the other hand, hyper-networkers (spending three hours or more per day on social networking sites) accounted for 11.5% of these high school students.  Hyper-networkers were associated with higher odds ratios for such negative health factors as stress, depression, suicide, substance abuse, fighting, poor sleep, poor academics, television watching, and parental permissiveness.  In addition, hyper-networkers were 62% more likely to have tried cigarettes, 79% more likely to have tried alcohol, 69% more likely to be binge drinkers, 84% more likely to have used illicit drugs, 94% more likely to have been in a physical fight, 69% more likely to have had sex, and 60% more likely to report four or more sexual partners.


    Read more:  http://www.apha.org/about/news/pressreleases/2010/hypertexting.htm


    Using this study as a basis for investigation, a marketing research study was recently conducted.  In this study, it was found that over-use of electronics leads to risky consumer behaviors and attitudes.  Three electronics usage variables and their impact on consumers participating in these risky behaviors were assessed.  These three variables were the total number of electronics devices a consumer owns, the total number of hours per day a consumer spends using these electronic devices, and the total number of hours per day a consumer spends using online social networking sites.  The results of this unpublished study show that the higher consumers score on these electronics usage variables, the more likely they are to be involved with risky consumer behaviors and attitudes, such as consumer complaining, impulse buying, consumer exhibitionism, materialism, status consumption, variety-seeking tendency, and a negative attitude toward business ethics.  Over-use of social networking was an especially strong predictor of these risky consumer behaviors.

  • Market Segmentation: Getting to Know Customers - Really Well

    Market segmentation is the process of dividing up the total market into smaller segments that have similarities that will provide opportunities to develop unique marketing programs.  Some of the similarities in the consumer market might be demographics, such as age, gender, hair color, height, weight, income, education level, ethnicity, religion, etc.   A company may also choose to segment the market based on geographics, which is where people live, work, or play.  Another common base for segmentation is psychographics which is segmenting the consumer market based on people's lifestyles and values.  In reality, most segmentation schemes are not solely based only on one characteristic.  For example, a cosmetics company may segment the market based on gender and income.  If it has an ingredient in its cosmetics that provide sun protection, the company may also use geographics.  Then if the company produces some colors of cosmetics used by unique portions of the population, it may also want to include psychographics.  The results of careful and accurate segmentation should be a segment, or several segments, to which a company can successfullly market its product.

    Developing a very specific segment allows a company to really get to know the consumers included in that segment well.  Companies can find out what media should be used to reach these people with advertisements.  They can learn how the consumers shop and obtain products, so the products can be distributed and offered in the most effective places.  They can learn what price ranges the consumers would be willing to consider paying for the companies' products.  They can also learn what product-related ideas, such as packaging, brandnames, slogans, etc., can best appeal to these consumers.

    Read more:  http://www.netmba.com/marketing/market/segmentation/

    Is segmenting really that important?  Philip Kotler has rightly pointed out that "Markets consist of buyers and buyers differ in one or more respects.  They may differ in their wants, resources, geographical locations, buying attitudes and buying proactices.  Any of these variables can be used to segment a market."  This can be made clear with the help of following figures. Let us assume that there are six buyers in the market with different characteristics as shown below:

    Different Market Segments

    Market segmentation is a customer-oriented approach and is consistent with the marketing concept and relationship marketing. It is an accepted fact that markets are not homogeneous. Consumers differ in their needs and also the manner in which the needs are to be satisfied. For example, clothing is required by all consumers, but all consumers do not wear the same type of clothing. The same is the case with shoes, shampoo, soap, cosmetics and so on. Naturally, manufacturers of each product have to produce different varieties to meet the needs of their various targeted segments.  Specific advantages of going through the process or market segmentation are the following.

    1. Facilitates consumer-oriented marketing: Market segmentation facilitates formation of marketing-mix which is more specific and useful for achieving marketing objectives. Segment-wise approach is better and effective as compared to integrated approach for the whole market.
    2. Facilitates introduction of suitable marketing mix: Market segmentation enables a producer to understand the needs of consumers, their behavior and expectations as information is collected segment-wise in an accurate manner. Such information is purposefully usable. Decisions regarding Four Ps based on such information are always effective and beneficial to consumers and the producers.
    3. Facilitates introduction of effective product strategy: Due to market segmentation, product development is compatible with consumer needs as there is effective crystallisation of the specific needs of the buyers in the target market. Market segmentation facilitates the matching of products with consumer needs. This gives satisfaction to consumers and higher sales and profit to the marketing firm.
    4. Facilitates the selection of promising markets: Market segmentation facilitates the identification of those sub-markets which can be served best with limited resources by the firm. A firm can concentrate efforts on most productive/ profitable segments of the total market due to segmentation technique. Thus market segmentation facilitates the selection of the most suitable market.
    5. Facilitates exploitation of better marketing opportunities: Market segmentation helps to identify promising market opportunities. It helps the marketing man to distinguish one customer group from another within a given market. This enables him to decide his target market. It also enables the marketer to utilise the available marketing resources effectively as the exact target group is identified at the initial stage only.
    6. Facilitates selection of proper marketing programme- Market segmentation helps the marketing man to develop his marketing mix programme on a reliable base as adequate information about the needs of consumers in the target market is available. The buyers are introduced to marketing programme which is as per their needs and expectations.
    7. Provides proper direction to marketing efforts: Market segmentation is rightly described as the strategy of "dividing the markets in order to conquer them." Due to segmentation, a firm can avoid the markets which are unprofitable and irrelevant for its marketing purpose and concentrate on certain promising segments only. Thus due to market segmentation, marketing efforts are given one clear direction for achieving marketing objectives.
    8. Facilitates effective advertising: Advertising media can be more effectively used because only the media that reach the segments can be employed. It makes advertising result oriented.
    9. Provides special benefits to small firms: Market segmentation offers special benefits to small firms. The resources available with them are limited as they are comparatively new in the market. Such firms can select only suitable market segment and concentrate all efforts within that segment only for better marketing performance. Such firms can compete even with large firms by offering personal services to customers within the segment selected.
    10. Facilitates optimum use of resources: Market segmentation facilitates efficient use of available resources. It enables a marketing firm to use its marketing resources in the most efficient manner in the selected target market. The marketing firm selects the most promising market segment and concentrates all attention on that segment only. This offers best results to the firm in terms of sale, profit and consumer support as compared to the results available from spending such resources on the total market.

    Read more:  http://kalyan-city.blogspot.com/2010/07/market-segmentation-importance-in.html


  • Sustainable Sustainival

    Is it possible to power an entire carnival, rides and all,solely on renewable energy? Sustainival, a new venture that does just this was launched earlier in 2011 by entrepreneur Joey Hundert of Edmonton, Alberta, Canada. The business model is very interesting. The premise is that a more eco-friendly approach to carnivals will appeal to many consumers and the remainder will at least think it's pretty neat that this is even possible. There is no doubt that the idea of sustainability (an orientation toward minimizing negative impact business has on people and the environment) is now a big part of the cultural psyche as well as the consciousness of many corporations, large and small. Many government, special interest groups, and corporations are striving for alternatives to fossil fuels, and the need for alternatives seems to resonate with most consumers. So why not bring renewable energy into a more festive environment?

    The carnival operates around the premise that people learn best when they're having a good time.  Building upon this concept, Sustainival seeks to provide people what the company calls a "mild education" while they're being spun, flipped and twirled around.  Copious signage reminds riders that all of the rides are running on renewable energy.  People's comments in surveys at the carnival reveal that this education does take effect; over 95% of Sustainival's carnival goers report that they are aware that the carnival is renewably powered, and that this is important to them.  The amount of uptake of this education is certainly affected by where in the world Sustainival is set up.  The company reports that certain areas around North America are more poised to understand and celebrate the technologies and values expressed in the carnival.  However, the company has found that different aspects of sustainability are important to different people.  For example, when Sustainival toured to Little Rock, AR, they discovered that Arkansans were passionate about nature conservation, and that was their reason for becoming excited about Sustainival.

    The company has almost grandiosly-large plans for the future.  Hundert claims that the goal is to "permanently inspire 100 million people within 10 years time".  He points to the fact that Sustanival has had 750,000 guests in it's first 7 months, impressive indeed.  That leaves 9 years and 3 months for Sustainival to carry out its work. 

  • The Postal Problem

    Those of you keeping up with the news know that the United States Postal Service (USPS) is once again running out of cash. No problem, you say, this happens all the time, so they will simply increase the price of a first class stamp to cover the shortfall. Not this time. The venerable USPS has been to that particular well many times over the past decades. Massive layoffs, office closings, and elimination of Saturday delivery will likely buy the organization a bit more time, but these prescriptions are not a long term solution. The business model is broken. As marketers know, one can only increase the price so much before consumers move to the competition or attempt to find substitutes. Indeed it appears that substitutes, not competition, have driven the USPS to the brink of financial ruin. And, there are so few people using first class mail that an increase in its price will only drive more users to online bill paying, evites, and other forms of electronic communication which, along with other factors, have "creatively destroyed" the need for "snail mail". It is also no small wonder that many observers believe the only variables propping up this outdated business model are the direct mail methods used by marketers, so called "junk mail", since Fed Ex and UPS out maneuvered he USPS in the world of package delivery and have most of the market share. It seems that our mail service failed to foretell the sharp increase in the package delivery industry caused by e-commerce and overall globalization. USPS was too busy delivering the mail to notice. In a world of free competition, USPS would never survive. Now that it the organization's demise appears irreversable, there are several questions we can ask:

    Should the U.S. Government open up mail delivery to private competition?

    Could existing market leaders UPS and Federal Express deliver mail as well as packages? Would they want to?

    Is there still a need for first class mail? Is there a need for direct (junk) mail?

    The following link provides more insight:



  • Supply Chain Responsibilities

    Globalization has had far reaching effects in many industries, as companies in over 190 nations compete for 7 billion customers. One of the more controversial side effects of this phenomenon is the outsourcing of certain functions such as manufacturing, but just as important is the increasing availability of raw materials, such as components and ingredients from places around the world. Nike, Martha Stewart, and a few other high profile brands learned the hard way that a company is responsible for what happens upstream in the supply chain. If you use child labor, stakeholders will hear about it. Underpaying your workers? Stakeholders will hear about it. A bit environmentally-challenged? Stakeholders will hear about it. This means that a marketer must be sure that supplier policies and procedures are in tune with those of the brand. In other words, it's hard to be greener or more socially responsible when your suppliers are not, and a lack of transparency about these activities forces stakeholders to use their imaginations.

    Two different examples related to this have appeared in the mainstream media during the past week or so. Apple is once again on the environmental watchdog list (for the second time this year) for failing to disclose information about its Chinese suppliers. What are we all to think about that? It may appear that the company has something to hide, and transparency has never been one of Apple's strong suits. Quite simply, other companies within Apple's category have been willing to discuss their suppliers with non-government groups and disclose information. Apple has not. Indeed, Apple is responsible for the actions of its supply chain partners and should use its considerable brand leverage to force suppliers to become more environmentally and socially responsible, as Wal-Mart has done. Yes, Wal-Mart. Look it up! The longer Apple ignores this, the more harm will be done to the brand.

    The other notable company in trouble for their supply chain practices is Gibson, makers of fine guitars. Gibson uses ebony and other scarce woods to manufacture its products. These woods are protected by the Lacey Act of 1900 which requires companies to make detailed disclosures about the nature of wood imports and bars the purchase of goods exported in violation of the country's laws (in this case India). Again, this is not the first time that Gibson has been accused of fraudulently labeling its products. Ultimately, consumers will decide whether or not these sorts of things will affect their purchase behavior, but undoubtedly these sorts of activities, in an age of instant communication, are not good for the brands in question.

  • It's All In the Plan

    To many, marketing is just a series of advertising and selling activities peppered with some social media and publicity-generating PR stunts. Those of us who are in the profession, or are learning about it, already know that this is a simplistic view. Marketing is the engine that powers the organization. The primary function of marketing is to generate revenue, although there may be other measurable objectives, and if the marketer fails to meet reveune objectives, there are repercussions that resonate throughout the organization. The failure to generate enough revenue can be seen as a primary variable affecting an organization's employment levels, outsourcing, downsizing, rightsizing, and all kinds of other unpleasant human resource activities.

    Strategic Marketing Planning should begin with a thorough analysis of the situation including both the internal and the external business environments. Internal factors are controllable by the organization and include the mission, organizational structure, operations, production, finance, I/T, R&D, marketing and other functional areas. The result of this analysis can be summarized in terms of Strengths and Weaknesses (SW). The external business environment is uncontrollable and includes analysis of the industry, competition, consumer behavior, legal/regulatory matters, the political environment, technology, the natural environment, social trends, and any other factors that may help or hinder marketing efforts. The result of this analysis can be summarized in terms of Opportunities and Threats (OT). Once the SWOT Analysis has been completed, the marketer can then set measurable objectives. The Marketing Plan's purpose is to achieve these objectives.

    Next, the marketer outlines a 4 P strategy; that is how the marketer will approach Product, Price, Place (Distribution), and Promotional decisions. In many ways, a proper Situation Analysis leads to the proper objectives and the 4 P strategy is simply how the organization plans on achieving these objectives. Product is what the company is selling; price is what the consumer is willing to give up for the product; place is where the consumer can purchase the product; and promotion describes the communication activities used to achieve the aformentioned measurable objectives. The plan is implemented and changes are made to improve the plan for future years. Easy, right? Yes, it is easy to understand marketing planning within this theoretical framework, but writing an effective plan can take many years of experience. Still, the best laid plans somehow fail to be properly executed much of the time, so the marketing plan should be viewed as a "road map" or "blueprint" for the why and the how of achieving marketing objectives. The plan is sure to reduce the risk of failure, but in no way guarantees success.

  • The Marketing Concept and Relationship Marketing

    The marketing concept is often confused with the definition of marketing or another name for the marketing mix or a marketing strategy.  The marketing concept should be inherent in a marketing strategy, but it is a different concept.  The first part of a description of the marketing concept goes something like this.  An organization should commit all its resources to satisfying its customers.  If the description was just that short statement, it would leave much to be desired.

    When I teach about the marketing concept, I stop after this first part of the description.  I say that, like myself, many customers might be extremely cheap and to totally satisfy us, you would have to give me the product for free.  Of course, many marketers are out to make a profit, so that idea wouldn't fly.  Also, this first part of the marketing concept does not take into account the other stakeholders of an organizaiton, such as the employees and the owners/stockholders.  If the company is a for-profit company, it has the responsibility to its owners/stockholders to earn a profit, thus making it impossible for an organizaiton to satisfy its customers if they are like me - cheap.  That brings up another point.  How does an organization know how to satisfy its customers?  The answer is that the organization has to have a specific target market in mind and do research on that target market to understand what motivates it.  The idea of target market research is applicable to both for-profit and non-profit organizations.  So something should be added about still making a profit.  However, that would make the statement applicable to only for-profit companies and we all know that non-profits from hospitals and universities to U.S. military organizations are all involved in marketing.  So we need to add even another element.  The resulting description of the marketing concept, then, would look something like the following.

    An organization should commit all its resources to satisfying its customers, while still making a profit or accomplishing other organizational goals.

    Read more:  http://www.netmba.com/marketing/concept/

    This marketing concept is really suggesting that an organization be as customer-oriented as possible.  To maintain this customer orientation over time, an organization should be involved in relationship marketing.  Relationship marketing is marketing to customers over a long period of time, rather than being focused on a single transaction.  To do this, companies may need to rethink how they compensate their sales forces; they may need to be more conscious of long-term benefits, rather than short-term profits; they may need to devise different promotional strategies that involve longer term elements, such as hiring and training personable salespeople who develop close relationships, rather than things like coupons that expire in a month.  Every time an organization loses a customer, it takes time and expense to replace that customer, so efforts should be made to retain customers through long-term customer satisfaction and relationship-building efforts.

    Read more:  http://www.webtrends.com/upload/wp_relationshipmarketing.pdf

  • HP Tries To Be Clever?


    Hold everything! Now it turns out that Hewlett Packard (HP to friends) will "temporarily" resume manufacturing its TouchPad after announcing several days ago that it would severely cut prices and move out all excess inventory before discontinuing the line. The company was clearly shocked at how fast those units were sold by retailers who were motivated to relieve themselves of the unwanted inventory in a discontinued line. Of course a 75-85% off sales promotion probably helped as well so I'm not sure about what is so shocking about dumping products on the market. The question now is why HP has decided to reanimate the product even if only for a brief period of time. The marketing term that we generally use when a product is sold up until the point where profits become negative is "harvesting", and the idea is to get as much as you can out of a line before discontinuing it.  Thus, HP sees an opportunity to "harvest" more profit from the brand and has decided to leverage the incredible amount of publicity generated by their "shocking" announcement to make and sell more TouchPads.

    But don't expect the $99 dollar price tag to stick. I don't think this price point leaves any profit margin to justify actually MAKING more TouchPads. But if it does stick, there must be a reason as to why HP would continue selling these things as a loss. It simply doesn't make any sense. And, of course the company is mum about how many or how soon the new products will be available, adding to the hype and mystique. Thus a public relations campaign is born. HP didn't have to spend millions advertising this promotion. The media did it all for them for free. Encouraging the media to promote your product is much more effective than advertising, since the press is generally perceived to be more believable than company communications. Remember that this temporary reversal comes in the midst of an overall strategic shift announced by the company away from more commoditized hardware products and towards the more lucrative services area, so this move must be viewed within a larger strategic context. Whatever all that means!

    What is HP up to?

    Is this all a clever plan for global domination?

    Or is this simply another of many missteps made by the company over the past decade?