Services and Other Intangibles:
The double intangible has come to mind when thinking about services and other intangible goods. Hulu: TV that is streamed online. TV is entertainment which is ungraspable and the internet itself is also an intangible good. The difficult part of this is deciding how to market this doubly intangible good. A strong perception of the benefits received will have to be built in order to attract consumers to websites like these. Luckily with the shift to online life, if you will, there has been an explosion of popularity with sites such as Hulu and there is not a lot of need for promotional campaigns. Now however, Hulu is changing their product line a little by adding a tangible good to their services, a box for at home viewing. A bundling strategy.
How does one market a doubly intangible good? Why through another intangible service, the television of course! You can see commercials for Hulu on TV frequently nowadays.
Wednesday, December 15, 2010
Tuesday, December 14, 2010
Chapter # 9
Pricing Your Product:
Price skimming is the process where a company introduces a product line into the market at a high price and lets those willing to overpay do so before lowering the cost to appeal to the mass consumer base. Most commonly you will see this strategy with technology. A good example of this is laptops, a new model comes out each year at minimum and the older models move down a price level, leaving those who have waited with a better deal.
My question for the strategy of price skimming is this: will this strategy be effective for a new or start up company? I suppose that if a new company had a high in demand technology then it is possible they could use this as a way to enter the market. To implement this tactic would be the opposite of penetration pricing and would require the proper advertising in order to spread the word about the new product. The benefits of a new company using this and bringing something new to the table is that it may take competitors some time to catch up technologically, giving the newbies time to grab ahold of the market.
Price skimming is the process where a company introduces a product line into the market at a high price and lets those willing to overpay do so before lowering the cost to appeal to the mass consumer base. Most commonly you will see this strategy with technology. A good example of this is laptops, a new model comes out each year at minimum and the older models move down a price level, leaving those who have waited with a better deal.
My question for the strategy of price skimming is this: will this strategy be effective for a new or start up company? I suppose that if a new company had a high in demand technology then it is possible they could use this as a way to enter the market. To implement this tactic would be the opposite of penetration pricing and would require the proper advertising in order to spread the word about the new product. The benefits of a new company using this and bringing something new to the table is that it may take competitors some time to catch up technologically, giving the newbies time to grab ahold of the market.
Chapter # 12
Place: Distributing the Product
http://www.youtube.com/watch?v=JTJLhWGVQQs
This is an example of a Just in Time system. I think that this technology is the most interesting method of distribution in this chapter. The novel concept that being one unit of over of your product is the same level of inefficiency as being one unit short is intriguing. This analysis is based off of the idea that because production leaving the factory is exact, there is no room in a plant for costly and disrupting storage area. Along with JIT systems it is not just the production of the goods that must be exact, but also the materials coming into the production plant as well. Multiple parties are involved in and benefit from the Just in Time systems.
http://www.youtube.com/watch?v=JTJLhWGVQQs
This is an example of a Just in Time system. I think that this technology is the most interesting method of distribution in this chapter. The novel concept that being one unit of over of your product is the same level of inefficiency as being one unit short is intriguing. This analysis is based off of the idea that because production leaving the factory is exact, there is no room in a plant for costly and disrupting storage area. Along with JIT systems it is not just the production of the goods that must be exact, but also the materials coming into the production plant as well. Multiple parties are involved in and benefit from the Just in Time systems.
Chapter # 11
Promotional Strategy
I think that guerrilla marketing can be incredibly effective. More and more of the purchasing power is being shifted into the hands of up and coming consumers who have shorter and shorter attention spans. We need an advertisement to surprise us and catch us off guard. I do think that it can be dangerous though, if a high-end company that depends on prestige products as their main seller does a cheap gimmick then they could damage the value that they have worked to create.
For a company like Swatch, that does produce nice products that are high quality and durable but not luxury goods, it is effective to do campaign ads like this. They also have a large line of children's and teen's watches that a massive watch on a building might appeal to.
Monday, December 13, 2010
Chapter # 4
This is a robot. This robot is designed to shop for the elderly. When the elderly get too old to do their own shopping they sit at home and, using wireless technology, steer the robot to do their bidding for them. It also has telephone capabilities to talk to its companion.When looking at the consumer decision making models I am sure that an elderly person would not buy this. Sure, your potential affinity to this product will depend on culture, but I am almost positive that a senior citizen would be overwhelmed by the technologies needed to properly work the telephone and extensive remote controls needed to operate a life-sized robot.
The product itself is not connecting with lifestyle or personality traits of their target market. And when looking at the internal influence of learning there is a large discrepancy between the knowledge needed to properly use the product, and the willingness of the market to learn. This is a huge oversight when bringing this product to market.
Chapter # 3
My office has recently made the switch to use an outside company to provide the support, advising and technical services for our Online Masters of Business Administration students. The company, EMBANENT, is trained as WSU advisors and the workers are familiar with our programs here. They merely have the manpower to properly administer to the volume of current and prospective students that our program is seeing. With the growing boom of Internet schooling WSU Graduate Programs in Business has begun to offer the online degree, which has been received quite positively.
Before these two big decisions could be made (offering an online degree and then requesting a third party to provide support) we did our research. Through primarily syndicated research our office became aware of the demand that an up-and-coming market would provide. Our generation is looking more and more towards college online as a viable option and the studies have shown this. WSU has responded. However, once this program’s potential was seen we took things one step further. Embanent is a company that not only does support and advising after proper training, but they also market your program out to students across the nation. They are able to reach more of the target market than our team would alone. Research shows that students need roughly 8 interactions before they are willing to attend your university. With our small team we are unable to provide the high level of interaction that market research tells us we need to provide. Embanent can fill this gap for us.
These major decisions were a direct reaction from looking at the research telling our business that we needed to expand to a new market and do so with the proper amount of attention.
Sunday, October 31, 2010
Chapter # 8
Manage the Product
http://www.accessmylibrary.com/article-1G1-179934995/effect-cigarette-advertising-bans.html
Product Life Cycle: Cigarettes
I am very interested by the Product Life Cycle of tobacco products, specifically in the Western World. Based upon observations, I would say that cigarettes are in the decline stage, however there is some debate about whether they are still in the maturity stage. Regardless, they are headed towards the decline stage quickly if not already there. But the interesting aspect of their decline is that the companies that produce cigarettes and other tobacco products face legislation that stifles many of the campaigns that other companies would try in the decline stage. They have many laws limiting their advertising liberties. I am interested to see what these companies will do as legislation only gets tighter and their sales continue to drop. Intense product placement? Invest more heavily in markets overseas?
http://www.accessmylibrary.com/article-1G1-179934995/effect-cigarette-advertising-bans.html
Product Life Cycle: Cigarettes
I am very interested by the Product Life Cycle of tobacco products, specifically in the Western World. Based upon observations, I would say that cigarettes are in the decline stage, however there is some debate about whether they are still in the maturity stage. Regardless, they are headed towards the decline stage quickly if not already there. But the interesting aspect of their decline is that the companies that produce cigarettes and other tobacco products face legislation that stifles many of the campaigns that other companies would try in the decline stage. They have many laws limiting their advertising liberties. I am interested to see what these companies will do as legislation only gets tighter and their sales continue to drop. Intense product placement? Invest more heavily in markets overseas?
Saturday, October 30, 2010
Chapter # 7
Create the Product: Innovation
And interesting aspect of product development is the idea that the full phases of new-product development, from idea generation to commercialization, are completed by one company and the benefits can be taken by another. The idea of generic brands and knock-offs.
As talked about in the chapter frequently there is a very high cost associated with putting a new product or service on the market. Market research, testing and technical development are costly and not all companies have the financial resources to do so. It is not unseen to see one company initially take on this task and develop a great idea but due to factors in the market another company is able to use their research to their own advantage. This is commonly seen when looking at the drug industry. Due to trust in the FDAs approval it is very easy for consumers to transition quickly to the generic brand after the initial twenty years where the brand name has exclusive rights. A great example of this is with the drug ibuprofen. The brand name of this is Advil or Motrin. So many consumers buy ibuprofen today that it has now almost turned into a brand name of its own.
And interesting aspect of product development is the idea that the full phases of new-product development, from idea generation to commercialization, are completed by one company and the benefits can be taken by another. The idea of generic brands and knock-offs.
As talked about in the chapter frequently there is a very high cost associated with putting a new product or service on the market. Market research, testing and technical development are costly and not all companies have the financial resources to do so. It is not unseen to see one company initially take on this task and develop a great idea but due to factors in the market another company is able to use their research to their own advantage. This is commonly seen when looking at the drug industry. Due to trust in the FDAs approval it is very easy for consumers to transition quickly to the generic brand after the initial twenty years where the brand name has exclusive rights. A great example of this is with the drug ibuprofen. The brand name of this is Advil or Motrin. So many consumers buy ibuprofen today that it has now almost turned into a brand name of its own.
Chapter # 6
Sharpen the Focus: Target Marketing
http://www.youtube.com/watch?v=M11SvDtPBhA
When segmenting according to an age demographic it is interesting to look at the power that children and teenagers have. It would be foolish as a company to not try to put yourself in their field of vision. I think that one of the best illustrations of an attempt to make an impression on a young demographic by a hurting company is GM's presence in Miley Cyrus' music video "Party in the U.S.A." As a company that is trying to reposition itself in the consumers mind after the problems it encountered in the past few years it is wise to try and begin this process with children. If they can successfully create a positive image, for tweens especially as they enter their driving years, then they will have a relatively loyal market based upon image alone.
In the video Miley is portraying an image of carefree American youth. She is doing so while dancing on and around Chevys, GMs as well as their sport model of the Cadillac. This is a great idea, as a national icon for younger children across the nation Miley holds a lot in influence. Her presence around these products is a great promotional tool. Product placement is a smart way to target this specific demographic.
http://www.youtube.com/watch?v=M11SvDtPBhA
When segmenting according to an age demographic it is interesting to look at the power that children and teenagers have. It would be foolish as a company to not try to put yourself in their field of vision. I think that one of the best illustrations of an attempt to make an impression on a young demographic by a hurting company is GM's presence in Miley Cyrus' music video "Party in the U.S.A." As a company that is trying to reposition itself in the consumers mind after the problems it encountered in the past few years it is wise to try and begin this process with children. If they can successfully create a positive image, for tweens especially as they enter their driving years, then they will have a relatively loyal market based upon image alone.
In the video Miley is portraying an image of carefree American youth. She is doing so while dancing on and around Chevys, GMs as well as their sport model of the Cadillac. This is a great idea, as a national icon for younger children across the nation Miley holds a lot in influence. Her presence around these products is a great promotional tool. Product placement is a smart way to target this specific demographic.
Chapter # 5
Business to Business Marketing
When reading through the different types of buying situations I decided to apply them to my work organizations recent purchases. Comparing what we purchase to "straight re-buy," "modified re-buy," and "new-task buy." I work for Graduate Programs in Business at Washington State University. Our office sells education so we do not purchase many goods, however we do purchase things that are needed to keep our office running. An example of a straight re-buy for us would be the purchase of office supplies from WSU's central stores. We buy from them every time, and know that it will be delivered quickly and at an affordable price. A modified re-buy for our team would be the purchase of a new copier. Ours has been inconsistent at best for some time and the decision was made to acquire a new one. We have shopped around for the proper fit, looking specifically for the most competitive price and the highest performance standards to fit our needs. Lastly, a new-task buy for Graduate Programs would be the outsourcing of our admissions help for our growing online programs. We have a company that is now under the WSU brand name that has undergone extensive training in order to assist with large volumes of inquiries for our Online MBA program. This hiring/service purchasing decision was brand new, took extensive research and we are still in the process of creating a relationship with the men and women on this separate team.
When reading through the different types of buying situations I decided to apply them to my work organizations recent purchases. Comparing what we purchase to "straight re-buy," "modified re-buy," and "new-task buy." I work for Graduate Programs in Business at Washington State University. Our office sells education so we do not purchase many goods, however we do purchase things that are needed to keep our office running. An example of a straight re-buy for us would be the purchase of office supplies from WSU's central stores. We buy from them every time, and know that it will be delivered quickly and at an affordable price. A modified re-buy for our team would be the purchase of a new copier. Ours has been inconsistent at best for some time and the decision was made to acquire a new one. We have shopped around for the proper fit, looking specifically for the most competitive price and the highest performance standards to fit our needs. Lastly, a new-task buy for Graduate Programs would be the outsourcing of our admissions help for our growing online programs. We have a company that is now under the WSU brand name that has undergone extensive training in order to assist with large volumes of inquiries for our Online MBA program. This hiring/service purchasing decision was brand new, took extensive research and we are still in the process of creating a relationship with the men and women on this separate team.
Monday, September 6, 2010
Chapter # 2
http://www.youtube.com/watch?v=Z_jWgzGjkrY&feature=related
Business planning is defined as an ongoing process of decision making that guides the firm both in the short term and the long term. Netflix provides a unique example this. You can see in the interview with Reed Hastings, CEO of Netflix, that from the very beginning of this corporation that they had a business plan for the long term. Their initial plan was to be a company that provided online streaming of movies. But in 1997, the year that Netflix began, no one knew exactly where the internet would go or how fast it would progress. In order to grow as a company and develop a consumer base they invested all their capital in dvd rental. The business plan is brillant; creating a consumer base in the millions by offering a known product, so that when the timing was right they shifted their product focus onto a new type of medium. To have a business plan that required suspending the original goal for an unknown number of years and to have invested in a related market until technology caught up shows tremendous foresight by the companies founders.
Business planning is defined as an ongoing process of decision making that guides the firm both in the short term and the long term. Netflix provides a unique example this. You can see in the interview with Reed Hastings, CEO of Netflix, that from the very beginning of this corporation that they had a business plan for the long term. Their initial plan was to be a company that provided online streaming of movies. But in 1997, the year that Netflix began, no one knew exactly where the internet would go or how fast it would progress. In order to grow as a company and develop a consumer base they invested all their capital in dvd rental. The business plan is brillant; creating a consumer base in the millions by offering a known product, so that when the timing was right they shifted their product focus onto a new type of medium. To have a business plan that required suspending the original goal for an unknown number of years and to have invested in a related market until technology caught up shows tremendous foresight by the companies founders.
Chapter # 1
I think that this first chapter was a great introduction to the field of marketing. While there are some principales that I have been familiar with for some time it is interesting to learn the terminology that is associated with them. However, my favorite part of the chapter was the response to the criticism that "Marketing corrupts society." The rebuttal simply explains the difference between a want and a need. We have natural needs, those will always be present. Marketing a product is simply telling the consumer how we should satisfy those needs, i.e., with their products. I like how simple this idea is. Commonly you hear that we are living in a world consumed with "things" when in reality we are the people that continue to find our identity in these possessions. We let our products define how others perceive us. Marketing is just selling an image, we are the ones that decide to adhere to it. "We tend to think of ourselves as rational decision makers, calmly doing our best to obtain products and services that will maximize our health and well-being and that of our families and society. In reality, however, our desires, choices and actions often result in negative consequences to ourselves and the society in which we live." These couple passages left me with a good amount of food for marketing thought.
Subscribe to:
Posts (Atom)