http://www.economist.com/businessfinance/PrinterFriendly.cfm?story_id=14973087
Summary
The article is about how normally Black Friday (the Friday after American Thanksgiving) is the period when companies start making money -being in the black- but this year, because of the recession, consumers have become more value conscious and are abandoning normal stores in favor of online retailers. It also talks about how growth in retail sales is slow and contrasts that with the quick and rapid growth of online retailing. Finally, it talks about how brick and mortar retailers plan on responding to online retailing. Some examples are bundling things unsellable online such as music lessons in Best Buy's case or yoga classes with Lululemon.
Connections
Firstly, there is a section in chapter one that lists the channels of distribution for products. One of those channels is the integrated channel. The article says that companies that produce products but don't have stores can sell their products online now because of online retailing, thus making an integrated channel of distribution. Another connection would be the online retailer's lack of a location. Online retailers don't need to worry about whether their store too close to an overpass or not far enough from the industrial parks. Their lack of a need to choose a good location also helps them cut costs and possibly transfer the savings onto customers.
Reflections
I think that it's interesting that even though there's so much hype about online retailing in the article, it only accounts for 6% of all sales in the United States and will only be at 8% by 2013. The article states that Amazon's sales reached 5.5 billion dollars in the third quarter of the year. It really makes me wonder about how large the sales money is altogether, if you include brick and mortar retailers, online retailers, and itinerant retailers. I think that retailers are learning their lesson too late. Black Friday is an important time for retailers and you would think that they learned a lesson last year on Black Friday that online retailing is growing fast and might be a large threat to business.
Wednesday, December 2, 2009
Tuesday, November 3, 2009
Shockvertising
Summary
The article is about "shockvertising", a new way of advertising which intentionally seeks to annoy, scare or otherwise make people shocked. The article also states that this form of advertising, hereafter called "shockvertising" will become more prevalent as advertising gets more and more cluttered. Finally it warns potential marketers about having to draw a fine line because if it is just plain offending then there will probably be a backlash against the company. For example, a woman sued Toyota for $10 million because she thought that she was being stalked as part of a "Terror Marketing" campaign. This campaign included e-mail and videos which upset the woman.
Connections
The article mentions the need to draw a line between what isn't offensive and what is offensive. While I agree that it has to be done, for different people, the line is at different places. That is why a company that plans on doing a "shockvertising" campaign must do careful market research in order to reach their target market. That leads me to my connection, in the textbook, it mentions niche marketing which is marketing to very specific people. Shockvertising and niche marketing both need careful market research in order to reach their target market. If they don't then the conseqences are essentially the same, the company loses money through ads that are considered either offensive enough for someone not to buy a product or service or reaching a market that is simply not interested in the product or service.
Reflections
Personally, I think that shockvertising is like a Pandora's Box. With all the ads that we see each day, we really don't pay attention to ads anymore unless they are really memorable. With shockvertising, more ads will be memorable, which leads to more market awareness of the company doing the advertising. It's inevitable that some people will be very offended and some people will be just plain pissed off, however in general if an ad is really offensive, funny or stupid then people will start talking about it, which means the marketers' jobs are done.
The article is about "shockvertising", a new way of advertising which intentionally seeks to annoy, scare or otherwise make people shocked. The article also states that this form of advertising, hereafter called "shockvertising" will become more prevalent as advertising gets more and more cluttered. Finally it warns potential marketers about having to draw a fine line because if it is just plain offending then there will probably be a backlash against the company. For example, a woman sued Toyota for $10 million because she thought that she was being stalked as part of a "Terror Marketing" campaign. This campaign included e-mail and videos which upset the woman.
Connections
The article mentions the need to draw a line between what isn't offensive and what is offensive. While I agree that it has to be done, for different people, the line is at different places. That is why a company that plans on doing a "shockvertising" campaign must do careful market research in order to reach their target market. That leads me to my connection, in the textbook, it mentions niche marketing which is marketing to very specific people. Shockvertising and niche marketing both need careful market research in order to reach their target market. If they don't then the conseqences are essentially the same, the company loses money through ads that are considered either offensive enough for someone not to buy a product or service or reaching a market that is simply not interested in the product or service.
Reflections
Personally, I think that shockvertising is like a Pandora's Box. With all the ads that we see each day, we really don't pay attention to ads anymore unless they are really memorable. With shockvertising, more ads will be memorable, which leads to more market awareness of the company doing the advertising. It's inevitable that some people will be very offended and some people will be just plain pissed off, however in general if an ad is really offensive, funny or stupid then people will start talking about it, which means the marketers' jobs are done.
Friday, September 18, 2009
CH 1- The Rise of Private Labels
http://www.nwaonline.net/articles/2009/08/19/business/082009busprivatelabels.txt
Summary
This particular article is about Wal-Mart and "private label brands". Private label brands are the brands in those stores that are owned and sometimes produced by those retailers. The article is mainly about how Wal-Mart and are re-making their private brands so that they can compete better with "national" brands such as Coca-Cola and Lay's. It also talks about the new products and the expansion of these brands. For example, "Great Value" from Wal-Mart is adding things like vegetable medley frozen pizza and chocolate waffle cone individual ice cream cups.
Connections
First, the article mentioned the re-making and re-flavoring of hundreds of it's products and the introduction of lots of new products. In order to re-flavor something then Wal-Mart would need direct control over production of their products. With Wal-Mart's new strategy, it would move towards another channel of distribution, resulting in Wal-Mart having two channels of distribution for its products. The first one would be the normal channel of distribution with the producer-wholesaler-retailer-consumer channel and the second would be the
producer-retailer-consumer channel.
Reflections
Personally i think that its time that Wal-Mart stepped up its private brands because in a bad economy, people aren't willing to spend more on new things and tend to live more frugally. After all, if a more expensive product with flashier packaging is compared to something with just a white background, people get suspicious and start to wonder if they're paying for packaging. On the other hand, more products means that all the Wal-Marts will probably get bigger which is normally good although there should be limits. I remember one time my family went shopping at Wal-Mart which have huge stores. We split up and my grandparents went to go look for oatmeal and things like that. The Wal-Mart was so big that they ended up getting lost and it took an extra hour to find them.
Summary
This particular article is about Wal-Mart and "private label brands". Private label brands are the brands in those stores that are owned and sometimes produced by those retailers. The article is mainly about how Wal-Mart and are re-making their private brands so that they can compete better with "national" brands such as Coca-Cola and Lay's. It also talks about the new products and the expansion of these brands. For example, "Great Value" from Wal-Mart is adding things like vegetable medley frozen pizza and chocolate waffle cone individual ice cream cups.
Connections
First, the article mentioned the re-making and re-flavoring of hundreds of it's products and the introduction of lots of new products. In order to re-flavor something then Wal-Mart would need direct control over production of their products. With Wal-Mart's new strategy, it would move towards another channel of distribution, resulting in Wal-Mart having two channels of distribution for its products. The first one would be the normal channel of distribution with the producer-wholesaler-retailer-consumer channel and the second would be the
producer-retailer-consumer channel.
Reflections
Personally i think that its time that Wal-Mart stepped up its private brands because in a bad economy, people aren't willing to spend more on new things and tend to live more frugally. After all, if a more expensive product with flashier packaging is compared to something with just a white background, people get suspicious and start to wonder if they're paying for packaging. On the other hand, more products means that all the Wal-Marts will probably get bigger which is normally good although there should be limits. I remember one time my family went shopping at Wal-Mart which have huge stores. We split up and my grandparents went to go look for oatmeal and things like that. The Wal-Mart was so big that they ended up getting lost and it took an extra hour to find them.
Monday, September 14, 2009
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