In response to Kristen's post

The electronic industry is all about Planned Obsolescence. The main goal of this type of production is to ensure that consumers will have to buy the product multiple times, rather than only once. How many iPhone models are there now? Apple has been plagued with accusations and investigations about its business practices. Its shareholders are upset because Apple has billions in cash and has paid little in dividends. If I upgrade to a smart phone, it will not be an Apple product. My taste toward tech is price rather than the newest product.  

America for Sale

I just came across this article today on NBCNews.com. It is about an immigration program called the EB-5 visa program. It allows foreigners to earn a green card granting them permanent residency and a citizenship. In addition to the usual bureaucracy, this path to citizenship, costs at least a $500,000 investment in an American business and the creation of at least 10 jobs.

Everybody knows that money talks but is buying your way to the head of the citizenship line a fair process? Is buying your way into America a process that all its citizens should know about? I’m curious to know how this program is marketed, if at all, to other countries. What do you think?

In response to Gina's post

Unforgettable Advertisements

Many of these commercials are a form of guerrilla marketing. Wikipedia defines Guerrilla marketing as an unconventional system of promotions that relies on time, energy and imagination rather than a big marketing budget. Typically, guerrilla marketing campaigns are unexpected and unconventional, and consumers are targeted in unexpected places. Because there are so many commercials in so many forms they have almost become unnoticeable. By using outside the box tactics, some companies are trying to grab your attention in hopes you’ll remember their product in your purchasing decisions.

Captive audience

Everything costs more and those costs keep rising. Those rising costs affects everything including the things some people think are free. Have you ever considered how much public school costs and where the money for these schools comes from? With more of the public unwilling to adequately fund public schools and with state education budgets being slashed, school administrators are seeking alternatives sources for revenue. One alternative is allowing private and commercial advertisements in schools.

Marketing experts can reach this captive audience in many ways; in schools ads, ads in classroom materials and programs, and corporate sponsored educational materials and programs.

Is the commercialization of our education system a good idea?

In response to Kristen’s Post

When a company uses something like this in advertisement do you feel you are more likely to purchase it?

Advertisements are designed to convince you to buy a particular good or service. Catch phrases and slogans are just one tool that is used to change your buying behavior. Throughout my career as a consumer I’m have no doubt that an advertisement or a marketing campaign has changed my buying behavior in favor of a product. Even though my consumer tastes are well established, I’m sure there will be an ad in the future that will convince me to change those tastes.  

We're #1

Last week’s post was how the millennials in the US have turned their buying power in favor of American cars. I’d like to continue this week with the same topic. I found an article that R.L. Polk & Co. revealed that the Ford Focus is the world’s bestselling car. Ford has 3 vehicles that made the top ten list. The success of the Focus lies in part to a 51% increase in sales in China.

Is price the contributing factor for Ford or is there some other reason that the Focus came out on top?

http://editorial.autos.msn.com/blogs/autosblogpost-ros.aspx?post=619afc64-1886-4110-a3f0-a1df03b47726&icid=autos_4180

In response to Allison Ray

I don’t understand why people buy bottled water when for only a few cents you can drink tap water. OK, I realize that tap water doesn’t always taste good, but this can be solved with a simple and inexpensive filtration system. When you buy bottled water where do all those bottles go? According to Pristine Planet, just over 20% of those water bottles get recycled which means the rest get thrown away. So much for going green. Is the convenience of bottled water worth the price?

American Made

I found an article on nbcnews.com that I thought was interesting. It says that the baby boomers shifted their loyalty from American cars to foreign cars. Better gas mileage and reliability were the driving force behind this shift. It seems now that the millennials have reversed this shift in favor of American cars. Data shows that Japanese makers have seen their share among 18 to 24 years olds decline by 9.8 percent since 2008. It seems that looks is everything for these young buyers claiming that the American cars look cooler and are a lot more fun to drive than the foreign competition.  

Toyota created Scion, a line of vehicles marketed directly to the younger buyer. What else can foreign auto makers do to regain the young car buyer?

In response to Katie Longchamp

What are some other products that you can think of that can use an undifferentiated strategy to market their products?

The first product that comes to mind is beef. In the early 90’s the beef council ran ads with the following slogan, “Beef. It’s what’s for dinner.” Ads for travel, like the ones for Michigan, California and Jamaica and auto insurance fit into this category.  Their mass marketing effort gives them more bang for the buck.  

Is there a way that the beef council can use a different strategy?

Sheep or a Wolf

Have you ever wondered, outside of a marketing class, why you buy what you buy? There are of course needs which have to filled however much of what we spend goes way beyond needs. It could be argued, and I’m sure it has, that an IPad and a pair of Jimmy Choo’s are needs. Think about your gym membership which you visit so infrequently. Americans spend an estimated $330 billion a year on clothing. We buy for the life we want to have—cocktail dresses for parties we never go to or fancy new workout clothes for the gym we never visit. Another estimate says that we spent about $370 million last year on our pets Halloween costumes. By playing on our delusions and our fears, companies tempt us to shell out for needless items, and that can be a burden on our finances.

I have bought and will continue to buy things which go beyond what I need. I'm not suggesting that you stop buying things you want, but perhaps a little thought might be given to what you need before you buy your next bottle of vitamin water.

When you buy stuff, do you follow the crowd like a sheep, and buy what everyone else does? Yoga pants and Uggs comes to mind. Or do you defy convention and follow your own path?

 

In response to Gina's post

Reference groups are only one tool that can help you with a buying decision. For some, buying decisions require a lot of thought to analyze all the information about a particular product. Most people respect the opinions of the people they are closest to and these opinions can be a good starting point in your buying decision making process.   

Truth in advertising

I found this ad for American Eagle Outfitters. (Please watch) http://creativity-online.com/work/american-eagle-outfitters-skinny-skinny-jeans/31047 It is an ad for skinny jeans. At the end of the video there is a link to the AEO website. When you try to purchase these jeans, a pop up informs you they are out of stock and if you give them your email they will let you know when they are back in stock.  

This has probably generated a lot of traffic to their web site and perhaps even some purchases of products that are “in stock”, which is their intent. But is this type of ad fair to consumers? Does it cross any ethical or legal boundaries?

In response to Haley’s post

I used bundling or packages all the time in my business. By showing products together and how they are related to each other and selling those products at a reduced price by bundling them is a good way to provide the customer with products at a good price. Most people are looking for a “good deal” and this usually includes getting more for less. Tools are a good example of bundling.

Product Placement

Aren’t commercials enough? Do we really need to watch our favorite show, see a movie or catch the game without having all those name drops and visualizations of products? I personally don’t care if all the vehicles on TV show are Chevrolets. It doesn’t matter if someone is drinking a Coke instead of Pepsi. Is it going to influence your buying decisions if there is a Nike swoosh on your favorite, or not so favorite, college basketball team? (March madness you know)

I hope that people realize that an arrangement, usually involving money, was made so that those products can be in all those places I mentioned and that the characters on TV and in movies did not choose those products themselves.

Just one more question. Does product placement make a difference for you?

In response to Kerri’s post.

I agree, customer service is an important part of the product. With the development and wide use of mobile and computer based technology it is easy for anyone to search, research and compare products. If you choose to go to an actual store to make your purchase one important aspect of your shopping experience is the customer service. Employees that are glad and capable of helping you with your purchase can differentiate that business from others. Even on line shopping has to ensure the customer is happy; availability of the product, ordering procedures, shipping and shipping cost, return policies and even the design of the web site can make or break a sale. With the buying process becoming more impersonal, customer service is more important than ever.    

Packaging serves many purposes, one of which is a place to put a label. For food product this label includes nutritional information. The Nutritional Labeling and Education Act of 1990 made this type of information mandatory. Many of the ingredients are pretty straight forward, water sugar, sodium etc. Then of course there are all those chemical names. But one ingredient has always been difficult for me to understand, natural flavoring.

The FDA defines it as follows: The term natural flavor or natural flavoring means the essential oil, oleoresin, essence or extractive, protein hydrolysate, distillate, or any product of roasting, heating or enzymolysis, which contains the flavoring constituents derived from a spice, fruit or fruit juice, vegetable or vegetable juice, edible yeast, herb, bark, bud, root, leaf or similar plant material, meat, seafood, poultry, eggs, dairy products, or fermentation products thereof, whose significant function in food is flavoring rather than nutritional. Natural flavors include the natural essence or extractives obtained from plants listed in subpart A of part 582 of this chapter, and the substances listed in 172.510 of this chapter. http://www.accessdata.fda.gov/scripts/cdrh/cfdocs/cfCFR/CFRSearch.cfm?fr=501.22
I think I’m more confused now. Does this make any sense to anyone? Should ingredients be clearer?

In response to Caitlyn’s post.

Many companies are having issues with profits and stock prices, in large part because of the increase in payroll taxes. These taxes hit twice, the consumer has less money to spend and the employer has to pay more.  Wal-Mart is very good at reading customers' shopping habits and adjusting quickly. You may see stores adjusting inventory toward lower-price items and smaller-packaged goods trying to maintain customers. I don’t think Wal-Mart is down for the count.

NAFTA

Government policies are complex and the information we receive about them is sometimes bias. Our text, Lamb, Hair, McDaniel (2013). Marketing What’s Inside, paints a picture of increased prosperity for all involved.  I found a couple of web sites that paint a very different picture. The links are below so rather than repeat the information I will just summarize.

*The US was able to move jobs to lower cost Mexico. Outsourcing.

*Mexico lost 1.3 million farm jobs because they couldn’t compete with the low priced products      coming from the U.S.

*Mexico environment deteriorated because the agribusiness used more chemicals to try to increase crop outputs.

*Mexican truck travel is limited to 20 miles within the US however, U.S. trucks, although they do not comply with restrictions imposed by the Mexican government, have unlimited access across Mexico.

Does free trade mean fair trade? There are a lot of web sites with a lot of information, you decide.  

http://useconomy.about.com/od/tradepolicy/p/NAFTA_Problems.htm

http://www.citizen.org/documents/NAFTA_10_mexico.pdf

In Response to Haley's post

Haley asked,Have you ever found yourself being persuaded to purchase a product after noticing the ads while surfing the internet?

I have mixed feelings about these targeted ads. It is invasive for “someone” to know exactly what I have been searching for on the net. Privacy is important to many people. But does it really matter that “they” know you are looking for a new pair of shoes?

I have looked at some of these ads but I have never bought anything because of them. Information is important in the buying process. Knowing what is available can help you make the best buying decision.

Should these types of targeted ads be restricted from children? How do they know the age of the person doing the shopping?

Purchasing Power

Marketers bombard us every day with messages about products and services they want us to buy. These messages use many different techniques to try to get us to spend our money on their products. Much of the money we spend is used for necessities, food, clothing, and shelter. The money we have left over is considered “disposable income”. Regardless of our reasons for spending our money, most of us have a finite amount that we can spend. Many of us strive to increase the amount of money we earn so we can increase our spending on the things we want rather than the things we need. Purchasing power is important to marketers. The more money we have, the more we can spend.

President Obama has a plan to increase the minimum wage to $9 an hour. Will this increase our purchasing power?

In response to Haley’s post.

Outsourcing and the difference between the cost of the product and the wages of employees is not the only point that can be made. In 1960, the average chief executive earned 40 times as much as the average worker. By 1990, the average CEO earned 107 times as much. In the following decade, this ratio rose to 525:1 before settling back to 301:1 in 2003. Chief executives play an important role in the success of their business, but without the employees in the trenches there would be no company.

Should this pay gap be smaller?

Purchasing with emotion.

Like many Americans I spent Sunday watching the super bowl, not because I like football, because I am always curious to see the commercials. I usually hate commercials, but occasionally there is one that peeks my interest. Mixed in with all the junk Sunday, there was one commercial that it getting a lot of attention, excerpts from a decades-old speech from a radio broadcaster, Paul Harvey. He first delivered the speech at an FFA convention in 1978. The speech also ran in Paul Harvey's syndicated newspaper column in 1986. In the introduction, Harvey disclaimed authorship.

How is it that words as intense as these have escaped the public’s attention?  The commercial brings to light what most of us know but few want to admit. That the farmer is a unique individual and the life they live can by no means called easy and for many even profitable. So rather than pat Dodge on the back for making this commercial, why not pat a farmer on the back and tell them you appreciate what they do. The two minute piece has amazing words and beautiful photographs but they are not enough for me to buy a Dodge.

Personal products, such as clothing and perfume, are associated with higher levels of emotion than nonpersonal products. Rational purchases have little emotion in the decision making process.   How do emotions factor in your buying decision?

 

In response to Pam's post

Pam

Your analogy of the class exercise is a good one. It is very difficult for a single product to satisfy everyone. As you mentioned some of the requests would be impossible to incorporate into a paper airplane.  Look at this link http://www.popsci.com/gear-gadgets/article/2006-08/most-incredible-knife.  A Swiss Army knife that weighs almost 3 pounds and has 85 tools seems a bit extreme. Rather than go to such extremes, many companies will offer different versions of their product enabling the widest customer base as possible. This doesn’t always work either. Do you remember Pepsi Clear?

Can the marketing concept reach a point of diminishing returns? That is, is there a point at which marketers can offer too much choice to too many consumers (try to satisfy too many needs/wants), or is the proliferation of product choices indicative of successful implementation of the marketing concept?

A perfect example of trying to satisfy everyone is what happened to General Motors. They used all the features of Ansoff’s opportunity matrix; market penetration, market development, product development and diversification to ensure the largest customer base possible by having many strategic business units in the automobile market. At one time names like Oldsmobile, Pontiac and Saturn may have been considered in your decision making process when purchasing a new car. The consumers, being bombarded with the vast choices available in the new car market finally said enough and with low sales volume GM stopped producing these brands. Proliferation and diversification are key elements for a company to grow and be successful. Choices are great but there is a point when enough is too much.

 

Are the differences between a GMC and a Chevy truck enough to keep both brands?