Wednesday, March 25, 2009

Dr. Rapaille and Song Airlines in The Persuaders

Dr. Rapaille has used his three-step process to address the marketing world for many years. The idea that humans experience products in steps can be applied to different industries and used to develop new packaging, motto's, and appearances.

Rapaille states that human’s experience:
1. Past Reason
2. Through Emotion
3. To the Primal Core

He is trying to link product purchases to the emotional underlying of a persons life. Stage 1 is used to get the consumer on topic mentally. He uses simple questions regarding their purchases and certain products to focus a person’s view. After a short break for his subject, Rapaille begins stage 2. In order to gain an understanding of the human subconscious, Dr. Rapaille uses stage 2 to confuse his subjects and take their minds off the topic at hand. He often asks them audience to tell him a story about the topic at hand as if he has no previous knowledge. Finally, stage 3 takes the consumer back to the first time they purchased a product and implores them to remember the environment they experienced. He uses these three steps to get in touch with human emotion behind purchases and to figure out the “code” that characterizes each industry. For example, he states that the code in the SUV industry is domination and that the mind set of Americans towards cheese is one of death. Cheese is not depicted as a live dairy product, but rather a dead artifact that rests safely in a bag inside the refrigerator.

Song Airlines constantly tries to create a unique atmosphere around its product and in turn instill brand loyalty. Through outlandish advertising, the company takes a different approach to filling airline seats, and generates a hip, trendy experience. When looking at characteristics such as cheap flights, we can see that Song Airlines is comparable to the modern day Ryanair Airlines.

However, I disagree with the approach the company has taken and the dollars spent in order to inspire the so-called “song” attitude. The company has gone to such measures to make this experience that commercial advertising has left out important features used to inform the alleged consumer of their product. Disregarding the idea that an inner mall shop for an airline is slightly absurd, a perfect example of the company’s uninformed consumer is the man who repeatedly questions whether Song is just a glorified travel agent.

Song Airlines have done some parts of their business model correctly, in my opinion. At the time of its inception, the American economy was still on the rise, giving way to vacations for families and young adult spontaneous holidays. The idea of chic, trendy flights for vacationers that are looking for luxury before they reach their destinations was on par with consumer views in that year. In addition, the brand loyalty they built seemed to have worked, at least on a small scale, due to the testimony of certain patrons during the video. Almost synonymous with the Macintosh attitude many have adopted, Song Airlines was able to get consumers to view them in a positive light and believe their product to be superior.

On the other hand, I believe Song Airlines have placed some of their ideals in the wrong industry. It is great that they are able to create pull amongst their consumers, but I don’t believe the airline industry to be one in which this is a great tactic. Vacationing families may be inclined to frequent Song’s services, but these families are not vacationing enough for the company to successfully count on routine holidays. One year a family may decide a ski trip is in order while the next year they may stay home to save money. Short run book keeping will put Song Airlines in a red light under a the failing brand that is Delta.

Monday, March 9, 2009

Consumer Perceptions and Uncertainty

Kenna’s desire depicts many different struggles that a variety of services and products have experienced. Some are directly related to others, but others can only be linked through their underlying tones concerning intricate lessons the modern marketer must learn. Based on various examples, I view complex consumer perceptions and hidden uncertainties within changing markets to be extremely important principles.

Complex Consumer Perception and Product Quality

Product quality is a delicate subject in marketing and often it is consumer perception that may drive sales or render a product inferior to its competitors. Malcolm Gladwell cites several different examples that are laced with this underlying motive, and he repeatedly points out that product quality and consumer perception are subjects that must be thought of in three dimensions rather than a black and white snapshot.

I feel the strongest example Gladwell uses to convey his ideals concerning consumer perception can be found within the Christian Brothers brandy analysis. The company repeatedly used the idea of a superior liquid product to drive sales, and forgot that many different characteristics such as packaging contribute to sales. A similar situation that I have learned of occurred at Procter and Gamble in their Bounty paper towel sector. Studies revealed that customers look for centered, bright logos when considering which paper towel brands to purchase. By adjusting the positioning of Bounty to front and center and tweaking bright greens and yellows, the company has reacquired market share from their greatest competitors.

The average consumers, barring those that have experience in the marketing workforce, are unaware of their subconscious decisions that happen instantaneously and by the thousands per day. Just entering a supermarket, we can see that consumers generally turn right immediately out of habit and preference (Sue Riha, Retail Merchandising class). Marketers that are trying to gain insight to the consumer mind would do well to take into consideration every step of the purchasing system when it comes to their industry. Questions such as do they physically grab the product, how long is the package examined, and what setting is the product used in are all part of the three dimensional analysis that Gladwell stresses in his article. Overall, we see that consumers hardly ever make rational decisions and patron brands based on the actual contents of the product.

Uncertainty in Consumer Driven Markets

Marketing in essence is a science fortified with a substantial amount of doubt and uncertainty. Around every corner and with every decision there will always be inherent risks that companies and strategists will have to undertake. Estimations and research can be done, but in the end, it is a consumer driven market we live in and it is solely to them that we must adhere.

Gladwell’s first example concerning Kenna’s hardships and his depictions of Coca Cola’s struggle with New Coke are perfect examples of instructive lessons learned from the uncertainty of markets. In both situations, a certain product has tested very well, but failed to live up to predicted sales for unique reasons. Companies can assure themselves of profitable opportunities on multiple fronts and base them on supportive studies, but the consumer decides the fate of a product’s sales. In my personal experience, I note the competition between FireWire and USB 2.0 as a source of market uncertainty and failed product results. Based on simple speed tests and direct comparisons companies and consumers could see the superior quality in FireWire, but USB 2.0 has since ousted the product. As a product, FireWire failed to realize that consumers value versatility over raw specifications, and has since taken a backseat to the widely distributed USB 2.0 format.

Consequently, markets in a capitalist economy are rapidly changing. A lesson for marketers to learn is that you must continually analyze what consumer’s needs and wants are, and cater to them or failure is inevitable. Industry success is never a sure thing, and nothing should be taken for granted in the marketing world.

Monday, February 23, 2009

Wall Street Bailout

The paper topic I am most interested in concerns the recent bailouts with a specialization on Wall Street. My only concern with this topic as of now is the chance that someone else has already chosen it. Currently I am planning on describing the initial plans and intent of the Wall Street specified bill, how it was implemented, where money has been actually been dealt out, and reactions from speculators. There is more than enough information concerning these bailouts to fill out thousands of pages(as they no doubt did), but a condensed 10 to 15 page examination would be appealing.

This plan was particularly interesting to me because I have read lately that not many people believe it is working as fast or as well as it should be. I do not yet understand how we are passing three or four multibillion dollar bailout plans within a span of six months and still coming out with no short term success. It seems like a waste of time for the government to intervene with the market only to instill long term commitments while bankrupting citizens and increasing unemployment in the short run. Meanwhile we are sinking deeper into a recession that has been happening for months now, but only recently declared. How long will we let this go on or hike up inflation before we realize the answer does not lie within printing more money? Tax cuts and inflationary practices have been tried in the past and have failed miserably so this leads me to believe that somewhere within this new bill there is a provision that will avert repeating history. Despite the fact that I believe we, as Americans, have been living beyond our means for a number of years, I am curious to see what Wall Street has done with such a rushed Carte Blanc.

Wall Street activities mainly deal with customer experiences in the borrowing environment. Consumers are currently being held back from expansion because loans are hard to come by. New businesses are not able to open there doors where old ones have faded. This is the first stepping stone that serves in widening the gap between rags and riches. Eventually this will hit customer experiences across the board as far as most industries go because a deep recession has many negative implications. In addition to the negative impacts the depression of the early 1930’s we also have to deal with what Wall Street has begun in the earliest 21st century. Multiple bailout plans have been made necessary because the mainstays of the American market (Wall Street, Real Estate, and Automotive) are failing simultaneously.

Also I have read recent articles pertaining to angry citizens that have lived within their means on Wall Street for the last twenty years. Backlash has been developing amongst those who spent responsibly and now have nothing to show for it. Why should they have been subject to keeping great credit when they could have lived outside their paycheck and accepted a bailout towards the end? While we are printing up billions of dollars for those who have squandered for years why can we not help out those who were raised to be responsible? This entire term paper may be my biggest push for social Darwinism yet. There are no red states and blue states anymore, just many people misinformed over things that have no relevance to society today. We spend millions to help out those in need, but we never just let the market decide who should have wealth. Hopefully by the end of the semester I will be able to draw up plans for a structured bankruptcy and a resurgence of market based decisions that are not solely dependent upon which lobbyist spends the most time in Washington.

There are also political implications I would like to explore when it comes to the topic of passing this bailout in both houses of congress. People rejoiced when it was announced that the first bailout proposed had been eliminated and struck down in the eye of a weary America, but less than a week later a refurbished bill was easily passed as altercations were made to appease more republican congressman. A few hours of quick discussion over the few changes they have used to punch up this new bill decides a good portion of our countries future.

I just noticed the comment sections that are on each of my posts. I am sorry the previous posts were not long enough for your tastes, but I was just following the syllabus outline of one page.*** Ahh checked the syllabus and I misunderstood that these should be one page single spaced. I will make the necessary adjustments on previous topics not that it will inherently change my grade, but just so its clear I am not half assing anything just misunderstanding the comment system here. I have blankly been checking the comments on my grades under blackboard for feedback.

Christ, I can't seem to get this blogging stuff down correctly. As we talked about in class here are the websites that I used for information on this blog.

http://www.boston.com/business/personalfinance/articles/2009/02/22/bailout_lament_what_about_me/ - Consumer backlash against bailout

http://online.wsj.com/article/SB122650321703420903.html - Consumer distrust in the bailout

Monday, February 16, 2009

Children in the Supermarket

Supermarkets have evolved over the years to incorporate not only a wide selection, but also an experience that draws customers back to certain stores. The most interesting strategies stores take concerning experience are geared towards the younger generations. Baby boomers grew up when products were on the rise in the food industry. Newly created microwave meals and frozen dinners fascinated consumers. Generation Y and very young children have been brought up with these foods surrounding them and have come to expect certain things at the supermarket.
Retailers throughout the world have recognized the profitability that comes with correct product placement and needy children. Walking down the aisle of a local food mart, you will see that products such as candies, cookies, and other treats are placed at eye level for youngsters. Kids are set off into “must have” mode whenever certain items grab their attention and turn their heads. Little children will stop at nothing to force their parents or guardians into buying something they don’t especially need. Placing products at eye level also creates the ability for children to reach the items. This lets the child think that they posses the item because they themselves can physically grab it. Once the child has the product the notion that consumers are less willing to give up an item than acquire one begins. Parents often give in to crying children rather than take cheap candy with high margins out of their hands.
Another part of the child experience in supermarkets deals with colors. Children are attracted to bright colors that are strategically placed throughout aisles. Impulse buying colors such as red and yellow contribute to disruptive behavior. Disruptive behavior leads to frequent small purchases or swift slaps to the behind depending on how strong the adult is. Eventually even the strongest parents will break down however.
Once initial shopping trips with children are over the experience is built and youth will want to revisit certain shopping markets countless times. Small tokens such as a free cookie or WholeFood’s free balloon instill a desire in kids to frequent supermarkets. More visits from parents and kids will result in more sales not only in small impulse categories but also in other sections of the store. Therefore, we can see that targeting youngsters in retail markets results in multiple benefits whether it be through high margin gifts within short reach or frequent visits to the supermarket to appease a child and create a family ritual.

Wednesday, February 4, 2009

Consumer Decision's Now Longer

Barry Schwartz makes excellent points as he portrays the amount of variety we have in today’s world of information as a hindrance in many ways. People take much more time to arrive at even the smallest decisions. The vast amount of choices we have has led our decision-making ideology to always seek out something better. The expression “the grass is green on the other side” can now be applied to any situation. Shoppers at the supermarket can be seen pacing isles numerous times looking for the best deal. Consumers are now unwilling to settle on one selling point for a product such as a basic price point, quality aspect, or guarantee. Once a consumer finally makes a decision, they can be seen later wondering how the product’s competitor would have satisfied them more.

Professor Schwartz depressed me if anything as I came to the realization that his descriptions depict my life. Generation Y has been raised in a time where information is abundant and choices are always possible. Perhaps one of the biggest decisions of a college student’s life is what career he/she wants to pursue. Even here, we have always been told that with hard work a person can be whatever he/she wants to be. After graduating high school there are literally thousands of universities and colleges to choose from. Each university offers hundreds of degree plans to cater to each type of person. Even after these first two steps are overcome, we as students must decide how to use the next few years wisely in order to establish a bright future.

Personally, I was indecisive regarding my future until a family member finally showed me through example which path I could take successfully. The Mccomb’s Business School boasts about one of the best programs in the nation that develops some of the most successful students in the nation. However, after having experienced it first hand I believe that my time here has just served as filler for the decision of my future. If society did not constantly evolve and create new jobs, we would not have so many choices to consider for professions and my job search would be much simpler.

The paradox of choice that Mr. Schwartz continually illustrates through cartoon has been present with generation Y since its beginnings. However, we can see that in older generations, such as the baby boomers, choices are now plaguing their lives as well. Adults are learning to research certain products and services beforehand rather than taking the advice of a close friend immediately. Therefore the paradox of choice is able to overcome the previous decision habits of older generations.

Tuesday, January 27, 2009

Generation Y?

I believe that the current companies have captured the idea of generation Y in the short run but they are missing the bigger marketing strategy picture that we have been raised on. Ideas continue to change on a daily basis in the world of generation Y. Fads and trends come and go much more quickly than in the time of the baby boomers. Companies such as Tommy Hilfiger and the recording industry are successfully turning younger adolescents on to new products via word of mouth and viral methods. However, these methods may prove to be outdated in the next 5 years as companies such as Google and Apple begin offering new programs and amassing obscene amounts of data on the average consumer.

Amazon has emerged as a large retailer through its modern techniques of suggesting new products to returning customers. Industries have been perfected over the years as companies continually use data to predict how consumers will react to product changes and introductions. Maybe Amazons approach in suggesting items is the next step for the modern marketing professional. Companies need to stop guessing how generation Y will react to mass advertising in popular events and begin capitalizing on the synergy between product relations that we seem to be experiencing. Generation Y is one that moves from trend to trend quickly and relies on small similarities between each to move on. Apple has capitalized on smaller, sleeker laptops and slowly transitioned its popularity onto other small electronics such as the Ipod and Iphone.

Despite the fact that I have primarily focused on a new approach to marketing, I believe that the path companies need to make is one that keeps the idea of constant change in their minds. Marketers need to focus more on image than products at this point in time. The days of the baby boomers saw a need for physical products to be present in order to convey quality. With online shopping on the rise this is no longer the case. Generation Y will be shopping online for news about the latest trends and best deals.

I do not represent generation Y very much because of my belief that consumption is not necessary in most cases. As an avid follower of George Carlin’s beliefs I find that the more useless items I have shoved into my closet never to be used, the more cluttered my life is.

I believe companies have saturated websites such as Facebook and MySpace to the point of turning away users, but at the same time they are consistently getting their message across. This marketing strategy parallels my idea of constant change because they can instill different images each day based on the users that subscribe to them. The amount of clicks generation Y makes can be traced and used to draw conclusions about which users are the most dedicated and which are first time users. MySpace advertisements can use previous internet activity or posted personal information to target the exact crowd they are looking for and keep up with the changes their consumers undertake.

Monday, January 26, 2009