http://money.msn.com/credit-cards/Twitter-credit-card-problem-solver-credit-cards.aspx
When was the last time you had to call a Customer Service line for support? Was it a positive experience? Or did you earn a merit badge in patience as you sat on hold listening to Kenny G?
Harnessing the power of the social media trend, banks and credit card companies like Citi and Bank of America are looking to use Twitter to address your issues. This allows them to meet the goals of enhancing brand perception while simultaneously reducing Customer Service center call volumes. Whether you Tweet the company directly or they hone in on buzz words in your post, their goal is to turn you from a potential Detractor into a Promoter by fixing problems without ever picking up the phone. The thought is that reaching out in a personalized, efficient, interactive manner by Tweeting and direct messaging will build flocks of loyal consumers who can't wait to advertise their satisfaction on Facebook, blogs, and of course Twitter. The trick is to identify these customers as quickly as possible before negative publicity takes hold.
Companies who wish to survive and expand their value propositions must identify ways to provide better service, info, and products. And these enhancements need to be implemented as fast as possible. Twitter and Facebook are a good start to reaching people quickly and conveniently. How can other functions such as R&D and Market Research leverage this real time data to aid in the continuous improvement cycle?
While social media is being embraced, companies must stay vigilant for the next trend. What sorts of things is your company keeping a close eye on? Once identified, is your company adept at the next steps, including using the emerging trends in innovative strategies? What sorts of digital offerings (like electronic boarding passes at the airport) could add even more value to your products and services?
Saturday, January 29, 2011
Home Depot’s Make-Over
With a decline in big ticket sales, Home Depot has opened its doors to Martha Stewart. This move is an attempt to boost sales by targeting women shoppers. With home sales and major renovation down, the do-it-yourselfer organization will focus on redecorating and growing market share by catering to the changing demographics of its shoppers. This spring the home improvement giant will attempt to shake the male domain reputation by promoting a brand more attractive to women. Martha Stewart Living products will be the first step in enhancing the standings and financials of the company. Home Depot is looking to use growing trends to produce new value propositions in their core markets. As the housing market has not pulled itself out of the recessionary period, Home Depot hopes to address the desires of the redecorating trend and retain the traditional attributes of its long established stores.
Will this change shun their established traditional target audience?
For the last decade, Home Depot has lost market share to Lowe’s, a company which had a female focus since inception. Will this change of focus for Home Depot revitalize its sales? Have they responded too late to the competition and to the recessionary period?
How has your company infused and augmented strategies to retain or grow market share in the recessionary market?
Do you feel your company has been late to respond to growing trends? If so, what has been the impact to your business?
Will this change shun their established traditional target audience?
For the last decade, Home Depot has lost market share to Lowe’s, a company which had a female focus since inception. Will this change of focus for Home Depot revitalize its sales? Have they responded too late to the competition and to the recessionary period?
How has your company infused and augmented strategies to retain or grow market share in the recessionary market?
Do you feel your company has been late to respond to growing trends? If so, what has been the impact to your business?
What does it really mean to be one of the 100 Best?
Every year, Fortune magazine publishes the results of a survey that seeks to name the 100 Best Companies to Work For. Stryker Corporation, a Kalamazoo-based medical products and technologies company, was named 68 out of 100 on the 2011 list. Al Jones from the Kalamazoo Gazette recently penned the article “Stryker named to Fortune magazine's 100 Best Companies to Work For” based on the results. In the effort to have full disclosure, I have worked at Stryker since graduating from college in 2000.
Fortune magazine uses a series of research methods to compile data for determining the list including employee surveys, internal census data, employee compensation, perks (ex. benefits, telecommuting), past layoffs and company financial performance. The employee surveys account for 2/3 of the overall score and are conducted via telephone from a list of randomly selected employees from the census by the Great Place to Work Institute.
To be considered for the ranking, each company must submit an application to Fortune that provides evidence of exceptional work environments. For the 2011 ranking, 311 companies participated and met the requirement to have at least 60% response to the employee survey. Though there a no hard facts, it is rumored that companies appearing on the top 100 list may experience anywhere from 2X to 6X increase in job applicants as well as increased good will. Further, many of the top companies employ multiple people full time to submit their applications and maintain their good ranking.
I am very proud and happy to work for a company that I consider one of the world’s best (full listing see http://money.cnn.com/magazines/fortune/bestcompanies/2011/index.html) This is a great reward for our company and Fortune appears to have an excellent methodology but I have a few reservations about the data. I have to wonder about the companies that did not spend the time and money to submit to Fortune’s research. There are obviously more than 311 great companies in the United States and I am sure there are some others that belong on this list. To me the sample size is not large enough to be truly representative. Also, the top of the list seems skewed towards high pay and/or the financial and dot com groups. I am not sure that manufacturing can compete.
Questions
1 – Do the results of surveys like this influence your personal decision making (i.e. Will you consider these companies as a possible future employer)?
2 – Do you trust that surveys conducted that rank companies, products or even opinions are not biased? If not, how do you distinguish between biases?
3 – Given that these results are only based on the 311 companies that applied, should we accept that these companies are a representative sample?
Fortune magazine uses a series of research methods to compile data for determining the list including employee surveys, internal census data, employee compensation, perks (ex. benefits, telecommuting), past layoffs and company financial performance. The employee surveys account for 2/3 of the overall score and are conducted via telephone from a list of randomly selected employees from the census by the Great Place to Work Institute.
To be considered for the ranking, each company must submit an application to Fortune that provides evidence of exceptional work environments. For the 2011 ranking, 311 companies participated and met the requirement to have at least 60% response to the employee survey. Though there a no hard facts, it is rumored that companies appearing on the top 100 list may experience anywhere from 2X to 6X increase in job applicants as well as increased good will. Further, many of the top companies employ multiple people full time to submit their applications and maintain their good ranking.
I am very proud and happy to work for a company that I consider one of the world’s best (full listing see http://money.cnn.com/magazines/fortune/bestcompanies/2011/index.html) This is a great reward for our company and Fortune appears to have an excellent methodology but I have a few reservations about the data. I have to wonder about the companies that did not spend the time and money to submit to Fortune’s research. There are obviously more than 311 great companies in the United States and I am sure there are some others that belong on this list. To me the sample size is not large enough to be truly representative. Also, the top of the list seems skewed towards high pay and/or the financial and dot com groups. I am not sure that manufacturing can compete.
Questions
1 – Do the results of surveys like this influence your personal decision making (i.e. Will you consider these companies as a possible future employer)?
2 – Do you trust that surveys conducted that rank companies, products or even opinions are not biased? If not, how do you distinguish between biases?
3 – Given that these results are only based on the 311 companies that applied, should we accept that these companies are a representative sample?
Murky Metrics
This article raises questions regarding whether or not marketers really know more as a result of the new marketing metrics that have been developed in recent years. This doubt has prompted efforts within the marketing industry to determine which metrics are really meaningful.
The MASB which stands for Marketing Accountability Standards Board wants to create a set of metrics generally recognized as meaningful and predictive similar to the FASB (Financial Accounting Standard Board) for accounting metrics and ISO (International Standards Organization) for quality-control metrics.
Thus far the group has validated that surveys of brand preference do in fact correlate with market share and by extension cash flow. Contrast this finding with the numerous studies that shows clicks on banner ads have little to do with purchase behavior when products and services are not sold online. Despite this company’s continue to pay attention to banner clicks because they are easy to measure.
1. At your company what marketing metrics do you feel correspond with the ultimate goal of sales or revenue?
2. Will identifying predictive marketing measures give chief marketing officers the same type of credibility that chief financial officers have?
3. Will it take the marketing industry a couple more decades to get to the level of validation that financial or quality metrics have?
The MASB which stands for Marketing Accountability Standards Board wants to create a set of metrics generally recognized as meaningful and predictive similar to the FASB (Financial Accounting Standard Board) for accounting metrics and ISO (International Standards Organization) for quality-control metrics.
Thus far the group has validated that surveys of brand preference do in fact correlate with market share and by extension cash flow. Contrast this finding with the numerous studies that shows clicks on banner ads have little to do with purchase behavior when products and services are not sold online. Despite this company’s continue to pay attention to banner clicks because they are easy to measure.
1. At your company what marketing metrics do you feel correspond with the ultimate goal of sales or revenue?
2. Will identifying predictive marketing measures give chief marketing officers the same type of credibility that chief financial officers have?
3. Will it take the marketing industry a couple more decades to get to the level of validation that financial or quality metrics have?
CPFR
http://scm.ncsu.edu/public/cpfr/index.html#2
This article is about CPFR (Collaborative Planning Forecasting, and Replenishment). I am part of Whirlpool's Supply Chain organization. Whirlpool has a very deeply embedded CPFR system so our marketing, sales, merchandising, and supply chain organizations work in a collaborative effort with the customer to ensure their all of their needs are met from advertising to point of purchase literature to price negotiations to logistics needs. By each of our departments being on the same page working together to meet the customer's needs, we find cohesiveness in customer communication and we also find we are better to able to present better offerings on the front end of sales rather than reacting to what the customer needs after our initial sales pitch. Because each of our departments has a different perspective about what the customer will be looking for, we can work together to create proposals that match each our customer's differing needs but also are executable and supported by each of our internal departments.
Many times in the past, we found Sales would pitch an idea to the customer without considering if we had the resources to fulfill the customer's need. Sales also would create advertising and promotion literature and design that would not be consistent with our company's total brand message. With the integration of our CPFR process we are able to ensure Sales is armed with everything they need to make decisions the customer will be likely to accept while informing the rest of our internal organization about potential sales volumes and growth we can expect and prepare for.
For the most part our CPFR process works very well. On occasion our supply chain demand and production teams disagree with sales projections and we have to come to some sort of agreement on a total volume for production, but we are usually pretty close. In the past three years our internal dialogue has become much more streamlined and much less confrontational.
My questions would be: Do any of you also have an organization with a CPFR structure and what do you find to be your strength and weaknesses?
This article is about CPFR (Collaborative Planning Forecasting, and Replenishment). I am part of Whirlpool's Supply Chain organization. Whirlpool has a very deeply embedded CPFR system so our marketing, sales, merchandising, and supply chain organizations work in a collaborative effort with the customer to ensure their all of their needs are met from advertising to point of purchase literature to price negotiations to logistics needs. By each of our departments being on the same page working together to meet the customer's needs, we find cohesiveness in customer communication and we also find we are better to able to present better offerings on the front end of sales rather than reacting to what the customer needs after our initial sales pitch. Because each of our departments has a different perspective about what the customer will be looking for, we can work together to create proposals that match each our customer's differing needs but also are executable and supported by each of our internal departments.
Many times in the past, we found Sales would pitch an idea to the customer without considering if we had the resources to fulfill the customer's need. Sales also would create advertising and promotion literature and design that would not be consistent with our company's total brand message. With the integration of our CPFR process we are able to ensure Sales is armed with everything they need to make decisions the customer will be likely to accept while informing the rest of our internal organization about potential sales volumes and growth we can expect and prepare for.
For the most part our CPFR process works very well. On occasion our supply chain demand and production teams disagree with sales projections and we have to come to some sort of agreement on a total volume for production, but we are usually pretty close. In the past three years our internal dialogue has become much more streamlined and much less confrontational.
My questions would be: Do any of you also have an organization with a CPFR structure and what do you find to be your strength and weaknesses?
Friday, January 28, 2011
Making your customers, and the general public, work for you!
I know I know, there was already a SuperBowl article posted (sorry Stephanie), but I thought this article had an interesting marketing twist related to the big day.
In a nutshell, 4 of the 6 slots that PepsiCo has purchased for the game will be commercials that are homemade, and not created internally by Pepsi's marketing team. In addition, beyond the actual homemade ad creation, Pepsi is utilizing the internet to allow anyone to vote on the finalists to choose the final 4 which are shown, which furthers the engagement. What a great way to suck in your customers! Not only are they putting ads up in front of millions of people, but they are doing it in a unique way. Rudy Wilson in the article makes a great point. The commercials during the SuperBowl are "a lot more than 30 seconds". The internet allows these ads live on for quite a while after the game. With this contest, PepsiCo has taken it a step further by initiating the buzz 6 months prior to the game.
Throughout the article they go on to discuss the contest and their process for getting it down to their top 10. They also explain the impact of advertising during the SuperBowl and the success that they have had in years past.
I believe this is ingenious. I would bet that they not only had loyal customers submitting ideas, but also people who heard about the contest that had not already been loyal to the brand. For those people, this definitely makes the brand "sticky". It is unique and differentiating and allows the company to continually market a 30 second spot much more than the isolated event through a variety of mediums.
Be sure to follow the link at the top of the article to see the finalist videos which may be shown during the game. Some of them are quite funny.
My questions to you are:
- What do you think of their idea? Do you, like myself, believe that it is a differentiator amid the hype of the SuperBowl ads, or will they still blend in with all of the others?
- Do any of your companies do anything unique like this to engage your customers in ways other than them simply buying your products?
- Do you believe that initiatives such as this have an impact to enhance customer lifetime value and build equity in the brand?
Thursday, January 27, 2011
Amazon wants to tote your groceries
Article Summary
Amazon has recently rolled out AmazonTote, a free weekly delivery service intended to encourage customers to expand their online shopping to include everyday household goods. As the name implies, the items ordered will appear at a customer’s doorstep in a sturdy weather-resistant tote bag. Customers can either keep the tote bag or return it to their doorstep for reuse on their next weekly delivery day (called a "ToteDay").
AmazonTote is available only in Seattle for now. While it may appear at first to be a direct competitor to grocery delivery services, its purpose may simply be to get items to customers faster, cheaper, and more reliably. The article mentions that "[B]esides expanding the kind of items customers purchase and upping the frequency of their buys, AmazonTote could ultimately give Amazon a better handle on shipping costs, a major expense. In the Seattle area, Amazon uses its own trucks to fulfill AmazonTote deliveries, bypassing the postal service, UPS and FedEx. It also doesn’t pack items in boxes, reducing another cost."
Questions
1. How do you see the six major macroeconomic forces (demographic, economic, socio-cultural, natural, technological, and politico-legal) affecting the future of AmazonTote?
2. If you were part of the Amazon team evaluating the expansion of AmazonTote into markets outside Seattle, how would you conduct marketing research? What would your target groups be? What method (survey, focus group, etc.) would you use?
3. Given your answers to questions 1 and 2, do you believe the Lansing area would be a good candidate for AmazonTote?
Amazon has recently rolled out AmazonTote, a free weekly delivery service intended to encourage customers to expand their online shopping to include everyday household goods. As the name implies, the items ordered will appear at a customer’s doorstep in a sturdy weather-resistant tote bag. Customers can either keep the tote bag or return it to their doorstep for reuse on their next weekly delivery day (called a "ToteDay").
AmazonTote is available only in Seattle for now. While it may appear at first to be a direct competitor to grocery delivery services, its purpose may simply be to get items to customers faster, cheaper, and more reliably. The article mentions that "[B]esides expanding the kind of items customers purchase and upping the frequency of their buys, AmazonTote could ultimately give Amazon a better handle on shipping costs, a major expense. In the Seattle area, Amazon uses its own trucks to fulfill AmazonTote deliveries, bypassing the postal service, UPS and FedEx. It also doesn’t pack items in boxes, reducing another cost."
Questions
1. How do you see the six major macroeconomic forces (demographic, economic, socio-cultural, natural, technological, and politico-legal) affecting the future of AmazonTote?
2. If you were part of the Amazon team evaluating the expansion of AmazonTote into markets outside Seattle, how would you conduct marketing research? What would your target groups be? What method (survey, focus group, etc.) would you use?
3. Given your answers to questions 1 and 2, do you believe the Lansing area would be a good candidate for AmazonTote?
Verizon Wireless is planning to steal market share from AT&T
AT&T has locked in over 4.1 million customers from selling the iPhone last quarter. However, this exclusive contract between Apple Inc. and AT&T will soon expire. Verizon Wireless now has a chance to compete in the iPhone marketplace. Verizon recently hinted that it is expecting to sell at least 11 million iPhones in 2011. Verizon will also offer unlimited data plans for a limited time in order to entice current AT&T subscribers to switch over. A Yankee Group study suspects that at least 2.5 million iPhone customers will switch from AT&T service to Verizon. The pre-ordering process for a Verizon iPhone will begin February 3rd.
AT&T has tried many aggressive tactics to maintain their market share including new deals with Blackberry and Windows Phone 7, expensive switching costs for current customers, and early upgrade deals to the iPhone 4.
Questions:
Why are consumers attracted to Verizon Wireless over AT&T?
Can AT&T stay alive by signing new exclusive contracts with phone manufacturers? What else can AT&T do to secure their market share?
Do you think Verizon wireless will sell at least 11 million iPhones in 2011? Why?
Wednesday, January 26, 2011
Analyzing the side effects of drug ads
By Julie Appleby, USA TODAY
A few times every week, patients ask Jim King about drugs they've seen advertised.
"They'll say, 'I saw this ad on TV, and I think I have this medical problem,' " says King, a family physician in Selmer, Tenn., who says he's not bothered by the requests. "It gives me an opportunity to talk with the patient. It's amazing how many don't have the problem" or need the drug they saw advertised.
Billy Tauzin, president of Pharmaceutical Research and Manufacturers of America, the industry's lobbying group, says the ads educate patients about diseases such as depression or diabetes and encourage them to see a doctor.
Doctors and health care analysts say those visits also prompt patients to seek the latest and often most expensive drug, helping to drive up spending on health care and raising questions about whether patients need those particular new medications.
DOCTOR'S RESPONSES: Drug ads push prescription requests higher
Food and Drug Administration has allowed drug advertising since 1997. After safety concerns led drugmaker Merck to pull its heavily advertised painkiller Vioxx off the market in October 2004, Congress and consumer groups such as Public Citizen escalated their criticism of drug ads.
The industry responded with guidelines it said would improve consumer information. Ads are "less offensive than they were a few years ago, more educational, and they balance a discussion of benefits and risk," Tauzin says.
Prescription-drug advertising is big business. The pharmaceutical industry in 2006 spent $4.8 billion on consumer ads, according to IMS Health, a private firm that tracks sales and marketing. The industry spent $7.2 billion more marketing products to doctors.
Consumer advertising has "contributed to overall increases in spending on both the advertised drug itself and on other drugs that treat the same conditions," says a Government Accountability Office report from 2006. It cites another study of 64 drugs that found for every $1 spent on advertising, sales increased by a median of $2.20.
Endocrinologist John Buse sometimes urges his patients to wait until a drug has been on the market for a while to see whether side effects undetected in earlier studies emerge. "There are a lot of unmet needs in medicine," says Buse, who is president of medicine and science at the American Diabetes Association. "Does that mean these new drugs meet those needs? Not always. Sometimes it's just new, and you're trading" side effects.
New drugs vs. generics
Visits prompted by advertising can propel patients to take more expensive, newer drugs, when lower-cost generics would work just as well, says Jerry Avorn, a professor at Harvard Medical School and author of Powerful Medicines.
If education were the true goal of advertisements, he says, public service spots would fill that need without encouraging people "to spend so many dollars on the most expensive drugs."
Even so, slightly more than half, 53%, of those surveyed by USA TODAY, the Kaiser Family Foundation and the Harvard School of Public Health say drug advertising is mostly a good thing, and two-thirds say it helps educate people. Two-thirds say there are too many ads, but only 27% say they are bothered a lot by advertising. The survey of 1,695 adults was taken in January and has a margin of error of +/—3 percentage points.
"Advertising has been a good thing," says Belle Woods, 55, of Bluffs, Ill. "If I hear of a medication I think could help someone, I share that information. Also, I hear all the possible side effects (of a drug) and think, 'Hmm, maybe I'm not going to try it.' "
Gloria Henderson, 59, of Madisonville, Tenn., says some of the money spent on ads would be better used by drug companies to lower prices, perhaps setting prices based on people's incomes. She wants to see TV drug ads banned.
Matt Carr, 64, of Manassas, Va., says drugmakers have a right to market their products. He once asked his doctor about an asthma drug he saw advertised. "He gave me a reason why the one I was already taking was preferable."
Market's high pressure
Advertising is just one factor in rising drug prices.
Overall prices grew about 3.5% in 2006, government data show, spurred not only by ads but also by new drugs on the market and an aging population. In 2006, insurers, consumers and government spent $216 billion on prescription medications, about 10% of the total spent on health care in the USA.
The average price increase masks some sharper jumps in certain types of drugs. Sleep aids — a heavily advertised product — rose 13.8% in price from 2005 to 2006, according to data from Express Scripts, a private firm hired by employers and insurers to handle drug benefits. The data cover people with insurance; the uninsured may have seen steeper increases.
Cholesterol drugs, also heavily advertised, went up an average 5.5% — the average price of a prescription of Lipitor hit $85.68 for a month's supply, according to the Express Scripts data.
King, who is president of the American Academy of Family Physicians, says the three types of drugs he most commonly hears patients request are treatments for impotence, indigestion and restless legs, a condition that causes strange sensations in the legs and an uncontrollable urge to move. All three are heavily advertised.
When patients do need medication, King says, he talks with them about the drugs and their costs. "If I can use a less expensive medicine or a generic, I will," he says.
1. What are your thoughts on the advertising of prescription drugs?
2. Do you feel doctors are overly influenced to prescribe due to patient requests?
3. Pharmaceutical companies have a product to sell-- shouldn't they have the same rights to promote as any other consumer products company?
Thanks for reading this post!
Tony Blaskis
A few times every week, patients ask Jim King about drugs they've seen advertised.
"They'll say, 'I saw this ad on TV, and I think I have this medical problem,' " says King, a family physician in Selmer, Tenn., who says he's not bothered by the requests. "It gives me an opportunity to talk with the patient. It's amazing how many don't have the problem" or need the drug they saw advertised.
Billy Tauzin, president of Pharmaceutical Research and Manufacturers of America, the industry's lobbying group, says the ads educate patients about diseases such as depression or diabetes and encourage them to see a doctor.
Doctors and health care analysts say those visits also prompt patients to seek the latest and often most expensive drug, helping to drive up spending on health care and raising questions about whether patients need those particular new medications.
DOCTOR'S RESPONSES: Drug ads push prescription requests higher
Food and Drug Administration has allowed drug advertising since 1997. After safety concerns led drugmaker Merck to pull its heavily advertised painkiller Vioxx off the market in October 2004, Congress and consumer groups such as Public Citizen escalated their criticism of drug ads.
The industry responded with guidelines it said would improve consumer information. Ads are "less offensive than they were a few years ago, more educational, and they balance a discussion of benefits and risk," Tauzin says.
Prescription-drug advertising is big business. The pharmaceutical industry in 2006 spent $4.8 billion on consumer ads, according to IMS Health, a private firm that tracks sales and marketing. The industry spent $7.2 billion more marketing products to doctors.
Consumer advertising has "contributed to overall increases in spending on both the advertised drug itself and on other drugs that treat the same conditions," says a Government Accountability Office report from 2006. It cites another study of 64 drugs that found for every $1 spent on advertising, sales increased by a median of $2.20.
Endocrinologist John Buse sometimes urges his patients to wait until a drug has been on the market for a while to see whether side effects undetected in earlier studies emerge. "There are a lot of unmet needs in medicine," says Buse, who is president of medicine and science at the American Diabetes Association. "Does that mean these new drugs meet those needs? Not always. Sometimes it's just new, and you're trading" side effects.
New drugs vs. generics
Visits prompted by advertising can propel patients to take more expensive, newer drugs, when lower-cost generics would work just as well, says Jerry Avorn, a professor at Harvard Medical School and author of Powerful Medicines.
If education were the true goal of advertisements, he says, public service spots would fill that need without encouraging people "to spend so many dollars on the most expensive drugs."
Even so, slightly more than half, 53%, of those surveyed by USA TODAY, the Kaiser Family Foundation and the Harvard School of Public Health say drug advertising is mostly a good thing, and two-thirds say it helps educate people. Two-thirds say there are too many ads, but only 27% say they are bothered a lot by advertising. The survey of 1,695 adults was taken in January and has a margin of error of +/—3 percentage points.
"Advertising has been a good thing," says Belle Woods, 55, of Bluffs, Ill. "If I hear of a medication I think could help someone, I share that information. Also, I hear all the possible side effects (of a drug) and think, 'Hmm, maybe I'm not going to try it.' "
Gloria Henderson, 59, of Madisonville, Tenn., says some of the money spent on ads would be better used by drug companies to lower prices, perhaps setting prices based on people's incomes. She wants to see TV drug ads banned.
Matt Carr, 64, of Manassas, Va., says drugmakers have a right to market their products. He once asked his doctor about an asthma drug he saw advertised. "He gave me a reason why the one I was already taking was preferable."
Market's high pressure
Advertising is just one factor in rising drug prices.
Overall prices grew about 3.5% in 2006, government data show, spurred not only by ads but also by new drugs on the market and an aging population. In 2006, insurers, consumers and government spent $216 billion on prescription medications, about 10% of the total spent on health care in the USA.
The average price increase masks some sharper jumps in certain types of drugs. Sleep aids — a heavily advertised product — rose 13.8% in price from 2005 to 2006, according to data from Express Scripts, a private firm hired by employers and insurers to handle drug benefits. The data cover people with insurance; the uninsured may have seen steeper increases.
Cholesterol drugs, also heavily advertised, went up an average 5.5% — the average price of a prescription of Lipitor hit $85.68 for a month's supply, according to the Express Scripts data.
King, who is president of the American Academy of Family Physicians, says the three types of drugs he most commonly hears patients request are treatments for impotence, indigestion and restless legs, a condition that causes strange sensations in the legs and an uncontrollable urge to move. All three are heavily advertised.
When patients do need medication, King says, he talks with them about the drugs and their costs. "If I can use a less expensive medicine or a generic, I will," he says.
1. What are your thoughts on the advertising of prescription drugs?
2. Do you feel doctors are overly influenced to prescribe due to patient requests?
3. Pharmaceutical companies have a product to sell-- shouldn't they have the same rights to promote as any other consumer products company?
Thanks for reading this post!
Tony Blaskis
Tuesday, January 25, 2011
New York Times Readies Pay Wall
The New York Times is preparing to sell subscription services to access material on their website which is currently available for free. Times Co. is hoping to be able to intice viewers of digital content by allowing the first portion of a visit at no cost, but offer several levels of subscriptions that vary from internet-only access to an offering which combines both internet content with a digital package that bundles the Times online with its application on the iPad.
A consumer shift from printed media to the Internet has resulted in significant losses in both the volume of printed material and the respective advertising revenues. The current free site is visited by over 30 million people per month, generating over $100 million per year in advertising. Of the visitors more than 50% enter the site through "side door" means, including search engines and social-networking sites. Times Co. has estimated that only 15% of their users are "heavy users" which view enough information to require a subscription.
The move to initiate charges for full access to the website's content represents a risky move as so much material is available from other free sites. While Times Co. views the additional revenue as an opportunity, the current advertising revenue is significant, and prompts the following questions:
1) Given the vast amount of similar information that is readily available at no cost, will consumers be willing to pay for a service that they are currently experiencing for free?
2) Will the fact that a non-subscriber can access the same content by entering via a search engine further deter potential subscribers from purchasing a subscription?
3) Are there other offerings that Times Co. could combine to make a subscription more inticing?
A consumer shift from printed media to the Internet has resulted in significant losses in both the volume of printed material and the respective advertising revenues. The current free site is visited by over 30 million people per month, generating over $100 million per year in advertising. Of the visitors more than 50% enter the site through "side door" means, including search engines and social-networking sites. Times Co. has estimated that only 15% of their users are "heavy users" which view enough information to require a subscription.
The move to initiate charges for full access to the website's content represents a risky move as so much material is available from other free sites. While Times Co. views the additional revenue as an opportunity, the current advertising revenue is significant, and prompts the following questions:
1) Given the vast amount of similar information that is readily available at no cost, will consumers be willing to pay for a service that they are currently experiencing for free?
2) Will the fact that a non-subscriber can access the same content by entering via a search engine further deter potential subscribers from purchasing a subscription?
3) Are there other offerings that Times Co. could combine to make a subscription more inticing?
Too Much Demand!
This article ties neatly into our readings from last week as it outlines the importance of the marketing function with respect to properly forecasting demand. Failure to anticipate market demand can leave companies without components to assemble product their customers are willing to purchase now. Not having that product ready to go does not only violate the 4 P's of marketing, it gives the competition the opportunity to provide their substitute product.
It appears that Apple correctly forecasted the market demand for its iPads and proactively identified components that could become an issue. Apple then used $3.9 Billion to secure supply of these components from multiple vendors. This approach not only seems to have assisted Apple in ensuring uninterrupted supply, it has also created a barrier to other competing companies. With Apple tying up the majority of the available components, competitors trying to compete with similar tablet computers will not be able to get their hands on the necessary parts to meet their forecasted demand.
The company I currently work for uses only history and OEM (Original Equipment Manufacturers) build rates to forecast annual demand. How does your company forecast sales for existing products? How do they forecast demand for new products?
I look forward to your comments.
Jim Rosema
It appears that Apple correctly forecasted the market demand for its iPads and proactively identified components that could become an issue. Apple then used $3.9 Billion to secure supply of these components from multiple vendors. This approach not only seems to have assisted Apple in ensuring uninterrupted supply, it has also created a barrier to other competing companies. With Apple tying up the majority of the available components, competitors trying to compete with similar tablet computers will not be able to get their hands on the necessary parts to meet their forecasted demand.
The company I currently work for uses only history and OEM (Original Equipment Manufacturers) build rates to forecast annual demand. How does your company forecast sales for existing products? How do they forecast demand for new products?
I look forward to your comments.
Jim Rosema
learning from Google and Facebook`s move in the Asia`s biggest booming country
Target Market, Positioning and Segmentation-
While skimming over the topics that we learned over the last two weeks, this article attracts my attention which covers some of the important learning in the field of Target market as well as Social forces. Two Big techies with two different products have two different approaches for the same market. Where Larry Page (co-founder, Google Inc) made decision to quit China`s search market, Mark Zuckerberg (CEO, Facebook) is tantalizing to penetrate in the 420 million internet users country. The author of this article is maneuvering us through the subject of social forces that Facebook may face in China while supplementing his argument with few strategic moves. So the obvious question that comes into our mind is
1)What Facebook can learn from Google?
2) Are they good at analyzing the business market?
3) What mistakes that Google did when they did their market study?
4) Which strategy you think Facebook should adopt?
A positive discussion on this topic will be helpful to understand this subject.
Monday, January 24, 2011
Innovative and Cost-Effective Ways to Market a New Business
Suresh Sanjala (Cohort 2).....
There are many distinct, inventive, innovative and inexpensive ways that many new business owners use to promote their companies. Compared to the conventional methods of direct mail advertising, telemarketing, and the use of broadcast media, business owners are now relying upon novel approaches to market their goods. Many companies use guerrilla and subliminal marketing as a fast and effective means to gain publicity and to sell their products and services. In addition, the use of podcast, blogs, and social networking sites has also become popular alternatives to traditional means. Whatever the method, business owners are able to successfully establish recognition, credibility, profitability, and a wide consumer base.
Guerrilla marketing
This term is used to describe unique, imaginative, and cost-efficient ways to advertise a product or service. Often times, small business owners will resort to this form of marketing because it is cheaper and sometimes more successful than traditional marketing strategies. The purpose is to “creatively” attract customers to buy a given product or service. An example of guerrilla marketing can be found in most restaurants. Many restaurant pagers will advertise their drink and/or meal special on the devise. People become more aware of the restaurant’s special deals as they are waiting to be seated and because of the ad, they will often buy the foods that are advertised.
Another example of guerrilla marketing is hot air balloon ads. During county fairs, marathons, and other outdoor social gatherings fast food chains, telephone companies, gas and electric companies, and automobile dealerships will advertise their logo on hot air balloons that appear in the sky overhead. The purpose is to simply raise awareness to their business. Many companies have found this type of advertisement effective since everyone is able to view their logo.
Subliminal advertising
Subliminal advertising is a form of marketing where a message is deliberately embedded within an image or sound. Many people may not be consciously aware they are being exposed to such implications, but will often change their actions and attitudes after viewing or listening to the advertisement. A successful subliminal advertisement is one that inconspicuously entices consumers to buy and use various products and services. Examples of subliminal advertisements are in-store air-borne aromas and other product visual manipulations that have been scientifically proven to create consumer impulse spending. Some retail clothing stores may even embed hidden phrases within their overhead music in order to keep the customer within their store for longer periods of time. The longer that a customer stays within a store, the more likely they will find something they like. Most often, these customers end up purchasing the item(s). For example, during the holidays many candle stores will light their entire store and storefront with many holiday-related scents, such as cinnamon, vanilla, gingerbread, etc. Many people who are buying gifts for relatives and friends are easily attracted to the scents and are lured inside. Often times, they may be convinced to purchase candles and other scented items from the store because they are highly influenced by the delightful aroma of Christmas time.
Pod casting
Another innovative way to market a new business is through the use of podcast. Pod casting is a technological term in which digital media (audio and video) can be transmitted from online to one’s own personal computer or portable media device. Podcast serve as a fast and convenient way in which many new businesses can use the online community to reach their targeted audiences. The advantage of utilizing podcast is that prospective customers who are interested in a business proposal can simply click and download the desired podcast. This digital information can be shared instantly with anyone at anytime. In addition, podcast can be distributed through many different channels on the Internet, greatly increasing consumer awareness and sales. It is no wonder that podcast marketing serves as an effective way to generate online traffic and to increase the amount of transactions and consumer base.
For example, many automobile companies use podcast as a branding, marketing, and sales tool. Their podcast may provide information regarding the launch of a new automobile model or other different topics such as tips on roadside traveling and vacation destinations. In addition, many popular resorts also use podcast regularly to entice consumers. The podcast can include any upcoming special events that may take place at the resort, behind-the-scene interviews and tours, as well as news about new exhibits and expeditions. For the most part, podcast need to be highly appealing for the target audience in order for them to view the business and consider buying its products and services.
Blogs/forums
Another novel approach to marketing is the use of forums and blogs. Just as pod casting attracts online audiences, blogs and forums also serve as an excellent and simple way to bring attention to a new business. A recent study conducted reveals that there is an increasing number of blogs than in previous years. Since blogging is the online equivalent to a verbal discussion, an entrepreneur needs to make sure that their blog is interesting to read, informative, and friendly to their online audience. The advantage of blogging in entrepreneur marketing is that it allows the business owner to conduct a dialogue with the potential customer. On most blog and forum sites, customers can post their questions or comments, and the new business owner will reply to all inquiries.
Do you think the new methods of marketing will increase their sales?
Or
Do you think it just creates the awareness of the product?
or
Do you think this sort of marketing will not registered in the consumers mind and they ignore it?
There are many distinct, inventive, innovative and inexpensive ways that many new business owners use to promote their companies. Compared to the conventional methods of direct mail advertising, telemarketing, and the use of broadcast media, business owners are now relying upon novel approaches to market their goods. Many companies use guerrilla and subliminal marketing as a fast and effective means to gain publicity and to sell their products and services. In addition, the use of podcast, blogs, and social networking sites has also become popular alternatives to traditional means. Whatever the method, business owners are able to successfully establish recognition, credibility, profitability, and a wide consumer base.
Guerrilla marketing
This term is used to describe unique, imaginative, and cost-efficient ways to advertise a product or service. Often times, small business owners will resort to this form of marketing because it is cheaper and sometimes more successful than traditional marketing strategies. The purpose is to “creatively” attract customers to buy a given product or service. An example of guerrilla marketing can be found in most restaurants. Many restaurant pagers will advertise their drink and/or meal special on the devise. People become more aware of the restaurant’s special deals as they are waiting to be seated and because of the ad, they will often buy the foods that are advertised.
Another example of guerrilla marketing is hot air balloon ads. During county fairs, marathons, and other outdoor social gatherings fast food chains, telephone companies, gas and electric companies, and automobile dealerships will advertise their logo on hot air balloons that appear in the sky overhead. The purpose is to simply raise awareness to their business. Many companies have found this type of advertisement effective since everyone is able to view their logo.
Subliminal advertising
Subliminal advertising is a form of marketing where a message is deliberately embedded within an image or sound. Many people may not be consciously aware they are being exposed to such implications, but will often change their actions and attitudes after viewing or listening to the advertisement. A successful subliminal advertisement is one that inconspicuously entices consumers to buy and use various products and services. Examples of subliminal advertisements are in-store air-borne aromas and other product visual manipulations that have been scientifically proven to create consumer impulse spending. Some retail clothing stores may even embed hidden phrases within their overhead music in order to keep the customer within their store for longer periods of time. The longer that a customer stays within a store, the more likely they will find something they like. Most often, these customers end up purchasing the item(s). For example, during the holidays many candle stores will light their entire store and storefront with many holiday-related scents, such as cinnamon, vanilla, gingerbread, etc. Many people who are buying gifts for relatives and friends are easily attracted to the scents and are lured inside. Often times, they may be convinced to purchase candles and other scented items from the store because they are highly influenced by the delightful aroma of Christmas time.
Pod casting
Another innovative way to market a new business is through the use of podcast. Pod casting is a technological term in which digital media (audio and video) can be transmitted from online to one’s own personal computer or portable media device. Podcast serve as a fast and convenient way in which many new businesses can use the online community to reach their targeted audiences. The advantage of utilizing podcast is that prospective customers who are interested in a business proposal can simply click and download the desired podcast. This digital information can be shared instantly with anyone at anytime. In addition, podcast can be distributed through many different channels on the Internet, greatly increasing consumer awareness and sales. It is no wonder that podcast marketing serves as an effective way to generate online traffic and to increase the amount of transactions and consumer base.
For example, many automobile companies use podcast as a branding, marketing, and sales tool. Their podcast may provide information regarding the launch of a new automobile model or other different topics such as tips on roadside traveling and vacation destinations. In addition, many popular resorts also use podcast regularly to entice consumers. The podcast can include any upcoming special events that may take place at the resort, behind-the-scene interviews and tours, as well as news about new exhibits and expeditions. For the most part, podcast need to be highly appealing for the target audience in order for them to view the business and consider buying its products and services.
Blogs/forums
Another novel approach to marketing is the use of forums and blogs. Just as pod casting attracts online audiences, blogs and forums also serve as an excellent and simple way to bring attention to a new business. A recent study conducted reveals that there is an increasing number of blogs than in previous years. Since blogging is the online equivalent to a verbal discussion, an entrepreneur needs to make sure that their blog is interesting to read, informative, and friendly to their online audience. The advantage of blogging in entrepreneur marketing is that it allows the business owner to conduct a dialogue with the potential customer. On most blog and forum sites, customers can post their questions or comments, and the new business owner will reply to all inquiries.
Do you think the new methods of marketing will increase their sales?
Or
Do you think it just creates the awareness of the product?
or
Do you think this sort of marketing will not registered in the consumers mind and they ignore it?
Can Toyota salvage their brand recognition as a leader in safety?
Toyota is the world's largest auto marker. They are consistently awarded and recognized for their performance in safety tests including the infamous 5-star safety rating and IIHS top safety picks. However throughout most of last year, their reputation has been tarnished by several large recall due to safety issues effected some of their top selling vehicles.
In this article, the author discusses how Toyota is working to salvage their reputation as the leader in passenger safety. The effects of last years recalls are still fresh on each new car buyers mind, but the fact still remains that Toyota is still the number one car company in the world (this is backed up by an article in both the Free Press and Detroit News today). The article sites GFK Research from Southfield, Michigan that points out the Toyota can not charge forward without addressing last years massive recalls. In efforts to save their crown, Toyota has started a new marketing campaign asking consumers what they want to see Toyota do with their technology. I think this is a brilliant idea, what other car company has asked "how can we make the world better?". Toyota owns some of the most advanced safety technology in the world including a human body model that can predict injury numbers down to the bone, soft tissue and organs in the body (you may have seen CAE videos of it in their recent commercials). They have teamed up with Wake Forest University to use this technology to create better helmets to reduce concussions in athletes.
This past weekend in class we discussed various research methods. By using a research firm from Michigan, could there be bias involved with their study?
Questions:
1. Do you think that Toyota's new campaign in helping improve brand recognition as a safety leader? Do you think Toyota will actually execute any of the ideas? or this just a gimmick?
2. Evan with Toyota's North American Technical Center located here in Michigan, what are your thought on bias or attitude shift that could be seen in marketing studying centered here in Michigan.
Sunday, January 23, 2011
Changing how we interact and market businesses inside Facebook
Facebook is one of the most popular web site ever! In today’s competitive world, businesses can’t afford ignore the power of Facebook. Facebook offers vast array of explicit and implicit marketing channels – most of which are viral. Microsoft made computers easy for everyone to use. Google helps us search out data. YouTube keeps us entertained. But Facebook has a huge advantage over those other sites: the emotional investment of its users and business communities who want to be connected to these users. Article describes the secrets of using Facebook to market your business. Accordling to this article, inside Facebook everything is possible - offering different spectrum of marketers from brand advertisers to volunteer grassroots evangelists.
Interesting Facts about Facebook:
1. 500 Million users, expected to grow to 1 billion by August 2011
2. Every 60 seconds, 1,800,000 actions are performed on Facebook
3. 2 Million websites are integrated with Facebook…growing by 10,000 more websites integrating everyday
4. Operates in more than 75 languages worldwide
5. Powerful Marketing Tool: Companies are using Facebook to market products across the world
Interesting Facts about Facebook:
1. 500 Million users, expected to grow to 1 billion by August 2011
2. Every 60 seconds, 1,800,000 actions are performed on Facebook
3. 2 Million websites are integrated with Facebook…growing by 10,000 more websites integrating everyday
4. Operates in more than 75 languages worldwide
5. Powerful Marketing Tool: Companies are using Facebook to market products across the world
On Jan 21st, 2011, Facebook raised $1 Billion from investors thru a deal arranged by Goldman Sachs. Facebook says the money gives it greater financial flexibility, but has no immediate plans. So why is this company raising money with no immediate plans? Privately held company currently doesn’t publicly report its financial information and expects to start filing in April 2012! So when I read this article in Wall Street Journal, it got me wondering …
1. Is it a good idea to market on in Facebook, knowing that Facebook is not going public till April 2010 and is it reaching point of saturation that the bubble could burst anytime ?
2. Can Facebook be used to market a product? Has your company started using Facebook to market ? Would that be considered an Opportunity (reach vast customer base across the world) or a Threat (over exposure of your product, safe, secure) ?
Ski resorts market their properties to non-traditional guests
Article: More Ski Resort Customers Leaving Their Skies at Home
The multi-billion-dollar ski industry was (and continues to be) hard-hit by the recession causing many ski resorts to post consistent losses, file for bankruptcy and launch IPOs to raise money to pay off debt. The economic forces of recession / recovery continue to cloud the outlook that many families have on the economy, thus affecting their willingness to spend. This contributes to the slow rebound of the travel industry, causing ski resorts in some cases to compete against warm-weather destinations. As was mentioned in class, the upper class tends to be resilient to the business cycles (the rich stay rich), which explains the consistency that luxury items have enjoyed over the recession. This has prompted a trend by ski resorts toward luxury hotels, multi-million-dollar condos, village shopping, classy dining and non-skiing activities both on and off the mountain. The article highlights some of the initiatives, including those by Vail Resorts in opening new Ritz-Carlton and Marriot hotels last year and restructuring their Lionshead Village at its flagship mountain in Colorado. Kirkwood in Lake Tahoe introduced a tree-to-tree canopy tour, an eight zip-line systems with suspension bridges suspended 90 feet above ski trails. Snow cat tours bring guests to mountaintops for sunset dinner and drinks. The demand for non-skiing outdoor activities such as mountain tubing, snowshoeing and snowmobiling continues to rise. Also, initiatives that appeal to the entire family such as kids clubs, indoor pools and waterparks, and amusement centers are becoming increasingly popular. The strategy seems to be working; Kirkwood’s CEO ties a 16% jump in the company’s ancillary revenue to the alternate services.
What do you think about this strategy by the ski resorts to market their properties to non-traditional guests? Do you feel they have captured the “wants” of these new guests with their “non-ski” outdoor and indoor activities? Do you think this strategy could be damaging?
Are you a skier or boarder? If not, would the “non-ski” outdoor activities or shopping and dining options entice you to head to the mountains for your next winter vacation? What other “non-ski” activities would you recommend to lure the non-traditional vacationers to the mountains?
If you do ski or board, would you extend your trip to try some of the “non-ski” outdoor activities? If so, which ones?
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