Pricing as Positioning Strategy
Marketers will often use price as a positioning strategy for their product. When they do this they will usually set the price higher than similar competition in order to give the impression that their brand is of higher quality than the competition. People will assume, whether correct or not, many times that the most expensive version is the best quality. One area in which you see this is in kitchen electrics. Certain brands of kitchen electrics have become somewhat of a status symbol amongst women because it is well known that certain brands are more expensive and assumed to be higher quality. One example of this is in coffee makers. If you compare different versions of the single cup coffee maker, they vary widely in price, but upon closer inspection don't actually differ that much in performance. If you compare the Breville single serve coffee maker (retails at $249 - http://www.surlatable.com/product/coffee+%26+tea/drip+coffee+machines/breville+single-serve+coffee+maker.do?sortby=ourPicks#) to the Keurig version (retails at $169 - http://www1.macys.com/catalog/product/index.ognc?ID=315152&CategoryID=44001) you will notice that aside from having a different style look, they are virtually the same machine, there is no technological superiority in the Breville model. In fact the description for it even states "Featuring Keurig’s patented brewing technology, the innovative shower head delivers the precise amount of water at the perfect temperature for balanced flavor." So simply put, you are getting the same exact thing in a different looking case for an extra $80!
New product pricing
Skimming
The practice of skimming is when a company will charge a high price when their product is first introduced and it is usually accompanied by a large marketing campaign. This strategy is typically used when the company realizes that their product is something that won't be copied immediately so they take advantage of being the only game in town so to speak. One great example of this practice is with new toys, especially if Christmas is coming! If you look at toy ads or commercials now you will notice that Disney is starting to heavily promote a new toy called Dance Star Mickey (http://www.toysrus.com/product/index.jsp?productId=4049903). The toy isn't even in the stores yet, but they are advertising it as a hot new toy and encouraging people to pre-order the doll for $69.99! This is obviously price skimming because they will not be able to charge this price for a dancing Mickey doll forever. They will undoubtedly drop the price significantly after Christmas. This is the tickle me Elmo craze all over again! Which by the way now sells for only $24.99.
Penetration
Penetration is when a firm will charge a low price for their product when it is introduced into the market in order to reach more people by undercutting the competition. This is used a lot in electronics. The newest product where I've noticed this pricing strategy employed is Amazon's latest version of the Kindle. They just released in the last couple of weeks their third generation of Kindle, which is not only thinner and has better features like a microphone, smaller size, longer battery life, more storage capacity, lighter weight and better screen contrast, but it is much cheaper than the competition. This has done more than rock the boat, I think it will sink the ship for a few of the other e-book readers out there that just won't be able to cut their price to this level. Amazon has offered the latest Kindle starting at only $139!
You can view the new kindle here:
http://www.amazon.com/Kindle-Wireless-Reader-Wifi-Graphite/dp/B002Y27P3M/ref=amb_link_353611822_4?pf_rd_m=ATVPDKIKX0DER&pf_rd_s=gateway-center-column&pf_rd_r=0G5WG419JPCZA1FBEA4B&pf_rd_t=101&pf_rd_p=1271573382&pf_rd_i=507846
Odd Number Pricing
Marketers use many subtle tactics in pricing to make us believe something about a product. One example is odd number pricing. For some reason, people will typically assume that something that ends with an odd number is a bargain. One store that uses this marketing tactic very well is Total Wine & More (http://www.totalwine.com/Main.aspx). They have signs in their stores and on their circulars reminding buyers that any wine with a price ending in 97 cents is at their "rock bottom" price. In fact, they hold to this statement so much so that they even exclude anything with a price ending in 97 cents from all promotions and coupons. This is a very effective marketing tool for them because it gives the buyer an immediate feeling of getting a bargain even though they might not know the true value of a certain bottle of wine. I also believe that it increases their sales because people who enjoy wine might buy more bottles than they originally intended if they perceive that they are getting a really good deal.
Loss Leader
Loss Leaders seem to be a favorite marketing tool of the grocery store industry. Every week they send out fliers filled with loss leader deals in the hope that they will entice you into their stores where you will not only purchase that one product at a great price, but you will also purchase other products that are not on sale. Unfortunately for the consumer, the products not on sale are typically no bargain at the grocery store. I found one such example in this week's advertisement from Frys ( http://frysfood.inserts2online.com/customer_Frame.jsp ), you can see in the middle slightly to the right is an add for a 64 ounce bottle of apple juice for only $0.99. As a mom that has bought a lot of juice, I can assure you this is a bargain. A bottle that size would typically sell for anywhere from $3-$5 or more depending upon the brand and store purchased. Frys is not having a moment of kindness for families in offering juice at a low price, they know that someone who buys juice probably also buys other kid foods like crackers, peanut butter, chips, etc. That is what they are hoping you will buy when you come into their store, because the other things will not be on sale and those are the items that they are hoping to make their profit on. I personally have a strong dislike for this marketing tactic because I don't like the idea of someone trying to get me into the store with one thing so they can over charge me on five other things. Unfortunately for the grocery stores this doesn't seem to be a very good tool because their margins are historically small and very few grocers actually make good money.
Multiple Unit Pricing
I must admit, I am the biggest sucker for multiple unit pricing. This is when a store will say if you buy product X it is $5, but if you buy two or more of X it will be $4 per item. I fall for it almost every time! You see this used a lot in clothing stores. I found a good example of it on Targets website in their school uniform section, they have the tag line "buy more, save more." I guess they haven't talked to my father who always told me I couldn't spend myself rich when I told him about how much I saved on my last purchase. If you click on this link (http://www.target.com/Girls-School-Uniform-Cherokee-Short-Sleeve/dp/B003BF7Q8K/ref=sr_1_9?ie=UTF8&searchView=grid5&keywords=school%20uniforms&fromGsearch=true&sr=1-9&qid=1280942510&rh=&searchRank=target104545&id=Girls%20School%20Uniform%20Cherokee%20Short-Sleeve&node=1038576|1287991011&searchSize=30&searchPage=1&searchNodeID=1038576|1287991011&searchBinNameList=subjectbin%2Cprice%2Ctarget_com_primary_color-bin%2Ctarget_com_size-bin%2Ctarget_com_brand-bin&frombrowse=0) you can see how Target has displayed this offer very well. They have colored the text red, just like the price so it guides your eye to read their tag line when you look at the price. In my experience I've noticed that this marketing tactic is typically used when the product is something that is either quickly consumable like food or when it is something that people like to have multiples of the product like clothing or art supplies. You won't see this used much in products that people wouldn't want more than one like an iPod or computer.
Wednesday, August 4, 2010
Sunday, August 1, 2010
Assignment #3
Wal-mart
Wal-mart has more retail locations than probably any other store in the world, yet they still use their website to sell goods to customers and to expand their product offerings. The strategy that Wal-mart seems to apply to their website vs store product selection is that the stores stock items that have high demand and quick turnover, whereas their website will have not only those products, but it will also have a wider selection of goods that tend to be large in size and higher in price . For example, on the website you have a much wider selection of furniture, exercise equipment, Hot tubs, baby gear, toys, etc. A lot of these items such as hot tubs would not be practical to stock in their stores because of their size and the fact that there would be a limited amount of sales at each store, so it is more advantageous to them to use that retail space for a product that appeals to more people and will turn over faster. However, it is economically viable for them to have these items on their website because it reaches a much larger audience than any individual store and they can ship the products to wherever the customer is located.
One thing that Wal-mart does extremely well is distribution of their products and they have figured out how to incorporate that with their website offerings through site-to-store shipping. With their site-to-store shipping you can purchase an item online and opt to have it shipped to the local retail location of your choice. You are then notified upon arrival of your purchase and you can go pick it up at the store, all without being charged for shipping. This is an advantage to Wal-mart because it removes the barrier of shipping costs for consumers that are not able or willing to pay the extra charge and it provides a reason why the consumer has to enter their store and may lead to additional sales while that customer is in their store. I believe this feature to be a win win situation for the customer and Wal-mart.
Ann Taylor
Another retailer that has successfully utilized their website to expand their product offerings to their customers is Ann Taylor. Ann Taylor has two different store chains, Ann Taylor and Ann Taylor LOFT and both have expanded their product lines differently on their websites.
Ann Taylor is known for their classic design and good quality. On the Ann Taylor website the company has managed to expand their business by including a limited selection of classic wedding and special event dresses that complement their typical product mix well. This is something that they probably wouldn't be able to do through their retail stores since it would be a large commitment of floor space for a subset of their customers and it would be replacing clothing that would appeal to most or all of their customers. However, by placing the option on their website it is something that they can offer all year without giving up any retail space. The expansion is also good because it is expanding into an area that usually commands a higher price than regular clothing and so should be a highly profitable expansion of their line.
Visit Ann Taylor Weddings & Events:
http://www.anntaylor.com/catalog/department.jsp?N=1200029&categoryId=3942&loc=TN
Ann Taylor LOFT is geared more towards a younger customer base than Ann Taylor and it is more weekend wear type of clothes, where as Ann Taylor offers more work appropriate clothing including suits. Ann Taylor LOFT expanded their product line by venturing into the maternity wear market. I think that this is a sensible expansion for their product line because their main customer base is women that are in their late 20's to early 40's, which includes the typical range of when women will have children. Their maternity clothing line isn't a far departure from their normal clothing line, so many of the outfits are ones that they already had designed, but just required some modifications to the design to accommodate a pregnant woman.
The only downside that I find for the customer in both the Ann Taylor wedding & events line and the Ann Taylor LOFT maternity line is that a lot of the clothing is noted as online exclusive, which means that it cannot be returned to a retail store location, returns need to be processed via mail. I think that stipulation can be a real turn off to some customers, especially in the special event or maternity markets due to there being a higher chance that the garment won't fit properly. There is a big difference between ordering a tank top online or ordering your wedding dress online! It has to fit perfectly or the customer will hate it (and tell all of her friends the story).
Visit Ann Taylor LOFT Maternity:
http://www.anntaylorloft.com/catalog/category.jsp?N=1200041&pCategoryId=3363&categoryId=639&Ns=CATEGORY_SEQ_639&loc=mp1a&gridSize=sm&showAll=true
Harrods
Harrods is one of, if not the, most famous department stores world-wide; but there truly is only one real Harrods department store and that is London. For Harrods, having a website serves multiple functions two of the most important are providing tourist information (yes it's a BIG tourist destination) and selling their products to customers across the globe. Having a website allows Harrods to provide products to their customers in 40 different countries, instead of being limited to just the local London area. This expansion of their reach is obviously very beneficial to them since they are well known around the world, so some demand was already present in these markets prior to their creation of a website. While there are a lot of products available on their site, there are still some that you can only get in the store; those tend to be the more exclusive items that are designed for the rich and famous crowd. For example, if you look at their store guide on their website you will see that on the fifth floor they actually have an entire section dedicated to bulletproof clothing that they describe as being "tough enough to withstand fire from automatic weapons" and "unobtrusive enough to be worn at parties."
http://www.harrods.com/harrodsstore/
Wal-mart has more retail locations than probably any other store in the world, yet they still use their website to sell goods to customers and to expand their product offerings. The strategy that Wal-mart seems to apply to their website vs store product selection is that the stores stock items that have high demand and quick turnover, whereas their website will have not only those products, but it will also have a wider selection of goods that tend to be large in size and higher in price . For example, on the website you have a much wider selection of furniture, exercise equipment, Hot tubs, baby gear, toys, etc. A lot of these items such as hot tubs would not be practical to stock in their stores because of their size and the fact that there would be a limited amount of sales at each store, so it is more advantageous to them to use that retail space for a product that appeals to more people and will turn over faster. However, it is economically viable for them to have these items on their website because it reaches a much larger audience than any individual store and they can ship the products to wherever the customer is located.
One thing that Wal-mart does extremely well is distribution of their products and they have figured out how to incorporate that with their website offerings through site-to-store shipping. With their site-to-store shipping you can purchase an item online and opt to have it shipped to the local retail location of your choice. You are then notified upon arrival of your purchase and you can go pick it up at the store, all without being charged for shipping. This is an advantage to Wal-mart because it removes the barrier of shipping costs for consumers that are not able or willing to pay the extra charge and it provides a reason why the consumer has to enter their store and may lead to additional sales while that customer is in their store. I believe this feature to be a win win situation for the customer and Wal-mart.
Ann Taylor
Another retailer that has successfully utilized their website to expand their product offerings to their customers is Ann Taylor. Ann Taylor has two different store chains, Ann Taylor and Ann Taylor LOFT and both have expanded their product lines differently on their websites.
Ann Taylor is known for their classic design and good quality. On the Ann Taylor website the company has managed to expand their business by including a limited selection of classic wedding and special event dresses that complement their typical product mix well. This is something that they probably wouldn't be able to do through their retail stores since it would be a large commitment of floor space for a subset of their customers and it would be replacing clothing that would appeal to most or all of their customers. However, by placing the option on their website it is something that they can offer all year without giving up any retail space. The expansion is also good because it is expanding into an area that usually commands a higher price than regular clothing and so should be a highly profitable expansion of their line.
Visit Ann Taylor Weddings & Events:
http://www.anntaylor.com/catalog/department.jsp?N=1200029&categoryId=3942&loc=TN
Ann Taylor LOFT is geared more towards a younger customer base than Ann Taylor and it is more weekend wear type of clothes, where as Ann Taylor offers more work appropriate clothing including suits. Ann Taylor LOFT expanded their product line by venturing into the maternity wear market. I think that this is a sensible expansion for their product line because their main customer base is women that are in their late 20's to early 40's, which includes the typical range of when women will have children. Their maternity clothing line isn't a far departure from their normal clothing line, so many of the outfits are ones that they already had designed, but just required some modifications to the design to accommodate a pregnant woman.
The only downside that I find for the customer in both the Ann Taylor wedding & events line and the Ann Taylor LOFT maternity line is that a lot of the clothing is noted as online exclusive, which means that it cannot be returned to a retail store location, returns need to be processed via mail. I think that stipulation can be a real turn off to some customers, especially in the special event or maternity markets due to there being a higher chance that the garment won't fit properly. There is a big difference between ordering a tank top online or ordering your wedding dress online! It has to fit perfectly or the customer will hate it (and tell all of her friends the story).
Visit Ann Taylor LOFT Maternity:
http://www.anntaylorloft.com/catalog/category.jsp?N=1200041&pCategoryId=3363&categoryId=639&Ns=CATEGORY_SEQ_639&loc=mp1a&gridSize=sm&showAll=true
Harrods
Harrods is one of, if not the, most famous department stores world-wide; but there truly is only one real Harrods department store and that is London. For Harrods, having a website serves multiple functions two of the most important are providing tourist information (yes it's a BIG tourist destination) and selling their products to customers across the globe. Having a website allows Harrods to provide products to their customers in 40 different countries, instead of being limited to just the local London area. This expansion of their reach is obviously very beneficial to them since they are well known around the world, so some demand was already present in these markets prior to their creation of a website. While there are a lot of products available on their site, there are still some that you can only get in the store; those tend to be the more exclusive items that are designed for the rich and famous crowd. For example, if you look at their store guide on their website you will see that on the fifth floor they actually have an entire section dedicated to bulletproof clothing that they describe as being "tough enough to withstand fire from automatic weapons" and "unobtrusive enough to be worn at parties."
http://www.harrods.com/harrodsstore/
Friday, July 23, 2010
Blog Assignment #2
Costco
The practice of buying in bulk at low prices is something that is common to American's, but is still a relatively new idea for other cultures. The presentation and content of Costco's various websites around the globe demonstrates how they need to adapt their website to the local cultures familiarity with their brand.
Costco's website for the United States is all about selling. As soon as you log onto the home page you are presented with several different items that are on sale that week and there are over twenty different tabs you can choose to select what category of goods you want to view, these are the most prominent tabs on the site. The second most prominent tabs are for the various services you can procure through Costco. If you want to find company information, job opportunities or contact information it is all less obviously displayed and you need to look around a bit for it. The assumption behind this type of layout is that the consumer visiting the site is very familiar with Costco's business and that they are coming to the site to shop. While this approach is fine for the United States, it is not the strategy taken for their foreign sites.
When you visit sites for Costco in other countries you will notice that their website is a very different experience. While it still has a similar layout and feel there is far less on the websites and the immediate message you receive is different. For example if you view Costco's sites for the United Kingdom (www.costco.co.uk/) or Australia (www.costco.com.au/) you will notice that instead of over 20 tabs for viewing goods to purchase there are none; you can't purchase from their website. The information is all about what Costco is, why it is beneficial to you and where you can find their store. The pictures and messages have also been adapted for the local culture. For example, the home page of Costco's Australian site shows people with a cart overflowing with products which are familiar to the local people, such as Vegemite and Omo.
The reason that Costco has to make their websites around the world so different is because they currently have different goals for their websites. In the United States the website is an inexpensive distribution channel and a place where Costco can offer products that would be inconvenient to carry in their stores (furniture, spas, home-remodeling supplies, etc). However, in other parts of the world, Costco's website is a tool that they can use to educate people about what their store sells, how the customer will benefit from membership and draw people into their stores. Their main need is to spread the word about Costco as opposed to selling specific products and a website is an efficient tool for this purpose.
Mc Donald's
McDonald's is a globally known product, so unlike Costco people all over the world will know their business and they don't have to educate people on what they do. Everyone knows that McDonald's is a fast food restaurant. The difference between McDonald's marketing in different countries appears to focus more on attracting customers to their restaurant based upon differences in local values. For example, the McDonald's website for the United States (www.mcdonalds.com) has a large advertisement for their new fruit smoothie and is attempting to convey to the consumer that their meals are healthy. However, when you look at the McDonald's website for India (http://www.mcdonaldsindia.com/mc.html) not only are some of their product offerings different due to the culture, so is their main message. In India, where the cow is sacred, you will notice that there is not a single beef item on the menu. They also are stressing the convenience and enjoyment of having a McDonald's meal, as opposed to their message of health in the United States. In Australia (http://mcdonalds.com.au/#/home), their marketing message is that the meal is satisfying and filling. So while all three websites are marketing the same restaurant, they are all selling it as a different experience based upon what they determined the local market desires.
Wrangler
When most American's think of Wrangler they probably think of the classic blue-collar American worker on a farm or in a factory. Wrangler however portrays their product in a wide variety of ways depending upon the audience, while still centering the idea around the rugged American vision. If you visit Wrangler's website for the United States (http://www.wrangler.com/home) you see how they play up the country-western angle and picture several American celebrities that are involved in classic American celebrity circles such as Nascar or country music. They portray their product as very down-to-earth, high-quality and durable. However, if you visit one of their international sites you will get a very different image of the blue-collar American. Wrangler has a common site for all of the Asia-Pacific region (http://www.wrangler-ap.com/main.aspx?countryId=68&cc=SG) that makes their product appear blue-collar, but a more sexy version than on their US site. Who knew that you could give Wranglers sex appeal?! The Asia-Pacific website has a much more artistic styling to it and some interactive features that you don't see on the US site. You will get yet another completely different view of Wrangler if you visit their European website (http://www.wrangler-europe.com/en/bluebell#/slide2). This site portrays the same blue-collar American type of character, but instead of being a sexy image, it is more of a rebellious/dangerous portrayal of the character. The site is a lot more interactive with videos that you click on to initiate actions of the character. While both the Asia-Pacific and European websites will show you the Wrangler collection, only the US site will allow you to purchase their product through the site.
While Wrangler is selling the same pair of jeans to people in all three of these regions, the people are buying them for different reasons, which is why they have to portray their brand differently in each area. When Americans buy Wrangler, they are buying them for the perceived quality and durability of the product as well as the value. However, when customers in foreign markets buy Wrangler, they are buying the product because they want to own a piece of the American lifestyle. Wrangler has to play to the image that various regions of the world have of the classic American lifestyle in order for their product to appeal to international customers.
The practice of buying in bulk at low prices is something that is common to American's, but is still a relatively new idea for other cultures. The presentation and content of Costco's various websites around the globe demonstrates how they need to adapt their website to the local cultures familiarity with their brand.
Costco's website for the United States is all about selling. As soon as you log onto the home page you are presented with several different items that are on sale that week and there are over twenty different tabs you can choose to select what category of goods you want to view, these are the most prominent tabs on the site. The second most prominent tabs are for the various services you can procure through Costco. If you want to find company information, job opportunities or contact information it is all less obviously displayed and you need to look around a bit for it. The assumption behind this type of layout is that the consumer visiting the site is very familiar with Costco's business and that they are coming to the site to shop. While this approach is fine for the United States, it is not the strategy taken for their foreign sites.
When you visit sites for Costco in other countries you will notice that their website is a very different experience. While it still has a similar layout and feel there is far less on the websites and the immediate message you receive is different. For example if you view Costco's sites for the United Kingdom (www.costco.co.uk/) or Australia (www.costco.com.au/) you will notice that instead of over 20 tabs for viewing goods to purchase there are none; you can't purchase from their website. The information is all about what Costco is, why it is beneficial to you and where you can find their store. The pictures and messages have also been adapted for the local culture. For example, the home page of Costco's Australian site shows people with a cart overflowing with products which are familiar to the local people, such as Vegemite and Omo.
The reason that Costco has to make their websites around the world so different is because they currently have different goals for their websites. In the United States the website is an inexpensive distribution channel and a place where Costco can offer products that would be inconvenient to carry in their stores (furniture, spas, home-remodeling supplies, etc). However, in other parts of the world, Costco's website is a tool that they can use to educate people about what their store sells, how the customer will benefit from membership and draw people into their stores. Their main need is to spread the word about Costco as opposed to selling specific products and a website is an efficient tool for this purpose.
Mc Donald's
McDonald's is a globally known product, so unlike Costco people all over the world will know their business and they don't have to educate people on what they do. Everyone knows that McDonald's is a fast food restaurant. The difference between McDonald's marketing in different countries appears to focus more on attracting customers to their restaurant based upon differences in local values. For example, the McDonald's website for the United States (www.mcdonalds.com) has a large advertisement for their new fruit smoothie and is attempting to convey to the consumer that their meals are healthy. However, when you look at the McDonald's website for India (http://www.mcdonaldsindia.com/mc.html) not only are some of their product offerings different due to the culture, so is their main message. In India, where the cow is sacred, you will notice that there is not a single beef item on the menu. They also are stressing the convenience and enjoyment of having a McDonald's meal, as opposed to their message of health in the United States. In Australia (http://mcdonalds.com.au/#/home), their marketing message is that the meal is satisfying and filling. So while all three websites are marketing the same restaurant, they are all selling it as a different experience based upon what they determined the local market desires.
Wrangler
When most American's think of Wrangler they probably think of the classic blue-collar American worker on a farm or in a factory. Wrangler however portrays their product in a wide variety of ways depending upon the audience, while still centering the idea around the rugged American vision. If you visit Wrangler's website for the United States (http://www.wrangler.com/home) you see how they play up the country-western angle and picture several American celebrities that are involved in classic American celebrity circles such as Nascar or country music. They portray their product as very down-to-earth, high-quality and durable. However, if you visit one of their international sites you will get a very different image of the blue-collar American. Wrangler has a common site for all of the Asia-Pacific region (http://www.wrangler-ap.com/main.aspx?countryId=68&cc=SG) that makes their product appear blue-collar, but a more sexy version than on their US site. Who knew that you could give Wranglers sex appeal?! The Asia-Pacific website has a much more artistic styling to it and some interactive features that you don't see on the US site. You will get yet another completely different view of Wrangler if you visit their European website (http://www.wrangler-europe.com/en/bluebell#/slide2). This site portrays the same blue-collar American type of character, but instead of being a sexy image, it is more of a rebellious/dangerous portrayal of the character. The site is a lot more interactive with videos that you click on to initiate actions of the character. While both the Asia-Pacific and European websites will show you the Wrangler collection, only the US site will allow you to purchase their product through the site.
While Wrangler is selling the same pair of jeans to people in all three of these regions, the people are buying them for different reasons, which is why they have to portray their brand differently in each area. When Americans buy Wrangler, they are buying them for the perceived quality and durability of the product as well as the value. However, when customers in foreign markets buy Wrangler, they are buying the product because they want to own a piece of the American lifestyle. Wrangler has to play to the image that various regions of the world have of the classic American lifestyle in order for their product to appeal to international customers.
Wednesday, July 21, 2010
Microsoft - The King of Planned Obsolescence
In layman's terms planned obsolescence is when a company deliberately makes their product obsolete either by issuing a newer incompatible version or by stopping the service/support of their product prior to the end of its actual useful life. Microsoft does this constantly with their products, the most prevalent being their Microsoft office software suite.
Every few years Microsoft comes out with a new version of Microsoft office and the new version isn't necessarily any different than the last version. For example, if you compare their 2003 and 2007 versions of Excel there is no great leap in functionality. The main difference is the layout, which they claim was for ease of use; however there are still some things that I have not been able to find in the 2007 version. That's okay though, because they have now put out Microsoft Office 2010 so I can start relearning Microsoft Office, again.
In my opinion the new versions are published primarily due to a desire for more profit, not due to any great technological breakthrough or public demand for change. Microsoft knows that eventually, everyone will have to upgrade because of their market dominance. They also know that once they stop supporting a particular version, IT departments in companies all over will follow suit and no longer provide support for that version and anyone left with the old version will be forced to upgrade.
Provided below is a link to an interesting comparison between Excel 2003 and Excel 2007, you will notice that there are some people for whom they recommend not upgrading due to a decrease in certain functionalities between the versions.
http://www.add-ins.com/Excel%202003%20versus%202007.htm
Every few years Microsoft comes out with a new version of Microsoft office and the new version isn't necessarily any different than the last version. For example, if you compare their 2003 and 2007 versions of Excel there is no great leap in functionality. The main difference is the layout, which they claim was for ease of use; however there are still some things that I have not been able to find in the 2007 version. That's okay though, because they have now put out Microsoft Office 2010 so I can start relearning Microsoft Office, again.
In my opinion the new versions are published primarily due to a desire for more profit, not due to any great technological breakthrough or public demand for change. Microsoft knows that eventually, everyone will have to upgrade because of their market dominance. They also know that once they stop supporting a particular version, IT departments in companies all over will follow suit and no longer provide support for that version and anyone left with the old version will be forced to upgrade.
Provided below is a link to an interesting comparison between Excel 2003 and Excel 2007, you will notice that there are some people for whom they recommend not upgrading due to a decrease in certain functionalities between the versions.
http://www.add-ins.com/Excel%202003%20versus%202007.htm
3DTV - An example of demand side market failure
There are many gadgets and toys that a person can buy when they walk into a consumer electronics store, but do we really them if they could potentially harm us? One new item on the market is the 3D LCD television. Not only does this new TV require that you wear special glasses to get the full experience, there are some people that they warn not to watch it due to potential health hazards. Do we really need a television in our home that the manufacturer warns pregnant women not to watch? I wonder what Samsung expects you to do if you get pregnant and already own their TV?
I think it is not only irresponsible, but unethical to produce a television that certain people can't watch without risking their health, especially when it is something as common as a television and they group that must avoid it is as common as pregnant women. Samsung also has the following warnings for the average viewer: "Viewing 3D television may also cause motion sickness, perceptual after effects, disorientation, eye strain and decreased postural stability,...It is recommended that users take frequent breaks to lessen the potential of these effects. If your eyes show signs of fatigue or dryness or if you have any of the above symptoms, immediately discontinue use of this device and do not resume using it for at least thirty minutes after the symptoms have subsided."
I also find it unethical that these issues are not disclosed in their advertising.
Here is one of their advertisements where there is absolutely no indication that some people should not use their device:
Here is an article on CNN where they discuss the warnings that Samsung has issued about their 3D product:
http://scitech.blogs.cnn.com/2010/04/15/samsung-issues-warnings-about-3-d-tv/
Tuesday, July 20, 2010
First time parents - the perfect group where you can successfully market unnecessary goods
When it comes to buying things for a first child, a lot of parents buy unnecessary items because they've been convinced by marketers that it is something they need. I think that a lot of marketers rely on the fact that first time parents don't know what they need and are quite frankly nervous about the impending major life change. When someone is expecting a child they are probably going to read books, take classes and/or talk to other people that they know who have children to try to determine just what they need to supply themselves with in order to be prepared for raising a child. In actuality, you could probably get by with a short list of necessities, but baby gear and accessories has become a major market in the United States. I feel it is unethical to prey on people that you know don't have a clue about what is in store for them. Below are some examples of items that while they are completely unnecessary, have actually become quite popular:
Bathrobes for babies:
When is your baby going to hang around home in a robe? You wash them, then dress them people!
Baby Swaddler:
While it is true that babies like to be swaddled, there is no efficiency or convenience savings by using a Velcro closure as opposed to swaddling them in a blanket. What they don't tell you is that most newborns don't swaddle for long, my daughter did it for only two weeks.
Wipe Warmers:
Why would anyone need to pay $25 so that their child's wipe could be warm? It's not like they are kept in the refrigerator, then tend to be room temperature anyway.
Bathrobes for babies:
When is your baby going to hang around home in a robe? You wash them, then dress them people!
Baby Swaddler:
While it is true that babies like to be swaddled, there is no efficiency or convenience savings by using a Velcro closure as opposed to swaddling them in a blanket. What they don't tell you is that most newborns don't swaddle for long, my daughter did it for only two weeks.
Wipe Warmers:
Why would anyone need to pay $25 so that their child's wipe could be warm? It's not like they are kept in the refrigerator, then tend to be room temperature anyway.
Payday lending - The epitome of unethical lending
As long as there is money there will be people that need to borrow money. While there isn't anything unethical about lending someone money and charging interest, ethics does come into play when the interest rate charged is exorbitant. Payday lending, in my opinion, takes advantage of people who are already near the bottom of the economic totem pole by charging them unreasonable interest rates because they know their clients don't have many alternatives to borrow cash. It is also unethical because they realize that once someone becomes a client they are likely to need to continue being a client because they will have difficulty getting out of the cycle of borrowing due to having a low income. They basically are selling a financial trap and they know it!
Simply put, payday lending is when people borrow small amounts of cash - typically $100-$1,500 - to hold them over to their next paycheck. As of July 1, 2010 Arizona's law that allowed payday lending to charge beyond the standard 36 percent rate cap for the state has expired and will not be renewed. Lenders in Arizona were legally charging as much as 460 percent annually for these loans. There is no legitimate reason why a bank should have to charge 460 percent annual interest for any loan. If that is what they require in order to operate, then they really shouldn't be operating. Since the temporary law that allowed these outrageous rates is now going to expire payday lenders are packing up and leaving the state, making their product a failure in Arizona.
Here is an article on the recent events in Arizona where I found some of my statistics if you are interested:
http://www.azcentral.com/community/phoenix/articles/2010/06/27/20100627payday-lenders-quit.html
Here is also a news report about the dangers of payday lending and how they have been addressed in Ohio:
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