Summary:
November 27th this year marks Black Friday, the day after Thanksgiving in the United States. Black Friday is said to be the start of the Holiday shopping when stores start making profits. Many shoppers wait in long lineups outside stores for dramatically discounted items on this day. However, it seems that shoppers are finding alternative ways to purchase goods. Conventional in-store shopping is expected to decline by 3% this year, meanwhile online sales are expected to grow by 11%. So what makes online shopping such an attractive way of purchasing goods? First off you can avoid the time and money wasted for transportation to the stores. In addition you can avoid lineups and local sales taxes if you purchase goods online. Amazon, an online commerce giantsaw its sales rise $5.5 billion in the third quarter of the year even through the recession. Large companies are finding that they have to offer their goods online as well as in stores to keep up with the rapidly changing market. Companies such as Macy's are also cashing in with online retailing websites. It is reported that for every dollar a customer spends online at the Macy's website they spend $5.70 in the store within the next 10 days.
Connections:
This article is based on non-store retailing. Since the book was made year before internet retailing came out it is not mentioned. However, internet retailing is a form of non store retailing that has rapidly gained popularity in the recent years. It is becoming one of the more common ways of acquiring goods. This article also mentions several types of stores such as department stores and general merchandising retailers. These are the different stores mentioned in the articles that hold major discounts on Black Friday. Many stores are also adopting an integrated channel of distribution. Consumer good companies such as Procter & Gamble are selling goods online straight to the consumer skipping the retailer and wholesaler step. With reduced steps in the channel of distribution of a good, goods can be offered at a lower price because there are less transactions.
Reflection:
This article has quite an interesting concept companies of cashing in on internet retailing. I found the report with Macy’s really surprising, how for everyone one dollar a person spends online at their website, within ten days they will spend $5.70 in their stores. Retailing is rapidly changing; a decade ago internet retailing was unheard of. However, internet shopping is now becoming a common way to purchase goods. I personally don’t see my parents purchase goods online often due to the security issue with credit card numbers. However websites online generally offer brands for a lot cheaper than in stores because they are skipping the retail step of the channels of distribution. Perhaps if the security issue was solved internet retailing would be a lot more common.
Thursday, December 3, 2009
Wednesday, November 18, 2009
Chapter 1 Blog: Increased Producer Prices
http://news.bbc.co.uk/2/hi/business/7348602.stm
Summary:
This article was published in April of 2008 discussing how the price of goods brought from the producers is rapidly increasing. Prices of goods purchased from consumers have rose by 1.1% in the month March 2008. The reason why producers are increasing the costs of their goods is because of the increased energy price. It is thought that such a large change in price of goods can greatly reduce company profits and can have a large economic effect. The prices from inflation generally appear earlier in the chain of production where the producers are before it affects the retailers and consumers. From April 2007 at the same time in the year producer prices of goods have collectively increased on a total average of 6.9%.
Connections
This article is quite closely related to Chapter 1, in the “Marketing Today” text book. The article mainly talks about the producers increasing the prices of their products due to increased energy price. It has a chain reaction on the channel of distribution because when the producers increase the prices of their products it affects everyone else in the chain of production after them. If the producer increases the prices in the products they sell to the wholesaler it will lead to the wholesaler increasing the prices they sell their goods to retailers to minimize the loss from buying products at an increased price. If the retailers purchase products at an increased price from the wholesaler they too will increase the prices of their products that they sell to us, the consumers.
Reflection
This snowball effect of which a very small increase in price from the producer can have on everyone is quite an interesting concept. Even if the producers increase the price of their products by one percent it can have a big snowball effect. Each step on in the channel of distribution will increase the price of its products a bit more to minimize losses from buying the products at an increased price. A small increase of price in the producer can have a snowball effect and affect us, the consumers greatly. I constantly hear on the channel 11 news how the stock market has crashed and how much inflation there has been in the recent years. I remember the time when a large bags of lays chips was $1.50 each. I'm now seeing the mini sized bag of chips sell for $1.50 and large bags selling for twice that amount at $3.00. It's quite shocking how even in my short lived life of 15 years I notice how there are such dramatic changes in prices of goods.
Summary:
This article was published in April of 2008 discussing how the price of goods brought from the producers is rapidly increasing. Prices of goods purchased from consumers have rose by 1.1% in the month March 2008. The reason why producers are increasing the costs of their goods is because of the increased energy price. It is thought that such a large change in price of goods can greatly reduce company profits and can have a large economic effect. The prices from inflation generally appear earlier in the chain of production where the producers are before it affects the retailers and consumers. From April 2007 at the same time in the year producer prices of goods have collectively increased on a total average of 6.9%.
Connections
This article is quite closely related to Chapter 1, in the “Marketing Today” text book. The article mainly talks about the producers increasing the prices of their products due to increased energy price. It has a chain reaction on the channel of distribution because when the producers increase the prices of their products it affects everyone else in the chain of production after them. If the producer increases the prices in the products they sell to the wholesaler it will lead to the wholesaler increasing the prices they sell their goods to retailers to minimize the loss from buying products at an increased price. If the retailers purchase products at an increased price from the wholesaler they too will increase the prices of their products that they sell to us, the consumers.
Reflection
This snowball effect of which a very small increase in price from the producer can have on everyone is quite an interesting concept. Even if the producers increase the price of their products by one percent it can have a big snowball effect. Each step on in the channel of distribution will increase the price of its products a bit more to minimize losses from buying the products at an increased price. A small increase of price in the producer can have a snowball effect and affect us, the consumers greatly. I constantly hear on the channel 11 news how the stock market has crashed and how much inflation there has been in the recent years. I remember the time when a large bags of lays chips was $1.50 each. I'm now seeing the mini sized bag of chips sell for $1.50 and large bags selling for twice that amount at $3.00. It's quite shocking how even in my short lived life of 15 years I notice how there are such dramatic changes in prices of goods.
Tuesday, November 3, 2009
Shockvertising
Summary:
A 10 million dollar lawsuit was made by a woman who was led to believe that she was being stalked. She was sent emails and videos of someone following her in a car that Toyota was trying to advertise through "shockvertising". The form of advertising where you try to frighten people to advertise a product is known as "shockvertising" or terror marketing. Lindsay Meredith a business professor at SFU says that for an ad to be remembered it has to be stand out from all of the others. She compares advertising to a knife, and says that if you’re careful with it, it can be successful. However, if you are not careful with your ad/knife you can get yourself hurt/sued. Oliver Gleeson a vice president of Aylmer’s Pasta company says he doesn't want to advertise their pasta with a commercial that "zooms in on green peppers while a guy with a gravely voice talks about the sauce". He says it is funny how thousands of people can enjoy an ad, but it only takes one person to get offended who calls the competition Bureau to sue the company.
Connections:
This "shockvertising" article has many different connections with Chapter 2 in the Marketing Today textbook. The very first one would be the use of niche marketing. The shockvertising article shows many different examples of niche marketing used in shockvertising such as Diesel having a woman breast feed rotten meat in an attempt to advertise jeans. This advertisement is targeting teenagers and young adults. Another connection to the text is the concept of freedom. Freedom in Canada is the idea that people are free to do whatever they please as long as it doesn't hurt others. This article is asking the same question, "Is this form of advertising that Toyota did go too far?”. Did they go overboard in making someone believe that there was a person stalking them in attempt to advertise a car? The last connection in this article is the idea of demographics. An ad might appeal to teenagers, but it can offend adults. There must be proper research done in order for an ad to be successful.
Reflection:
I personally believe that the advertising Toyota did went a bit overboard. Sure it was unique, and most people would have found the ad entertaining, but they forgot to consider the slight possibility that someone actually take the ad seriously. I believe that it is true that an ad has to be different to be remembered, I find myself mindlessly watching commercials on TV not giving them a thought. The only ones that I remember are the ones that are humorous or the ones with a catchy clip of a song. Also proper research should be done on the demographics of the audience so that the advertisements will appeal to that audience being advertised to and to reduce the amount of viewers that may become offended by the ad.
A 10 million dollar lawsuit was made by a woman who was led to believe that she was being stalked. She was sent emails and videos of someone following her in a car that Toyota was trying to advertise through "shockvertising". The form of advertising where you try to frighten people to advertise a product is known as "shockvertising" or terror marketing. Lindsay Meredith a business professor at SFU says that for an ad to be remembered it has to be stand out from all of the others. She compares advertising to a knife, and says that if you’re careful with it, it can be successful. However, if you are not careful with your ad/knife you can get yourself hurt/sued. Oliver Gleeson a vice president of Aylmer’s Pasta company says he doesn't want to advertise their pasta with a commercial that "zooms in on green peppers while a guy with a gravely voice talks about the sauce". He says it is funny how thousands of people can enjoy an ad, but it only takes one person to get offended who calls the competition Bureau to sue the company.
Connections:
This "shockvertising" article has many different connections with Chapter 2 in the Marketing Today textbook. The very first one would be the use of niche marketing. The shockvertising article shows many different examples of niche marketing used in shockvertising such as Diesel having a woman breast feed rotten meat in an attempt to advertise jeans. This advertisement is targeting teenagers and young adults. Another connection to the text is the concept of freedom. Freedom in Canada is the idea that people are free to do whatever they please as long as it doesn't hurt others. This article is asking the same question, "Is this form of advertising that Toyota did go too far?”. Did they go overboard in making someone believe that there was a person stalking them in attempt to advertise a car? The last connection in this article is the idea of demographics. An ad might appeal to teenagers, but it can offend adults. There must be proper research done in order for an ad to be successful.
Reflection:
I personally believe that the advertising Toyota did went a bit overboard. Sure it was unique, and most people would have found the ad entertaining, but they forgot to consider the slight possibility that someone actually take the ad seriously. I believe that it is true that an ad has to be different to be remembered, I find myself mindlessly watching commercials on TV not giving them a thought. The only ones that I remember are the ones that are humorous or the ones with a catchy clip of a song. Also proper research should be done on the demographics of the audience so that the advertisements will appeal to that audience being advertised to and to reduce the amount of viewers that may become offended by the ad.
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