For my critique I read Seth Godin’s blog called “Sixty to Zero” and formed the following opinions:
Godin writes about how car companies always market acceleration and other features related to speed but do not market braking. He isn’t meaning for this to be the main topic of the blog, but it is an interesting thought. My conclusion is that braking is not exciting and does not sell, unless the company is Volvo (actually Volvo has a commercial airing right now about automatic braking on the new S60). Acceleration can be a point of difference that makes a car superior to other cars, while it is a basic and rational expectation of the consumer that the car can safely brake in a reasonable time. Fast acceleration is a luxury while braking is a necessity.
Ok, what Godin is meaning to get to is that sometimes marketers have to hit the brakes hard and find out where they are, such as in the newspaper industry. Marketers and the industry in general have no clue how to save print papers. I get all of my news online and feel that my generation will be the generation that kills the print-newspaper industry. A lot of factors come into play on why my generation is not subscribing to papers: (1) all of the information can be found online, plus we can find more specific articles that we want to read; (2) newspapers create a lot of waste and require a large amount of energy to print and deliver; (3) newspaper subscriptions are an added cost that is not necessary; (4) and the list goes on.
Godin makes some bold claims, such as 90% of sales will come from word-of-mouth or digital promotion by 2011. I agree that both are important and word of mouth can be extremely successful, but I do not see where this number comes from. There are many other mediums that marketers use to reach potential customers which I believe account for over 10% of sales. The 2011 deadline may be a little short too since not everybody has the Internet or a PC.
Another claim made is that outsourcing will improve in technology so much that it will be cheaper to outsource than do anything in-house. I agree more with this claim, but sometimes data is confidential and contains business secrets so in-house data functions will always be around. Most outsourcing firms do have a greater competitive advantage and larger economies of scale, but it is unlikely businesses, especially small ones, will outsource everything.
One last claim is that there will be no major print editions of major newspapers by 2012. While print is on the way out the door, it can’t be counted out too soon. Many consumers just like the experience of sitting down to coffee and the paper in the morning and will continue to do this. Large newspapers will likely consolidate or charge higher prices before they completely go away. Once again this is another claim by Godin with no support to back it up. 2012 is in the not-so-distant future and while a few papers will almost surely go under, not everyone will. I think of the Wall Street Journal when this is mentioned; the Journal has a large readership and will likely outlast many of the other papers due to its quality and relevance to the business industry.
After reading the blog and seeing how staples like the newspaper are slowly going away I wonder what other mediums will disappear. In the not so distant future it is likely that cable and satellite may be old news when consumers have on-demand access to every TV show ever made via televisions connected to online databases. My TV viewing habits have been altered due to programs being offered online for free and I see this as a topic that will be important in the future.
Tuesday, April 21, 2009
Monday, April 13, 2009
Paper Outline
Professor Walls, one of my key concerns is that I am writing a paper more focused on private label products and not on insights and experiences. If you would provide feedback on this it would be great. Also, I have not formed all my recommendations yet so I can leave room to be open to additional ideas. I plan to visit several stores this weekend, such as Wal-Mart, HEB and Whole Foods to try to gain insights that I can use in my paper.
I. Introduction
Private label brands provide customers with excellent savings compared to leading national brands, but often do not connect with the customer and achieve the same level of loyalty as leading brands. Lower pricing is the underlying reason most consumers purchase private label products, but past this point the brand/product does not offer the consume the same benefits as a leading brand, such as using Crest with its strong reputation compared to a store brand toothpaste. Gaining insights about how and when customers will use a private label product will benefit both the retailer and the consumer.
Topics to be discussed in the Body are:
i. Article Review
ii. Price Comparisons
iii. Packaging
iv. Risk Reduction in Product Choice
v. Image of Store and Product Association
vi. Loyalty Programs
vii. Successful Private Label Extensions
viii. Personal Opinion and Insights Gained
Body:
Article Review
-In this section I will review articles that I have found; publications include AC Nielsen, Journal of Retailing, Private Label Buyer, and Retail Merchandiser. By beginning with an article review the base of the report can be set up to give the reader a better understanding of some underlying themes the paper will include. Main themes in the paper are listed below and expanded on.
-Price Comparisons: Price comparisons of private label products by category will be expanded on from the AC Nielsen article and Private Label Buyer. Since price is the underlying factor in the purchase of private label brands it is important to begin my article review with this topic.
-The Categories Private Labels are Most Successful: The AC Nielsen article does a great job of breaking down product categories where some private labels even lead the market. An analysis of market share will also be included. Packaging of products can be included in this review too since the packaging of private label products are often associated with the category.
-Risk Reduction: The article in the Journal of Retailing breaks down the role of risk reduction in the purchase of private label products. This is an interesting topic and can lead to insights that will be discussed in my opinion section. Customers will often avoid the purchase of private label products that are highly visible to others and that may receive negative reactions from their peers. Consumers also try to minimize the chance of making a mistake in their purchase by sticking with well-known national brands instead of opting for the less expensive private label.
-Image of the store and associated private label products: Different types of stores choose what products they will produce as private label to be consistent with their image (e.g. Wal-Mart vs. Whole Foods). This topic will also be discussed more in my opinion section.
Personal Opinion Section and Primary Research
In this section I will expand on my secondary research and add my own professional opinion. I will include data that I collect from stores, such as packaging images and prices, for a point of comparison.
-Loyalty Programs: Stores could implement a loyalty program that promotes the continual use of private label products. If a customer is satisfied with the private label products they would be more likely to try other products produced by the store. This type of program could help build a relationship between the company and customer that could lead to other insights. Also, information could be gained on purchase habits and frequencies if a loyalty card is used.
-Private Label Packaging: I would like to include images of private label products that I think the packaging either successful or unsuccessful. Insights could be drawn on patterns and recurring trends in packaging that customers like or dislike. Proper packaging is important for a private label brand to compete with strong national brands.
-Analysis of Product/Store Image: An analysis of the relationship between private label products and the store that produces them can lead to different strategies that can improve the customer-product relationship and lead to insights. I think Whole Foods does a good job at this and would like to expand on their strategies that I think other private label producers could benefit from.
-Refund Policies: Since customers perceive risk when trying a new product that is not a national brand a refund policy if a customer is not fully satisfied could help reduce this risk. An analysis of major private label producers’ policies will be a main source for this section. HEB’s refund policy has encouraged me to try their private label products.
-Open Section: After I conduct my primary research I believe I will gain more insights about the private label consumer. I would like to keep an open mind so that I can add to what I have already learned. I am leaving a section open here so that I feel comfortable adding on to the outline and to encourage additional insights too.
Conclusion:
Private label brands provide an excellent value to consumers, but they usually stop marketing at this point. Gaining more insights about their main consumers and the consumers’ behavior can not only benefit the companies, but the consumer as well.
-Revisit both secondary and primary research
-Emphasize key insights that can be easily implemented
-Closing thoughts
I. Introduction
Private label brands provide customers with excellent savings compared to leading national brands, but often do not connect with the customer and achieve the same level of loyalty as leading brands. Lower pricing is the underlying reason most consumers purchase private label products, but past this point the brand/product does not offer the consume the same benefits as a leading brand, such as using Crest with its strong reputation compared to a store brand toothpaste. Gaining insights about how and when customers will use a private label product will benefit both the retailer and the consumer.
Topics to be discussed in the Body are:
i. Article Review
ii. Price Comparisons
iii. Packaging
iv. Risk Reduction in Product Choice
v. Image of Store and Product Association
vi. Loyalty Programs
vii. Successful Private Label Extensions
viii. Personal Opinion and Insights Gained
Body:
Article Review
-In this section I will review articles that I have found; publications include AC Nielsen, Journal of Retailing, Private Label Buyer, and Retail Merchandiser. By beginning with an article review the base of the report can be set up to give the reader a better understanding of some underlying themes the paper will include. Main themes in the paper are listed below and expanded on.
-Price Comparisons: Price comparisons of private label products by category will be expanded on from the AC Nielsen article and Private Label Buyer. Since price is the underlying factor in the purchase of private label brands it is important to begin my article review with this topic.
-The Categories Private Labels are Most Successful: The AC Nielsen article does a great job of breaking down product categories where some private labels even lead the market. An analysis of market share will also be included. Packaging of products can be included in this review too since the packaging of private label products are often associated with the category.
-Risk Reduction: The article in the Journal of Retailing breaks down the role of risk reduction in the purchase of private label products. This is an interesting topic and can lead to insights that will be discussed in my opinion section. Customers will often avoid the purchase of private label products that are highly visible to others and that may receive negative reactions from their peers. Consumers also try to minimize the chance of making a mistake in their purchase by sticking with well-known national brands instead of opting for the less expensive private label.
-Image of the store and associated private label products: Different types of stores choose what products they will produce as private label to be consistent with their image (e.g. Wal-Mart vs. Whole Foods). This topic will also be discussed more in my opinion section.
Personal Opinion Section and Primary Research
In this section I will expand on my secondary research and add my own professional opinion. I will include data that I collect from stores, such as packaging images and prices, for a point of comparison.
-Loyalty Programs: Stores could implement a loyalty program that promotes the continual use of private label products. If a customer is satisfied with the private label products they would be more likely to try other products produced by the store. This type of program could help build a relationship between the company and customer that could lead to other insights. Also, information could be gained on purchase habits and frequencies if a loyalty card is used.
-Private Label Packaging: I would like to include images of private label products that I think the packaging either successful or unsuccessful. Insights could be drawn on patterns and recurring trends in packaging that customers like or dislike. Proper packaging is important for a private label brand to compete with strong national brands.
-Analysis of Product/Store Image: An analysis of the relationship between private label products and the store that produces them can lead to different strategies that can improve the customer-product relationship and lead to insights. I think Whole Foods does a good job at this and would like to expand on their strategies that I think other private label producers could benefit from.
-Refund Policies: Since customers perceive risk when trying a new product that is not a national brand a refund policy if a customer is not fully satisfied could help reduce this risk. An analysis of major private label producers’ policies will be a main source for this section. HEB’s refund policy has encouraged me to try their private label products.
-Open Section: After I conduct my primary research I believe I will gain more insights about the private label consumer. I would like to keep an open mind so that I can add to what I have already learned. I am leaving a section open here so that I feel comfortable adding on to the outline and to encourage additional insights too.
Conclusion:
Private label brands provide an excellent value to consumers, but they usually stop marketing at this point. Gaining more insights about their main consumers and the consumers’ behavior can not only benefit the companies, but the consumer as well.
-Revisit both secondary and primary research
-Emphasize key insights that can be easily implemented
-Closing thoughts
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