Giacomo Macchi's Blog

The European low-cost airline EasyJet celebrated 20 years of activity last Tuesday. At the same time, it hit a new profit record with 18% pre-tax increase of profits at the end of September.

Even though profitability in the airline industry is difficult to obtain, EasyJet managed to earn high profits at relatively low prices. Because of its cheap fees, the company revolutionized the flight industry by making flying affordable to almost everyone.

Based on personal experience, however, revolutionary prices not always corresponded to the best customer service. As a result, following its 20 years’ anniversary, EasyJet has finally introduced a loyalty program for frequent flyers who fly more than 20 times a year with the airline. In accordance to the company’s low spending and pricing policy, the reward systems is carried out in a simpler and cheaper way than the one usually provided by airlines. It is based on tickets flexibility, a specialized customer service and exclusive price guarantees.

That is not all. Its 20^th anniversary was also an occasion to develop a tighter relationship with the customers. In particular, the firm painted its anniversary aircraft with customers’ favourite pictures of European Vacations with the airline.

EasyJet is finally adding onto its apathetic cheap prices. Yes, cheap prices attract more customers, but loyalty and word of mouth can make the real difference.

Credits

Topham, Gwyn. “EasyJet Launches Loyalty Scheme as Airline Celebrates 20 Years in the Sky.” The Guardian. © 2015 Guardian News and Media Limited, 10 Nov. 2015. Web. 17 Nov. 2015.

Farrell, Sean. “EasyJet Profits Hit Record for Fifth Consecutive Year.” The Guardian. © 2015 Guardian News and Media Limited, 17 Nov. 2015. Web. 17 Nov. 2015.

Thompson, Nigel. “Video – EasyJet Unveils New Aircraft Paint Job.” Mirror. MGN Ltd, 03 Feb. 2015. Web. 17 Nov. 2015.

The Volkswagen emission scandal has damaged one of the world’s most renowned car brands. According to an estimate offered by Credit Suisse, the brand could suffer of $86 billion losses.

In order to mitigate the effects of the crisis, VW is looking for redemption. On this perspective, the car manufacturer will be focusing more on hybrid models and engines with the most forefront efficient and low-pollution technologies. In particular, research would be moving from low-range plug-in hybrid products, such as the Polo GTE and the Passat GTE, to plug-in hybrid products with a higher mileage range.

By focusing its products on hybrid cars, the brand would have to regulate its business strategy. Since hybrid models are relatively less popular then the regular gasoline powered one, this would potentially reduce the market share. Yet, more research in hybrid cars might benefit the whole society, developing affordable, efficient, and eco-friendly vehicles.

The drastic change to a “green” product line might positively influence other car manufacturers as well. Even though other producers of diesel cars have not encountered the same problem, the investigations reported differences between test emissions and road emissions, which might lead to an adjustment to major research in non-diesel, electrical vehicles.

Many depict the scandal as dreadful for the economy and society as a whole. However, the event might even benefit us by fostering the use and research for eco-friendly vehicles and highlighting the importance of a ethical and sustainable business decisions.

Credits

Paukert, Chris. “Volkswagen Emissions Scandal Could Cost $86 Billion, Report Says – CNET.” CNET. CBS Interactive Inc., 2 Oct. 2015. Web. 17 Nov. 2015.

Cremer, Andreas, and Jan Schwartz. “Volkswagen’s Chosen Path To Redemption? Turning Into Tesla 2.0.” Volkswagen’s Chosen Path To Redemption? Turning Into Tesla 2.0. N.p., 13 Oct. 2015. Web. 17 Nov. 2015.

The shoe brand “Toms” had the courage to develop a new sustainable business idea. Its one-for-one way of selling products sparked a new trend that aims to create social value through donations for each item purchased. However, as its successful business model spread in other industries, many pointed out the clear inconsistencies related to the effectiveness of its charitable donations.

As Sharon Shamuyarira reports on her blog, businesses that make one-for-one donations to communities in need, fail to assess and operate at the root of the problem. Essentially, by donating pairs of shoes, Toms improves the conditions of needy individuals temporarily without any durable changes to their living condition. Most importantly, when relying excessively on the charitable initiatives of the company, the local development might suffer.

In contrast to the idea expressed on the blog, not all donations that follow this pattern fail to heal certain societal problems. For example, one-for-one donations that involve improving the health of a certain community might benefit its general well being. Consequently, better living conditions might benefit productivity and businesses and gradually eradicate underdevelopment.

One-for-one donations can be very effective to eradicate societal issues only when meeting the primary needs preventing the development of a community. On this perspective, instead of gifting items such as shoes, Toms must rather focus its charitable donations on resources that support a basic but durable development of the needy communities.

Credits

“The One-for-one Business Model: Avoiding Unintended Consequences.” Knowledge Wharton The Oneforone Business Model Avoiding Unintended Consequences Comments. Wharton School of the University of Pennsylvania, 16 Feb. 2015. Web. 17 Nov. 2015.

Davenport, Cheryl. “The Broken “Buy-One, Give-One” Model: 3 Ways To Save Toms Shoes.” Fast Company & Inc © 2015 Mansueto Ventures, LLC, 10 Apr. 2012. Web. 17 Nov. 2015.

The Expo Milano 2015 Logo

The Expo Milano 2015 has ended yesterday, 31^st of October, after 6 months of marvelous exhibitions and innovative events. The very successful exposition’s sparked the interest of 21 million visitors (of which one third international) with its architecturally harmonious and intriguing pavilions, each displaying the culture and products of a different country.

Even though not many might not be familiar with the event, the exposition was a World Expo organized in Milan with the International Expositions Bureau  and focused on one main theme: “Feeding the Planet. Energy for life”. Its aim was to bring awareness to defeat undernutrition and malnutrition through more sustainable political choices and better technology to “balance between the availability and the consumption of resources”[1].

The company in charge of the Exposition itself was a perfect example of sustainability. For instance, separate collection of waste reached up to 70 % of the total, and carbon dioxide emissions were relatively low thanks to the use of ecological technologies, such as on-site electrical cars and efficient construction materials. Moreover, in order to reduce waste and foster a positive social impact, many of the pavilions will have a second life. Monaco’s pavilion, for example, will be dismantled and sent to Burkina Faso to become the Red Cross operating headquarters.

Expo Milan 2015 was a clear example of how sustainability is gradually becoming one of the key aspects of a company’s success. In particular, the choice of the consumer is not limited any more to the value of the service or product provided; it now integrates the firm’s impact on society and the environment.

The Tree of Life and the Italian Pavilion at the Expo Milano 2015

Credits

“Six-month Milan Expo Concludes, Attracts over 21 Million Visitors.” Milanozone. Emirates News Agency, 01 Nov. 2015. Web. 01 Nov. 2015.

“Feeding the Planet, Energy for Life.” Expo Milano 2015. Bureau International Des Expositions, n.d. Web. 1 Nov. 2015. <http://www.expo2015.org/en/learn-more/the-theme>.

“Pavillon Monaco.” Pavillon Monaco Expo Milano 2015. Pavillon Monaco Expo Milano 2015, n.d. Web. 1 Nov. 2015. <http://monacopavilion.com/pavillon/project-and-philosophy/>.

[1] “Feeding the Planet, Energy for Life.” Expo Milano 2015. Bureau International Des Expositions, n.d. Web. 1 Nov. 2015. <http://www.expo2015.org/en/learn-more/the-theme>.

“The Expo Milano 2015 Sustainability Report.” Expo Milano 2015. Expo 2015 S.p.A., n.d. Web. 1 Nov. 2015. <http://www.expo2015.org/en/sustainability-report->.

Market research is a powerful decision-making tool. It brought world famous companies to success, however, when carried out in the wrong way, it leads to disruptive results.

Odeo, later rebranded Twitter, a podcast website competing with iTunes, was revolutionized by successful market research to a status-sharing platform. The company recognized what consumers visualized as the flaws of other existing social media websites, such as the overwhelming interface, and improved on them, developing a simple, consumer-friendly outlook. Instagram incurred similar early changes thanks to effective market researching. As the company’s CEO and co-funder reported, the business met consumers’ desires realizing that its original web app, Burbn, offered too many features, which made the app excessively complicated

In spite of the two previous example, many companies, notably Segway, completely failed to reach consumer’s needs. The company raised public expectations before its launch in 2002, describing the machine as extremely revolutionary. However, the idea of “revolutionary” did not match what the public was expecting. The 10,000 units per week goal was not met, selling 24,000 machines during the first five years of production.

Whereas Twitter and Instagram grew successfully through an effective analysis of people’s needs, Segway’s failed to reach the consumer’s needs, solve buyer’s problems or even target a specific segment. Clever inventions with a worthless market research do not always find a spot in consumers’ mind.

Credits

Sloane, Paul. “A Lesson in Innovation – Why Did the Segway Fail? | Innovation Management.” Innovation Management. InnovationManagement.se, 02 May 2012. Web. 18 Oct. 2015.

Schneider, Johan. “Why Most Product Launches Fail.” Harvard Business Review. Harvard Business School Publishing, 01 Apr. 2011. Web. 18 Oct. 2015.

Systrom, Kevin. “What Is the Genesis of Instagram?FAQ.” The Genesis of Instagram. Quora, 11 Jan. 2011. Web. 18 Oct. 2015.

Nazar, Jason. “14 Famous Business Pivots.” Forbes. Forbes Magazine, 8 Oct. 2013. Web. 18 Oct. 2015.

Most of the companies I have been writing about grew harsh competition within their own segment. Nevertheless, Microsoft has now developed a different strategy.

At the end of July, Microsoft released Windows 10 software, which is already running on many types of devices and available as a free update. Based on personal experience, the software drastically improved in respect to the unfriendly Windows 8 operating system.

The software comes with a new app, Phone Companion, which offers a new way to connect Windows 10 to other devices. The computer program delivers increased interaction between the software and various competitive portable platforms such  as Apple and Android tablets and smartphones.

Through collaboration with competitors’ app stores, Microsoft has developed a new way to promote its products. Moreover, Phone Companion displays many useful products, especially One Drive and Office, which provide a practical way to access and upload documents directly from smartphones or tablets.

A better strategy corresponds to better product positioning. Instead of a meaningless battle to develop a complete smartphone platform, Microsoft has finally decided to aim for a different goal, producing a user-friendly PC operating system that enables enriched connection with external devices.

Credits

Weinberger, Matt. “Microsoft CEO Satya Nadella’s Genius Plan: To Swap One Monopoly for Another.” Yahoo Finance. Yahoo, 29 Aug. 2015. Web. 11 Oct. 2015.

Warren, Tom. “Windows 10’s Phone Companion Aims to Link a PC to Any Smartphone.” The Verge. Vox Media, 26 May 2015. Web. 11 Oct. 2015.

Wingfield, Nick. “Windows 10 Signifies Microsoft’s Shift in Strategy.” The New York Times. The New York Times Company, 19 July 2015. Web. 11 Oct. 2015.

I bought my first GoPro camera in 2012. Before the purchase, I watched hours of spectacular footage of GoPro athletes engaging in reckless activities. For some reason, I tough the camera would have brought me to experience and film the same amazing adventures.

As I witnessed myself, the company managed to make the brand a status symbol. It is impressive how most of the people who are willing to buy the camera want to identify with the GoPro motto “Be a hero”.

The successful value proposition comes with an effective marketing strategy that not many brands managed to implement. In this perspective, the remarkable number of customers’ videos on You Tube is the main source of the brand’s promotion. Throughout the first quarter of 2014, people watched over 50 million hours of videos with the GoPro brand name involved.

In order to advertise its products even more, GoPro is also in the process of becoming a media company. Moreover, the brand is still looking for new ways to bring a well-rounded experience and has been planning to introduce a new cloud service.

By selling a lifestyle and not just a hardware, GoPro developed a brand that has a clear differentiation strategy within the competitive camera business. If the company successfully evolves into a media company and introduces a useful cloud service, than its popularity might persist.

Credits

Lapowsky, Issie. “Why GoPro’s Success Isn’t Really About the Cameras.” Wired.com. Conde Nast Digital, 26 June 2014. Web. 04 Oct. 2015.

Burns, Matt. “Inside GoPro’s Ambitious Plan To Connect Their Cameras To The Cloud.” TechCrunch. WorldPress.com VIP, 9 June 2015. Web. 04 Oct. 2015.

Seward, Zachary M. “What GoPro Means When It Calls Itself a Media Company.” Quartz. N.p., 19 May 2014. Web. 05 Oct. 2015.

The first time I heard about Tata Nano was in my second COMM101 lecture. At first I was really astonished to hear the car’s cost: only 100,000 rupees (about $2,200). It seemed like an optimal solution for the Indian market, where 21.9 % of the population lives below the poverty line and many travel on extremely precarious scooters.

The goal was to sell 20,000 cars a month; in November 2010 however, it sold around 509 units. The head of Tata Motors itself reported in 2010 that the Tata Nano business model had to be reinvented.

As Lee Yohn reports on Business Insider, the main reason for this flop is the wrong approach to the customer. Since the company has focused more on the low price than the practicality of the city car, the low-end and slightly higher-end customers had a low interest in purchasing the product, a clear symbol of poverty.

In May 2015, Tata Motors slightly changed its offer proposition, with a new, appealing model, the Nano GenX. It seems the company has learned from its mistakes, as the new model now offers many optional features and has managed to change the customers’ perception of the car from affordable to stylish and practical.

Even though Tata Nano was supposed to revolutionize transportation in India, it missed an essential step: understanding what the customer really needed. Finger crossed for GenX.

Credits

Yohn, Denise Lee. “What Went Wrong with Tata Motors Nano.” Business Insider. Business Insider, Inc, 22 May 2013. Web. 04 Oct. 2015.

“Stuck in Low Gear.” The Economist. The Economist Newspaper, 20 Aug. 2011. Web. 04 Oct. 2015.

Baggonkar, Swaraj. “Has the Tide Turned for Tata Motors?” Business Standard. N.p., 17 June 2015. Web. 04 Oct. 2015.

“Rural Poverty Portal.” Rural Poverty Portal. N.p., n.d. Web. 04 Oct. 2015. <http://www.ruralpovertyportal.org/country/statistics/tags/india>.

Chipotle Mexican Grill and Five Guys have something in common: they both provide a customized value proposition to the customer. This characteristic is bringing significant competition to McDonald’s way of doing business, especially in the US, where the two restaurants obtained most of their
success.

On this perspective,
McDonald’s Canada has promised to introduce a new way of ordering food in its Canadian restaurants by 2017. The ordering process will be very similar to the one employed in some fast food chains, where the buyer decides the main ingredients of his dish at a self-service kiosk. The company is also seeking to improve customer service with table delivery and kiosk support staff.

The way McDonald’s is rethinking about its policy tights up to one of the major current trends to deliver extremely customized goods. On this respect, Ryan Kamimura’s blog post on Tesla Motors’ direct business model clearly conveys how a tailored customer offer can lead to success, especially when it sparks durable customer loyalty. McDonald’s does not have a direct selling policy, however, thanks to a customizable offer, it might get closer and closer to customers’ needs.

The new program will cost 200.000 for each of the 1400 stores in Canada. Who knows, it might be worth it.

 Credits

Henderson, Peter. “McDonald’s Canada Promises Burger with Choice by 2017.” CBCnews. CBC/Radio Canada, 30 Sept. 2015. Web. 01 Oct. 2015.

Kopun, Francine. “McDonald’s Canada Introduces Self-serve Ordering.”Thestar.com. N.p., 30 Sept. 2015. Web. 01 Oct. 2015.

 Kamimura, Ryan. “Why Teslas Aren’t Only Attractive in Science.” Ryan Kamimuras Blog. N.p., 24 Sept. 2015. Web. 01 Oct. 2015.

IStockPhoto. McDonald’s. Digital image. Pubblic Radio International. N.p., 18 Sept. 2013. Web. 1 Oct. 2015.

Starting from the 21st of March 2013 the United Nation Commission of Inquiry on Human Rights in DPRK has  investigated  the unforgivable violations of the totalitarian regime in the North Korean country.

Thanks to the confessions of the numerous North Koreans refugees, a detailed report  was released at 25th session of the Human Rights Council in Geneva, the 17th of March 2014. More than 320 testimonies have contributed to make the details more vivid than any expectations. Many of the depositions involve torture, abuse and famine, especially in prison camps, which some aspects resemble the sadly famous concentration camps during the Second World War.

In order to take action against Kim Jong-un’s dictatorship, every country member of the UN Security Council has to give full consent. Unfortunately, China is not giving its support on submitting the human rights charges to the International Court of Justice.

It seems the whole world has fallen into the unethical jaws of indifference and selfishness. Even though many countries shouted “Never Again” after what the Nazi had done during the beginning of the century, it seems hypocrisy has taken over. Especially in front of such clear evidence, it is hard to believe how certain countries, notably China, have decided to refuse to collaborate against such harsh violation of the human rights.

More than one year has passed since the launch of the UN report on the North Korean country. However, no one seems taking action against the regime, nor pressuring the Chinese for consent. Unfortunately, the leading nations might be afraid of a possible collapse of the country, which would bring to many side effects, negatively influencing the neighboring nations.

Millions of people suffering in North Korea are shouting for help. What is the world’s priority: justice or international tranquility?

Credits

Park, Madison. “North Korea: ‘We Were Forced to Eat Grass and Soil’ – CNN.com.” CNN. Cable News Network, 17 Feb. 2017. Web. 05 Oct. 2015.

Pearson, Michael. “‘Abundant Evidence’ of Crimes against Humanity in N. Korea, Panel Says – CNN.com.” CNN. Cable News Network, 18 Feb. 2014. Web. 05 Oct. 2015.

“Report of the Commission of Inquiry on Human Rights in the Democratic People’s Republic of Korea.” Report of the Commission of Inquiry on HR in the Democratic People S Republic of Korea. UN, n.d. Web. 17 Sept. 2015.

Human Rights Violations in North Korea. N.d. THE DIPLO CABLE. Web. 17 Sept. 2015. <https://thediplocable.files.wordpress.com/2013/03/korea-refugees.png>.