This marketing project video has been a very interesting experience that has tested a lot of my project management skills. I would say that the movie project was a strenuous task but it has provided us with a rich learning experience. Many steps had to be considered from planning, actual filming, and editing. There were numerous times where a lot of parts have to be re-edited again and again.

One of the important things I have learnt about from this project is that the plans we imagine of could be very different from the reality. This was especially true during the planning and filming phase. I noticed that we had a lot of great ideas that we thought would have been a great addition to the film. However, there were many instances where these scenes simply could not be acted out in reality, or it didn’t turn out to be as great as envisioned. For example, there were many segments in our video that we used the airport as the background, but the quality of the video and it’s meaning didn’t turn to out to be as desired. We ended up using a lot of video clips and supporting animations instead to substitute these parts. I think this difference in perception goes on to more aspects of marketing and maybe even life also.

I believe that there are some marketers out there that are over-confident of their product offerings or do not think of others in their ad process. They may think of brilliant ideas, but these ideas may not be answering the consumer needs or they come out as a totally different message to the audience. Hence, we should always be conscious of what others comment about your work and be open to change, as we may be indulged into a world that doesn’t actually exist and be out of tune with the times.

It has always been well known to marketers that pricing goods at 99 cents is a great tool in psychology pricing to boost sales of products on the shelf. From local convenience stores to national products, we see products everywhere that cost $9.99, $99.99. The 99 cents are everywhere. The reason for this pricing is because consumers tend to judge a product’s price by looking at the left-most digit. If the product is sold at $99.99 instead of $100.00, there is a psychological effect where consumers tend to treat this product as being worth $90 instead of $100, although the difference is only by 1 cent. Previous studies have shown that this strategy of pricing actually works, and the benefits of increased sales from this type of pricing outweigh the costs of losing one cent per product.

However, it could be argued that times have changed and that consumer preferences may have changed too. Robert Schindler, a professor at the Rutgers School of Business-Camden has suggested that “when consumers care more about product quality than price, just-below pricing has been found to actually hurt retail sales.” This could be argued to be true, as consumers become more adept in understanding the psychological effects of 99 cent pricing. Moreover, the market has also changed from the marketing era in the 80s to a new environment where consumers demand greater services than just the product itself. Pricing may no longer be the utmost priority of consumers, with the preference of quality products playing a bigger role. For example, if I am going to invest on a new high quality sedan like a BMW or Mercedes, I do not expect these automotive manufacturers to use this type of pricing. I purchase their motor vehicles because of their high quality and performance. If they use such psychological pricing, I would regard the manufacturers as a lower quality brand and it would negatively affect my desire to purchase cars from this brand.

Moreover, as governments around the world are finding the penny to be too expensive to produce and are abolishing the penny altogether in their currency systems, products are being rounded to the closest five cent intervals. Consumers now know that they don’t even save a penny from purchasing the product as the price is rounded. This would be a further setback to such psychological pricing as there are no more actual benefits to the pricing anymore, only the psychological effect left. I believe that in the future it is questionable if such psychological pricing will be effective anymore. Will the 99 cents strategy continue to prosper in this new era or will there be an all new marketing strategy to replace it altogether?

Article on Professor Robert Schindler’s Study on 99-Cent Pricing 

In the market, we often see numerous products that are very similar but with different brand names and hence different prices. A bottle of wine may typically cost $20, but with a brand name of Alfa Romeo on it, the wine now costs $70. A worthless ice scraper costs $50 with Saab’s name written on it.

So why are products with brand names written on it priced so high? Why is there a market for these branded products when other company offerings could offer exactly the same function? I believe that the key is branding of the company.

Other than being a decision heuristic for consumers, I believe that the most important point is that a good brand helps consumer convey their status and prestige compared to others. Brands names are one of the best ways to show a person’s personality qualitatively. A man that wears a suit made by Giorgio Armani, leather shoes made by Lloyd, and drives an Aston Martin super car has the symbol of wealth and extravagant tastes. Whereas another man with a casual dress shirt, and drives an estate car shows that they are low profile and very practical to their daily demands.

In the market, I believe it could be argued that there are different consumer types and that companies have to choose between what type of consumers to target. However, I believe that companies that opt to go for the route of providing a prestige brand are much better off. Companies like Apple, Lamborghini, Burberry are prestigious brands that are actively sought for by consumers and they don’t need to worry about the lack of market share. They also have a much higher leverage with pricing and the design of their offerings, as they are leaders in their market. Therefore, I believe that since consumers heavily view brand names as the key for the identity, companies should try to establish their brands to help better promote and improve the consumer’s identity. Of course, this involves a lot of resources to build up a brand as a prestigious product, but in the long run companies successful in doing so would have a greater chance of becoming a multi-million dollar organization.

Article on the Role of Brand Names in Our Consumer Driven Society

Many social networking sites today have all had their fair share of issues with information privacy, from LinkedIn, Twitter, and most notably Facebook. In the online business, consumer data is extremely important, and marketing teams would strongly desire to obtain and analyze these consumer databases to understand their trends and develop goods and service that correctly target these people. It would be a dream for a marketing firm to have access to all of the information for over 1 billion Facebook users at their disposal. Having such a database would also deem very valuable for these social networking sites.

One example would be the Facebook beacon program, that would track certain activities of Facebook users on participating websites, and then report those activities to the user’s Facebook friends as means of increasing brand awareness. There have been incidents of users that have logged off and have not given consent but their activities are still notified to their friends. This has been a breach in privacy, as users whether logged off or not are being tracked while on other websites. Eventually, settlements have been made for this privacy incident and the program ultimately abandoned. However this has left a mark for Facebook users to always be careful of what Facebook posts on your behalf. This case occurred during November 2007, years before Facebook’s first IPO. Now with the company going public, it is even more obliged to make more money from it’s client database as much as possible. It is questionable if there would be another beacon program from the relentless pressure of making money and ultimately would users of the networking site give up on Facebook?

I agree with Cindy Leung’s post about what social networking companies should think about in their corporate strategies. There are privacy laws that protect the human rights of users that use these social services. Sites like Facebook that are now enlisted on the stock exchange are even more pressured now to release and sell the data of their users to earn as much revenue as possible to please shareholders. With constant changes in their privacy policies and functions, in the short run a company may be able to earn some short term profit from newly fetched data that they may legally obtain, but they should understand that consumers will find these leaks. Instead, companies should look at aiming for long term sustainability and being socially responsible to maintain their consumer base for the long run so they can earn a steady stream of profit and not a short term spike.

2007 Facebook Beacon Article on PCWorld 

Apple is one of the leading tech. companies in the world that delivers millions of consumer electronics to customers every year, varying from the iPod Nano, iPhone, iPad to the iMacs. Millions of users eagerly await every year for new product releases that the Cupertino company reveals behind closed curtains. Behind all of these products is the famous designer Sir Jonathan Ive. He has been credited as one of the most influential Britons outside the UK, and is well known and appreciated for his product designs that have become so popular.

On John Webb’s blog of innovation excellence, he comments on the 10 Success Principles of Jonathan Ive. I agree with John’s statement that success comes from Ive allowing Apple products speak for themselves.

Looking at the numerous product offerings that Apple offers, we can see that these products are definitely based on customer orientation. These products are based on what provides the most value to the consumers, and are not necessarily charged at the cheapest price possible. There may be considered a premium just to be able to use Apple products also.

One of the best examples would be the unibody Macbook notebook lineups. Apple’s notebooks are charged at a higher price compared to competitor’s similar offerings. Yet many users opt to purchase Macs instead of PCs. Looking at Apple’s offering, we can see that the Macs provide a simplicity of use from a friendly operating system environment that differs from the competitors. The learning curve of using Macs are very simple and consumers may adapt easily. Many necessary software for the computer to operate are also already included, along with programs already installed to transfer data from the old computer, altogether easing the complications of purchasing a new notebook computer. On the hardware side, the design is simplistic with few knobs, indicators, and sensors around the computer. But the product still provides an elegant, premium, and sturdy feeling from its aluminum unibody design that lives up to Ive’s principles of simplistic design. It could be said that consumers that purchase Apple products must value benefits that cannot be quantified by money alone also, such as simplicity and elegance.

It should not be mistaken that Apple does not do any marketing for its products. In fact, one of the major strengths of Apple has are its marketing capabilities. However, we see that the marketing approach of Apple is not to establish itself as offering the cheapest alternative to consumers, but the company that provides the consumer with the highest quality products that tailor for customer needs. Using this approach, Apple has been generally favored by many consumer electronic users around the world and is one of the most highly regarded corporations around the world. I believe that Apple is the prime example that consumers look for value, whether or not it is explicit or implicit, and not just the cheapest alternative in terms of money. Consumers are willing to pay the premium and wait out for quality products with high value, they do not just follow the laws of the demand curve. Hence, marketing should be based on providing value for the customer, and not purely focusing on money, since we can see that greater success is possible from focusing on what values customers best.

Article of Jonathan Ive’s 10 Success Principles 

I have came upon an article that has become controversial in the housing markets of Hong Kong as the government plans to change it’s policy in managing the real estate industry.

For years, the value of apartments has been measured by calculating the gross floor area. If apartments are larger, they have a higher value, and so many property developers try to provide as much area as possible in order to earn more profit. But this has resulted in a poor efficiency rate of the property. For example, there may be long narrow corridors at the side of a room, which has little to no apparent use but to boost the gross floor area.

Starting from May, real estate agents will be required to use a new measurement for housing by indicating the saleable area. This aims to provide better transparency for potential buyers when choosing apartments, as they will be able to identify the actual amount of usable area in their potential purchase. There have been complaints however of existing property owners losing out from this new policy, as apartments regarded as 600ft would be reduced to just 400ft, and thus be deemed less valuable.

I believe that it is the right decision to implement the policy of using saleable area in the housing market, because property developers have unethically took advantage of vague area calculations to boost the value of their apartments. With this new policy, property developers may be encouraged to develop more efficient apartments that focus on saleable area, thus becoming more socially responsible and reputable.  Buyers also benefit, as they get more value for their money. In fact, should all housing across the world use saleable area as the standard of measurement to mitigate such misleading behaviour?

SCMP Hong Kong Article