Responding to Nicola Lam’s blogpost (1) about the controversial GM advert, I do not concur with her concluding that GM should subsequently put their focus on sustainability as a reaction on their latest advertisement desaster.

The reason for the extremely negative response (3) to this ad was its degrading nature, not the praisal of pollution. The target audience being college students, who often happen to ride a bike, it is understandable why they pose an attractive target to gain new customers. GM’s strategy to reach this goal, however, was far from diplomatic: If you ride a bike, women look down on you, you’re ashamed, “life sucks”. Many college students prefer a bike to a car because of health aspects or convenience because they already live on campus.

Getting around on campus is often far more convenient by bike than by car

Given these points, the marketing method that was applied here becomes disastrous and could harm the company’s already damaged image even more. Before taking provocative advertisement such as this into account, a business should gain clarity about its target audience. College students often rely on bikes because of convenience rather than monetary reasons – GM should have considered if their slogans would still appeal given these conditions in order to advertise their cars to students.

Sources:

1) https://blogs.ubc.ca/nicolalam/2011/11/14/cycling-hot-or-not/ ; Nicola Lam, 14th of November 2011

2) http://abcnews.go.com/blogs/business/2011/10/gm-backpedals-on-anti-cycling-ad/ ; Kevin Dolak, 13th of October 2011

3) http://www.gelatobaby.com/2011/10/12/gm-backpedals-on-anti-bike-ad/ ; Alissa Walker, 12th of October 2011

With the release of the Kindle Fire on the 15th of November (1), Amazon launched a device that, priced at only $199 dollars, could pose a serious threat towards Apple’s $500 iPad 2.

Some journalists already suggest that the availability of a cheap, well-marketed alternative to the iPad 2 could mean that Apple’s domination in the tablet market could come to an end very soon, as the Kindle Fire could spread Google’s Android operating system into the user’s minds just like it happened on the cell phone market.

Similar to Volkswagen's Beetle in postwar Germany, the Kindle Fire could become a solid, reliable tablet that everyone can afford.

A product that satisties expectations as high as this, however, does not only require good marketing and a cheaper price than its competitors – it also needs to please customers and thus increase its popularity, just like the expensive yet uber-popular iPad 2. On ZDnet, the introduction of an innovative product that becomes widely successful is referred to as the “Volkswagen moment” (3). The Fire, however, does seem to be rather competing with “its own kind” than with the iPad (4). Time will show if the ambitious try to copy the iPad’s success with less than half its price and features will be thanked by customers.

Sources:

1) http://www.chicagotribune.com/video/breaking/chi-new-kindle-fire-released-20111115,0,6237502.htmlstory ; Chicago Tribune, 15th of November 2011

2) http://www.theregister.co.uk/2011/11/22/kindle_sparks_then_splutters/ ; Matt Asay; 22nd of November 2011

3) http://www.zdnet.com/blog/perlow/amazons-kindle-fire-the-tablets-volkswagen-moment/19312 ; Jason Perlow, 17th of November 2011

4) http://www.reghardware.com/2011/11/21/changewave_research_shows_kindle_fire_demand_hits_ipad_rivals_not_ipad/ ; Tony Smith, 21st of November 2011

5) http://news.cnet.com/8301-17938_105-57329834-1/kindle-fire-getting-shoppers-hotter-than-ipad/ ; Erick Mack, 22nd of November 2011

The Euro crisis became more and more serious over the last couple of weeks and even the future viability of the Euro currency was questioned. It is evident that problems of this scale demand for someone taking a leadership role to provide stability and reassurance in the EU community.

The blogpost Europe’s big two analyses the importance of Germany’s councellor Angela Merkel and France’s Premier Nicolas Sarkozy’s cooperation. Not only is France Germany’s biggest business partner to date, the countries are also tied together by their long history including several wars. One of the interesting facts the article brings up is that Germany focusses more and more on Asia in terms of exports and therefore establishes an economic safety that other countries, including France, are lacking as of yet. This economic foresight, eliminating geographical restraints, could be one reason for Germany to be currently considered an idol in the stricken Eurozone.

A comparison of deficits in Europe - Germany being the clear winner

France, however, faces the threat of its high debt and low R&D expenses which influences economic sustainability, leading to an increasing identification of both economy and public with the alledged “losers” of the Eurozone such as Greece. According to the article, France has maintain its self-confidence to remain an equal partner for Germany and stabilize the European community.

Sources:

1) http://www.economist.com/comment/1129830 ; Professional Business blog on The Economist.com;  21st Nov. 2011

Thinking of entrepreneurs, Ingvar Kamprad is probably one of those that influences our student life the most. Not by taking up our time with the unfortunate invention of facebook or a particular smartphone that can play games, but by selling stylish and, more than anything else, cheap furniture and accessories for all ages.

Many customers became desperate over the assembly of IKEA products - not affecting the company's success

The first store was opened in 1953 and within a little more than 20 years, the franchise had opened branches all over the world, in Europe, America and Asia. (2) The entrepreneurial aspect of the company made this rapid expansion possible: Low product prices, unique design and high customer identification (i.e. recognizable product names) resulted in high differentiation and made IKEA more than just another substitute on the furniture market landscape. The risk of this undertaking, however, was high prior to the opening of the first store because it was hard to predict if post-war Sweden was ready for such an innovative approach, and if customers really want to self-assemble their furniture.

The company focusses on cost control and continuous development of their production methods to increase efficiency (1). It is reported that founder Ingvar Kamprad lives a very humble and down-to-earth lifestyle (3) and so does IKEA as a company, as in many other companies’ organizational aspects that were inspired by its founders’ characteristics.

Sources

1) http://www.thomaswhite.com/explore-the-world/global-players/ingvar-kamprad.aspx ; Thomas White.com; 20th of September 2011

2) http://www.newyorker.com/reporting/2011/10/03/111003fa_fact_collins ; Lauren Collins; 3rd of October 2011

3) http://www.swissinfo.ch/eng/Home/Archive/Cheap_is_good,_says_furniture_magnate.html?cid=650688 ; swissinfo.ch; 26th of March 2006

Solyndra, a manufacturer of thin-film solar cells, was founded in 2005 and recently declared bankrupty on the 31st of August.

Fig 1) 20% reduction of power cost due to absorbtion of sunlight from any angle as opposed to regular solar cells

The company’s exclusive technology (see Fig.1) was promising. In 2005, Solyndra managed to raise over 1 billion US$ in the first years after its foundation from a variety of investors – in addition, the US Department of Energy granted a loan of over 500 million US$ in 2009. The falling prices for silicon, a major part in the regular solar cell production, scooped Solyndra’s competitive advantage and made competition on the photovoltaic market very difficult.

Considering that Solyndra’s revenue for 2009 was only 10% of the raised investments (100 mio. US$), it’s hard to understand how the US government could invest almost half a billion of taxpayer money in an ill-fated company that has now finally declared bankruptcy. Innovative energy concepts have to be encouraged and supported, but they also have to be economically sustainable. Otherwise, investments in allegedly promising companies to support the public image of a “green thinking government” can lead to unexpected losses if the profitability of a company is not a crucial aspect of the decision.

Sources:

1) http://www.triplepundit.com/2011/09/solyndra-bankruptcy-economic-sustainable-business-lessons/ ; Jonathan Mariano, 02.09.2011

2) http://blogs.scientificamerican.com/plugged-in/2011/09/27/solyndra-illuminating-energy-funding-flaws/ ; Melissa C. Lott, 27.09.2011