Month: September 2014

Personal Blog #3: Will Lululemon Disappear in 2015?

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Will Lululemon Disappear in 2015?

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A U.S. financial news website predicts the Lululemon brand will ‘disappear’ in 2015.

According to a U.S. website, Lululemon has made 24/7 Wall St’s list of “10 brands that will disappear in 2015.” This surprising prediction was affected by the threatening affair in February 2014, and the radical comment made by its founder in November 2013. I deemed the misfortune would probably happen as these two events resulted in the declining sales and falling value propositions.

In February 2014, it was reported that customers were being banned from Lululemon for “reselling products over the internet.”² The customers felt “shocked”, “victimized” and “humiliated” after receiving the threatening call. As loyal buyers, they supported this company with large effort because they loved the yoga culture of Lululemon. However, this event would greatly decrease their loyalty to this brand and then turn to another company. In my perspective, this behavior of Lululemon was not sensible because it did not solve the problem essentially, but lost a large number of loyal customers instead. 

The company failed to present its value propositions before in November 2013 as well. During the interview with Bloomberg TV, Lululemon founder Chip Wilson said “recently-reported problems with pilling” were “not necessarily a quality issue”, and he blamed “some women’s bodies just don’t work for it.”³ As a yoga-inspired athletic appeal company, it was Lululemon’s responsibility to provide customers with comfortable yoga clothes. However, after receiving the problem of its material, Lululemon did not search for solutions to the problem in order to see if it “[got] the job done” first. Instead, the founder turned to complaint about customers’ body shapes and thus caused the failure in value propositions.

 

Endnotes:

1. “Lululemon, BlackBerry on List of Brands ‘that Will Disappear in 2015′” CTVNews. CTVNews.ca Staff, 10 July 2014. Web. 30 Sept. 2014. <http://www.ctvnews.ca/business/lululemon-blackberry-on-list-of-brands-that-will-disappear-in-2015-1.1908720>.

2. “Lululemon Apologizes after Threatening to Ban Customers for Reselling Products Online.” CTVNews. CTVNews.ca Staff, 16 Feb. 2014. Web. 30 Sept. 2014. <http://www.ctvnews.ca/business/lululemon-apologizes-after-threatening-to-ban-customers-for-reselling-products-online-1.1689588>.

3. “Lululemon Founder Blames Women’s Bodies for Pants Problems.” CTVNews. CTV British Columbia, 6 Nov. 2013. Web. 30 Sept. 2014. <http://bc.ctvnews.ca/lululemon-founder-blames-women-s-bodies-for-pants-problems-1.1531351>.

Picture reference:  

Retrieved from <http://www.ctvnews.ca/business/lululemon-blackberry-on-list-of-brands-that-will-disappear-in-2015-1.1908720>.

Article Reference:

“Lululemon Apologizes after Threatening to Ban Customers for Reselling Products Online.” CTVNews. CTVNews.ca Staff, 16 Feb. 2014. Web. 30 Sept. 2014. <http://www.ctvnews.ca/business/lululemon-apologizes-after-threatening-to-ban-customers-for-reselling-products-online-1.1689588>.

“Lululemon, BlackBerry on List of Brands ‘that Will Disappear in 2015′” CTVNews. CTVNews.ca Staff, 10 July 2014. Web. 30 Sept. 2014. <http://www.ctvnews.ca/business/lululemon-blackberry-on-list-of-brands-that-will-disappear-in-2015-1.1908720>.

“Lululemon Founder Blames Women’s Bodies for Pants Problems.” CTVNews. CTV British Columbia, 6 Nov. 2013. Web. 30 Sept. 2014. <http://bc.ctvnews.ca/lululemon-founder-blames-women-s-bodies-for-pants-problems-1.1531351>.

Osterwalder, Alexander, and Yves Pigneur. “The Business Model Canvas.” Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers. Hoboken, NJ: Wiley, 2010. Print.

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Personal Blog #2: Tesla in China

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Tesla in China

Tesla in China

Tesla started selling from March in 2014

As a leader in emerging electric car market, Tesla has already taken a place in the Western auto field. In China, by contrast, its selling rate was stuck, caused by the complicated car delivery process and a brand-name dispute. However, I believe Tesla will have a greater share in Chinese market if it enhances its strength in differentiation, and seizes the opportunity of increasing support from the Chinese government.

Due to Tesla’s relatively high pricing and differentiation-focused strategy, it is “considered by the Chinese to be a brand that rivals other automakers like BMW and Mercedes.”¹ The affluent in China, especially those who are pursuing better environmental standards, are willing to pay a high price for a unique and state-of-art automobile that can help to identify their status and attitudes towards life. And it turns out that Tesla perfectly fits their demand.

Since the economic revolution in China, China has been “the world’s largest auto market.”² With its awful smog problems, the demand of electronic cars and the awareness of improving environmental standards have increased. In July, “China’s State Council agreed to exempt electric cars from the 10 percent tax normally assessed on new auto.”³ Being one of the most successful electric auto companies, Tesla will definitely take the advantage of this action to further penetrate into the Chinese auto field that is occupied by mostly gasoline automobiles currently.

Despite the fact that Tesla is undergoing a slow development in China now, the strength it owns in differentiation and the support it gains from the Chinese government will provide Tesla with a brighter prospective.

 

Endnote:

1. Michael, Yoshikami. “Why Tesla Will Win in China.” CNBC. Michael Yoshikami, 1 May 2014. Web. 27 Sept. 2014. <http://www.cnbc.com/id/101634065#.>.

2. Einhorn, Bruce. “Tesla in China: Slow Sales Acceleration and a Brand-Name Dispute.”Bloomberg Business Week. Bloomberg, 7 Aug. 2014. Web. 27 Sept. 2014.<http://www.businessweek.com/articles/2014-08-07/tesla-in-china-starting-sales-slowly-winning-brand-name-dispute>.

3. Refer to endnote 1.

Picture reference:  

Retrieved from <http://stocksmarket.in/146552/2014/02/19/will-teslas-bet-on-china-pay-off/>.

Article Reference:

Einhorn, Bruce. “Tesla in China: Slow Sales Acceleration and a Brand-Name Dispute.”Bloomberg Business Week. Bloomberg, 7 Aug. 2014. Web. 27 Sept. 2014. <http://www.businessweek.com/articles/2014-08-07/tesla-in-china-starting-sales-slowly-winning-brand-name-dispute>.

Michael, Yoshikami. “Why Tesla Will Win in China.” CNBC. Michael Yoshikami, 1 May 2014. Web. 27 Sept. 2014. <http://www.cnbc.com/id/101634065#.>.

“Porter’s Generic Strategies.” Porter’s Generic Strategies. Web. 27 Sept. 2014. <http://www.quickmba.com/strategy/generic.shtml>.

“SWOT Analysis.” SWOT Analysis. Web. 27 Sept. 2014 <http://www.quickmba.com/strategy/swot/>.

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Personal Blog #1: A Business News Story with Business Ethics

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Ethics of Unpaid Internships

will work for free

Considering of ethics, the phenomenon of not paying interns with salary has become an issue. According to the Economist Newspaper, companies that “fail to pay are in growing danger of being taken to court.”¹ With the increasing awareness of personal right, the former unpaid interns now demand the companies pay their intern salary back. Nevertheless, in my own perspective, I tend to disagree with defining unpaid internships as illegal.

When an intern gets an internship offer from the company, it is clearly stated on the offer that the internship is unpaid. The offer will not go into effect unless the intern consents. Based on Milton Friedman’s concept —- companies that “engage in open and free competition without deception or fraud”² are defined as being social responsible, because the interns know they will not be paid in advance, and the companies do not force them to accept the offer, the unpaid internships should not be deemed as illegal.

Additionally, as the internships provide interns with experience and further development of their studies, the essence of internships is rather like practical lectures. Internships will shape intern’s future, and help them identify their values. However, during this process, the interns are far less effective than the regular employees, and they may even make huge mistakes that can affect the company negatively. It is not exaggerated to say that the interns are lucky for not having to pay the internships. As a result, it is not an ethical action for the interns who previously gained experience from the firms to take their “teachers” to the court.

Endnotes:

1. T.W. “Are Unpaid Internships Illegal?” The Economist. The Economist Newspaper, 9 Sept. 2014. Web. 10 Sept. 2014. <http://www.economist.com/blogs/economist-explains/2014/09/economist-explains-7>.

2. Zimmerli, Walther Ch. “The Social Responsibility of Business Is to Increase Its Profits.”Corporate Ethics and Corporate Governance. Berlin: Springer, 2007. Print.

Picture reference:  

Retrieved from <http://www.pikaland.com/2013/01/07/i-work-for-free-sometimes/>.

Article Reference:

T.W. “Are Unpaid Internships Illegal?” The Economist. The Economist Newspaper, 9 Sept. 2014. Web. 10 Sept. 2014. <http://www.economist.com/blogs/economist-explains/2014/09/economist-explains-7>.

Zimmerli, Walther Ch. “The Social Responsibility of Business Is to Increase Its Profits.”Corporate Ethics and Corporate Governance. Berlin: Springer, 2007. Print.


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