A man carries a Starbucks logo sign after a corporate event at a hotel in Shanghai April 19, 2012. CREDIT: REUTERS/CARLOS BARRIA

In Qiushan’s blog about Starbucks overpricing in China, she talks how this phenomenon is being criticized in China. Starbucks, being the world’s leading coffee chain, CCTV (China Central Television) stated after comparing coffee pricing around the world, they found out the pricing in China is higher than other market price. For example, Starbucks sells a medium sized latte in China for one third more than the ones in other countries. It soon drew criticism from the public, consumers felt they are treated unfairly and the coffees are way overpricing. While some of the customers still have an optimistic view, “even the price is higher, but its still affordable”, other consumers think that due to the massive market in China, even the price is slightly higher, Starbucks will still obtain its market demand.

From my point of view, value proposition is the key to generate profits and keep the existing customer base. However, Starbucks is not doing what consumers have expected, they should immediately take action in price adjustment and reconsider their value proposition.

Organizational Culture is the value, beliefs and the working environment provided by employer to the employees, as well as the spirit behind its brand. We can think of some examples of company that has a family-like atmosphere such as Google Inc., Facebook and Zappos. I entirely agree with the idea expressed by Rupert Soames, chief executive of energy supplier Aggreko, “It’s usually top-down; If the boss is good, a company is good. If the boss is bad, the company is bad.” Employers certainly play the leading role; employees would mimicking what the employers do, and become more loyal, passionate and hardworking. “I tell my people if you don’t love this company, if you don’t love what you do, don’t stay.” Allan Zeman, a Hong Kong-based entrepreneur states. Just as what Zappos is doing, they offer employees with $2000 to quit the job. “Our corporate culture is our brand”, this cash acquisition offer has left the company with employees that are all enthusiastic and loyal to the company and its brand.

Work cites:

http://www.bbc.co.uk/news/business-23169441

After reading Mariska’s blog about Singles’ Day shopping spree, I felt very related. It’s not only that I have lived in China for the past decade, but I personally also participated in this spree. Singles across China used to spend November 11^th lamenting their single status, but now it turns out this unofficial holiday has become the largest online shopping event in China. On November 11th, all the shopaholics get excited and ready for the once-a-year grand sale. Most of the products were at least 50 to 80% off whereas in fact, some still in its regular price. During that day, Tmall.com and Taobao.com has together set a new record daily revenue of over 35.19 billion in Chinese currency which equals to approximately $5.75 billion. The record created surpass about 2.5 times the total revenue for American retailers during last Cyber Monday. Global firms also joined the part of the spree Nike, Adidas, Procter & Gamble, Unilever and Samsung Electronics conducted Singles’ Day promotions, many of them using Tmall. “Online is giving them a much more effective way of reaching these consumers,” said Bryan Wang, an analyst at Forrester. This shopping spree has reflected that e-commerce is growing rapidly in China, and some of them started to target on the next coming spree, “Double 12”.

“From replacement kidneys to guns, cars, prosthetics and works of art, 3D printing is predicted to transform our lives in the coming decades as dramatically as the Internet did before it.”

The rapid development of new technology had entirely changed our world. The launching of 3-D printing is a great example of newly developed technology, which still appears to have traces of futurism in some way. Since the 3D printing technique has been invented, many different products have launched. From shoes to arms (guns), it has successfully become the eye-catching phenomenon and attracted lots of publicity. It is undeniable that Internet has dramatically changed our life over the past decade, and it’s continuing. Will the influence of 3D printing goes beyond Internet? It is still doubtful whether we could afford it just like the generalization of Internet? It seems now almost everything can be made out of 3D printer, cars, jewellery, prosthetic and etc. In the meanwhile, as more and more product can be made using 3D printing technique, that means many job opportunities will be replaced by it. In the future decades, it will be unimaginable how popular it will become and how our ever day life will change.

Work cites:

http://www.newvision.co.ug/news/649520-3d-printing-will-change-the-world.html

After the yoga-wear giant faced a sheer pants controversy, the pants are now transformed into “Second Chance Pant” with an extra layer. The tag attached on the pants reads, “These pants were inspired by a need to find functional and beautiful design solutions for our sheer pants. This is what celebrating failure looks like!” The pants is selling at the retail for $92, a slightly less than the sheer ones. From what I perceive, as the sheer pants represents a large portion of Lululemon’s inventory and the decrease of company’ s stock; “Second Chance Pant” is to help clean up the overstock. Ironically, Lululemon seems did not seize the “second chance” well, it still fielding some complaints that the “Second Chance Pant” is still too sheer. Surprisingly, the founder of Lululemon, Chip Wilson provided a reason for the sheerness, “quite frankly some women’s bodies just actually don’t work” for the company’s pants. The company apparently did not meet the expectation of consumers and Chip Wilson’s apology is considered as the “worst apology”.

Work cites:

http://www.huffingtonpost.ca/2013/11/13/lululemon-second-chance-pant_n_4267342.html

Lululemon Chairmen, Chip Wilson’s Apology Called Worst Ever

Snapchat, an unprofitable social media company allows users to send instant pictures and text. What makes Snapchat unique from other existing social media is that they value users’ privacy. Unlike Facebook or Twitter that keeps tracks of user behaviour, and then sell ads based on the detailed knowledge of user preference. However, it is both their strength and weakness by not having track of user behaviour. Since most of the unprofitable social media Apps generate profit from ads, and most of the efficient ads are targeted on users’ preference. Thus, Snapchat could face a hard time making money by selling same ads to all users instead of targeted ads.

Snapchat has recently turned down an all-cash acquisition offer from Facebook Inc. for at least $3 billion. Based on the mass amount of user base and the popularity of Snapchat, maybe these young and intelligent founders have made the right decision. We could not predict if Snapchat would be as lucky as Facebook, which now worth about 118 times what Yahoo has offered in 2006. Snapchat is now focusing on “building their business and maintaining their independence”, and make $3 billion bet on themselves.

Work cites:

http://www.bloomberg.com/news/2013-11-13/snapchat-s-founders-make-3-billion-bet-on-themselves.html

A new product from Burger King “Satisfries” — the healthier substitution for regular French Fries. According to what Maureen Storey, president and CEO of the Alliance for Potato Research & Education, “per capita consumption [of potato] has declined over the years, prompting efforts to make [fries] healthier and easier to market. But “it’s actually not an easy thing to do to because consumers want the same taste and the same texture.” Nowadays, consumers are more concerned about their health issues such as obesity. They wanted to eat a hamburger that has no steroids and hormones in it. Burger King strategically grasp what consumer wants, the “Satisfries” has 40% less fat, 30% less calories than McDonald’s while not compromising its taste. Burger King North America president Alex Macedo has indicated that people are not willing to change their routine of eating what they used to eat, so definitely a new product such as veggie burger won’t be as good as “Satisfries”. Not surprisingly, Burger King’s stock market had some “fat returns” with “skinny fries”, the shares increased for 18% in 2013 so far. Value proposition and the customer segmentation have placed a significant impact on the success of Burger King, and gaining a “fat returns” for the company.

Source:

http://www.bnn.ca/News/2013/10/4/Burger-King-tries-to-fatten-margins-with-skinny-fries.aspx

http://www.miamiherald.com/2013/10/07/3676111/bks-new-fries-fail-to-satisfy.html

We have discussed that “if customers want more leg room and space, why do airlines not exclusively fly large aircraft?” in our earlier class. WestJet is now providing customer larger aircraft with more legroom, simultaneously with the rising of price. However, the recent news and customer’s complaints have reflected that this may not be a good choice.

WestJet has admitted, “it had a greater proportion of empty seats on its flights last month as increases in the airline’s capacity outpaced its growth in passengers”. WestJet has purchased 65 Boeing 737 MAX aircraft last month, which shows that WestJet is changing its marketing strategy. In this transitional period, WestJet is increasing their output because the larger the aircraft, the higher it costs for maintenance and fuel. Hence, they will definitely charge customers more. It might turns out that they will lose some consumers, as cost performance was one of the dominant factors that made them so successful. The Toronto Stock Exchange has indicated, “WestJet’s shares lost 35 cents at $25.70 in Thursday morning trading”. From my point of view, WestJet should do a much further marketing forecast. Moreover, the customer’s negative feedback has reflected that they did not have a good value proposition of satisfying what customer’s really wants.

Source:

http://www.ctvnews.ca/business/westjet-s-increase-in-capacity-outpaced-passenger-growth-in-september-1.1481764

Silk Road, a black-market website dealt with online drug trading were seized and its owner Ross William Ulbricht was arrested by FBI this week. All the illegal transactions were paid through Bitcoin, a virtual currency used to trade illicit products anonymously. The disclosure of Silk Road had a steep fall of roughly 20% for the value of Bitcoin. “But others argued that Silk Road’s closure would actually be good for the currency”, because the government’s suppression of Bitcoin will lead to a termination. Over the past years, the amount of Bitcoin in circulation has a total value about $1.2 billion in USD, and the site was making a profit of 80 million through the transactions. Nevertheless, we may ask will the demise of Silk Road become the collapse of black-market or it is “seemed to heat up” other trade market. The latter are tend to be more likely, a competitor Atlantis is now “aimed at eating away at Silk Road’s market share”. Personally, I think it is still a hardly controllable situation for the government, but things will eventually bring to justice.

Cites:

http://business.time.com/2013/10/04/online-drug-markets-are-alive-and-thriving/

http://www.bbc.co.uk/news/technology-24371894

Video:

https://www.youtube.com/watch?v=optdfUhQIG8

“We care about every worker in our worldwide supply chain. Any suggestion that we don’t care is patently false and offensive to us.”

— CEO Tim Cook in 2012

        Apple was denounced numbers of labor violations during the past years as its products become popular in the world. Just yesterday, Apple announced its latest products – iPhone 5S and iPhone 5C, but once again, Apple and its supplier Jabil Circuit are involved in this rumour. Jabil Circuit’s factory in Wuxi, China was accused with “hiring discrimination, overcrowding, poor training, mandatory overtime…” According to what Apple’s CEO Tim Cook said last year, the rumour spread out lately is inconsistent with what Apple’s Code of Conduct indicated and what Tim Cook said.

Apparently the workers were defending for their rights, even many of them claimed that overtimes were unpaid. The Jabil is certainly doing this violation for the sake of their benefits and profits. Workers in the Jabil forgo their break time in order to fulfill the tasks and increase the productivity. Or we can say, their overtime probably had some contributions on shifting iPhones release date earlier. It is definitely an exciting news for iPhone fans, but how many people would really concern about the “behind the scene”?

http://allthingsd.com/20130905/apple-investigating-worker-abuse-charges-at-iphone-c-supplier/