Since it was founded, WestJet offered domestic flights at discounted prices. It was able to do so following its low-cost model by having only one model of plane with an all-economy class configuration to under-utilized airports, reducing its maintenance costs. In a recent Maclean’s blog, Chris Sorenson discusses Westjet’s plan to offer intercontinental flights from several Canadian cities to Dublin.

The success of WestJet can arguably be due to its low-cost model. By having only one type of plane and flying only domestic flight, WestJet was able to keep its costs low, therefore maximizing its profit. It’s decision to incorporate intercontinental flights to its value proposition is, in my opinion, a big mistake. WestJet’s current fleet of 737s is also questionable on whether or not it is able to act as a contender in these flights. Presently, these planes have a relatively low maximum capacity and small fuel tank. According to Porter’s generic strategies, a company should only have one strategy and should not try to move into a different one. Since WestJet is operating on a low-cost model, if it chooses it differentiate, it will face many challenges, most importantly rising cost levels.

There has been a lot of buzz with this new piece of technology known as “coin”. In Huiyin’s blog on a all-in-one credit card, she discusses this new prototype credit card produced by the coin team. I think that there is definitely a market for this new product as it offers such a unique value proposition of easiness and organization to our lives. In today’s fast-paced world, speed is key. The faster something can be done, the more we like it. Coin offers that value and gives us an ease of access to our money while keeping our wallets organized. I found their ad on youtube:
https://www.youtube.com/watch?v=w9Sx34swEG0

Coin works by changing its magnet strips so it can be used as different cards. However, in today’s world, magnet strips are becoming less and less popular. In Canada, magnet strips are only used under two conditions: either the chip is broken and cannot be used or there is no chip to begin with. The world is moving towards a payment system revolving around chips since they are much more secure. If Coin is able to address this problem, there is no doubt it will be successful.

It appears as though women are not impressed with recent comments made by Lululemon founder Chip Wilson. Wilson made comments to Bloomberg TV – saying that certain women’s bodies “just don’t actually work” for Lululemon’s yoga apparel. In an attempt to calm the storm of backlash he faced, Chip issued an apology. However, many decided that his attempt to make amends was just not good enough. An online petition has been started to get Chip Wilson to stop shaming women’s bodies and start making clothes for women of every shape and size.

In my opinion, Wilson has made a huge and incredibly stupid mistake. Lululemon is known around Vancouver and North America with a brand image that promotes a healthy lifestyle and celebrates women’s bodies. By making these comments, Wilson has alienated Lululemon’s customer segment. This reflects incredibly poorly on the company and their values. Angry costumers create bad press, and bad press hurts revenue generated by sales. Lululemon’s stock has plummeted as a result. Can they recover from this loss? That’s not for me to say. However, I can only imagine how discouraging this must be for women who supported the company.

Lululemon’s Yoga Pants

Source:

http://www.huffingtonpost.com/2013/11/14/lululemon-alienating-customers_n_4275842.html?utm_hp_ref=canada-business&ir=Canada%20Business

Green Arc Tire Manufacturing Inc. has a recycled tire production plant in the works, and it’s en route to being the largest recycled production plant in North America. The company will feature green winter tires with improved traction and fuel efficiency at lower prices, according to Mike DiCenzo, COO of Green Arch. The manufacturing process remolds used tires, effectively utilizing 80% of the originals. DiCenzo went on to state that he is associated with distributors in 90 countries worldwide.

Will the “green tire” trend catch?

Nowadays, it appears that everyone is searching for more economical options. A new set of winter tires usually costs around $500-$1000 depending on the car, which can be quite expensive. The promotion of winter tires can be difficult due to associated costs. Less expensive tires will likely result in safer roads for everyone. The ‘green factor’ is a bonus – it reflects positively on the company, as sustainability a pertinent issue. It appears that Green Arch is paving the way, developing a product that will satisfy beyond the threshold of environmentalists.

Green Arc Tire Manufacturing plant. Photographed by Brian Dunseith/CTV Kitchener

Source:

http://www.theglobeandmail.com/globe-drive/new-cars/auto-news/largest-recycled-tire-plant-in-north-america-opening-in-ontario/article15438269/

Apple’s recent release of a new iPad Air came as no surprise. A few years ago, the iPad was the only (and arguably the best) option on the market if one was looking to purchase a tablet. Today, Apple remains a consumer favourite, but in order to justify their high prices their products must continue to exert their superiority in both function and style.

The iPad Air does just that, heightening the air of simplicity and minimalism that marks the appeal of all Apple products. The Air is slimmer, only .29 of an inch thick, maintaining its lead in the quality and quantity of Apps it provides. It also boasts updated wireless technology that will create a noticeable difference.

Many people argue that Apple releases products too quickly, and because they are so expensive it is often challenging to upgrade quickly despite one’s desire (and the social pressure) to do so. Personally, I think that their marketing strategy is genius. The desire that they inspire guarantees that somewhere, people are going to purchase their product to stay up to date. Apple has successfully created a differentiated product resulting in a high barrier to entry.

The iPad mini, left, and iPad air, right, held at the launch event. Photographed by Noah Berger/Bloomberg

Source:

http://www.bloomberg.com/news/2013-10-30/new-ipad-is-slimmed-down-speeded-up-rich-jaroslovsky.html

HP has long been known for their technological innovations resulting in birth of Silicon Valley and egalitarian culture which many organizations model themselves after. However, in recent years, HP has been struggling with their products but most importantly, their culture. HP’s CEO, Meg Whitman, expressed her concerns through an internal memo asking employees to work in their offices instead of at home. This decision is based on the theory that collaboration between employees through face-to-face contract increases creativity and productivity. This is an example of HP’s attempt to focus on their culture and people.

Despite her efforts, Whitman may be inadvertently damaging HP’s culture. Many modern information technology companies offer telecommunication for their employees because they understand that employees tend work more productively and more than the compulsory hours. Telecommunication also acts as an incentive for many employees since the information technology market is highly competitive. If Whitman’s decides to implement mandated office hours, there may be a high number of employee turnovers. Whitman needs to recognize that although telecommunication may take some management time, the investment will pay off.

Meg Whitman, HP’s CEO. Photograph by Shanghai Daily via AP Photo

Source:

http://www.businessweek.com/articles/2013-10-09/at-hp-meg-whitman-wants-people-to-show-up-for-work

In response to my friend Justin Yee’s post on the intellectual property of Blackberry, I completely agree with his statement that Blackberry’s technology’s popularity coincided with when the smartphone maker itself was popular. However, despite its current situation, there is definite value in Blackberry’s intellectual property portfolio. Blackberry’s popularity was largely due to its endorsement from governments and large corporations. Their encryption technology, such as encrypted e-mail and messaging service, prevents sensitive data from being obtained.

Whether or not the company decides to sell its patents to enhance their recovery process is still up for debate. Despite its unsuccessful attempt in the consumer smartphone industry with the Z10, Blackberry still hold extremely valuable technology which can save the giant in the government and corporate smartphone market. If Blackberry does choose proceed with its corporate business, it may prove to be successful once again. We can not also disregard the $2.7-billion of cash Blackberry still possesses on its balance sheet when talking about take over. If Blackberry were to be taken private, the company still become profitable through its current customer segments.

On Friday September 20, 2013, Blackberry announces that it will write off $1-billion worth of phones and part and also cut 40 percent of their current workforce in an attempt to save the company from free fall. This write off is largely due to an inventory surplus of Blackberry’s new Z10 smartphone. The lack of sales in the smartphone division will result in a quarterly revenue of under $800-million, significantly less than the $1.7-billion it reported a year ago. This news shocked investors’ confidence resulting its share prices tumbling 16 percent.

Blackberry’s decision to compete with smartphone giants, Apple and Samsung, inevitably backfired. The poorly marketed Z10 smartphone was unable attract consumer attention with an unimpressive value proposition, hindering its ability to differentiate itself. Instead of attempting to compete with Apple or Samsung, Blackberry should shift their focus on their two larger customer segments: governments and corporations. Since its founding, Blackberry was able to capture this customer base with its encrypted e-mail and web-browsing technology. If Blackberry continues to focus its resources on the consumer smartphone industry, the question won’t be will Blackberry succeed. It will be when the giant from Waterloo fall.

BlackBerry Z10 Advertisement

Source:

http://www.theglobeandmail.com/report-on-business/trading-in-blackberry-halted/article14440386/

Roaming is an important factor to many consumers’ choice of carrier. Being one of the 3 major telecommunication providers in Canada and holding virtually monopolistic power, Bell is giving in to its subscribers’ demand for lower roaming rates. Its new roaming plans will have their prices be cut by as much as 50 percent. This decision was largely due to the feedback provided by its customers. In a press release, Bell stated, “We’re starting with the most popular destination, and Bell is committed to working with our global telecom partners to further reduce international roaming costs for our customers.”

Although Bell’s decision may seem as a response to feedback, I believe that it’s attempt to keep its monopolistic power by preventing companies such as Verizon and AT&T from entering the Canadian market. If Bell does not reduce its roaming prices, it may create an opportunity for Verizon to capture and further add to its value proposition. Diversified customer base is a huge part of any business and large corporations cannot afford to alienate a particular segment. By understanding its consumers’ need, Bell is able to retain is current customer base and can exploit new marketing strategies revolved around their decision.

Bell Authorized Dealer. Bloomberg

Source:

http://www.theglobeandmail.com/report-on-business/bell-to-cut-roaming-fees-by-half/article14333517/

It has recently been revealed that the workers of the production company, Jabil Circuit, which manufactures the new iPhone 5C, has had their rights ‘flouted’ by the company. The news came in after allegations made by China Labor Watch, a non-profit organization, that workers were required to work 12-hour shifts, six days a week, with only two 30-minute breaks. There has also been claims that female employees were asked to take pregnancy tests; this violates both Chinese laws and the code of practise which Apple has imposed on it suppliers last year.

Although Apple is the only technology company to be a part of the Fair Labor Association, it raises the question, why is this happening again? It was only a year ago when Foxconn’s employees, another manufacturer of Apple products, committed suicide to protest harsh and illegal working conditions and practices.² These practices raise some very questionable business ethics.

In the end, products such as the iPhone 5S, iPhone 5C, iPads and alike continue to be sold in large quantities regardless of what is going on in the manufacturing plants. However, we must ask ourselves the real question, why do we still support these companies?

Apple advertising its new iPhone in China. Photograph: Kim Kyung-Hoon/Reuters

Source:

http://news.cnet.com/8301-13579_3-57515968-37/riots-suicides-and-other-issues-in-foxconns-iphone-factories/

http://www.theguardian.com/technology/2013/sep/05/workers-rights-flouted-apple-iphone-plant