Month: November 2013

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.

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.

Source:

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