Tony Wanless’s blog about the affect of the Washington State vote to legalize marijuana on BC’s growing illegal marijuana industry is very interesting and prevalent. The humorous writing style contrasted with the seriousness of the topic makes it an enjoyable read. Nevertheless, it is informative and brings to light the very real consequences this new decision has on BC.

The proceeds that criminal organizations are making here in B.C. by delivering the product to Washington State will decrease substantially because they will no longer be able to reach the black market. However, other markets for B.C. bud will remain. My feeling is the industry won’t vanish but the loss of Washington State in particular will be felt. BC’s reputation for premium quality marijuana will help it to retain market share although some of it will be lost.

Wanless exaggerates the extent to which the Washington State vote will affect the illegal BC marijuana industry (which I believe is part of the humor) but does stress the fact that marijuana is a large source of income within BC.

Original Article:

http://www.bcbusinessonline.ca/politics/bye-bye-bc-bud

Not only are salmon they remarkable creatures in the ocean but also extremely palatable on mankind’s plate.The depletion of wild salmon stocks is no surprise and sustainable ways of salmon farming are continually discussed. Two such ways are closed containment technology (fish are kept in containers either in the ocean or inland) and net-pen salmon farms (netted off areas in the ocean along the coast). The article asserts that, “In consumer taste tests, 80 per cent chose the closed containment product over the net-pen product”. This suggests consumers are becoming more environmentally aware as close containment farms are seen to be more environmentally friendly than net-pen farming.

However, as in most cases, the cost of adopting a more environmentally conscious attitude in any business does not come without added complication and costs. The energy required for closed containment farming is greater as land-based salmon farming requires large amounts of seawater to be pumped inland and if hydro-electric power is not readily available, fossil fuels are needed to power generators. The management of waste and costs associated with implementation and logistics can make closed containment farming very unattractive to businesses.

Net-Pen salmon farms have no extra cost to the industry and waste products are released directly into the surrounding water. This causes the waste settles to the sea floor and cause serious harm to the immediate environment and the species that live within it. Thus although there are no costs to the business, the cost to the environment is extremely high and presents a trade-off.

Salmon farming is one example that presents the dilemma in sustainability. Firstly demand needs to be there for more environmentally conscious products, given that most of these will be at a higher price, and secondly the willingness of businesses to enter into environmentally friendly production.

Original article:

http://www.vancouversun.com/travel/Environmental+pressure+creates+demand+sustainable+fish/7564641/story.html

Advances in technology have astounded many and affected all sectors of the economy. Now the thought of virtual payment alternatives come as a threat to some and an opportunity to others.

One such method is a digital wallet that stores payment cards in a virtual storehouse and allows the consumer to make purchases online by entering a username and password. No personal details or card numbers needed. The head of Square and a co-founder of Twitter, Jack Dorsey, “agrees that digital wallets will make the trade-offs between various payment options clearer to consumers and reckons this will force card networks to up their game.”

This is an example of how Business Technology Management (discussed in our lectures) can benefit consumers as technology is used to change the way in which purchases are made. In fact these types of online payment alternatives may revolutionise the way we perceive and use plastic credit/debit cards. According to Nilson Report (an industry newsletter), “Last year some $6.7 trillion was channeled through credit cards managed by the networks and over $15 trillion in debit and prepaid cards” (on chart bellow).

However, it seem in the short term new technology is encouraging the usage of payment cards. For example, smartphone apps often require users to enter their card details to pay for services. Although BTM is transforming the way in which we make purchases card companies/networks are not about to let it lead to their demise. Instead they have heavily invested in technology and embrace the inevitable. “Visa is betting its member banks can help it to narrow the gap with rivals like PayPal, for instance, which is part of eBay and has grown to 117m active users thanks in part to its use on the auction site.”

Another way for card companies to maintain their capital gains would be to invest in emerging markets, “where a lack of financial infrastructure is hastening the rise of phone-based payments systems”. MasterCard has already established a joint venture called Wanda with Telefónica (a Spanish telecoms firm), which aims to boost mobile payments across Latin America.

Original Article:

http://www.economist.com/news/finance-and-economics/21566644-visa-mastercard-and-other-big-payment-networks-need-not-be-victims-shift

The importance of effective operations management, distinguishing a company from its competitors (through points of difference) and constant product innovations is highlighted in Macdonald’s first monthly sales decline in nearly a decade.

Macdonald’s decision to replace their operations manager during this time reminded me of Mahesh’s lecture on supply chain and operations. Mahesh stressed the significance of ensuring that products are successfully delivered to consumer at the right time, in the right quantities and in the right places to allow for maximized profits. A prerequisite for this is of course accurate forecasting. In this case forecasting may have been disturbed due to the fact that, “McDonald’s has struggled recently amid intensifying competition at home and a persistently weak economy abroad”.

MacDonald’s has tried to differentiate themselves from other fast food competitors through the introduction of, “a slightly more expensive “Extra Value Menu””. This point of difference not only distinguished them from their competitors but also would allow them to gain more market share as more healthy conscious consumers would be attracted to MacDonald’s food.

However, analyst Thompson recently asserted that MacDonald’s is returning its focus to its Dollar Menu, since the value added menu has not been as successful as was hoped. Macdonald’s may need to reevaluate their target market as it seems generally their consumers are not interested in more nutritious food but simply for a quick, cheap meal.

In order to retain and attract more consumers it is crucial for MacDonald’s to continue to innovate and experiment with their menu. Although some experiments will prove to be somewhat unsuccessful (like the introduction of healthier food options) others will help the chain to propel itself within the industry. One such successful innovation was the expansion of specialty drinks menu that “is popular and was credited for helping sales in the past year”.

Original Article:

http://www.theglobeandmail.com/report-on-business/international-business/us-business/mcdonalds-replaces-head-of-us-operations-amid-sales-struggles/article5327971/#

Entrepreneurship’s innate ability to inspire those it reaches and instill within them a determination to succeed is exemplified within a group of Jordanian woman. Mr. Omar, creator of Sitat Byoot/”Women at Home” an online Facebook page that is used as “a marketplace for Arab handicrafts created by women”, saw an opportunity for the Arab world to be a part of the worldwide handmade industry. As a result of his entrepreneurial spirit and initiative, many Jordanian women are able to gain employment and support themselves.

One such woman is Ms Qouqas who recently became a single mother of three children, forced to support herself in a society that discourages female independence, education and employment. Ms Quoqas admitted, “I already had the passion and commitment to make unique products that cannot be easily found in shops”, where Sitat Byoot facilitated the opportunity to foster this passion and turn it into something tangible and lucrative.

However, like many social entrepreneurial ventures economic sustainability is a main concern for both the women and Sitat Byoot. Mr Omar admits that the absence of  “Social impact investors” warrants sustainability a major problem. It is without a doubt that the social impact of such an initiative outweighs the struggles of financial obligations a thousand fold. Ms. Qouqas expresses her hopes as she says, “I really want to believe that people will realize that this is part of our tradition and that women have talents and have always worked. They can contribute a lot to society”.

Original Article:

http://www.nytimes.com/2012/11/01/world/middleeast/01iht-m01-jordan-women.html

Toys once treasured and adored by children are now on the decline as lack of innovation leaves children uninterested and in search of fun alternatives. The detrimental effect of neglecting innovation in toy products has caused technology to fill that gap. Increased strides in technology have harvested a technologically savvy generation where gaming technology seems to beat toys by far.

Gerrick Johnson (analyst at BMO Nesbitt Burns) predicted that, “the estimated $21.2-billion (U.S.) of annual U.S. toy sales will fall by 3.5 per cent in 2012 – and 2.5 per cent during the crucial holiday season – producing the sharpest drop since he began tracking toy sales in 1980.”  It seems consumers have progressively been moving away from toys and towards today’s captivating gaming technology.

Retailers are now attempting to win back market share to gaming technology giants through marketing, saving strategies and innovation which is proving very difficult. A major issue is that, “toy makers take 18 to 24 months to develop a product, and little of this work was being done in the past two years in the tough economy”. Thus this has resulted in a period of stagnated innovation and severely affected the future of the toy industry. It could be the case that toys are simply outdated – as camera’s that used photographic film were replaced by digital camera technology.

Original Article:

http://www.theglobeandmail.com/report-on-business/tough-economy-leads-to-trying-times-for-toy-makers/article5357558/

Mustafa Ahsan’s blog post on Neuromarketing forced me to consider a completely different approach to marketing that has added new depth to my understanding. It is both fascinating and terrifying that technology has advanced enough to be used to manipulate the human mind. Mastering Neuromarketing technology is of course a marketer’s dream, but may have serious ethical and social long-term consequences.

In our marketing lecture we discussed the extreme difficulty marketers face when trying to reach their consumers and fight for their attention. A.K. Pradeep, CEO of NeuroFocus asserts that, “If pitches are to succeed, they need to reach the subconscious level of the brain, the place where consumers develop initial interest in products, inclinations to buy them and brand loyalty”. Measuring brain waves and thus concluding the stimuli for subconscious activity achieves this.

Google, Disney, CBS and even some political campaigns have utilized Neuromarketing in order to tap into the public’s brain. Consumer advocates are rightly calling Neuromarketing, ““brandwashing” – an amalgam of branding and brainwashing”. The probing of our subconscious brain patterns may be used to influence consumer behavior without our consent.

With the continual research and development Neuromarketing may be used as a tool to influence our decisions about much larger, more pertinent issues as Dr Pradeep explains, “If I persuaded you to choose Toothpaste A or Toothpaste B, you haven’t really lost much, but if I persuaded you to choose President A or President B, the consequences could be much more profound”.

However, the technique has yet to prove that brain-pattern responses to marketing associate with purchasing behavior. Although with the consistently rapid growth of technology it may not be long until marketers are able to hear “the whispers of the brain”.

Citation:

Ahsan, Mustafa. “Neuromarketing.” (2012): n. pag. Web. 6 Oct. 2012. https://blogs.ubc.ca/mustafaahsan/.

Singer, Natasha. “Making Ads That Whisper to the Brain.” The New York Times. N.p., 13 Nov. 2010. Web. 6 Oct. 2012. http://www.nytimes.com/2010/11/14/business/14stream.html?_r=0.

One of the most dominant airlines in low-cost air travel today with its unique and, often times daring, cost-cutting and marketing strategies is explored in Kevin Lu‘s blog post. Since I can be considered part of Ryanair’s target market, this particular blog posting caught my attention as an interested potential consumer of Ryanair services.

Ryanair has accomplished something very unique in that its point of difference is in fact its low-cost tickets and corresponding absolutely minimal air services. During lecture discussions on marketing strategies and stakeholder theory the importance of creating a strong and attractive business image and valuing all stakeholders within the business was emphasized.

However, Ryanair seems to have no problem portraying an image of cheap service and poor quality flight-experience as well as undervaluing the significance of healthy stakeholder relations. This is suggested in Kevin’s post as he mentions ethical implications of charging consumers for access to restrooms on board. Not only does this portray Ryanair in a light that may not be attractive to consumers but also suppose that Ryanair does not value their connection with consumers (against stakeholder theory).

What is even more astounding is that consumers targeted by Ryanair seem to be largely unmoved by the airline’s questionable ethical conduct or poor quality service, as ticket sales are still on the rise. For Ryanair marketing image and stakeholder theory may not be as important as long as the consumers’ pockets are not completely emptied by the end of the flight. One would be wrong to assume the ‘head honcho’ of low cost air-travel would lose market share as it continuously pushes the boundaries of ethical business conduct.

Sources:

Lu, Kevin. “How Cheap Is Too Cheap?” (2012): n. pag. Web. 6 Oct. 2012. https://blogs.ubc.ca/kevinlu/2012/09/13/how-cheap-is-too-cheap/.

http://www.ryanair.com/doc/investor/2012/q4_2012_doc.pdf

Penn State Nittany Lions has been known throughout the US for their strength and talent in the football world. The team has maintained healthy relationships with sponsors and a strong image as a competitive and professional football team until now. The University of Pennsylvania’s sex abuse scandal has devastated the football team’s reputation and media image, severely damaged its sponsor relations and incurred heavy financial losses.

Penn State’s reputation has caused leading sponsors, fans and partners to rethink their involvement with the once prestigious football team. In 2011 it was recorded that, “Nittany Lions generated $73 million in revenue and earned a profit of $53 million for the university” and thus functions similarly to a businesses. It is vital for any business to maintain healthy relationships with individual stakeholders – in this case particularly the sponsors (financiers). Penn State’s sex abuse scandal has left irreparable damage to sponsor relationships causing, “State Farm Insurance [to pull] direct sponsorship of Penn State football for the 2012 season… and General Motors [to consider] doing the same”.

The undeniable link between marketing and finance presents itself within Penn State’s dilemma as their now ruined image from a marketing perspective has seriously compromised its financial status. Penn State now has to pay “$60 million fine, is banned from postseason play including bowl games for four years and will vacate its 112 wins from 1998-2011”. The scandal has not only affected the football team in the ways aforementioned but also its partners. Media partner Learfield Sports has committed to remain loyal to Penn State, even though Learfields association with Penn State may put their reputation in jeopardy.

The once, “third most valuable college football program with $100 million” according to Forbes is now facing a feature that is not as promising. This demonstrates that no matter how established or elitist a business/organization is, preserving healthy stakeholder connections and good reputation/image is extremely important. The link between marketing and finance, especially in this case, cannot be ignored.

Citation:

Channick, Robert, and Kathy Bergen. “State Farm May Not Be Only Sponsor to Step Away from Penn State Football.” Chicago Tribune. N.p., 25 July 2012. Web. 1 Oct. 2012. <http://articles.chicagotribune.com/2012-07-25/business/ct-biz-0725-state-farm-20120725_1_penn-state-state-farm-ncaa-sanctions>.

BP, a multibillion-dollar energy and petrochemicals company, has been largely responsible for the extreme environmental degradation that has affected Nigerian communities for decades. With, “over two million barrels of oil produced per day” and thousands of miles of pipeline laid through swamps, the foreseeable environmental cost has taken a devastating toll on the Nigerian people. It seems BP’s social responsibility to the local people and environment in which they operate has been shortchanged – to say the least. In a 2006 report international and local environmental groups concluded that, “546 million gallons of oil have been spilled into the Niger Delta over the last five decades” leaving locals destitute and unable to utilize the once plentiful resources of the Nigerian swamp lands to sustain themselves. Market woman Hannah Baage exemplifies the product of BP’s inability to practice business ethics as she divulges, “There is BP oil in my body”.

BP has failed to find the crucial balance between profitability and ethical responsibility while accommodating all its stakeholders. A successful business must be able to engage positively with the various factions affected by the business – especially as the business becomes larger and more influential. Even a company as sizeable and powerful as “BP” cannot afford to ignore Business Ethics and should practice it in all divisions of its business (marketing, financing, human resource, etc).

Case study used:

Far From Gulf, a Spill Scourge 5 Decades Old 

By ADAM NOSSITER

Published: June 16, 2010

http://www.nytimes.com/2010/06/17/world/africa/17nigeria.html?_r=0