Lisa’s blog post about Polyvore, a “social shopping website”¹, not only sells brand-name products, but also provides style advice and has a tool that allows you to “mix and match outfit sets”¹.

This truly innovative tool is an excellent way to differentiate from other clothing sites, as Lisa mentioned. I think this tool has the potential to increase sales dramatically because it allows the customer to virtually put together an outfit with real products right on their screen. Suddenly, the product becomes relevant to the buyer—who can better imagine what the item will look like when paired up with their existing wardrobe—instead of a single, disconnected garment.

I would definitely use this addictive tool to shop online, and as a consumer I would be tempted to buy more because of the endless choice of outfit combinations available to me with a simple click of a button. It is understandable that this business has been “successful in quickly gaining millions of dollars of income over the span of a few years”¹, as Lisa said, not only because of increased sales, but also because brand name companies pay to have their products displayed on this website. Thanks for the post, Lisa!

Something really quick I whipped up. Awesome tool!

Word count: 199

References

1. Wu, Lisa. (2011, November 8). Success in a Changing Market. [Web log comment]. Retrieved from https://blogs.ubc.ca/lisawu/2011/11/08/69/

This article is about Groupon’s position in the stock market and how investors anticipate its health for the next year or two. It focuses on short selling, which can be an easy money making move for investors—they borrow the stock from a stockbroker, sell it under their account, wait until the price goes down and rebuy it to make a profit on the difference.

However, analysts caution against “shorting” the company so soon after its recent IPO because stockbrokers can charge 90-100% to borrow its scarce stock (Groupon sold about 6% of its stake in its IPO, “one of the smallest in the past decade”¹).

Maybe Groupon needs to reconsider its financials first

This article reminded me of the one we discussed in class earlier this year. I’ve since discovered that Groupon has “changed its accounting twice”¹ and has a relatively high take rate (the amount Groupon shares with its merchants) compared to its competitors, in addition to their rising costs, which I discussed in an earlier blog post.

Investors are watching Groupon very closely to see how it behaves in the market. Currently, it’s being traded at a much higher rate than its competitors, but this volatile sector of the market is become increasingly unpredictable—I’m interested to see how it plays out over the next few months.

Word count: 200

References

1. Barr, Alistair. “Analysis: Short Sellers Wait to Bet Big against Groupon| Business| Reuters.” Reuters.com. Thomson Reuters, 14 Nov. 2011. Web. 17 Nov. 2011. <http://ca.reuters.com/article/businessNews/idCATRE7AD2E820111114?sp=true>.

I came across this blog post on Pamela Ho’s blog concerning business ethics. The post describes Dole and Chiquita, huge banana distribution companies, and their accusation of an “environmentally unfriendly method for transporting and refrigerating their bananas overseas” ^1. 

Pamela comments on Dole and Chiquita’s use of Canadian tar sand oil to fuel their transportation: “By using the tar sands Dole and Chiquita’s main goal clearly is bringing in as much profit as possible” ¹ . I think that while many companies do use natural resources irresponsibly, it’s important to distinguish between those that are intentionally irresponsible and try to get away with it and those that are just unaware. Perhaps Dole and Chiquita decided on a fuel source based on its location, Alberta, not its method. They aren’t the ones supplying the oil, an external distribution company is (Dole had to contact their suppliers after these allegations to verify no use of tar sands fuel). Of course, that brings up the point: companies should do their research before deciding on a fuel source.

But 30 years ago, maybe nobody would have cared where it came from. While it’s extremely important to pressure companies on their environmentalism, we have to understand that they are not always at fault. There’s a time to be corrective, but right now we have to be collective.

Word count: 200

References

1. Ho, Pamela. (2011, September 15). Business Ethics – Dole and Chiquita [Web log comment]. Retrieved from https://blogs.ubc.ca/pamelaho/2011/09/15/business-ethics-dole-and-chiquita/

2. Siegel, RP. “Hey Chiquita, Dole: Isn’t the Use of Tar Sands Oil Bananas?” Business Exchange. TriplePundit, 31 Aug. 2011. Web. 13 Nov. 2011. <http://bx.businessweek.com/business-ethics/view?url=http://www.triplepundit.com/2011/08/tar-sands-oil-bananas/>.

This blog post by Anthony Tjan, CEO of the venture capital firm Cue Ball, explains society’s growing dependence on technology as a means of communication, notably in business. By trying to resolve conflicts over Email rather than by telephone or in person, we actually worsen the problem and hinder resolution. This happens for three reasons: It is hard to get the EQ (emotional intelligence) right in email, Email and text often promote reactive (vs. progressive) responses, and Email prolongs debate¹.

I thought this blog post posed some very valuable points. Mr. Tjan’s ideas are applicable to almost every situation, business-related or not. For example, in a personal relationship, most conflicts are better resolved in person than through an indirect technological means. Nowadays, it is easy to lose track of which situations are appropriate for computer-related interactions. This is related to the increased amount of time people—especially youth—spend on the internet. Children are being introduced to Email, Facebook, Skype, etc. earlier, thus imprinting a sense that technology is imperative in communication. Although telephoning is also a type of communication, it is easier to transmit emotion and expect a quicker response than in Email. Meeting in person is even better—it’s important to foster the “people” side of business, something that is escaping our society as technology improves.

Word count: 200

We could use some People around here

References

1.Tjan, Anthony. (2011, November 1). Don’t Send That Email. Pick up the Phone! [Web log comment]. Retrieved from http://blogs.hbr.org/tjan/2011/11/dont-send-that-email-pick-up-t.html

Disney is considered entrepreneurial because it thrives on innovation, new products and new production methods (from Schumpeter’s View of Entrepreneurship). Disney was especially entrepreneurial at the time of its founding, in the 1920s, because Walt Disney was among the first to pioneer the cartoon and animation industry. In a way, he created his own niche market and, in essence, made something out of nothing.

Although Disney’s target market is simply children, there exists a variety of products (films, stores, Disneyland, etc.) that are suitable for everyone. Young children also happen to be the most impressionable age group of all, so exposing them to the “magic of Disney” will leave the product imprinted in their brains for a long, long time (case and point: I still love Disney movies).

At the time of its conception, Disney must have been prone to risk as a result of being the “only one” in its hit-and-miss market. However, through imagination and innovation, Disney was able to quickly, and sizeably, increase its wealth, differentiating it from a small business. Even with the initial entry of Pixar and other filmmaking companies, Disney has proved to remain successful and innovative. I think Disney was, is, and always will be, no doubt one of the most entrepreneurial businesses to ever exist.

The article Dark side of the daily deal frenzy: Local online ad rates soar explains the impact of companies in the daily deal industry such as Living Social and Groupon on smaller businesses. This trending industry offers discounts on local products and services. Competition between these companies—the biggest obstacle for them to stay afloat—is becoming increasingly aggressive because “the cost of [Google’s paid search system]”¹, a cost-effective approach for advertising, has more than tripled in the last two years.

Groupon has used “bait and switch” advertising: using irrelevant search terms on Google to falsely advertise their product (for instance, searching for “Alcatraz tours” and viewing an ad for a restaurant in Vancouver via Groupon), which disadvantages many smaller, locally owned services.

Groupon now markets products and services in 43 countries around the world.

Although the soaring costs of advertising is putting a dent in Groupon’s budget, I don’t think it will have any problem acquiring more customers and keeping current ones. Groupon should be more closely regulated on their advertising techniques because it is unjust and unethical to capitalize on smaller businesses in this way. Smaller businesses must find a way to be prominent online—despite the increased costs, I would suggest expanding their search words and extending to more websites.

Word Count: 198

References

1. Barr, Alistair, and Dan Levine. “Dark Side of the Daily Deal Frenzy: Local Online Ad Rates Soar – The Globe and Mail.” Home – The Globe and Mail. The Globe and Mail Inc., 10 Oct. 2011. Web. 12 Oct. 2011. <http://www.theglobeandmail.com/news/technology/tech-news/dark-side-of-the-daily-deal-frenzy-local-online-ad-rates-soar/article2196561/>.

The article describes the increasing importance of incorporating sustainable practices into companies’ operations and HR departments. Sustainability is an emerging “business megatrend”¹ that will “profoundly affect the competitiveness—and perhaps even the survival—of [executives’] organizations”¹. Business leaders tend to veer away from addressing sustainability because they are not certain whether it has any tangible future. By analyzing prior megatrends, executives can understand how to “craft the strategies and systems…to gain advantage”¹ in this emerging one named Sustainability. The article concludes that managers “can no longer afford to ignore sustainability as a central factor to… competitiveness”¹.

I have a growing interest in sustainability and how to integrate it into business, so this article pointed out some important information that I also believe is imperative to existing and emerging businesses. Failure to realize that sustainability is becoming just as important as other megatrends, such as quality and IT advancements, will most likely result in a negative response in business because consumers are increasingly valuing the implementation of sustainability in corporations’ internal and external operations. For example, sustainability is important to my family, so I might be inclined to do business with a more sustainability-oriented organization than an “ignorant” counterpart. I want to contribute to this emerging megatrend, and I am excited to see how it will develop in the future.

Sustainability... more important than you think

References

1. Lubin, David A., and Daniel C. Esty. “The Sustainability Imperative – Harvard Business Review.” Harvard Business Review Case Studies, Articles, Books. Harvard Business Publishing, May 2010. Web. 10 Nov. 2011. <http://hbr.org/2010/05/the-sustainability-imperative/ar/1>.

This article describes how Reebok must, by the Federal Trade Commission, reimburse its consumers $25-million U.S. for providing “deceptive advertising” about their EasyTone shoes, which claim to be able to “tone the gluteus maximus up to 28% more, and calf muscles up to 11% more, than regular sneakers”. Television ads for the product feature “a twirling parade of women’s finely toned rear-ends and lower extremities” concluding with the “unscientific claim: ‘Better legs and a better butt with every step’”.

While reading this article, I was reminded of the power of advertising on an ill-informed public. David Vladeck, director of the FTC’s Bureau of Consumer Protection, reminded consumers “there is no such thing as a no-work, no-sweat way to a fit or healthy body”. With endless amounts of claimed effortless body enhancing and dieting products, it is becoming increasingly important for consumers to be educated on certain products. Corporate responsibility is an issue here, and it worries me to think of how easy it is for adults—and more alarmingly, children and adolescents—buy into false advertisements. Although there exist products more misleadingly dangerous than EasyTone sneakers, Reebok has crossed the line of acceptable advertising. Ethics are more important than profit.

Word count: 200

TV ad promoting Reebok's EasyTone shoes

References

1. Houpt, Simon. “FTC Rebukes Reebok Marketing in Settlement – The Globe and Mail.” Home – The Globe and Mail. The Globe and Mail, 28 Sept. 2011. Web. 9 Oct. 2011. <http://www.theglobeandmail.com/report-on-business/industry-news/marketing/persuasion/ftc-rebukes-reebok-marketing-in-settlement/article2183522/>.

Steve Jobs introducing new iPod nanos in 2006

World dances to Steve Jobs’s tune is an article showcasing how Steve Jobs, founder and former CEO of Apple, revolutionized the music industry with his creation of the iPod and iTunes. This article reminded me of our study of brand positioning and value proposition, because Jobs succeeded in creating a strong identity for Apple and a permanent place in the music industry.

I believe Apple’s brand proposition and positioning are key. With a target market not limited to solely youth, who are the brand’s biggest users, Apple prides itself on providing vast, simple to use products in the music sector that aims to create choice for its consumers. iTunes, for example, gave consumers “the ability to cherrypick the tunes they wanted and the feeling of control”¹ with its “flat 99-cent-per-song-fee”¹. In my opinion, Apple has arguably one of the best brand positions in history, which stemmed from great innovation on Jobs’s end.

Apple has existed without lack of negativity over the years, taking criticism from music powers such as Jon Bon Jovi, who “directly blamed Jobs for killing the music industry”¹. However, Apple has continued to empower its brand, which deserves credit following Jobs’s tragic death last week.

Word count: 198

References

1. Abram, Malcolm X., Akron and Ohio, and McClatchy. “World Dances to Steve Jobs’s Tune.” The Vancouver Sun. The Vancouver Sun, 8 Oct. 2011. Web. 9 Oct. 2011. <http://www.vancouversun.com/technology/steve-jobs/World+dances+Steve+Jobs+tune/5523320/story.html>.

Microfinance: the future?

The article Impact Investing: Happy returns discusses the emerging concept of “impact investing”- an alternative to traditional capitalist investing with a social twist. The goal of impact investing is “to improve the world as well as make money”¹, said Jed Emerson, co-author of a book about impact investing.

The article highlights Leapfrog Investments, a “microinsurance fund” that invests in companies who provide insurance to developing nations. Leapfrog Investments’ first deal was investing $6.7m in AllLife, a South African company providing life insurance to HIV/AIDS victims.

This shift in corporate investments reflects the recent emergence of corporate social responsibility sectors. I support this aspect of business because I find it noble and beneficial to society for companies to venture into impact investing. Since impact investing is a fairly new concept, the risks are high (such as very low profit and disagreements between investors as to which firms are exactly considered socially responsible); however, Ron Cordes, a finance guru, explains that “microfinance debt was the top-performing piece of [his] portfolio” when the finance market crashed in 2008. I believe corporate social responsibility is an increasingly important part of the business world, and that impact investing will prove to become a large, important sector in the future.

Word count: 200

References

1. “Impact Investing: Happy Returns | The Economist.” The Economist – World News, Politics, Economics, Business & Finance. The Economist Newspaper LImited, 10 Sept. 2011. Web. 15 Sept. 2011. <http://www.economist.com/node/21528678>.