My teammates and I were excited upon choosing Zara as our focus company for the marketing project, as we have heard about how its “fast-fashion” model and renowned supply chain management are major contributors to its success today. I was curious to gain more insight into how the company develops and manages its customer relationships, as conventional advertising methods are not used. Out of the three assignments that we handed in, I found it most difficult to get a start on the Segmentation, Target, and Positioning (STP) report. After getting further clarification with the instructor as to how a worthwhile segment is recognized and the various segmentation variables, we were able to understand the different perspectives that we should take into account. In hindsight, we probably should have been a little more creative with these segments and looked into some potentially worthwhile segments.

It was definitely useful to have the librarian from the David Lam Library come talk to us about the abundant amount of accessible resources for research. Using this knowledge, I found very useful and reliable articles and books found in the databases. Because Zara is a private company, it was difficult finding specific information about the company’s financials and reports. However, we got around this obstacle by looking at articles and books about specific information relating to the “fast-fashion” and apparel industry. Extracting relevant information and analyzing it to support our ideas was one of my group’s strengths. The video-making process was also a new and interesting experience that had not been incorporated in other Sauder courses that I have taken. For the video assignment, we considered filming a debate, conversations, and scenes interacting with Zara’s customers and employees. In the end, we felt that these options were too common – note: relatable to Zara straying away from conventional advertising methods! After brainstorming, we were all very keen on producing an animated film instead. It was enjoyable being on a team with Claire Choi, Showki Li, and Daniel Zhang, because they were also very passionate about this course and keen on exceeding expectations. I truly enjoyed this team experience and I think what worked so well was that everyone on the team had different strengths and a diverse span of knowledge. We were able to recognize and understand this about each other, so we were able to divide the work in an efficient, well-organized way that made use of each of our strengths. I truly enjoyed this course and am looking forward to applying the principles and ideas that I learned to future courses and daily life.

“Coming together is a beginning.
Keeping together is progress.
Working together is success.”

– Henry Ford

(Photo credits: Natural Girl)

Speaking with a friend over dinner, she brought up her delightful experience of working at Lush and went to talk about why she loved working there. She explained to me how the company declines doing business with any supplier who is associated with animal testing or EVEN sold to a company who does animal testing. Furthermore, she found that the company’s culture was very loving and caring – seeing how the employees would be continuously caring for each other even on days outside of work. My interest in the company’s efforts is the reason why Tim’s post about Lush’s Charity Pot provoked me to read on about his understanding of Lush. He stated,

“The Charity pot is part of a larger strategy that sets out to position Lush as a brand with an exceptionally positive impact on the environment, humanitarian cause, and an ethical approach to doing business.”

In his post, he pointed out several interesting points, which made me recognize the interesting methods that Lush uses to interact with consumers and engage them with the brand. In correspondence with what Tim said about the campaigns supporting ethical issues, I recognize the kind of value it creates for a customer, especially as it is done a personal level. Lush does not use mainstream marketing channels to communicate its brand to consumers. In my experience, I have never seen any TV or newspaper ads from the company; instead, Lush gains a lot of publicity from its campaigns, which are often published as articles. Also getting much attention through word-of-mouth (in my case for example).

Its key point of differentiation is that all its products are handmade and completely organic. Being environmentally friendly and using organic products are one of the most significant issues today and this market creates a strong potential for Lush, as it is already one step ahead of the game. I remember buying some bath bombs from its mother’s day collection and nothing but a simple tag was attached, which was compostable and was suggested to be planted, as it was embedded with seeds. It was quite interesting to see the packaging of the product and noting that the packaging of all its products are either non-existent (bath bomb example) or recyclable. This entices consumers to buy from Lush, as it will allow them to feel a sense of positive contribution and impact to the environment. Lush has done an excellent job of covering all bases of their operations and has successfully positioned itself in such a way that has differentiated itself from its competitors and created a sustainable competitive advantage.

Lush’s most current endeavour? To no surprise, it’s getting on board with European Week of Waste Reduction. Read more: http://www.ashbournenewstelegraph.co.uk/Homes-and-Gardens/Green-Living/LUSH-Cosmetics-get-on-board-for-European-Week-for-Waste-Reduction-18112013.htm

Tim Martiniak’s post: https://blogs.ubc.ca/timmartiniak/2013/10/14/lush-charity-pot/

(Credit: Apple)

Apple has created a solution to the burdensome problem of not being able to keep a product’s identity after a rubber or plastic case covers it. Bearing resemblance to “swiss-chesse” and the “Connect Four” game board, these vividly colourful cases will scream out “Apple iPhone” to anyone within a 5-meter radius to one of its possessors. Furthermore, the radiant colours can almost guarantee that all teenage girls will want one – who are part of an especially attractive tween market:

With $51 billion spent by tweens (people aged 10 to 12) every year with an additional $170 billion spent by their parents and family members directly for them” (Six).

While I find it agreeable that the cases do give off the impression of a “Connect Four” game board, there are hidden beneficial elements behind the questionable design that was most certainly not a fluke on Apple’s part. Consumers’ opinions are quite divided – whereas great disappointment is shown in the comments section of Fast Code Design’s blog, Apple’s company website indicate mostly rave reviews. One thing that is for sure is that it was not a fluke that Apple introduced these oddly designed cases. Although there may be people who dislike its new design, I am confident that Apple’s new design will attract and further build on its brand awareness. No matter what people think about the case, their mind has already been infiltrated by the Apple brand. Proving once again, why Apple is a great marketer. In addition, it is also cost effective. The accessory business is one that offers generous margins, which can be seen through the introduction of 34 new cell phone case brands this year alone [3]. I also couldn’t help but notice the increased prevalence of stores in shopping malls mainly dedicated to the sales of smart phone cases over the past few years. The margin on the iPhone 5C cases is surely not a tight one – without consideration of the costs involved in the research and design of the cases, the manufacturing cost to make each case is estimated to be between $2 to $3 and is sold at $29 a piece. This example shows how important customization is to a tech company in a market where many devices look similar and are especially hard to distinguish between when covered with a case. What do you think of Apple’s new iPhone case design? Was it an ingenious or silly move on Apple’s part?

 Sources:

[1] http://www.fastcodesign.com/3017155/why-apples-iphone-5c-case-is-pure-genius

[2] Jill, Novak, Dr. “The Six Living Generations In America.” The Six Living Generations In America. University of Phoenix, Texas A&M University, n.d. Web. 14 Oct. 2013.

[3] http://news.cnet.com/8301-13579_3-57603379-37/why-apples-got-skin-in-the-iphone-case-game-again/

[4] http://store.apple.com/ca/product/MF035ZM/A/iphone-5c-case-blue

“Overall, the number of people with a tablet or an e-book reader over the age of 16 now stands at 43 percent. That’s up from just 25 percent last year.” [1]

During the summer of last year, my parents bought me a Kobo Vox eReader tablet that fulfills my functional need to have a portable device where all my books are stored digitally. At that time, there were not many touch screen eReader tablets in the market, so I was quite pleased that I had got something relatively “new.” I continued to be satisfied with it in the first couple of months, but of course, the inevitable happened – better, faster, slicker, or more inexpensive eReader tablets came out, such as the Kindle Fire and Kobo Aura. With the constant announcements of new technology, it is more important than ever for Kobo to reduce buyer’s remorse in order to keep customers satisfied, which is undoubtedly a very difficult task. This made me think of the time when retailer, Best Buy introduced its Buy Back program in 2011 for consumers who get frustrated when a recently bought electronic device quickly becomes obsolete. The slogan of the campaign was:

“You buy it now, we buy it back when the new thing comes out!”

In my experience, Kobo regularly sends me coupons via email for eBooks, which could to some degree reduce buyer’s remorse, as the company continues to extend out to its customers after making the sale. However, more effective strategies need to be undertaken to further address this issue, whether it may or may not be a strategy sharing similar concepts with Best Buy’s. Reading reviews of the tablet on pcmag.com, I have been quite disappointed with the negative experiences that other customers have received from the product – the device earned a lowly average rating of 2 out of 5 stars. This also illuminates the fact that there is a greater likeness for consumers to spread a bad word of the product that they are dissatisfied with (especially on social media platforms), as opposed to when they are content or ecstatic with their purchase.

Source: [1] http://www.redorbit.com/news/technology/1112979080/tablet-and-e-reader-market-still-growing-101813/

Best Buy’s “Outdated World” Commercial

Very intrigued with the discussion that instructor Silva facilitated in lecture surrounding the customer excellence of Singapore Airlines and its success in retaining loyal customers, I wondered about other examples in the airline industry. When travelling to Asian countries, I am  loyal to China Airlines, because of the very positive customer service experiences that I recall from when travelling as a child. Added onto the exceptional service that my family consistently received, I remember that they would also provide my siblings and I with playing cards, drawing books, and even a small stuffed animal on one occasion.

Due to the increasing competition in the airline industry, especially with the increase in airbuses offered at significantly lower prices, it has become tremendously important for airline companies to ensure a sustainable competitive advantage. Clearly, the 93- year old airline has been able to achieve customer excellence through various savvy campaigns, such as a social media powered “Meet and Seat” matchmaker and a Sims-like “mobile aviation game.” The post that instantly caught my eye when browsing through BrandChannel’s blog was its most recent campaign when I noticed that it involved direct interaction with children. Forming a partnership with Disney, KLM invited a handful of lucky kids to a pre-screening of Disney’s new film, Planes. But instead of it taking place at a local cinema, the children watched the movie on one of KLM’s planes parked in a hangar.

“While the movie played on the airline’s seat-back entertainment system, airline crew got busy outside the aircraft launching smoke machines, blasting streamers and even creating a rain storm. Essentially, the tiny passengers experienced everything that the film’s main character Dusty did.” [1]

From the reciprocity principle, the company may hope that providing this brilliant experience for the children will result in them choosing KLM over other airlines in the future. Whether one believes that the campaign was just a marketing ploy, one thing that most of us can agree on, is that KLM has invested a great deal of its resources into increasing its brand awareness among consumers of all ages, and certainly has achieved customer excellence.

Blog Source: [1] http://www.brandchannel.com/home/post/2013/10/11/KLM-Disney-Planes-101113.aspx

Disney’s Planes: spectacular pre-screening on board of a KLM plane

With the prevalence of Internet and social media usage these days, it’s no wonder that unethical marketing practices have led to a plunge in sales for Britain’s GlaxoSmithKline Plc. The research-based pharmaceutical and health-care company is accused by Chinese police for bribing doctors to prescribe its medicine to patients in hospitals even in situations where it may not be medically essential. The vulnerable group are the patients who may be in desperate situations, and put their trust in the doctors who have reputable status in society. While access to effective preventive and treatment medicine is evidently beneficial, the increasing sales as a result of direct-to-consumer advertising should not be the main objective for these companies. Rather, these companies should promote its drugs through concentration on the educational purpose of these ads. Most developed countries, such as Australia have banned direct-to-consumer marketing of prescription drugs. The problem with direct-to-consumer marketing lies within the quality of information transmitted through the ads and the extent to which they may inappropriately influence consumer demands, to want a drug that may not be necessary.

This scandal has not only caused damage to GSK, but has hurt the entire pharmaceutical sector in China with an evident dent in sales. Disturbingly, this is not the first time that the company has been entangled in an unethical marketing scandal. In 2012, the company paid a fine of US$3 Billion to settle charges of inapt promotion of antidepressants and failure to report safety data about a diabetes drug [1].  The ongoing scandals lay emphasis on the multitude of ethical challenges of globalized drug development and the dire need for corporate integrity in this industry. This discussion triggers a question surrounding how prescription drugs should be treated in the marketing environment, as it is clearly not a typical product on the market.

Sources:
1. China’s pharma scandal and the ethics of the global drug market

2. Analysis: Bribery scandal dents Big Pharma sales in China, GSK hardest hit

Photo Credits:
http://www.reuters.com/article/slideshow/idUSBRE98H07620130918#a=1