17Nov / 2013

The Yelp Wars: Yelp Liars Caught

A New York sting operation caught businesses paying for positive ratings on recommendation websites.

The “Operation Clean Turf” caught 19 different companies that were getting paid by small businesses to write fake reviews. These companies were fined a total of $350,000, proving that fake reviews are deliberate attempts to mislead consumers.

I believe that when businesses are not successful in getting enough customers, they turn to this last resort, hoping that their sales will increase by making fake reviews on Yelp. Majority of people rely on online rating websites such as Yelp on debating whether or not to utilize the business’s products or service, therefore when these business owners get desperate, in my opinion, they will use fake reviews since they know that this is most efficient to attract customers.

OwnerListens Mobile App

Another issue was that businesses were losing incredible amounts of sales and customers because of the numerous negative reviews that were being posted on Yelp. Angry customers were using Yelp to express their dissatisfying experiences with the businesses. Therefore, OwnerListens, a mobile app was created to establish a direct line of communication between business owners and their customers. By connecting with angry customers before they “yelp” and by listening to their concerns, you can really make these customers your biggest advocates.

Photo Source: http://tech.fortune.cnn.com/2013/09/26/yelps-fake-review-problem/

http://a4.mzstatic.com/us/r30/Purple/v4/b0/1c/b1/b01cb136-a354-ddbe-281b-6afe590f64ec/screen568x568.jpeg

Source: http://tech.fortune.cnn.com/2013/09/26/yelps-fake-review-problem/

http://www.entrepreneur.com/article/228308

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17Nov / 2013

China’s Gold Fever Surpassing India’s Love For Gold

Demand for gold in China is surging despite slower economic growth.

China surpassed India by purchasing 798 tonnes of gold this year. Urbanization and rising wealth are driving demands as Chinese consumers show no sign of curbing their spending habits. More and more people are investing in higher carat and heavier pieces of gold jewelry since gold is a secure haven of wealth and protection against inflation. However, this is simply promoting “gold hoarding”, predominantly by women, since Chinese “aunties” lead the charge, depleting inventories of jewelry stores.

However, China’s hunger for gold triggered speculation about reserves. Investment analysts are suspicious that the Chinese government are increasing their gold holdings as part of their foreign reserves since the Chinese government rarely releases comprehensive data on gold imports or holdings. Also, the main conduit for gold to China is gold imports into Hong Kong, therefore gold prices notably rose an average of 10% yearly over the past decade.

Hong Kong Bullion Imports vs. Gold Prices, 2008-2013

In the future, since demand will exceed the gold supply, I predict that the price of gold will skyrocket even further. Just like the gold smuggling that resulted in India after the new tax was imposed on gold from 4% to 8%, I believe that it may possibly occur in China also.

Source: http://money.cnn.com/2013/11/15/news/economy/china-gold/index.html?iid=SF_BN_River

http://blogs.wsj.com/moneybeat/2013/10/10/chinas-hunger-for-gold-triggers-speculation-about-reserves/

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17Nov / 2013

A Second Shot For Second Cup

Second Cup Cafe Launched in Pakistan

Second Cup, a popular Canadian coffee franchise, constantly threatened as an American coffee franchise, Starbucks, expanded rapidly causing many Second Cup locations to shut down on its own turf. For the first time, Second Cup has found that it had a better advantage over their greatest competitor. With North American coffee culture gaining popularity in Pakistan and by being a Canadian company, Second Cup was finally able contribute to the Pakistan fast food boom by expanding internationally and opening up their first cafe in Pakistan. Due to the anti-American sentiment in Pakistan, Second Cup could expand into this country without the negative political associations that goes hand in hand with being U.S. multinational.

In my opinion, expanding internationally is a great benefit factor over other competitors however it is also viewed as risky especially since Second Cup is planning to launch 20 more locations in Pakistan itself. For a better result, Second Cup should analyze the popularity of their products by observing their first franchise store and make a decision to open up more locations in Pakistan based on their analysis. By utilizing the lean-start up for the opening franchise stores, they could have safer and more successful openings.

The Lean Start-up by Eric Ries

Photo Source: http://www.canadianbusiness.com/companies-and-industries/a-second-chance-for-second-cup/

http://howtowriteabusinessplan.com/wp-content/uploads/2012/07/lean-startup-info-graphic.png

Source: http://www.canadianbusiness.com/companies-and-industries/a-second-chance-for-second-cup/

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17Nov / 2013

Yahoo Adopted One Of Microsoft’s Worst Ideas, Just As Microsoft Killed It Off

Link: https://blogs.ubc.ca/kathyhuang/2013/11/13/why-common-sense-is-not-always-common-action/

Microsoft has finally ended the infamous HR policy, the “stack-ranking” system that ranked employees on a curve and those who were on the lower end would be fired. Every Microsoft worker expressed that the stack-ranking system is the most destructive process that only caused resentment and distrust among employees since employees become overly competitive with each other rather than cooperatively working as a team.

However, Yahoo’s CEO, Marissa Mayer, adopted this abandoned strategy for Yahoo causing fear in many workers. Managers of Yahoo were asked to rank their employees on a curve, resulting to more than 600 people being fired just in the past few weeks.

Commenting on my classmate, Kathy Huang’s post on this issue, I agree with her idea that encouragement would be a better method for improved performance. However at the same time, in my opinion, I think it’s crucial for Yahoo to eliminate the dead-weight employees who are not beneficial for the company therefore this ranking system may seem harsh but it effectively reveals which workers are unproductive. However, the system will only be effective if the method is correctly balanced and also ensures the safety of the best, productive Yahoo employees.

Photo Source: http://www.rightattitudes.com/blogincludes/images/20060927_bell_curve_forced_ranking.png

Source: http://theweek.com/article/index/252723/why-did-yahoo-adopt-microsofts-failed-hr-policy

http://www.huffingtonpost.com/2013/11/12/marissa-mayers-latest-hr-_n_4260762.html

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16Nov / 2013

Peapod Who? Online Grocer Shows Amazon and Walmart How It’s Done

Link: https://blogs.ubc.ca/brandonkothe/2013/10/31/first-walmart-now-amazon-looking-at-buying-groceries-online-in-canada/

Walmart is keeping their eyes on Amazon as Amazon launches an online grocery service, following the footsteps of Walmart. Amazon’s entrance has created an even greater competition in the already crowded market. Commenting on my fellow classmate, Brandon Kothe’s post, I disagree with his perspective that Amazon has the greater advantage than Walmart in this business.

In my opinion, Peapod could potentially be these giant retails’ greatest competitor. Peapod is an Illinois-based online grocer that had been doing business with the residents of Midwest and East Coast of the United States for over 20 years.

Considering that Peapod began in 1989, the company has already gained regular customers and established firm relationships. As a result, due to past purchases and out of loyalty, I believe that customers prefer to remain with the service they are familiar with and trust. More importantly, Peapod has more experiences to understand the ups and downs of the business as an online grocer and has already found success on mobile since 30% of Peapod’s orders come from their efficient mobile app. While Walmart and Amazon are just starting to see how tricky an online grocery business can be, Peapod has already figured it all out.

Peapod Mobile App

Photo Source: http://i4.peapod.com/c/VG/VGH7T.jpg

http://www.appscout.com/images/PeapodMobile_DetailsDelivery.jpg

Source: http://news.cnet.com/8301-1023_3-57610511-93/peapod-who-online-grocer-shows-amazon-walmart-how-its-done/

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16Nov / 2013

Loblaw To Buy Shoppers Drug Mart For $12.4 Billion

For $12.4 billion dollars and Loblaw shares, Loblaw purchased Shoppers Drug Mart to fulfill complementary business by playing on each other’s strengths rather than competing and cutting into each other’s market share. Although Loblaw’s share of the pharmacy market is 5%, adding Shoppers health products and services to its grocery stores implies that there will more choice, more offerings, more deals and more convenience. However, the two main concerns that were brought up by Shoppers’ customers were, what will happen to the Shoppers’ membership reward points and will Shoppers’ price increase since Loblaw is more expensive than Shoppers. Loblaw ensures that by this merging, better deals will be available by integrating the companies’ loyalty programs and Shoppers will keep its name. Regarding that Loblaw, Canada’s largest grocery retailer, has finally made its move into the pharmacy market by merging with Canada’s biggest pharmacy chain, in my opinion, Loblaw is becoming more of a monopoly since it has achieved attaining all of the biggest retailers. Going forth I would recommend that by this integration, Loblaw should gain a vast knowledge about consumer’s buying habits and provide economies of scale for a greater profit.