Response to Yan Rong’s post: Cannot Think About any Point of Difference for Products? Think About Services

Personally, The Four Seasons already distinguishes itself from other lower-end and middle-end hotels. Its luxurious property serves as a points of difference, besides the seemingly “extra” customer service that is provided. I am extremely fascinated and amazed by the level of customization that is offered: the level of care which is provided to the customers. When the hotel even takes the click of a hotel door into consideration, its cost must be high, no matter in terms of the fixed cost, such as the cost of equipment and furnitures provided, or the variable cost, like the salaries paid to its workers. But as long as it’s making a decent profit, it’s a good business model to follow. All in all, I wish you obtaining an opportunity to live in The Four Seasons one day:)

Response to Hang Yin’s post: Factors lead apple to success

Besides what you mentioned, I personally regard the marketing strategies of Apple extremely successful, compared to previous years. In regards to iPhone 5s, especially in the colours of gold and silver, it’s exactly what Chinese customers are dreaming of. In terms of IOS 7, although it fits well for iPhone 5S, it has brought many troubles for iPhone 4, even iPhone 4s users, who have consistently reported that IOS 7 does not go well with iPhone 4, not even some iPads.

Another idea I want to raise is that despite the success of Apple, Samsung has still been the leading seller in China, because customers not only trust and need its smartphones, but also its headsets and lower-end phones due to the recognition of the brand. Nonetheless, it’s always been a dilemma for iPhone to produce some lower-end products, thus iPhone is losing the market share of lower-end and middle-end products, which makes it difficult to catch up with the over a hundred percent growth rate of Samsung simply by introducing new smartphones such as iPhone 5S and 5C.

Response to external article: http://www.forbes.com/sites/theapothecary/2013/11/18/do-you-like-your-doctor-obamacare-drives-unitedhealth-to-downsize-its-medicare-physician-networks/

Personally, I like the article, but not the measures that is taken. Since Medicare is going broke as obamacare cuts $716 billion from Medicare to fund itself. Medicare serves vital function to citizens and workers as well, thus one cannot weigh Obamacare over Medicare. Two should be treated equally.

the tenth post is embedded in the “older posts” tab at the very bottom of the blog since the main page runs out of space. Sorry for the inconvenience 🙂

Facing competitions from chains such as Chipotle, Subway and Five Guys, McDonald’s intends to offer its customers more options with their orders, thus creating a little room for the customers to customize their orders.

To test the possibility, a “build-your-own burger” concept has already been applied in Laguna Niguel, California, where customers pick their favorite toppings. At the same time, McDonald’s also expands its Dollar Menu to five sandwiches with a variety of toppings and sauces. To MacDonald’s, customization is another great opportunity to foster growth.

Customization is made possible by new “assembly tables”, which improves both speed of services and more ingredients accommodated. Product customization is the idea which is mentioned and briefly explained in class. When a product is customized, it fits more in terms of customer preferences, particularly for those in their 20s and 30s, who regard customization as a strong attraction.

However, product customization may negatively impact the fast speed of service, which has been a larger issue for McDonald’s. Quicker speed of service not only increases the level of output and customers circulation, but also decreases the levels of inventory. Indeed, it’s too early to determine whether “build-your-own burger” concept fits McDonald’s or not.

Hyperlink: http://www.ctvnews.ca/business/mcdonald-s-tries-to-boost-sales-by-letting-people-customize-their-burgers-1.1545620

Starbucks Corp cannot stop “Charbucks”, a family-owned New Hampshire roaster from selling coffee, because the circuit judge states that Starbucks failed to prove if this “blurring” of Starbucks would confuse consumers.

Charbucks is recognized as only weakly related to the ” Starbucks trademark.” Nonetheless, for Starbucks, their association is much stronger. This is mainly demonstrated by a phone survey of 600 people. Majority people associate the name “Charbucks” with the brand “Starbucks”.

The conclusion is rejected later on, stating that while some participants think of “Starbucks” when hearing “Charbucks”, only 4.4% agrees that “Starbucks” sells “Charbucks” product, which demonstrates that two are only minimally similar.

This case is very interesting, since it demonstrates the importance of brand, which we learnt in class. Brand identifies one seller’s product different from those of other sellers. International companies, as well as companies which sells premium or luxury products, often file trademark lawsuits even against small rivals, in this case, “Charbucks”, a small and family-owned business. One of the main reasons is that the reputation of “Starbucks” might be damaged, which worth billions.

Another interesting point is the dissimilarity between how the different products appear in commerce and are seen by consumers.

Hyperlink: http://www.torontosun.com/2013/11/17/starbucks-loses-charbucks-appeal

Instagram announced to 150 million users of their Ad plans on streaming four months after the video was introduced. It is said the ads will be introduced slowly. According to the company, “Ads will be images and video, carefully curated”.

Taking the advantages of this newly introduced plan, brands such as Burberry and Levi’s take their first step to be the advertisers, in the hope of reaching an even broader and larger range of users.

Although Instagram promises that brands of the ads will be familiar to the community, and quality of the ads will be high, users are still annoyed. One user says, “This is when I seriously stop using instagram. Not that I use it that much anyways.”

The consumer reaction directly connects to the idea of change in consumer behaviour, which we learnt in class. More consumers may switch from tumblr and Instgram to Vine, which is Ad-free. The reason is linked with the concept of Feedback Loops: Word of mouth. Instagram used to have a positive word of mouth because it’s Ad-free, nevertheless, currently, negative word of mouth has spread, which triggers more serious consumer consideration and possibly change in consumer behaviour.

Video: Instagram Introducing Ads, as Promised

Hyperlink: http://adage.com/article/digital/facebook-reveals-ad-plans-photo-service-instagram/244563/

With the help of new management team and a greater variety of products, Fashionandyou, an online fashion retail store, aims to double its quantity of daily ordering in the next 15 months.

Losing its market share, as well as visibility due to top-level exists last year, Fashionandyou learnt that it needs a different operations management, which I learnt from class. By appointing a new supply chain director, marketing director, chief technical officer, and head of customer services, the company is attaining more customization, as well as gaining better information from its customers.

In addition, the product category varies from traditional to more luxurious and featuring exclusive international brands, which as I mentioned, also results in more customization and better engagement on the site.

What is the purpose of these transformations? Besides doubling the quantity of daily sales, another intention, which is vital to all operating businesses, is to break-even. As learnt, break-even is the idea when a certain quantity of products is sold, the revenue will cover all the fixed and variable costs, which means that after this production level, Fashionandyou will start to earn profit, which is expected to happen in March, 2015.

Video: Starting Up – Fashionandyou.com – E – Tailing

Hyperlink:

http://economictimes.indiatimes.com/tech/internet/fashionandyou-rejigs-top-deck-aims-to-break-even-by-march-2015/articleshow/25942716.cms

After the first attempt was overturned, French parliament made its second attempt to impose a new tax on energy drinks which has caffeine and the amino acid.

In order to control the import, as well as the consumption of such energy drinks such as Red Bull, the world’s most popular energy drink, it is said in Reuters news, “tax of one euro per liter from next year on drinks that contain at least 0.22 grams of caffeine per liter, or 0.3 grams of taurine” will be charged, in the hope of increasing the health standards. Since researchers reported such energy drinks is capable of causing heart and other problems.

Using the SWOT analysis learnt from class, I find that Red Bull is facing threats not only from its competitors like Monster, but also the pressure from French government. Imposing taxes on Red Bull energy drinks is equivalent as putting a production quota on Red Bull’s export to France.

Originally, in 2008, Red Bull regained the opportunity to sell its product after being banned for 12 years due to health concerns, but five years later, this opportunity turns against Red Bull, and currently, it’s been a threat for Red Bull.

Article on Red Bull causing one death: http://www.digitaljournal.com/pr/1589057

Video: Red Bull spread their wings: new flavours and health risks

Hyperlink: http://uk.reuters.com/article/2013/10/24/us-france-energydrinks-tax-idUKBRE99N0LW20131024

The Body Shop is not only an international brand which sells body-care products, but its brand positioning and value proposition, two concepts that we have learnt in class, stand out.

Instead of using animal testing for cosmetic purposes, new means of testing for cosmetics for domestically manufactured ordinary products will be adopted by The Chinese Food and Drug Administration. This is greatly welcomed and supported by The Body Shop. The Body Shop is the first beauty company to be against animal testing for cosmetics.

The points of difference which separates The Body Shop from others such as Lush, is not only its products, but also the value proposition that is embedded. The Body Shop has been socially active and its founding message states against animal testing, which makes the corporation the most long-standing cosmetics company to take action on the issue. It also joins and supports Cruelty Free International’s.

Video: Happy Bunnies! Celebrating the EU Ban on Animal Testing for Cosmetics

Because of this “humanitarian” value proposition, The Body Shop positions its brand as highly ethical and “animal-friendly” brand. This helps The Body Shop distinguish itself from other competing firms. I would choose The Body Shop undoubtedly.

Hyperlink:

http://www.prnewswire.com/news-releases/the-body-shop-welcomes-the-news-reports-that-the-chinese-food-and-drug-administration-will-adopt-a-new-approach-to-animal-testing-for-cosmetic-products-231163541.html

Tim Hortons plans to expand its operations internationally. Its short-term goal is to continually learn and grow in the Middle East before furthering its international expansion in the long run. This expansion is an opportunity, as analyzed by SWOT.

Its target is clear. As stated, “this is not about plastering the Tim Hortons brand everywhere, this is about taking the brand where it makes sense and where we can further build.” Seemingly, Tim Hortons has a step-by-step plan to conquer the world coffee market. And the way to do so is to open up more chain stores or franchising, while knowing exactly who its target consumers are, which are the concepts mentioned in class.

However, the biggest challenge, the threat in SWOT analysis, is the fierce competition from Starbucks and McCafe, which offers a variety of products with different prices. Not only so, Tim Hortons falls behind in regards to its mobile app, “Timmy Me”, which customers cannot pay with. As high-tech app becomes the points of difference between Starbucks and Tim Hortons, it needs to develop high-tech products to not only catch up with Starbucks, but also create its own points of difference to minimize the threat.

In addition, focusing more on younger customers who demand more complex coffee drinks, and developing healthier options by providing more balanced choices will also become Tim Hortons’ main focuses.

Video: Tim Hortons expansion

Hyperlink: http://www.ctvnews.ca/business/tim-hortons-chain-looks-to-expand-across-the-globe-1.1532688

The arrival of iPhone 5s, especially iPhone 5s gold, brings Apple to the top five smartphone makers in China because of the shipment growth.

For the first time, iPhone released its latest iPhone 5s and 5c at their earliest in China. iPhone 5s, especially in gold which served as the main driver of growth, fits Chinese customers’ demand perfectly since Chinese people prefer gold to any other color. This is a case of almost perfectly targeted consumers, thus some even wish to purchase from China’s grey market with almost double the original price, whereas others wait for at least two to three weeks for the shipment.

Not only so, the inventory level of iPhone 5s is so low that supply does not meet demand, despite the increase in level of production. As for iPhone 5c, the prospect is still uncertain.

Despite the rapid growth of iPhone 5s, Samsung Electronics still makes the largest gains. While being famous for its Galaxy brand, many of its lower-end products, such as handsets and phones, attracts more demand because of the reputation of Samsung Electronics. This exemplifies the importance of a brand: Consumer directly relates high quality with any Samsung products, no matter whether it’s lower-end or not. Extensive retail channels also made this gain possible.

Video: Gold iPhone 5S selling out in China – China Price Watch – September 25, 2013 – BONTV China

Hyperlink: http://www.pcworld.com/article/2061400/iphone-5s-props-up-apples-market-share-in-china-but-samsung-still-leads.html

Although KFC is recognized as the best foreign fast food chains in China, it faces many promotional disasters. Promotion, the concept mentioned in class, usually carried out through means of advertising, sales promotion and publicity, is vital to the growth of any corporations.

The new marketing promotion, which halves the price of the family-sized bucket, is criticized. Consumers find themselves getting ripped off, since according to the online image, the half-price chicken (right) is not a deal: It is way less compared to the normal amount of chicken (left).

Thousands of posts spread across the Internet, featuring the way “KFC half price” chicken rips off customers. Even some news sources reports that “the half-price deal “tricked a lot of consumers into buying the bucket.” With no doubt, as the negative word of mouth spreads, consumers will take more serious consideration as whether KFC should be their first choice or not. This also demonstrates the possible damaging impact of social media such as Weibo to KFC.

Not only so, when two of KFC China’s chicken suppliers are involved in the scandal because illegal hormones and antibiotics are used for fattening the chicken, KFC stops all of its suppliers which are under investigation. But this did not do any good when H7N9 bird flu comes. Thus I urge KFC China strongly to foster its PR and marketing strategy, so as to minimize the negative effect of future dilemma.

Video: Antibiotics-filled chickens supplied to fast food restaurants like KFC CHINA

Hyperlink: http://www.ibtimes.com/kfc-china-promotional-disaster-yum-brands-company-criticized-ripping-chinese-customers-1450010