This is my blog about marketing!

http://markrburton.wordpress.com/2010/03/04/the-innovators-pricing-dilemma/

In Mark Burton’s blog “Pricing on Purpose” there is a post titled The Innovator’s Pricing Dilemma that talks about specifically about a new line of IBM servers that are very efficient and can save a company a lot of money but they cost a lot more than the competition. The main point of the post was to discuss how should innovators price their products, which I thought was very interesting.

I believe that if a company creates an innovative product, like IBM’s new eX5 servers, they should not look at what their competitors are charging for products in the same category. An innovation is something that is different than the normal set of products, it has some unique set of features that allows the customer to complete a task more efficiently and in the case of the eX5 servers save a lot of money so it should be priced differently. In most cases innovations are priced higher because of the unique advantages they offer. So, I think its fair that IBM has priced their product so much higher than competing brands, when you want the most premium product on the market such as the eX5 server you must be willing to pay a premium price.

If you look at most new innovations they often use a market skimming pricing strategy. For example, when a new iPhone comes out the price is very high but as the months ago along the price is dropped slowly so that more and more customers can buy it. I believe this could also be very successful for IBM’s servers, at first they could charge an extremely high price for their product but as time passes they can drop the prices. Eventually they could release a second version of the eX5 server and start the same process again.

In the end I believe that pricing should be set on the basis of what the product offers. If the product is the best one and offers the most features on the market it should be priced with respect to that not looking at what the closest competitors are charging. Companies need to communicate why their product is superior to competing brands and if this is done effectively customers will pay the higher price, which is what value-based pricing is.

In Arman’s blog post (https://blogs.ubc.ca/arman/2011/09/22/mcdonalds-new-marketing-strategy/) about McDonalds he talked a lot about the way the company was trying to change its image to a healthier one both to keep existing customers but to new gain ones as well. Recently, while reading in the textbook I saw a chart that showed McDonalds ranks number six in terms of brand equity of all companies in the world. So, it makes sense that McDonalds would want to start to offer more healthy alternatives because of the growing number of health conscious people to protect and keep their brand relevant to potential consumers.

It does not surprise me that McDonalds ranks in the top ten on this list because they are everywhere and their restaurants always seem to be busy. The McDonalds brand itself has become so powerful and influential that its value may just be greater than all the tangible assets of the company. McDonalds often puts on very large marketing campaigns and they sponsor various events, such as the Olympics, not only because they want people to come to their restaurants but to keep people aware of their brand in general.

McDonalds has positioned itself on more than just the benefits of going there but also on their benefits and beliefs and values. The benefit of going to a McDonalds restaurant is that you can get your food very fast and be on your way in minutes. Recent TV commercials I have seen from McDonalds have been more than just about the food but about connections between people. McDonalds knows that in order to position their brand effectively in target customer’s minds they have to posit ion themselves on more than just the benefit of going to them but the fact that connections with special people in customer’s lives can be made at their restaurants and families can spend time together. Overall, I see the McDonalds company being very successful for a long time to come because they have put so much and continue to put so much effort into their brand.

https://blogs.ubc.ca/aaronbae/2011/09/25/comm-296-blog-assignment-2/

In his blog Aaron Bae talked about the ongoing rivalry between Apple and Samsung. These two competitors have made their fight against each other very public with both trying to seek bans on the others products in various countries around the world. Aaron talked about the two companies battle for the tablet market but another market they are very much trying to win over is the smart phone segment.

One of the most frequently asked questions by people who are looking to buy a new phone is should I buy a Samsung or an iPhone. The battle between these two companies has been often referred to as a “war.” The recent lackluster and disappointing release of the iPhone 4S has opened the door for Samsung to try gain more market share of the smart phone market. This clearly was still not enough, Samsung has now decided to try to have the iPhone 4S banned in France and Italy for infringement claims.

This rivalry is very fascinating to watch and is taking competition to a whole new level. They are not only trying to out market and advertise each other but now they are trying to use legal technicality’s to gain market share.

Something that is quite interesting is that despite the ongoing clash between the companies Samsung is still the supplier to Apple for its screens on both the iPhone and iPad. Since now Samsung has the opportunity to gain some market share especially with the dissatisfied iPhone hopefuls Samsung may decide soon to stop providing screens to Apple despite the very large revenue this transaction makes for their company. This next year will be very interesting specifically because now that Apple has released its iPhone 4S and Samsung is getting ready to release the new Nexus S and Galaxy smart phones.

In the last few years GM has completely overhauled their company in a new direction. After the 2008 recession many people questioned GM’s ability to come back, they shut down a lot of their companies, and looked like they were going to continue to fall and lose market share to various Japanese automakers. One of the main reasons people were leaving GM vehicles was because of their unreliability, lack of features, and most importantly horrible gas mileage. During the 1980’s and 1990’s gas mileage was never a concern but with the rising crude oil prices in the 2000’s this was now the most important factor for many people when looking at a new car.

Lately, GM has been making very large strides to change their company’s direction to appeal to their target market and produce some of the most reliable and fuel efficient cars in the world. The new 2011 line up of Chevrolets is stunning and you can tell are a part of the new refined age of GM. My favourite Chevrolet car is still the Corvette but the two that stand out to me the most are the brand new Chevrolet Volt and Cruze. Both these cars, to me, show how GM is trying to re-position their brand.

The Chevy Cruze ECO is affordably priced, offers a ton of new features, and most importantly gives 42 highway MPG, which if you don’t know is amazing! The Volt is an electric car that runs both on electricity and gasoline, when needed. You simply plug the car in at the end of the day and let it recharge for tomorrow.

I think the steps GM is taking are already working, I see a ton of midsize GM cars again and people are seriously considering them when purchasing new vehicles.

Here are two TV commercials for both the Chevy Volt and Cruze that make a point of their great gas mileage:

https://www.youtube.com/watch?v=f_Ee_XdRZyE&feature=youtu.be

https://www.youtube.com/watch?v=6UAQaTuftM8&feature=youtu.be

Hey Comm 296,

Welcome to my blog about interesting things in the world of marketing! My name is Suneil Bains and I’m a second year transfer student from SFU. I’m taking this course for a few reasons the first being that I have to since it is a required second year course for a Bcom student. The second more important reason is because I believe marketing is a key part of any successful business. Whether you work for an already established company or are starting your own business you must know how to properly market the firm by keeping it relevant to your target market. Some of the companies that I like and can think of such as Apple, Mercedes-Benz, Nike, and Coca-Cola, just to name a few, have been extremely successful not only because they offer great products but because of there abilities to market themselves. These companies have been able to constantly reinvent themselves as times change through various forms of advertisements.

My personal favourite ad was a Budweiser beer TV commercial that I think a lot of people will remember and have probably seen, I will post the link at the bottom so you can watch it. The ad was extremely popular at the time and had everyone, not just beer drinkers, talking about it.

http://youtu.be/UDTZCgsZGeA

In my spare time I play various sports and do just about anything that can get my heart rate up to stay active. I also like cars and have often been called “obsessed”, I have a very large number of model cars because I used to collect them when I was younger. I consider myself pretty outgoing so I look forward to meeting some of you guys and learning more about marketing!

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