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Company Orientation
Posted by: tonyteng | November 1, 2010 | Leave a Comment
Today Tamer talked about company’s orientation. There are 4 types, sales, profit, competitor and customer orientation respectively.
I would like to give some examples and comment on each type of orientation.
Sales: It is mentioned in class that Starbucks are profit orientation so I guess Tim Hortons should be sales orientation. In fact, some of my friends find Tim Horton cheaper. But the trick lies on the size of their coffee. Primarily they are able to offer cheaper coffee because of their smaller portion of cup and meals. This gives the illusion that Tim Horton is quite cheap. Well, for moderate eater like me actually don’t find it fulfilling and worth value to eat Tim Horton. Well, this is a good strategy by Tim Horton. They sell their products cheaper but they are doing something with the size of coffee offered.
Profit orientation: I believe luxury restaurants are profit orientated. Especially those hot pots and expensive dine in place. They seek to maximize their profits. This sounds so economic actually! Haha. I know monopoly always do that. They sell less products but at higher price. Examples? Perhaps, expensive chocolates, Nike, iPhone. They always sell less than the market equilibrium!
Competitor orientated: Well, we always see about those price matches thing in Future shop, Best Buy and other big electronic shops like them. I wonder do they sell at the same price? The trick for them to have the price match thing is to sell different type of products. If Bestbuy only sells type A product (differentiated) which Future shop don’t sell, how are we as consumers going to compare the product price? A smart move right? If in economics, the price check (if you could find something the same with lower price) then they are willing to refund u. This is to keep other oligopoly from pricing above their agreed price.
Customer orientation: Well, I hate to admit it but Rogers is one of them (although I consider their phone service to be highly priced). They have a lot of packages offer to consumers. In econs, it is like price discrimination by segmenting your consumers to different groups then the supplier can maximize their producer surplus. They have different packages for different users, heavy users, students, business etc.
That’s all for now. So much economics in my blog. Maybe it is because of I got back the econ midterm today and finished my econ 355 midterm. Haha