Yu Qiu's Marketing Blog

I read one post on James Brown Marketing blog about “Understanding the Psychology behind Buying”. He states that the two most important elements behind purchasing are emotions and logic. For example, the reason that a customer buys a luxurious car can be willing to get the envy feelings from others, or logically realizing the purchase is worth the investment. Well, the example here simplifies buying process with two extremes. What I think is that the two elements should be associated together to influence customers’ purchasing in most situations. Most people’s purchasing behaviors depend on their incomes. With a limit budget, customers will balance their buying powers from emotions to logic. For contract, if the person is not interested in buying the product at all, the budget and price could not be factors that influence his/her purchasing decisions. Therefore, how to position a brand and target a market with reasonable emotional and logical factors is what markers should be considering. Also, Brown mentions about the importance of believability. It is true that customers will not buy product from you without trust, even if the products are valuable. This is also related to emotions and logic because customers can be personally feeling close to a product or recognizing outlook of a product. Using significant promotion is helpful to gain brand awareness and make the products be trustworthy. Again, knowing what customers really need and want is the most important point to keep it in mind.

I am a kind of person who would be attracted by creative design and cute packaging. Sometimes, I even buy a product without knowing what is inside of the package because the design of package is really aesthetic. After I studied marketing this term, I realize that packaging is a big deal for a product. Tiffany Mah’s recent blog post communicates a similar perspective as I do. She mentions that “the packaging is so important – and makes a difference in the motivation of the buyer”. It is approved in my case. Some customers would judge a product’s quality by its packaging. For example, between two bags of coffee with same quality, if they are both unknown brands, consumers would probably buy the one which has better and more attractive package. Moreover, packaging has two types: primary packaging and secondary packaging. Both types can have marketing use to gain more sales and new customers. Let us say Mac air.  Except for Apple product’s high quality, the unique fashioned designing of Mac air make it stand out in the intense competitive PC market. This is the use of primary packaging. In addition, the Mac air case is designed as a paper folder which impressed me when I first saw it. The using of secondary packaging also helped to promote its product. Tiffany also mentioned a kind of tea bags designed as hangers. It is creative to advertise tea with a unique packaging. I found a similar ad online which promotes the GreenBerry Tea. The tea bags are designed as birds which will fly when they are putted in water. Here is the poster.

Since 2006, the economy hotel industry in China has grown rapidly. Many local brands, such as Home Inns, Motel 168, GreenTree Inn Hotel, 7days Inn and Hanting Inns, gained lots of market share. The reason behind the huge success of China’s economy hotel industry is finding the right target depending on China’s economy pattern and Chinese people’s value. Comparing to West countries’ hotel operating modes, China’s hotel industry focuses more on “cost leadership” strategy instead of “differentiation”. Western hotel owners are more likely to establish its brand of high value, good service and luxury step by step. By contrast, the economy hotels in China tend to gain much more market share to achieve economy of scale by expanding their companies as quickly as possible. On the other hand, the type of consumers in China are different from customers in west countries. Many people in China usually book hotel rooms for business travel, either individual traveler or hotel cooperate contractors. Those customers look for standardized hotel services with a better price and performance ratio because of limited budget from their companies. The price and service level from economy hotels can fully satisfy these consumers’ needs and wants. Moreover, most economy hotels encourage new entrants without joining in contract fees. This expanding strategy helps the economy hotel market to grow faster.

Here are some websites of economy hotels in China. If anyone gets a chance to travel to China, you can choose one from the list I suggest. The utility will be much higher than you think of.

Home Inns, Motel 168 (sorry, no English version), GreenTree Inn Hotel, 7days Inn , Hanting Inns, Jinjiang Inn(English version will be available soon), Orange Hotel(my favorite)

Yesterday, I visited Claudia Chung ‘s blog. I found that Claudia’s recent post of “Celebrities…as BRANDS” was different from the usual point of view about branding. I agree with her about the “celebrities are actually trying to brand themselves”. Because my roommate is really interested in a Korean pop star, I often hear a lot about how is the Korean music and entertainments market like. For example, the largest Korean talent agency “S.M Entertainment” tried a lot to brand their celebrities for the last 15 years. They have successfully produced many famous singers and performers. Some of those pop stars were also introduced to Japan, China and Singapore. S.M.E wanted to gain more market share through global base. Over all, the company did a really good job on promoting and positioning their celebrities by matching the value to each target market. The brand of each singing group or individual, even for the entire company, is relatively strong within a certain interval. Why did I just say “within a certain interval”? Well, if you try to search for those celebrities, you will find that some of them are no longer belong to this group. It is a serious problem on the sustainability of a brand. Here we assume celebrities are different brands. They should be competitive and differentiated to stand out. However, some of them cannot be accepted by the market, or accepted at first, but be forgot eventually. Dealing with actual people is way harder than branding simple product or service. They are human beings. They are emotional and changeable. The company cannot expect that anything added on them would all be accepted. It is not like branding products. The producers have to consider any reasonable reactions that the brand itself will make.

Just for fun, I added two vedios about the S.M.E 2008 global Aduditions. Maybe it can show that the S.M.E really wants to expand its market share to global.

As one of the worldwide brands in Japan, Hello Kitty, produced by Sanrio co., is not only a fictional character representing cute and lovely for kids. Many people, including adults, value it as a life style and a significant attitude. Every year, there are many new fans join the large group crazed for Hello Kitty. Most Asian countries, such as Japan, China, Korea, and other western countries have their own Hello Kitty market. The picture below shows a Hello Kitty Store in Madrid, Spain. 

The wide expanding and global influences increase the Hello Kitty trademark to “worth more than $1 to $5 billion annually” (Wikipedia). To spread its market share, the Sanrio co. authorizes the Hello Kitty trademark and figure to some powerful company to work as strategic partners. They are either brand licensing or co-branding with other brands. Most of those actions are win-win cooperations. As I mentioned in my previous blog, M.A.C introduced a limited Hello Kitty edition into the market. Moreover, there are Hello Kitty themed hotel, hospital and airplane appearing in the market. For example, in October 2005, the EVA Airways, a Taiwan based airlines, created a “Hello Kitty Jet”. Everything on the airplane is decorated by pink and the Hello Kitty figures. For those of you who are fans of Hello Kitty, it is a good experience to fly with Hello Kitty.

Furthermore, Hello Kitty is used to witness love and happiness. Some couples are willing to host a Hello Kitty themed wedding.

 Also, in 2009, the fist Hello Kitty wine was introduced on the market. Over all, Hello Kitty is more likely to be a fashion vane throughout all generations.

I upload two videos to show you the Hello Kitty hospital and hotel.

Since smart phone have been introduced into the market, many people update their cell-phones more and more often. The rapid development of smart phone and internet technologies grows other industries. As social media being popular, young people are more likely to use their smart phone to check on facebook, msn and twitter instead of browse on computer. On the other hand, paying by phone is another advantage of using smart phones today. I t also expands the industry of e-commerce and changes the way and style of people’s shopping.

For now, cell-phones are not only used for long distance communication, but also a tool for seeing the world from a different point of view. The competition within the cell-phone industry is pretty intense, and each company updates their products so quickly to satisfy demand for new technology. Some companies try to follow up each steps that other big companies take. For example, Apple seems to be the leader of touch-screen smart phone; however, other cell-phone companies, such as Nokia, Samsung and Google, quickly copy the touch-screen technology and produce their own version. On the other hand, although smart phones contain many other functions, most people do not use them efficiently. The target market should be spread to satisfy most people’s need.  

“Fast fashion is a term used to describe clothing collections which are based on the most recent fashion trends presented at Fashion Week in both the spring and the autumn of every year (Wikipedia)”. Making it easier to understand, I interpret the term of fast fashion with 3 Fs: fast manufacturing, fast selling, and fast updating. In others words, customers can purchase clothes with the most recent fashion styles at a low price. That must be an excellent deal for young people, who are interested in new and diverse things. The list below includes most fast fashion brands.

• Zara
• H&M
• GAP
• Topshop
• UNIQLO
• Armani Exchange
• Abercrombie&Fitch
• Forever 21
• Urban Outfitters
• MUJI
• Comme ça ism
• C&A
• American Apparel
• Aeropostale
• American Eagle Outfitters
• United Colors of Benetton
• Next

As we see, there are a lot fast fashion brands already sharing Vancouver’s fashion market. Among these brands, Zara and H&M are the most popular two. Both brands have a large turnover rate for their products and seasons, which let customers follow the current fashion trends. On the other hand, it can be a market strategy as well. The fast updating of clothing makes Zara and H&M sell their products with a full price during short interval of each set. Moreover, those fast fashion brands do not limit to any targets. To do so, they make their images and products fit for many young, smart and fashion males and females.

During the last 3 years, fast fashion has been rapidly developed in Chinese market. Zara, H&M, Forever 21, UNIQLO, etc are more popular than other clothing brands among young people. As a Chinese, I am wondering that if China is able to “copy and paste” this new shopping style and marketing strategy into the Chinese fashion industry. How long the growth can last is another point to think about.

As one of the global makeup brands, the Makeup Arts Cosmetics (M.A.C) is famous for its colorful, creative and qualitative products. Initially, the company promoted its products by giving makeup artists cosmetics to be used on models and actress. A good product self is an excellent promotion. Now, MAC is more popular between young ladies and teens. The reason of the switch of target market is the different marketing strategy which reflects a broader MAC.

Frequently, MAC uses well-designed, colorful and unique flyers to give customers a visual impact. It works to gain new customers between students and younger age buys. Moreover, to be competitive, MAC cooperates with other brands or celebrities to introduce some seasonal limited edition, such as Hello Kitty collection and Viva Glam Gaga and Cyhdi. Personally, I am a fan of both Hello Kitty and Lady Gaga. I actually bought these two collections from MAC. Those were strong advertisings and marketing strategies to increase MAC’s market share because there are definitely many girls just like me. On the other hand, the Viva Glam, what I mentioned earlier, is a program that “support men, women and children living with and affected by HIV/AIDS globally” (MAC website). MAC was the first cosmetics company who integrated charity into sales. It is not just charity. Running promotion and increasing reputation for MAC are behind that simple action.

In addition, MAC always supports young and new makeup artists to develop their career. The company has a special membership program for students who are attending “an eligible school or institution of Makeup Artistry or the Performing Arts” (MAC website). Students can have some opportunities to build a relationship within MAC. It might be a great way of promotion by creating its own professional work team.

See more one M.A.C website: http://www.maccosmetics.com/

Before I came to Canada, I thought every KFC’s restaurant is the same with red and white wallpapers, and all kinds of yummy food. However, when I went to the KFC store in Metrotown, I did not see any egg tarts, mashed potato, egg and vegetable soup that I can get in China. With a same KFC brand, why the products are so different between China and North America?

I think it is because of the localization marketing strategy used in the Chinese market. Facing the threats from McDonald’s and other restaurants, KFC makes its products more preferable to Chinese people’s taste and provides new flavours and items, such as egg tarts and Mexican twister. The new eating style helps KFC gain more market share in China’s catering industry. On the other hand, KFC China spends lots of money on promotion each year. The two pictures above are examples of KFC’s coupons. Price is often used as a tool of promotion. Sometimes, KFC will host a competition or invite celebrities to do promotion. TV commercials are common. Moreover, for its places, KFC first chooses large cities, such as Shanghai, Beijing, Hangzhou, to open its restaurants, and then expands its business to other cities. KFC China notices that the huge purchasing power in large cities is helpful to establish its localization. Overall, KFC China is trying to develop its chicken empire with other sidedishes popular in Chinese eating preferences.

Since the Chinese catering industry has been rapidly expanded for the last decade, there are many other restaurants appearing to threaten KFC’s market share. To be more competitive, KFC China introduced a new serving of chicken rice bowl to the market. There is a video I found on Youtube. Hopefully, it can give you some ideas about KFC’s new trend.