Sunday, December 6, 2009

Reflections

I learned more about the overall process of finding an untapped need and making it into a product. In the majority of my marketing classes, the focus was placed on making a product and then marketing it to the consumer. I always sort of looked at this as manipulating the consumer into thinking that they need your product. This method seems like product pushing. The method we discussed in class while doing the project seems a lot more moral. It seems more like product pulling. If an item was invented around my personality that would make my life easier around the house, I would for sure purchase it. This method is more human centered than the method of marketing I am used to. I am glad marketing is moving in this direction. I do not want advertisements telling me that I need something. I do not like labels. Besides t-shirts, none of my clothes have writing on them. I do not want someone to know where I shop; I just want something that looks nice. Taking the time to develop a persona and find an untapped desire makes the labels less necessary. If this is done correctly, you are essentially developing an item that will sell itself without a big need for constant advertisement. The product would only need advertisement to get the word out, not to manipulate someone into making a purchase. The project gave me a much better insight into finding a need and building a product around it. Our group initially came up with an idea the first meeting because that is what we were conditioned to do. Of course, Professor Walls reprimanded us because that is not the point of this project. The project updates and feedback practically handed us the idea we used. Instead of creating something arbitrary, we developed something useful that I truly believe every bathroom of an elderly person should buy. The process made me understand that we have to fit a product to a need, not try to create a need around a product.
I really liked the expanded research methods that we used. I am a marketing minor, so I have not taken the Marketing Research class. This was the first time I had been exposed to certain research methods and how hard it is to find needs. I really liked the idea of looking to someone who does not use the product to find information. When the speaker came in and told us that she interviewed a toothless man when trying to market toothbrushes, I found the idea novel. We tried to incorporate this idea in our project by interviewing someone who has cared for the elderly and got some great feedback. I had also never realized the importance of catching someone off guard to find their true needs. In class, we discussed the perils of doing in-home interviews because everyone cleans up their space. If I were interviewed by a company, I feel like I would be honest about my shortcomings in eating habits, cleanliness, etc because I would never see the interviewer again. I do not inherently have a need to impress people about these things. When I thought about it more, I suppose I would cover-up really embarrassing habits that I have or just blatantly lie about them, especially if I was being interviewed with someone that I know in the room. I liked the tactics of separating a husband and a wife when interviewing. The discussion leading into the research portion of the project made me realize how rare these insightful nuggets of information truly are. The interviewer has to provide the right settings and set the right tone to get the right information. The portion on research was one my favorite parts of the class because it gave me a much better understanding of the marketing process. I think actually taking the time to do good research had a very positive influence on our project outcome.
When we were first presented the project I was not optimistic. I decided to minor in marketing because I thought it was interesting, like a live version of Freakonomics. To date all of my marketing projects have run together. I would rather read the material and listen to lectures with lots of examples. I was surprised that I did enjoy this project. I saw the necessity of making a project to expand on the ideas we learned because the process was so different from what I have been exposed to. The new process yielded a product that I was proud of. I usually think that I would never buy a majority of the products presented. These products seemed legitimate for their persona. Although our product was boring, it is perfect for our market. If we had not done the process of developing a persona, designing the research, developing a prototype, and getting feedback for the prototype, our group presentation would have been vastly different. We would not have taken the time to develop and cultivate an idea. We would have gone straight to a product that I would not have been as proud of. I thought the spacing of the product updates was good; it never seemed like too much all at once. I think a lot of college projects I have done would have benefited from more feedback. I appreciate that Professor Walls took the time to give us helpful feedback, especially on a project that was pretty open-ended. The groups were a nice size, enough for diversity of ideas, but not so many members that scheduling and social loafing would become a problem. My teammates were great. We worked together well and had no major disagreements. Everyone had constructive input and diverse ideas. I think the project was a valuable experience. We learned the material better by actually doing it instead of being tested over it.

Wednesday, November 11, 2009

You Tube and Google

For my blog, I decided to do some sort of YouTube sensation since YouTube has had a lot of videos shut down due to copyright infringement. I wonder if there is a correlation between the Old Gregg video (initially shown in BBC’s The Mighty Boosh) popularity and its availability on You Tube. Unfortunately, I do not remember the exact date that the video was taken off of You Tube. I can narrow it down to after May 2008. Today when I searched, I noted that the video has been put back up. Will there be a lull on Google’s Zeitgeist for when the video was unavailable and a rise when it was put back up?

According to You Tube, the video that is available today was officially added November 17, 2007. The original air date for the skit was August 23, 2005 on The Mighty Boosh. The entire video is twenty seven minutes, but the You Tube portion is only seven minutes. According to the Zeitgeist chart of Google trends over time, there is a spike in early 2006. Afterward, there is a huge lull in popularity until 2007. The trend steadily increases with a peak in late 2007 and another in late 2008. Afterward, there is a dramatic decline with two more substantial peaks in 2009. In addition to the graph, Zeitgeist Google Trends also has the search’s popularity ranked by country (Australia, then UK, then USA) and city (St. Louis, Edinburgh, and Atlanta). Interestingly Austin, TX is ranked fifth and Richardson, TX is tenth. English is appropriately the only language ranked.

When I searched Trends for Websites, I noted that USA is the largest user of Google. UK is fourth and Australia is not in the top ten. This does have a large impact on my research findings because it is a source of error when trying to rank the Old Gregg Video search by region. Not every country uses Google as its primary search engine.

Under the insights for search tab, I got a more detailed map of interest over time. It also shows the top search items. Old Gregg is officially spelled with two G’s, but if the search was narrowed to Greg with one G, the results will be skewed toward American regions since that is how Americans typically spell Greg. Also, “Boosh” was the number two related search. Most Americans know of Old Gregg through its You Tube sensation and do not relate it to The Mighty Boosh. This could also skew results. I can narrow the results per region and find research that is confined to Australia. South Australia’s search volume is high while the Northern Territory and Tasmania have low search volumes. I can relate this back to population density and the number of people who own computers for my research. It then gives the top searches in Australia. I could then narrow the search to a given sub region. In New South Wales, I found there was a spike in views in March of 2007 and a further spike in November of 2007. Since there was never a lull in Google searches, I am questioning whether the video was taken down in the first place, or if Old Gregg fans were visiting another sight to get their fix.

This type of information is very valuable for companies. A company can easily tell what is highly searched on Google. With the use of AdWords, the company can piggy-back on recent trends. Maybe Greg’s Car Parts can pay to advertise every time someone searches for Old Gregg. Another company could pay to have their commercial shown on Hulu before the Old Gregg content is played. This way a customer will associate the silly sketch with a certain type of hair product. This will subconsciously create good feelings every time the consumer hears about the product. This increases their customer experience with the product.

Showing the search pattern for each region can help explain regional patterns and yield customer insights. A popular You Tube video among a certain age segment can reveal the personality of the segment. Knowing the target’s sense of humor will help companies make suitable advertisements. Austin is a college-town, so it is safe to assume some of the students like the Old Gregg video. When marketing a certain beer to these students, it is safe to use dry humor and a silly theme since it is evident that these things go over well. Smirnoff tapped into the You Tube sensation when it created a skit revolving around its product. They probably saw that parody music videos are highly viewed by its target audience. The company generated its own parody video, which circulated through college towns. According to Google Trends on Zeitgeist, the searches for Smirnoff Raw Tea spike in late 2007, when the You Tube video was released.

There is a high correlation between You Tube and Google searches. What people are searching for gives insight to what people like. Marketers can use this insight to find the personality of a potential customer. They can also use the trends to target their advertisements to certain segments. Google Zeitgeist gives marketers a peak into the consumer’s mind free of charge.

Wednesday, November 4, 2009

Wal-Mart

Wal-Mart’s enormous database gives them a competitive advantage over other large grocery or supply stores. Wal-Mart has the ability to see correlations between seasons and purchases and items that are regularly purchased together. In doing so, they often tailor product locations, exhibits, and sales to maximize profit and minimize cost. This information also allows the store to maximize efficiency by only having the required number of employees working and keeping inventory at the desired rate. Customers come to Wal-Mart because of their inexpensive prices and their selection of in-stock items. This database of information serves as a competitive advantage. Wal-Mart’s efficiency fulfills these two basic needs of the customer. This keeps the customer returning. The database allows the store to go a step deeper than cheap in-stock items. It can suggest which items should be placed together or far apart in the store. Items that are always purchased together can be placed far apart so the customer has to look at and possibly purchase other items. Goods that have a correlation of being purchased together can be placed together. If a customer wants to purchase one of these items, the proximity placement will “suggest” the other item. “Knowing collectively what goes into one shopping cart” can tell managers a lot about the correlation of items and where they should be placed on the floor. This does give Wal-Mart a competitive advantage because their competitors simply do not have the resources or knowledge to place items as effectively. Customers entering Wal-Mart get the basic experience they are looking for, but the holistic experience is not quite there. Wal-Mart shoppers still have a bad connotation (as seen from sites such as http://www.peopleofwalmart.com/). People frequent Wal-Mart out of necessity and due to their prices, but it still has the reputation of being a less-than-classy establishment. If Wal-Mart’s mission statement is really “to help people save money so they can live better” then they are fulfilling the statement. The experience of entering a store and finding what you want and things you did not know you wanted is given to the patrons of Wal-Mart. Knowing exactly the items needed at what time does give Wal-Mart a competitive advantage.

The amount of information that Wal-Mart collects is scary but scarier is what the information has the capacity to reveal about a customer. Although they compile the information and safeguard it, they should not be able to take further steps in identifying individual customers. The article made is sound as if Wal-Mart has the capacity to find a customer’s credit rating but has no interest in doing so because it would not be profitable. The information they have about individuals can be easily obtained from elsewhere. The information they have about purchasing is invaluable because it can be used to predict trends. If Wal-Mart is doing an individual profile, they could get the information about that person through other avenues. I am not as worried about Wal-Mart compiling customer data, I am worried about it falling into the wrong hands. I know Wal-Mart has an intense system for protecting data, but hackers have gotten into more secure locations in the past. Getting that amount of information about countless individuals is scary. I trust Wal-Mart with the data because it is largely data that an internet search could find about an individual. Every employer has to have employees’ social security numbers on file. I have access to my entire sorority’s social security numbers as the Vice President of Finance. Securing individual data is a risk even if Wal-Mart does not compile it.

Wal-Mart is having a huge impact on their suppliers. I believe it is driving suppliers to increase their efficiency. If they do not supply Wal-Mart with the goods, someone else will. It forces suppliers to be competitive because they do not “run the show”. Wal-Mart works under a “supply and command” system that forces suppliers to do Wal-Mart’s bidding. Mistakes that suppliers make are no longer Wal-Mart’s liability. This will make the supplier feel the full force of their mistake and reduce the likelihood of it reoccurring. Wal-Mart is on the cutting edge of supplier-store relations. Wal-Mart demands efficiency for its business model. This trickles down to suppliers, which trickles down to producers, making the market more efficient as a whole. Without Wal-Mart pushing this, change would come about much more slowly. If one company cannot keep up with the change, another will be ready to take its place.

Wednesday, October 14, 2009

Creativity and Innovation

The website, www.steapandcheap.com is particularly creative and innovative. The tagline for Steep and Cheap is “One killer gear deal, one item at a time until it’s gone.” The website takes one outdoors-related item and sells it at a reduced price until the item is sold out. Once that item is sold, another item is up for sale. The sales are usually 40-80% off original prices for quality outdoors gear. Examples of gear up for sale are Marmot jackets, Costa Del Mar sunglasses, and top-of-the line camping gear. The site includes a picture of the item from different angles, a review, list of features, a sizing chart, some recommended uses, and the price (complete with the percentage off and the savings). It also shows the quantity remaining and an estimated countdown of when the site will be sold out. The user has the option of getting a live-feed of the items for sale and an alert system of favorite items.
I log onto Steep and Cheap almost every time that I get online, usually after I check my Facebook and before I check my email. I do it often so I do not miss out on a good deal. I have bought three jackets, a pair of sunglasses, and some shoes. The site has an excellent return policy in case the user is not satisfied with the item. I have been very satisfied with every purchase. One time, when I was at my boyfriend’s house, there were sunglasses offered at 70% off. He and three of his roommates immediately got on and ordered a pair.
This website is very innovative. Each sale creates value for the item because the buyer feels like he is getting a great deal. It becomes a game where the user wants to buy and hopes there is something he is interested in every time the site is accessed, a creative advantage to their competitors. Honestly, I do not even know if Steep and Cheap have any competitors because I am loyal to this site. The site has a niche of users, people who like upscale outdoor gear and are technologically inclined. This description describes, or partially describes a majority of people in Austin. The site has a big, loyal following. I have never seen a site offer such a specific group of things and be so successful. Steep and Cheap has found a better, more creative, and more innovative way to do online sales and has been very successful at it. By showing the sales price next to the countdown of when the site will be sold out, it puts pressure on the buyer to make a split second decision, a buyer who has already been interested enough to visit their site. When I bought my jackets, I probably only needed the first one. The other two are impulse buys. If I had seen the jackets in a store, I would not have purchased them, and I for sure would not have spent the time searching the internet for a good deal. Steep and Cheap brings everything to the buyer in a way that makes it seem like the buyer is winning by purchasing. The innovation of the website and the creative way the company is structured gives Steep and Cheap a huge advantage over other online realtors.
In the Wall Street Journal article, The New, Faster Face of Innovation, it discusses companies being able to try new things quickly. When a brand, like Patagonia, decides to sign up for this site, I imagine it is very beneficial. They no longer have to worry about finding a venue to sell their items that are not being sold, the venue comes to them. The website initially sold mostly outerwear. It would be very cost effective for them to test out new items. It would only take twenty minutes during prime sales time to decide that this item will sell well on the site or it will not. Even if the item is not sold, it gives the company insight into what their consumer wants. The company does not really lose out on much, and their tests are very cheap and easy. The amount of responses they get for an item is indicative of how much the consumer likes the item. This mirrors the article’s assertion that customer’s “likes and dislikes will have much more impact on companies’ decisions.” It is very easy for the company to try new things. Traditional practices, like forming a focus group make no sense because the focus group is brought to Steep and Cheap. The site can store data from the amount of hits received during each item’s presence to determine what should be put on the site.

Monday, September 28, 2009

Experience Expectations

The primary lesson from “The Effect of Expectations” chapter of Predictably Irrational is that consumer expectations influence their thought of the product. Ariely begins with an example of how, in a sports game, the team cheered for can honestly make a viewer think that a play should be called a certain way and begs the question, “How can any two parties look at precisely the same event and interpret it as supporting their opposing point of view?” This boils down to the hypothesis that our expectations about an event can affect our overall perception of the event. Having an assumption will cloud our expectations. There is something fundamentally irrational in humans that change our perception. The expectations of adding vinegar to beer changed the amount of enjoyment a drinker experienced. When the consumer knew the vinegar had been added, they enjoyed it less. When the consumer either did not know about the vinegar or found out after the beer had been tried, the taster enjoyed the beer with vinegar more. The timing of the input was critical. The tasters had to know of the ingredient before they had experienced it for themselves for their perceptions to be changed. The experiment found that “if you tell people up front that something might be distasteful, the odds are good that they will end up agreeing with you.” The same was found with perceived value and the ambiance of a coffee testing facility: the better the facility looked, the more the coffee was worth. Even when brain sensory receptors were tested, memory of a brand’s reputation effected the reception of the item.

This information is valuable to customer experience. The brain does not start from scratch with every new situation it encounters. Stereotypes then “provide shortcuts to our never-ending attempt to make sense of complicated surroundings.” People judge experiences with a pool of stereotypes and perform in accordance to those stereotypes. Marketers equipped with this knowledge should give consumers preconceptions about the excellence of their product in order to maximize the consumer’s experience. If they reach a consumer first and tell the consumer that they will enjoy the product, the consumer will be more likely to see value in the product and enjoy their experience with it. Word-of-mouth tactics are especially prevalent here. Marketers who disguise themselves as part of the public can spread the word about a product in a positive light. For example, a marketer who replies to blog entries on engadget.com about their product can put their product in a positive light. This will make the users (who are primarily early adopters of technology) more predisposed to like their product and speak positively about it. These positive responses will affect their less technology savvy friends and more people will see this product positively. Users who are told what to expect will view the product in a biased way.

An example of this type of marketing is the notion that Polo shirts are superior to other shirts. The other day, I had two friends wearing similar grey, single pocket t-shirts. One was purchased at Wal-Mart for less than $5 and one was purchased from a Polo store for about $30. The pockets were in the same location and the same size. The grey looked the exact same shade, and the texture of the shirt had no significant difference. If I had asked a third-party group who had been exposed to the Polo brand which shirt had superior value, they would for sure report that the Polo shirt did. If I asked people who had never heard of the brand, and had no preconceptions or stereotypes for what an embroidered horse decal meant, the results would be about even. The perceptions of the first group have been skewed because they know what the brand means. They view the brand in a biased way and produce a biased response.

Wednesday, September 9, 2009

Ten insights

1. Inexpensive
For the college-age person, price is a dominant factor in any purchase. The average student does not have a lot of money and will not be willing to spend a lot of money. If a marketer is trying to come up with something for everyday college life, it must be cheap, especially if it is an activity. Some things, like phones, lap tops, etc are mostly bought by a student’s parents and can adhere to this policy less. Any purchase that a student must buy themselves must be cheap. In this sense, our speaker talked about Designing for Simplicity and doing one thing really well. This is key for price reduction. Most college-age people are interested in basics, not the upgrade package.
2. Convenient
After having a hard week of school, convenience is key. Activities that require too much thinking or preparation time do not get completed. Living with 58 other girls in a sorority house, I have noticed that Ikea can be both a friend and enemy. My roommate currently has the partially assembled remnants of a desk on our floor. Putting together that desk will take a lot of time and effort. Although the inexpensive aspect t has been met, the prep time and convenience is too great. I doubt she will ever revisit Ikea, especially after the school year has begun. In class, we discussed the ease of using Apple products. The directions are hardly ever used. For Ikea desks, directions are necessary. Students do not like to consult directions, we want to jump into using the product. Universal design is crutial.
3. Dressing up.
For females especially, dressing up is a big part of going out. Getting ready with friends to go downtown is sometimes more fun than the actual downtown experience. If marketer is trying to create an experience geared toward college-age females after hours lifestyles, it should include getting dressed up. The aspect of looking good heightens the positive experience one has while downtown or similar. This is especially important for restaurants or bars. Casual bars in proximity to campus are casual, but if someone is going to go out of the West Campus area at night, it should probably have a more upscale feel, so females will dress the part and want to go back.
4. Involves multiple people.
After high-stress days students need to socialize. It is an important aspect of college. Products that involve multiple people or facilitate socialization are extremely utilized. Facebook, Myspace, text-messaging, etc. are excellent examples. College students go out to restaurants and bars in groups. Students crave socialization post-class. Anything that creates an experience that can house any number of people is a good idea. A marketer should derive a product (game) or location that has potential to aid in socialization and group experiences.
5. Comfortable.
Marketers who design household or lounge items need to focus on comfort level. Austin is all about comfort. People are seen sporting Chacos and lounging in Snuggies not for fashion. It is because they are comfortable. Anything I do, I like to maximize my comfort level. This is especially important when making study rooms. The business school’s Reliant room is always full because it maximizes comfort while retaining utility.
6. Not excessive.
Dieter Rams’s philosophy was to have as little design as possible. He liked things that had function, not decoration. For products that aid in studying, school work, or office work, the simpler the better. I am not as concerned with something that looks nice as I am with something that works well. Simplicity of design is key for everyday items.
7. Fun.
When creating an experience, something needs to be fun. Thought-provoking and interesting are good, but fun brings people in. When I go somewhere, I am predominately interested in enjoying myself. It is a basic college-age want. An atmosphere designed to empower a student to have fun is an atmosphere that will be successful. As Henry Dryfuss theorized, improving the human experience is important, and fun plays a key roll.
8. Trendy.
Everyone loves the latest fad, so marketing something that has the potential to be trendy is important. Designing for the trendy early adopters will make it marketable. Designer handbags are an example. They are a luxury, but they are trendy. Louis Vuitton’s brown and tan bags are actually not that cute, but they are trendy, which makes people want them. Nike shorts are another great example. There are substitutes, but they are utilized all over campus because they are made for the majority of young American women, and they are trendy.
9. Environmentally conscious.
I feel good when I think I am helping someone. Tom’s shoes matched the need to help with trendiness. It empowers a person to know he did his bit in helping the world become a better place. Patagonia is worn by outdoorsy type people because their business model decreases the carbon footprint on the environment. Nalgeen water bottles have skyrocketed, as people found the perils in continually throwing away bottles of water. If something is designed for both the greater good and my immediate good, it is a bonus. I will buy something the fulfills both those categories before buying a substitute that only benefits myself.
10. Healthy.
Especially in food, healthiness is a benefit. In college, women grow out of their lean high school bodies into the freshman 15. This opens their eyes to the world of exercise, yoga, and health food. Products targeted at making someone healthier make people feel better about themselves, which makes them want more.