Given the state of the economy, it is important that retailers look to incorporate stand out practices into their stores as a means of differentiation. In the past there has always been an emphasis on price, the degree of assortment, types of services offered, etc. Green retailing has become as a differentiating measure that is helping to capture demand from eco-friendly customers. Charged with the desire to differentiate their brands and find a significant increase in their ROIs, retailers are looking to a variety of methods by which they can ‘go green.’ Some retailers have adopted the cause by promoting recycling of plastic bags, selling reusable bags, and educating their customers on the importance of protecting the environment. Other retailers such as McQuade’s Marketplace have stepped out to the forefront as a green innovator and have taken ‘going green’ to an entirely new level.
According to the article, “McQuade’s puts ‘green’ in green grocer,” the independent retailer took measures this past year that allowed it to open the largest solar electric system in all of Rhode Island. “The new system will generate about 168, 200 kilowatt hours of clean energy each year which is roughly the power needed to for 10 average-sized New England homes.” Green innovations are wise to incorporate into one’s stores, for the government (along with other green advocacy groups) provides financial backing that can supplement the costs associated with the major projects. “The solar installation atop the Mystic store received a grant of more than $641,000 from the Connecticut Clean Energy Fund. The fund was created by the Connecticut legislature -- and is funded by electric ratepayers -- to promote, develop and invest in clean energy sources.” Retailers can differentiate their stores and earn new business with financial backing and the knowledge that they are aiding their environment. It’s a win win situation.
This blog was written by Katie Tretter, Cassie Wolcott, and Daniel Lee
The consumer cable services industry is homogenous by nature, yet a handful of national giants command a large portion of market share. The difference in quality and speed between services is negligible to the average consumer of Cable Television and Internet, however market leaders have managed to separate themselves from competition through the use of advertising to create perceived product differentiation. According to Comcast, Verizon Battle it out for Market Share, an article written for boston.com, Comcast Corp. and Verizon Communications Inc. have become incredibly effective in convincing the nieve consumer that they have “the best deals, the most amazing TV pictures, and Internet speeds to dazzle the cyber gods.” The two firms have managed to avoid simple comparisons to each other by offering a motley assortment of cable movie channels and questionably unique pricing packages. Currently, Comcast possesses a stronghold in Massachusetts with 1.6 million subscribers compared to Verizon FiOS’ 226,000, however this gap is rapidly disappearing as FiOS continues to rewire community after community.
In their commercials, both Verizon and Comcast boast superior service speed. Although both firms argue their service is more advanced than any other, industry analysts state that the technical differences between Verizon’s and Comcast’s systems are trivial. According to Bruce Leichtman, president of cable industry tracking firm Leichtman Research Group, “They’re almost identical. If people think they’re missing out on a humongous product differentiation, that’s not true.” As explained by independent telecom analyst Jeffrey Kagan, Verizon entered the TV industry with superior technology to that of traditional cable companies like Comcast, however “that forced the cable companies to upgrade.”
Since Verizon’s major competition has followed their move toward fiber optics, market shares of industry giants remain very competitive, differing only due to minor differences and a perceived competitive advantage from advertising.
This blog post was written by Stephanie Cohen, Carleton Cady, Jeanette Elliot and Walter Peek
Anyone who has ever watched a sporting event can recall an ad on television where high profile athletes are consuming Gatorade. Whether it be Michael Jordan, Tiger Woods, or Derek Jeter, all of these high profile athletes have one thing in common, they all drink Gatorade to perform at their best(or at least that is what Gatorade wants you to think!). Since being introduced in the United States in 1965, Gatorade has become the official sports drink of a number of sports including the National Football League, Major League Baseball, the National Basketball Association, and the National Hockey League just to name a few.
Gatorade’s message over the years has been that it restores electrolytes, helping athletes stay on top of their game by refueling them with nutrients they have lost through sweat. Memory jamming is a technique used to influence the way consumers encode and recall their consumption experiences. Gatorade uses memory jamming by engraining the benefits of their products into the mind of the consumers, and by using a variety of athletes who help to advertise Gatorade’s brand.
In recent years, Gatorade’s ad campaigns have moved away from the technical benefits of the drink, focusing more on elite athletes consuming their product. Powerade, Coca-Cola’s sports drink, launched attack ads on Gatorade in 2009, which led to a significant loss in market share from 80.0% in 2008 to 73.7% in 2009, a decrease of 6.3% (BusinessWeek). In one of the ads, Powerade claims that Gatorade is missing two electrolytes, magnesium and calcium in their sports drinks, and instead markets Powerade as the complete sports drink (Brandweek) . Some experts felt as if the decline in market share was in part due to Gatorade’s new ad campaign that proved to be more indirect and abstract than past years. The consistency that Gatorade had in their advertising for years was compromised with their new ad campaign, and as a result, it affected their market share in a negative way.
This blog post was written by Ben Lee, Tracy Liang and Freddie Joyner
Only on Valentine’s Day would cash-broke Cornell students spend their entire weekly living allowance to purchase over priced flowers. Why? Perhaps as a result of passionate intimate feelings only someone experiencing “true love” could understand. Or, said by the heartbroken naïve underclassman whose only companionship is Ben & Jerry’s, “persuasive advertising”. Society has been influenced by movies, commercials, and almost every other form of mass media to believe an illustration of love equates to either chocolate or flowers, sometimes even both.
Bob Sullivan, MSNBC’s detective on internet scams and consumer fraud, wrote a story detailing the outrageous flower prices charged in the days leading up to Valentine’s Day. His findings compared three online flower companies who each advertised the most affordable prices on the internet. FTD.com, Proflowers.com, and 1800Flowers.com sold roses at the price of 38.49, $35.28, and $34.99, respectively.
For the Cornell students who didn’t think to pre-order flowers via the internet, they could still express their love; of course, for an even higher premium. On the small strip of College Avenue, what Cornell students refer to as “Collegetown”, flowers could be purchased virtually anywhere, as seen by the pictures below. The fundamental principles of persuasive advertising force even intelligent Ivy League students to fall victim to flower sales on Valentine’s Day.
Valentine’s Day is advertised as the one day a year to illustrate your love for someone. If you fail to acknowledge how much you love your companion on Valentine’s Day you’ll probably be single very quickly. A student’s (or consumer) demand curve becomes progressively more inelastic because more consumer are in the market, there are essentially no substitutions, and the preference for flowers on Valentine’s Day compared to any other day throughout the year has increased. The result as Sullivan states, “the price of an item (flowers) is routinely more than double the advertised price. Who said love was free?
This blog post was written by Amyn Bandali, Meghan Holleran, Stephanie Menke, and Philip Nachbar
The Superbowl attracts thousands of viewers each year, most of whom are looking to put their critic hat on and judge the effectiveness of the million dollar commercials that air on primetime. But what is it that determines one commercial a success and another a failure? For many, it’s the degree of humor but for Sands Research, a company specializing in neuromarketing services, it’s the physiological response elicited and degree of brand recall that deems one superior to another. In an article entitled, “Sands Research Conducts Real Time Brand Imaging of Viewers Exposed to Superbowl Commercials,” a Sands’ reasearcher was quoted saying, “We found that brand recall improved significantly if a company had two or more commercial spots throughout the course of the game." Sands’ findings parallel concepts discussed in class, in that consumers respond to specific forms of advertising, usually taking the shape of persuasive, informative, complimentary, or memory jamming. Superbowl commercials revolve around the memory jamming concept, in that some repeat in frequency throughout the game to reinforce a given message. In addition, the persuasive view could be applied to the commercial phenomenon, because they invariably trigger specific brain activity that establishes a subjective opinion in the minds of the consumer and help to differentiate the good/brand. As seen in the picture below, certain commercials elicit specific brain activity which indicates the degree of viewer engagement. Bridgestone was considered the big winner last year, in that it stimulated the most brain activity among viewers. This brain activity proved to have positive correlation for company growth, for in an article entitled, Bridgestone Readies Ads for Superbowl, Michael Fluck, a representative from Bridgestone Firestone North American Tire is quoted saying, “while the overall tire business in the U.S. was down double-digits last year, Bridgestone saw a double-digit increase in market share.”
Clearly, there are underlying factors that go into the commercials you will see during the game. Though comedy may be a large part of what stimulates the human mind, there are other triggering components that will influence your memory and the way you differentiate products.
This blog post was written by Katie Tretter, Cassie Wolcott and Daniel Lee
Through product differentiation, a firm plans to attract more consumers. One such example of product differentiation in today’s market is the Ipad, from Apple. Though many question the difference between this product and its recent ancestor, the Ipod, Apple hopes that the unique features will capture a whole new line of customers. This video presentation from Apple describes all of the features unique to the Ipad.
Though Apple has formulated many explanations as to how the Ipad is different from an Ipod, the following are three of its most widely advertised features [1]:
Safari: The 9.7” multi-touch display allows for easier viewing while browsing.
App Store: The Ipad is compatible with nearly 140,000 pre-existing apps from the current Apple store.
Ibooks store: This feature, unique to the Ipad, allows for readers to download and read magazines instantly.
Apple has positioned the Ipad as a new genre of technology between that of a smart phone and a laptop. The intent is that the Ipad will attract gamers, readers, Ipod owners, and personal computer owners. With Mac products, people are looking for quality, high value, in a top-of-the-range product. Because Apple differentiates through innovation, consumers feel they are “in” and that they are buying the new, high-fashion product.
As for our personal analysis, we feel the Ipad is merely an overpriced, oversized Ipod with little potential to succeed. Though Apple has taken marginal steps to differentiate the Ipad, we do not feel these differences will be widely realized or appreciated by consumers.
We have all seen the Apple ads featuring Justin Long as a Mac and John Hodgmen as a PC, but have we really thought about their impact on the computer market? Through the ads, Apple is conveying that Macs are better than PCs for many different reasons including ease of use, design, reliability, and security. It is also necessary to look at the characters in the ads; they are Mac and PC users personified. Mac is young and trendy while PC is stodgy and nerdy. Both the arguments in the commercials and the characteristics of Mac and PC work together to influence a consumer’s perception of the two biggest players in the computer market.
Apple has spent millions attempting to make consumers think their products are superior to PCs. As a result of Apple’s product differentiation, they have made consumers much less price sensitive when buying Macs. According to Betanews.com, the average selling price for a PC was $475 compared to $1361 for a Mac over Q4 2009. There are two interesting things to take from those figures, the average Mac is sold at a premium of nearly $900 and Apple’s cheapest computer at $600 is still 26% more than the average PC. When looking at the overall computer market, Microsoft has a 90% market share compared to Apple’s, which is nearly 6%. However, take the premium computer market ($1000+) and Apple commands a 90% market share to Microsoft’s 9%.
Even though both Macs and PCs perform the same basic tasks, one has positioned itself as a product that exudes style, sophistication, status, and intelligence. As a result, Apple has taken advantage of consumer’s perceptions and is able to charge almost 3 times as much for a product that is essentially the same.
This blog post was written by Freddie Joyner, Benjamin J. Lee and Tracey Liang
