Marketing Guru

Pirated Goods, good or bad?

2011-01-09T11:55:00.000-08:00

How many of us bought all the music on their computer? How many of us bought any of it? Some of us, a rare few, legitimately own every second of music that they have. Yet the vast majority, most especially those raised in the internet era, do not have a troubled conscience for having stolen thousands of hours in music and, in unison with others, millions of dollars in sales revenue from the music industry.

It is most commonly referred to as file sharing, yet this is a euphemism for the actual truth. Though one is "sharing" a file with a friend or absolute stranger, the actual truth is that they are stealing from the industry.

Yet all industries have commonly been hassled by counterfeit markets. therefore this is not a novelty. In fact this has been an ongoing problem since far before Napster. Aside from music being pirated there exists the pirating of clothing, movies, computer software, and basically anything that can be sold. In the U.S. it is possibly most common for people to encounter counterfeit products through the web and file sharing. Yet in other places in the world other forms of counterfeit are more common place, and far more accepted. This anecdote might help explain. I was in Jakarta, Indonesia. I was visiting an old, and she takes me to a mall where we meet the head of the anti-counterfeit Indonesian office. We have lunch with this lady and I told her that I was looking to buy some souvenirs and presents for my family back home. She instructed that I shouldn't even bother with the mall we were in because that particular mall was for the wealthy who wished to spend money. I should instead cross the street and go to the counterfeit mall. The counterfeit mall was a large 6 story building filled with pirated copies of everything. Now if the head of the anti-counterfeit office is telling me that I should cross the street to a massive mall where I will find cheap imitations of originals, then what hope is there in the fight to protect copyright laws? This is the reality that all industry have to take into consideration.

Of course some enforcement does exist, for example many Australians go to South East Asia and while there buy pirated products. Yet many of them don't know that Australia enforces some serious punishment at customs. This occurs all over the world, and there is not distinction in social class between those who will buy real or counterfeit brands. So what does the future hold for us, if we live in a world where before a hollywood makes it to the big screen in America, it can already be downloaded on the web for free? Well there is a need for innovation and enforcement where possible. Two good examples of great innovation are Netflix and Pandora. The most basic pandora package is free, and functions just like any radio would. the difference is that it is customized where it becomes possible for listeners to skip songs and inform the website of their preferences by selecting artists they want to listen to. Pandora listeners can even travel while listening to pandora so long as they have an internet connection on their phone. Pandora makes money through advertisements on its website and in turn allows the industry to make money as well. Pandora also makes music sharing much more convenient then say for example Lime-wire where through file sharing the user you are sharing with might transfer a file that contains a virus. Another solution to this problem are programs such as iTunes, which enables a user to purchase songs and albums at a fraction of the cost. due to the fact that the expense of transportation and production of CDs becomes nonexistent. Netflix on the other hand enables us to watch movies instantly and receive movies in the mail rather quickly. What all three of these websites allow is the reduction of opportunity cost. It takes time to what you want when you want it on the web for free. yet this does not happen when you use one of these programs, as they are safe and dependable. Often times boot-leg copies end up being bad copies, ruining the entire experience. Therefore it is my opinion that a customers desire for quality will save these industries. When one gets stuff for free its quality is never as good, as the competition has been eliminated. With regards to the clothing industry, many famous brands have of late been producing poor quality clothes, therefore the counterfeit industry might actually serve the industry well as it will restore the need to produce better quality products.

So, is counterfeit bad? my personal judgement is that it ends up balancing out, as it creates greater competition and allows the market to move forward.

two interesting links on the matter are found bellow:

http://mis-asia.com/news/articles/hp-malaysia-seizes-more-than-370-counterfeit-products

http://www.hg.org/article.asp?id=5043

Google, looking to buy Groupon? I don't think so....

2010-12-04T18:53:00.000-08:00

Groupon is a website service that specializes in offering its subscribers special deals. Haven’t heard of it? Then jump on the bandwagon!! Groupon is a website that offers discounted rates for all types of activities within your city, it is able to do so, because it ensures to the business offering the special deal that the special deal will result in a greater majority of customers. Simply put, it is similar to how a business lowers its price or offers special deals when selling in bulk, or when a service is being sold to a big group. In this case the group is much bigger and therefore the price can be lowered drastically. The more people subscribe through Groupon and the more the company expands the greater the number of deals and the better their price. Currently Groupon is the absolute leader in this industry, though many other companies have copied it, none are a direct threat. The only that comes close is LivingSocial. Living Social though has much catching up to do. Considering that this year Groupon reached over 150 million $ in sales while LivingSocial only reached 49 million, it seems unlikely at this stage that LivingSocial will ever catch up, especially considering that this business grows exponentially. In fact Groupon is only 2 years old. In such short time its growth is truly astounding; currently it is valued at over 1.5 billion $. LivingSocial’s growth is also astounding, yet not enough. Nonetheless though LivingSocial might never be able to compete with Groupon it is likely that it will never be driven out of the market. Aside from LivingSocial, there are many other imitations of Groupon, yet Groupon is not threatened by any of these. Actually its competitors have favored its growth. How? Simple, imitations of Groupon began in Chicago in 2008, start up in their local cities, doing all the work, all the networking and research and then Groupon comes in, without having to go through the trouble of organizing anything and simply buying off these small companies. Impressive right?!

So what is the buzz on Groupon? Well rumor has it that Google is interested in buying Groupon. Could this be? Well sure it can, Google’s growth is truly intimidating, in fact recently this has lead to a certain degree of scrutiny, where Google is being accused of breaking Antitrust laws. The question therefore is: Will Google buy up Groupon? And what will result from this? One thing is for sure. Google is certainly capable of purchasing Groupon, as well as LivingSocial and any other possible competitor. Yet how will this further expansion favor Google’s already tainted image as a growing monopoly?

If Google buys Groupon then LivingSocial will not stand much of a chance, considering that Groupon’s capital would increase drastically overnight. Yet it might not be in Google’s best interest to purchase Groupon, nor to run LivingSocial out of business because this will of course give greater weight to the accusations that Google is on its way to becoming a monopoly. As well there is the question as to whether or not Andrew Mason, Groupon CEO, is willing to sell. Considering the company’s fast growth, and the fact that Google has attempted to develop similar ideas and has failed, it might not be in the Mason’s best interest to sell. Who know’s maybe in another 2 years it will be Groupon that will be buying off Google. Please comment; your opinion is much appreciated.

Best, Gian Marco

Social Media: a new approach to marketing

2010-11-28T11:30:00.000-08:00

We use social media on a daily basis, to keep in touch with our friends and family. Yet what social media really does is allow us as individuals to market ourselves. The excitement of doing something adventurous is matched only by the excitement of posting pictures and videos of what we did on facebook. In fact I would go so far as to say that some people only do adventurous things to be able to inform all of their social media friends. We have become a narcissistic society. I myself realized how much we have been affected by social media when I realized that I was smiling for pictures and acting as though I was having the time of my life at parties only because I knew those pictures were going to be posted online. In fact we are only as popular as we are online. If we can make others perceive us as being adventurous, fun, interesting by marketing ourselves on facebook it will be easier to convince them in real life. Society is almost trapped in this world. People are absent. They are less aware of what is directly in front of them, what is real, and more concerned with what is happening somewhere else, what is fake and virtual. It is almost no longer possible to relate to those around you as one used to. Take the blackberry for example. The blackberry is equipped with Blackberry Messenger (BBM), a program that allows all blackberry users anywhere in the world to chat. BBM was invented for professional reasons yet it is most often used for personal reasons. Instead of interacting with people face-to-face, programs such BBM, and unlimited text, allow users to interact virtually. It is possible to see this happening anywhere, where instead of being present and aware of ones surroundings people will spend a good amount of their time chatting or texting.

Therefore in a world where facebook statuses are of utmost importance and where people prefer to chat with others virtually instead of actually encountering and socializing with them, can social media be used for business? The answer is a definite yes. Any company that wishes to be a contender in the business world needs to consider social media. This is not an option, as it is not an option for a business today to not have a website, or to not have a phone, etc.

Several companies have been quick in responding to social media and have reaped the benefits. The most notable company is Zappos. Zappos' entire idea for business is based on building a relationship with its customers, taking customer service to an entirely new level. This relationship results in an unparalleled amount of brand loyalty. Previously such an attempt to build great rapport could only be seen in the hospitality industry. Zappos main method of using social media in conducting business is through Twitter. Zappos an online company that sells shoes, and is looking to soon expand into other fields, ensures that all of its employees are passionate about creating customer satisfaction. And all of its employees are required to stay connected through twitter.

Zappos has been so successful in using social media that it has cut back its advertizing budget. It is confident that by building lasting relationships and by ensuring customer satisfaction there is no need for the formal use of marketing. The company therefore depends on its customers to spread the word about how satisfied they are with Zappos. This approach has cut back costs and increased profit. In fact its customers do not consider Zappos because it has the best material product, but rather because it sells the best customer service, which can just as well be seen as a product.

The use of social media for marketing is also visible among celebrities, and small businesses. This is a movement that cannot be ignored and should be taken advantage of. Though it may be time consuming its benefits will be worth the input.

References:
http://www.readwriteweb.com/archives/zappos_twitter.php

http://www.nbcmiami.com/news/local-beat/Miami-Food-Trucks-Cook-Up-New-Trend-109809184.html

Hypnosis and Marketing

2010-11-20T12:18:00.000-08:00

Advertisers are constantly trying to get a buyers attention. Today we can find ads everywhere. Our society is constantly marketing itself, and it therefore becomes more competitive to sell ones products or services. To remedy for this Marketing experts have theorized and tested the ability to subliminally condition a potential customer or buyer. The theory has been around for decades, and simply put it is believed that one can cause someone to subconsciously want to do something through subliminal messages. We are used to seeing what are known as supraliminal messages, which are those that our minds can absorb and reason. Yet subliminal messages do not allow our minds to reason the message, they simply seek to implant it into our brains. Several studies have been done on this. The tests have consisted of both visual, and auditory stimuli. With visual stimuli it is believed that by inserting words, or images into a commercial at a speed that is too fast for the rational mind to absorb, the subconscious mind of a subject can be made to react to the stimuli. In auditory stimuli, it is believed that by inserting message that has been recorded backwards into an ad, a message can be conveyed to the listener. It has been found that visual stimuli do in fact prove to cause the individual to react in a given manner, yet auditory stimuli have not done so. Nonetheless the trouble with these subliminal messages is that their effects only last very little, they are never truly implanted into the brain. Yet what if one where to take the experiment a step forward, and what if one were to go as far as to use hypnosis?

Hypnosis is a state of mind that enables you to be more susceptible to suggestion. Though there are many charlatans out there who claim to know hypnosis, there are also those who have genuinely studied the science. You may be skeptical, in fact I myself was. Until I found out that some of my family members had actually sought out hypnotherapy (the process of using hypnosis for psychological therapy). Two family members had used it to quit smoking; both had been smoking for over 20 years and had tried everything to quit; yet nothing had worked. Then after visiting the hypnotherapist they suddenly stopped.

So what would happen if hypnosis could be used in ads, and what sort of legal implications would this create? The fact is that hypnosis cannot force you to do something, you have to be willing to be hypnotized, or in other words, my family members wanted to stop smoking, you cannot go to somebody who wants to smoke and through hypnosis force them to quit. Therefore you will not be able to force a buyer to buy something that they do not need or want. Yet you may be able to attract the buyer who just needs a little push to make their final decision. Though I have to admit that the thought scares me a little, I am also curious as to seeing how it would play out. As well, the world of marketing already does push us to do things without our complete awareness: the use of color schemes in fast food restaurants that are meant to increase a customer’s desire to eat; the use of music that can either have a calming or exciting effect; the use of chemicals such as MSG to enhance the flavor of a product to produce a mildly addictive effect. I think this topic, if actually implemented, will create some serious controversy, and I myself am undecided as to whether it is really that different from what the marketing world is already doing today.

Thank you for following,
Gian Marco