Time and again research has shown that women speak more words per day than an average male. Now most of the time it leads to gossip which is their forte (pun intended). Now the question is how a marketer like me comes in picture with this inherent female characteristic.
Take this for instance. “Word of mouth” marketing’s basic structure depends on people talking or discussing amongst themselves which is another form of gossiping (both with positive and negative connotation). So I guess by now the exuberant marketers’ eyes are well lit with this notion where women can be used for effective Word of Mouth marketing because they have an inherent trait of information sharing than their counterpart’s i.e. males.
But the most difficult part is the link between the product or its characteristics and why women would discuss about it.
If someday I am able to crack this puzzle then surely, I am opening an interactive social media advertising firm with due importance to women.
P.S. This post is in no way demeaning women in any way or form.
We all know that Brand exists in the mind of the customers. It is the customers who make or break a brand. So it is imperative to understand the parameters which affect the customers to endorse a product and take the product to its zenith i.e. Brand status.
Some of the important parameters to assess a brand are:-
1. Visibility (on roads, showrooms, shelf etc).
2. Media Presence (TV, print, outdoor etc).
3. Advertisement Likeability (customers understanding the ad message). 4. Sales/Market share captured (as Late adopters or Laggards go by this rule).
5. Parent Company (Customers’ belief in the parent company).
6. Benchmarking with other similar brands.
These six pointers may act as a framework to develop a brand; and due importance to any of the pointers depends on the market it will be catered.
Open any marketing book by any marketing guru, you will find one thing in common i.e. 4 P’s for products and to stretch it a bit, 7 P’s for services (someone of course thought of the intangible aspect of a service) and so on and so forth. Now this post obviously won’t talk about the credibility of this practice, because time and again, we have seen how these very principles guide the marketing managers to their well deserved zenith.
Now I somehow see one thread attached to all the P’s without which they would be void. I call the P as "PROMISE". Now looking back again at the conventional 4 P’s i.e. Product, Place, Price and promotion, the "Promise-P" is the only element which holds or binds all the other P’s. This "promise" element can be a token of assurance to its customers or in the form of a guarantee to its vendors or suppliers.
I will illustrate it with an example. Take the case of a mobile phone.
First and foremost thing is the promiseto its component suppliers that it will have a rewarding relationship.
Secondly, a promiseto its customer that the product is secure and they can endorse it (this is entangled with 1st P-product). Now if a company fails to do it, then all other P’s will simply fade away.
Then comes a promiseto deliver it as conveniently as possible in a nearby location to reap maximum benefit, both for the company and the customer.
Then the promise to give the product/service within stipulated MRP and this constitutes the Price-P.
Last but not least the promiseto its customers that the promotional message is accurate.
Taking cues from the above stated quotes, we can realize that promise acts as fundamental principle for the 4P’s.
Since Aryabhatta gave the world the number zero which revolutionized the number system, hence I have framed my hypothesis too in the same line and named it as the "0th P-Promise".
Orkut™ is an internet social network service which is run by Google™. It came into existence in January 2004. Now it won’t be wrong to state here that it was one of the first successful endeavor of Google™ to enter into uncharted territories of web 2.0 with this new business model where users were given more authority. Now this post obviously won’t talk about Orkut™ or how it came into existence. It will deal with more subtle yet relevant argument about how consumers are making or breaking a brand or a product per se.
As a precursor of web 2.0 which started off this revolution, it has been innovating quite a few things. Initially started off as a web tool to meet new friends and maintain existing ones. Now they have taken it a step further. Lately it came up with linking blog with Orkut™. Now this is where Google™ does it the best.
I will give some hints about the future of networking, at least for Orkut™. Google™ repertoire has Google™ adwords (internet advertisements), Google™ search engine, iGoogle™, Google™ videos, Google™ blog etc. Now even I don’t know how many products Google™ has? But I know one thing for sure that they are all free of cost for the users. Now can anyone give me one good reason why shouldn’t the users love it?
Now think about Google™ coming out with something like open sourceoperating system (OS)? I guess Microsoft techies are watching this space. Now Google™ is trying to keep its users restricted to its own sites by providing everything for free and that too with innovative services.
Now if more and more users are hooked into Orkut™ (remember human beings are social animal), I don’t think anyone will have any problems in endorsing Google™ products for that matter, since it comes for free.
Also users just love it. Lately Orkut™ was chosen as the Youth Icon of the year 2007 in a contest sponsored by MTV India and Pepsi. Who would have thought like that? It’s not Abhishek Bachhan or Sachin Tendulkar or any other individual. It’s an intangible social networking website. Now, marketers talk about branding. How about this one? Users rated Orkut™ as Numero Uno. Are we marketers getting some cues about future of branding?
Marketers are always on a look out to tap those subtle possibilities from every nook and corner. So how do u see the possibilities when you have zillion people hooked on to the internet and the world of internet is shifting from web 1.0 to web 2.0 i.e. more user generated content? That’s why the future marketers are trying cash in through this internet revolution. And this is exactly what marketers are trying to do in a portal called www.secondlife.com
Second Life (SL) is an Internet-based virtual world where it enables its users, called "Residents", to interact with each other through motional avatars, providing an advanced level of a social network service. Residents can explore, meet other residents, socialize, participate in individual and group activities, create and trade items (virtual property) and services from one another. The stated goal is to create a user-defined world of general use in which people can interact, play, do business, and otherwise communicate. Now isn’t the bell ringing in the minds of the inquisitive marketers?
Infact SL is a huge advertising niche that is ripe for tapping into. Innovative companies have started to cash in, e.g. IBM has their own island in SL where residents (actually the IBM enthusiasts) live and interact with each other. “Harry Porter” was promoted through SL. Moreover, Toyota launched “Scion” brand in secondlife knowing there are millions of SL residents whom they can target and at virtually no cost.
So companies are targeting this platform to build their brand through word of mouth (may be I will talk about effective WOM in some other post). There are marketing companies whose entire business has been reshaped to specialize in brand marketing in Second Life.
How many times have we tried to search something in Google™ and got a relevant result? I guess the percentage of relevancy is a debatable topic here and this forms the very outline of this article. Though most of my search is very much confined within the contours of Google™ itself. Still at the end of the day I am not happy with my search results or there could have been better results to my search.
Now del.icio.us™ (pronounced as delicious-http://del.icio.us/, parent company being Yahoo™) is a new social bookmarking web service for storing, sharing, and discovering web bookmarks where a tag (it is a relevant keyword or term associated with or assigned to a piece of information e.g. a picture, article, or video clip) is used to search.
Now what is the difference? The difference lies in the way both these websites search mechanism works. Google™ uses an algorithm where its spider crawler searches through its vast and extensive database to find the website. And del.icio.us™ uses tags that have been assigned with the links by this users and it also gives us a rating mechanism wherein we can see which page have been rated the highest in terms of usage.
But aren’t we looking for a specific webpage rather than website? That’s why I believe that search through del.icio.us™ is a better proposition altogether than google when the question is about finding relevant webpage.
And if people may ask why del.icio.us™ will be successful? I will say that now since the world has shifted to Web 2.0 where more and more portal is giving its customers more & more control, so why not in search?
Remember Marlon Brando in 1953 movie “The Wild Ones” as a leader of a motorcycle gang riding high on Harley Davidson. Or for that matter our very own Saif Ali Khan in a stripped Calvin Klein out of his jeans. What is the common factor among these two examples? They started a trend- Brando’s case a motorcycle craze and in Saif’s case a symbol of Metrosexualism.
Few days back I was discussing about the same topic with a friend about how can companies tap the market by using “trend” as a tool. Since our discussion was on how we can spot the trend as an effective source and further use it for revenue generation, we comprehended certain problems. For example, sometimes we say isn’t this a new trend but the same trend withers away slowly. That’s the reason sometimes companies can’t rely on it. But what matters most is to understand the subtle indication towards an effective trend.
Now the million dollar question is to analyze and measure the trend to its prime effectiveness.
First of all, our actions and behavior are becoming more universal since we are living in a global village. So this becomes easy for a company whose products have a universal appeal.
Secondly, it’s not about matching the trend with your product but its all about matching the product with the trend. In this way companies won’t fall into the trap of “trend perplexity”.
This can be done by using effective positioning strategies for a product with little scope for doubtful positioning in the mind of the customer. This way companies can leverage the brand value for a sustainable period.
Though the list is not exhaustive still this way companies can have an extra edge from its competitors.
Time and again we have seen that companies are learning the best practices from competitors and emulating it with their own better practices to a certain degree with a hallowed notion that it may give them an edge over the competitors. Now the question is what are we fighting for? The most probable answer would be market share.
Market share can be expressed as a company's sales revenue (from that market) divided by the total sales revenue available in that market. Now, I see a fallacy in the statement. So the article will talk about this myth per se.
The key word from the above statement is “from that market”. Now companies before launching new product have already predefined the market -– they would perhaps say that this is the market that have been segmented, these sort of customers we are targeting and this will be our positioning strategies, and so on and so forth.
Now the question remains that how much have we squeezed from the market or do we have a leeway? Taking an example it will be clear that fighting for market share isn’t the solution because you never know what is there in offering in the next turn.
It is hard to see how PC manufacturers' margins quickly shrank in the 1990's. The cause was not competition among industry players, but the superior bargaining power of their two primary suppliers -- Intel and Microsoft (referring to Michael Porter’s 5-Force Model). In this industry of publishing too, substitutes have become the primary source of competition as readers' attention is diverted to other forms of media.
So rather than fighting for the existing pie, companies can create that space and can take advantage over it (referring to “Blue Ocean Strategy”).
Now the question remains that are the companies in a flexible position with its products/services to implement two key elements – Strategy & Execution? If the company is in a position or can be in a position to take that strategic plunge, then surely the chances to get caught in the vicious fight for market share is over.
The topic is as elusive as its significance. Nowadays companies are trying to implement third generation strategies through second generation organizations with first generation management. But have we forgotten about the key element of it all- called the customers?
Now the customer over the period of time has evolved to be more demand frenzy, irrational, conscious and educated. Companies can’t fool them by saying “customer is king” or “customer is our partner”. Companies have dubbed words like customer care, customer satisfaction etc to please them (Though I find marketing in tune with sexual terminologies like market penetration, brand intimacy etc, though it’s a topic for some other day). Still at the end of the day we have to ask two questions to us.
1. Is the customer happy with us?
2. How can we match customer’s perception of satisfaction with our existing process?
I will try to exemplify with an example. A customer enters a retail shop, fully drenched with some bags in her hand. Now the immediate service would be to take her bags from her hand and make her comfortable in a seat. But at that point of time, the A.C. is not working or some foul smell is around the shop. So what is the end of the story - dissatisfied customer. Isn’t it? (I hope we can have as many examples as possible on this regard).
So the crux of the topic is “companies should try to extract the intangible aspect called EXPERIENCE part into customer buying”. Since more & more companies are attaching service aspect to their tangible product, hence the companies should try and make a good experience for the customers while buying.
This article revolves around the application of game theory to several irreverent issues associated with the markets especially oligopoly market conditions. It has led me to examine the changing nature of organizations and economic institutions, in response to the changing external environment, and to repeated strategic interactions, such as the rivalry amongst the small number of sellers in an oligopoly. So we can try to learn the adaptive strategic market behavior in an oligopoly market using this concept named"Game Theory" by Dr. John Nash.
Here, I have taken the case of oligopoly market condition where the market is dominated by small number of sellers (players) and after a certain period of time they are very much aware of each other’s actions. So within the framework of repeated interactions between different sellers, rationality demands a high level of pattern recognition, memory and computing. So the concept of “Bounded Rationality”comes into play where the players’ memory, computing ability or even competences are retarded which may however be sufficient to generate the set pattern or behavior in an oligopoly market.
Game theory champions say that "Compete without destroying the pie and cooperate without getting your lunch eaten"in business.
So, through Game theory, competing business can cooperate to achieve win-win situations for all players in the market. Game theory also points out the importance of repeated or ongoing interaction between businesses.
If, for example, two competing businesses (let’s take an example of retail stores with similar business models) are playing this game just once, then each has an overwhelming temptation to undercut the other since they are very much aware of the competitor’s strategies. But suppose they are in this business together for the long run, and are trying to achieve a cartel that keeps prices high (I am taking only the prices i.e. profitability aspect as of now). If one of them undercuts the other, the gain is temporary.
So what happens here is - when the other store finds out that the first one has cheated on their agreement, it will not trust the first any more and will retaliate by lowering its own price (in most of the cases). This will reduce the cheater’s future profits below what they would have been if it had honored the cartel agreement. So the cheater suffers in the future in exchange for its immediate gain. If the future is sufficiently important in its calculations, it will be deterred from cheating in the first place.
So, these situations gives us a live business scenario which can be further thoroughly understood by in-depth study of game theory and oligopoly market and the inter-relations amongst them.
P.S. This article shows how "Game Theory" can be utilized to gain the maximum in a given business paradigm.
First of all, I don’t have to say what “Blog” is. We all are learned people and come amongst the educated lot, right? But how many of us have thought Blogs as a medium of learning marketing (may be I am being too bold about it?).
Still I will try to substantiate on it.
As a management student, time and again we were taught marketing strategies; how to comprehend customer’s perception and fiddle (pun intended) with it to make the most out of it. Taking the perspective from the time of Henry Fords to Steve Jobs, we have seen how business models have changed over the years from “Production Era” to“Customer is our Partner”. So has marketing; as it has evolved over the period of time.
For example, when I started writing this blog, I just wanted to share my thoughts with people across the world (and thanks to Google for giving me this platform). Then the vital elemental question arose.
· Whom am I sharing with?
· How can I have more people watch my blog?
All these questions took me from “what I want to give (show)” to “what they want to buy (see)”. Now these two questions in a way exemplify how marketing has shifted!
Now for a modern marketer understanding these two basic questions will do wonders. Isn’t it? This is the crux of the whole topic where blogging has helped me to understand (though in a micro scale) how to sell (show) your product (blog) when your customers (viewers) are demanding and to some extent like a baby! So treating my viewer as my baby, I am still trying to understand “www effect (what, when & where)” aspect of any product (in this case it’s a ‘Blog’).
Over a decade back, the internet heralded a fundamental shift in the economics of information. And the shift continues with web 2.0 taking shapes in the form of Wikis, Blogs, Virtual Games etc.
These technological shifts have revolutionized the conventional Bricks & Mortar business models. There are a number of spectacular examples of totally new companies that have come from nowhere and have scored huge successes – YouTube, MySpace, Blogger, Wikipedia etc which are forming the contours of Web 2.0. At the same time, some large organizations were merely scratching their heads asking “What happened there?”
Exemplifying how technology has shifted over the years...
Web 1.0 ---->>Web 2.0 Britannica ---->>Online Wikipedia PC Games ---->>Second Life CD Now ----->>iTunes PointCast ---->>You Tube, Bit Torrent Personal Websites ----->> Blogs, My Space
But there were some organizations which were prompt to act to this shift. They understood that internet is not a toy for technologists but a new channel for distributing products and services of different types. So they ventured in and the result is that major “Bricks & Mortar” business models have some kind of a presence in the web.
By now, I guess most of you have understood the crux of the article. But one major difference between these two versions (i.e. Web 1.0 & Web 2.0), is the involvement of the customers which forms the DISTINCT DIFFERENCE.
If technology allows new communities to emerge (i.e. Orkut, Myspace etc), then we can do more with the power of “e” (referring to internet). We can design products, sell the products, diffuse information about the products, help each other to use the product or even fix bugs (if necessary).
One of the interesting aspects of web browser is not its extendibility but its applicability and I will try to extend my limited source of information & knowledge to clear it up a bit.
The next disruptive innovation (if it is not a bold statement to make) will probably come with the use of 3-D space as a browsing platform. With bandwidth augmentation, increasing computing power, rapidly improving technologies it is possible to create a 3-D environment (I am not getting into the nitty-gritty of it as it beyond the scope of this article). E.g. Try out a shirt off a virtual shelf and look at yourself in a virtual mirror before buying it. Won’t it be interesting? A 3-D environment can radically change how things are bought and sold.
Still the million dollar question remains - Is it time for transformation? Transformation from real to virtual world and back!
Time and again research has shown that women speak more words per day than an average male. Now most of the time it leads to gossip which is their forte (pun intended). Now the question is how a marketer like me comes in picture with this inherent female characteristic.
Take this for instance. “Word of mouth” marketing’s basic structure depends on people talking or discussing amongst themselves which is another form of gossiping (both with positive and negative connotation). So I guess by now the exuberant marketers’ eyes are well lit with this notion where women can be used for effective Word of Mouth marketing because they have an inherent trait of information sharing than their counterpart’s i.e. males.
But the most difficult part is the link between the product or its characteristics and why women would discuss about it.
If someday I am able to crack this puzzle then surely, I am opening an interactive social media advertising firm with due importance to women.
P.S. This post is in no way demeaning women in any way or form.
We all know that Brand exists in the mind of the customers. It is the customers who make or break a brand. So it is imperative to understand the parameters which affect the customers to endorse a product and take the product to its zenith i.e. Brand status.
Some of the important parameters to assess a brand are:-
1. Visibility (on roads, showrooms, shelf etc).
2. Media Presence (TV, print, outdoor etc).
3. Advertisement Likeability (customers understanding the ad message). 4. Sales/Market share captured (as Late adopters or Laggards go by this rule).
5. Parent Company (Customers’ belief in the parent company).
6. Benchmarking with other similar brands.
These six pointers may act as a framework to develop a brand; and due importance to any of the pointers depends on the market it will be catered.
Open any marketing book by any marketing guru, you will find one thing in common i.e. 4 P’s for products and to stretch it a bit, 7 P’s for services (someone of course thought of the intangible aspect of a service) and so on and so forth. Now this post obviously won’t talk about the credibility of this practice, because time and again, we have seen how these very principles guide the marketing managers to their well deserved zenith.
Now I somehow see one thread attached to all the P’s without which they would be void. I call the P as "PROMISE". Now looking back again at the conventional 4 P’s i.e. Product, Place, Price and promotion, the "Promise-P" is the only element which holds or binds all the other P’s. This "promise" element can be a token of assurance to its customers or in the form of a guarantee to its vendors or suppliers.
I will illustrate it with an example. Take the case of a mobile phone.
First and foremost thing is the promiseto its component suppliers that it will have a rewarding relationship.
Secondly, a promiseto its customer that the product is secure and they can endorse it (this is entangled with 1st P-product). Now if a company fails to do it, then all other P’s will simply fade away.
Then comes a promiseto deliver it as conveniently as possible in a nearby location to reap maximum benefit, both for the company and the customer.
Then the promise to give the product/service within stipulated MRP and this constitutes the Price-P.
Last but not least the promiseto its customers that the promotional message is accurate.
Taking cues from the above stated quotes, we can realize that promise acts as fundamental principle for the 4P’s.
Since Aryabhatta gave the world the number zero which revolutionized the number system, hence I have framed my hypothesis too in the same line and named it as the "0th P-Promise".
Orkut™ is an internet social network service which is run by Google™. It came into existence in January 2004. Now it won’t be wrong to state here that it was one of the first successful endeavor of Google™ to enter into uncharted territories of web 2.0 with this new business model where users were given more authority. Now this post obviously won’t talk about Orkut™ or how it came into existence. It will deal with more subtle yet relevant argument about how consumers are making or breaking a brand or a product per se.
As a precursor of web 2.0 which started off this revolution, it has been innovating quite a few things. Initially started off as a web tool to meet new friends and maintain existing ones. Now they have taken it a step further. Lately it came up with linking blog with Orkut™. Now this is where Google™ does it the best.
I will give some hints about the future of networking, at least for Orkut™. Google™ repertoire has Google™ adwords (internet advertisements), Google™ search engine, iGoogle™, Google™ videos, Google™ blog etc. Now even I don’t know how many products Google™ has? But I know one thing for sure that they are all free of cost for the users. Now can anyone give me one good reason why shouldn’t the users love it?
Now think about Google™ coming out with something like open sourceoperating system (OS)? I guess Microsoft techies are watching this space. Now Google™ is trying to keep its users restricted to its own sites by providing everything for free and that too with innovative services.
Now if more and more users are hooked into Orkut™ (remember human beings are social animal), I don’t think anyone will have any problems in endorsing Google™ products for that matter, since it comes for free.
Also users just love it. Lately Orkut™ was chosen as the Youth Icon of the year 2007 in a contest sponsored by MTV India and Pepsi. Who would have thought like that? It’s not Abhishek Bachhan or Sachin Tendulkar or any other individual. It’s an intangible social networking website. Now, marketers talk about branding. How about this one? Users rated Orkut™ as Numero Uno. Are we marketers getting some cues about future of branding?
Marketers are always on a look out to tap those subtle possibilities from every nook and corner. So how do u see the possibilities when you have zillion people hooked on to the internet and the world of internet is shifting from web 1.0 to web 2.0 i.e. more user generated content? That’s why the future marketers are trying cash in through this internet revolution. And this is exactly what marketers are trying to do in a portal called www.secondlife.com
Second Life (SL) is an Internet-based virtual world where it enables its users, called "Residents", to interact with each other through motional avatars, providing an advanced level of a social network service. Residents can explore, meet other residents, socialize, participate in individual and group activities, create and trade items (virtual property) and services from one another. The stated goal is to create a user-defined world of general use in which people can interact, play, do business, and otherwise communicate. Now isn’t the bell ringing in the minds of the inquisitive marketers?
Infact SL is a huge advertising niche that is ripe for tapping into. Innovative companies have started to cash in, e.g. IBM has their own island in SL where residents (actually the IBM enthusiasts) live and interact with each other. “Harry Porter” was promoted through SL. Moreover, Toyota launched “Scion” brand in secondlife knowing there are millions of SL residents whom they can target and at virtually no cost.
So companies are targeting this platform to build their brand through word of mouth (may be I will talk about effective WOM in some other post). There are marketing companies whose entire business has been reshaped to specialize in brand marketing in Second Life.
How many times have we tried to search something in Google™ and got a relevant result? I guess the percentage of relevancy is a debatable topic here and this forms the very outline of this article. Though most of my search is very much confined within the contours of Google™ itself. Still at the end of the day I am not happy with my search results or there could have been better results to my search.
Now del.icio.us™ (pronounced as delicious-http://del.icio.us/, parent company being Yahoo™) is a new social bookmarking web service for storing, sharing, and discovering web bookmarks where a tag (it is a relevant keyword or term associated with or assigned to a piece of information e.g. a picture, article, or video clip) is used to search.
Now what is the difference? The difference lies in the way both these websites search mechanism works. Google™ uses an algorithm where its spider crawler searches through its vast and extensive database to find the website. And del.icio.us™ uses tags that have been assigned with the links by this users and it also gives us a rating mechanism wherein we can see which page have been rated the highest in terms of usage.
But aren’t we looking for a specific webpage rather than website? That’s why I believe that search through del.icio.us™ is a better proposition altogether than google when the question is about finding relevant webpage.
And if people may ask why del.icio.us™ will be successful? I will say that now since the world has shifted to Web 2.0 where more and more portal is giving its customers more & more control, so why not in search?
Remember Marlon Brando in 1953 movie “The Wild Ones” as a leader of a motorcycle gang riding high on Harley Davidson. Or for that matter our very own Saif Ali Khan in a stripped Calvin Klein out of his jeans. What is the common factor among these two examples? They started a trend- Brando’s case a motorcycle craze and in Saif’s case a symbol of Metrosexualism.
Few days back I was discussing about the same topic with a friend about how can companies tap the market by using “trend” as a tool. Since our discussion was on how we can spot the trend as an effective source and further use it for revenue generation, we comprehended certain problems. For example, sometimes we say isn’t this a new trend but the same trend withers away slowly. That’s the reason sometimes companies can’t rely on it. But what matters most is to understand the subtle indication towards an effective trend.
Now the million dollar question is to analyze and measure the trend to its prime effectiveness.
First of all, our actions and behavior are becoming more universal since we are living in a global village. So this becomes easy for a company whose products have a universal appeal.
Secondly, it’s not about matching the trend with your product but its all about matching the product with the trend. In this way companies won’t fall into the trap of “trend perplexity”.
This can be done by using effective positioning strategies for a product with little scope for doubtful positioning in the mind of the customer. This way companies can leverage the brand value for a sustainable period.
Though the list is not exhaustive still this way companies can have an extra edge from its competitors.
Time and again we have seen that companies are learning the best practices from competitors and emulating it with their own better practices to a certain degree with a hallowed notion that it may give them an edge over the competitors. Now the question is what are we fighting for? The most probable answer would be market share.
Market share can be expressed as a company's sales revenue (from that market) divided by the total sales revenue available in that market. Now, I see a fallacy in the statement. So the article will talk about this myth per se.
The key word from the above statement is “from that market”. Now companies before launching new product have already predefined the market -– they would perhaps say that this is the market that have been segmented, these sort of customers we are targeting and this will be our positioning strategies, and so on and so forth.
Now the question remains that how much have we squeezed from the market or do we have a leeway? Taking an example it will be clear that fighting for market share isn’t the solution because you never know what is there in offering in the next turn.
It is hard to see how PC manufacturers' margins quickly shrank in the 1990's. The cause was not competition among industry players, but the superior bargaining power of their two primary suppliers -- Intel and Microsoft (referring to Michael Porter’s 5-Force Model). In this industry of publishing too, substitutes have become the primary source of competition as readers' attention is diverted to other forms of media.
So rather than fighting for the existing pie, companies can create that space and can take advantage over it (referring to “Blue Ocean Strategy”).
Now the question remains that are the companies in a flexible position with its products/services to implement two key elements – Strategy & Execution? If the company is in a position or can be in a position to take that strategic plunge, then surely the chances to get caught in the vicious fight for market share is over.
The topic is as elusive as its significance. Nowadays companies are trying to implement third generation strategies through second generation organizations with first generation management. But have we forgotten about the key element of it all- called the customers?
Now the customer over the period of time has evolved to be more demand frenzy, irrational, conscious and educated. Companies can’t fool them by saying “customer is king” or “customer is our partner”. Companies have dubbed words like customer care, customer satisfaction etc to please them (Though I find marketing in tune with sexual terminologies like market penetration, brand intimacy etc, though it’s a topic for some other day). Still at the end of the day we have to ask two questions to us.
1. Is the customer happy with us?
2. How can we match customer’s perception of satisfaction with our existing process?
I will try to exemplify with an example. A customer enters a retail shop, fully drenched with some bags in her hand. Now the immediate service would be to take her bags from her hand and make her comfortable in a seat. But at that point of time, the A.C. is not working or some foul smell is around the shop. So what is the end of the story - dissatisfied customer. Isn’t it? (I hope we can have as many examples as possible on this regard).
So the crux of the topic is “companies should try to extract the intangible aspect called EXPERIENCE part into customer buying”. Since more & more companies are attaching service aspect to their tangible product, hence the companies should try and make a good experience for the customers while buying.
This article revolves around the application of game theory to several irreverent issues associated with the markets especially oligopoly market conditions. It has led me to examine the changing nature of organizations and economic institutions, in response to the changing external environment, and to repeated strategic interactions, such as the rivalry amongst the small number of sellers in an oligopoly. So we can try to learn the adaptive strategic market behavior in an oligopoly market using this concept named"Game Theory" by Dr. John Nash.
Here, I have taken the case of oligopoly market condition where the market is dominated by small number of sellers (players) and after a certain period of time they are very much aware of each other’s actions. So within the framework of repeated interactions between different sellers, rationality demands a high level of pattern recognition, memory and computing. So the concept of “Bounded Rationality”comes into play where the players’ memory, computing ability or even competences are retarded which may however be sufficient to generate the set pattern or behavior in an oligopoly market.
Game theory champions say that "Compete without destroying the pie and cooperate without getting your lunch eaten"in business.
So, through Game theory, competing business can cooperate to achieve win-win situations for all players in the market. Game theory also points out the importance of repeated or ongoing interaction between businesses.
If, for example, two competing businesses (let’s take an example of retail stores with similar business models) are playing this game just once, then each has an overwhelming temptation to undercut the other since they are very much aware of the competitor’s strategies. But suppose they are in this business together for the long run, and are trying to achieve a cartel that keeps prices high (I am taking only the prices i.e. profitability aspect as of now). If one of them undercuts the other, the gain is temporary.
So what happens here is - when the other store finds out that the first one has cheated on their agreement, it will not trust the first any more and will retaliate by lowering its own price (in most of the cases). This will reduce the cheater’s future profits below what they would have been if it had honored the cartel agreement. So the cheater suffers in the future in exchange for its immediate gain. If the future is sufficiently important in its calculations, it will be deterred from cheating in the first place.
So, these situations gives us a live business scenario which can be further thoroughly understood by in-depth study of game theory and oligopoly market and the inter-relations amongst them.
P.S. This article shows how "Game Theory" can be utilized to gain the maximum in a given business paradigm.
First of all, I don’t have to say what “Blog” is. We all are learned people and come amongst the educated lot, right? But how many of us have thought Blogs as a medium of learning marketing (may be I am being too bold about it?).
Still I will try to substantiate on it.
As a management student, time and again we were taught marketing strategies; how to comprehend customer’s perception and fiddle (pun intended) with it to make the most out of it. Taking the perspective from the time of Henry Fords to Steve Jobs, we have seen how business models have changed over the years from “Production Era” to“Customer is our Partner”. So has marketing; as it has evolved over the period of time.
For example, when I started writing this blog, I just wanted to share my thoughts with people across the world (and thanks to Google for giving me this platform). Then the vital elemental question arose.
· Whom am I sharing with?
· How can I have more people watch my blog?
All these questions took me from “what I want to give (show)” to “what they want to buy (see)”. Now these two questions in a way exemplify how marketing has shifted!
Now for a modern marketer understanding these two basic questions will do wonders. Isn’t it? This is the crux of the whole topic where blogging has helped me to understand (though in a micro scale) how to sell (show) your product (blog) when your customers (viewers) are demanding and to some extent like a baby! So treating my viewer as my baby, I am still trying to understand “www effect (what, when & where)” aspect of any product (in this case it’s a ‘Blog’).
Over a decade back, the internet heralded a fundamental shift in the economics of information. And the shift continues with web 2.0 taking shapes in the form of Wikis, Blogs, Virtual Games etc.
These technological shifts have revolutionized the conventional Bricks & Mortar business models. There are a number of spectacular examples of totally new companies that have come from nowhere and have scored huge successes – YouTube, MySpace, Blogger, Wikipedia etc which are forming the contours of Web 2.0. At the same time, some large organizations were merely scratching their heads asking “What happened there?”
Exemplifying how technology has shifted over the years...
Web 1.0 ---->>Web 2.0 Britannica ---->>Online Wikipedia PC Games ---->>Second Life CD Now ----->>iTunes PointCast ---->>You Tube, Bit Torrent Personal Websites ----->> Blogs, My Space
But there were some organizations which were prompt to act to this shift. They understood that internet is not a toy for technologists but a new channel for distributing products and services of different types. So they ventured in and the result is that major “Bricks & Mortar” business models have some kind of a presence in the web.
By now, I guess most of you have understood the crux of the article. But one major difference between these two versions (i.e. Web 1.0 & Web 2.0), is the involvement of the customers which forms the DISTINCT DIFFERENCE.
If technology allows new communities to emerge (i.e. Orkut, Myspace etc), then we can do more with the power of “e” (referring to internet). We can design products, sell the products, diffuse information about the products, help each other to use the product or even fix bugs (if necessary).
One of the interesting aspects of web browser is not its extendibility but its applicability and I will try to extend my limited source of information & knowledge to clear it up a bit.
The next disruptive innovation (if it is not a bold statement to make) will probably come with the use of 3-D space as a browsing platform. With bandwidth augmentation, increasing computing power, rapidly improving technologies it is possible to create a 3-D environment (I am not getting into the nitty-gritty of it as it beyond the scope of this article). E.g. Try out a shirt off a virtual shelf and look at yourself in a virtual mirror before buying it. Won’t it be interesting? A 3-D environment can radically change how things are bought and sold.
Still the million dollar question remains - Is it time for transformation? Transformation from real to virtual world and back!
Time and again research has shown that women speak more words per day than an average male. Now most of the time it leads to gossip which is their forte (pun intended). Now the question is how a marketer like me comes in picture with this inherent female characteristic.
Take this for instance. “Word of mouth” marketing’s basic structure depends on people talking or discussing amongst themselves which is another form of gossiping (both with positive and negative connotation). So I guess by now the exuberant marketers’ eyes are well lit with this notion where women can be used for effective Word of Mouth marketing because they have an inherent trait of information sharing than their counterpart’s i.e. males.
But the most difficult part is the link between the product or its characteristics and why women would discuss about it.
If someday I am able to crack this puzzle then surely, I am opening an interactive social media advertising firm with due importance to women.
P.S. This post is in no way demeaning women in any way or form.
We all know that Brand exists in the mind of the customers. It is the customers who make or break a brand. So it is imperative to understand the parameters which affect the customers to endorse a product and take the product to its zenith i.e. Brand status.
Some of the important parameters to assess a brand are:-
1. Visibility (on roads, showrooms, shelf etc).
2. Media Presence (TV, print, outdoor etc).
3. Advertisement Likeability (customers understanding the ad message). 4. Sales/Market share captured (as Late adopters or Laggards go by this rule).
5. Parent Company (Customers’ belief in the parent company).
6. Benchmarking with other similar brands.
These six pointers may act as a framework to develop a brand; and due importance to any of the pointers depends on the market it will be catered.
Open any marketing book by any marketing guru, you will find one thing in common i.e. 4 P’s for products and to stretch it a bit, 7 P’s for services (someone of course thought of the intangible aspect of a service) and so on and so forth. Now this post obviously won’t talk about the credibility of this practice, because time and again, we have seen how these very principles guide the marketing managers to their well deserved zenith.
Now I somehow see one thread attached to all the P’s without which they would be void. I call the P as "PROMISE". Now looking back again at the conventional 4 P’s i.e. Product, Place, Price and promotion, the "Promise-P" is the only element which holds or binds all the other P’s. This "promise" element can be a token of assurance to its customers or in the form of a guarantee to its vendors or suppliers.
I will illustrate it with an example. Take the case of a mobile phone.
First and foremost thing is the promiseto its component suppliers that it will have a rewarding relationship.
Secondly, a promiseto its customer that the product is secure and they can endorse it (this is entangled with 1st P-product). Now if a company fails to do it, then all other P’s will simply fade away.
Then comes a promiseto deliver it as conveniently as possible in a nearby location to reap maximum benefit, both for the company and the customer.
Then the promise to give the product/service within stipulated MRP and this constitutes the Price-P.
Last but not least the promiseto its customers that the promotional message is accurate.
Taking cues from the above stated quotes, we can realize that promise acts as fundamental principle for the 4P’s.
Since Aryabhatta gave the world the number zero which revolutionized the number system, hence I have framed my hypothesis too in the same line and named it as the "0th P-Promise".
Orkut™ is an internet social network service which is run by Google™. It came into existence in January 2004. Now it won’t be wrong to state here that it was one of the first successful endeavor of Google™ to enter into uncharted territories of web 2.0 with this new business model where users were given more authority. Now this post obviously won’t talk about Orkut™ or how it came into existence. It will deal with more subtle yet relevant argument about how consumers are making or breaking a brand or a product per se.
As a precursor of web 2.0 which started off this revolution, it has been innovating quite a few things. Initially started off as a web tool to meet new friends and maintain existing ones. Now they have taken it a step further. Lately it came up with linking blog with Orkut™. Now this is where Google™ does it the best.
I will give some hints about the future of networking, at least for Orkut™. Google™ repertoire has Google™ adwords (internet advertisements), Google™ search engine, iGoogle™, Google™ videos, Google™ blog etc. Now even I don’t know how many products Google™ has? But I know one thing for sure that they are all free of cost for the users. Now can anyone give me one good reason why shouldn’t the users love it?
Now think about Google™ coming out with something like open sourceoperating system (OS)? I guess Microsoft techies are watching this space. Now Google™ is trying to keep its users restricted to its own sites by providing everything for free and that too with innovative services.
Now if more and more users are hooked into Orkut™ (remember human beings are social animal), I don’t think anyone will have any problems in endorsing Google™ products for that matter, since it comes for free.
Also users just love it. Lately Orkut™ was chosen as the Youth Icon of the year 2007 in a contest sponsored by MTV India and Pepsi. Who would have thought like that? It’s not Abhishek Bachhan or Sachin Tendulkar or any other individual. It’s an intangible social networking website. Now, marketers talk about branding. How about this one? Users rated Orkut™ as Numero Uno. Are we marketers getting some cues about future of branding?
Marketers are always on a look out to tap those subtle possibilities from every nook and corner. So how do u see the possibilities when you have zillion people hooked on to the internet and the world of internet is shifting from web 1.0 to web 2.0 i.e. more user generated content? That’s why the future marketers are trying cash in through this internet revolution. And this is exactly what marketers are trying to do in a portal called www.secondlife.com
Second Life (SL) is an Internet-based virtual world where it enables its users, called "Residents", to interact with each other through motional avatars, providing an advanced level of a social network service. Residents can explore, meet other residents, socialize, participate in individual and group activities, create and trade items (virtual property) and services from one another. The stated goal is to create a user-defined world of general use in which people can interact, play, do business, and otherwise communicate. Now isn’t the bell ringing in the minds of the inquisitive marketers?
Infact SL is a huge advertising niche that is ripe for tapping into. Innovative companies have started to cash in, e.g. IBM has their own island in SL where residents (actually the IBM enthusiasts) live and interact with each other. “Harry Porter” was promoted through SL. Moreover, Toyota launched “Scion” brand in secondlife knowing there are millions of SL residents whom they can target and at virtually no cost.
So companies are targeting this platform to build their brand through word of mouth (may be I will talk about effective WOM in some other post). There are marketing companies whose entire business has been reshaped to specialize in brand marketing in Second Life.
How many times have we tried to search something in Google™ and got a relevant result? I guess the percentage of relevancy is a debatable topic here and this forms the very outline of this article. Though most of my search is very much confined within the contours of Google™ itself. Still at the end of the day I am not happy with my search results or there could have been better results to my search.
Now del.icio.us™ (pronounced as delicious-http://del.icio.us/, parent company being Yahoo™) is a new social bookmarking web service for storing, sharing, and discovering web bookmarks where a tag (it is a relevant keyword or term associated with or assigned to a piece of information e.g. a picture, article, or video clip) is used to search.
Now what is the difference? The difference lies in the way both these websites search mechanism works. Google™ uses an algorithm where its spider crawler searches through its vast and extensive database to find the website. And del.icio.us™ uses tags that have been assigned with the links by this users and it also gives us a rating mechanism wherein we can see which page have been rated the highest in terms of usage.
But aren’t we looking for a specific webpage rather than website? That’s why I believe that search through del.icio.us™ is a better proposition altogether than google when the question is about finding relevant webpage.
And if people may ask why del.icio.us™ will be successful? I will say that now since the world has shifted to Web 2.0 where more and more portal is giving its customers more & more control, so why not in search?
Remember Marlon Brando in 1953 movie “The Wild Ones” as a leader of a motorcycle gang riding high on Harley Davidson. Or for that matter our very own Saif Ali Khan in a stripped Calvin Klein out of his jeans. What is the common factor among these two examples? They started a trend- Brando’s case a motorcycle craze and in Saif’s case a symbol of Metrosexualism.
Few days back I was discussing about the same topic with a friend about how can companies tap the market by using “trend” as a tool. Since our discussion was on how we can spot the trend as an effective source and further use it for revenue generation, we comprehended certain problems. For example, sometimes we say isn’t this a new trend but the same trend withers away slowly. That’s the reason sometimes companies can’t rely on it. But what matters most is to understand the subtle indication towards an effective trend.
Now the million dollar question is to analyze and measure the trend to its prime effectiveness.
First of all, our actions and behavior are becoming more universal since we are living in a global village. So this becomes easy for a company whose products have a universal appeal.
Secondly, it’s not about matching the trend with your product but its all about matching the product with the trend. In this way companies won’t fall into the trap of “trend perplexity”.
This can be done by using effective positioning strategies for a product with little scope for doubtful positioning in the mind of the customer. This way companies can leverage the brand value for a sustainable period.
Though the list is not exhaustive still this way companies can have an extra edge from its competitors.
Time and again we have seen that companies are learning the best practices from competitors and emulating it with their own better practices to a certain degree with a hallowed notion that it may give them an edge over the competitors. Now the question is what are we fighting for? The most probable answer would be market share.
Market share can be expressed as a company's sales revenue (from that market) divided by the total sales revenue available in that market. Now, I see a fallacy in the statement. So the article will talk about this myth per se.
The key word from the above statement is “from that market”. Now companies before launching new product have already predefined the market -– they would perhaps say that this is the market that have been segmented, these sort of customers we are targeting and this will be our positioning strategies, and so on and so forth.
Now the question remains that how much have we squeezed from the market or do we have a leeway? Taking an example it will be clear that fighting for market share isn’t the solution because you never know what is there in offering in the next turn.
It is hard to see how PC manufacturers' margins quickly shrank in the 1990's. The cause was not competition among industry players, but the superior bargaining power of their two primary suppliers -- Intel and Microsoft (referring to Michael Porter’s 5-Force Model). In this industry of publishing too, substitutes have become the primary source of competition as readers' attention is diverted to other forms of media.
So rather than fighting for the existing pie, companies can create that space and can take advantage over it (referring to “Blue Ocean Strategy”).
Now the question remains that are the companies in a flexible position with its products/services to implement two key elements – Strategy & Execution? If the company is in a position or can be in a position to take that strategic plunge, then surely the chances to get caught in the vicious fight for market share is over.
The topic is as elusive as its significance. Nowadays companies are trying to implement third generation strategies through second generation organizations with first generation management. But have we forgotten about the key element of it all- called the customers?
Now the customer over the period of time has evolved to be more demand frenzy, irrational, conscious and educated. Companies can’t fool them by saying “customer is king” or “customer is our partner”. Companies have dubbed words like customer care, customer satisfaction etc to please them (Though I find marketing in tune with sexual terminologies like market penetration, brand intimacy etc, though it’s a topic for some other day). Still at the end of the day we have to ask two questions to us.
1. Is the customer happy with us?
2. How can we match customer’s perception of satisfaction with our existing process?
I will try to exemplify with an example. A customer enters a retail shop, fully drenched with some bags in her hand. Now the immediate service would be to take her bags from her hand and make her comfortable in a seat. But at that point of time, the A.C. is not working or some foul smell is around the shop. So what is the end of the story - dissatisfied customer. Isn’t it? (I hope we can have as many examples as possible on this regard).
So the crux of the topic is “companies should try to extract the intangible aspect called EXPERIENCE part into customer buying”. Since more & more companies are attaching service aspect to their tangible product, hence the companies should try and make a good experience for the customers while buying.
This article revolves around the application of game theory to several irreverent issues associated with the markets especially oligopoly market conditions. It has led me to examine the changing nature of organizations and economic institutions, in response to the changing external environment, and to repeated strategic interactions, such as the rivalry amongst the small number of sellers in an oligopoly. So we can try to learn the adaptive strategic market behavior in an oligopoly market using this concept named"Game Theory" by Dr. John Nash.
Here, I have taken the case of oligopoly market condition where the market is dominated by small number of sellers (players) and after a certain period of time they are very much aware of each other’s actions. So within the framework of repeated interactions between different sellers, rationality demands a high level of pattern recognition, memory and computing. So the concept of “Bounded Rationality”comes into play where the players’ memory, computing ability or even competences are retarded which may however be sufficient to generate the set pattern or behavior in an oligopoly market.
Game theory champions say that "Compete without destroying the pie and cooperate without getting your lunch eaten"in business.
So, through Game theory, competing business can cooperate to achieve win-win situations for all players in the market. Game theory also points out the importance of repeated or ongoing interaction between businesses.
If, for example, two competing businesses (let’s take an example of retail stores with similar business models) are playing this game just once, then each has an overwhelming temptation to undercut the other since they are very much aware of the competitor’s strategies. But suppose they are in this business together for the long run, and are trying to achieve a cartel that keeps prices high (I am taking only the prices i.e. profitability aspect as of now). If one of them undercuts the other, the gain is temporary.
So what happens here is - when the other store finds out that the first one has cheated on their agreement, it will not trust the first any more and will retaliate by lowering its own price (in most of the cases). This will reduce the cheater’s future profits below what they would have been if it had honored the cartel agreement. So the cheater suffers in the future in exchange for its immediate gain. If the future is sufficiently important in its calculations, it will be deterred from cheating in the first place.
So, these situations gives us a live business scenario which can be further thoroughly understood by in-depth study of game theory and oligopoly market and the inter-relations amongst them.
P.S. This article shows how "Game Theory" can be utilized to gain the maximum in a given business paradigm.
First of all, I don’t have to say what “Blog” is. We all are learned people and come amongst the educated lot, right? But how many of us have thought Blogs as a medium of learning marketing (may be I am being too bold about it?).
Still I will try to substantiate on it.
As a management student, time and again we were taught marketing strategies; how to comprehend customer’s perception and fiddle (pun intended) with it to make the most out of it. Taking the perspective from the time of Henry Fords to Steve Jobs, we have seen how business models have changed over the years from “Production Era” to“Customer is our Partner”. So has marketing; as it has evolved over the period of time.
For example, when I started writing this blog, I just wanted to share my thoughts with people across the world (and thanks to Google for giving me this platform). Then the vital elemental question arose.
· Whom am I sharing with?
· How can I have more people watch my blog?
All these questions took me from “what I want to give (show)” to “what they want to buy (see)”. Now these two questions in a way exemplify how marketing has shifted!
Now for a modern marketer understanding these two basic questions will do wonders. Isn’t it? This is the crux of the whole topic where blogging has helped me to understand (though in a micro scale) how to sell (show) your product (blog) when your customers (viewers) are demanding and to some extent like a baby! So treating my viewer as my baby, I am still trying to understand “www effect (what, when & where)” aspect of any product (in this case it’s a ‘Blog’).
Over a decade back, the internet heralded a fundamental shift in the economics of information. And the shift continues with web 2.0 taking shapes in the form of Wikis, Blogs, Virtual Games etc.
These technological shifts have revolutionized the conventional Bricks & Mortar business models. There are a number of spectacular examples of totally new companies that have come from nowhere and have scored huge successes – YouTube, MySpace, Blogger, Wikipedia etc which are forming the contours of Web 2.0. At the same time, some large organizations were merely scratching their heads asking “What happened there?”
Exemplifying how technology has shifted over the years...
Web 1.0 ---->>Web 2.0 Britannica ---->>Online Wikipedia PC Games ---->>Second Life CD Now ----->>iTunes PointCast ---->>You Tube, Bit Torrent Personal Websites ----->> Blogs, My Space
But there were some organizations which were prompt to act to this shift. They understood that internet is not a toy for technologists but a new channel for distributing products and services of different types. So they ventured in and the result is that major “Bricks & Mortar” business models have some kind of a presence in the web.
By now, I guess most of you have understood the crux of the article. But one major difference between these two versions (i.e. Web 1.0 & Web 2.0), is the involvement of the customers which forms the DISTINCT DIFFERENCE.
If technology allows new communities to emerge (i.e. Orkut, Myspace etc), then we can do more with the power of “e” (referring to internet). We can design products, sell the products, diffuse information about the products, help each other to use the product or even fix bugs (if necessary).
One of the interesting aspects of web browser is not its extendibility but its applicability and I will try to extend my limited source of information & knowledge to clear it up a bit.
The next disruptive innovation (if it is not a bold statement to make) will probably come with the use of 3-D space as a browsing platform. With bandwidth augmentation, increasing computing power, rapidly improving technologies it is possible to create a 3-D environment (I am not getting into the nitty-gritty of it as it beyond the scope of this article). E.g. Try out a shirt off a virtual shelf and look at yourself in a virtual mirror before buying it. Won’t it be interesting? A 3-D environment can radically change how things are bought and sold.
Still the million dollar question remains - Is it time for transformation? Transformation from real to virtual world and back!
Take this for instance. “Word of mouth” marketing’s basic structure depends on people talking or discussing amongst themselves which is another form of gossiping (both with positive and negative connotation). So I guess by now the exuberant marketers’ eyes are well lit with this notion where women can be used for effective Word of Mouth marketing because they have an inherent trait of information sharing than their counterpart’s i.e. males.
Take this for instance. “Word of mouth” marketing’s basic structure depends on people talking or discussing amongst themselves which is another form of gossiping (both with positive and negative connotation). So I guess by now the exuberant marketers’ eyes are well lit with this notion where women can be used for effective Word of Mouth marketing because they have an inherent trait of information sharing than their counterpart’s i.e. males.
