Hashtag #shareacoke

 

Coca cola

 

 

We all loved when we found our names printed on a Coca-Cola can or bottle on the shelves at the grocery store.  According to some customer reviews  seeing your name on a big brand such as Coca Cola, makes it more personal. “Share a coke” campaign  first started in Australia in 2011.  After the great success in the Australian market, the campaign expanded on another 80 countries around the world.  In 2014 the “Share a Coke” campaign was introduced in the US market. This campaign boosted the sales in U.S. by 2%. This raise on sales hadn’t happened in a decade for Coca-Cola.  The Coke bottles had common names such as Jessica, Matt, Alisha and more, some buzz words such as friends, BFF and more.  For those who had a name that was not really common like mine, Coca-Cola would let people print their personalized “Share a Coke” bottles in some designated kiosks.  Also you could go online on the Coca-Cola website and create your own virtual bottle and share it on social networks. A lot of pictures with the personalized Coke bottles were shared on the social networks using the hashtag #shareacoke.

Coke

 

 

In the US, the company printed bottles with the 250 most common names. In UK  the company printed bottles with 1000 most common names.  I was kind of surprised by this fact. Since US is a bigger country than UK one would think the number of names chosen to be printed would be higher. The personalized bottles were introduced in the US market in June 2014.  They were sold on the grocery stores and vending machines.  Lately, you barely see those personalized Coke bottles or cans on the shelves anymore.  Coke is switching back to its standard labels in US.  This campaign was only  a temporary campaign.

What played a major role in this global success?

Coca-Cola made a temporary change in their production line globally, by customizing its product.  I think what played a major role in this campaign was the supply chain management. Making a change like this on the bottles and cans, especially when this change is applied to the global markets, supply chain is definitely a major part of this success.  According to a representative of Coca Cola, the “Share a Coke” campaign was a great success thanks to the supply chain flexibility.  The suppliers had to change their processes to meet the companies demand and the whole innovation demands that expanded globally.  Through this example the supply chain management can be seen as a profit driver instead of just thinking about it as a cost center.

 

This campaign was only temporary.  Do you think next year Coca Cola is coming up with the same campaign or something else “more attractive” to increase the sales?

What do you think are some other factors that played a major role in the switch of the product line?

 

 

http://www.foodmag.com.au/news/share-a-coke-campaign-success-thanks-to-supply-cha

http://www.independent.co.uk/news/business/cocacola-share-a-coke-campaign-boosts-us-sales-for-first-time-in-a-decade-9759739.html

http://online.wsj.com/articles/share-a-coke-credited-with-a-pop-in-sales-1411661519

Adidas Stepping Up Inventory Management

download

Adidas and Nike have been in competition since the beginning. Both companies sell similar products, including shoes, clothing, athletic equipment and many more things in the sporting world. As a result they are selling to the same target market, and customers have to make the choice based on what they are purchasing. They both are very popular and have a huge customer base. They are constantly competing every year for sales and are always trying to top each other. They each are so well managed and have such developed business techniques that it might seem hard to improve more than they already are. Nike might be more popular in America but Adidas has a strong grip in Europe, and has rarely shown signs of weakness.

However recently Adidas has been struggling to keep pace with the retail powerhouse that is Nike. Third quarter sales for Adidas did not meet projections, and this set off alarms for management. Adidas golf alone has gone down 29% from this time last year, which is over 180 million dollars. To combat this Adidas has vowed to drastically increase inventory management. The company is on a mission to keep surplus stock down to combat holding costs. Analysts claim that if they can cut surpluses it will turn company earnings back towards projections.

Adidas is especially worried about their golfing line because of how expensive it is and how quickly new products are developed. If anyone has ever shopped for golf clubs you will know how crazy expensive they can be. We are talking about a thousand dollars for a good set of clubs. Customers constantly want the newest and most high tech clubs available. So if they are overstocked on a certain set of golf clubs and a new and improved set is released, it now becomes much harder to sell the surplus and they could be stuck losing value the longer they hold them.

They even decided to “not chase sales” for the second half of 2014 in attempt to focus more exclusively on their inventory management. They are trying to reduce inventory to further increase profit. Better inventory management gives Adidas the flexibility to react quickly to market sentiment, and adjust to the popularity of certain items over others. If they have less quantity of a unpopular product in their inventory then it minimizes potential loss on unsold goods.

Adidas is confident that increased inventory management will grow sales and margins in 2015, especially in their golfing department, returning them to profitable levels.

 

Do you think Adidas made a  smart decision to step away from emphasis on sales to focus more on inventory management?

Will better inventory management allow them to surpass Nike?

How important do you think inventory management is for companies like Adidas and Nike?

 

adidas

 

Sources:

http://seekingalpha.com/article/2660085-adidas-addyy-ceo-herbert-hainer-on-q3-2014-results-earnings-call-transcript

http://blogs.wsj.com/source/2012/11/08/adidas-is-fast-catching-nike-in-china/

http://www.wallstreetdaily.com/2014/11/11/adidas-nike/

Bigger than Chinese New Year

Have you checked your calendar today? Do you know what day it is?

Many of us living in America look at November 11th as any other day on the calendar. Many people are also celebrating Veterans Day.

But in China, they are celebrating Singles Day.

One might ask, what is Singles Day? Singles Day is a holiday invented in the 1990’s in response to Valentines Day. Instead of promoting love for one another, the Chinese created an anti-love holiday promoting the single life. It is celebrated on 11/11 because of the connection between singles and the number ”1”. In 2009, China’s largest e-commerce company Alibaba Group had a vision and took a new interest into this holiday. They morphed it into a multi-billion dollar e-shopping holiday (similar to Black Friday). It turned into the greatest 24-hour cyber-spending blitz in the world because of the deep markdowns.

This holiday hasn’t always been about shopping. Below is a graph showing how much sales have grown for Alibaba’s e-commerce sites Tmall and Taobao Marketplace after reinventing this holiday in 2009. Alibaba was able to improve sales drastically by using quality to improve profitability. By reducing costs for one day and increasing productivity, we see profit increases.

Screen Shot 2014-11-10 at 11.05.16 PM

American consumers spent $2.9 billion last year on Black Friday and Cyber Monday combined, compared to Alibaba totaling $5.8 billion in sales on Singles Day.

As we learned in class, quality is subjective, and perception is reality. This holiday was spread only by word of mouth. How crazy is it than within only three years, Singles’ Day has become the biggest 24-hour shopping event in the world? Alibaba turned it into a Hallmark Holiday and is now sweeping the market. Their stock is currently up 4.59 on the NYSE.

With this busy of a day, one thing that needs to be taken into consideration is inventory management. It is crucial to have a management team dealing with inventory related costs. Similar to Black Friday/ Christmas time having seasonal employees, do you believe they should have seasonal positions for Singles Day? Or it is not necessary similar to Valentines Day not having extra added employees?

Positions needing extra help begin with setup / ordering costs. Preparing purchase orders and managing inventory is essential to stay organized. Delivery charges are also another thing needing to be tracked. Holding / carrying costs will also need to be managed, along with shortage costs. This might all seem simple, but with $5.8 billion in sales in one day last year, these are a lot of things to keep track of and manage.

Leaving you with a few questions, how likely are you to participate in a Hallmark Holiday like Singles Day or Black Friday?

Does working on a management team during a day like this sound appealing to you?

What difficulties would you find in the management area of working on a day like this?

 

 

http://money.cnn.com/2014/11/10/investing/alibaba-singles-day-china/index.html?iid=A_MKT_News

http://www.businessinsider.com/singles-day-is-chinas-cyber-monday-2014-11

http://www.marketwatch.com/story/alibabas-singles-day-bigger-than-black-friday-2014-11-10

Bank Robbers (Student Loan Debt)(Got Job?)

Nearly 20 million Americans attend college each year. Of that 20 million, close to 12 million loan annually to help cover costs. In Europe, higher education is more highly subsidized for students and funded by the government. In parts of Asia and South America most post secondary education is still private with little funding from the governments. It seems like the United States is creating a huge market for student loans to become a business. We ask ourselves is this ethically right to have that high of an interest rate for students who graduate working.”The average sticker price in 2009 was about $35,000, but the average price people actually paid was around $21,000.” It’s hard to estimate what college really cost.

Are student loans even a choice anymore? Seems like now 90% of the people who graduate high school try to pursue some sort of degree or certification of a higher level of degree then a simple High School Diploma. Student loans have become a business itself. Banks daily are robbing students by setting an interest rate so high. Many students who I know personally have graduated with top degrees are struggling, competing with hundreds of other students for jobs that will only probably pay the 30-40 thousand a year. The student debt is just not fair, the rates are higher then ever before. Even if one were to find a job immediately upon graduation, depending on his/her school, they could spend years just trying to pay off their loans. Banks, in a sense, are robbing students of their financial freedom, and essentially are creating a form of “debt-slavery”.

Student debt is not just a financial burden one takes on in order to get a good education anymore, it has consequences that reach far into the future. In the past fifteen years student debt in private schools has been raised from 50 billion to now being more then double at 120 billion dollars. Now for the Public schools it has reached almost the same from 45 billion to more then doubling to 100 billion dollars. That being said, I believe banks are the main reason why students cannot afford a higher education as well as pay it off. At the end of the day the banks job is to drain every dollar and gain every percent out of our pockets. We can ask ourselves is this Social Responsibility of business? Is it ethically right to turn education into a business?

debt

Would you like some “Free” with that?

freeburger

This just might be a possible question asked by a McDonald’s employee in the imminent future. Currently, the only reward you get for eating at McDonald’s is: well, the food itself. McDonald’s does not have a rewards card to attract customers to stop by because of additional points or freebees. Though, it sure can use one.

The traffic in McDonald’s in on a steep decline. Frankly, their forecast also suggests a continuing future decline. We have previously discussed in class the need to identify the reason for having a negative trend and making adequate changes and adjustments to avoid declining sales. This is exactly what McDonald’s is doing. They are reconsidering their strategy and trying to come up with a way to retain their clients, meanwhile attract more clients who can make up for the decline over the recent years.

To create this new traffic, McDonald’s designed what you can almost call a new product, a loyalty card, which it is planning to introduce in the upcoming days. Other food chains such as Panera, Subway, and Starbucks already have some form of a loyalty card, and they all have seen a greater rate of return after its introduction. People love when they get a good deal: a purchase made on sale or just a freebee. Therefore, people are choosing places that reward them for their loyalty with rewards-only deals, or accumulation of points which eventually leads to some discount. This also helps keep customers loyal.

The three major fast food chains: McDonald’s, Burger King and Wendy’s have yet to come up with a loyalty card. Being the first to introduce one can definitely be a competitive advantage for McDonald’s. This can help them further differentiate themselves from the other two.

In addition, McDonald’s market consists of people who are relatively small spenders, which is what brings them to McDonald’s, a food chain with fairly low prices. Introducing a loyalty card that can save them even more money or get them a better deal will definitely be something these types of customers are interested in. Another amazing benefit of a loyalty card is that companies can track client’s purchases. They can then use this information to customize their marketing with coupons and sales that are specific to your interests. Therefore, this is an ideal solution for the decreasing sales at McDonald’s. The loyalty card will keep clients from going to the other places, which do not reward them for coming in.

Although many companies focus on improving their processes through efficiency and cost cutting, without sales, there is no need for production at all. McDonald’s is currently in need of increased sales and traffic. And although investing in the design and creation of a loyalty card can be quite costly, I believe it will definitely pay off with increased sales and loyal customers.

 

Do you think the loyalty card will keep their clients loyal? increase traffic? increase sales?

What is your experience with loyalty cards?

 

http://consumerist.com/2013/10/01/mcdonalds-testing-rewards-program-for-customers-using-mobile-devices/

http://www.businessweek.com/articles/2014-11-03/mcdonalds-and-other-fast-food-chains-step-up-battle-for-loyal-customers-with-rewards

The Dark Side of Groupon

Everyone loves a great deal, whether it’s for a casual restaurant or luxurious spa. If you’ve been living under a rock, Groupon is a convenient online site that finds these steals for consumers without clipping coupons. It claims to help struggling local businesses gain new customers and sales, but merchants in the service industry must beware that Groupon may potentially hurt their business instead of improving it. The online site looks out for the consumer’s best interest and not the business.

Local businesses look to Groupon as an alternative to traditional advertisements. Groupon will draw in merchants by creating a promotional deal up to 50 percent off in which they promise sales increase and new clients. According to Huffington Post writer, Amy Lee, “one merchant proclaimed that signing up for Groupon was the “single worst business decision” she had made. Her story echoes other merchants who have claimed that Groupons result in unprofitability, administrative nightmares, and, to cap it all off, that they don’t result in new regular customers.” Groupon makes it hard for merchants to profit from these low deals. In some instances, businesses in the service industry end up losing money.

I’ve had the experience of working with Groupon at my current salon job. The company has been struggling so they thought it would bring great opportunity to gain new customers and increase sales of monthly memberships. I believe bringing Groupon into the company had the opposite effect. I’ve found that most of these customers already existed in our system and only handfuls were new. In addition, clients who seek bargains will wait around for the next deal to pop up on Groupon. I kept seeing the same, reoccurring customer purchase one Groupon deal after another. They would never sign up for memberships after their deal was used or expired as the company anticipated. After we would stop running the deals, majority of our clients would discontinue using our services and search for better deals elsewhere. In this case, I believe Groupon did not work in our favor and devalued our company even more than developing it further.

Sources:
http://www.bu.edu/today/2011/groupon-bad-for-business/
http://www.huffingtonpost.com/2011/06/10/groupon-merchants_n_874896.html
http://www.pdco.com/node/88470

More Money or More Free Time?

Which would you rather have: More flexibility at work or a higher salary? This is the opening line of the article, but a very critical question regarding our lives in the working world.  According to the survey by Citigroup and LinkedIn, 64% of people are more likely to get more flexibility at work than a pay raise. This seems fairly reasonable, but once the raise hits 20%, the people that want more flexibility decreases to about 47% and finally a 30% raise drastically decreases flexibility favorers to 28%. This article demonstrates how managers can create a happier work environment with a little more flexibility.

At my current job, my boss is extremely flexible as long as I am in on Fridays to do our weekly payables. I don’t have my own family to go home to, but my substitution for that is being a student. My boss offers me days off when midterms and finals are around because he understands the importance of school. I’ve seen some people at work needing to attend family issues without causing a negative atmosphere at work. My firm really does a good job in understanding what employees really value, and that could be a really big reason why we are constantly growing every year with a friendly vibe around the office.

However, overall it seems that people do feel that a work-life balance is desirable. This article then transitions to viewing woman and men and their views on a work-life balance. Apparently, more than half of men talk about a work-life balance to other men, while 78% of woman said they never heard a successful man talk about the difficulties with work and home. Both men and women want to have a work-life balance, but it seems that men don’t generally speak about these issues with woman. Perhaps this is some sort of patriarchal agenda men feel they have to uphold. Being in the year 2014, patriarchal mindsets are declining and more and more men are becoming more vocal. Max Schireson quit his job as a CEO from a billion dollar company to spend more time with his family.

I’ve noticed myself talking to both genders about working and being at school. I manage it fairly well, but when it comes to school it always trumps working. It really just depends on the person you are and especially your age. Coming out of school with a degree, I’m positive these young individuals will focus on their career, but as time progresses their views can change.

So this leaves this question: Would you rather have more flexibility or a higher salary? Does your age or gender lead you to choose one over the other?

 

Japan’s Car market conundrum

In class, we discussed the idea that productivity is a measurement derived from how much outputs are produced over how many inputs are put into the production. Knowing how important production is, I decided to compare the math with the practice of making cars.

An article in the Economist discusses how large Japanese automobile manufacturers such as Nissan, Toyota, and Honda make money by large productivity. The article reports that many car makers believe that a firm must churn out at least 6 million cars in order to make money. This makes sense, as more production eventually becomes cheaper due to economies of scale.

However, the main purpose of the article was examining how market followers, such as Mazda, Mitsubishi, Suzuki, and Subaru are making a profit without the mass production. Being smaller firms, they do not have the means to compete on volume, as is the norm with the market leaders. To further emphasize their desire for independence, many car markers have thumbed their nose at merging with their larger competitors, instead focusing on exporting their cars to the US, and capitalizing on cheap labor from places such as India. So, through a mixture of tax breaks and the focus on improving efficient consumption of oil, smaller car manufacturers have been able to cling to their independence.

However, there are problems on the horizon. It is apparent that many of the large car manufacturers are focusing on new fuel mediums. This is due primarily to the effect oil pollution has on the environment. Pro-environmental pressures are making noise about continued development of oil-powered cars. In addition to these pressures, government officials add further strain by passing stiff taxes on the purchase of oil. It is known that the development of cleaner fuel will result in more jobs, but it also puts the smaller car manufacturers at a disadvantage.

In this market, it can safely be assumed that the market followers should have merged with the leaders. In this case, productivity is, indeed, an important component. In the current situation, these car manufacturers enjoy freedom from the sway of the big three. However, in the long run, the tax breaks and oil efficiency will be phased out, and once more, productivity will be the primary dominant measurement of success.

However, falling oil prices may stave off environmental watchdogs and provide a saving grace for the smaller companies, allowing them time to transition from oil to another fuel source. Also aiding these smaller companies is Japan’s history of supporting failing businesses. But it is uncertain whether or not this will be enough to prop up the smaller companies, as Japan has just exited a deflationary period, resulting in a weakened currency and a more expensive bailout bill .

Given all of this, what do you think that the followers should do to protect their business? Do you think that gas prices will afford enough protection? Will Japan continue their history of bailing out failing companies now that they have weaker currency?

“Lots of Oomph; Japanese Carmakers.” Economist 25 Oct. 2014: 68. Print.

“Replacing Oil: Alternative Fuels and Technology.” Replacing Oil: Alternative Fuels and Technology. Web. 10 Nov. 2014.

NFL Marketing for Redemption: Progress Analysis

In recent media, most people know who Ray Rice and Adrian Peterson are in a negative light, due to domestic abuse. For about a month, the NFL took a lot of fire for how the league was going to respond to the situation. The NFL since then, has taken multiple actions to show that they have remedied the situation and to raise their reputation amongst their female fans. One such action, first was taken by the league front office; in which commissioner Roger Goodell hired 4 advisors all of which are female to handle situations in regards to players and domestic abuse. This was quickly made public to show that the NFL was currently working on a policy .

The next action they took, was through extending the duration of their breast cancer awareness month. Every year, the NFL generally sets aside 2 or 3 weeks to honor breast cancer awareness month, and those women whom are survivors of breast cancer. This year, the NFL put aside a whole month towards breast cancer awareness in light of the the incidents regarding domestic abuse. During this time of the seasons players wear pink accessories to honor breast cancer awareness and this year the NFL teams went all out.

Certain NFL teams went all out in others ways, such as bars, clubs, merchandise stores and beauty clubs specifically for their female fans. On October 5 in Carolina was the debut of their style lounge for their female fans and they were open to using the service. Other teams that have such lounges located in their stadiums are the New England Patriots, Washington Redskins, Baltimore Ravens and Atlanta Falcons. By making this action, this showed that the NFL was really looking to tailor to their female fan’s for forgiveness of their players actions.

One way I saw the NFL contribute to this marketing scheme this past weekend was the commercial “NFL Player’s Say No More“. What the commercial is ultimately saying is to take action against domestic abuse, and if someone says something help them remedy it or point them in a direction to remedying it. Having the players as the main subject tells the public that they understand public incidents are unacceptable and that with the prestige of playing a professional sport comes your life being under the public eye.

As a result of all of these marketing schemes the results show that it has paid off. According to a random poll two-thirds of female fans and three-fourths of male fans were not affected by the incidents surrounding the NFL. However, most fans are not confident in their behavioral change policy.

Do you think the actions the NFL has taken has redeemed their reputation amongst female fans? What is your opinion on the actions of the NFL? Would there be anything different that you would do?

 

 

 

Sources:

http://www.sportsbusinessdaily.com/Journal/Issues/2014/10/13/In-Depth/NFL-marketing.aspx

http://www.sportsbusinessdaily.com/Journal/Issues/2014/09/22/Leagues-and-Governing-Bodies/NFL.aspx

 

Olympus Has Fallen

I am currently taking a photography class at school to fulfill the “Arts and Literature” requirement.  On the first day, we were told that we could use any camera that we wanted to use to take pictures for class, as long as it wasn’t the camera from our phones. When I got home later that day, I started looking around my house to see if I could find the almost seemingly ancient relic that is the Digital Camera.

I kept looking around my house and never actually found one so I decided to hop on EBay and order one for myself. I decided to order an Olympus Camera for two reasons.

 1.) I vaguely remember that it was the brand of the most recent family camera that we owned (ages ago).

2.)On EBay, the Olympus brand had much lower prices than its competitor’s (like Sony, Canon, Nikon). I actually ended up buying the camera for $2.50(It was a 16MP camera, it worked, and the model is below).

Olympus 16MP Digital Camera
Olympus 16MP Digital Camera

During my search, I began to notice a constant theme, which was that a simple “Digital Camera” search on EBay resulted in the majority of cameras being sold were of the Olympus brand. This intrigued me and I decided to do some more research on the company.

With the rise of camera phones, the only companies that have a firm grasp on the camera market are Nikon, Canon, and Sony (likely because of their vast resources, brand names, continued innovation, and they can sustain losses better than smaller companies).  With the rise of camera phones, this is no longer a market that can sustain a “cheaper” alternative camera company. Olympus has less than a 7% market share and has failed to generate a profit from its digital camera segment in the past three years.  In terms of digital cameras, the three corporate camera giants has seemingly been able to produce small profits/get by with losses in the digital camera segment because of their brand name and also because their huge profits from their optical premium lens cameras allow them too.  Olympus’ decline has caught management off-guard, so much that their actual sales were less than 2/3 their forecasted sales in their most current year.

Olympus’ biggest advantage was that they once had many patents revolving around having “light-weight” cameras and were held in very high regard in the market in the 2000s. This advantage has quickly disappeared with camera phones also being “light-weight” cameras. A current great advantage is that one of their premium optical lens cameras, the OM-DE-M10 Company Camera  (not a digital camera) is regarded as a great, cheaper alternative to the pricier Nikon, Sony, and Canon cameras.

Olympus OM-DE-M10 Company Camera
Olympus OM-DE-M10 Company Camera

Their greatest current disadvantage is that they do not have the deep pockets that the huge corporate giant camera companies have. This is important because these companies continue to reinvest and spark innovation, something Olympus has seemingly failed to keep up with.  

 According to 24/7 Wall Street, who releases a speculative report annually that lists companies that are most likely to disappear during the year, listed Olympus as their 6th company most likely to be gone in 2014.

 There is no doubt that the company is in the decline stage. The EBay search alludes to an over capacity in the market. Their cameras also do not have a high product differentiation like the huge camera companies.

 Would you agree that they are in the decline stage? What advice would you offer Olympus so that they can prevent disappearing by the end of this year? Do you own a digital camera? Why or why not? What impact have camera phones had on the digital camera market? Knowing that even the huge corporate camera giants have problems sustaining profits in the digital camera market, what advice would you give to them?

Sources:

http://247wallst.com/special-report/2013/05/23/ten-brands-that-will-disappear-in-2014/3/

http://www.ukessays.com/essays/marketing/decline-stage-of-the-product-life-cycle-marketing-essay.php