Are Super-size Smartphones the New Tablets?

Over the years, the sizes of smartphones are getting bigger and bigger. Designers are beginning to create phones with the idea of the bigger the better. The best sellers for smartphones are the ones with the larger screens. The resolution for the screen is as high as 1080p. Smartphones are becoming the size of tablets. This means small tablets can soon replace smartphones by implementing it with the same functions.

For example, Android smartphones have grown in size over the years, from “4 inches, quickly followed by 4.3 inches and 4.5 inches, and now up to 5 inches and even beyond” (Tofel 2). Android created their products according to their consumers’ desires. The majority of the people wanted larger screens of “4.5 inch display or larger” (Tofel 2), which made using it more enjoyable. Most people use their phones for web browsing rather than to use it for calls. A larger smartphone means users will need to hold it with two hands. The convenience and mobility of using it with two hands is not a problem, because most people use it while they are sitting down. The majority of the consumers want larger screens, which is about 77% of the people. What about the other 23% of the consumers who do not desire the large screens? Android will lose about 23% of their consumers to their competitors with smaller phones available.

The growth of smartphone functions has made it necessary to increase the screen size. The more functions that are put into the phone, the more pixels are needed for the graphics to look visually good. Research has shown that most consumers’ ideal good quality smartphone are the ones that offer the most functions and has the largest screen. It is also viewed as a better value for their money. The dimensions of quality define this as user-based. It is the products with the desired attributes that satisfies the consumers’ needs the most. In this case, smartphone consumers want more functions and a larger screen. The product attributes only meet the needs of majority of the consumers. Android phones are designed to appeal to the majority and neglecting those who do not want a larger screen. The problem with this is that, not all consumers want the same product attributes. The quality is determined by the consumer’s needs and wants them self.  The product attributes need to meet the customer’s expectations for them to be satisfied.

As a consumer myself, if a phone can do more than other phones can for the same price, it would be considered a better deal. The size of the phone does matter to me, as it has to fit in my pocket for convenience. I would prefer to have a smaller phone than a larger phone that requires two hands to hold. My idea of a good quality phone is different from other consumers because it has to fit my needs. The quality of a product is subjective and every consumer’s needs and wants are different.

 

Questions:

  • What is your idea of a good quality phone?
  • Is it true that most smartphone consumers want bigger screens?
  • Do you think tablets will soon be replaced by smartphones?

 

Articles:

Beer Can Fan

Have you noticed over the past couple years all the innovation that has been swirling around beer cans? It all started with Coor’s Light and their vented can and their mountains that turned blue when they were just chilled enough to get consumed. At first, Coor’s Light caught some flack for introducing such innovations to their beer can, but it seems that competing companies such as Anheuser-Busch and Miller Brewing Co. are also trying to get in on the mix.

Coor’s Light started this innovation craze by introducing their “vented” and “cold activated” can. Recently they have introduced their new double vented can which is quite hilarious. It seems that Coor’s Light is even aware of this hilarity as they put out commercials that are seemingly mocking their new innovations. Not to be left behind, Budweiser is introducing the latest innovation with their “Bow tie” can. It is designed with a kink in the middle of the opening to allow for easier drinking. The interesting thing about this can is that it actually holds less beer than their traditional can. Another smaller competitor, the Boston Beer Company ,which brews Samuel Adams, reportedly spent over a million dollars in trying to design their own innovative can.

It is interesting to see all these brewing companies investing so much into providing so many innovations when in reality it does not change the actual product that is being consumed. Beer seems to be a product that is defined simply by consumers choosing it for its user-based and value-based aspects of quality. There is no secret to why people buy beer. Top executives at Anheuser-Busch are claiming that with their innovations they are trying to target consumers who are “trend-setters” and like to be ahead of the curve. Surely the companies realize they they are not changing the product, but instead trying to differentiate it by adding to the experience of drinking. By adding certain innovative features to the can, companies are trying to add quantities to their product attributes. In reality, the actual beer is the primary product and its primary characteristics are not being changed or altered by the changes being made to all these different beer cans. If anything, the changes to the beer cans appeal to the dimension aspect of quality since they are creating additional secondary characteristics for a simple can. Adding features that supposedly allow for easier, faster, and colder drinking does not change what the end result will be from consuming beer out of these innovative cans.

Next time you find yourself ordering a beer, keep in mind that the new can you might have in your hand has been designed to help you with your beer drinking experience.

 

 

http://business.time.com/2013/05/11/my-beer-can-is-better-than-yours-aluminum-can-ovations-for-better-beer-drinking/

Nike Relationship with Livestrong Charity Dies!

A relationship that generated millions and branded Nike to what it is today has finally come to an end. After a nine year relationship, Nike is closing down its support with the Livestrong Foundation that former bicyclist Lance Armstrong has created to help cancer survivors.

Livestrong-Nike-Cancelled
NIKE LIVESTRONG DISCONTINUED

The footwear company is pulling the plug on all Livestrong merchandise off of store shelves. I know exactly what all of you are thinking, “Wait a Sec! That means no more yellow Livestrong wristbands?” Yes this is exactly what it means. They are discontinuing all footwear and clothing, so the shoes you just bought last week that retailed over $100 will now be worth nothing. Nike has generated over 100 million in funds to the foundation since 2004 and during the time accounted for about a quarter of Livestrong’s average yearly revenue.

The foundation said that change in its relationship will have no affect on the services it provided to cancer survivors. Nike said they would continue the support in other ways, but they weren’t able to provide specifics at the moment.

The company ended the sponsorship last October after becoming aware to the news of Lance Armstrong using performance-enhancing drugs and lied to Nike for over a decade. Mr. Armstrong is now resigned from chairman of the foundation and dissociated himself from Livestrong.

Stores like Dick’s Sporting Goods and Sport Authority are now severely hurting due to heavy inventory of Livestrong merchandise of exercise equipment and clothing that failed to sell. Consumers have already turned their back on the brand that was once so dominating and meant so much. The foundation that is based in East Austin, Texas, is looking for a new outlook and a way of rebuilding itself to what it used to be. A Spokesperson for the foundation said, “We want to steer a strong and independent course that ensures the long-term health and sustainability of the organization.”

The foundation has derived 1/3 of its budget from corporate and licensing sponsors, 1/3 from events, and 1/3 from general fundraising, according to chief executive Doug Ulman.

Livestrong still has some corporate sponsors, and still in the works for seeking more. “The foundation has taken other steps to reinvent itself, including moving its “call-to-action” day—which was celebrated on the anniversary of Mr. Armstrong’s cancer diagnosis—to May 17, the day that its yellow wristband was introduced.” The foundation has started new relay marathons all throughout Austin, while ending the sponsorship with the Austin Marathon in April after three years being the top sponsor. Nearly 500 runners associated with Livestrong have already raised $250,000 this year.

I just feel that after the foundation was basically led by an imposter is going to be really hard for the company to regain its trust in its consumers and hard to rebuild itself after an impact like this.

WILL THE FOUNDATION BE ABLE TO REBUILD THEMSELVES AFTER NIKE DROPPING THEM?

WILL THIS AFFECT THE QUALITY OF THE SERVICE THE FOUNDATION PROVIDES?

 

Sources:http://online.wsj.com/article/SB10001424127887323855804578511271244741516.html#articleTabs%3Darticle

 

Should GMO Foods be Labeled?

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People should know where there food comes from right? Or should they just accept the food that is given to them at their local grocery store or big chain store? I mean after all food is something that your body uses to provide nutrients to your body. Wouldn’t you want to know if the food you were used to was altered in any sort of way. With Monsanto and their GM Crops (Genetically Modified Crops) , which are crops that have been genetically altered by engineering techniques, such as corn or soybeans could be provided to you without you being aware that they are genetically altered and not the original crops that grow from the earth.

Monsanto claims that the Genetically Modified Crops are safe, but how are we to know for sure, but isn’t that what tobacco companies told us about cigarette smoking back in the 40’s and 50’s. Now after years of testing we know cigarette smoking is closely linked to forms of cancer especially of the lungs. Whose not to say in the future that GMO Crops will be closely linked to some disorder or disease. GMO’s have been around for about approxiametly 16 years, with heavy long term research being done mainly by Monsanto, whose research shows that they are safe.

There have been other research that says otherwise, such as research done by Michael Antoniou of Earth Open Source and Dr. Giles-Eric Seralini of the University of Caan in France.  Their research states that glyphosate and 2-4-D found in the GMO’s pesticides create  lots of health problems such as birth defects, neurological imbalances, cancers, embryonic deaths, and DNA damage.

Monsanto states they are opposed to current initiative to mandate labeling of ingredients developed from Genetically Modified seeds in the absence of any demonstrated risks because such mandatory labeling could imply that food products containing these ingredients are somehow inferior to their conventional or organic counterparts. Mandatory labeling of genetically engineered foods and organisms in the United States has been proposed but not been made into a bill or law on the national level. Many countries have actually banned Genetically Modified Organisms such as Austria, Bulgaria, Germany, Greece, Hungary, Ireland, Japan, Luxembourg, Madeira, New Zealand, Peru, and South Australia.

I mean what was wrong with the way these crops were naturally created in the first place. Either, consumers should have the option of knowing whether their crops were genetically modified or not, in the same way there are standards on whether stuff is organic or if an product doesn’t contain gluten.

So do you think that products should be labeled GMO or not? What are your thoughts about Genetically Modified Crops in general?

 

Sources:

http://www.ext.colostate.edu/pubs/foodnut/09371.html

http://www.monsanto.com/newsviews/Pages/food-labeling.aspx

http://www.naturalnews.com/038544_GMOs_solution_Monsanto.html

Sweet Mandy B’s Sweet Success

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Most students at DePaul University have encountered the delicacy of Sweet Mandy B’s at some point during their college education, whether directly or indirectly. There are the die hards (as often as they can get there, they do), the excuse makers (I don’t want to write this paper anyways, so lets go get cupcakes), the “I earned it” girls (who can justify the indulgence since they worked out), the special occasions (birthdays, weddings, the works), and the rest have either simply tried Mandy B’s or heard other students discuss it.

The number of students that Sweet Mandy B’s draws in on a daily basis is astounding; and students are only a portion of their customer base. There are people all over Chicago who are willing to make the trip to Lincoln Park in order to get Mandy B’s. In food and confection related industries, the quality is top priority since that is what consumers are truly after when they go in for a treat. In order to sustain such high quality management and fresh cupcakes, cookies, and specialty foods, just in time inventory is a must. Nobody wants to walk all the way there to spend money on a cookie that is stale or doesn’t satisfy that sweet tooth. Managing the way that baked goods are created, decorated, and stored in order for maximum freshness for the maximum amount of time appears to be something that Sweet Mandy B’s management has mastered, from my experience at least.

Another aspect of operations that is essential to consider in this industry is capacity. When people place orders for cakes, it is typically for a special occasion, in which case they need the cake at a specific time on a specific day. Cake orders and order patterns must be closely analyzed in order to increase staff during busy ordering times such as holidays or time of large events like graduation. Space and oven scheduling is another consideration, for only so many cakes can be baked as there are ovens. Sweet Mandy B’s seems to have this under control as well, for the entire second half of their store is available should they need to utilize that space, yet the don’t waste money keeping it lit or stocked when they are able to limit baking to the main kitchen.

Location strategy is interesting in this case, for Sweet Mandy B’s does not follow the typical “Location is everything” mantra. Rather it makes a product that is too good to resist, and people have no problem travelling from all over the city to pick up their pre-ordered cakes or stop by for a snack. However, their location is, in fact, intelligently placed because many college students do not drive, and the proximity to campus is a major plus. Its convenience also encourages students to stop by when they probably would not have made the trip if they had to actually plan for it and catch a train. With its thriving success, is there anything that could drastically hurt Sweet Mandy B’s sales?

 

HTC First to HTC Last

 

Facebook-hoaxImagine if you were Mark Zuckerberg, the CEO of Facebook, and your product attracted 175 million people on a daily basis.  I don’t know about you, but I would be thinking of other ways to capitalize on this already loyal fan base and try to introduce more products targeted toward their needs without stemming off the confines of what has made Facebook successful.  Hey, what about a cell phone?!

This idea has apparently caught AT&T’s eye when they decided to allow the new Facebook Home software to be integrated in the HTC First cell phone.

Facebook Home is software for your phone that allows Facebook to essentially take over your phone.  This allows users to take advantage of their already established social base on Facebook and communicate with these friends on their cell phone “more conveniently”.  It consists of features such as the cover feed that allows you to glance at your phone for photos and posts, chat heads that allows you to send and receive texts and Facebook messages in one place, allows notifications to be accented on your home screen and an app launcher.

To me, the advantages this product are allowing cell phone users to no longer have to pay a texting fee due to the chat heads feature and from a company point of view it allows Facebook to mass distribute its product without consumers having to buy a cell phone.   However, from a product design standpoint, I don’t think Facebook Home targets the cell phone market very well.  It tries to reinvent the cell phone world too much by focusing the cell phone software design around people instead of apps.  As a consumer would you enjoy having your cell phone constantly flowing with your friend’s pictures and status?htc-first-slide-01

Apparently the majority of Facebook Home users did not enjoy having their phone being constantly engulfed with their friend’s updates when the first month sales reports came back.  “BGR.com says that sources at AT&T indicate that fewer than 15,000 of the phones had been sold by the end of its first month.  By comparison, in the three months of the year AT&T sold 6M smart phones, of which about 1 M were android phones- an average of more than 300,000 per month. “AT&T then cut the original $100 price to $99 cents on-contract. The mistake HTC First made to integrate their product with Facebook home has seemed to have left them with an essentially useless product with a lot of inventory.  Now it is rumored that the HTC First will soon be discontinued and unsold inventory will be returned to HTC.

I would question management’s decisions during the product development stages when designing the product, how they reviewed Facebook Homes design, and most importantly how they tested the market.  If these stages were done efficiently I feel that AT&T could have better understood the consumer demand for the HTC First Facebook phone and could have been more aware of this disaster before it occurred.

As a consumer would the HTC First Facebook phone satisfy you?  How do you feel management could have avoided this disaster?

 

 

 

 

 

http://www.foxnews.com/tech/2013/05/13/no-home-for-facebook-at-att-htc-first-to-be-discontinued/
http://www.techhive.com/article/2039633/facebook-slams-brakes-on-htc-firsts-international-plans-following-poor-home-reception.html
http://www.facebook.com/help/558055177560569
http://www.guardian.co.uk/technology/2013/may/14/facebook-home-app-htc-problems
http://news.cnet.com/8301-1035_3-57329634-94/facebook-phone-who-would-buy-this-thing/
http://www.theatlanticwire.com/technology/2013/05/htc-one-isnt-saving-htc-facebook-phone/65486/
http://news.softpedia.com/news/175-Million-People-Use-Facebook-Every-Day-133744.shtml

Quality vs. Price

hAs a customer how do you measure quality? Would you settle for lower quality due to lower price? Does the economy hurt the companies that don’t lower price because people cannot afford the same quality with the reduced income? These questions are raised in the article “High Quality Products Is Key for Chicagoland’s DK Organics” on constructionequipmentguide.com. DK Organics emphasizes product quality over any other key factors such as price. Many businesses compete by lowering price for a product and then eventually which leads to lower quality. Many well established companies choose to not compete with lowering price or lowering quality but rather with adding features to their product to attract customers rather than losing their reputation. After all, a reputation lost takes a lot of time to gain back which some companies are smart not to lose.

However, it is independently determined if a company is willing to be known as a low price company that attracts most of the lower and middle class therefore does generate high profit. On the other side a company like DK Organics can still be stable in a bad economy with not changing their price but maintaining quality and continuing to stabilize their reputation as well. Measuring quality is different for each firm as discussed in class. Companies have to choose between value based quality to compete.

ISO 9000, quality system, requires the companies to focus on customer’s requirements, needs and expectations. ISO 9000 exists to guarantee equity in the marketplace. Reputation for companies are built through customer review and what type of customer’s shop at the stores builds the reputation for the companies. on DK Organics website it is stated on the home page that “Our material yard carries top quality mulches, composts, soils, stone and sand. “(dkorganics.com) Material yard is bold to emphasize quality regardless of the price. “high value experience every time!” (dkorganics.com) again refers to quality that the individuals will get out of the product which can be measured by customer’s satisfaction and the rich lasting result of the soil. DK Organics product can be purchased by individuals but it is usually provided through a contractor “a service” in order to receive the product, which could cost extra money but quality is still measured high.

When a product cannot be purchased by a customer by itself easily and needs a service provider to obtain the product also increases the value and quality of the product. This could be also considered a great marketing strategy to generate more revenue by adding a service to the product. DK Organics can be considered a great business because landscaping is very important and public places will always hire someone to do the job for them instead of doing it on their own, thus generating revenue for the company.

 

Sources: http://bit.ly/112Ni1p

KFC China: Straying too Far from Kentucky?

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Bloomberg Business Week featured KFC, a Yum brand restaurant, in two recent articles focusing on the brands Chinese storefronts. KFC, a household name in US fast food chains, has been suffering in several different aspects. Originally tied with the name “Kentucky Fried Chicken”, KFC has evoked feelings of unhealthiness with US consumers for years, and has suffered sluggish sales. However, the chains crowning glory has been KFC China which has been a start for Yum brands and been increasingly profitable.

Recently, however, KFC China has suffered from image issues and quality problems, and therefore there sales in China have been dipping. For KFC in the past, unhealthiness was not as much of an issue for its Chinese counterpart, because it brought a unique competitive advantage: its traditional American menu. KFC China took a different approach that may have ruined that competitive advantage, by trying to adapt the menu to the Chinese audience and adding traditional Chinese fare. So far it appears that this was not a wise choice, and consumers are left wondering what happened to their beloved American food. KFC needs to reassess their product design to match the wants of the Chinese customer base.

On top of this reconstructed image issue for KFC China, what may have been even more damaging was quality control issues. A history of poor quality issues can be severely damaging to a brand, especially one associated with the food industry. Consumers take extra precautions with what they are putting into their bodies, so when news of KFC chicken containing “unacceptably high levels of antibiotics” the chain suffered. This on top of already high concerns dealing with avian flu, made Chinese consumers even more skeptical about consuming this product. This illustrates, how damaging a quality issue can be for a brand, as discussed in Chapter six.

KFC China had been so successful in the past, that Yum has considered completely selling the United States stores in order to focus on those abroad that were growing at a much faster rate. However, if they continue to have these image and quality issues in China, getting rid of US stores may be a poor choice.  If KFC abandons its US stores, does that destroy its image of being a classic American restaurant even further? Only time will tell what happens to this brand, but it is crucial that Yum and KFC managers assess this project.

What are your thoughts on KFC and KFC China?

Questions for discussion:

1. Should KFC focus on one brand or the other? Or continue with both?

2. How should a major fast food brand adapt to international markets? Maintain their original image, or add traditional food, specific to the location?

3. Where to you see Yum and KFC moving in the future?

Article Links:

http://www.businessweek.com/articles/2013-05-16/kfc-loses-its-touch-in-china-its-biggest-overseas-market

http://www.businessweek.com/articles/2013-05-14/should-kfc-rethink-its-china-strategy

 

Beef Prices at an All-Time High a Good Thing?

In the recent months, commodity prices have soared to record highs, with the sharpest increase being in the price of beef. The reason for this increase is partially due to last summer’s drought, but it is much higher than most analysts predicted. This has begun to affect the profits of large restaurant chains such as Burger King, Wendys, and most importantly McDonalds.

1C7301038-130509_angus_hmed_1213p.blocks_desktop_smallIn early May, McDonalds announces that it would remove its Angus Third Pounders from their menu. The company said the removal of this burger was done to make room for other food options, but most experts agree that the profit margins are too low for beef items like these to remain profitable.

This has resulted in McDonalds and other restaurant chains to begin to retool their supply chain to put a heavier emphasis on chicken products, which is more profitable than beef. McDonalds has already begun to roll out new items such as the premium chicken wraps. This will definitely be more costly in the short run, but with rising prices, and more health-conscious consumers, it is a good long-term strategy.

With obesity at all time highs, and consumers becoming more health-conscious, this rise in beef prices could not come at a better time. Chicken is much healthier that beef, having significantly less calories and fat. With chicken prices being low, this could benefit both the restaurants and the consumer.

This situation can be compared to gas prices hitting an all time high in 2008.  Once prices hit the high, there was a sudden demand for more fuel-efficient vehicles, planes, trains, etc. They use less fuel, are much more efficient, and produce significantly less emissions that harm our environment. Similar to beef prices, consumers had no reason to switch to the better option until it became cost-effective.

In any industries of this size, change has to be gradual. Switching from beef to chicken is easy for consumers. On the contrary, in order to fulfill demand, restaurants like McDonalds have to completely re-tool their supply-chain. Farms need to change their facilities to accommodate more chickens, processing plants need to change all their machinery, and restaurants need to change how they cook and prepare the final product.

I personally believe that this will benefit both the profit-minded producer, along with the health-conscious consumer. The fast food world is changing, and these companies know that innovation is essential to adapt to the changing taste buds of consumers.

What is your eating preference at these fast food chains? Do you think this rise in commodity prices is a good thing? Have you become more health-conscious?

http://www.nbcnews.com/business/wheres-beef-mcdonalds-dropping-angus-burgers-us-menu-1C9864163

Spirit Airlines: We Know You Hate It, But We Don’t Care

Spirit Airlines is an American airline company that is known for having low-cost flights. The company is more concerned about the prices they give out rather than the complaints they are receiving. Spirit has been acquring their fair share of criticism from customers and the media. A survey was made of some 16,000 customer ratings and Spirit Airlines was among the bottom of the list for flying in America. “That report did not ask the one big question of who offers the best prices. And hands down, the No. 1 thing we’re told by our customers is that the price matters,” says Spirit spokeswoman Misty Pinson. Let’s be honest, would you complain about a flight that is two and a half hours long and only cost 75 bucks?

Spirit AirlinesThe company strives to make the price for flights as low as possible. They have an average base price of only 79 dollars. One thing that customers hate about Spirit Airlines is the fact that they charge fees before and during the flights to passengers. These fees can add up to be 40 to 50 dollars for the majority of customers. Spirit Airlines does not even offer a free cup of water or have a video system while the passengers are in flight. There is not much leg room either so you are cramped, regardless of how short you are.

The airline company believes that is what the Spirit customers want when it comes to this airline business. Spirit believes they have travelers who would most likely be getting a bus seat if their airline service was not available. The Chief Executive Officer Ben Baldanza says, “Well, what we say is that we care about what our customers care about, which is price, and one of the things that Consumer Reports survey didn’t ask is where do you get the lowest fare? And so they asked about leg room, and they asked about check-in, and they asked about bag fees, and things like that. But the total price that customers pay on Spirit Airlines is less than they pay on anyone else, and that’s why they love us.”

Spirit Airline company should not be upset by all the criticism coming their way. Spirit is a very solid business as their sales rose 23 percent in just the past quarter. The planes are fuller than the rest of the other airline companies. The company has a rate of 85.1 percent in the first quarter  of 2013 when it comes to flights being full. That makes the company really profitable as they move forward.

The airline company still gets a lot of negative feedback from the press even when they are succeeding. So, is it fair that Spirit Airlines is getting this terrible assessment from the media when they are making profits and almost all of their flights are full? Does the base price really trump all the niceties that other airlines offer?Or should management try to improve their baggage fees and legroom in the flights in order to please the customers more?

Links:

http://www.businessweek.com/articles/2013-05-23/spirit-airlines-doesnt-care-if-you-hate-it

http://money.cnn.com/2012/05/03/news/companies/spirit-airlines-fees/index.htm

http://aviationblog.dallasnews.com/2013/05/spirit-airlines-ceo-we-have-the-lowest-prices-and-thats-what-customers-care-about.html/