I. Introduction
a. Thesis: Walmart has replaced GM as the template for American businesses because they understand their customers' insights. (I'm still working on this, I want to talk about the era of customer insights and how necessary it is to listen to your customers in order to be successful)
i. mention the factors that contribute to the shift of power from companies like gm to companies like walmart--this will probably be a comparison between GM and Walmart. how did GM lose its title as the template of American business? failure to listen to their customer's wants and needs and adapt this into their business model--contrast this with Walmarts ever evolving customer ventric business model
II. body
a. brief history of Walmart: follow Walmart from Sam Walton's days to now. Customers have always been number one. Emphasize the various ways they make this evident in their company culture and physical retail stores
i. different marketing eras that Walmart and GM live in. GM was sales driven and Walmart is customer driven
b. Walmart's values: a comparison between walmarts values to GMs. again, mention the importance of keeping the consumer #1
c. How does Walmart listen to their consumers: low cost, high efficiency, new sustainable products, adaptation
i.low cost: Walmart squeezes every penny from suppliers and passes the savings on to the consumers
ii.high efficiency: your purchases are electronically sent to their hub within 15 minutes of the purchase, they know what you want and they keep thier stores stocked to ensure that you get what you want, they started off with their own distribution system--another way to almost guarentee customers' needs will be met quickly (focus on the fad products)
iii.new sustainable products: walmart is realizing the importance of offering sustainable products and the power it holds. this is crucial for two reasons: 1. their customers new needs are being satisfied and 2. their image is improving because they are helping the environment--compare this to GM: failed to innovate, lost favorable opinion in the public eye and lost customers
iv. Walmart is still growing during the recession because it has adapted. it has seized the opportunity to scoop up the customers that are downgrading their purchases. Walmart must impress them or else these new customers will not continue to shop at Walmart after the recession.
d. how does Walmart communicate to their customers
i.commercials: new campaign's focus is completely on the customer saving money and walmart's green movement/the power it yeilds
ii.in store promotions: not as effective as their commercials, but the inside is not pretentious, highlights your savings, constant rollbacks and comparisions to other stores so that the customer feels good about their purchasing decisions
iii.comparison to GM--when it was the template of american businesses, its ads were not as targeted to their customers insights and needs--it basically told the customers what they should have so it could make more money**will elaborate in my paper, still need more research to formulate this thought
e. walmart is listening to its customers needs at the expense of their employees--
backlash against walmart is targeted towards the treatment of their employees (healthcare, lawsuits for gender discrimination)
however, while they may be subtly changing these practices (its more behind the scenes, so harder to see), they don't necessarily have to because its customers are not demanding a change. most people upset at walmart would never shop there, walmart does not have to listen to them. this won't completely change until its core customers demand a change.
--GM was the complete opposite, in its era they focused more on the employees than the customers
III. Conclusion
a. Walmart is very good at forecasting customer demands/listening to customer insights. This characteristic is the reason why they have replaced GM.
b. Walmart cannot, however, expect that sheer growth will keep them in this position. must adapt and continue to predict customers' needs if they want to remain the template of American business.
c. Lessons from GM: GM became consumed with its powerful position and that was its downfall, Walmart must learn from this mistake.
Monday, April 13, 2009
Wednesday, April 1, 2009
Blog Seven
According to “How Do They Know Their Customers So Well”, there are seven reasons to understand your customers better, all of which focus on generating more revenue. As a business in the private sector, your motive is to increase profits. But, when companies are this obvious about why they are getting to know me, I become hesitant. Let me illustrate with an anecdote...Yesterday I went shopping for the first time this semester, and it was quite the customer experience. With summer weather and open-toed lattice flats on my mind, I ditched my 1:00 class for the mall. Needless to say, I was nowhere near presentable in my smelly gym clothes. But could you blame me? I had a time limit and shoes on my mind. The sales associates, on the other hand, were not impressed. In all of the high-end clothes stores I visited, I never even received the time of day...and this is a recession! You'd think these people would be hammering to make a sale. Even when I bought something, they could care less about me. Apparently people who are not dressed are not customers.
On the opposite end of the spectrum were the shoe stores. They would not leave us alone. I would inquire about one pair of shoes, and they would bring me nine extra pairs. Usually these shoes were quite tasteless, but as a former retail associate, I understand the need to cross-sell. Although it was annoying to try on eight ugly shoes just to humor the sales associate, I understood what they were trying to do. It was a blatant attempt to increase the amount of money I spent. What really bothered me, however, was the interaction during the actual transaction. Name, I understand. Area code, questionable, but not too invasive. My email address, on the other hand, is not something I like to freely give out. And to them, telling them your email address is no longer an option. They don’t ask if you would be willing to give an email address so that you can receive updates, they list it right after area code in an attempt to trick you! Name? Area code? Email address? When I refused to give them one, they looked at me like I was crazy for refusing their offer. To marketers, email addresses can lead to a goldmine of information, especially if customers can personalize their subscription. It can increase cross-selling success, enhance customer loyalty and create more effective marketing messages. On the customer’s end, it can ease a purchasing decision by offering discounts on certain items or suggesting complimentary items. These are two things that I personally struggle with when shopping. Associates operating the cash register don’t usually stress the benefits of these email lists though. Giving your email address is like as expected as paying for your new shoes. You wouldn’t steal, so why should you refuse to give us your email address? I find this attitude bothersome. Anytime information is being gathered, customers need to give their consent. Sales associates can increase the amount of customers willing to give personal information if they can articulate the benefits of doing so. I know that there are ‘unsubscribe links’ at the bottom of every email, but being asked my email address at the store is annoying. I’m tired of denying them something they expect and I’m sick of receiving useless spam mail. I like the approach Nordstrom’s and Harley use to gain additional insights from their current customers. Personal shopping is, obviously, personal. If I owned a Harley, I would love to go on a ride with the CEO’s, I’d chat them up the whole trip. These methods are more creative and less lazy. Nordstrom’s and Harley Davidson respect their customers and it pays off. I know that less prestigious companies don’t have the funds to follow their examples, but doing a half-ass job obtaining personal information only hurts them. I want to avoid the stores that ask for my email address, not give them more insight.
On the opposite end of the spectrum were the shoe stores. They would not leave us alone. I would inquire about one pair of shoes, and they would bring me nine extra pairs. Usually these shoes were quite tasteless, but as a former retail associate, I understand the need to cross-sell. Although it was annoying to try on eight ugly shoes just to humor the sales associate, I understood what they were trying to do. It was a blatant attempt to increase the amount of money I spent. What really bothered me, however, was the interaction during the actual transaction. Name, I understand. Area code, questionable, but not too invasive. My email address, on the other hand, is not something I like to freely give out. And to them, telling them your email address is no longer an option. They don’t ask if you would be willing to give an email address so that you can receive updates, they list it right after area code in an attempt to trick you! Name? Area code? Email address? When I refused to give them one, they looked at me like I was crazy for refusing their offer. To marketers, email addresses can lead to a goldmine of information, especially if customers can personalize their subscription. It can increase cross-selling success, enhance customer loyalty and create more effective marketing messages. On the customer’s end, it can ease a purchasing decision by offering discounts on certain items or suggesting complimentary items. These are two things that I personally struggle with when shopping. Associates operating the cash register don’t usually stress the benefits of these email lists though. Giving your email address is like as expected as paying for your new shoes. You wouldn’t steal, so why should you refuse to give us your email address? I find this attitude bothersome. Anytime information is being gathered, customers need to give their consent. Sales associates can increase the amount of customers willing to give personal information if they can articulate the benefits of doing so. I know that there are ‘unsubscribe links’ at the bottom of every email, but being asked my email address at the store is annoying. I’m tired of denying them something they expect and I’m sick of receiving useless spam mail. I like the approach Nordstrom’s and Harley use to gain additional insights from their current customers. Personal shopping is, obviously, personal. If I owned a Harley, I would love to go on a ride with the CEO’s, I’d chat them up the whole trip. These methods are more creative and less lazy. Nordstrom’s and Harley Davidson respect their customers and it pays off. I know that less prestigious companies don’t have the funds to follow their examples, but doing a half-ass job obtaining personal information only hurts them. I want to avoid the stores that ask for my email address, not give them more insight.
Tuesday, March 24, 2009
The Persuaders
Dr. Rapaille’s technique is a three stage psychic journey. First, he accesses his focus group’s cortex, or past reasoning. During the “luxury” experimentation, Dr. Rapaille asked participants to shout out words that they associated with luxury. After this first session, his focus group feels pretty confident and proud of themselves for their comprehensible contributions. This is just part of Dr. Rapaille’s plan to make the participants comfortable in order to take them into the next phase of his technique: the emotional journey. During the second phase Rapaille asks the focus group to describe ‘luxury’ to him like he is a five year old from another planet. This stage allows Rapaille to translate the emotional aspects associated with luxury. When this phase is over, most of his participants are thoroughly confused. They have no idea what Dr. Rapaille was looking for or how they fared. This is just what the doctor wants. He is trying to discover the unconscious feelings toward luxury. He finds these underlying wants in the last, primal stage. In this step, Dr. Rapaille removes the chairs from the room, turns out the lights and asks his focus group to scribble their thoughts down while they lay on the floor. He is trying to reach them while they are in a dreamlike mindset. He believes this is the key to unlocking, and selling, luxury.
Dr. Rapaille believes that all products are associated with our reptilian code and the reptilian hot button always wins. The reptilian code is linked to the first time we have ever experienced anything. It is our first instincts after we are born. In The Persuaders, Rapaille uses the Hummer to convey the advantages of using the reptilian code as market research. Logically, you would not need to drive a Hummer in order to go shopping because you are, presumably, driving on a concrete road. People are not rationally purchasing Hummers, so we should not rationally market them to people using traditional, cortex-driven marketing. Another example that Rapaille cites is the code for the SUV. Through his focus groups, Rapaille discovered that the code for SUV was domination. If SUV manufacturers can portray this idea with bigger, badder cars, they will be able to sell more SUV’s.
After I finished The Persuaders, I was very curious about Song airlines’ fate. I assumed that the venture was unsuccessful because I had never seen them at an airport or on travel websites. Song’s wiki article confirmed my suspicions; it also mentioned that Song was a victim of “corporate culture taken too far”. I completely agree. I thought the idea behind the airlines was great. Who doesn’t like more legroom, personalized TV’s on every seat, and low-cost tickets? But it also sounded too good to be true. With my experience in air travel there is always a catch. If you want a cheap flight, you can’t have plush amenities (like Southwest). I think this was Delta’s first mistake; it was not a viable business decision to offer everything plus the kitchen sink for a low cost, especially in their state of fiscal woe. Second, they were trying way to hard. You cannot replace the word ‘cool’ with ‘song’ and expect it to catch. It sounds lame, particularly when a bunch of middle age women are saying it. Most cool things start with counter culture and work their way into the mainstream. Song was attempting to push cool onto the mainstream without any credibility and they failed. Also, it doesn’t help that Delta, one of the worst airlines, was its parent company…
Dr. Rapaille believes that all products are associated with our reptilian code and the reptilian hot button always wins. The reptilian code is linked to the first time we have ever experienced anything. It is our first instincts after we are born. In The Persuaders, Rapaille uses the Hummer to convey the advantages of using the reptilian code as market research. Logically, you would not need to drive a Hummer in order to go shopping because you are, presumably, driving on a concrete road. People are not rationally purchasing Hummers, so we should not rationally market them to people using traditional, cortex-driven marketing. Another example that Rapaille cites is the code for the SUV. Through his focus groups, Rapaille discovered that the code for SUV was domination. If SUV manufacturers can portray this idea with bigger, badder cars, they will be able to sell more SUV’s.
After I finished The Persuaders, I was very curious about Song airlines’ fate. I assumed that the venture was unsuccessful because I had never seen them at an airport or on travel websites. Song’s wiki article confirmed my suspicions; it also mentioned that Song was a victim of “corporate culture taken too far”. I completely agree. I thought the idea behind the airlines was great. Who doesn’t like more legroom, personalized TV’s on every seat, and low-cost tickets? But it also sounded too good to be true. With my experience in air travel there is always a catch. If you want a cheap flight, you can’t have plush amenities (like Southwest). I think this was Delta’s first mistake; it was not a viable business decision to offer everything plus the kitchen sink for a low cost, especially in their state of fiscal woe. Second, they were trying way to hard. You cannot replace the word ‘cool’ with ‘song’ and expect it to catch. It sounds lame, particularly when a bunch of middle age women are saying it. Most cool things start with counter culture and work their way into the mainstream. Song was attempting to push cool onto the mainstream without any credibility and they failed. Also, it doesn’t help that Delta, one of the worst airlines, was its parent company…
Friday, March 6, 2009
Kenna's Dilemma
Lesson 1: quantity v. quality
Marketers should focus on gaining expert qualitative opinions to test products instead of relying on huge quantities of data. An example of this is the New Coke fiasco. Coke based its decision to change the formula on millions of taste test results. As Gladwell mentions, these little snippets of information can be very misleading. If Coke had received input from expert taste testers such as Gail Vance Civille and Judy Heylmun, this mistake would not have happened. Kenna's dilemma also exemplifies this idea. Music experts and people who had an opportunity to watch Kenna in concert appreciated his music more than the online raters. When conducting research, marketers can get a little number happy and focus too much on quantitative results. They should weigh qualitative, expert opinions at least equally with their quantitative data. Theoretically, researching both quantitatively and qualitatively should eliminate further Coke disasters and ensure that truly talented individuals have successful careers. This lesson can be applied to our group project and research papers as well. When marketing backyard products to pre-teen boys, our group should use quantitative data for our initial research. Percentages and numbers can offer guidance for our project. Qualitative data, on the other hand, should lead to the final product. In my experience with talking to my 11-year-old brother, I have found that it is difficult to elicit any information from him. I can't even get the boy to tell me what he did at recess. Not only do boys his age have trouble talking to the opposite gender, but they are also uncomfortable around older people in general. Therefore, the quantitative information that we find in secondary sources may not provide honest insights from boys his age. Furthermore, tactics such as interviewing hundreds of kids his age, would not be beneficial to our research either. They would most likely just tell us what we want to hear so that we will stop bothering them. That is why we should use expert opinions from teachers or child psychologists to formulate insights about the 10-13 year old boy segment. Performing observations and coming up with judgments based on their interactions with friends will also help our group design an ideal backyard for our target market. In gathering insights for my paper, I will add qualitative methods to my research. Actually watching customers shop at Wal-Mart can indicate their preferences and tendencies for purchasing sustainable products. This additional research will be useful in determining the extent to which Wal-Mart listens to their customers.
Lesson 2: Gut feelings can be a better indicator of consumer preferences than the reasons behind these snap judgments.
The other lesson that captured my attention in this chapter was the idea that gut instincts are more aligned with expert opinions. The jam experiment was particularly interesting. I was surprised to find that more students identified the highest quality jam when there was no reasoning behind their decisions. I believe this is true because giving a reason often makes you second-guess your initial (and usually correct) answer. Ever since my very first multiple-choice test, my teacher’s helpful advice was to stick with your first answer. The jam experiment epitomizes this notion in a marketing context. Marketers should strive to satisfy this gut instinct feeling. As I’ve written in a previous post, most of my purchasing decisions are a result of my snap judgments. Very seldom do I contemplate and analyze my grocery decisions. Oftentimes the first tub of detergent or brand of granola that sticks out in the store is the item that I purchase. Marketers can make their products more intriguing, and thus, more purchasable through appealing package design. The first sense that we use to experience products is sight. If something is visually stimulating, than we are more likely to favor that product over a competing brand. In “Kenna’s Dilemma”, Gladwell used ice cream packaging to emphasize this point. More people are more attracted to the tub container than the square one. There may be scientific reasons for this preference, but marketers are more interested in consumers’ purchasing patterns than the reasons why in this case.
Marketers should focus on gaining expert qualitative opinions to test products instead of relying on huge quantities of data. An example of this is the New Coke fiasco. Coke based its decision to change the formula on millions of taste test results. As Gladwell mentions, these little snippets of information can be very misleading. If Coke had received input from expert taste testers such as Gail Vance Civille and Judy Heylmun, this mistake would not have happened. Kenna's dilemma also exemplifies this idea. Music experts and people who had an opportunity to watch Kenna in concert appreciated his music more than the online raters. When conducting research, marketers can get a little number happy and focus too much on quantitative results. They should weigh qualitative, expert opinions at least equally with their quantitative data. Theoretically, researching both quantitatively and qualitatively should eliminate further Coke disasters and ensure that truly talented individuals have successful careers. This lesson can be applied to our group project and research papers as well. When marketing backyard products to pre-teen boys, our group should use quantitative data for our initial research. Percentages and numbers can offer guidance for our project. Qualitative data, on the other hand, should lead to the final product. In my experience with talking to my 11-year-old brother, I have found that it is difficult to elicit any information from him. I can't even get the boy to tell me what he did at recess. Not only do boys his age have trouble talking to the opposite gender, but they are also uncomfortable around older people in general. Therefore, the quantitative information that we find in secondary sources may not provide honest insights from boys his age. Furthermore, tactics such as interviewing hundreds of kids his age, would not be beneficial to our research either. They would most likely just tell us what we want to hear so that we will stop bothering them. That is why we should use expert opinions from teachers or child psychologists to formulate insights about the 10-13 year old boy segment. Performing observations and coming up with judgments based on their interactions with friends will also help our group design an ideal backyard for our target market. In gathering insights for my paper, I will add qualitative methods to my research. Actually watching customers shop at Wal-Mart can indicate their preferences and tendencies for purchasing sustainable products. This additional research will be useful in determining the extent to which Wal-Mart listens to their customers.
Lesson 2: Gut feelings can be a better indicator of consumer preferences than the reasons behind these snap judgments.
The other lesson that captured my attention in this chapter was the idea that gut instincts are more aligned with expert opinions. The jam experiment was particularly interesting. I was surprised to find that more students identified the highest quality jam when there was no reasoning behind their decisions. I believe this is true because giving a reason often makes you second-guess your initial (and usually correct) answer. Ever since my very first multiple-choice test, my teacher’s helpful advice was to stick with your first answer. The jam experiment epitomizes this notion in a marketing context. Marketers should strive to satisfy this gut instinct feeling. As I’ve written in a previous post, most of my purchasing decisions are a result of my snap judgments. Very seldom do I contemplate and analyze my grocery decisions. Oftentimes the first tub of detergent or brand of granola that sticks out in the store is the item that I purchase. Marketers can make their products more intriguing, and thus, more purchasable through appealing package design. The first sense that we use to experience products is sight. If something is visually stimulating, than we are more likely to favor that product over a competing brand. In “Kenna’s Dilemma”, Gladwell used ice cream packaging to emphasize this point. More people are more attracted to the tub container than the square one. There may be scientific reasons for this preference, but marketers are more interested in consumers’ purchasing patterns than the reasons why in this case.
Tuesday, February 24, 2009
Paper Topic
I want to write about Wal-Mart. Are they an example of how to listen to customers, or are they merely pulling the wool over our eyes? I think it is commendable how much they keep the customer in mind. They take low profit margins so they can pass the savings onto their customers. Every penny is squeezed from their suppliers, and they're not keeping the savings. We are. I also think that their green initiatives/ sustainability movement was partly customer driven, partly business move. It's interesting that they are one of the only companies doing well right now, but I can't say I'm surprised either. It's only logical that an economy like this would force consumers to be more price conscious and essentially downgrade to Wal-Mart. More people are spending less and saving more. Many commercials, including Wal-Mart's, have emphasized this shift. While I am proud of Wal-Mart for harnessing their wide reach and massive size in order to promote sustainability, I'm also a little skeptical. Now, I'm not necessarily skeptical about their commitment to sustainability- I don't believe their latest initiatives are simply a ploy. I believe that Wal-Mart is making an honest effort to make our world better, cleaner, greener. And, if Wal-Mart can do this without raising prices and simultaneously increasing their bottom line, all the more reason to go green. Most companies take losses when they convert to a sustainable strategy, which make the move look less attractive. But Wal-Mart is proving that you can help the world and make money. What I am skeptical about are the other issues they have failed to address, mainly employee treatment. Are they paying employees less, offering fewer benefits, not allowing unions, and inhibiting female job growth because consumers are not demanding that employees receive equal pay, more benefits, unions, and equal opportunities? Is Wal-Mart listening to only feasible, mutually beneficial costumer insights, such as sustainability? At the same time, I understand that you can't make everyone happy. Solving these issues will not make Wal-Mart the most liked company. They will always have enemies. I just want to know when, if ever, does Wal-Mart stop listening to what their customers want? What segment does Wal-Mart seek to make happy? Maybe they don't care about the group of people that are interested in human rights. Maybe they think that low price trumps everything, and their customers are unwilling to bear the cost to resolve these issues. In a nutshell, I'd like to learn how much or how often Wal-Mart listens to their customers.
In a previous blog, I mentioned that I am pro Wal-Mart. When I'm not grocery shopping for the experience, I want to get the most for my money. The fact that Wal-Mart is attempting to be more sustainable reinforces my decision to shop there. I'm rather proud of Wal-Mart for shouldering the responsibility of bettering our environment. They're not perfect, but they have set an example for other giant companies to follow: going green is profitable. I have also studied Wal-Mart in four other classes, so it's a recurring theme in my college career. I think a lot of people, whether they admit it or not, are intrigued by Wal-Mart. In my history class last semester, my teacher argued that Wal Mart has replaced GM as the template for American companies. I hope that theory holds true for their sustainability initiatives as well. Furthermore, corporate social responsibility is a topic that has recently captured my attention, mostly because it optimistically believes that a soulless corporate company can have a soul. I'd like to believe companies can remain profitable while creating a greener future.
As I see it right now, I believe that Wal-Mart has been an effective listener of consumer insights. Customers are the reason Wal-Mart finagles every penny from suppliers and can price their goods below anyone else. I'm also interested in Wal-Mart's communication efforts. They are very transparent about saving money and less communicative about their sustainability practices. I have a feeling the latter is driven by the economic downturn and the fact that their most loyal customers will not choose Wal-Mart on the basis that it is more sustainable. In the article Economic Blues Leave No Room for Green, which I found in Advertising Age, author Jack Neff reinforces my hunch. According to him, "when Wal-Mart launched a new campaign targeting opinion leaders around the political conventions last month, the message was about how the company is stimulating the economy by saving people money, with none of the sustainability themes that have been common in such ads in years past." Neff's article focuses on the messages that Wal-Mart chooses to display to their consumer and the rest of the public. Another article I found in Women's Wear Weekly analysed Wal-Mart's segmentation strategy. This was also interesting because it accurately points out that the segment the millennium generation cares most deeply about environmental concerns. Therefore, if Wal-Mart wants to develop relationships with these customers, they must effectively communicate their sustainability initiatives. Additionally, Wal-Mart cannot continue to ignore their growing human rights/ labor problems. They will eventually have to acquire new costs in order to resolve these issues and appease their younger, future customers. On the other hand, Wal-Mart must also retain their current, more price conscious consumers. Here lies the conundrum, who does Wal-Mart listen to?
In a previous blog, I mentioned that I am pro Wal-Mart. When I'm not grocery shopping for the experience, I want to get the most for my money. The fact that Wal-Mart is attempting to be more sustainable reinforces my decision to shop there. I'm rather proud of Wal-Mart for shouldering the responsibility of bettering our environment. They're not perfect, but they have set an example for other giant companies to follow: going green is profitable. I have also studied Wal-Mart in four other classes, so it's a recurring theme in my college career. I think a lot of people, whether they admit it or not, are intrigued by Wal-Mart. In my history class last semester, my teacher argued that Wal Mart has replaced GM as the template for American companies. I hope that theory holds true for their sustainability initiatives as well. Furthermore, corporate social responsibility is a topic that has recently captured my attention, mostly because it optimistically believes that a soulless corporate company can have a soul. I'd like to believe companies can remain profitable while creating a greener future.
As I see it right now, I believe that Wal-Mart has been an effective listener of consumer insights. Customers are the reason Wal-Mart finagles every penny from suppliers and can price their goods below anyone else. I'm also interested in Wal-Mart's communication efforts. They are very transparent about saving money and less communicative about their sustainability practices. I have a feeling the latter is driven by the economic downturn and the fact that their most loyal customers will not choose Wal-Mart on the basis that it is more sustainable. In the article Economic Blues Leave No Room for Green, which I found in Advertising Age, author Jack Neff reinforces my hunch. According to him, "when Wal-Mart launched a new campaign targeting opinion leaders around the political conventions last month, the message was about how the company is stimulating the economy by saving people money, with none of the sustainability themes that have been common in such ads in years past." Neff's article focuses on the messages that Wal-Mart chooses to display to their consumer and the rest of the public. Another article I found in Women's Wear Weekly analysed Wal-Mart's segmentation strategy. This was also interesting because it accurately points out that the segment the millennium generation cares most deeply about environmental concerns. Therefore, if Wal-Mart wants to develop relationships with these customers, they must effectively communicate their sustainability initiatives. Additionally, Wal-Mart cannot continue to ignore their growing human rights/ labor problems. They will eventually have to acquire new costs in order to resolve these issues and appease their younger, future customers. On the other hand, Wal-Mart must also retain their current, more price conscious consumers. Here lies the conundrum, who does Wal-Mart listen to?
Sunday, February 15, 2009
My Grocery Shopping Experiences
As I was rooting around e reserves to find a blog topic, I came across the Whole Foods/ Central Market articles. Since Whole Foods and Central Market are not low-cost grocery stores, I expected the authors to claim that both stores yield the same customer experience. Once I read the first sentence I knew I had guessed wrong. First, I noticed the difference in the authors’ tones. Normally when I'm reading for a class, I'm not concerned with tone; I'm more interested in the content within the article. But these authors used tone to illustrate the points of differentiation between Whole Foods and Central Market. In the Whole Foods article, the author begins with a story of a free-range chicken to demonstrate how extreme Whole Foods can be. On the other hand, “Fast Company” gets straight to the point. The author admits that Central Market is overwhelming and then praises them for being a “super supermarket”. The titles also indicate a difference in experience. “Food Porn” once again calls attention to Whole Foods’ extreme stance on food. “Super Market” is merely a pun that pays tribute to Central Market.
Everyone can tell the difference between shopping in a low-price grocery store and a high-quality grocery store. When I am at HEB or Wal-Mart, I just want out. At those stores, grocery shopping is the least enjoyable experience in the world. I want to get the most groceries for my money and leave as soon as possible. Nothing puts me in a worse mood than grocery shopping on a budget.
It’s the nuances between the grocery stores in each category that often go unnoticed. When you’re comparing HEB and Wal-Mart there are other experience factors to consider besides price. Since Wal-Mart is more spread out and has twice as many lanes as HEB, it’s generally less crowded. At HEB, you can barely push your cart down an aisle without running into two or three people. Even if I’m at fault and run head on into another cart, I blame it on them. HEB is an angry place. Situations like this just aggravate the already frustrating grocery shopping experience. That is why I would rather shop at Wal-Mart than HEB when I choose a low-cost grocery store. To me, the benefits of shopping at HEB (higher quality produce) do not match the additional cost ($5 or $10 extra dollars). By shopping at Wal-Mart, I sacrifice quality produce, for no produce. I can get out of Wal-Mart faster and spend less than $35 for a week's worth of groceries. I might not get the nutrition I need, but that's what vitamins are for. I value my time more than my health. Furthermore, I expect Wal-Mart to match my hate for grocery shopping. Wal-Mart is not a happy place and I never expect to enjoy grocery shopping there. At HEB, there’s still an expectation for an enjoyable trip since you’re paying more.
When it comes to high quality grocery stores, the nuances are a little more difficult to pick out. In fact, there are many people who don’t even notice a difference between Whole Foods and Central Market. Personally, I’ve always thought that shopping at Central Market is more enjoyable than shopping at Whole Foods. When I go to Central Market, I don’t want to leave immediately. I want to go up and down every aisle multiple times. When someone bumps into me, I apologize- even when it’s clearly his or her fault. At Central Market, I like to buy new items and try new things. Sometimes, I even decide to purchase ingredients to make a meal, which is unheard of. Ultimately, I feel comfortable at Central Market and more willing to spend money. At Whole Foods, I’m intimidated. Unlike Central Market, Whole Foods does not sell anything normal, like Cheerios. Everything at Whole Foods is organic. If I don’t have a list, I feel lost when I shop at Whole Foods, especially since most of their products are foreign to me. Finally, and most importantly, I often feel disappointed when I shop at Whole Foods. I feel like many of their items sacrifice taste for an organic certification. Take peanut butter and jelly for example. They are roughly the same price at both grocery stores, but the quality of Central Market brand PB&J far exceeds that of Whole Foods. If I’m going to spend money, I’m going to spend it at Central Market.
Everyone can tell the difference between shopping in a low-price grocery store and a high-quality grocery store. When I am at HEB or Wal-Mart, I just want out. At those stores, grocery shopping is the least enjoyable experience in the world. I want to get the most groceries for my money and leave as soon as possible. Nothing puts me in a worse mood than grocery shopping on a budget.
It’s the nuances between the grocery stores in each category that often go unnoticed. When you’re comparing HEB and Wal-Mart there are other experience factors to consider besides price. Since Wal-Mart is more spread out and has twice as many lanes as HEB, it’s generally less crowded. At HEB, you can barely push your cart down an aisle without running into two or three people. Even if I’m at fault and run head on into another cart, I blame it on them. HEB is an angry place. Situations like this just aggravate the already frustrating grocery shopping experience. That is why I would rather shop at Wal-Mart than HEB when I choose a low-cost grocery store. To me, the benefits of shopping at HEB (higher quality produce) do not match the additional cost ($5 or $10 extra dollars). By shopping at Wal-Mart, I sacrifice quality produce, for no produce. I can get out of Wal-Mart faster and spend less than $35 for a week's worth of groceries. I might not get the nutrition I need, but that's what vitamins are for. I value my time more than my health. Furthermore, I expect Wal-Mart to match my hate for grocery shopping. Wal-Mart is not a happy place and I never expect to enjoy grocery shopping there. At HEB, there’s still an expectation for an enjoyable trip since you’re paying more.
When it comes to high quality grocery stores, the nuances are a little more difficult to pick out. In fact, there are many people who don’t even notice a difference between Whole Foods and Central Market. Personally, I’ve always thought that shopping at Central Market is more enjoyable than shopping at Whole Foods. When I go to Central Market, I don’t want to leave immediately. I want to go up and down every aisle multiple times. When someone bumps into me, I apologize- even when it’s clearly his or her fault. At Central Market, I like to buy new items and try new things. Sometimes, I even decide to purchase ingredients to make a meal, which is unheard of. Ultimately, I feel comfortable at Central Market and more willing to spend money. At Whole Foods, I’m intimidated. Unlike Central Market, Whole Foods does not sell anything normal, like Cheerios. Everything at Whole Foods is organic. If I don’t have a list, I feel lost when I shop at Whole Foods, especially since most of their products are foreign to me. Finally, and most importantly, I often feel disappointed when I shop at Whole Foods. I feel like many of their items sacrifice taste for an organic certification. Take peanut butter and jelly for example. They are roughly the same price at both grocery stores, but the quality of Central Market brand PB&J far exceeds that of Whole Foods. If I’m going to spend money, I’m going to spend it at Central Market.
Tuesday, February 3, 2009
The Paradox of Choice
I really enjoyed listening to Barry's podcast and I agree with his paradox of choice. There are definitely advantages to having options. Everyone wants something different. Companies/ brands can't expect their consumers to only like one thing. No one wants to be forced to buy something just because it's the only thing available. People want to stand out, and having choices allows you to do just that. At the same time, however, we are now forced to pick one thing out of hundreds or thousands of options. A quite daunting task, to say the least. The goal of marketing is to satisfy your customer, but I don't even remember the last time I was satisfied after choosing one item out of millions. My most rewarding decisions are at places where I only have three or four choices. Making decisions is empowering, when you make the right one.
As consumers, we have the responsibility to make informed decisions. So, theoretically, buying stuff should make you smarter if the intent is to educate yourself before or during a purchase. This is not the case for me. I can honestly say that being faced with millions of choices makes me dumber. Let me explain. When I look at a grocery isle or a menu and try to pick something out, I don't think rationally or logically. I stare blankly and go with my gut instinct. I can't give you a reason as to why I picked what I picked. Granted, I stress over what I pick out, so it may seem as if I'm using my brain and analyzing my future purchases. Like Barry mentioned, I get paralysis, but I also stop thinking. My mind goes completely numb and refuses to function. You may think this isn't a big deal, but when you're faced with decision upon decision day after day, these brain lapses add up. The more I choose an item without logic, the more I feel like this action is a good strategy and can be warranted for other non-purchasing decision. Not choosing an item for a purpose or logical reason begins to make sense to me. It's easy. I begin believing that it's a good idea not to think about the why and just act.
Here's an example of what I mean, just in case I don't make sense (because I rarely do). My father asked me to read about a new war memorial and give him my opinion. The war memorial in question was recently dedicated to a group of men who were forced to participate in World War II. Instead of fighting, these men essentially became cowards. They deserted their country during a German invasion. My father was outraged that the men were allowed to receive a war memorial in their honor. I disagreed. When I was asked why, I couldn't answer. I felt like these men should still be remembered, but I didn't know why! I just felt like they should. That was not a good enough reason for my father. He had been listening to my poorly constructed arguments for a while, and realized that I felt too much and thought too little. After I finished reading Atlas Shrugged over the break, Aynn Rand confirmed his realization. Now, I'm not blaming the glut of consumer choices for my lack of reasoning skills. I'm merely stating that having choices made me rationalize the "gut instinct" answer.
Almost every time I go shopping or dine out, I have an anxiety attack deciding what I want to buy or eat. Example: grocery shopping last night. My sister and I stared at the wall of granola bars for about three minutes before we decided upon the same Special K bars we always get. Even after we chose Special K bars, we were faced with another decision. What flavor? We picked the single pack of blueberry instead of the vanilla, chocolate, blueberry tri pack. This morning, I'm craving a vanilla Special K bar. Example: shopping at Urban Outfitters last week. I walked into a store full of opportunities. Half an hour later, I walked out with nothing because I was too stressed out to try anything on. Two hours later, I regretted not buying those jeans. Example: eating lunch at Blue Dahlia today. I could have breakfast or lunch. I want pancakes. They don't offer pancakes. Now I'm back at square one. I settle on a shrimp sandwich. As the waitress walks away, I wish I had ordered the Belgian waffles instead. Example: any beer garden I walk into. I don't know what to get, at all, ever. I order what my friend orders. I hate it because it's not as good as my other friend's drink. I regret almost every choice I make. As a consumer, I want to be happy with my purchase, not wondering what the Belgian waffles tasted like or jealous of a different flavored beer.
I only feel truly happy about my decisions when I go to a place with very little choice. Example: Five Guys Burgers and Fries. They have about four things on their menu. I feel bloated when I leave, but boy, am I satisfied.
I understand that companies are not bombarding consumers with choices to make them feel unhappy. I do not think they have ill intentions. This is merely another paradox of choice. Companies want to enable their customers by providing thousands of choices, but consumers inevitably end up dissapointed.
As consumers, we have the responsibility to make informed decisions. So, theoretically, buying stuff should make you smarter if the intent is to educate yourself before or during a purchase. This is not the case for me. I can honestly say that being faced with millions of choices makes me dumber. Let me explain. When I look at a grocery isle or a menu and try to pick something out, I don't think rationally or logically. I stare blankly and go with my gut instinct. I can't give you a reason as to why I picked what I picked. Granted, I stress over what I pick out, so it may seem as if I'm using my brain and analyzing my future purchases. Like Barry mentioned, I get paralysis, but I also stop thinking. My mind goes completely numb and refuses to function. You may think this isn't a big deal, but when you're faced with decision upon decision day after day, these brain lapses add up. The more I choose an item without logic, the more I feel like this action is a good strategy and can be warranted for other non-purchasing decision. Not choosing an item for a purpose or logical reason begins to make sense to me. It's easy. I begin believing that it's a good idea not to think about the why and just act.
Here's an example of what I mean, just in case I don't make sense (because I rarely do). My father asked me to read about a new war memorial and give him my opinion. The war memorial in question was recently dedicated to a group of men who were forced to participate in World War II. Instead of fighting, these men essentially became cowards. They deserted their country during a German invasion. My father was outraged that the men were allowed to receive a war memorial in their honor. I disagreed. When I was asked why, I couldn't answer. I felt like these men should still be remembered, but I didn't know why! I just felt like they should. That was not a good enough reason for my father. He had been listening to my poorly constructed arguments for a while, and realized that I felt too much and thought too little. After I finished reading Atlas Shrugged over the break, Aynn Rand confirmed his realization. Now, I'm not blaming the glut of consumer choices for my lack of reasoning skills. I'm merely stating that having choices made me rationalize the "gut instinct" answer.
Almost every time I go shopping or dine out, I have an anxiety attack deciding what I want to buy or eat. Example: grocery shopping last night. My sister and I stared at the wall of granola bars for about three minutes before we decided upon the same Special K bars we always get. Even after we chose Special K bars, we were faced with another decision. What flavor? We picked the single pack of blueberry instead of the vanilla, chocolate, blueberry tri pack. This morning, I'm craving a vanilla Special K bar. Example: shopping at Urban Outfitters last week. I walked into a store full of opportunities. Half an hour later, I walked out with nothing because I was too stressed out to try anything on. Two hours later, I regretted not buying those jeans. Example: eating lunch at Blue Dahlia today. I could have breakfast or lunch. I want pancakes. They don't offer pancakes. Now I'm back at square one. I settle on a shrimp sandwich. As the waitress walks away, I wish I had ordered the Belgian waffles instead. Example: any beer garden I walk into. I don't know what to get, at all, ever. I order what my friend orders. I hate it because it's not as good as my other friend's drink. I regret almost every choice I make. As a consumer, I want to be happy with my purchase, not wondering what the Belgian waffles tasted like or jealous of a different flavored beer.
I only feel truly happy about my decisions when I go to a place with very little choice. Example: Five Guys Burgers and Fries. They have about four things on their menu. I feel bloated when I leave, but boy, am I satisfied.
I understand that companies are not bombarding consumers with choices to make them feel unhappy. I do not think they have ill intentions. This is merely another paradox of choice. Companies want to enable their customers by providing thousands of choices, but consumers inevitably end up dissapointed.
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