Fighting Creative Destruction

What do you do if your product is obsolete and demand is shifting rapidly leftward?  The paper industry has a problem: digitization and environmental concerns.  To prevent further declines, the brand of paper our department uses has created a clever slogan (see the picture) -- "Because it's easier to learn on paper."  I wonder what other examples there are of businesses using the market to maintain the demand for a product that is being displaced by technological change (as opposed to obtaining government protection, the usual route in these instances)?

The Marketing of Dogfish

In New England, cod and haddock are overfished and, according to WBUR, fishermen and restaurant owners are seeking cheaper and more plentiful fish like dogfish. Fish wholesalers are therefore working to promote the dogfish's image. According to WBUR, dogfish is already used in cafeterias at some local universities and hospitals -- and local lawmakers are now pushing the federal government to help by buying dogfish for prisons and military rations. What genius marketing: "Dogfish: Tasty enough for schools, hospitals, C rations, and even prisons."

If Your Parents Drove a Ford, Do You?

Most adults have vivid memories of the cars of their childhoods -- the wood-paneled station wagons (with backwards-facing rear seats, no less) or the boxy minivans in which they were driven to school or church.  But how much do those memories affect people's car-buying decisions in adulthood?  That's the question asked in a new paper (draft PDF; abstract) by Soren T. Anderson, Ryan Kellogg, Ashley Langer, and James M. Sallee:

We document a strong correlation in the brand of automobile chosen by parents and their adult children, using data from the Panel Study of Income Dynamics. This correlation could represent transmission of brand preferences across generations, or it could result from correlation in family characteristics that determine brand choice. We present a variety of empirical specifications that lend support to the former interpretation and to a mechanism that relies at least in part on state dependence. We then discuss implications of intergenerational brand preference transmission for automakers’ product-line strategies and for the strategic pricing of vehicles to different age groups.

Martin Lindstrom Answers Your Questions on Brandwashed

Last week we solicited your questions for Martin Lindstrom, a marketing consultant and author of the new book Brandwashed: Tricks Companies Use to Manipulate Our Minds and Persuade Us to Buy.

Now, Lindstrom, returns with his answers to a few of them. As always thanks for every one who participated.

 

Q One more question occurred to me: Marketing is intended to persuade us to buy products, but it also serves another latent function which is to educate us about new products, about differences between products, or about the products themselves. Given this educational benefit, among other benefits, do you think marketing is a net good or a net bad for society on the whole? - NZ

Bring Your Questions for Brandwashed Author Martin Lindstrom

Though the exact percentage is debatable, the fact is that the vast majority of U.S. GDP is made up of personal consumption. The American consumer doesn't just drive the U.S. economy, for decades he's been driving the global one as well. Though that dynamic is slowly changing as Americans cut back on just about everything we buy, for the better part of the last 60 years, the U.S. consumer has been king. And from this has sprung a massive marketing and advertising industry coldly focused on a singular goal: getting us to buy as much stuff as they possibly can.

In his new book Brandwashed: Tricks Companies Use to Manipulate Our Minds and Persuade Us to Buy, marketing guru Martin Lindstrom trains a bright light on his own industry to uncover all the unsavory things that marketers do to subtly, or not so subtly, influence our buying habits. Lindstrom's agreed to answer your questions, so fire away in the comments section. As always, we'll post his replies in due course.

What if They'd Just Called it the iPhone 5?

Unless you're living under a rock, you're probably aware that Apple unveiled a new iPhone yesterday. At what turned out to be a relatively muted Apple product launch, it was new CEO Tim Cook's first chance at replacing Steve Jobs as product pitchman. It seems he did just fine.

The new iPhone is loaded with cool new features that the market was anticipating, with one exception: it's not called the iPhone 5, it's called the iPhone 4S.

By the time it became obvious that Cook wasn't going to introduce anything called an iPhone 5, (about 1:50 pm EST yesterday), the stock price began to plummet pretty quickly, as you can see in the chart below. From 12:15 pm to 3:15 pm, the price dropped more than 6%. Also, note the spike in volume at the bottom.

A Subway Ride to the Past — Compliments of Nucky Thompson

This past weekend, I was waiting for the subway when an old, 1920s-era train pulled to a stop on the express line. My first thought was that it was one of those worker trains you sometimes see (especially on weekends) that ferry MTA crews along the line as they make repairs. But passengers were getting on. Guys in MTA gear hauled open the manually sliding doors and did an old-fashioned call-out: Downtown express train. Next stop 72nd Street. Getting on seemed the obvious thing to do. It helped that neither I nor my wife had seen the news that HBO paid the MTA $150,000 to run a 1920s-era vintage subway train up and down the express line, as a way to promote the second season of Boardwalk Empire.

So the effect was as they'd intended: stupefaction, followed by slow realization, followed by total bemused wonderment. It felt like being at an amusement park. I was amazed at how fast it went, how comfortable the seats were (compared to the current plastic ones), and how loud it was with the windows down. Here's a video:

RadioShack: Would You Like a Gun With Your Satellite TV?

A marketing first? A Montana RadioShack is offering customers who sign up for a Dish Network package a coupon for a either a pistol or a shotgun from a local sporting goods store.

How Disney Does It

My son visited the Walt Disney World complex in Florida and pointed out the methods used to spread demand temporally. Coupons for 30 percent discounts on restaurant food purchased before noon or between 3PM and 4:30PM are available. Merchandise coupons for 20 percent discounts are given for use between 9AM and noon. Both coupons are offered to shift demand rightward at non-peak times.

Ham Certificates; Taxidermy & Cheese

You responded with vigor when we asked for your favorite weird promotional pairings. Our favorites are the edible/inedible pairings.