A number of famous brands have built their reputation not only by providing strong products but also by recognizing the importance of being socially responsible.  As we discuss in the What is Marketing? tutorial, being socially responsible means a company shows concern for the markets in which it operates, including caring for people in these markets as well as the physical environment in which it conducts business.  Well-known companies that are widely recognized for their socially responsible behavior include Ben & Jerry’s, Newman’s Own and Whole Foods.

One way companies exhibit socially responsible behavior is by providing support for social causes.  In fact, it can be argued that Ben & Jerry’s, Newman’s Own and Whole Foods are as well-known for the social causes they support as they are for the reputation of the products they market.  So from a brand management perspective, the value of these brands may not be built solely through traditional marketing decisions (product, price, promotion, distribution) but also by the socially responsible decisions they make.

This story from Fast Company looks at another company that has adopted social responsibility as a key strategy for helping build value in its brand.  The company, Kind Healthy Snacks, markets healthy snack products and its sales have grown nicely since it was founded 10 years ago.  While in the story the company president emphasizes product taste as the key reason customers purchase their products, a significant percentage of customers also cite the company’s active role in various social campaigns has the reason they buy Kind’s products.

Aside from the importance of social involvement in shaping Kind’s image, the story also discusses other marketing decisions that distinguish this company from competitors, including the company’s decision to eschew fancy product names and the use of relatively simple packaging.

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As we mention in the What is Marketing? tutorial, in most industries, keeping ahead of the competition requires organizations be creative in their marketing efforts.  Marketers that simply rely on what has worked in the past, without developing new products, become targets for aggressive competitors who are willing to try new ideas.  

Yet there are times when marketers may be too creative and introduce products that are just too far ahead of their time and, consequently, fall flat once introduced.  There are many reasons for this including: 1) the product is such an innovative concept that customers just do not understand it (e.g., cannot see its real value); 2) the product works well and offers many advantages, but it is hampered by poor business execution (e.g., wrong promotional message); 3) the product faces unavoidable roadblocks that impede its growth (e.g., insufficient infrastructure); or 4) the product is so high priced that few in the target market can actually afford it.

If you are ever looking for a good example of a business idea that was ahead of its time and failed for one or more of these reasons, then take a look at this story from National Public Radio.  This story brings back an early 1980s news report discussing Viewtron, what is likely one of the earliest companies to offer online shopping in the U.S.  Now we are not talking online as we know it today.  This is online in the pre-Internet days carried out over the old videotex service, where a person’s television was hooked up to a set top box that then connected directly to the service’s computer using telephone lines.

When listening to what it took to make a purchase using this service, it is not hard to imagine why customers at the time were not too wild about the idea.  The product selection was limited, the cost just to use the service was significant ($600 for a box and a monthly subscription fee), and many people did not quite understand how it all worked.  In retrospect, the combination of these shortcomings makes it easy to see why this failed.

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In our Retailing tutorial, we present a number of ways in which retailers can be categorized.  One way of grouping is by the method a retailer uses to distribute to customers.  As we explain, there are two main distribution approaches – store-based retailing, where customers visit a specific physical location to make purchases, and non-store retailing, where customers make purchases without visiting a retailer’s outlet.  Under the non-store retailing category we list three types: 1) selling online (i.e., Internet retailing); 2) selling by direct marketing methods (e.g., catalog); and 3) selling that occurs through vending machines not found at the retailer’s own location.

Given this story in USA Today, we probably should add another non-store retailing option – selling from a truck.  The idea of truck selling is certainly not a new one as food trucks are a common fixture in many large urban areas.   Yet retail selling, where a truck moves from one location to another, is much less common and, in some cities, is not even legal due to decades-old vendor laws.  

Despite potential legal constraints, retailing from a truck is apparently a hot business.  In fact, there is even a special trade association for this type of retailing, the aptly named American Mobile Retail Association.  This organization claims this retailing method is growing rapidly.  And as this story discusses, much of this growth is coming from boutique clothing retailers, who travel to different locations then invite customers to enter their small trucks where they can browse products and make purchases.  These retailers are able to attract customers thanks to social media, where they communicate the locations their trucks will set up shop.

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We have often discussed how competitors view Walmart as the big beast of retailing.  Considering Walmart’s sales are greater than the combined sales for the next four largest U.S. retailers, it is understandable competitors face immense challenges and, consequently, direct a good deal of their attention to figuring out how to battle the market leader.

Yet Walmart is not the king of all retailing.  They are only the dominate player in store-based retailing.  When it comes to non-store based retailing, and specifically selling on the Internet, the beast tag shifts to Amazon.  Similar to what it takes to compete against Walmart, the task of selling against Amazon is also quite difficult.  It is especially challenging when a competitor tries to take on Amazon directly.  Because Amazon seems to offer so many advantages, including wide product selection, low pricing and fast delivery, for most retailers a head-to-head battle is probably not a wise idea.  So what can a competitor do to combat Amazon?  One answer is to find others looking to do the same.

As Internet Retailer lays out in this story, competitors are discovering one option for fighting Amazon is to join with other retailers as part of an online marketplace, which are often found within a larger retailer’s site.  While this idea is not new, - Amazon has been offering their own marketplace option for small specialty retailers for years - several large retailers have launched marketplaces and recruited other retailers to join.  At the top of this list is none other than Walmart, which may be king of store-based retailing but ranks well below Amazon when it comes to online retail sales.  Yet as the story discusses, Walmart is not alone in this strategy as Staples, Best-Buy, and Sears have also developed online marketplaces.

The key reason for offering a marketplace, where other retailers sell their wares, is that it expands product options available to customers.  In doing so, the marketplace owner hopes customers stay on the website which in turn may help the host retailer sell more of its own products.  It also allows retailers to capture a lot of customer information that they ordinarily would not obtain when shoppers leave the website to shop at other sites.  Finally, retailers hosting marketplaces also take a percentage of the action.

Overall, this is an excellent article that not only discusses the strategic value of online marketplaces but also contains a number of fascinating statistics.

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After a delightful sunny and warm 2-week holiday, we have returned to the blogosphere with a news item that may be unsettling to many who still enjoy print publications.

Since the Internet rose to become a dominant communication platform, print publications, such as newspapers and magazines, have experienced a tremendous plunge in subscribers.  This has resulted in numerous publications, and especially trade magazines, closing their doors.  To give an example, in the early 2000s when KnowThis.com first listed marketing publications in our Weblinks Collection section, it included nearly 60 print publications that had a marketing emphasis.  Today only about 30 remain on our list.  Gone are such publications as Chief Marketing Officer, Promo Magazine, Industry Standard (Internet business focus), Purchasing, and Tradeshow Week, to name a few.  As the titles suggest, most of these were highly targeted publications that appealed to a relatively narrow group of marketers.  These also were publications whose revenue model relied heavily on businesses advertising in their publications.  While as the Internet grew and the information in many of these magazines became readily available through other online sources, the real death knell came when advertisers fled to the Internet, which offered stronger targeting options and also provided powerful methods of tracking those who were interested in an advertisement.

The impact of the Internet on print media is clearly demonstrating how an industry can be disrupted by innovation.  Many years ago, the automobile did the same to many industries, such as horse saddle and whip manufacturers, while television put a serious dent into companies providing products to the radio industry.

Now, according to this story, another marketing magazine is suffering.  In this case, it is the well-respected Advertising Age magazine, which has been publishing weekly since 1930.  AdAge has announced it is moving its print cycle from once a week to once every two weeks.  While the magazine is not dead, this is certainly not a good sign that the print version will be around much longer.  In fact, it is becoming more and more likely that a printed version of almost any publication is likely not going to be an option in the very near future.  In essence, this product category has entered the decline stage of the product life cycle.

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