Church of the Customer Blog

I am writing in regard to the blog titled “Fun is Contagious” by Ben McConnell. It was written on April 7th, 2009. The blog talks about Alamo Drafthouse here in Austin, Texas and highlights some of the “fun” events they have been hosting and creating for eager Austinites. The first one is Renegade Karaoke where they rented a bus to drive around Austin. They filled it with customers who sang karaoke in odd settings. For example, they sang in a Starbucks, a police station, a fitness class, and a busy intersection. The hilarious footage was then compiled into a four minute tape that is played before other movie showings. I suggest you take a look at the video. It is priceless.


The second fun event they reference is the secret world premier tour of the new Star Trek movie. The movie goers thought they were buying tickets to see and catch up on their 1982 Star Trek movie, with a special opportunity to see ten minutes of the new Star Trek. As a surprise, Khan, from the first Star Trek movie, comes out ten minutes into the showing and suggests that they play the new Star Trek movie. To the viewers surprise they got to watch the entire new film before anyone else! I am sure these guests were beyond thrilled.

At the end of the blog Ben writes: Fun is contagious. Fun spreads. Fun inspires loyalty. Fun opens wallets. I couldn’t agree more. I think an important distinction here is that fun inspires loyalty and opens wallets for adults, as well as children. The mass buying power of children is utilized by parents because they want their children to have fun and create experiences that will sculpt their childhood. This is why Miley Cyrus has a million people at her concerts. It is FUN for the children. Well Alamo Drafthouse is finding ways to make adults feel like children again by creating silly and unique experiences. I know that the Justin Timberlake sing along was a huge hit production at the Alamo Drafthouse because it brought our generation back to the “teeny bopper” days. I personally, and I can’t believe I am going to admit this, had an entire wall in my room filled with pictures of JUST Justin. I am talking about a wall that stretched probably ten to twelve feet and was equally high. The Justin Timberlake sing-a-long could not have taken me back to my childhood roots any better.


In my opinion, service companies such as Alamo Drafthouse, are most successful when they throw a little bit of structure out of the window and bring in more spontaneity. It creates good PR, great word of mouth advertising for them, and makes the customer feel good about their experience making them want to come back for more surprises. I have been sitting here trying to think of another company that has the same business model as Alamo Drafthouse, but am having a hard time. Places such as the Magic Time Machine restaurant come to mind because there is constant entertainment with waiters, bubbly and colorful drinks for children, and when someone goes to the bathroom they yell “Potty Patrol, Potty Patrol.” And look at that, I remember that experience as a child. I haven’t been to The Magic Time Machine in probably 15 years and I can still recall the fun that I had. If a company does its best to create an experience that is fun above all else, I can guarantee that their customers will recall their experiences the way I have about The Magic Time Machine.

Paper Outine

1. Introduction:
   
   Thesis: The topic for my paper is going to be the consumer electronic industry and its use of marketing to understand consumer behavior, underlying buying decisions, why people upgrade, switch brands and want the “top” new products even when a better one is going to come out in just a few months. I want to examine the entire industry, but want to focus mainly on Apple products for innovation and customer loyalty.
   
   My reservations are that I picked a subject that is too broad and opinion based. I am unsure that I will be able to find real data that proves my point about consumer behavior in this market. I think there will be lots of speculations. Also, I am not sure I am hitting the correct points in my paper. Am I talking about the correct issues related to this topic? Any input you may have about this would be great! Thanks!
   
   Consumer Electronic Industry/technology in general- facts, trends, trends in current recession
   Overall marketing usage of celebrities, promotions, etc to get attention
   World dependence on Technology- why we need it? Or think we do.
   Apple’s ability to generate buzz through apps, marketing, affiliations to brand
   Its competition with Google for market share
   Survey about iPhone and Apple loyalty versus other phone providers insights
   
   Body:
   1.)
   General: I plan to outline the technology, gadget and cell phone industries. I want to lay a foundation for the paper.
   I. More than 75% of U.S. households have at least one PC
   II. According to a wide-ranging United Nations report, around six in ten people across the globe now use mobile phones.
   III. According to the CTIA-Wireless Association, over 250 million Americans now subscribe to a cellular-phone service. That places the penetration rate at 82.4 percent.
   
   Technology purchases are effected by our current economical state: Recession
   I. American consumers are now watching their bank account balances and reassessing their gadget habits because of the recession
   II. People are seeking help to either repair their gear or add to its functionality and what the product does for them
   1. “Function is the new Fad”
   2. The repair industry is booming!
   III. Still, the chances are that “whether you're male or female, 18 or 81, you'll buy a technology product this year”
   1. People are more inclined to scrimp elsewhere than they are to go without a new cell phone.
   2. Department of Commerce states that the proportion of dollars spent on electronics versus other "durable goods," such as cars, has never been higher
   IV. While people are still buying electronics, they're paying much less for them due to online research
   1. There is increased traffic to sites that offer discounts and freebies
   
   Smartphones are sophisticated mobile phones that offer users access to the Web and e-mail, as well as, provide phone calling and all kinds of other messaging options.
   I. This category of device is the hottest thing going in the mobile market and is seen as the biggest growth engine for mobile devices over the next few years
   II. Consumer functionality is hot- Apple is better in this category than Microsoft
   III. “If Microsoft or any other competitors want to hasten Apple's rise in this market, they'll have to leap-frog Apple with something truly revolutionary”
   IV. Handsets sporting the iPhone OS (i.e., first- and-second generation iPhones) currently make up a whopping 50 percent of US mobile Web traffic. That number is up an impressive 40 percent from August of last year.
   V. BlackBerry's share dropped to 21 percent, down from 32 percent; Windows Mobile went from 30 to 13 percent; and Palm dipped from 19 to 7 percent. Despite being available on only one phone in the US, Google's Android managed to capture 5 percent of the traffic.
   VI. Globally, Symbian is still on top at 43 percent, with the iPhone 33 percent. The drop-off is fairly steep from there, with RIM at 10, Windows Mobile at 7 and Palm at 3 percent.
   
   2.)
   a. Technology Marketing

In this section I want to mention many different types of marketing that these companies invest in.

I. Use of celebrities:
a. Alicia Keys- Samsung Camcorder
b. Lauren Conrad- Blackberry
c. David Beckham- RAZR2
d. Maria Sharapova-Canon Powershot
e. Jay-Z-“personal for HP”
f. Justin Long- “Get a Mac” Ads
g. These are just a few examples

II. Use of competition:
a. Mac vs. PC
i. I’m a Mac, I’m a PC
ii. The “real PC’s”: Life without walls
b. Call phones ads/partnerships:
i. Blackberry touch vs. iPhone
ii. AT&T as the only iPhone supplier
iii. Blackberry Storm only sold at Verizon Wireless

Here I plan to talk about how these promotions, ads, partnerships, and celebrities effect customer buying decisions and thoughts about a product.

3.)
a. World Dependence on Technology: In this section I want to touch on how our dependence on these products forces us to continually be "in the know" about the newest, most interesting product on the market becuase technology is such a huge part of our everyday life. I have found some pretty crazy information about our dependence and I think that our desire to have the coolest products is most definatley tied to this dependence.

I. Grown Man Cries after not having his blackberry video from NBC Today series: Could you do without?
a. 1 in 8 Americans addicted to the internet
b. “It is like a four year old that had a teddy bear with them everywhere then you yanked it away from him”
i. Physical symptoms- anxiety, tightness of chest
ii. Like cigarette smoker who quit, asked cab driver for cell phones
iii. “It's like an addiction. Heck, I'm ready to suggest an addition to the DARE program. If it keeps up this way, we'll soon be checking e-mail through our navigation systems while driving and talking on the car's standard-equipped cell phone all at once. The scary part is, by then we might not even stop to ask ourselves: Is this for real?”

4.)
I. Apple’s ability to generate buzz through apps, marketing, affiliations to brand; also its competition with Google. This part of the paper is where I am going to start focusing more on the Apple brand vs. its competition. I am also going to try to explain why customers feel the unique way they do about Apple.

a.) Apple’s iPhone and Google’s Android compete in the cell phone market
· Both have social media and game applications
· Apple is one step ahead because of their vertical and exclusive way of doing business which makes the iPhone highly desirable and its accompanying App Store highly accessible.
· Google's philosophy is provide the best and most extensive service you possibly can and people will love it and then monetize it
· Google Voice application is available on the iPhone
o Google is utilizing the iPhone as a way to generate knowledge in the marketplace about its product while they develop Android to become an even stronger competitor to iPhone
o Apple should watch out for this!

Video: http://www.youtube.com/watch?v=9IlvfEBJGx4&feature=player_embedded
· Apple’s catchy and almost cocky marketing campaign is crucial towards their brand image
· Apple has a unique ability to foresee needs in the marketplace through great research and development and marketing research of customers
· Apple has generated and built a CULTURE around themselves and the product. It has become a “lifestyle”
· Reasons Apple has loyal customer base:
o Secret 1: Engineering supports design -- no exceptions
-Apple's brilliant designers figure out in detail how the product will look, feel and work, and then the engineers are tasked to make it happen.
o Secret 2: Fewer is better
-It tries to develop the fewest possible number of products, each with the broadest possible appeal. Yes, there are multiple iPods, but feature overlap is close to zero, and it's super easy to learn which product does what.
o Secret 3: The experience is the product
-Apple is dead serious about this secret, even to the point of offering US$35,000 to the city of Montreal to remove three parking meters in front of the Apple store there. The city refused, but this is how seriously Apple takes the Apple "experience."
- Another example is Apple's packaging. The company's products come in beautifully designed packaging with obviously expensive packaging materials and manuals.
o Secret 4: The product is the product
- Apple CEO Steve Jobs talks about the actual products above all.
o Secret 5: You can't please everyone, so please people with good taste
- Only the high end creates the pixie-dust intangible quality of buzz, brand affinity and, ultimately, brand loyalty, which can be converted into higher margins and higher sales.
o Secret 6: Leave the past behind
o Secret 7: Product names are important. Really important
- One of Apple's few competitors in the cell phone handset market is the LG KU990 Viewty. What sounds better: The "iPhone" or the "KU990 Viewty."
o Secret 8: Group affiliation is the driver
- Apple fans are the most rabidly active, fiercely loyal group in the industry. Why do Apple fans spend so much time and energy fighting for the honor and glory of a consumer electronics company?

- The answer is that identity is a primary human motivation. One of the major components of self-identity is group affiliation. People want to belong to a group that immediately identifies them as being superior to other people in other groups. That's just how human beings are wired. It's the same aspect of human nature that drives all fandom as well as nationalism and religious zealotry.
- It's less about functionality and more about what it tells other people about who you are and what group you belong to.
- This is what's so great about Apple: Its products get a "B" on features and functionality -- they're almost best in class in most of their respective categories. But they're an "A+" on what really matters -- coolness, which translates into both boosted self-identity and appealing group affiliation.

5.)
I. My Survey will be conducted between now and when my paper is finished. I want to get insights about how the typical college student views Apple, the iPhones, and other non Apple products. I want to compare this data in someway that I am not sure about yet.

***I have sources for all of my current information but I did not feel the need to include them in this outline!***

Marketing Research

I am happy that this week I have the freedom to write about WHATEVER I want! How fun! I must say that it is almost harder writing a blog when there is less guidance on the topic because it forces me to think about what interests me. In a way, it’s quite ironic that I mention this because this is a class about customer insights and it is very common for consumers to be uncertain about choosing products, especially peripheral purchase decisions. Consumers are often unsure why they pick the product that they do, can’t say what caused them to choose that product, and can’t pinpoint the attribute about the product that attracted them towards it in the first place. This is the underlying problem with marketing research, surveys, and interviews because even if consumers are providing information about a topic, the researcher is never 100% sure that the information they are analyzing is even accurate and representative of their target market and product. This was very apparent to me in our class discussion on Monday about our project update. Three groups in our class presented to the other students in the class about their current research progress. Most of them were unsure whether their data was skewed or biased, almost all of them coming to the conclusion that there were definite biases and holes within their research.
Then I started thinking about how marketing research from online blogs can be beneficial for marketers because the comments from users are natural, genuine, and unmonitored. This is a positive attribute because a response bias and reporting bias do not exist. The user is voluntarily giving a comment because they feel a sense of importance and relevance to the product while they also are not tailoring their answers to look favorable in front of a researcher. A negative side of this marketing research is that most of the time this research is going to be monotonous. The marketer is going to have to sift through hundreds and hundreds of comments in order to get at least 50 serious and helpful remarks. On the same coin, although some of the negative responses will be goofy and negative for negatives sake, some of the negative comments will help the manufacturer and marketing team edit and form the product to continue to please the consumer.
One example of this is a blog that I found about the “Snuggie.” Incase you haven’t heard of the he Snuggie™, it is a blanket that keeps you totally warm and gives you the freedom to use your hands. The positive aspects are that it allows the customer to work the remote, use your laptop or do some reading in total warmth and comfort! Basically it is a robe put on backwards, but with a blanket attached. There is a new competitor to the Snuggie called Peekaru Original Fleece Baby Carrier Cover made by Mom 4 Life. I found a blog about it and here are some comments that I discovered. Also, here is the blog link: http://nymag.com/daily/intel/
· I am glad my children are older because otherwise I would totally buy this
· I agree it looks absurd, but these are awesome! Every other mom I met on the street would ask me where to get one. It is simply a fleece that you can wear over a baby bjorn or other carrier in cold weather. Otherwise, the mom can't zip up her coat. Plus you don't have to bundle up your baby in winter snow suit before slipping him into the carrier. As for the person who says parents can't be bothered to carry their children in their arms anymore, when is the last time you lugged around a baby?? Try a baby plus a shopping bag = perpetual back ache.
· Looks like heaven for your lower back…
· Caption: Woman throws fashion out the window after becoming a mother
Point being, a little helpless blog can give insights to Mom 4 Life as they continue to market their brand and product to the very judgmental, but somewhat accepting world of consumers.