One of the core concepts in Ries and Trout’s classic “Positioning” is the concept of the line extension trap. Brands must communicate a simple message to consumers that sticks despite our society’s communication overload. A line extension such as Starbucks Liquor can “blur the sharp focus of the brand in the mind”. It is easy … Read more The Line Extension Trap
The level of customer service in America sucks. How often does the individual you interact with at most establishments, look you in the eye, smile, and talk to you in a friendly tone of voice. Maybe I’m too young to remember the days before Nordstrom, generous return policies, and frequent flyer miles. Perhaps my generation … Read more How Important is Customer Service?
There are basically two strategic paths a business can travel down. Option one: take the low cost path, cutting costs as much as possible and then pass those savings to the customer in the form of lower prices. Option two: try to differentiate your product in such a way that consumers are willing to pay … Read more Low cost Strategy vs Differentiation Strategy
Harvard Professor Michael Porter’s Five Forces is a great way to systematically consider the attractiveness of entering a given industry, in case you were not sure whether you should start that basement brewery you’ve been planning. Previously economists focused on consumer surplus, but Porter flipped this around to determine the attractiveness of an industry based … Read more The 5 Forces Theory