Today, in the framework of the marketing ideas coexist big-technology and cost-effective branding. In the first case, the owner of a very strong brand name – name that can provide large-scale budgets for promotion, creates innovation, and promotes it with powerful attacks through advertising, PR, trade marketing and special events, creating a huge wave of interest in the goods. In this case, the owner of the brand risk that those investments in promotional programs do not yield the expected dividends. For more modest budgets, there is a second way to move goods to market. In this case, innovation finds its way into the hearts of consumers slowly and gradually, but with minimal cash investment. Usually promotion starts with using the web-site, as well as forums and chats on the Internet. First, the product is fixed in the specialized market niches, whose number is gradually increasing. The main risk of this model is that a product or service may be morally outdated before it created for them the critical mass of buyers. Nevertheless, many business leaders (for example Dell) was able to cope with such a risk.
Further, I would like to analyze an important issue – why is this new kind of marketing almost completely replaced by frequency of use an old one? According to foreign experts, the marketing paradigm shift was the result of combined effect of several market trends. Factor one: The rate of appearance of innovation exceeds the ability of marketers to predict consumer behavior. In the 80’s ”“ 90’s of last century, innovation is literally filled the market. The new dynamics of market activity is strongly contrasted with the pace of product development in the traditional consumer categories such as food, cosmetics or personal hygiene products (these commodity groups are determined by the situation on foreign markets in previous years). The classical approach, in which at every new idea to conduct market research, then develop products that once again tested the market, after which the program and be translated to market, was too slow for the new reality.
The second factor was the shift in consumption patterns. In the 60’s ”“ 80’s of the XX century in developed countries there was a boom in product packaging. In fact, these years were a time of flourishing companies such as Procter & Gamble, Pillsbury, General Mills and so on. The desire to meet the desires of consumers has led to the emergence of various new products with improved properties, which to this day is a classic technology to maintain interest in the brand. However, analysis of the distribution of advertising expenditures in various product categories shows that the “products in the package”ť conceded its leadership as more active advertisers – to manufacturers of consumer electronics and software, as well as companies working in entertainment, travel, telecommunications and investment.
The third factor is the fact that the technology market research restricts innovation capabilities of modern business. The research results do provide an opportunity to improve existing products. However, it is difficult to expect from the ordinary consumers of technical knowledge, which predicts the development of high-tech or creative qualities that enable prompt Hollywood director to guess successful stories for movies. Moreover, this post-hoc studies are the resource that allows to protect the company from unnecessary costs on the promotion of obviously failed project, as stated in Do you know your business?
The fourth factor is the change branding technology. If we look back to the 60’s ”“ 80’s of the last century, at the time of flourishing market of mass consumption products, we will see that the brand and the product had the same name and were practically synonymous. Today’s product and brand should be totally separated from each other. Not only marketers, but consumers know that the product ”“ is a set of useful properties, as a brand ”“ is feelings and associations that attract consumers to the product. However, this fact absolutely does not prevent the giant growth of popular brands. As a result, some brands have become a much weightier than the individual products they represent. It can be said that today we live in a world of mega-brands with excess resources. Microsoft, Apple, Toshiba and many others – are brands of high-tech market. Giorgio Armani, Gianni Versace, L’Oreal ”“ are a well-established brands in the fashion world. Of course, there are brands in the movie industry: Tom Cruise, Arnold Schwarzenegger, Sharon Stone. All these names have one thing – their ability to induce a positive association is many times the needs of the product that spawned them. This means that they are quite able to share their popuarity with unique products and services that are excreted into the market with “marketing ideas”ť, by facilitating their movement through their own behalf.
The next factor has become a phenomenon of the parity of product categories, in which none of the competitors can keep the advantage on their side for a long time. Perhaps the most striking example in this case may be, the same Intel. When this company develops new, more powerful and faster chip, it offers it by the highest price on the market. However, today, any innovation can be easily copied by other companies, and owners of these clones, avoiding all the technical and legal barriers begin to develop their analogues of the product. As a result, the price for Intel product falls until it reaches the approximate parity with competitors. Thus, progress in the field of high technologies is becoming an absolute necessity for companies such as Intel, as a way to again and again to improve their profitability.