The More You Know: Economics & Marketing

During an offseason for any company, revenues can decrease dramatically.  Yes, the recession is somewhat to blame for the bottom line being low but there’s a lot more that has to do with it too.

How many people in Wisconsin can say they plan on buying a pool for their backyard in January?  How many people want a Christmas tree in the middle of summer?  The answer: very few.  Therefore these businesses must be well informed of the industry they are getting themselves into.  A Halloween store must know that almost no one is going to buy a costume any other month besides October when they decide to get into the costume selling business.

What happens very often in the off season is what we call a temporary shutdown.  In economics you learn that sometimes it is better for a certain amount of time to just incur the fixed costs, such as rent, and stop production all together (and stop all variable costs).  Instead of remaining open and paying the heating, water, and electricity costs, some businesses will close for a fixed amount of time to avoid losing more money than if they were to stay open and not sell anything. 

An example of this is a store that I came across in Bay View Wisconsin.  Babes ice cream shop had a sign on the door saying “Frozen for the Season. Reopening February 23.”  Some walking by may think that this meant Babes was going out of business, however the principals of economics tells us that this instead was just the smart thing to do.  The ice cream shop owners know that the winter months are not a popular time for cold treats, and therefore closed their store until the demand for their product increases. 

Learning to make sound business choices and understanding decisions that other businesses make is a key part in marketing.  Since supply and demand create the market, we must learn to take advantage of all they have to offer.  And so, we learn that economics is the basis for everything in the advertising and marketing industries.

She's Back!

Most of us are familiar with the infamous Crazy Target Lady. She only comes out at this time of the year, during the two month span of November and December. She's the lady who does warm ups pushing shopping carts in stilettos and a red jumpsuit. She's the one who makes her own glitter and is spotting crying hysterically reading the newspaper sale ads. She's the face of the Target-after Thanksgiving Sale and if you don't know who this is, you are clearly missing out.

The woman behind the glitz is Maria Bamford, a comedian and actress from Minnesota.  Target first introduced this over the top character during the holiday season of 2009, and the campaign seems to be a pretty big hit.  This is the first year where stores have begun to open up as early as 10 pm at night (Wal-Mart) instead of the usual 4 or 5am. The Crazy Target Lady has been a successful way to showcase the excitement of post-Thanksgiving holiday shopping and get even more customers involved in the now late night shopping. 

As for me, seeing the yearly holiday commercials has become some sort of a staple in the shopping season.  Although most shoppers are not as excited as she, the Crazy Target Lady does embrace the spirit of the Christmas season.  It is not all about the material things… well maybe just a little bit.

The Power of a Catchy Jingle

While lying on the couch the other night, a familiar song rung through the house. It wasn't one that would be on the Billboard Top 100 list; rather it was from a commercial that I had seen many times before. The song aired during a commercial on AM radio for Lowe's, the home improvement store. Before the narrator even spoke, I knew what it was for and immediately envisioned the commercial of a happy lady dancing around her apartment, sequentially showing her throughout her life.

The power of a simple song brought me to thinking about the company and enabled me to relate to a radio advertisement without words. Bravo, Lowe's!

Anything-But-Traditional Advertising

Traditional advertising has gone as far as billboards, television, radio, and most recently, the internet. The new race however, is to think outside of the box. More and more companies are marketing their product through unusual campaigns that are anything but conventional.

The most recent that I had noticed was in my menu at The Cheesecake Factory. When given the menu, I noticed how big and heavy it was... My first response, "They have a TON of food here!" proved to be not completely accurate. 

The Cheesecake Factory has become part of a growing number of businesses renting out space for advertising.  Their menu, held together by a thick spiral, contained three different advertisements throughout its pages of pastas, entrées, soups, and desserts.  The ads varied in their message, but remained on the same placement throughout the menus. Guests would theoretically come in, sit down, and be inclined to buy a certain product from an outside source while deciding on their food order. 

Whether or not this tactic has been profiable, I am unsure.  I do know however, that our table found the strange placement of ads somewhat comical.  We all had been out running around (like most other guests who had come from the mall) and just wanted something to eat; Not perfume. 

I found the advertisements to be a waste of time for the companies who purchased the space and thought they concurrently helped The Cheesecake Factory lose a bit of its class.