jonatanp

[jonatanp]

Harnessing the media and film industry to create impact and perceptual change

The world is full of many outdated and unnecessary stereotypes and perceptions. Some were created in a gradual process over the course of many years, and some are strengthened during this period. I believe that each of us has the ability to bring about positive change, and everyone needs to act - in advocacy and action - to advance our society to a more equal and inclusive place. But there is one body that has greater responsibility and a stronger ability to bring about change - the media and film industry. There are two ways to create perceptual change: 1. Direct approach - such as the ads we saw in the case. 2. Cognitive approach - the ability to learn through the senses and the subconscious (such as children’s comic books in the case, where the demon is always brown). The direct approach can generate impact especially when it comes from people with a very positive reputation in the society or people who are role models - this influence is mainly rational. In contrast, the cognitive approach is responsible for a deeper perceptual change. This change creates a position or perception, not necessarily because we believe it is the accepted and correct position, but because we truly believe in it through our inner selves. It also helps raise self-confidence and self-belief in people who are affected by stereotypes. Therefore, cognitive advocacy is the key to a strong and genuine change. The most important bodies are the media and the film industry, they have a great impact on cognitive approach and therefore they need to be harnessed to these struggles. It is not only the ability to create change and a positive impact but sometimes the need to stop stereotypes that these bodies continue to deepen in our perception. It's not always simple, either because of political, financial, and cultural involvement - but it's important that we continue to push there to create real impact and change.

[jonatanp]

Innovation is for dreamers, not for business people

I have an innovative idea! I'm pretty sure this product gives value and will attract customers. But how confident am I of it? How much will we sell? What will customers think? How do we test it? How to make a forecast? What is the risk? Will I lose all investment?

Being original and innovative is very exciting, and also has a lot of benefits - but is it the right thing to do from a business point of view? Later entrants could compete effectively, improve by learning from mistakes and successes, and be creative based on knowledge. Many studies show that early movers are less profitable than later entrants.

Benefits of later entrants:

1. Costs - The cost of imitation is lower than the costs of innovation and development. Also, the costs of market education, marketing, and advertising are lower.

2. Forecast, risk, and fundraising - an innovative product takes all the risk in examining the market. A successful first product proves that there is a safe market to enter. It is also easier to predict the market and raise funds from investors, funds, and banks.

3. Learning - Learn from the mistakes and successes and use reverse engineering on the first product - improve, turn to the right segments and customers, and build a better product.

A study conducted by marketing researchers Peter Golder and Gerard Tellis of "Pioneers” and “Settlers” (waiting until the Pioneers have created a market before entering it) analyzed hundreds of brands. The failure rate was almost 6 times higher for Pioneers. Even when Pioneers survive, they only captured an average of one-third of the market share compared with Settlers. 

Is it worth working so hard to risk failure or risk being imitated and bypassed? Good question - some people dream to be Pioneers. But if you sit quietly and wait for the right opportunity to be a Settler, reduce risk, and better predict the market - do not feel bad, you are probably doing the right thing from a business standpoint.

[jonatanp]

Chilean Wine before Wine Brand

Which strategy should Concha y Toro choose? Bottom-up where they leave the "good for its value" brand to earn more for each bottle or Top-down to increase profitability by economies of scale? There is no one right solution or strategy that fits all companies and products. Each company has its own characteristics: brand perception, history, capabilities, quality, etc. In my view so far, every company is solely responsible for its own success or failure and can change direction according to its desires. BUT there is one major issue in the case that I haven't thought of - the cultural impact of the company's location is a very significant issue in its success - and unlike many other issues, it is challenging to "manage" that. Even more so,  Concha y Toro's brand is significantly influenced by all the wine brands exported from Chile. The failure or success of another Chilean brand directly correlates with the weakening or strengthening of  Concha y Toro's brand. It made me realize that, in fact,  Concha y Toro's direct and closer competitors in the domestic market are partners in building a brand in the global market - in which they compete together against brands from other locations. The case uses car brands as an example, and now I realize, for example, the brand importance of Japanese cars. Some Japanese brands may enjoy the brand Toyota and Honda created; however, it is enough for one or two brands of unreliable Japanese cars to "ruin" and change the whole consumer perception of the market. Then, one day looking back, we might say we remember that there was a time when Japanese cars were reliable. In conclusion, when setting up a business, it is important to think about the company’s “labels”, brand perception, and future dependencies which are not up to you, not in your hands, and cannot be changed or managed.

[jonatanp]

Consumer Behavior - Test or Avoid

For the past six years, I have worked in Analytics in the Adtech and Fintech industries, focusing on product improvement and user engagement. After dozens of experiments and A / B testing, I can confidently say that this science of understanding consumer behavior and behavioral economics does work.

Companies that invest in this field can significantly improve their financial metrics and customer engagement, but it requires knowledge, experience, good intuition, and analytical thinking. I have worked with amazing people in my experience, and I have seen many success stories, but also failures. Projects where we got the complete opposite of the goal we were seeking for. And why there are failures: 1. After all, it's not math, and many behavioral nuances are not always easy to put into the calculation. 2. Changes consist of many interactions, with many edge cases - sometimes the assumptions are wrong or not comprehensive enough. Therefore, if the company has enough traffic and data, it is crucial to test any change that is made in an experiment or A / B testing, which gives several advantages: 1. Know if the change has a positive effect. 2. Measure the impact of change. One change needs to be made each time an experiment is done in order to know the source of the effect.

In conclusion, if companies want to improve their metrics, they must learn and invest in customer behavior, but they must do so wisely and scientifically. During my professional experience, I learned the influence that companies have on customer behavior. It is essential that we, the consumers, know this material and remember and pay attention to these phenomena - we shouldn't be naive and shouldn't let companies "play with our brains" to change our consumption behavior.

[jonatanp]

"People don't drink beer, they drink marketing."

For years Heineken has unquestionably dominated the imported beer market in the United States. When you lead for such a long time, it can lead to arrogance and decreased motivation and ambition. Market leadership has made Heineken despise Corona and feel that it has the best and highest quality product. Heineken focused on product superiority in their advertisements to customers without investing in marketing, renewal, and industry analysis.

Corona realized the potential of the market. Young people (under the age of 25) are willing to spend a lot more on beer than adults and are also more open to imported beers. Instead of marketing a product, Corona sold an experience of fun, sun, and beach - a message that young people loved. Over time, Corona began to bite into Heineken's market share. Heineken did not adapt to competition changes, had no marketing, its advertising was product-oriented instead of experience, and its target audience was a shrinking market. Heineken later realized they needed to get out of the stagnation and work on their brand by changing the marketing and target audience to younger customers.

It seems that branding of experience and fun has drawbacks. Rumors about an inferior product and problematic ingredients would not have caught on in a beer like Heineken, which is branded as a "quality" beer. On the one hand, fun experiential branding can accelerate growth. On the other hand, it also has risks, and it can create volatility.

In conclusion, it is essential to find the right balance between brand, target audience, product, experience, and future influences in branding. But the most important thing is to be active and not stand still because, after all, we do not drink beer, we drink marketing.