In a bad economy it is difficult to sell any product that is not an absolute necessity. On the other hand in a good economy the sale of these goods require little marketing. There are companies however, that face the daunting task of marketing products that are a hard sale no matter the condition of the economy. This paper will focus on the television manufacturing and funereal services industry to discuss the issues facing companies who must market products that are not an easy sell as well as discuss the impacts the exchange relationship when the customer does not want to be a customer. Issues facing companies who must market products that may not be an “easy sell In the age of technology companies seek to stay ahead of their field by being the first to come up with the next new trend. In the television manufacturing field as with so many others this has held true. In the late nineties the world was introduced to high definition televisions. Their sleek flat panel design allowed them to hang on walls making it captivating and an easy sell to those looking to buy a new television along with those looking to keep up with the trend of the day. As more and more manufacturers enter the market for them, the sale price was low enough for them to show up in many homes, replacing the bulky version of old regardless of whether or not they were still in good working condition. While the entrance of several high definition television manufactures was good for the customers, it required companies to lowers their prices which lowered their profit per item. This paved the way for the next new wave in television viewing to emerge. The invention of three dimensional televisions is another intriguing product in home entertainment however; their emergent would not be as easy of a sell as the high definition television. The first issue facing the sale of this product is the fact that many homes are in possession of their not so old high definition television. In an unstable economy, it is difficult to get consumer to give up their perfectly fine old stuff for an improve version of the same thing. Not only is this what three dimensional television manufacture’s face, but the auto industry also. Marketing professor Stephen Hoch (2008) suggested, “Retailers also face situations where consumers hesitate to buy a new product because they have a similar product that still works”. In the auto industry there is an easy fix
for this issue, offer to accept the trade of the currently owned car, which can be resold and perhaps in some cases make a small profit for the auto sales company taking possession of it. This however is not so easy when it comes to the sale of televisions. Transportation for many is a necessity a new television set is not. Therefor even with a trade credit it is not worth the upgrade cost. Spangler (2010) writes “The CTAM/Nielsen study found the most commonly cited reasons for lack of interest in purchasing a 3DTV include the cost of the set (68%), having to wear the 3D glasses (57%) and not enough 3D programming (44%)”. The exchange relationship when it comes to 3D Television is not about whether or not consumers want to buy or even the selection of a better target market, it is simply that there cost outweighs the wants of consumers. Impacts the exchange relationship
The relationship differs when it comes to funeral products and services. The consumer in this situation does not want to be a consumer; devastating circumstance has brought them to a place of need therefore, the greatest impact in this exchange relationship is emotion. Companies who deal in such capacities should approach this relationship with caution. Those workers dealing directly with the consumers in this case are on the front line of the company’s marketing strategy. In many cases these consumer lack knowledge of the products and services being offered, and perhaps too emotional to care, which makes for a time to take advantage of a consumer. However, it is in the best interest of the company to proceed with caution, care and concern. Mullins (2010) writes, Many exchanges are necessary for people and organizations to reap the benefits of the increased specialization and productivity that accompany economic development. But such exchanges do not happen automatically, nor does every exchange necessarily lead to a mutually satisfying long-term relationship.
Although consumer buying funeral services are not there because the want to be there, they do have a need. Because there is traditionally very little marketing efforts made to increase popularity amongst competitor in this field it is up to those on the front line of sales to create a positive experience. This in itself is a type of marketing, and creates a mutually satisfying and hopefully long term relationship. Along with consumer loyalty
word of mouth advertising, means a great deal for companies that are in a position to sell to consumers who don’t want to be consumers.
Marketing to the right consumer is a tough task with any product when there is a weak economy. The task becomes even greater when the products are not wanted buy consumers. Cost plays a big role and is an issue for both sides of the exchange relationship. A customers needs also plays a role. A company’s ability to forecasts what consumers needs and wants are as well as what they will be will to pay are all issues that companies face with a hard to sell product.
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One of the most important questions in all businesses is, whether businesses have any moral responsibilities at all beyond simply earning as much of a profit as possible for their owners? If you look at it from the business point of view they are only responsible for making a profit. The company is an agent of the shareholders and is responsible only to them, and only for making a profit. Looking at it from the consumer point of view the company is responsible to everyone who has a stake in the operations of that business, that is, everyone who is affected. This includes shareholders but also employees, consumers, suppliers, and the surrounding community. I feel that answer to that question is yes, businesses do have moral responsibilities beyond the company making a profit. I believe that a company has to be moral beyond its standards because it is obliged by utilitarianism. Utilitarianism can be defined as an ethical theory that is based upon the moral worth of an action, which is primarily determined by its contribution to overall utility in maximizing happiness or pleasure as a whole among all people. The adequacy of utilitarianism can play a huge role in a company’s morals because it can be seen as the only intrinsically valuable end. Companies have to make many important decisions that may affect a great deal of people, but when these decisions are made whether by a ceo, executive board of directors, or middle management all aspects of the outcome should be taken into deliberation. A group of people come together and form a company so that they are able to accomplish something collectively that they cannot accomplish separately. If companies can produce goods and services more efficiently than the individual then it is not unreasonable to say that they should have standards of morality and ethics above those of the individual. Collective standards of ethics and morality should be more vigorous than those of an individual. Moral responsibilities are about businesses and organizations going beyond the legal obligations to manage the impact they have on the environment and
society. Companies interact with their employees, suppliers, customers, and communities in which they operate, as well as the extent they attempt to protect the environment. In an effort to continue having a strong relationship with its environment and consumers the company should do whatever is necessary to keep them happy. If a company does just the minimum, then it is clear that if there wasn’t a set standard such as legal obligations, then they wouldn’t abide by them at all. If a company exceeds its obligations then, it is clear that the company is going beyond the expected for a reason, which is to satisfy its consumers. When a company does things such as questioning shareholders, employees, customers, and outside experts about how its services and infrastructure impedes - or might be able to help economic development that shows that they care and want to see things change for the better. Without a sense of morality and ethics, they can disadvantage large sections of the world to benefit their shareholders. Some of the management excesses associated with these corporations suggests that sometimes they are not even fully accountable to shareholders.
As Kant stated an action is moral in itself not because of its consequences but because any rational being wills it to be a universal law and it does not contradict itself. It is true that being moral and being legal are not the same. Morals are a set of conducts that are not enforceable such as laws. With the two being different, it usually raises the issue whether companies are or should be moral in which the acts they partake. There are many laws that have come about to reduce dishonest acts but they still can’t implement the company to be moral. Morality may be viewed in many different ways because not everyone will see a particular issue in the same sense. Businesses have the upper hand when it comes to helping. There are times when failing to help is to harm, so companies could be considered morally wrong for not doing good. Companies obligations to the world as far as how moral they should be depends upon the company or business. For instance the automotive industry should really focus on trying to make if they haven’t already done so on making more fuel efficient/hybrid vehicles to reduce emissions. Many consumers enjoy the pleasure of riding in larger vehicles such as SUV’s but those vehicles produce the most pollution. In order to
reduce the pollution while still producing quality and enjoyable vehicles to travel in, they should focus on ways of working the two out for the greater good of the company and consumer. Education is another important factor that can be used as a moral responsibility when it comes to consumers. Companies should have educations program set up for students, especially rising college students because they will be the people that may come and work for the company or enter corporate America so companies should engage in funding to assist young adults in furthering their education. A business doesn’t have to be limited with their moral responsibilities, but I think that they should at least focus on the area in which their company provides business. A company may not be responsible for making the world a better place, but it is responsible for avoiding harm. Vicarious liability, whether in ethics or the law, is a responsibility arrangement in which the party held to be liable to punishment or other responsive measures is not the party that performed the morally or legally faulty action that caused some harm or other untoward consequence. An example of vicarious liability applied to individuals is the assumption in some organizational settings that the person at the top of the hierarchy of authority is ultimately liable for the actions of the organization and its members. For example, global warming, there are ways to prevent global warming such as being supplied by renewable energy, create zero waste and sell products that sustain the resource and environment. Not all companies are trying to prevent things of that nature, which only leads to the continuation of these activities that will affect us all in the long run. When a company is morally responsible outside of its standards it benefits them more than it could hurt them. Many business people appear to be finding that by acceptance stakeholder theory they are enhancing shareholder wealth. Taking on a moral position is more of a business opportunity. If corporate managers take their eye off profit maximization as the only reason for their existence, then long term they tend to be more profitable and stable. Social responsibility and sustainable business practice are, of course, no guarantees of success. Socially responsible companies fall if management practices are not sound but, a combination of good business practice with social responsibility and sustainable business practice will give advantages not only to shareholders but to other stakeholders. A corporation, in spite of its organizational
complexity, is ultimately a group of human beings engaged among themselves in various specific occupational/professional relationships that each believes to be in his/her self-interest. Corporate actions result from policies and procedures intentionally designed by members of the corporation to achieve specific goals. When harm or wrongdoing occurs, individual members are morally responsible in proportion to the degree each participated in policy formulation, implementation, or error.
While profits are an important factor in the life of a business, everyone in society to at least make an attempt to make life better. Businesses rely on society for their businesses to operate and would not run if it weren’t for society. Businesses need the infrastructure that society brings to the table such as consumers and employees. A business that lives up to its moral responsibilities, lives up to its obligations and to the mutual benefit the company and its consumers so a global common can be created allowing everyone that plays a part, to benefit and reap the rewards of the company.
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1. How did the idea come about? Spa and wellness has been an emerging business in Singapore due to changed mindsets and values of the people.
With rising affluence, people are more willing to spend time and money to improve their health and indulge in spas. Also, due to the increasingly competitive society we live in, people are dealing with much more stress than in the past and visiting wellness centers appears to be one of the top picks for Singaporeans to get away with stress. In addition, Spa and wellness centers are also an appealing alternative to medical centers to receive medical treatment as many spa centers now offer treatments for health improvement and tuning.
However in Singapore, there seems to be no existing spa and wellness center targeted at the elderly. Since spa and wellness centers are set up predominantly for people to de-stress, indulge and improve their health, this should be a feasible business to be targeted at the elderly in Singapore.
2. Why is it a business opportunity? Singapore has witnessed a great surge in the number of elders in the recent years as a large portion of the baby boomers approach their prime ages.
The medical breakthrough and advancement of the past decades had benefitted people and enabled us to live healthier and longer. This is reflected in Singapore where the life expectancy at birth of Singaporeans has increased from the estimated lifespan of 78 years in 2000 to 82 years in 2011 (refer to appendix 1).
According to the Age pyramid of Resident population provided by Singstat (refer to appendix 2), people of age groups 55 - 59 and 60 - 64 in 2012 is double the amount compared to in 2000. This depicts the rapid aging of Singapore�s population. It is projected �that as almost a third the people in the city-state will be over 65 years old in a few decades�. (yini, 2012)
With the increase in elderly population in Singapore, this entails a huge target market for businesses targeted at the elderly. More products and services are now catered to the elderly market such as the elderly-friendly mobile phones, robots and technology etc. This is due to the fact that the elderly consumers have ample spending power with the accumulated savings from their working life. It is also observed that elderly spend a notably amount of their savings on healthcare, further enhancing the appeal of the elderly market to the spa and wellness sector.
In virtue of the mentioned points above, the spa and wellness business should not forgo the opportunity to break into the emerging elderly market in Singapore.
3. Protecting the business idea: There is currently no existing spa and wellness center for the elderly in Singapore and this can be the first. However, there are already existing elderly wellness centers overseas therefore the idea cannot be patented. To protect the business, we can have a trademark for the company name and logo which would enable customers to identify us easily and distinguish us from our competitors. The trademark will be registered at the Intellectual Property Office of Singapore (IPOS) and would last 10 years that can be renewed indefinitely.
4. Nature of industry Spa and wellness falls under the service industry where it offers healthcare services and related products to the customers.
The market size of the Spa and wellness industry in Retail Value is assessed in year 2011 is at a whooping value of 21.4 million (refer to appendix 3), portraying great potential in the industry. The market size has grown steadily over the years and industry experts have a positive outlook of the growth of the spa industry in Singapore as well as the whole of Asia.
The competition is the spa industry is vigorous with the presence of a large number of competitors in the industry. To name a few of the renowned spa businesses in Singapore would be Amore Boutique Spa, St Gregory etc. that has received recognition from the market. In addition, the spa industry also face indirect competition from substitutes like massage chairs and equipment, now even hospitals and private healthcare institutes as the spa industry gradually converge with the medical industry in providing medicinal treatments. However, these indirect competitors do not pose a great threat to the spa business generally as it is unable to replicate the Spa experience.
4.1 Regulatory environment In Singapore, the spa industry is strictly governed by government rules and regulations which create substantial barriers to entry as operators must acquire a license before launching the business. A massage establishment must acquire a Massage Establishment License that controls the operational hours of the spa, age of customers admitted, etc. The spa company must also be registered with the Singapore Companies Registrar, ACRA prior to obtaining the license.
To protect the interests of the consumers, the CaseTrust Accreditation has specified criteria for the operation of the spa business to instill consumer confidence in the sector and ensure fair trading practices.
5. Industry/ Market trends The spa and wellness industry is experiencing exponential growth in Asia and in Singapore. The fast and stressful lifestyles of the people of our time had given rise to the industries providing relaxation therapies and created demand for recreation activities.
5.1 Economic trend In Singapore, the spa and wellness industry had expanded significantly. Statistics have shown that the spa business is lucrative one as the Retail Value of the spa market has increased from 13.7 million in 2006 to 21.4 million in 2011. (Refer to appendix 3) Factors such as the increase in disposable income and change in lifestyle of consumers in Singapore contributed to the growth of the spa and wellness industry as people are more willing to spend money on luxury items.
5.2 Societal trend The spa industry has also witnessed trends such as the growth in Medicinal spas due to the fact that Singaporeans are getting more health-conscious. Spa and wellness is no longer restricted to relaxation and indulgence but also the treatment for medical conditions. These medicinal spas are an alternative for medical treatments in hospitals and healthcare institutes where the tranquil environment of the spa center is the plus point as compared to hospitals.
The target market of the spa industry has transformed in the recent years. The target market is no longer restricted to middle age women with spending power as the businesses now target at the younger crowds with increasing spending power. As men are increasingly conscious of their images, spa and wellness centers for men have emerged.
6. Analysis & Feasibility 6.1 Business analysis Elderly spa and wellness center is definitely feasible as there is a large market with the rapid upsurge in number of elderly in Singapore. The upsurge in number of elderly translates to the demand of elderly centric services and products. This is demonstrated through the increased government spending on elder care facilities in Singapore. (Estopace, 2012)
Secondly, it is noted that the elderly in Singapore spend a lot on healthcare as they get on with age. This means business for the elderly spa and wellness center as the center may offer medicinal spa and treatments to treat their ailing elderly pains and improve their health. Hence, the center would be able to cater to the healthcare need of the elderly. Singaporeans and elderly alike are also becoming more health conscious. They are now more receptive to healthcare treatments than in the past and are willing to receive these treatments to improve their health and prolong their lives.
The elderly now have a lot of time and wealth on their hands with the savings accumulated from working hard for the majority of their life and the allowance given by their children. As they enter their retirement phase, the elderly would spend time and money to participate in recreational activities to lead a fulfilling golden age. The elderly spa and wellness center can become a place for the elderly to tune their health and at the same time relax and rejuvenate.
6.2 SWOT analysis of the Elderly Spa and Wellness Center Strength � Unique product offerings that cater to the elderly differentiated from the other spa centers, first mover advantage as the first spa and wellness center targeted at the elderly Weakness � Target market is relatively restricted to the elderly as people may generalize the center to be a place only for the elderly, lack of experience in creating spa and wellness product for the elderly Opportunity � Aging population in Singapore, increase in demand for luxury and recreational goods in Singapore Threat � Emergence of similar businesses, stricter government regulations in the spa industry
7. Competitive advantage Being the first and only elderly spa and wellness center in Singapore, the company is given the first mover advantage being the exclusive elderly spa and wellness center. As our target market differ from the primary market of typical spa businesses, our products and packages are specially crafted for the elderly such as Medicinal spa, traditional massages, acupuncture etc. that are differentiated and unique product offerings compared to others in the market. Being the only elderly wellness center can also help secure the customer base as well as allow the company to gain expertise in serving the elderly market by piloting a wellness center targeted at the elderly.
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