10/26/2012 7:42 PM
Whew, what a week! Three assignments due at once, plus an upcoming test, and another major project being announced on Saturday. Hurricane Sandy is upon us and this weekend in Manhattan may be an adventure – ominous warnings about the perfect storm are everywhere. But, we’ll be studying – nothing will stop us!
Even though the week was incredibly packed, it’s been GREAT learning about the world of finance and taking time to reflect and build a marketing plan for a web 2.0 company.
For Finance, we created an overview and assessment of the company Waste Management. It is absolutely AMAZING the amount of information you can find on the web about companies, executives and competitors if you know where to look. We learned a good deal about the direction the company has been going in recent years and that they are innovating and doing research into creating energy from waste.
In Marketing we have been reading about pricing. There are several philosophies around how an item’s price can be arrived at. Some of them, while ‘purist’ in their capitalist nature, are a bit troublesome. There are philosophies that say “price your product at what people will pay for it”, which leads to premium branding and high pricing for some customers who wish to pay higher amounts (even if the actual product itself is not extremely different from other more moderately priced products). There are other philosophies that say “pricing should be arrived at through algorithms with targeted margins above cost that will return consistent profit”. This can lead to overly mechanistic management of lines of business, with an almost blind loyalty to hitting the specific margin numbers. Although Wall Street and Main Street do seem to reward both of these models by participating as actors in the consumer role, I found both of the above approaches problematic and unbalanced. My favorite reading of the week was an article by Peter F. Drucker. With Mark Twain-like wisdom he laid out several principles about what really makes sense when pricing products. It’s a balance of using good judgment and staying customer focused. I’ve always found that’s the ticket. Lose sight of that and you may as well hang it up.