How well does our system work? You can use the numerical index to check our blogs from the last big recession.
Much of the world suffered a severe recession from 2008 to 2011. During that time, we wrote more than 250 blogs using publicly available information and our Strategystreet system to project what would happen in various companies and industries who were living in those hostile environments. In 2022, we began to update each of these blogs to see what later took place and to check the quality of our conclusions. To date, we have completed the first 175 of our original blogs. You can use these updated blogs to see how well the Strategystreet system works.
The mobile phone hand set industry is fast growing, especially the segment known as smart phones, which combine the functionality of a limited PC or a good PDA with the normal telephone hand set functions. The new Palm Pre is entering this market. Let’s use the Customer Buying Hierarchy to evaluate the prospect for the Pre’s success. The Customer Buying Hierarchy (see “Video 27: Full Description of How the Customer Buying Hierarchy Works” on StrategyStreet.com) holds that customers buy a product using four categories of evaluation: Function, Reliability, Convenience and Price. Function (see “Video 13:…
Read MoreApple continues to impress with its moves in the smart phone market. On the one hand, the company did as we might expect. It introduced a new iPhone with more functions, but priced to compete with the other competitors, at about $200. In a fast-growing market such as the smart phone market, Function innovation (see “Video #31: Function Innovations” on StrategyStreet.com) drives significant changes in market share as long as these innovations are not copied by competitors. On the other hand, Apple did something that is not characteristic of high-end leaders. The smart phone market…
Read MoreThe consumer food industry has both an opportunity and a challenge in today’s marketplace. The opportunity comes as consumers reduce their “eating out” occasions and, instead, eat at home more frequently. The challenge is the seemingly inexorable market share growth of the less-expensive private label products. Some of the responses of the packaged food industry to these opportunities and challenges give us some insight into how to compete with low-end competitors and offset the ravages of a tough economy. Several of the branded food companies are instituting advertising programs emphasizing the value of their products…
Read MoreFor many years now, large employers and governments have contracted with pharmacy benefit managers (PBMs) to provide and administer drug coverage for their employees. In turn, the PBMs tell the employers that they will pass on a good part of their purchasing economies to save the employers’ cost. This approach has worked well for the PBMs for years. They have been highly profitable businesses. These high profits have attracted the attention of a new scary competitor, Wal-Mart (see “Video #3: Predicting the Direction of Margins” on StrategyStreet.com). Wal-Mart is offering businesses low-priced drugs if they…
Read MoreRecently, Europe passed legislation aimed at breaking long standing monopolies in Europe’s equity trading systems. As a result, a number of alternative trading systems poured into Europe’s equity markets. The new market entrants are offering new technology and lower prices. They have succeeded in shifting significant market share away from the former industry leaders. In fact, four of the new entrants now control 16% of the trading in Europe’s equity markets. (See the Symptom and Implication, “Most share shifting in the industry seems to be coming from volume gained within existing customer relationships rather than…
Read MoreIn February of 2009, we wrote a blog about Abercrombie and Fitch in a Leader’s Trap (see the blog, “A High End Retailer in a Leader’s Trap”). In that blog, we observed that Abercrombie and Fitch refused to discount its products in the marketplace, despite the fact that American Eagle Outfitters and Aeropostale, two of its main competitors, were offering lower prices. We noted that Abercrombie’s market share was falling, while Aeropostale’s was clearly on the rise. We predicted that Abercrombie would have to come out of its Leader’s Trap soon by changing its pricing…
Read MoreKraft Foods, Hershey Company, Kellogg and Campbell Soup Company reported higher profits recently. The key driver of these profit improvements was higher prices. For example, Kraft Foods’ profit in the first quarter of 2009 grew 10%, while its organic revenue grew 2.3%. Investors cheered because they had feared broad-based price rollbacks in the face of a tough economy. One analyst noted that the market share improvement for private label products has gone down sequentially. Why don’t we put that analyst’s explanation in different words? How about “private label brands continue to gain share” or, even…
Read MoreSeventeen years after the original blog below, two of its three protagonists have vanished into a single corporate parent, the fee fight it describes has been replaced by a hotel-commission fight nobody sees, and the company most responsible for reshaping how people book a trip wasn’t even founded when this blog first ran. This update covers what happened between 2009 and now: a wave of acquisitions because buying was cheaper than winning, a Leader’s Trap that outlasted the price cut that supposedly ended it, and a concentration in this industry so complete that the today’s…
Read MoreIndustries with a perishable seat, room, or ticket eventually discover real-time pricing. Airlines found it first, in 1978. Everyone else is still catching up, and catching up badly in a lot of cases. This blog lays out what real-time pricing is, what it takes to run, what it’s realistically worth in revenue and margin, and — the part pricing vendors leave out — where it has blown up in companies’ faces. The short version: it works, it’s not free, and the return is a lot smaller than the case studies you’ve been shown, and it…
Read MoreThere is a new pricing sheriff in town. In the right industry, this new approach to pricing can increase revenues and reduce demands on capacity. It often works well in industries such as airlines and hotels. Sometimes it doesn’t work without some careful adjustments. Here is an industry that needed the adjustments Posted 5/11/09 One of our local snow ski areas has started offering a “no wait” pass for snow skiers on busy days. The pass costs $20. This $20 comes on top of the normal day pass the skier has purchased. This additional pass…
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