Tag Archives: trends

Digital Commerce Continues to Grow

More than any single factor, the pandemic has impacted virtually all industries, but it has most impacted how consumers shop. Prior to 2020, consumers may have shopped online for many different products and services, but since mid-2020 buying habits have changed significantly. Consumers now feel more comfortable buying what were once in-person purchases such as cars, food, and medical or health care needs.

A recent survey by McKinsey & Co. highlighted that since the pandemic began, three out of four people have tried new shopping and delivery methods. More than half of the consumers surveyed intend to continue to use curbside pickup or delivery services after the pandemic ends. Roughly 70% of those consumers intend to keep buying online. Among the changes are increases in online streaming, grocery delivery, restaurant curbside pickup and delivery, and store curbside pickup. Consumers are going online not just for shopping; they now go online for medical appointments, fitness classes, tutoring, and more.

While these changes are good for digital commerce providers, they are not so good for traditional brick-and-mortar retailers. This year will likely see a record of store closings, bankruptcies, and liquidations. And, retailers have had to shift how they deliver services, including more online experiences such as digital events, contactless payment methods, virtual online services, and curbside pickup.

Overall, ecommerce in the U.S. rose to 16.1% from 10.8% a year ago. New shopping habits also extend to a decline in cash and an increase in credit and debit card use.

To quote Bob Dylan, “the times they are a changing.”

Group Activities and Discussion Questions:

  1. As class begins, poll students about their shopping.
  2. What are the last three websites they visited? Did they buy anything? Why or why not?
  3. How have their shopping habits changed this year?
  4. Do they have new online shopping habits?
  5. Will they keep these new habits once the pandemic is contained?
  6. Show video about how pandemic has changed shopping habits: https://www.wsj.com/video/the-future-of-retail-how-will-the-pandemic-change-how-we-shop/526ADB88-F6D1-4B77-AA97-BAA323496D4D.html

Source:  Wall Street Journal

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Peloton Adds New Products and Cuts (Some) Prices

The pandemic has been tough on most companies. Consumer demand for products has shifted, as well as buying behavior. Some companies won’t make it successfully through this period. However, unlike other companies, Peloton seems to have weathered the Covid-19 pandemic very well. Sales for home fitness equipment have been strong as gyms and fitness centers have closed or limited the number of patrons in their facilities.

Recently, Peloton expanded its product line with new versions, and has cut prices on older equipment by roughly 16%. Peloton currently sells two primary types of exercise equipment: a stationary bike priced at $2,245 and a treadmill priced at $4,295. When the new products launch, the new Peloton Bike+ will be $2, 495, but the older bike will be reduced to $1,895. The new bike will accommodate more than just biking and includes upgraded cycling, a better sound system, and a 24-inch touchscreen that swivels for yoga or weight training in a different area.

The new treadmill will be cheaper at $2,495 compared to the existing treadmill at $4,295. The new prices are intended to extend the customer base while still offering high-margin products.

Peloton continues to offer “connected fitness” to its subscribers, linking them to instructors and other workout fans so that even when working out alone at home, customers can connect with a community of other riders and instructors. Monthly subscription memberships are $39/month and the company currently has roughly 866,000 subscribers. In addition to cycling classes, the company streams yoga instruction, strength training, running, and more workout programs.

Ready to ride?

Group Activities and Discussion Questions:

  1. Discuss industries impacted by Covid-19. Which companies are winners? Losers?
  2. How has the pandemic impacted Peloton?
  3. Show Peloton’s Web site: https://www.onepeloton.com/
  4. What is the impact of the new products and price reductions for older products?
  5. Compare a Peloton bike and subscription to the average gym membership. What are advantages and disadvantages?
  6. Divide students into teams and have each team research and compare Peloton’s products and services to its competitors:
    1. NordicTrack: https://www.nordictrack.com/
    2. Echelon Fitness: https://echelonfit.com/
    3. Mirror: https://www.mirror.co/
    4. Tonal: https://www.tonal.com/
  7. What pricing strategies is Peloton using? Will this be an advantage or a disadvantage compared to the competition?

Sources: Associated Press; New York Times; Wall Street Journal; other news sources

 

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The Ford Bronco Returns to Action!

As we’ve written in previous articles, no product lives forever. There are always new innovations, trends, social forces, competition, and technologies that push products forward. Every product eventually reaches its final stage in the Product Life Cycle (PLC) – decline/harvest – when the product is put to sleep and resources are reallocated to up-and-coming new products.

But every now and then consumers grow nostalgic for products from the past. Perhaps the product brings back a happy emotion or a strong memory. Or maybe it’s a little bit of longing for days gone by. Or maybe it’s a desire for something different and cool-looking. Trends have a habit of cycling back as years go by.

New to the trend cycle is the resurrection of Ford’s iconic Bronco. The company has announced a new retro-looking Bronco that recalls the rugged, boxy looking original from the 1960s. (The Bronco was retired from production in 1996.)

Bronco has its work cut out for it as Jeep Wrangler holds the top position in the off-road automotive category. To compete with the leader, Ford has two Bronco models and pricing starts at $29,000 up to $60,000 for larger engines and more options and trim.

Welcome back, Bronco. It’s good to see you.

Group Activities and Discussion Questions:

  1. Discuss the stages in the product life cycle. What are the marketing objectives in each stage?
  2. How are cars moved through the PLC?
  3. Next, discuss the life cycle of the Ford Bronco.
  4. Show video introducing the new Bronco: https://youtu.be/-v1urLWR5zg
  5. How is Ford repositioning the car on the PLC?
  1. Show Bronco’s Web site: https://www.ford.com/bronco/
  2. Divide students into teams. Have each team draw a product life cycle and place various products and services into each stage.
  3. Next, have students brainstorm on how to reposition or revise products/services to that they can move into an earlier stage of the life cycle or be reinvented for a new life.

Source:  Wall Street Journal; other news sources

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