Consumer-Led ParadigmConsumer-Led ParadigmHip consumerism1960s: Creative Revolution prior 1960’s was producer-led paradigm, but 1960s on is a consumer-led paradigmParadigms comparedProducer-ledProduct,PricePromotionPlaceConsumer-ledCommoditydifference is that a product sits on a shelf and you get to buy (physical thing), a commodity is not a thing but it is consumer satisfaction, that’s what you are trying to sell, often gained by a combination of multiple productsCostinstead of prices, meaning the cost of buying and using a product and serving consumer satisfaction is much broader than just how much someone pays for that productThink about a new phone, after purchasing you have to activate it, add new contacts, etc. (effort and time involved those are costs too, more than just price)CommunicationTwo way dialogue between company and consumer rather than one-way deliveryConvenienceTrying to make it as convenient as possible to purchase this product, you can do it online and on the phone now. Physically where the product is available isn’t important, but rather making the product purchase as convenient as possibleParadigms comparedProducer ledMarket managerFormulaic advertising (reason-why)Accept consumer societyGoal of fitting in, social acceptanceThe ads want you to feel that you can gain happiness through buying products, you can fit inConsumer-ledRather than focusing on a manager who decides about the 4 P’s, this is focused on delivering consumer satisfaction, their desires are much more importantHip consumerismIt doesn’t say not to buy things, it says if you purchase certain things then it is an act of “hipness” rather than an act of conformityHip consumerism advertising urges people to buy products and rejecting consumer society but rather standing out through buying this productThe argument why you should buy products are completely opposite with consumer led and producer ledDesign comparedProducer led designThe company is the one who decides what to make and what features it will have (company control)They put the stress on functionality, standardization, one product fits allConsumer led designRather than company deciding what to do, they figure out ways for the market to tell them what to do (market control)Stress on style rather than functionality“What a company offers for sale is determined not by the seller (the producer) but by the buyer (the consumer)successful companies don’t make the decisions, they let their markets make their decisionsSony WalkmanUsed consumer led thinking to advantage1979: the Sony WalkmanPreference research not sufficient, up until 1960s market research was called “preference research”, what you do is get some of your market in a room and put different products down (with competitors) and see which they prefer  get a fix on their competitors, but problem was people were choosing from products that already exist/they already know ofYou know you need a new product that doesn’t exist, but you don’t know what it isSONY did this by: turning to social trends and lifestyle research (sent researchers out into society and observed and studied the everyday lives of the target markets)  thought about what their market would latch onto but doesn’t have yet  came up with idea of this WalkmanSocial trends and lifestyle research is a way for companies to innovateDemand for style/meaningSony made many different models, a different one for everyoneRealized people were latching onto the meaning of the productEx: “sport” Walkman, more rugged version meant for hiking, but found that vast majority of buyers of this were not outdoorsy people, rather they liked the way it lookedSuggested that the people who bought the sport had little practical need for it, but it expressed a lifestyle to people who would see them with productCultural and emotional satisfactions, not just emotionalSwatch (1983)Consumer-led approachIt was a response to Swiss companies’ high labor costsMarket for watches was: cheap, digital watch OR expensive brand name watches  UP UNTIL SWATCHSwatch didn’t try to fit into either of the two, but made a 3rd market with the idea of watch as a: fashion accessoryOne for every outfit, mood, situation  emphasis on stylingSwatch: standardized function to make inexpensive, but made many styles of the watch fitting different lifestyles, new collection every 6 months with 24 designs in eachExpress niche lifestyleSports peopleTrend conscious peopleDesign and technology peopleConservative, sophisticated people (traditional watch)Etc.Hip Consumerism (with advertising now)Advertising in the consumer-led paradigmThis is advertising urging you to buy products for very different reasons, buying the right kind can set you free and enhance individual freedomHelps you stand out, not conformHip Appeals: CarsEx. Toyota ad: “rise up and take to the streets”The language is about social protest, benefit is that you stand outHit Appeals: computersApple: we are the innovative and creative, we will help you stand outCelebrate the “streets” as realLG has done this, in order to sell its new line they developed a spot linking it to the street making it seem authentic to outsidersAds that criticize authorityAds that make fun of bosses (having no morals, etc. )Reject the mainstreamCertain products help you reject the mainstreamEx: car pulls up to a party, then they pull out because screw the party and keep driving to look at the stars in their carEx: beauty product, you can invent yourself and define your own beauty, it isn’t about what the standard of beauty isAds that make fun of ads“get rid of cable, and upgrade to direct tv”, goes way over the top on purposeAds that declare independence“your heart is free, have the courage to follow it”—affliction clothing allows you to “live your life” how you wantKey Points:Consumer-led paradigmKey shifts from emphasis from function to styleFrom company decisions (about product changes) to marketing research (changing product to what the market wants)Corresponding change in advertising, empahssi on hard-sell formulas to hip consumerism ads—all about buying products to enhance independence)So changing relationships between companies and markets (companies listening to markets)Thus changing advertisingADPR 3100 1st Edition Lecture 7 Outline of Last Lecture I. Creative Revolutiona. Growing importance of style b. Cynicism about consumer societyc. Creative