Scott Galloway provides a short video where he shares some crazy statistics about Amazon. For example, did you know that within 45 minutes of an order being placed at Amazon, it is already loaded on a truck! In that video, Prof G also references a book where you can get many more details, Arriving Today: From Factory to Front Door — Why Everything Has Changed About How and What We Buy. This short video might be fun to show in class when you cover Chapter 3 (where we have a chapter opening case study of Amazon), Chapter 11 (logistics) or Chapter 12 (retailing).
This short (9 minute) Planet Money podcast titled “Full (ware)house” covers some interesting trends in the warehouse space. One current situation is that in spite of a boom in warehouse construction, there is a shortage of space. A second trend is a movement in where warehouses are located — with them moving from rural locations, to the exurbs, suburbs and even into urban environments. The idea is to have goods stored closer to consumers for faster delivery. All this is driven by changing consumer shopping habits.
This is a great example of the effects of the pandemic. As the pandemic accelerated online shopping, companies found they were more willing to pay for higher priced storage closer to consumers. I find my students like to listen to short podcasts as a supplement to the textbook chapter. The topic can lead to interesting classroom discussion when you discuss Place in Chapters 10 and 11.
My students are often curious about how the pandemic has influenced marketing strategy planning. The biggest example are the supply chain problems (Chapters 10 and 11) we read or hear about all the time. Those have clear implications for consumers who cannot find that new bike, toy, or automobile they are willing but unable to purchase. What are the marketing strategy implications?
First, there are implications for retailers (Chapter 12) who lose sales when their shelves are empty (or at least not fully stocked). That costs them sales and goodwill. Second, it can lead to higher prices (Chapters 17 and 18) which contribute to inflation (Chapter 3) which are specifically addressed in this article “Supply chain woes lead to pricy outdoor recreation products.” The article gives an example of a Kelty camping chair that will jump in price from $109 to $139 because shipping costs for a container have jumped up to 10x. All told, a great example that ties together a range of concepts in the textbook and the real world. A great example to share at the end of the semester.
Several product categories have seen costs spike during the pandemic. While supply chains get plenty of well-deserved blame, there are more reasons than that. These videos might provide an opening to discuss this topic in class. The Wall Street Journal video “The Surprising Ways Inflation is Hitting Diapers” (August 4, 2021), describes how diaper makers costs have risen – everything from raw materials to freight costs. In addition, changing demographics (fewer babies born) has the two big diaper companies raising prices to offset lower unit sales. The result has been an increase in diapers prices of 12% in the last year.
Along the same lines, coffee prices have also soared (up more than inflation over the last five years)– see another WSJ Video “Your Coffee Is Getting More Expensive. Here’s Why.” This article describes how shipping costs have contributed to those rising prices. Together, these articles can show your students how prices are influenced by demographic trends, raw material costs, and freight costs. And coffee (maybe diapers) are product categories students understand.
Earlier this month, the United Nations’ Intergovernmental Panel on Climate Change issued its latest report on the climate. It was not encouraging and clearly points to the need for the world to limit carbon emissions. Many cities and businesses are stepping already trying to do just that.
One opportunity for lowering emissions is the so-called “last mile” for online retail. This is the delivery to customers’ homes and businesses. This is seen as lower hanging fruit. So the city of Seattle is experimenting with some low-cost options, including cargo bikes, electric vehicles and pallets, and food trucks. This opportunity is leading to some innovation around delivery.
This Fast Company article describes “Seattle’s new zero-emissions delivery hub is an experiment in slashing e-commerce emissions.” This video (also shown below) describes some of that innovation. In Essentials of Marketing, we discuss innovation as a benefit of marketing (Chapter 1) and as part of new product development (Chapter 9). And of course this topic is relevant to distribution (see chapters 10, 11, and 12) Our textbook also covers sustainability in chapters 1 and 19.