#M4BW Japanese companies use technology to create value for an aging population

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Japan is concerned about how it will care for its elderly—especially those with dementia. The Japanese population is aging quicker than most of the world. Already, a quarter of the Japanese population is 65 or older (compared to just 15 percent of Americans). By 2025, Japan predicts a shortfall of almost 400,000 senior caregivers. Some companies are developing different intelligent agents to help fill the void.

Robots are particularly popular. Sony’s robotic pet dog Aibo, and SoftBank’s Paro, a robotic baby seal, have been shown to elicit emotional responses and yield benefits similar to live animal therapy (without all the owner responsibility). SoftBank Robotics’ humanoid companion “Pepper” recognizes faces and human emotions and asks and answers questions; seniors enjoy chatting with Pepper, which also monitors patients’ mental health for doctors and family members. Advances like these can provide health care at lower costs and make for better experiences for an aging world.

For some more background you can have your students read “Japan Lays Groundwork for Boom in Robot Carers,” The Guardian, February 5, 2018 and “Toyota, SoftBank Join Forces to Build Self-Driving Cars That Deliver Meals, Health Care,” Wall Street Journal, October 4, 2018 (subscription may be required).

This describes a demographic trend (part of context and the external market environment in Chapter 3). It might also tie into a discussion of market segmentation (Chapter 4) or product (Chapter 8).

Emerging “Two-Tier Economy” Changes Product-Markets

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bmwm4The economic recovery in the United States has not been the same across the income spectrum. While the wealthiest 5% are doing quite well, those in the traditional “middle class” have not seen similar gains. This Wall Street Journal article “How a Two-Tier Economy Is Reshaping the U.S. Marketplace” (January 29 2015, non-subscribers click here) points out that those at the top 5% of the income scale spent an inflation adjusted 12% more from 2009 to 2012. During that same time period, the bottom 95% spent 1% less. It also reports the top 5% now account for 30% of all spending — up from 23% just twenty years earlier. The article details some of the implications for sellers of cars, houses, and beer. Hint, apparently that $64,000 BMW M4 (see inset photo) is a hot seller.

Similar income distribution exists in China — and this has influenced the smartphone market there. Another Wall Street Journal article “In Smartphone Market, It’s Luxury or Rock Bottom” (February 1, non-subscribers click here) which describes the Chinese market, where Apple’s iPhone stands alone as a “luxury” and brands like Xiaomi (at on third the price of an iPhone with similar technical specs) dominate the low end.

This story has implications for when you cover segmentation and targeting (many of these firms are now targeting premium or budget — not the middle any longer) or consumer behavior.

Will Millennials Save the Shopping Mall?

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millennialsmallThe growth of online retail has many pointing to “The death of the American mall“(The Guardian, June 19, 2014). While some American shopping malls are struggling, others are thinking that Gen Y’s shopping habits fuel a recovery. This article in USA Today, “Millennials’ buying habits may save the mall” (November 8, 2014) describes that trend . Our students enjoy reading about their impact on marketing strategy, so they will find this article interesting. We have also posted it at Learn the 4 Ps.

The data in the image comes from an April 2014 study by OpinionLab reported by 9News Denver.

Dog Food Companies Battle on Store Shelves and In Court

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The dog food market is very interesting. The premium end of the market is especially interesting. As more of us view he family dog as “part of the family” we are also more willing to spend more on what we feed our dog. Our textbooks have a great video on this topic – “Targeting the Premium Dog Market: Cashing in on ‘Doggy’ Love.” Many of our students have dogs (or cats, or other pets) and can relate to this market.

I have come across an article, a news story, and a spoof to offer you something to talk about when you cover consumer behavior, advertising, entrepreneurship, or legal issues (Lanham Act). An extended article in Bloomberg Businessweek “Dog Food Fight! Purina Says Blue Buffalo Is ‘Built on Lies’” (July 24, 2014) offers some insight into a legal battle between Purina and Blue Buffalo. The same article describes the very interesting rise of Blue Buffalo by a former ad-man who also founded beverage company SoBe which he later sold to Pepsi for $380 million.

For a short (2:37) take on the legal battle, see this video clip below from ABC’s Good Morning America.


If you want to have some fun, you could show this Saturday Night Live skit which spoofs Blue Buffalo.

Ideas for class include using this as an example of changing social and cultural values and its impact on consumer behavior. You could also use the first ad to discuss the Lanham Act and legal issues in advertising. The Blue River dog food story in Businessweek shows how important marketing has been to this upstart firm.

Technology Is Changing Our Relationship With Driving

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Screen Shot 2014-06-30 at 7.18.05 AMSome technological and social cultural trends are beginning to have an impact on how Americans drive. Think about smartphone based services like Uber and Zipcar — which may make car ownership much less necessary. Google’s self-driving car is on the horizon. And people are more and more interested in city living. This Fortune article “The end of driving (as we know it)” (June 12, 2014) highlights these trends.

I like to encourage my students to anticipate trends and think about the future. I will have them read this article and ask a series of questions:

  • What industries could see these trends as threats?
  • What industries might see these trends as an opportunity?
  • What new goods or services might leverage these opportunities?

Encourage your students to move beyond the immediately obvious examples — automobile manufacturers — and encourage them to consider other industries (say hospital emergency rooms that do a lot of business from automobile accidents — which should decline significantly with self-driving cars).  These questions are designed to help them recognize and anticipate change. You might use this when you cover the external market environment, demographics, consumer behavior, or marketing strategy planning.