Products & the 80-20 rule of marketing

-Jake

Through any entry level marketing class you learn of the four P's of marketing. These are Price, Promotion, Product, and Place. Within these, the largest category by far is product. Having good quality and high demand products is important for a company to continue to operate well. Simply put: if companies didn't have products to sell they would make no money. 

It is very common for people to know, or at least know of the four P's of marketing. But it is very uncommon for an average person to be knowledgeable about the 80-20 rule. Although this is not a well known rule, it plays a crucial role in how executives in a company should think about the other three P's of marketing. The rule states " 80 percent of a typical company's revenue is derived from 20 percent of its products or services."(Writer)

As you know from my previous blogs, I have previous experience working with State Farm agencies. For consistency, I will use the example of State Farm again. State Farm is a massive fortune 500 company with many products that they provide. These include insurance (vehicle, homeowners, health, life, renters, recreational vehicles, &boats), financial products (such as credit cards and certificates of deposit), vehicle loans, and mortgages. But within these products, vehicle insurance is by far the largest component. According to State Farm's financial records from 2015, auto insurance alone accounted for 62% of the companies gross revenue earning $36.3 billion for the company.  

Out of every single policy that state farm offers one product alone accounts for 62% of their revenue. This is very standard among companies. Because of the way the products are weighted, companies should shift their other P's, specifically price and promotion, in order to maximize there revenue while still staying competitive in the marketplace. It is much more effective for companies, and people, to focus on growing their strengths as opposed to diversifying their weaknesses, so large companies like State Farm should focus their  promotions around their large items like auto insurance. After this has happened and they have a large customer base they can focus on growing their brand by up-selling their current customers with more products. 


Sources

Branded, Purely. "The Four Ps of Marketing." Purely Branded. N.p., 01 Aug. 2016. Web. 16 Apr. 2017.

State Farm® Announces 2015 Financial Results. N.p., n.d. Web. 16 Apr. 2017.

State Farm Distracted Driver Detection | Kaggle. N.p., n.d. Web. 16 Apr. 2017.

Writer, Leaf Group. "What Is the 80/20 Rule of Marketing?" Back. Azcentral.com, 24 Sept. 2012. Web. 16 Apr. 2017.

Synthesis Post

-Jake, Steve, Zach

Business is a very vast field and includes various topics. These require a wide range of skills to be successful. Some of these fields include marketing, advertising and supply chain management. In order to be successful in these positions you need to excel in communication, money management and basic office skills.    

The Business Majors

As you start to consider going into business, it is important to find a specific major that suits you well. But within business there are multiple different fields and it can be hard to find the major that fits you best. Among the field of business, majors include: hospitality business, supply chain management, human resources, finance, accounting, marketing, and general management. The difference between these fields can be extremely confusing. Because of this, we have attached the following links for further explanations of fields that people find complex.

• Supply Chain Management
• Marketing
• Marketing vs Advertising

Communication

Communication is a must have skill in every field. Knowing how to interact with and treat people in an ethical manner is sought after by many employers. Customer service would be one business field in particular that requires excellent communication skills. If you are looking to get hired, you will need to excel in face to face interviews in order to become employed. We will be giving you tips and advice about communication in the blog posts below.

• 5 tips to keep a conversation going
• Preparing for an interview
• Exploring communication
• Golf and Business
• Defining Ethics

Money Management

One very important skill in the business field is the knowledge of how to manage your money. There are many different ways you can save your money. One example of managing your money is how you are saving for your future. This includes maxing out any company sponsored 401(k) plans offered to employees or making sure you are financially prepared for any unexpected events. Another example of managing your money is how you plan to pay off possible student debt or pay for your child’s future collegiate career. Taking out student loans and saving a certain amount per year to pay for future college education is a popular route used by many in today’s society. Overall, money management is only a small part of business, however it is very crucial to one’s success.

• How to Beat Retirement
• The Battle with Student Debt
• Paying For College

Extraneous Applications

Before going into the real world there are things that will benefit you both in finding a job and succeeding in it. These include a basic knowledge of microsoft office, forming effective resumes/cover letters, and gaining key experience within your field.

• Interview Preparation
• Resume  
• Cover Letters
• Job Experience

Works Cited

Leddy, Chuck. Effective Business Communication: 8 Steps to a Better Conversation. N.p., n.d. Web. 12 Apr. 2017.

"North Dakota Youth." Money Management | North Dakota Youth. North Dakota Department of Human Services, 09 Sept. 2010. Web. 12 Apr. 2017.

"5 Struggles Of Majoring In Business." Odyssey. N.p., 05 Apr. 2016. Web. 12 Apr. 2017.

Recognizing Significance

Prompt #9
By-Zach


Business has a huge impact on todays society even if most people don't notice it. Click here for details on how business effects our lives. I will be going over most of what the article offers and will be describing in detail how business can gain from these impacts as well.

Impacts on Children

• Education- Business can provide books for children to read
• Jobs- Employment opportunities for the youth
• Training- Experience in the workplace

All of these are important impacts that business has on children. Effecting kids the right way from the start is a great way to promote healthy business ethics and increase customer loyalty.

Impacts on Family

• Income- Provides a reliable source of money
• Independence- Makes families self dependent
• Jobs- Helps local economy
• Materials- provides valuable materials to families 

Family's are impacted by Business. Providing a source of income and jobs both helps the economy and families themselves.

Impacts on Country

• Jobs- Business creates jobs and helps the economy grow
• Raising awareness- Business can promote the awareness of various subjects
• Materials- Business produces products that meet peoples needs
• International Relations- Helps build relations with other countries.
• Taxation- Country can tax businesses for money which generates more income.

Businesses Have a major impact on countries and local economies. By Improving international relations with other countries trade will become more abundant making business easier to do internationally. Raising awareness for diseases or charities can be done by television or billboard advertisements. 

Sources
Brooks, Marissa. "Pollution and How It Affects Us." SciVee (2010): n. pag. Web.
https://www.unicef.org/csr/css/How_Business_Affects_Us_report_on_children_s_consultation.pdf

Evaluating Sources

Prompt #6
By: Jake

Through the Michigan State University library system I was recently able to find a book titled "Successful Wine Marketing" by Kirby Moulton and James Lapsley. This textbook stood out to me as it intrigues both hospitality business majors and marketing majors. The book was published in 2001 and is intended to give the ins and outs of the wine business while showing people how to be successful within the industry.

Throughout this post keep in mind I am a college student with little to no wine experience, but the subject intrigued me and I was interested to see how it related to marketing. That being said, in the introduction chapter of the book there is a section titled "Consumer Classification" which I found very interesting. Consumer Classification is a very new topic to me. Surprisingly I have not had much experience with classification in my previous classes. In this section Moulton essentially argues that the 55-60% of adults in the US that drink alcohol  can be classified into four subgroups: Connoisseurs, Aspirants, Newcomers, and Simple Drinkers. According to the textbook, these subgroups account for about 5, 45, 35, and 15% of the population respectively. 

I generally agree with the classifications the book gives. Although I do not have enough experience to give regard to the percentages, I like each classification. Connoisseurs are essentially wine snobs who are conscious of quality and stand out to producers. Aspirants are curious and open-minded about wine but are not familiar or experienced at all. Newcomers are generally uninterested and just take advice when given it, and Simple Drinkers just consume wine out of tradition or custom. Thinking about the adults and wine-consumers that I know, generally everyone falls into one of these four categories. 

Another interesting point that the book makes is the outlook of the classification. Moulton argues that even though only 5% of consumers are actually knowledgeable of wine and demand it extensively, this is not necessarily a bad thing. Because of the mass amount of consumers that are interested in or at least like wine, there is an extreme possibility for growth in the wine industry.  One point the book makes is that about 80% of consumers are waiting for a efficient and relevant message which producers should be able to easily capitalize off of. Based off of the earlier classification I do not believe this to be accurate. 

Taking it at face value I disagree that 80% of our earlier classified market would react well to a brand message like that. Connoisseurs and Aspirants would likely respond well, but Newcomers and Simple Drinkers would disregard these messages. Furthermore, I doubt all of the Aspirants would respond like the book states. Even for those that are very interested in wine and are ready to experiment I only believe about half would favor a new promotion or marketing strategy like this. 

Based on my new calculation based on my perception of the consumer market, only about 30-50% of alcohol consumers max factor into the potential of growth that the textbook talks about. After taking the earlier statistic of alcohol consumers in the United States into account this only correlates to about 18-30% of all consumers. Regardless of the fact that this is at least 50% less than the book calculated, there is still a significant growth outlook for the wine industry, I just do not see it growing as rapidly as the book expects or hopes.  


Works Cited

Moulton, Kirby S., and James T. Lapsley. Successful wine marketing. New York: Springer, 2006. Print.

Cover Letters

By: Jake

One of the most important steps to succeeding in the business world is to actually get accepted to a job. This is generally common knowledge. And one of the most important details about the interview process is a formal resume. Everyone who applies to jobs comes in with a resume, or at least a list of their previous experiences. But too often people forget about another aspect of the process: the cover letter. 




Like a resume, a cover letter should be personalized to fit the job you are applying for, and should be sent to the interviewer when applying for the job. Essentially it is a personalized letter describing why your experiences and skills make you a good candidate for the job you are applying for. Unfortunately in today's society not everyone is aware that cover letters are still very relevant and necessary when applying for a job.


In case you are still stumped on how to start or what a cover letter looks like, a generic sample can be found here. 

For some reason there seems to be a stigma connected to cover letters. It may be that people are unclear of why or how to write them, but nowadays it seems like people are creating resumes but not cover letters. In certain college jobs this is acceptable but if someone hopes or expects to gain a well-paying job in business they will need to learn how to write a clear and effective cover letter as well. 



Works Cited

"CareerOneStop." Cover Letters Sample l CareerOneStop. N.p., 10 Nov. 2014. Web. 09 Apr. 2017.

"What Is Your Definition Of "Success"?" Odyssey. N.p., 23 Mar. 2016. Web. 09 Apr. 2017.


Works Referenced

"Stumped on how to write a cover letter that will catch an employer's attention? Get ideas from this sample cover letter." Monster Career Advice. N.p., n.d. Web. 09 Apr. 2017.

Recognizing Truth

- Steve
Prompt #10

In today's world there are many misrepresentations and false information given to the people about various fields. In the business field this is especially true with the media giving false information to the public about business men and women.

One great example of this is the movie "Wolf of Wall Street" released in 2013 by Martin Scorsese based on Jordan Belfort's memoir. The film portrays Jordan Belfort as a very wealthy business man. This image of Jordan Belfort is correct, although it does not stand true for everyone in the business world. Most of the movie shows Jordan Belfort partying on yachts, doing drugs, and ripping off clients. Although this was true about Belfort's life, for the average person watching this movie they got the idea that all people in the business world live their lives like this, which is very much incorrect.

Jordan Belfort is a very rare and odd case of a business man who gets to live his life with no worries and regret free. On the other hand, the normal business man and woman in society have lives that are almost the polar opposite. Those in the business field usually have a jam packed work week and work hard all day, completing various projects and presentations in order to be successful. They do not have the time to do whatever their heart desires and be reckless, they get to work early and leave work late. Also, if businessmen and women want to have fun it is on the weekend when they have their small amount of free time. But many times they have to work on the weekend because of such a large workload. If they do have free time it does not involve partying and doing drugs like Belfort, its going out and playing a round of golf with their buddies or going out for a nice dinner.

Lastly, those in the business world don't make nearly as much money as Jordan Belfort was making, owing gigantic yachts, fancy cars and numerous houses. Although there are many people in the business world that make a very large amount of money and live comfortably, there are also those that make an average amount working in business and struggle to make ends meet.

Overall, the film "Wolf of Wall Street" incorrectly describes the lives of those in the business world with showing the crazy spontaneous life that Jordan Belfort lived. But in reality, this is one large example of a misrepresentation in today's media that portrays a wrong image to the public.

Sources:
"Business Analyst, IT Salary." Business Analyst, IT Salary. N.p., n.d. Web. 04 Apr. 2017.                                                 
Minow, Nell. "The Wolf of Wall Street." Movie Mom. Beliefnet, Inc. And/or Its Licensors, 28 Mar. 2014. Web. 12 Apr. 2017.
Martins Trautmanis (Brother-in-Law, KPS Capital Partners Associate)

How to Beat Retirement

- Steve

In today's society, saving for retirement is very important for your future and there are five very important steps you can take to make sure your retirement is a great one.

Step 1: Max Out Employer Matches

Many employers will offer a 401(k) plan that says the company will match your contribution up to a certain amount. This is essentially free money that the employer will give you so it is crucial to take advantage of it. Who doesn't like free money!

Step 2: Possibly Open Up a Roth Account

With a 401(k) you contribute money into your retirement without being taxed. However, when you decide to take it out later in life you get taxed. A Roth account on the other hand, you get taxed when you make a deposit into your retirement. Roth's are usually most beneficial for those who are just starting their career because they are usually not being taxed at a high rate.

Step 3: Make Some Risky Investments

Great risk usually comes with great reward, but while investing at a young age for your retirement it is wise to choose volatile investments. The reason for this is because even if you have a bad year with your investments, you don't need that money for many years to come. This allows your investment to bounce back. All that matters is how much your investment is worth when it comes time to retire.

Step 4: Have a Plan

Making a plan for your future can include a lot of different things. One example is to figure out how much money you will need to save for your retirement. You can do this by using retirement calculator. Another example of planning is possibly starting to contribute to your child's college fund and how much you need to put away.

Step 5: Having Non-Retirement Savings

Many times in life unexpected events occur and there is nothing we can do about it. Also many times these events are costly so it is important to not have all of your money locked up in assets so that you are prepared for these emergencies that require a good amount of funds.

Overall, planning and saving for retirement can be very stressful and scary but with these five tips retirement can be a breeze. However in my opinion, above all these steps, the most important thing to know is the earlier you start saving the better, allowing the money you saved to compound, essentially giving you free money. In general, all of these tips will allow you to be prepared for the later years in life but most importantly you will be able to enjoy them.


Sources
Connick, Wendy. "5 Things Millennials Need to Know about Retirement." CNNMoney. Cable News Network, 30 Mar. 2017. Web. 02 Apr. 2017.  
"It’s Never Too Early to Begin Planning for Retirement." Quotes Pictures and Images Retirement Category. N.p., n.d. Web. 12 Apr. 2017.