How well does our system work? You can use the numerical index to check our blogs from the last big recession.
Much of the world suffered a severe recession from 2008 to 2011. During that time, we wrote more than 250 blogs using publicly available information and our Strategystreet system to project what would happen in various companies and industries who were living in those hostile environments. In 2022, we began to update each of these blogs to see what later took place and to check the quality of our conclusions. To date, we have completed the first 175 of our original blogs. You can use these updated blogs to see how well the Strategystreet system works.
There has been much press over the last few weeks about the problems in the Euro Zone. Most particularly, we have learned more than we may want to know about the problems of deficit spending in Greece, Spain, Ireland and Portugal. Just recently, though, we may have learned that the problem is not the deficit spending in those recessionary countries. No, the problem seems to be the Germans. Over the last ten years those nasty Germans have kept the lid on labor cost growth and have jacked up their rates of productivity. (See the Symptom…
Read MoreRecently, Wal-Mart found that it was losing some customers to competitors. After examining the reasons why, the company discovered that some of its customers were leaving because Wal-Mart had eliminated some of the products the customers were used to buying at Wal-Mart. This situation gives us the opportunity to look at the Customer Buying Hierarchy in a retail business. We use the Customer Buying Hierarchy to analyze a company’s competitive situation and to evaluate its product and service innovation program. Through thousands of customer interviews, we have seen that customers buy in a four part…
Read MoreSeveral months ago, we wrote a blog (See Blog Here) that noted the capacity reductions in the airline industry. In particular, the large legacy airlines were reducing their capacity in order to raise industry pricing. At the time, this effort was showing relatively little help with industry pricing. As part of this original blog, we noted that there was a problem with the withdrawal of capacity in order to force prices up. The problem is expansion of capacity by low cost competitors. We explained that we had seen many cases in other industries where industry…
Read MoreWe use the Customer Buying Hierarchy to evaluate many developments in a market. This Customer Buying Hierarchy argues that customers buy Function, Reliability, Convenience and Price, in that order, when making a purchase. The customer does not buy until he finds one company who can offer him a benefit in a category of interest to him that no other competitor can offer. In many markets, leadership in Reliability is the hallmark of the best competitors in the industry. That has been true until lately with Toyota in the automobile industry. Their once vaunted reputation for…
Read MoreAbout a year ago, we wrote a blog about the leading ski resort in Northern California, Squaw Valley, emerging from a Leader’s Trap (see Blog here). We predicted at the time that Squaw Valley would gain market share quickly as a result of its change in pricing strategy. The preliminary results from this change in strategy are in. They are impressive. First, some background. For several years, a large well-run ski resort, Northstar, offered very attractively priced season passes. The other ski resorts largely ignored Northstar’s pricng, so that ski resort gained market share with…
Read MoreIt seems that retailers are often on the leading edge when it comes to innovation and creativity in their crafting of their offerings. They have an excellent sense of how their customers think. For example, a couple of years ago, McDonald’s instituted a product offering around the change that a customer was about to receive for his order. Software the company had purchased created a discount offering that allowed the customer to take another item for the change, or slightly less than the change, he was about to receive from his original order. A high…
Read MoreThe small consumer battery business is in the midst of a price war. The short-term losers in this war will be the industry leaders. But the longer term losers would be the low-end Price Leader competitors in the market. Energizer Holdings is the industry leader’s market share, with a 39% share. Procter and Gamble follows closely with its 36% share of the market with its Duracell line. Low-end private label suppliers make up most of the remaining market. (See the Symptom and Implication, “Most competitors are offering low prices after a period where leaders held…
Read MoreAfter months of back and forth, Kraft Foods has now reached a firm agreement to buy Cadbury. This may be a good thing for Kraft. Warren Buffett demurs due to the price. The jury is out. However, this merger may not be good for some of the other competitors in the industry. (See the Symptom & Implication, “The industry is consolidating through mergers and acquisitions” on StrategyStreet.com.) In particular, some industry observers are pointing to the precarious position of Hershey. They note that Hershey will be a very small competitor in the global confectionary business.…
Read MoreOne of our local newspapers is running a series on the problems of public transportation in the San Francisco Bay Area. The problem seems to be that ridership is well off of plan. The economy, and its attendant reduction in jobs and squeeze on commuter pocketbooks, has reduced demand. Virtually all of the authorities in charge of the various modes of public transportation have found the same magic elixir for this sickness. They plan to reduce services and raise prices at the same time. Let’s see now. We find that demand is off and our…
Read MoreIn 1960, the city of Chicago built McCormick Place. This facility was the first convention building built specifically to hold very large national conventions. McCormick Place put Chicago, as a convention center, on the map, where it stayed as one of the top convention destinations for the last fifty years. Now clouds gather on the horizon. Several large conventions have cancelled their Chicago venue and switched to other cities, like Las Vegas or Orlando. They site Chicago’s high cost and complex labor work rules (see “Video #9: Overcapacity and How it Develops”). The economy has…
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