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Who’s paying for the marketing?

June 21, 2016

 

I want to apologise for being a bit irritated on today’s post but this has something to with an experience that I had yesterday when I was on my way to an appointment and needed an umbrella because of the heavy showers we had yesterday. I was an economic student and marketing was one of the studies of my program. I am fully aware of the importance of marketing in any firm and I know that a successful marketing plan is crucial for increased profits. However, I think that there are some boundaries even in marketing and what I am about to tell you now I don’t think it is correct in any way.

I stopped by 7 eleven for buying an umbrella. I didn’t wanted to pay that much for just an umbrella and thought that 7 eleven would be the best place to stop by for my needs. I was shocked when I saw it since they had only umbrellas with a big logo of 7 eleven on. I don’t like to do marketing for others despite being aware of that this is a strategy that they use in order to get increased publicity.

I don’t want to make this a post about fancy economic concepts but I want to delve into some basis about marketing. Marketing is expensive and businesses use a big amount of their budgets for this activity. I want to give you an example from Norway. If you want to market yourself in a local newspaper you will end up paying around $600 for it. Just think about how much 7 eleven save in cost for increasing publicity by how many people that would see their umbrellas by people carrying it around for them.

After giving up finding an another umbrella I finally accepted the fact that I had to carry with me a huge logo of 7 eleven. Wait for it.. you will soon read the biggest surprise of my visit for buying my umbrella.

I took the umbrella with me and headed towards the line for the cashier and when it was finally my turn I put the umbrella on the cashier. The guy told me the price. The cost of the umbrella was incredibly $11 (NOK 89). I thought to my self seriously.. should I pay you $11 for doing the marketing for you guys! Not am I only marketing for you guys but you also want extra profit for it. The materials for producing the umbrella is not $11. I told him that I would look elsewhere for another umbrella and did not want to cause a scene there.

This made me curious to know how this is practiced in other countries. In Brazil if you are buying something with logos on you pay less for the product. Actually the price of umbrellas with logos on is so small that you almost can consider it for free.

I am curious to know if you agree with me and whether it is like in Brazil where products with logos on are cheap or if it is like the case of Norway where they force you to pay expensive for doing the marketing for them?

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21 Comments

  • Reply Amitav Chowdhury June 21, 2016 at 8:30 pm

    This is a tactic used by brands for free publicity. Branding and advertising through channels, media (digital/print) cost too much, as you have mentioned. But with rising competitions and start-up ventures jostling for space, the big brands are feeling the heat. They do have a lot of capital but still, in business nothing can be taken for granted. The cost of manufacturing is also rising and reducing profit margin is a cause of concern. Now that markets are slowing down dues to people losing jobs and not enough employment across the Globe, purchases come down. But, if you see, when we visit any fast-food joint and ordering a takeaway, we are indirectly doing their advertising as we carry their packaging with the logo on it. Even a soda bottle we carry is indirect advertising. On social media, when we click on advertisements and post our pics, we are indirectly acting as their employees (unpaid) of course. Every click on social media is recorded and the data is sold to companies. So, we are working for free. But given your concern about pricing of the umbrella and the cost, in this case, I found it to be a bit on the higher side, as they are getting enough free publicity and exposure to attract potential buyers. (sorry for the long comment)

    • Reply Roberta Pimentel June 21, 2016 at 8:54 pm

      Very true what just wrote! I know that we are marketing for them when we are carrying bags etc, but i think is too much when we have to pay that much. Thank you for your comment 🙂

      • Reply Amitav Chowdhury June 21, 2016 at 8:56 pm

        Adding to that, they did not have any other brand of umbrellas on display, so, they politely forced you to buy their product. It’s an interesting observation from you, glad, you shared this article and opened it for discussion. 🙂

        • Reply Roberta Pimentel June 21, 2016 at 8:58 pm

          I’m glad that you read it! I think this is important topic 🙂

          • Amitav Chowdhury June 21, 2016 at 9:01 pm

            Of course, after all, we have to pay for the products. It’s good to see how you cover wide range of topics on your blog. Really wonderful work you are doing. 🙂

          • Roberta Pimentel June 21, 2016 at 9:22 pm

            Haha, yeah we do have to pay. Thank you I really appreciate your feedback <3

  • Reply eths June 21, 2016 at 10:20 pm

    Yes, I’m like you. I will have to be really desperate before I buy anything with a company’s logo on it. Drives me crazy!

  • Reply Aki June 21, 2016 at 10:34 pm

    Totally agreed with you!! I feel that if a company spending lots of money for TV commercials, why they just don’t cut the cost and give the product in affordable price!!

  • Reply kbeezyisviral June 21, 2016 at 10:48 pm

    I agree. The branding of items becomes ridiculous. I understand your product must standout and have a name for itself, but paying more for the marketing of a logo isn’t always necessary to increase the companies profit margin. I’m not a coffee drinker, but Starbucks is much more expensive than buying coffee at McDonalds due to branding. And from what I’ve been told–correct me if I’m wrong–that the quality of McDonald’s coffee beans are superior to that at Starbucks. Logo’s are only the skin of the company; not the heart and soul.

  • Reply Niall O'Donnell June 22, 2016 at 12:38 am

    Maybe they set the price at $11 so you’d keep that number in your head, then think more often about 7-11, and therefore do more shopping there!

    • Reply grevisangel73 June 22, 2016 at 1:02 am

      Interesting observation, but they could have also used 7, but 11, sticks in your memory more. I wouldn’t go to s 7/11 to buy something like that, but if you are in the situation Roberta was in, that is what they count on. As far as them gouging on the prices, and promoting their company, it speaks more of their company.
      I think it would depend on what store you went to to get umbrella, if the price would be higher or lower with logo on them.

  • Reply Keith Haney June 22, 2016 at 4:57 am

    Very interesting.

  • Reply leggypeggy June 22, 2016 at 6:11 am

    I don’t like to provide free marketing for companies either. I even carry my own shopping bags so I don’t have to take a store one. Hope you didn’t get too wet.

  • Reply Anon Rand June 22, 2016 at 9:53 am

    I’m not an expert on umbrellas, but when I consider brands, like clothing brands, they are usually more expensive even though they have their logo on there somewhere. This is in America lol. Usually, the knock off brands, like cereal from a store rather than Kellog’s or something, are cheaper. When I compare the nutritional values, they’re not too different. Sometimes the branded stuff is better, sometimes not.

    I think a $11 umbrella that is clearly used for marketing is ridiculous though haha. I prefer not wearing any clearly branded stuff either.

  • Reply Judy June 22, 2016 at 11:23 pm

    Maybe they could have charged 7.00 for the umbrella instead of 11.00….fitting eh?

    • Reply Roberta Pimentel June 22, 2016 at 11:29 pm

      I would say 6.00 was a good price 🙂
      But I get a free umbrella when I was in my meeting so it was a better deal 🙂

  • Reply wbdeejay June 23, 2016 at 6:59 am

    I think paying for branding is something that happens in more affluent countries. The company deems the average person able to pay more, so that is what they charge. Is it the same in Australia.

  • Reply Michèle Wood July 13, 2016 at 11:23 am

    I don’t buy company logos either!

  • Reply autistsix July 31, 2016 at 10:57 am

    If I like my experience in a store I have been known to carry their bag more prominently or even to stuff other shops bags in them. I too feel I should get a discount if the item is being used as an ad for the store. I resent the lack of choice and the ugliness of the branding. My mother talks about market forces stopping things like this, but in a lot of ways big business has us where they want us. If we need something we will buy ugly, expensive, branded products because there is nothing else. I feel both used and impotent.

  • Reply Who’s paying for the marketing? — Robert Pimentel | marketing – engbuseco October 23, 2016 at 11:25 pm

    […] via Who’s paying for the marketing? — […]

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