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Saturday, February 13, 2010
Products and Services for the Permanently Unemployed Consumer - ClubOrlov
Does permanent job loss mean that someone is no longer a consumer? In some cases the answer is yes: (But) some people continue to spend as if they still had a job, and the inevitable result is eventual destitution. Once they run out of unemployment benefits, savings and credit, their purchasing ability decreases to the barest minimum provided by food stamps. I don't mean to sound harsh, but this makes them rather uninteresting from a new product marketing perspective.
Friday, February 12, 2010Also see: Closing The Collapse Gap by Dimitry Orlov (@ Energybulletin.net), a point by point comparison of the collapse of the Russian economy compared to what might happen under similar circumstances in the U.S.
Products and Services for the Permanently Unemployed ConsumerDeveloping and marketing products for a shrinking market poses an interesting set of challenges. Even if a company does an outstanding job and is able to steadily grow its market share, these gains are negated if the market itself continually shrinks by an ever larger amount. For instance, a company might have an outstanding electric vehicle design, but it is destined to fall by the wayside during a time when the number of consumers that qualify for a car loan is trending downward, the used car market is glutted by repossessions, and federal, state and municipal governments are unable to upgrade their car fleets because their budgets are far in the red.
Consumer product development caters to individuals who live in houses or condos, have jobs to which they commute by car, and generate a steady stream of disposable income. This is the group to which the business press often refers collectively as 'the consumer': one often reads that the consumer is retrenching, that the consumer's credit is tapped out, that the consumer's disposable income is shrinking and so on. The consumer is not growing.
What is there left to do except design and manufacture fewer and fewer products?
The answer is as simple as it is surprising...
In Full @ ClubOrlov
In full @ Energybulletin.net
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