Week 8 – Global Business

Does the Internet democratize the consumer? Is privacy a concern?

Quick hit summaries:

Turow’s article on Audience Construction and Culture production

• Sets up dilemma between producers exploiting technology to survey interests of consumers to improve their products and brings to light issue that they maybe intruding in consumers’ privacy by surveillance of ways consumers use the internet
• On the other hand, this other mode called customer relationship management becomes a kind of loophole/creates a different avenue for producers to not come across as sketchy stalkers—using CRM means that instead businesses tap into the consumer’s interests by letting consumers express their interests likely without knowing that they are doing so. For example CNN.com asks users to personalize their page to get breaking news in their e-mails. This allows CNN & its advertisers find out what their interests are without actually having to follow the consumer’s web exploits.
• Turow also brings up the “walled garden” where consumers can go for info on communications and commerce services—this is a good place for advertisers to find out more about the consumers’ interests

Sharma and Sheth’s article on the revolution in marketing thought and strategy

• S&S look at the dynamics of marketing practice and thought as consequences of web-based marketing. These characteristics include: Start manufacturing only when customer orders; Make stuff based on preference of consumer i.e. Dell’s personalization strategy; Effectiveness continues to become a way to enhance customer loyalty; Strategy tends to be to change customer expectations instead of affecting customer satisfaction; Marketing integration becomes important because of synergy in integrating different functions of new organizations
• Also considers change in consumer behaviours including: Consumers become cocreators; Reducing locational dependence in having faster access to direct info; Access pricing faster;
• Constraining factors include continued cost and tax advantages, concern over privacy/trust/security

Tian, Yin and Taylor’s article on internet-based manufacturing

• They go through in great detail the model of internet-based manufacturing wherein multi-agent model is important in flow of information and task allocation within the network companies
• The main goal for distributed information system for networked manufacturing is not just inter-operability for individual enterprises but also collaboration at semantic level
• Authors propose new infrastructure for distributed info management systems, which includes several agents to cooperate with each other i.e. user-friendly interface, cooperative to find partners, application information, retrieval, security and network communication agents

Ok… so given this “data” from the three articles I think the internet somewhat limits but mostly proliferates the democratization of the consumer. The first way it democratizes the consumer is by ideology. Democracy is tied to the cosmopolitan theory. The cosmopolitan theory stands for all the ever-pervasive universalistic values of the west—the centrepiece system of the democratic society is capitalism. Web-based marketing exists in the realm of capitalism. It also democratizes the consumer because what for-profits promote in their marketing are still based on the consumer’s interests, in a sense the consumers are free to dictate to the producers what they want produced. Isn’t the whole reason why businesses want to stalk consumers is so that they can find out what consumers want in order to be able to provide it to them? Also, as Sharma and Sheth’s article emphasizes: contemporary manufacturing is based on personalization. As they say, the “strategy tends to be to change customer expectations instead of affecting customer satisfaction.”

At the same time, models like the customer relationship management, while it isn’t a flat out 1984-esque privacy invasion, become a loophole to somewhat dictate what consumers should be buying. Like Turow mentions, some businesses reinforce a sense of loyalty from customers by offering discounts and other benefits. The perks a consumer gets from buying from a specific company more or less influence consumers to keep buying what that business produces. In a sense this enticement prevents them from feeling totally free to explore what other companies have to offer because they’ve gotten used to the comfort of trusting that one brand.

The fun theory website I think is a creative and clever way that Volkswagen demonstrates the customer-relationship-management model. While it doesn’t offer consumers blatantly tangible benefits/deals, it offers interesting ideas people can relate to and connect with (i.e. piano stairs up the subway, putting magnets on shirts to make folding clothes fun etc.)—this gives the company the advantage of memory.

Moving on to the iPhone apps… while these apps look extremely helpful and fun, I think they may also become extremely useful in generating a generation incapable of living outside gadgets and relying on the human brain to perform day to day functions. What’s awesome: lets you take panoramic photos, access to news, weather, maps, recipes, What’s not so cool: music features (i.e. the one that “teaches” you how to play the guitar, it’s not nearly as close to the real thing), other functions including news, office tools, charts, emails—these could cause someone to suffer similar dysfunctions brought about by the “crackberry.”

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