Final WP#3 with revison suggestions

Here are the revisions I would make to my WP#3:

When presenting other sides of the argument, I would probably take more time to evaluate the sources I used. I didn’t talk about what their motives are or their reputations. Doing that could have helped my position or shown them to be a non-credible source.
I also didn’t talk about the values that are present in this paper. If this kind of fanaticism over technology gadgets is a good thing or not. I would add that perspective to make the paper as a whole more complete.

Here is my WP#3 that was turned in as the final;


Jason Bloom
July 28, 2007
ENG 102 Summer Session 2
Professor Shelley Rodrigo
WP#3



What Creates the Demand for Consumer Products and How Manufacturers Can Use it the Their Advantage


Although consumers have been buying new, high tech gadgets and toys for years, there has not always been the frenzy that has been created by these products launches. This consumer madness is a relatively new phenomenon. Because this strange rise has come about only recently, one wonders, what is the cause behind it? Is it the media? Is it the marketing that the companies do? Or, could it be the result of a psychological or other need to consume? And if we can pinpoint what causes this high demand for technology and gadgets, then can manufacturers manipulate consumers to ensure that their newest products will be a hit? Because this strange rise has come about only recently, I believe that the need to buy expensive, high-tech, or high-demand products is created by marketing and media.
The frenzy around the launch of new products and toys is relatively new, developing with the spread/rising influence of media. In fact, the first example of a toy or product creating a buzz was the introduction of the Cabbage Patch Kids in the 1980s (McKeand, 2002). It is widely regarded as the first consumer product of any kind that people stood in line for and resold for profit. The Cabbage Patch Kids became so popular because the media made a story of the fact that “no two are alike. You don’t merely purchase them, you adopt them” (McKeand, 2002).
Thomas L. Harris, in his book, “Value-Added Public Relations: The Secret Weapon of Integrated Marketing”, states, “The Cabbage Patch craze was fueled entirely by public relations” (Harris, 1999). He goes on to also cite the release of Nintendo 64, “which became the fastest selling video-game system in history”, largely due to the fact that Time magazine named it “machine of the year”. A lesson learned, Harris adds, is that to create consumer interest, one should “fan the frenzy with reports of consumer demand” (Harris, 1999).
Other examples of hit products include Beanie Babies, Furby toys, Sony PlayStation 3 (PS3), and Apple’s iPhone. Tickle Me Elmo, another hit toy from several years ago, was another product that fans stood in line hours to buy. In an interview with PBS, Gary Cross, Penn State University history professor and noted author of "Kids Stuff, Toys and the Changing World of American Childhood," was asked why he thinks interactive toys are so popular. His response was, “Well, I think they're popular in part because they - they're hyped, in part. One of the real attractions of Tickle Me Elmo a few years ago or some of the other interactive toys like the Virtual Pets of last year was that they were part of a fad, and one of the real attractions is simply to be a part of that fad, to be the only kid on the block who has one, or for the - to be the parent who's able to get one” (Toy Story 1998). The hype, not the product, creates the demand for the product. So people are buying it because only some people can get their hands on it, and not because it’s the greatest toy ever.
More proof that marketing and media drives demand for certain products are the idea that consumers tend to buy things they want, not that they necessarily need. This statement is backed up by the fact that many new gadgets are not only prohibitively expensive, but they actually complicate our lives. “The ability to take a product out of the box and just have it work, without the need to read a manual for hours, is now on most consumers’ priority lists” states Paul Zeven, of technology expert internet site CNET, in his commentary titled “Do people need the gizmos we’re selling?” (Zeven 2006). It becomes clear that the demand for products is artificially created and inherent in our lives. In fact, “two out of three Americans have lost interest in a technology product because it seemed too complex or difficult to operate” (Zeven, 2006). This article, ironically from an internet site that is an industry leader, supporter and expert in all matters technological, clearly states that most of us don’t need the gadgets we’re buying.
A recent article in the Christian Science Monitor states that the frenzy around the Furby toy is driven by the media. The article reports that toy manufacturers can create demand for their product by appearing on certain television shows and creating hype for their product (Scherer 1998). This buzz creates high demand for a product, even before the “hot” toy is on the market. Around the holiday time, articles in the paper and reports on the news often report on “this year’s hot gifts”, adding more fuel to the fire. Furthermore, when the media reports on those long lines and fights over a product, it creates even more demand, because the casual consumer thinks “everyone else has one, so I need one too” (Scherer 1998).
The influence of marketing and media has become a growing concern in some circles. Website globalconcerns.org talks about this problem in an area dedicated to human rights. Their position is that people are almost powerless to resist the messages they see and hear: “…as the years have progressed, the sophistication of advertising methods and techniques has advanced, enticing and shaping and even creating consumerism and needs where there has been none before, or turning luxuries into necessities” (Shah, 2005). Consumers are simply convinced that their wants are actually needs.
The article also faults the media, saying that companies have too much power in their influence over what kinds of stories are written. “A study in 1990 discovered that almost 40 percent of the news content of a typical U.S. newspaper originates as public relations press releases, story memos, and suggestions” (Shah, 2005), adds the author. He makes it clear that a company can become a story far too easily, simply by recommending that their “news” be covered.
Some people would argue that our economic system of capitalism creates the demand for product. Because we are a “free market”, that means that people can sit in line and be among the first to purchase a product and then resell the product for a profit. One example is the PS3 which, at launch, retailed for $599 but sold on eBay for an average of $1,959.73 (GamePro Staff, 2006), nearly four times it’s price.
This is a good point—capitalism does make the purchase and reselling for a profit possible. Still, it’s the marketing that creates the demand in the first place. It is the news reports of fights in lines outside of Best Buy, of mothers pulling each other’s hair over a doll, that make people think they have to have a new product, and that they should have it at any cost.
Others may argue that there could be an underlying psychological need to buy. This psychological need is called “compulsive shopping”. A compulsive shopper is one who goes on shopping binges and tends to “shop till they drop and run their credit cards up” (Engs). However, compulsive shoppers typically shop often and buy a lot of things.
In addition to the fact that the behavior we have discussed does not fit the profile of a compulsive shopper, most of the “on the street” interviews did not capture that inherent need to buy. As in the case of David Clayman, who was on vacation from Chicago, “happened to be walking by and decided to change his travel plans on the spot” (Jesdanun, 2007). While the addiction does exist, it does not normally manifest itself in people waiting in lines for two days. “For Jessica Rodriguez, waiting four days for an iPhone is nothing when the prize is ‘the next big thing’” (Jesdanun, 2007). Rather, compulsive shoppers tend to buy out of compulsion, without thinking, sometimes even “blacking out” during the buying process.
Another reason people might feel compelled to buy something new is to feel better about themselves. An article on GROKDOTCOM, a website run by New York Times, Business Week and Wall Street Journal best selling authors Bryan and Jeffrey Eisenberg, recognized “The 5 Whys of Consumer Purchase Behavior” (Eisenberg 2007). In their article they list “who we are” and “why we buy” as top drivers of consumer purchase behavior. A closer look at “who we are” says that people buy things because of who they think they are or, more importantly, who they want to be. With the use of celebrities hocking products, or “cool” companies introducing new gadgets, they have clear influence on the “who” people want to be. True, people buy things to feel better about themselves. But this is again another clear influence of advertisers telling people what “cool” is, and that if they buy a certain product, they, too, will become “cool”.
A second “why” in this article cites Maslow’s Hierarchy of Needs. At the bottom of this pyramid are the necessities in life—food and shelter. The next level cites “lifestyle item”, such as “food, clothing and beer” (Eisenberg 2007). The third level includes luxury items. This is where $600 game system would normally fall. However, media and advertising have positioned these products as “must haves”—you can’t live without them, you’re not important without them—so these expensive gadgets and toys move closer to “needs” and further away from wants. In fact, rarely can people distinguish between their needs and wants anymore, as the ads and news reports they see make it clear these toys and electronics are “must have items”. Simply by labeling them “must haves”, the media has made them an imperative purchase.
It’s clear that manufacturers can control the demand for their products and that they can influence marketing and media to help their own product sales. So what steps can manufacturers take to ensure their next product will be a hit? Of course it helps to have an innovative product. But the manufacturer’s main task is to create the hype or buzz around the launch, to make it seem like the average consumer can’t live with out it. This buzz can be created by simply planting the idea with media, who will report on this amazing new product ad nauseam.
Magazine and talk show placements are another way to get people talking about your product. Giving them away free to celebrities, or paying celebrities to endorse or use the product will also make people think they need to have the product to complete the lifestyle they admire in the rich and famous.
For new technology gadget launches, it is useful to spill carefully crafted “secrets” on popular tech-talk websites and blogs. Everyone will wonder what technologies and capabilities the new product will have, and word will spread quickly that it will be the “coolest thing ever”. Toys, too, can become “must haves” simply by implying that very thing in advertising. Parents will want to either provide the must-have for their children, or won’t want their children to feel left out.
Another way to create a hit is to get on top lists, such as lists of the best new toys for the holidays, neatest innovations (think about iPhone’s button-less navigation), or “best anything of the year” lists. Or, a manufacturer can manipulate the demand simply by producing less. Slower production actually increases demand (and pricing) for products. No one wants to be caught without one, so lines will form. The media will report on the lines. And then more people will want the product.
Some people will argue that these products are useless, that their production doesn’t help people or society. But I would argue, and I think you would agree, that where would man be without advancements such as fire, the wheel, the telephone, and the computer? And how far can we go with the technology of the next great game system, toy, or phone?