The Hills

The Hills is a MTV Reality showed aimed for the entertainment of young adults.  The main goal of a reality show such as The Hills is to create and maintain a successful show to earn ratings and viewers.  The reality show ran from May 2006 to July 2010.  The Hills was a spin-off of the show Laguna Beach.  When Laguna Beach came to an end, MTV wanted to continue to follow one specific character, Lauren Conrad, and The Hills was created.  The Hills popularity increasingly became more popular as "Entertainment Weekly ranted The Hills 82nd on their list of "The 100 Best Shows of the Last 25 Years," state that the series was a "New Classic" (2012).  The Hills became so popular the cast was even on the front of The Rolling Stones Magazine.  The Hills is owned and produced by MTV.  MTV has also started several spin offs from The Hills after its series finale such as Bromance, Audraina and The City.

The main product The Hills provides is entertainment for young adults.  The target age for the reality show is between the ages of 14 and 30.  The aim of reality TV is to make a show that people at the same age, going threw the same problems and situations, can relate to.  The supply and demand of a TV show must never be fulfilled in order to keep the audience wanting more.  It is very important to only have one episode per week so that the audience does not get sick of the show.  If only 12-18 episodes are shown in a season it keeps the audience hooked wanting to see more.  The primary stage of production is to create any stage props and cast the "actors" required for the show.  The secondary stage or production would be the filming and editing of the show.  Lastly, the tertiary stage consists of MTV airing the show on TV. The ratings for the TV show continued to grow threwout the first four and a half seasons, until they tried to replace the main character Lauren Conrad with a former character of Laguna Beach, which caused the ratings to plummit.  The fixed costs for making a show such as The Hills would be the costs of any living space they they must rent/buy in order for the characters to have a place to live.  Some examples of the variable costs would be the wages paid to the actors, camera people, etc.  The show must pay for the use of the equipment needed to film the show and any computers need to edit the show. 

The strongest competitor to a show such as The Hills would be shows such as The Real World, Keeping up with the Kardashians and The City which began at the same time as Season 4 of The Hills.  A competitive advantage that The Hills had over their competitors is that it already had established two of its main characters on Laguna Beach.  As Lauren was a main character on Laguna Beach, and fans seemed to love her, it only made sense to make a spin-off for her.  The Hills has succeeded as it was created and produced by MTV, which is a very popular music channel among teenagers and young adults.  Seeing as MTV had rights to the show, and it was on their channel, they could promote the show as much as they wanted to try attract fans.  A weakness of this product is that some people felt as though the show was scripted.  Once the show had its finale, a few of the actors admitted that some parts had to be re-inacted as the cameras were only shooting three days a week. Several viewers seen it as a fake show, especially when MTV replaced the main character.  The product "The Hills" was a successful product for five years.  It provided entertainment for millions of viewers per season, and created successful careers for the main characters as they have all branched off into new ventures in their career.

References:

The Hills.  2012.  http://en.wikipedia.org/

The Hills.  2012.  http://www.ew.com/

Barbie is a doll intended for the use of children's play, manufactured by Mattel Inc.  Barbie was created in 1959 by Ruth Handler who named the doll after her daughter Barbara.  Ken was later introduced in 1961, also named after one of Ruth's children (2012).  Ruth's idea to invent a adult-like doll for children to play with was created after watching her daughter play with paperdolls, giving them adult-like rolls.  Ruth went to Mattel Inc. with her idea and on March 9, 1959 Barbie was introduced to the world at the American Toy Fair in New York City (2012).  Barbie has grown tremendously over the years with thousand of different barbie's available to the public.  Mattel Inc. has been the manufacturer since the day it was created, and has continued to produce the Barbie dolls to date.

Barbie's popularity has expanded into movies, books, games, etc.  The Barbie logo is put on several children's products such as back packs, lunch boxes, bedding, etc.  While there are thousands of adults who collect the dolls, the target audience is definitely children.  The supply and demand varies for each individual Barbie.  For example a Barbie such as Doctor barbie may have millions of barbies available to the public.  Meanwhile, the tatoo barbie or the millenium barbie had a limit on how many were produced, making them more expensive to purchase.  The demand for these products increases depending on the time of the year.  At seasons such as Christmas time, the demand increases as millions of little girls have Barbies on their wish list.  The primary stage of production would be producing the materials needed to create the dolls.  "A modern Barbie doll has a body made from ABS plastic, while the head is made from soft PVC" (2012).  The secondary stage is the production of these Barbie dolls by Mattel Inc.  The final stage of production, the tertiary stage, occurs when the Barbies are distributed to stores which sell their product to the customers.  When the first Barbie was sold it cost only $3.  Now Barbies can Range anywhere from $12 to $200, sometimes spending thousands of dollars if the barbie is from an older or limited collection.  The fixed costs for the production would be the cost of the factory and utilities.  The variable costs include the employee wages, fabrics and packaging supplies, to name a few.  As sales increase, the variable prices for Mattel will also increase.  "Mattel's Boys and Girls brand, which contains its Barbie and Hot Wheels lines, reached $1.36 billion in fourth-quarter gross sales, a 7% increase from a year ago" (2007).

The strongest competitor Barbie has met is the Bratz dolls produced by MGA Entertainment.  "In 2004, sales figures showed that Bratz dolls were outselling Barbie dolls in the United Kingdom" (2012).  Another strong competitor that has arose is the Moxie Girls also by MGA Entertainment.  The competitive advantage Barbie has over these companies is that they were the first adult-like doll to enter the market.  Mantel offers such a wide range of dolls, and various outfits, making them easily interchangeable.  Barbies have continued to succeed because they try to appeal to all types of individuals by creating several different types of barbies.  They have Hispanic and African American barbies, among other nationalities. They listen to the complaints by the consumers and try to accomodate thier needs.  There is even a wheelchair barbie to appeal to the disabled.  The main weakness for Barbie is the controversy it receives about the figure of the doll.  Some consumers believe that the unrealistic figure ot the barbie doll leads girls to diseases such an anorexia and bullemia. Over the past 53 years Barbie has expanded into a worldwide known brand appearing in movies and TV shows such as Toy Story and the Simpsons.  The popularity has increased over the past 50 years and will continue to do so as children are now playing with their parents dolls.


References:

Powered by Barbie and Hot Wheels, Mattel Profit Soars.  2007.  http://www.forbes.com/

Barbie.  2012.  http://en.wikipedia.org/

The History of Barbie Dolls.  2012.  http://investors.about.com/

Netflix

Netflix provides entertainment to millions of people threwout the United States, Canada, Latin Amerca, the Caribbean, United Kingdom and Ireland.  "Netflix was founded in 1997 in Scotts Valley, California by Marc Randolph and Reed Hastings, who previously worked at Pure Software.  Hastings was inspired to start the company after being charged late fees for returning a rented copy of Apollo 13 after the due date" (2012).  Netflix charges a base rate of $7.99 to watch  the thousands of Movies and TV series probivided.  "The company has built its reputation on the business model of flat-fee unlimited rentals without due dates, late fees, shipping or handling fees, or per title rental fees" (2012).  The following link from the New York Times illustrates how the revenue for Netflix has increased from 2004-2010 into a billion dollar company: http://www.outsidethebeltway.com/chart-of-the-day-netflix-v-blockbuster-edition/

As of this current date, Netflix provides only the service of the unlimited movie and tv series rentals for a base monthly cost.  While Netflix can be used by any individual of any age, the main target audience is to adults between the ages of eighteen and forty.  Netflix is internet operated, therefore to use this service customers must have internet.  Customers may run internet threw their wii or playstation to watch movies threw their TV or simply watch movies on their computer.  The demand for this product is growing rapily as seen in the above link.  As demand increases, the increasing number of consumers will increase the profit dramatically.The supply of this service is increasing as Netflix is making deals with production companies to make their movies available on their webiste for subscribers to watch.  The primary stage for such a service is when the movie or tv show is physically being recorded.  The second stage involves the movie being put onto a DVD to sell to the public.  In the tertiary stage Netflix receives the right to display the movie on their website for customers to view.  In 2011, "the Los Gatos, Calif-based DVD and digitcal video-rental service said it wearned $60 million, or $1.11 a share, compared with a profit of $32 million, or 59 cents a share, in the same quarter a year ago.  Revenue rose 46% to $719 million" (2012). 

The strongest competitor Netflix must compete against would be Pay-Per View channels, as DVD rental stores are slowly becoming obsolete.  Theatres may also be a competitor as some individuals want to see a movie as soon as it comes out.  The competitive advantage Netflix has is definitely its low price and unlimited rentals.  It is convenient to be able to watch thousands of movies from your home without having to run out to a rental store to pick one up, and then have to take it back on a certain date.  The fact that Netflix is only $7.99 a month is why it has become so popular.  If a customer watches four movies a month on Pay-Per View it would cost approximately $32.  It costs approximately the same price to rent one movie at a rental store, as compared to a months worth of unlimited movie on Netflix.  A possible weakness of the company is that they are limited to only the movies of certain production companies of which they have made a business deal with.  The profit of Netflix continues to grow as they expand the business offering more movies. 




References: 

Chart of the Day:  Netflix v. Blockbuster Edition.  2003-2012.  http://www.outsidethebeltway.com/

Netlix.  2012, February 13.  http://en.wikipedia.org/

Netlix Profits Climb 88% as Subscribers Soar.  2012.  http://www.marketwatch.com/

McDonald's

McDonald's is a fast food restaraunt distributing burgers, fries, chicken, breakfast, salads, wraps, etc. to billions of people across the world.  While there are thousand of competing restaraunts available to the public, McDonald's goal is to serve people as quickly as possible.  The restaraunt originally started in 1940 as a barbeque restaraunt.  In 1948, it changed its policy, and the McDonald's fast food chain was founded (2012).  McDonald's has grown over the years, making changes that are appealing to new and old customers.  Some of these changes included introducing the kids happy meal in 1979 and introducing indoor seating in 1962.  Roy Kroc joined the McDonald's team in 1955.  Since then the late Roy Kroc purchased the chain and turned the company into a woldwide franchise (2012).

McDonald's aims their advertisements to parents and children.  The McDonald's commercials try to influence parents to take their children to their restaraunt.  The commercials imply that the restaraunt is a family friendly place that will make kids happy.  It appeals to children with the commercials featuring the Playplace designed for children.  In the past McDonald's strongly advertised Ronald McDonald and his friends including Grimace, the Hamburglar and Mayor McCheese to name a few.  The demand for fast-food restaraunts such as McDonald's has increased since the typical household now possesses two parents in the workforce, as opposed to one.  With the increase in technology, people's lives are becoming more hectic making a restaraunt such as McDonald's very convenient and an easy choice.  The supply for McDonald's is increasing as demand increases.  McDonald's employees 17,500 British and Irish farmers, which meet the needs required by the demand (2008, Jan 4).  The primary stage of production would be the raising of the farm animals for meat.  The secondary stage of production would include the creation of the patties, chicken burgers, chicken nuggets, etc. in order to sell them to the company.  The tertiary stage includes the selling of these products to the consumers.  The prices of McDonald's products are amont the cheapest in the fast food industry.  Their goal is to provide "good food at affordable prices" according to chief executive Steven Easterbrook.  The fixed costs for McDonald's would be the cost of the building, the cost of creating the kids playplace, and the utilities required for operation.  The variable costs include the cost of the product required to make the meal such as buns, pickles, cheese, meat, etc., the cleaning supplies required for the upkeep and the wages for the employees.  "McDonald's revenue grew 27% over 3 years ending in 2007 to 22.8 billion, and 9 percent growth in operating income to 3.9 billion" (2012, January 27).  In September 2011, the gross profit margin was 44.8%, making a very large profit for a billion dollar company. 

McDonald's strongest competitiors include fast-food restaraunts such as Dairy Queen, A & W, Burger King, Wendy's etc.  The competitive advantage McDonald's has over their competitiors is the speed of customers receiving their order, the price of their product and the appeal to children threw kids meals and the play place.  Implementing these three advantages has made the franchise a very successful, very popular company.  A disadvantage McDonald's struggles with is PETA publicly petitioning against how the animals providing meat are treated (2012, January 27).  This will be a constant stuggle for the company as animal rights activists will never support animals being killed for meat.  McDonald's has became a very successful fast-food restaraunt largely due to exceptional advertising appealing to families across the world. 



References:

McDonalds:  Getting to know us.  2010-2012.  http://www.aboutmcdonalds.com/

Riley, Jonathan.  2008, January 4.    http://www.fwi.co/

McDonald's.  2012 Jan 27.  http://en.wikipedia.org/

McDonalds Corp (NYSE:MCD).  2007.  http://finapps.forbes.com/

Best Buy

Best Buy is a very popular electronic company sells products such as cellphones, computers, Ipods, etc. worldwide.  Best Buy aims to provide their customers with the best service possible by providing 24 hour customer support.  As stated on Best Buy's official website "Best Buy offers consumers a unique shopping experience with the latest technology and entertainment products, at the right price, with a no-pressure (non-commissioned) sales environment" (2012).  "The first Best Buy Canada Stores were opened in the fall of 2002, with eight locates in the Greater Toronto area.  The name "Best Buy" was created in 1981 when the store named Sound of Music held a "Tornado Sale" (with the sale promoted as a "Best Buy") and it became an annual event (Best Buy, 2012).  Mike Pratt is the current President of Best Buy Canada.  He started as a sales associate at Future Shop in 1990 after graduation from the University of Western Ontario in his hometown of London, Ontario (Tay, 2011).  Best Buy's main products are electronics and the main service they provide is helping customer's with all their electronic related questions.  Their target audience would be individuals between the ages of 14 and 40, as this is the most popular age span for cell phones, lap tops, ipods, etc.  Supply and demand for electronics changes rapidly for each product that is produced.  Everyone always wants the newest and most popular version of technology.  Therefore when a product is first introduced to the market, demand is very large and the supply is never met.  For example, when the Iphone 4 came out, stores sold out rapidly even though they are very expensive as consumers want and feel as if they need the most current version.

The first stage of production is the primary stage.  The primary stage for electronics would be the production of plastic and metal which will be used in the secondary stage to produce the electronic gadgets.  The tertiary stage, which is the third and final stage, is when Best Buy sells the products to their customers.  Best Buy  generates over $3 billion per year in revenues (Best Buy, 2012).  The gross profit margin for the last quarter of 2011 was 26.6% , creating a very large profit (2007).  "At the end of fiscall 2011, we [Best Buy] employed approximately 180,000 full-time, part-time and seasonal employees" (2012).  Best Buy provides very reasonable prices for their products as a large number of thier customers are in highschool and university.  The fixed costs for Best Buy would include the cost of the store and utilities expenses.  Best Buy would have numerous variable costs including the wage for employees, advertising expenses and general maintenance.

Best Buy has several major competitors including Circuit City, Radio shack, Walmart, and any other place selling electronics (2012).  The competitive advantage that Circuit City and Radio Shack may have is that they do not offer as wide of a range as Best Buy.  Offering less variety makes it more easy for staff to know everything there is to know about the products.  The advantage stores such as Walmart and Target may have is that they sell a very wide variety of products.  Individuals with kids or simply busy schedules may decide to go to one of these stores in order to save time.  Best Buy has become a very successful company over the years.  A large part of this success is due to their educated staff and the newly created "geek squad."  Technology has numerous problems that can take place, making it very difficult for users to diagnose the problem.  The fact that a technology store has educated staff that can help the consumers is a crucial aspect to their success.  A possible weakness is that consumers may have to wait a great length of time for a representative assistance.  With the large success of the company, individuals may become irritated having to wait for support.  Another issue with having such a large electronics store is that theft may be an issue, as there are numerous unsupervised customers browing.  Best Buy has became an extremely successful store, and will continue to grow in the upcoming years.

Citations:

Best Buy.  7 February 2012  http://en.wikipedia.org/

Who are the Major Competitors for Best Buy?  2002.  http://wiki.answers.com/

Best Buy Co Inc. (NYSE:BBY).  2007.  http://finapps.forbes.com/

Best Buy.  2009-2015.  http://phx.corporate-ir.net/phoenix

Mike Pratt, President and COO, Best Buy Canada.  2011.  http://www.bcbusinessonline.ca/

Best Buy.  2012.  http://www.bcbusinessonline.ca/

Best Buy.  2012.  http://www.bestbuy.ca/