The Good, the Bad and the Ugly

One of my favorite things to do is just sit around and listen to the news of the week, whether it’s business, sports, politics, or whatever else. My drive to school (although it is short) usually involves talk radio arguing pro or anti Obama or financial planning. While sitting at home in my favorite chair, I just cannot beat a new episode of SportsCenter or a number of business news shows that are actually worth watching. This post will discuss three of the biggest stories that have stood out to me in the last month (all of which deal with business – one sports… my two favorite things).

The Good

Does Apple do anything wrong? Ever? Not in my mind. I know there are some of you out there who may be getting sick of hearing us talk about Apple, but with a business model as good as theirs, why would we stop talking about them? Anyways, last week, the 10 billionth song (10,000,000,000- yes 9 zeros after the 10) was sold on iTunes! Wow! What an accomplishment. The company who revolutionized the way we listen to music now has successfully changed how we purchase our music. And that’s not the best part. When the purchaser of the song (which happened to be by the late and great Johnny Cash) dowloaded his song, he won a prize. Not just any prize… A $10,000 gift card. That’s a lot of music. When asked what he would do with the gift card, the 71 year old man simply said, “Never have to buy another present again.” And when he won, guess who made the call to inform him of the prize? Yep- Steve Jobs himself. WOW! (Read the story here).

There are a few things that stick out to me of why I love this story so much. First of all the fact that the CEO of one of the greatest companies in the world personally called one of his customers is simply amazing in my mind. He took the time out of his day to acknowledge this monumental event is what makes Apple superior than all the others. The second thing that I love is that they just gave away $10,000 of free music. Or basically spent $10,000 on a new marketing plan. Anyone who has ever taken an economics class knows that the best way to get a repeat customer is to give something addicting away at a very cheap, or free, price. I’m not advocating the use of it, however I’m sure cocaine dealers do this exact thing. If they can get a user addicted, they can get them to come back. Genius. So when Grandpa gives iTunes credit to his grand kids, and their friends see their cool new songs, who do you think that friend goes to begging for that new song? Their parents who actually have money to spend. Like I said before… Genius!

The Bad (made better)

Toyota has recently had some rough times as a company. A large number of their vehicles haven been recalled due to either faulty gas pedals or floor mats catching the gas pedal, causing the car to accelerate and continue moving at a constant, high speed. This creates an obvious problem. So what did Toyota do? They admitted their problem- which is the smartest thing I believe they could have done. They did not try to plan it on one person or branch of the company, they just “manned up” so to speak and accepted the fact that they let their customers down. One way they informed the public of their mistake is through the commercial below.

They know that they need to restore customer confidence, otherwise the other foreign automakers who have a presence in America (or domestic ones) will pick up their sales. So hats off to Toyota.

The Ugly

Now for my favorite section of the day… The Ugly. Tiger Woods was recently dropped by one of his biggest sponsors, Gatorade. WHY!!! I can understand and agree that what he did was wrong. I don’t agree with his actions, nor do I condone them. But what is Gatorade thinking?? And if they HAVE to drop him, why now? Why not when all the information first came out? Tiger was recently voted the Athlete of the Decade. That means of all the sports and all the athletes in the last 10 years to play a sport, they picked a golfer to be the best. And because of an “addiction” in his personal life, he’s gone. A fellow MBA student put it this way, “Gatorade is basically telling America and the world that it’s not okay to make mistakes.” And I have to say I agree with him. Looking back to my timing question earlier, why now? Tiger is about to reenter the sport and hopefully play at the Masters. Soon enough he will be the world’s greatest golfer and everyone will forget (hopefully) this whole situation.

So what should happen? Easy. Powerade should pick up Tiger. They have always been inferior to Gatorade in every area (in my mind) including brand recognition, marketing, and frankly even taste. So why would they not capitalize on this opportunity to finally be better than them? You may think this is just copycatting, but it would more than likely still work. Why? Ok so say a father and a son are on their way to somewhere-anywhere. They stop by the local gas station for a quick drink and the boy wants a sweet treat. What does he choose? Gatorade because of the name? No. He chooses the Powerade because it has his favorite athlete on it. And dad doesn’t care because his son is happy. Game, set, match (I know that’s tennis lingo, but hey).