Monday, July 12, 2010

How Consumers' Fancies Can Ruin Markets

The picture is just to catch your attention. :)
But yes, another thing which should catch your attention is the fact that consumers like you and me, who don't particularly have answers to consumer behaviour surveys do actually make or break the market. Lets take simple cases like the car 'Nano' designed, manufactured and marketed by the TATAs.
It was us who created the hype, (OK maybe we were drawn into the hype created by the media and the seller). It was us who went on a spree of advance bookings for the tiny little 1 Lakh car years before the manufacturing operations actually started. It was us who. by word of mouth made our neighbours/ friends/ colleagues believe that it would be the perfect car if we wish to keep the budget low. It was us who were convinced that even as an 'extra' car car in the family for children , wives etc. Nano would be a cute option with low investment. It was us who thought that it would be easy to park a Nano in the midst of cities like Bangalore where your average speed of travel from any point A to any point B at any time of the day, at any location is just about 10 kmph. And yes It was us who made Nano 'the best invention of our times' because it was so consumer friendly.
And then suddenly after the melodramatic manufacturing of the car, we suddenly don't hear ourselves speaking about ' The Nano' anymore!! It doesn't seem to be interesting anymore. We suddenly feel as though buying that car is a negative status symbol! No one is talking about it, no one is planning to buy it either, no one is recommending it to others. Is this hype and disappearance of the same a 'Classic Case of Public Memory Is Short' ??
We sure can go on to analyse the issue, but the fact remains , We as consumers might have caused a Huge Loss to the Company just by waning our interest in an issue we once hyped and which gave incorrect signals to the Company of Public Euphoria!!

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